Bayview Loan Servicing, L.L.C. v. Griffen , 2020 Ohio 6666 ( 2020 )

[Cite as Bayview Loan Servicing, L.L.C. v. Griffen, 2020-Ohio-6666.]
IN THE COURT OF APPEALS
TWELFTH APPELLATE DISTRICT OF OHIO
WARREN COUNTY
BAYVIEW LOAN SERVICING, LLC, et al. :
Appellees, : CASE NO. CA2020-02-013
: OPINION
- vs - 12/14/2020
:
CHERYL GRIFFEN, et al. :
Appellants. :
CIVIL APPEAL FROM WARREN COUNTY COURT OF COMMON PLEAS
Case No. 19-CV-91976
Clunk, Hoose Company LPA, Ethan J. Clunk, Robert R. Hoose, 4500 Courthouse Blvd.,
Suite 400, Stow, Ohio 44224, for appellee, Bayview Loan Servicing, LLC
John E. Sharts, 5 Fairway Drive, P.O. Box 350, Springboro, Ohio 45066-0350, for appellee,
Gary E. Powers
Gregory M. Gantt Company, L.P.A., Erik R. Blaine, Gregory M. Gantt, 130 West Second
Street, Suite 210, Dayton, Ohio 45402, for appellant, Cheryl Griffen nka White
S. POWELL, J.
{¶ 1} Appellant, Cheryl Griffen nka White ("Cheryl"), appeals the decision of the
Warren County Court of Common Pleas granting a motion to vacate the sale of real property
sold at a sheriff's sale filed by appellee, Gary E. Powers. For the reasons outlined below,
Warren CA2020-02-013
we reverse the trial court's decision and remand this matter for further proceedings.
{¶ 2} On February 19, 2019, Bayview Loan Servicing, LLC ("Bayview") filed a
complaint in foreclosure against Cheryl requesting to foreclose on real property Cheryl
owned located in Springboro, Warren County, Ohio. Cheryl did not file any responsive
pleading to Bayview's complaint, thereby prompting Bayview to file a motion for default
judgment. On July 24, 2019, the trial court granted a default judgment against Cheryl to
Bayview. After providing the proper notice to Cheryl and the public at large, the property
was then sold at a sheriff's sale on October 7, 2019. Powers purchased the property at the
sheriff's sale for $142,000.
{¶ 3} On November 6, 2019, Powers filed a motion to vacate the sheriff's sale. In
support of his motion, Powers argued that he had just been advised by Clifford Griffen, the
brother of Cheryl's ex-husband, Roger Griffen, that while Cheryl and Roger were married
Roger built the garage located on the property "knowingly and deliberately straddling the
common property line" between that property and the adjacent property owned by their now
deceased mother, Elizabeth Griffen. Powers alleged that he was also advised by Clifford
that the "garage encroachment" spanned approximately 8 or 10 feet onto Elizabeth's
property. Therefore, because the "boundary line issues and encroachment problems" were
"not discernable upon reasonable visual inspection," Powers argued that the sheriff's sale
of the property should be vacated.
{¶ 4} On November 20, 2019, Bayview filed a memorandum in opposition to
Powers' motion to vacate the sheriff's sale. Two days later, on November 22, 2019, Powers
filed an untitled memorandum in support of his motion to vacate. Powers' memorandum
was supported by an affidavit filed by Powers' counsel, Attorney John E. Sharts. Powers'
memorandum, along with Attorney Sharts' affidavit, provided a detailed overview of the
ownership interests in the two adjacent properties at issue. This includes the following
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passage taken from the penultimate paragraph of Powers' memorandum:
[A] succession of intestate deaths ultimately left Elizabeth with
an undivided one-third (1/3rd) interest in the premises
encumbered by [a] Medicaid lien, with her four children holding
even prior to her death the other undivided two-thirds (2/3rds)
interest among them with and without dower, they now
additionally acceding to her encumbered interest. One of them,
Roger, straddles this line as well: He and his ex-wife constructed
the encroachment on the subject premises, and he is a
fractional owner of his deceased Mother's property on the other
side, and the Medicaid lien in entirety exceeds the aggregate
value of the immediate neighborhood in its entirely (sic).
