Wells Fargo Bank v. RamseyWells Fargo Bank v. Ramsey
For Plaintiff-Appellee Attorney Scott A. King, Attorney Terry W. Posey, Jr., 10050 Innovation Drive, Suite 400, Miamisburg, Ohio 45342
For Defendant-Appellant Attorney Bruce M. Broyles, 5815 Market Street, Suite 2, Boardman, Ohio 44512
{¶1} Plaintiffs-appellants Kira S. Ramsey and Jeffrey A. Ramsey appeal the judgment of the Mahoning County Common Pleas Court adopting a magistrate‘s bench-trial decision in favor of defendant-appellee Wells Fargo Bank, N.A. in its foreclosure action.
{¶2} In 2007, the Ramseys signed a note for $115,783 and executed a corresponding mortgage on 8937 Duck Creek, Salem, OH 44460 with Wells Fargo. The Ramseys defaulted and Wells Fargo filed for foreclosure on October 6, 2011. Wells Fargo‘s complaint specifically alleged, “Plaintiff has complied with all conditions precedent and has declared the entire balance due and payable.” (10/06/2011 Complaint, ¶ 5.)
{¶3} Initially, the Ramseys did not respond and Wells Fargo moved for default judgment. However, the trial court allowed the Ramseys to file a late answer and, accordingly, denied Wells Fargo‘s default judgment motion. In their answer, the Ramseys alleged:
Defendants say that Plaintiff did not provide the proper notice of default and/or acceleration required by the Promissory Note and the Mortgage and that Plaintiff is not entitled to a judgment on the entire balance of the promissory note or to a decree of foreclosure of the entire mortgage.
Defendants say that plaintiff failed to comply with all the regulations of the Secretary prior to accelerating the balance due and prior to filing the complaint for foreclosure. * * *
(03/28/2012 Answer, ¶¶ 9-10.)
{¶4} Wells Fargo moved for summary judgment on July 30, 2012. It attached an affidavit as to the default and the amount due. The affidavit also authenticated the attached note, mortgage, and notice of default/acceleration.
{¶5} On August 17, 2012, the Ramseys filed a brief in opposition to Wells Fargo‘s summary judgment motion. Because the Ramseys’ loan was insured by the
{¶6} In their brief in opposition to Wells Fargo‘s summary judgment motion, the Ramsey‘s argued that Wells Fargo failed to fulfill three conditions precedent to foreclosure. First, they argued that the notice of default/acceleration failed to set forth a specific dollar amount. Second, they argued that Wells Fargo had failed to conduct a face-to-face meeting in violation of HUD regulations and supported this assertion with an affidavit executed by Kira Ramsey. Third, they argued that Kira Ramsey‘s affidavit raised an issue of whether Wells Fargo made a “legitimate” effort to evaluate the Ramseys for loss mitigation, claiming that Wells Fargo had not made any response to their efforts to submit financial documents.
{¶7} Wells Fargo responded with a reply to the Ramseys’ memorandum in opposition to summary judgment on September 13, 2012. First, concerning the Ramseys’ argument that the notice of default/acceleration failed to provide a specific dollar amount that must be paid, Wells Fargo pointed out that the letter identified an amount of $1,996.53 that was necessary to avoid acceleration. Wells Fargo pointed out that the amount needed to bring the loan current included interest that continued to accumulate the longer the Ramseys failed to make a payment, and therefore could not be calculated in advance in the absence of knowledge of when, if ever, the Ramseys would submit a payment. Second, as for the face-to-face meeting, Wells Fargo contended that it sent the Ramseys a letter attempting to arrange such a meeting on June 22, 2011, and that the Ramseys never responded. Wells Fargo attached a copy of the letter to its reply in addition to an affidavit authenticating the letter. And third, Wells Fargo maintained that it had complied with HUD requirements for loss mitigation evaluation. In support, Wells Fargo pointed to the July 9, 2011 notice of default/acceleration wherein Wells Fargo offered the Ramseys a face-to-
{¶8} Following a hearing on the matter, the magistrate filed a decision on October 19, 2012, overruling Wells Fargo‘s summary judgment motion. Based upon what he perceived as conflicting affidavits, the magistrate found that genuine issues of material fact existed concerning Wells Fargo‘s compliance with all applicable loss mitigation regulations and whether it advised the Ramseys to default on the mortgage in order to obtain loss mitigation assistance.
{¶9} The matter proceeded to a bench trial before the magistrate on May 23, 2013. Following the trial, each of the parties submitted post-trial briefs. In its post-trial brief, Wells Fargo cited to and attached selected pages presumably taken from the transcript of the May 23, 2013 trial. The Ramseys filed a motion objecting to and seeking to have the trial court strike the portions of the trial transcript that Wells Fargo had attached to its post-trial brief.
{¶10} In a decision filed July 3, 2013, the magistrate overruled the Ramseys’ motion to strike. The magistrate also entered judgment in favor of Wells Fargo finding that the Ramseys in their answer had failed to deny the performance or occurrence of conditions precedent with sufficient specificity and particularity as required by
{¶11} The Ramseys filed objections to the magistrate‘s decision essentially arguing that Wells Fargo had not complied with HUD regulations, and Wells Fargo responded. In a decision filed August 6, 2013, the trial court adopted the magistrate‘s decision and entered judgment and decree in foreclosure on August 13, 2013. This appeal followed.
