FV-I, Inc., in Trust for Morgan Stanley Mortgage Capital Holdings LLC v. Maria E. Lackey, et al.
No. 13AP-983
IN THE COURT OF APPEALS OF OHIO TENTH APPELLATE DISTRICT
November 6, 2014
[Cite as FV-I, Inc. v. Lackey, 2014-Ohio-4944.]
DORRIAN, J.
(C.P.C. No. 12CV004862) (REGULAR CALENDAR)
Rendered on November 6, 2014
Jason Whitacre and Stefani L. Deka, for appellee.
Mills, Mills, Fiely & Lucas, LLC, and Brian D. Flick; Kendo, Alexander, Cooper & Engel LLP, and Andrew Engel, for appellant.
APPEAL from the Franklin County Court of Common Pleas
DORRIAN, J.
{¶ 1} Defendant-appellant, Maria E. Lackey (“appellant“), appeals from a judgment of the Franklin County Court of Common Pleas granting summary judgment in favor of plaintiff-appellee, FV-I, Inc., in Trust for Morgan Stanley Mortgage Capital Holdings, LLC (“appellee“), on its complaint for foreclosure. Because we conclude that the trial court erred by granting judgment in an amount exceeding the face value of the note and that there was a genuine issue of material fact as to whether appellee was entitled to enforce the note, we reverse.
{¶ 3} Appellee moved for summary judgment, asserting that there were no genuine issues of material fact and that it was entitled to judgment as a matter of law. In support of its motion for summary judgment, appellee attached an affidavit from Mark McCloskey (“McCloskey“), an employee of appellee‘s loan servicing agent, Specialized Loan Servicing, L.L.C. McCloskey attested that he had examined and had personal knowledge of appellant‘s loan account, that appellant was in default under the terms of the Note, and that there was an unpaid principal balance on appellant‘s loan account of $103,971.23. McCloskey also attested to the assignment history of the Mortgage from First Franklin to appellee. McCloskey also attested to the accuracy of certain correspondence sent to appellant regarding her loan account.
{¶ 4} The trial court granted summary judgment in favor of appellee, awarding judgment on the Note for $103,971.23, plus accrued interest, as well as late charges due under the Note and Mortgage, advances made for the payment of taxes, assessments, and insurance premiums, and the costs and expenses incurred for enforcement of the Note and Mortgage. The trial court also ordered foreclosure of the Mortgage and sale of the property conveyed under the Mortgage.
{¶ 5} Appellant appeals from the trial court‘s judgment, assigning three errors for this court‘s review:
ASSIGNMENT OF ERROR No. 1
The trial court erred in overruling Lackey‘s Motion to Strike.
ASSIGNMENT OF ERROR No. 2
The trial court erred in granting LV-1‘s [sic] Motion for Summary Judgment.
ASSIGNMENT OF ERROR No. 3
The trial court erred in certifying its judgment as a final appealable order.
{¶ 6} We begin with appellant‘s third assignment of error, which implicates the jurisdiction of this court. Courts of appeals have jurisdiction to review final orders of lower courts.
{¶ 7} A trial court order is final and appealable if it meets the requirements of
{¶ 8} In relevant part,
{¶ 10} The Supreme Court noted that, in order for a foreclosure judgment to constitute a final order, “it must address the rights of all lienholders and the responsibilities of the mortgagor.” Id. at ¶ 20. The court concluded that, although the judgment entry issued by the trial court did not specify the exact amounts due for the advances paid by the plaintiff, it foreclosed on the mortgage, set forth the principal sum and interest accrued on the note, and listed the categories of future expenses for which the defendants would be liable. Id. at ¶ 22. Therefore, the order was final and appealable because “all that remained was for the trial court to perform the ministerial task of calculating the final amounts that would arise during confirmation proceedings.” Id. at ¶ 20. If the defendants wished to contest the amounts expended for the categories set forth in the foreclosure judgment, they could do so during proceedings to confirm the foreclosure sale and could appeal the order confirming the sale. Id. at ¶ 43. The Supreme Court reversed the Fifth District‘s decision, holding that “[a] judgment decree in foreclosure that allows as part of recoverable damages unspecified amounts advanced by
{¶ 11} In this case, the trial court awarded unspecified damages for “all advances made for the payment of real estate taxes and assessments and insurance premiums.” (Judgment Entry, 2.) These were the same types of damages left unspecified in Roznowski. Therefore, the judgment entry in this case is a final, appealable order. See Chase Home Fin., L.L.C. v. Smith, 11th Dist. No. 2013-P-0017, 2014-Ohio-3767, ¶ 7 (applying Roznowski).