{¶ 5} On December 2, 2019, Bayview filed a notice that it was withdrawing its
memorandum in opposition to Powers' motion to vacate the sheriff's sale. Cheryl, however,
did not file any response either in favor of or in opposition to Powers' motion to vacate .
{¶ 6} On January 6, 2020, Powers filed a Civ.R. 60(B) motion for relief from
judgment. Powers' motion incorporated by reference his own affidavit, as well as a
"supplemental" affidavit filed by Attorney Sharts. As part of his affidavit, Powers averred
that he had conducted only a "visual inspection" of the property prior to the sheriff's sale.
Powers also averred that he had contacted the Warren County Sheriff's Sale Clerk "in alarm
about the reported encroachment" shortly after learning about the alleged "encroachment
problem" from Clifford and that he would not have bid on the property had he been aware
of this problem prior to the sheriff's sale.
{¶ 7} In his "supplemental" affidavit, Attorney Sharts averred that, after consulting
with Powers, he had accessed the Warren County Geographical Information Systems
("GIS") and confirmed that there was an "encroachment problem" with the two adjacent
properties. This is evidenced by a clear depiction of the garage straddling the property line
between the two adjacent properties.
{¶ 8} On January 15, 2020, Cheryl moved to strike Powers' Civ.R. 60(B) motion for
relief from judgment and the accompanying affidavits filed by Powers and Attorney Sharts.
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Cheryl argued that Powers' motion for relief from judgment should be stricken because
Powers, as the successful bidder of the property, lacked standing to participate in the case
to challenge the sheriff's sale. Cheryl also argued that Powers' motion should be stricken
since there was no judgment that Powers could seek relief from given the fact that the trial
court had yet to confirm the sale. There is no dispute that the trial court had not, and still
has not, confirmed the sheriff's sale of the property subject to this appeal.
{¶ 9} On February 18, 2020, the trial court issued a decision denying Cheryl's
motion to strike. The trial court also denied Powers' motion for relief from judgment. The
trial court, however, granted Powers' motion to vacate the sheriff's sale. In so holding, the
trial court found Powers had standing to participate in the case because it would be
"inequitable" for it to "decide matters which involve and impact Mr. Powers prior to the sale
confirmation without allowing him to participate." The trial court also found the "garage
encroachment onto the neighboring property was not a reasonably ascertainable defect
from a visual inspection of the property," thereby making it proper for the sheriff's sale to be
vacated and Powers' deposit be returned to him. Cheryl now appeals, raising two
assignments of error for review.1
{¶ 10} Assignment of Error No. 1:
{¶ 11} THE TRIAL COURT ERRED WHEN IT GRANTED POWERS' MOTION TO
VACATE THE SHERIFF'S SALE DUE TO THE WELL ESTABLISHED PRINCIPLE OF
CAVEAT EMPTOR.
{¶ 12} In her first assignment of error, Cheryl argues the trial court erred by granting
Powers' motion to vacate the sheriff's sale of the property.
{¶ 13} The trial court's decision whether to grant a motion to vacate a sheriff's sale
1. We note that the trial court has since granted Cheryl's motion to stay pending appeal of the distribution of
the proceeds from the sheriff's sale and the return of Powers' deposit.
