Farm Credit Servs. of Am. v. Pertuset

[Cite as Farm Credit Servs. of Am. v. Pertuset, 2015-Ohio-3558.]
IN THE COURT OF APPEALS OF OHIO
FOURTH APPELLATE DISTRICT
SCIOTO COUNTY
FARM CREDIT SERVICES OF : Case No. 14CA3659
MID-AMERICA PCA, :
:
Plaintiff-Appellee, :
: DECISION AND JUDGMENT
vs. : ENTRY
:
CARL PERTUSET, et al., : Released: 09/01/15
:
Defendants-Appellants. :
_____________________________________________________________
APPEARANCES:
Bruce M. Broyles, Boardman, Ohio, for Appellants.
Jeffrey B. Sams, Pickerington, Ohio, and Joshua D. Howard, Portsmouth,
Ohio, for Appellee, American Savings Bank.1
John A. Gambill, Portsmouth, Ohio, for Appellees Brandon and Jeanna
Hull.2
_____________________________________________________________
McFarland, A.J.
{¶1} This is an appeal from a Scioto County Common Pleas Court
judgment entry confirming the sale of property formerly owned by
Appellants, Carl E. and Vera M. Pertuset, which was the subject of a
previously-filed foreclosure action. On appeal, Appellants contend that the
trial court abused its discretion in confirming the Sheriff’s sale after twice
1
Farm Credit Services of Mid-America PCA has not filed a brief and is not participating on appeal.
2
These Appellees are third party purchasers of the property at issue herein and intervened at the trial court
level prior to the confirmation of the sheriff’s sale.
Scioto App. No. 14CA3659 2
previously determining that the sale was null and void and “not in
compliance with the law.” Because the confirmation of the sale was within
the exclusive discretion of the trial court, and because we cannot conclude
that the trial court abused its discretion in confirming the sale of the
property, Appellants’ sole assignment of error is without merit.
Accordingly, the decision of the trial court is affirmed.
FACTS
{¶2} Appellant’s initial appeal of this matter alleged that the trial
court had erred in granting summary judgment in favor of American Savings
Bank (hereinafter “American”) because American failed to conclusively
establish they were the proper party in interest and that they failed to
establish privity with Appellants. They also argued the trial court erred in
granting summary judgment in favor of American, claiming that American
had failed to conclusively establish the amount of their damages. While this
matter was initially pending on direct appeal, the property sold to third party
buyers at a sheriff’s sale held on November 14, 2012. This Court issued a
decision on the merits affirming the trial court’s grant of summary judgment
and decree in foreclosure on February 5, 2013.
{¶3} Subsequently, on February 28, 2013, American filed a motion to
vacate the trial court’s February 18, 2011 summary judgment grant as well
Scioto App. No. 14CA3659 3
as its August 9, 2011 decree in foreclosure, based upon a concern regarding
a potential procedural issue regarding the filing of the final judicial report
being filed after the final judgment entry, rather than before, as required by
R.C. 2329.191. Appellant did not oppose this motion, however, the third
party buyers entered an appearance through counsel, objecting to the motion
to vacate and requesting that the sale be confirmed. The trial court filed a
judgment entry on March 4, 2013 vacating its own original grant of
summary judgment and decree in foreclosure, after this Court had already
affirmed both of the those decisions on direct appeal.
{¶4} After the trial court vacated these decisions, American filed a
renewed motion for summary judgment and Appellants followed with
additional discovery requests, motions for extensions of time to conduct
discovery, and a motion to compel discovery. Finally, on June 19, 2013,
over the objection of Appellants, the trial court once again granted summary
judgment and a decree in foreclosure in favor of American. Appellants
appealed for a second time, challenging the trial court’s second grant of
summary judgment in favor of American, and also arguing that American
had failed to comply with discovery. This Court, however, determined that
the trial court lacked jurisdiction to vacate its original summary judgment
grant and decree in foreclosure and that it exceeded its authority in doing so.
Scioto App. No. 14CA3659 4
We therefore reversed the trial court’s decision vacating the original
summary judgment grant and decree in foreclosure, as well as the trial
court’s order granting American’s renewed motion for summary judgment.
Farm Credit Services of Mid-America PCA v. Carl Pertuset, et al., 4th Dist.
Scioto No. 13CA3563, 2014-Ohio-1289.
{¶5} In light of these findings, this Court further found that the
original grant of summary judgment and decree of foreclosure stood valid as
the law of the case. Subsequently, on April 24, 2014, after this Court’s most
recent decision was issued, the third party purchasers filed a motion to
intervene in the trial court, as well as a motion to confirm the sheriff’s sale.
After conducting a hearing, the trial court issued an order confirming the
sale on September 8, 2014. It is from that order that Appellants now bring
their appeal, setting forth a single assignment of error for our review. Thus,
the matter is now before us for a third time.