{¶ 12}
{¶ 13} Accordingly, we overrule appellant‘s third assignment of error.
{¶ 14} Next, we turn to appellant‘s second assignment of error, in which she asserts that the trial court erred by granting appellee‘s summary judgment motion. We review a grant of summary judgment de novo. Capella III, L.L.C. v. Wilcox, 190 Ohio App.3d 133, 2010-Ohio-4746, ¶ 16 (10th Dist.), citing Andersen v. Highland House Co., 93 Ohio St.3d 547, 548 (2001). “De novo appellate review means that the court of appeals independently reviews the record and affords no deference to the trial court‘s decision.” Holt v. State, 10th Dist. No. 10AP-214, 2010-Ohio-6529, ¶ 9 (internal citations omitted). Summary judgment is appropriate where “(1) there is no genuine issue of material fact, (2) the moving party is entitled to judgment as a matter of law, and (3) reasonable minds can come to but one conclusion, and that conclusion is adverse to the party against whom the motion for summary judgment is made.” Capella
{¶ 15} A party seeking summary judgment in a foreclosure action must demonstrate that it was entitled to enforce the note and had an interest in the mortgage on the date the complaint in foreclosure was filed. See Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, ¶ 28 (“[B]ecause [Federal Home Loan] failed to establish an interest in the note or mortgage at the time it filed suit, it had no standing to invoke the jurisdiction of the common pleas court.“); Bank of New York Mellon v. Watkins, 10th Dist. No. 11AP-539, 2012-Ohio-4410, ¶ 18 (“An entity must prove that it was the holder of the note and mortgage on the date that the complaint in foreclosure was filed, otherwise summary judgment is inappropriate.“); see also Nationstar Mtge., L.L.C. v. Van Cott, 6th Dist. No. L-12-1002, 2012-Ohio-5807, ¶ 19 (concluding that a party seeking foreclosure was not entitled to summary judgment because there was a genuine issue of material fact as to whether it owned the note or was otherwise entitled to enforce the note at the time the foreclosure complaint was filed). Appellant asserts that there was a genuine issue of material fact in this case regarding whether appellee was entitled to enforce the Note. Appellant points to the fact that appellee provided two versions of the Note, each bearing different endorsements. The version of the Note attached to the original complaint includes an allonge bearing an undated endorsement from PNC Bank, National Association, as successor by merger to First Franklin (the original lender), to appellee. The second version of the Note, which was filed with the trial court as an amended exhibit to the original complaint and also filed as an exhibit to appellee‘s amended complaint, does not have an allonge but has two endorsements stamped directly on the Note below the signature area on the last page. On
{¶ 16} Appellant argues that the two versions of the Note create a genuine issue of material fact as to whether appellee was entitled to enforce the Note, pointing to U.S. Bank, N.A. v. McGinn, 6th Dist. No. S-12-004, 2013-Ohio-8, and Deutsche Bank Natl. Trust Co. v. Holden, 9th Dist. No. 26970, 2014-Ohio-1333. In McGinn, the Sixth District Court of Appeals reversed a grant of summary judgment in a foreclosure case, concluding that a genuine issue of material fact existed because one version of the promissory note was attached to the complaint and another version was attached to the motion for summary judgment. The plaintiff seeking foreclosure was not the original lender named in the note. The plaintiff attached a copy of the note to the complaint bearing certain endorsements; it then attached to its motion for summary judgment another copy of the note bearing additional endorsements that were not present on the version attached to the complaint. McGinn at ¶ 22. The plaintiff provided an affidavit from a litigation analyst for the servicer of the loan attesting to his belief that an earlier version of the note was inadvertently attached to the complaint. Id. at ¶ 23. The court of appeals noted that personal knowledge, rather than belief, was required for an affidavit in support of a motion for summary judgment. The court further concluded that the inconsistency in the two notes was sufficient to show a genuine issue of material fact and precludes summary judgment. Id. at ¶ 25. Similarly, in Holden, the plaintiff was not the original lender. The plaintiff attached an unendorsed copy of a promissory note to its foreclosure complaint. Holden at ¶ 3. The plaintiff later filed a motion for summary judgment, attaching a copy of the note containing an undated blank endorsement made by the original lender. Id. at ¶ 9. The Ninth District Court of Appeals reversed the trial court‘s grant of summary judgment, concluding that there was a genuine issue of material fact as to whether the plaintiff was entitled to enforce the note. Id. at ¶ 15.