{¶12} The Ramseys raise two assignments of error. Before reaching those
{¶13} The civil rules do not directly address whether a litigant can rely on only select pages of the trial transcript. As it regards matters proceeding before a magistrate, some guidance can be found in
{¶14} In this case, however, the appellate rules provide more pertinent guidance. Pursuant to
{¶15} Nonetheless, under the facts and circumstances of this case, if Wells Fargo‘s attachment of only select pages of the trial transcript to its post-trial brief is considered error, it can be characterized, at most, as only harmless error.
{¶16} Turning to the Ramseys’ assignments of error, they raise two assignments of error.
{¶17} The Ramseys first assignment of error states:
The trial court erred in finding that Appellants waived the defense that Appellee failed to comply with the conditions precedent to the acceleration of the debt and the filing of the foreclosure complaint.
{¶18} The parties do not dispute that the Ramseys’ loan and mortgage were subject to HUD regulations. Paragraph 9(d) of the mortgage stated:
Regulations of HUD Secretary. In many circumstances regulations issued by the Secretary will limit Lender‘s rights, in the case of payment defaults, to require immediate payment in full and foreclose if not paid. This Security Agreement does not authorize acceleration or foreclosure if not permitted by regulations of the Secretary.
{¶19} On appeal, the Ramseys contend that Wells Fargo did not comply with HUD regulations, particularly
{¶20}
{¶21} Here, Wells Fargo‘s complaint specifically alleged, “Plaintiff has complied with all conditions precedent and has declared the entire balance due and payable.” (10/06/2011 Complaint, ¶ 5.) This was sufficient under
{¶22} In their answer, the Ramseys’ allegations regarding non-compliance with HUD regulations were general in nature, failing to cite to any specific regulations:
Defendants say that Plaintiff did not provide the proper notice of default and/or acceleration required by the Promissory Note and the Mortgage and that Plaintiff is not entitled to a judgment on the entire balance of the promissory note or to a decree of foreclosure of the entire mortgage.
Defendants say that plaintiff failed to comply with all the regulations of the Secretary prior to accelerating the balance due and prior to filing the complaint for foreclosure. * * *
(03/28/2012 Answer, ¶¶ 9-10.)
{¶23} In PNC Mtge. v. Garland, 7th Dist. No. 12 MA 222, 2014-Ohio-1173, this court evaluated the sufficiency of very similar language contained in a borrower‘s
11. Plaintiff failed to comply with the regulations issued by the Secretary of Housing and Urban Development in order to require immediate payment in full and Plaintiff failed to comply with HUD regulations prior to acceleration of the amounts due under the promissory note.
12. Plaintiff failed to comply with the regulations issued by the Secretary of Housing and Urban Development in order to require immediate payment in full and Plaintiff failed to comply with HUD regulations prior to acceleration of the amounts due under the mortgage.
{¶24} Like the borrower in Garland, the Ramseys here failed to state with the specificity required by
{¶25} Lastly, under this assignment of error, the Ramseys argue that it was Wells Fargo that waived their failure to state with the specificity required by
{¶26} This court‘s holding in Garland precludes this argument as well. As this court held in Garland, a borrower‘s failure to state with the specificity required by
{¶27} Furthermore, the Ramseys did not comply with
When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time, even after judgment.
{¶28} “Although issues not raised in the pleadings may be treated as if they had been raised in the pleadings when tried by express or implied consent of the parties,
{¶29} Accordingly, the Ramseys’ first assignment of error is without merit.
{¶30} The Ramseys’ second assignment of error states:
The trial court‘s decision is against the manifest weight of the evidence.
{¶31} The Ramseys argue that the magistrate‘s decision and the trial court‘s adoption of it were against the manifest weight of the evidence because the evidence showed that Wells Fargo accelerated the loan while they were still being evaluated for loss mitigation. In support, the Ramseys cite this court‘s decision in Wells Fargo Bank, N.A. v. Aey, 7th Dist. No. 12 MA 178, 2013-Ohio-5381.
{¶32} In Aey, this court observed:
Both the note and mortgage provide that it is not only the right to foreclose that will be affected by the non-compliance but also the right to accelerate and require immediate payment that will be affected. We also note that if a loss mitigation evaluation is required, then the right to accelerate (which required full payment) and then obtain a judgment based upon that acceleration would not arise until after the evaluation is complete since a successful loss mitigation can include reinstatement options, which necessarily preclude a judgment for the entire balance. Under such circumstances, when reversing summary judgment due to a genuine issue of material fact regarding compliance with HUD regulations, we shall not permit the entry of summary judgment on the note to stand.
{¶33} At trial, a witness for Wells Fargo testified about a demand letter that was sent from Wells Fargo to the Ramseys dated June 5, 2011, informing the
{¶34} The Ramseys argument under this assignment of error is precluded by the conclusion proposed under their first assignment of error. As indicated under their first assignment of error, because the Ramseys failed to state with the specificity required by
{¶35} Even if this court were able to reach the substantive merits of the Ramseys argument herein, it would still fail. As indicated, Wells Fargo sent the Ramseys a demand letter June 5, 2011, giving them 30 days to cure the default prior to acceleration of the note and mortgage. However, the August 8, 2011 entry in the collection notes on the Ramseys’ loan account referenced by them in their argument herein concerned a secondary review of their account. The witness the Ramseys are referring to also testified about a repayment plan that Wells Fargo offered the Ramseys when they first defaulted. The witness testified that Wells Fargo offered the Ramseys a repayment plan on June 15, 2011, and that they had rejected the offer. (Tr. 42, 75-76.) Thus, Wells Fargo did offer the Ramseys a reinstatement option prior to accelerating the loan and seeking foreclosure.
{¶36} Accordingly, the Ramseys’ second assignment of error is without merit.
{¶37} The judgment of the trial court is affirmed.
DeGenaro, J., concurs.