ASSIGNMENT OF ERROR
“I. THE TRIAL COURT ABUSED ITS DISCRETION IN
CONFIRMING THE SHERIFF’S SALE AFTER TWICE
PREVIOUSLY DETERMINING THAT THE SALE WAS NULL
AND VOID AND ‘NOT IN COMPLIANCE WITH LAW.’ ”
LEGAL ANALYSIS
{¶6} In their sole assignment of error, Appellants contend that the trial
court abused its discretion in confirming the sheriff’s sale after twice
Scioto App. No. 14CA3659 5
previously determining that the sale was null and void and “not in
compliance with law.” As set forth above, the question of whether the trial
court properly granted summary judgment and a decree in foreclosure in
favor of American has already been before this Court on direct appeal, as
well as a subsequent appeal. As this Court has affirmed the original grant of
summary judgment and decree in foreclosure, these issues remain settled at
this stage in the litigation. As such, the only issue currently on appeal is the
confirmation of the sale.
{¶7} R.C. 2329.31 governs confirmation of foreclosure sales and
provides, in relevant part, as follows:
“(A) Upon the return of any writ of execution for the
satisfaction of which lands and tenements have been sold, on
careful examination of the proceedings of the officer making
the sale, if the court of common pleas finds that the sale was
made, in all respects, in conformity with sections 2329.01 to
2329.61 of the Revised Code, it shall, within thirty days of the
return of the writ, direct the clerk of the court of common pleas
to make an entry on the journal that the court is satisfied of the
legality of such sale * * *.”
Scioto App. No. 14CA3659 6
{¶8} “[I]t has long been recognized that the trial court has discretion
to grant or deny confirmation: ‘Whether a judicial sale should be confirmed
or set aside is within the sound discretion of the trial court.’ ” Ohio Sav.
Bank v. Ambrose, 56 Ohio St. 3d 53, 55, 563 N.E.2d 1388 (1990); quoting
Michigan Mortg. Corp. v. Oakley, 68 Ohio App. 2d 83, 426 N.E.2d 1195 (1st
Dist. 1980), paragraph two of the syllabus. The trial court's exercise of
discretion “must be bottomed upon the factual situations surrounding each
sale.” Merkle v. Merkle, 116 Ohio App. 370, 372, 188 N.E.2d 170 (4th Dist.
1961). We review a trial court's decision to confirm or vacate a sheriff's sale
under an abuse of discretion standard. Commercial Federal. Mortg. Corp. v.
Sarson, 4th Dist. Lawrence No. 00CA09, 2000 WL 1257494 (Aug. 29,
2000); Hall v. Vance, 4th Dist. Highland No. 08CA16, 2009-Ohio-4945,
¶ 10. “Thus, we must fully examine the proceedings to determine their
regularity and will only reverse the trial court's confirmation of the sale if we
determine that the trial court's confirmation was unreasonable, arbitrary or
unconscionable.” Id. We are not free to merely substitute our judgment for
that of the trial court. Sarson. A trial court abuses its discretion when it is
unreasonable, arbitrary, or unconscionable. Robinette v. Bryant, 4th Dist.
Lawrence No. 14CA28, 2015-Ohio-119, ¶ 31; Cullen v. State Farm Mut.
Auto. Ins. Co., 137 Ohio St. 3d 373, 2013-Ohio-4733, 999 N.E.2d 614, ¶ 19.
Scioto App. No. 14CA3659 7
{¶9} Appellants contend that the trial court abused its discretion in
confirming the sale when it had twice previously determined that the sale
was not in compliance with the law and thus was null and void. Appellants
further contend that the trial court abused its discretion in confirming the
sale upon the motion of third party purchasers, who Appellants claim had no
vested interest in the property prior to confirmation of the sale, and when the
lender, American Savings Bank, had requested and obtained a new order of
sale.
{¶10} With respect to Appellants’ first argument, it is important to
note at this juncture that the trial court’s decision, dated March 4, 2013,
which vacated its original summary judgment grant, stated that the sheriff’s
sale was null and void. Likewise, the trial court’s decision, dated June 19,
2013, which granted American’s renewed motion for summary judgment,
found that “a previous judgment was granted in this case and that the
confirmation and sale proceedings were not in compliance with law.”
However, the decision issued by this Court on March 27, 2014, as a result of
Appellants’ second appeal, vacated both of those decisions and as such, any
finding that the sale had been rendered null and void or was not in
compliance with the law was vacated as well. Thus, Appellants’ reliance on
these prior determinations of the trial court is misplaced.
