HUNTINGTON NATIONAL BANK v. ROSALIE A. ANDERSON, et al.
C.A. No. 17CA011223
IN THE COURT OF APPEALS NINTH JUDICIAL DISTRICT
September 28, 2018
[Cite as Huntington Natl. Bank v. Anderson, 2018-Ohio-3936.]
CARR, Judge.
STATE OF OHIO, COUNTY OF LORAIN ss: APPEAL FROM JUDGMENT ENTERED IN THE COURT OF COMMON PLEAS COUNTY OF LORAIN, OHIO CASE No. 16CV190291
Dated: September 28, 2018
CARR, Judge.
{¶1} Plaintiff-Appellant Huntington National Bank (“Huntington“) appeals from the judgment of the Lorain County Court of Common Pleas. This Court reverses.
I.
{¶2} In February 2009, Defendant-Appellee Rosalie Anderson signed an $181,319 note in favor of Huntington for certain real property located on Stonegate Circle in North Ridgeville (“the Property“). The FHA-insured loan was secured by a mortgage on the Property in favor of Mortgage Electronic Registration Systems, Inc., as nominee for Huntington. In 2012, the mortgage was assigned to Huntington.
{¶3} On August 19, 2016, Huntington filed a complaint in foreclosure with reformation against Ms. Anderson and other Defendants. Therein, Huntington sought reformation of the mortgage deed, alleging that it contained a scrivener‘s error. In addition, Huntington alleged that it was the holder of, and/or entitled to enforce, the note and mortgage, that there had been a
{¶4} Ms. Anderson answered the complaint. Ms. Anderson specifically denied that Huntington complied with all conditions precedent. She denied that Huntington had complied with the requirements of section 6(B) of the note and 9 of the mortgage. Ms. Anderson denied that Huntington sent the certified letter and made the property visit “both in order to arrange a face-to-face meeting with [Ms.] Anderson, at all, or, alternatively, within the time strictures set forth in the regulatory basis of this requirement found at
{¶5} Huntington sought leave to file an amended complaint, which was ultimately granted. In the amended complaint, Huntington included language indicating the original note was lost. Additionally, unlike the copy of the note attached to the complaint, the copy of the note attached to the amended complaint included a blank endorsement.
{¶6} Ms. Anderson then filed a motion to dismiss the amended complaint for failure to state a claim upon which relief may be granted. The magistrate denied the motion, and Ms. Anderson filed a motion to set aside the ruling of the magistrate. The trial court denied the motion to set aside.
{¶7} Ms. Anderson answered the amended complaint asserting that, aside from her included response to the new allegations, she stood “on her original Answer, including, but not limited to, its specific and particular denials of [Huntington‘s] satisfaction of the conditions precedent to foreclosure[.]”
{¶9} Huntington maintained that it was the holder of the note and assignee of the mortgage, that Ms. Anderson was in default by failing to make payments due from September 1, 2015, and that all conditions precedent under the note and mortgage had been met. Additionally, it asserted it was entitled to reformation of the mortgage deed.
{¶10} Huntington asserted that, because it sent a letter via certified mail and made multiple property visits, it complied with the face-to-face meeting requirements of
{¶11} Ms. Anderson opposed the motion asserting Huntington was not entitled to judgment because it did not satisfy all conditions precedent as it did not comply with
{¶12} The trial court ultimately concluded that Huntington failed to comply with
{¶13} Huntington has appealed, raising two assignments of error for our review.
II.
{¶14} Before addressing the merits, we pause to note a procedural irregularity. Only Huntington moved for summary judgment, yet, the trial court, instead of entering judgment in Huntington‘s favor or finding genuine issues of material fact remained for trial, entered a judgment of dismissal in favor of a nonmoving party, i.e. Ms. Anderson. See Bank of Am., N.A. v. Edwards, 9th Dist. Lorain Nos. 15CA010848, 15CA010851, 2017-Ohio-4343, ¶ 8; but see State ex rel. J.J. Detweiler Ents., Inc. v. Warner, 103 Ohio St.3d 99, 2004-Ohio-4659, ¶ 13 (“While
THE TRIAL COURT ERRED IN DISMISSING THE COMPLAINT.
{¶15} Huntington argues in its first assignment of error that the trial court erred in dismissing the complaint. Huntington argues that its failure to comply with the timelines in
{¶16} While the trial court technically dismissed the complaint without prejudice, it did so in the context of a motion for summary judgment, and, in essence, effectively awarded summary judgment to Ms. Anderson, at least with respect to Huntington‘s claims seeking foreclosure. See Fifth Third Mtge. Co. v. Berman, 10th Dist. Franklin No. 15AP-394, 2015-Ohio-4466, ¶ 13.
{¶17} This Court reviews an award of summary judgment de novo. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105 (1996). This Court applies the same standard as the trial court, viewing the facts in the case in the light most favorable to the non-moving party and resolving any doubt in favor of the non-moving party. Viock v. Stowe-Woodward Co., 13 Ohio App.3d 7, 12 (6th Dist.1983).
{¶18} Pursuant to
(1) No genuine issue as to any material fact remains to be litigated; (2) the moving party is entitled to judgment as a matter of law; and (3) it appears from the evidence that reasonable minds can come to but one conclusion, and viewing such evidence most strongly in favor of the party against whom the motion for summary judgment is made, that conclusion is adverse to that party.
Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977).
