Wright v. Bank of New York
2012 Ohio 2289
Ohio Ct. App.2012Background
- Wrights obtained a June 30, 1998 loan from Countrywide secured by a first mortgage; Bank of New York claimed the note in 2006 foreclosure filings but Countrywide did not assign the loan to BNY until March 8, 2007; BNY initiated foreclosure December 27, 2006; after discussion, Wrights paid off by obtaining a new loan and foreclosure was dismissed; Wrights alleged negligence, fraud, conspiracy, and breach of fiduciary duty against Countrywide, Bank of New York, and Shapiro & Felty with Gutkoski; trial court dismissed all claims for failure to state a claim; the Wrights appeal challenging the dismissal on several theories; the court applies Civ.R. 12(B)(6) de novo standard of review; precedents include Traxler and Stuart regarding real party in interest for foreclosure.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Negligence against Countrywide/BNY based on real party in interest | Wrights claim Bank of New York lacked standing; Countrywide negligent for not guaranteeing proper process | BNY real party in interest; filing valid under Stuart/Traxler; no negligence shown | Dismissed; no viable negligence claim against Countrywide/BNY given real party in interest rule |
| Negligence against Bank of New York unless real party in interest established | BNY lacked standing at filing; Countrywide assignment pending; negligence stated | BNY could file foreclosure before assignment if real party in interest cited; proper under Traxler/Stuart | Dismissed; failure to state negligence claim where Bank of New York was real party in interest at filing |
| Fraud claims pled with particularity | Defendants improperly represented Bank of New York held the note/mortgage | No intent to mislead shown; representation not material per Stuart/Traxler; assignment occurred | Overruled; fraud allegations insufficiently pled with particularity and not material given assignment timing |
| Civil conspiracy claims | Conspiracy to commit fraud based on improper foreclosure methodology | Underlying unlawful act required; no viable fraud claim established | Overruled; conspiracy claims fail without underlying tort |
| Economic loss rule applicability | Economic loss rule should not bar negligence claims in foreclosure context | Rule moot after resolution of other issues | Mooted by disposition of other assignments |
Key Cases Cited
- Stuart, 2007-Ohio-1483 (Ohio (9th Dist.) 2007) (foreclosure standing and real party in interest timing; assignment can follow filing)
- Traxler, 2010-Ohio-3940 (Ohio (9th Dist.) 2010) (real party in interest sufficient timing of assignment; filing can precede assignment)
- Robinson v. Bates, 2006-Ohio-6362 (Ohio St.) (negligence elements: duty, breach, causation, injury)
- Cohen v. Lamko, Inc., 10 Ohio St.3d 167 (Ohio 1984) (fraud/mistake elements; Civ.R. 9(B) particularity requirement)
- Hamblin v. Daugherty, 2007-Ohio-5893 (Ohio 9th Dist. 2007) (fraud allegations must include time, place, content)
- Williams v. Aetna Fin. Co., 83 Ohio St.3d 464 (Ohio 1998) (underlying unlawful act required for civil conspiracy)