Scioto App. No. 14CA3659 8
{¶11} Further, the only potential procedural problem that has been
raised with regard to the trial court proceedings relates to a late filing of the
final judicial report. R.C. 2329.191(B) requires the filing of preliminary and
final judicial reports in foreclosure actions. In this Court’s most recent
decision on this matter, however, we determined that any potential
procedural issue related to the sale should have been apparent to the parties
at the time of the original appeal, but was not raised. Thus, we determined
that the argument was barred on appeal, and at any additional proceedings at
the trial court level. Farm Credit Services of Mid-America PCA, supra, at
¶ 14; citing State v. Fischer, 128 Ohio St. 3d 92, 2010-Ohio-6238, 942
N.E.2d 332, ¶ 35. As such, any argument by Appellants that the sale was
contrary to law is barred and we find no merit to this portion of Appellants’
argument.
{¶12} Appellants next contend that the trial court abused its discretion
in confirming the sale upon the motion of the third party purchasers, who
Appellants claim had no vested interest in the property prior to confirmation
of the sale. “[Third-party] purchasers at a foreclosure sale have no vested
interest in the property prior to confirmation of the sale by the trial court.”
Ohio Sav. Bank v. Ambrose, supra, at 55. “ ‘However, purchasers in
foreclosure actions do have the right to intervene and participate to protect
Scioto App. No. 14CA3659 9
their interests incident to the sale prior to confirmation.’ ” EMC Mtge. Corp.
v. Pratt, 10th Dist. Franklin No. 07AP-214, 2007-Ohio-4669, ¶ 11; quoting
Mid-American Natl. Bank v. Heiges, 6th Dist. Ottawa No. 94OT025, 1994
WL 645780 (Nov. 18, 1994); citing Reed v. Radigan, 42 Ohio St. 292, 294,
1884 WL 239 (1884).
{¶13} Thus, once the third party purchasers became the successful
bidders at the sheriff's sale, they had standing to move the court to intervene
and appear in order to protect their acquired interest in the property. Further,
as noted by American, the third party purchasers in this matter intervened in
the matter below and Appellants did not object. As such, Appellants have
waived any argument based upon the third party purchasers’ participation in
the proceedings below. Additionally, as noted by the third party purchasers
in their brief, R.C. 2329.31, entitled “Confirmation and order for deed,”
which is set forth above indicates that the trial court may sua sponte confirm
a sale, without a motion being filed by any of the parties, if it is satisfied the
sale was in conformity with the law. In light of this Court’s prior affirmance
of the original summary judgment grant and decree in foreclosure, as well as
our finding that any arguments based upon procedural flaws in the
proceedings were barred, we cannot conclude that the trial court abused its
discretion in confirming the sale. Based upon the foregoing, we also reject
Scioto App. No. 14CA3659 10
this portion of Appellants’ argument raised under their sole assignment of
error.
{¶14} Finally, Appellants contend that the trial court abused its
discretion in confirming the sale the same day that American had filed a
praecipe for and obtained a new order of sale. A review of the record
indicates that American filed a praecipe for order of sale at 10:26 a.m. on
September 8, 2014. The record further reflects that the trial court issued a
judgment entry confirming sale at 2:22 p.m. on September 8, 2014.
Although the rationale for the filing does not appear in the trial court record,
American explains on appeal that it filed a “supplemental” order of sale “as
a result of the delay between the filing of the Motion for Confirmation and
the filing of the Confirmation Order.” American filed a notice of withdrawal
of praecipe for order of sale the next day, on September 9, 2014. Thus, it
never actually obtained a new order of sale. Based upon these facts and in
light of the procedural history of this case, we cannot conclude that the trial
court erred or abused its discretion in confirming the sale. Further, it is
unlikely that the trial court was even aware of American’s filing at the time
its entry confirming the sale was filed and likewise, as noted by American
on appeal, had American known an order confirming the sale was being
Scioto App. No. 14CA3659 11
filed, it would not have filed a supplemental praecipe for order of sale. As
such, the final argument raised under this assignment is without merit.
{¶15} Having found no merit in the arguments raised, Appellants’
sole assignment of error is overruled. Accordingly, the decision of the trial
court is affirmed.
JUDGMENT AFFIRMED.
Scioto App. No. 14CA3659 12
JUDGMENT ENTRY
It is ordered that the JUDGMENT BE AFFIRMED and that the
Appellee recover of Appellants any costs herein.
The Court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate issue out of this Court directing
the Scioto County Common Pleas Court to carry this judgment into
execution.
Any stay previously granted by this Court is hereby terminated as of
the date of this entry.
A certified copy of this entry shall constitute the mandate pursuant to
Rule 27 of the Rules of Appellate Procedure.
Abele, J.: Concurs in Judgment and Opinion.
Hoover, P.J.: Concurs in Judgment Only.
For the Court,
BY: _____________________________
Matthew W. McFarland,
Administrative Judge
NOTICE TO COUNSEL
Pursuant to Local Rule No. 14, this document constitutes a final
judgment entry and the time period for further appeal commences from
the date of filing with the clerk.