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prior to the confirmation of the sale is reviewed under an abuse of discretion standard. See
Countrywide Home Loans Servicing, L.P. v. Nichpor, 6th Dist. Wood No. WD-15-004, 2016
Ohio App. LEXIS 2938, *3 (Apr. 22, 2016); see also Wells Fargo Bank, N.A. v. Fortner, 2d
Dist. Montgomery 26010, 2014-Ohio-2212, ¶ 8-9. "A decision constitutes an abuse of
discretion when the trial court acted unreasonably, arbitrarily, or unconscionably." Wells
Fargo Bank v. Maxfield, 12th Dist. Butler No. CA2016-05-089, 2016-Ohio-8102, ¶ 32, citing
Bank of Am., N.A. v. Jackson, 12th Dist. Warren No. CA2014-01-018, 2014-Ohio-2480, ¶
9. "'A decision is unreasonable if there is no sound reasoning process that would support
that decision.'" Stidham v. Wallace, 12th Dist. Madison No. CA2012-10-022, 2013-Ohio-
2640, ¶ 8, quoting AAAA Enterprises, Inc. v. River Place Community Urban Redevelopment
Corp., 50 Ohio St. 3d 157, 161 (1990). "When applying an abuse of discretion standard, we
are not free to merely substitute our judgment for that of the trial court." BAC Home Loans
Servicing, L.P. v. Mapp, 12th Dist. Butler No. CA2013-10-193, 2014-Ohio-2005, ¶ 29.
{¶ 14} Cheryl initially argues the trial court erred by granting Powers' motion to
vacate the sheriff's sale because Powers did not have standing to appear and participate
in the case to protect the interest he acquired by being the successful bidder of the property
at the sheriff's sale. We disagree.
{¶ 15} Although it appears Powers would not have had standing to appeal "regarding
the granting or denying of confirmation of said sale," Bank of N.Y. v. Rains, 12th Dist. Butler
No. CA2012-04-092, 2013-Ohio-2389, ¶ 27, citing Ohio Savings Bank v. Ambrose, 56 Ohio
St.3d 53, 55 (1990), once he became the successful bidder of the property at the sheriff's
sale, Powers had standing to appear and participate in the proceedings before the trial court
to protect his newly acquired interest in the property. This holds true despite the fact that
Powers did not first move the trial court to allow him to intervene in the case. See, e.g.,
Treasurer v. Kafele, 10th Dist. Franklin No. 05AP-252, 2005-Ohio-6618, ¶ 8 ("once [the
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buyer] became the successful bidder at sheriff's sale, he had standing to appear in the trial
court and to move to protect his acquired interest in the property, although better practice
may have been to move to intervene prior to doing so"). Cheryl's claim otherwise lacks
merit.
{¶ 16} Cheryl also argues the trial court erred by granting Powers' motion to vacate
the sheriff's sale because the sale was governed by the doctrine of caveat emptor, i.e., let
the buyer beware. We agree.
{¶ 17} The doctrine of caveat emptor applies in all its rigor to purchasers at judicial
sales like the sheriff's sale in this case. Holley v. Haynes, 4th Dist. Meigs No. 450, 1991
Ohio App. LEXIS 3934, *7 (Aug. 8, 1991). "[U]nder this doctrine, a purchaser of real estate
at a judicial sale will be charged with knowledge of an alleged defect in [the] title where the
conditions are of public record and are easily discoverable by the purchaser." LaSalle Bank
Natl. Assn. v. Brown, 2d Dist. Montgomery No. 25822, 2014-Ohio-3261, ¶ 47. "The duty of
examining public records is especially incumbent upon a person who purchases property
at a judicial sale, because in this instance the duty is based not only on general ground, but
also on the consideration that the maxim, caveat emptor, applies with full force to a
transaction of this character." Roos v. H.W. Roos, 1st Dist. Hamilton No. 5641, 1940 Ohio
App. LEXIS 1108, *39 (Nov. 4, 1940). "[T]he purchaser at a judicial sale is bound to
examine the title to the land himself and if he fails to do so, he must suffer the loss caused
by that failure." Spence v. First Federal Sav. & Loan Assn., 6th Dist. Fulton No.
91FU000020, 1992 Ohio App. LEXIS 4260, *12 (Aug. 21, 1992).
