WELLS FARGO BANK, N.A. v. TIMOTHY A. STEVENS, et al.
CASE NO. 12 MA 219
STATE OF OHIO, MAHONING COUNTY IN THE COURT OF APPEALS SEVENTH DISTRICT
March 25, 2014
2014-Ohio-1399
Hоn. Cheryl L. Waite, Hon. Gene Donofrio, Hon. Mary DeGenaro
CHARACTER OF PROCEEDINGS: Civil Appeal from the Court of Common Pleas of Mahoning County, Ohio Case No. 10 CV 27. JUDGMENT: Reversed. Judgment Entry of June 23, 2011 Reinstated.
For Plaintiff-Appellant: Atty. Scott A. King, Atty. Terry W. Posey, Jr., Thompson Hine LLP, Austin Landing I, 10050 Innovation Drive, Suite 400, Dayton, Ohio 45342-4934
For Defendants-Appellees: John A. McNally, III, John A. McNally, III Co., LPA, 100 E. Federal Street, Suite 600, Youngstown, Ohio 44503
{1} This case arises from a decision to grant a
{2} Appellant argues that the Stevens did not meet at least two of the three requirements for granting relief under
Background
{3} On November 5, 2007, Timothy Stevens took out a mortgage on his home. Sometime in 2010, Wells Fargo became the holder of the promissory note and the mortgage on the house. On January 5, 2010, Wells Fargo commenced action seeking judgment on the note and foreclosure on the mortgagе.
{4} On August 31, 2010, Wells Fargo filed a motion for default judgment. On September 3, 2010, the Stevens obtained counsel and sought leave to file an answer instanter. The court allowed the delayed answer to be filed. On September 30, 2010, Wells Fargo filed a motion for summary judgment. The Stevens’ former counsel did not respond to this motion. On June 23, 2011, the trial court entered summary judgment in favor of Wells Fargo. Appellees filed a motion for stay of execution and a notice of appeal (Appeal No. 11 MA 114). Immediately after filing the appeal, Appellees’ counsel filed a motion to withdraw, which was granted. Prior to resolution of the motion for stay, Appеllees obtained new counsel, who filed the
{6} On November 16, 2011, Wells Fargo filed a response to the motion for relief from judgment. On November 21, 2011, the magistrate granted the motion. Wells Fargo filеd objections, and on October 18, 2012, the trial court overruled the objections and adopted the magistrate‘s decision. This appeal followed.
{7} An order that vacates or sets aside a final judgment is a finаl appealable order.
Assignment of Error
THE TRIAL COURT ERRED IN GRANTING THE MOTION FOR RELIEF FROM JUDGMENT.
{8} According to
{10} In order to prevаil on a motion for relief from judgment, pursuant to
{11}
{13} Appellant argues that the standard of review in this appeal should be de novo, claiming that the trial court based its discretionary decision on a misconstruction of the law. Appellant is correct that questions of law arе reviewed de novo. Graham v. Drydock Coal Co., 76 Ohio St.3d 311, 313, 667 N.E.2d 949 (1996). Nevertheless, the overall standard for reviewing a ruling on a
{14} It appears from the record that the Stevens did not satisfy all the requirements of GTE Automatic Electric, Inc. If only one of the three elements of GTE Automatic Electric, Inc. is lacking, the motion should not be granted. Volodkevich, supra. The record indiсates that the Stevens did not present a meritorious defense to the underlying cause of action. A meritorious defense is one which “[goes] to the merits, substance, or essentials of the case.” USB Real Estate Secs., Inc. v Teague, 191 Ohio App.3d 189, 196, 2010-Ohio-5634, N.E.2d 5733, ¶23 (2d Dist.2010). Although a party does not need to prove that the alleged defense will prevail at trial, enough operative facts must be alleged to show that the defense сan
{15} The defense raised by the Appellees is that the loan modification process should have prevented summary judgment from being granted to Wells Fargo. In other words, the alleged defense is that they should have been allowed to delay summary judgment by continuing negotiations with the bank. The affidavit of Timothy Stevens that was attached to the motion for relief from judgment admits that he knew the loan modifiсation would not likely be granted and “all I could hope for was to delay the foreclosure as long as possible.” (11/4/11 Motion, T. Stevens Aff., Item 11.) This is not a defense to the foreclosure action. It is, instead, a prоcedural argument about the timing of the trial court‘s judgment.
{16} As Wells Fargo has pointed out, the mere fact that loan modification talks were in progress does not constitute a defense to a foreclosure action under the first prong of GTE Automatic Electric, Inc. See, e.g., CitiMortgage, Inc. v. Dudek, 9th Dist. No. 25806, 2012-Ohio-899, ¶13; see also, Deutsche Bank Natl. Trust Co. v. Davis, 5th Dist. No. 11CAE060055, 2011-Ohio-5791, ¶23; Glendale Federal Bank v. Brown, 2d Dist. No. 17068, 1998 WL 906463 (Dec. 31, 1998). A lender has no duty to modify a loan. Davis at ¶23. Until both parties agree to the modification, the original terms of the loan are still in force, and mere negotiations are unenforceable. Huntington v. R.R. Wellington, Inc., 2012-Ohio-5935, 983 N.E.2d 941, ¶25-27 (9th Dist.). The Stevens have not alleged that any agreement was actually reached, but simply that negotiations were taking рlace.
{18} The Stevens did not present a meritorious defense to the foreclosure action and filed the motion for relief from judgment under the wrong subsection. They did not meet the requirements of
Conclusion
{19} Appellant contends that the trial court abused its discretion in granting relief from judgment in a foreclosure action. Appellant is correct. A party filing for relief from judgment under
Donofrio, J., concurs.
DeGenaro, P.J., concurs.