{¶ 17} In support of its motion for summary judgment, appellee argued that the present case is similar to Deutsche Bank Natl. Trust Co. v. Najar, 8th Dist. No. 98502, 2013-Ohio-1657, in which the Eighth District Court of Appeals concluded that “[t]he mere fact that there were two different copies of the note in the record—one with endorsements
{¶ 18} Unlike Najar, in the present case, appellee did not offer any explanation of the different versions of the Note. McCloskey‘s affidavit in support of the motion for summary judgment attests that appellee had possession of the Note and Mortgage prior to the filing of the complaint and addresses the assignment history of the Mortgage, but fails to address the two versions of the Note. Further, each version of the Note in this case contains endorsements, but the endorsements are different between the two versions. Absent any explanation for the discrepancy between the two versions of the Note, and construing the evidence in favor of appellant as the party opposing summary judgment, it appears that there is a genuine issue of material fact as to whether appellee was entitled to enforce the Note.
{¶ 19} Appellant also argues that the trial court committed plain error by granting summary judgment in an amount that exceeds the face value of the Note. Appellee argues that appellant waived this argument by failing to raise it before the trial court, which appellant appears to concede by arguing that the trial court committed plain error. Generally, “in the absence of plain error, failure to draw the trial court‘s attention to possible error at a time at which the error could have been corrected results in a waiver of the issue for purposes of appeal.” In re H.D.D., 10th Dist. No. 12AP-134, 2012-Ohio-6160, ¶ 71. In civil cases, the plain-error doctrine will only apply in the “extremely rare case involving exceptional circumstances where error, to which no objection was made at the
{¶ 20} Although appellee provided two versions of the Note bearing different endorsements, both versions indicate that the principal amount of the loan was $91,520, when the Note was issued on April 1, 2005. In both the complaint and the amended complaint, appellee asserted that it was entitled to judgment in the amount of $103,971.23, plus interest, along with other costs, charges, and advances. The trial court‘s summary judgment order found that appellant owed $103,971.23 on the Note, plus interest, and granted judgment in favor of appellee in that amount, along with “all late charges due under the Note and Mortgage, all advances made for the payment of real estate taxes and assessments and insurance premiums, and all costs and expenses incurred for the enforcement of the Note and Mortgage, except to the extent the payment of one or more specific such items is prohibited by Ohio law.” (Judgment Entry, 2.) Thus, the trial court awarded judgment in an amount greater than the face value of the Note.
{¶ 21} Appellee argues that the McCloskey affidavit attested to the amount due on the loan and identified and authenticated a payment history for the loan account, suggesting that the McCloskey affidavit provided evidence supporting its claim for judgment in excess of the face value of the Note. In the affidavit, McCloskey asserted that he had examined and had personal knowledge of appellant‘s loan account and that there was an unpaid principal balance of $103,971.23. He also attested that a copy of the payment history attached as an exhibit to the affidavit was a true and accurate representation of the activity on appellant‘s loan account. The purported account statement reflects a principal balance of $103,971.23, and includes multiple pages detailing transactions and adjustments to the account. A significant portion of the account statement consists of a spreadsheet that is reproduced in a format and size that makes it effectively illegible and incomprehensible. Thus, appellee effectively offers no explanation for the discrepancy between the face value of the Note and the purported principal
{¶ 22} Accordingly, we sustain appellant‘s second assignment of error.
{¶ 23} Finally, in appellant‘s first assignment of error, she asserts that the trial court erred by denying her motion to strike one of the exhibits to the McCloskey affidavit for lack of authentication. Because we conclude that the trial court erred by granting summary judgment in favor of appellee, appellant‘s first assignment of error is rendered moot.
{¶ 24} For the foregoing reasons, we sustain appellant‘s second assignment of error and overrule her third assignment of error. Appellant‘s first assignment of error is rendered moot. We reverse the judgment of the Franklin County Court of Common Pleas and remand this matter to that court for further proceedings in accordance with law and consistent with this decision.
Judgment reversed; cause remanded.
TYACK and O‘GRADY, JJ., concur.