{¶ 18} "'[I]n the absence of fraud or express warranty the purchaser has no relief
against a defect in the title or any restrictions appertaining to said property, nor has a
purchaser at such sale any relief for any unsuitableness of the land for any particular
purpose which an examination that he was free to make would have revealed.'"
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Commercial Natl. Bank v. Zeis, 3rd Dist. Seneca No. 13-86-3, 1987 Ohio App. LEXIS 9129,
*5-6 (Oct. 13, 1987), quoting King v. Newark Trust Co., Licking C.P. No. 41123, 1957 Ohio
Misc. LEXIS 306 (June 25, 1957). The record indicates that Powers conducted a visual
inspection of the property prior to the sheriff's sale. Powers, however, did not conduct any
further investigation of the property via any of the public records available to him. This
includes, for instance, Powers' failure to investigate the property through the publicly
accessible Warren County GIS website. The record instead indicates that search was done
only after Powers consulted with Attorney Sharts. The purchaser "buys with his eyes open,
at his own risk, and is without [recourse] in case there is a defect in the title of the former
owner of the property bought." Kain v. Weitzel, 72 Ohio App. 229, 233 (1st Dist.1943). This
holds true regardless of whether the mortgagee, in this case Bayview, has objected to the
sheriff's sale being vacated.
{¶ 19} In light of the foregoing, although we certainly understand the difficulties that
Powers may now incur by having the sale of the property reinstated in this case, we believe
those difficulties are the direct result of Powers' own failure to act with the necessary due
diligence prior to submitting his winning bid for the property. "[T]he primary purpose of the
judicial sale is to protect the interest of the mortgagor-debtor and to promote a general
policy which provides judicial sales with a certain degree of finality." Society Natl. Bank v.
Wolff, 6th Dist. Sandusky No. S-90-13, 1991 Ohio App. LEXIS 1821, *9 (Apr. 26, 1991);
CitiMortgage, Inc. v. Roznowski, 139 Ohio St. 3d 299, 2014-Ohio-1984, ¶ 23 (emphasizing
"that a judgment decree in foreclosure is a final order and that judicial sales have a certain
degree of finality"); Countrywide Home Loans Servicing, L.P. v. Nichpor, 136 Ohio St. 3d
55, 2013-Ohio-2083, ¶ 7 (noting that "judicial sales have a certain degree of finality"). To
hold otherwise, thereby allowing the sheriff's sale to be vacated, would significantly thwart
that purpose. Therefore, to the extent outlined above, Cheryl's first assignment of error has
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merit and is sustained. The trial court's order granting Powers' motion to vacate is reversed.
{¶ 20} Assignment of Error No. 2:
{¶ 21} THE TRIAL COURT ERRED BY DENYING THE MOTION TO VACATE, (sic)
THE AFFIDAVIT OF GARY E. POWERS, AND THE SUPPLEMENTAL AFFIDAVIT OF
JOHN E. SHARTS.
{¶ 22} In her second assignment of error, Cheryl argues the trial court erred by
denying her motion to strike the affidavits submitted by Powers and Attorney Sharts in
support of Powers' Civ.R. 60(B) motion for relief from judgment. Cheryl supports this
argument by again alleging that Powers did not have standing to appear and participate in
this case. However, as discussed more fully above, Powers had standing to appear and
participate in this case as the winning bidder of the property at the sheriff's sale. This holds
true despite the fact that the trial court has yet to confirm the sale of the property. Therefore,
based on the facts and circumstances here, we find no abuse of discretion in the trial court's
decision to deny Cheryl's motion to strike. See Bank of N.Y. Mellon v. Putman, 12th Dist.
Butler No. CA2012-12-267, 2014-Ohio-1796, ¶ 9 (a trial court's ruling on a motion to strike
will not be reversed on appeal absent an abuse of discretion). Accordingly, finding no error
in the trial court's decision, Cheryl's second assignment of error lacks merit and is overruled.
{¶ 23} Judgment affirmed in part, reversed in part, and remanded.
HENDRICKSON, P.J., and RINGLAND, J., concur.
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