{¶20} We will dispose of Huntington‘s latter argument first. Huntington did not argue below that the regulations were inapplicable in light of Ms. Anderson‘s discharge in bankruptcy. This Court has held on multiple occasions that “[a]rguments that were not raised in the trial court cannot be raised for the first time on appeal.” JPMorgan Chase Bank, N.A. v. Burden, 9th Dist. Summit No. 27104, 2014-Ohio-2746, ¶ 12. Accordingly, this Court will not address this argument.
{¶21} Huntington‘s primary argument is that, given the entire scheme of the federal regulations, because Huntington complied with the substantive components of
{¶23} This Court has concluded that “where compliance with HUD regulations is required by a note and mortgage, such compliance is a condition precedent to bringing a foreclosure action.” Wells Fargo Bank, N.A. v. Awadallah, 9th Dist. Summit No. 27413, 2015-Ohio-3753, ¶ 21.
{¶24}
(b) The mortgagee must have a face-to-face interview with the mortgagor, or make a reasonable effort to arrange such a meeting, before three full monthly installments due on the mortgage are unpaid. If default occurs in a repayment plan arranged other than during a personal interview, the mortgagee must have a face-to-face meeting with the mortgagor, or make a reasonable attempt to arrange such a meeting within 30 days after such default and at least 30 days before foreclosure is commenced, or at least 30 days before assignment is requested if the mortgage is insured on Hawaiian home land pursuant to section 247 or Indian land pursuant to section 248 or if assignment is requested under § 203.350(d) for mortgages authorized by section 203(q) of the National Housing Act.
(c) A face-to-face meeting is not required if:
(1) The mortgagor does not reside in the mortgaged property,
(2) The mortgaged property is not within 200 miles of the mortgagee, its servicer, or a branch office of either,
(3) The mortgagor has clearly indicated that he will not cooperate in the interview,
(4) A repayment plan consistent with the mortgagor‘s circumstances is entered into to bring the mortgagor‘s account current thus making a meeting unnecessary, and payments thereunder are current, or
(5) A reasonable effort to arrange a meeting is unsuccessful.
(d) A reasonable effort to arrange a face-to-face meeting with the mortgagor shall consist at a minimum of one letter sent to the mortgagor certified by the Postal Service as having been dispatched. Such a reasonable effort to arrange a face-to-face meeting shall also include at least one trip to see the mortgagor at the mortgaged property, unless the mortgaged property is more than 200 miles from the mortgagee, its servicer, or a branch office of either, or it is known that the mortgagor is not residing in the mortgaged property.
{¶25} Huntington has never argued that it conducted a face-to-face meeting with Ms. Anderson. Instead, it argues that it made a reasonable effort to arrange such a meeting as defined by
{¶26} Huntington points to decisions from the Seventh, Fifth, and Second District Courts of Appeals in support of its arguments. It notes that the Seventh District concluded that “the obligation to perform the conditions is mandatory but the specific time deadlines are ‘aspirational.‘” Bank of Am. v. Bobovyik, 7th Dist. Columbiana No. 13 CO 54, 2014-Ohio-5499, ¶ 35, quoting PNC Mtge. v. Garland, 7th Dist. Mahoning No. 12 MA 222, 2014-Ohio-1173, ¶ 30. Huntington argues that to hold it to the timing requirements would be unduly harsh and would be inconsistent with the administrative scheme.
{¶27} This Court was presented with a similar set of facts in Edwards. Therein, we noted that the lender also failed to comport with
{¶28} Here, Huntington presented evidence that it did comply with the substance of the regulation. That evidence was not contested by Ms. Anderson. Thus, the only question is whether Huntington‘s failure to comply with the regulation in the timeframe outlined therein bars its foreclosure action for failure to comply with a condition precedent.
{¶29} Huntington specifically points to
{¶30} While this Court has never before expressly concluded that the timing requirement in
{¶31} Given the foregoing, we can only conclude that the trial court erred in dismissing the complaint based upon Huntington‘s failure to comply with the timing requirements in
ASSIGNMENT OF ERROR II
THE TRIAL COURT ERRED IN FAILING TO ENTER SUMMARY JUDGMENT FOR THE HUNTINGTON NATIONAL BANK.
{¶32} Huntington argues in its second assignment of error that the trial court erred in failing to enter summary judgment for it on its claims. Here, the trial court did not review the merits of Huntington‘s claims in light of its conclusion that Huntington failed to comply with a condition precedent. This Court is a reviewing court and its role is not to decide matters in the first instance. See Catalanotto v. Byrd, 9th Dist. Summit No. 27824, 2016-Ohio-2815, ¶ 12. Accordingly, we must remand the matter to the trial court for it to consider the merits of Huntington‘s summary judgment arguments. Huntington‘s second assignment of error is sustained to that limited extent.
{¶33} Huntington‘s assignments of error are sustained to the extent discussed above. The judgment of the Lorain County Court of Common Pleas is reversed and this matter is remanded for proceedings consistent with this opinion.
Judgment reversed, and cause remanded.
There were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Court of Common Pleas, County of Lorain, State of Ohio, to carry this judgment into execution. A certified copy of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is instructed to mail a notice of entry of this judgment to the parties and to make a notation of the mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellee.
DONNA J. CARR
FOR THE COURT
SCHAFER, P. J.
TEODOSIO, J.
CONCUR.
SCOTT A. KING and TERRY W. POSEY, JR., Attorneys at Law, for Appellant.
EDWARD F. HERMAN, Attorney at Law, for Appellee.