Midland Funding, L.L.C. v. Snedeker

[Cite as Midland Funding, L.L.C. v. Snedeker, 2014-Ohio-887.]
COURT OF APPEALS
LICKING COUNTY, OHIO
FIFTH APPELLATE DISTRICT
MIDLAND FUNDING, LLC DBA : JUDGES:
MIDLAND FUNDING DE LLC :
:
: Hon. W. Scott Gwin, P.J.
Plaintiff-Appellee : Hon. William B. Hoffman, J.
: Hon. Patricia A. Delaney, J.
-vs- :
: Case No. 13-CA-56
:
ROBERT SNEDEKER AKA ROBERT :
W. SNEDEKER :
:
:
Defendant-Appellant : OPINION
CHARACTER OF PROCEEDING: Appeal from the Licking County
Municipal Court, Case No. 12 CVF
03066
JUDGMENT: REVERSED AND REMANDED
DATE OF JUDGMENT ENTRY: February 25, 2014
APPEARANCES:
For Plaintiff-Appellee: For Defendant-Appellant:
AUDRA T. FUNK DAVID C. MORRISON
Javitch, Block & Rathbone, LLC Morrison & Bindley
140 E. Town St., Suite 1250 987 Professional Parkway
Columbus, OH 43215 Heath, OH 43056-1698
Licking County, Case No. 13-CA-56 2
Delaney, J.
{¶1} Defendant-Appellant Robert Snedeker aka Robert W. Snedeker appeals
the May 30, 2013 judgment entry of the Licking County Municipal Court.
FACTS AND PROCEDURAL HISTORY
{¶2} On January 31, 2013, Plaintiff-Appellee Midland Funding, LLC DBA
Midland Funding DE LLC filed an Amended Complaint against Defendant-Appellant
Robert Snedeker aka Robert W. Snedeker in the Licking County Municipal Court. In the
complaint, Midland alleged breach of contract, claim on account, money lent/money
paid, and unjust enrichment. The complaint stated that in 1999, Snedeker entered into
a contract for the extension of credit with Target National Bank. Snedeker or someone
authorized by him made purchases on the Target credit card account XXXX-XXXX-
XXXX-0675. Snedeker failed to make payments on the Target credit account. On
November 22, 2011, Midland acquired the right, title, and interest in Snedeker’s Target
credit account from the assignor, Target National Bank. Midland notified Snedeker of
the assignment of the credit account and demanded that Snedeker pay the balance due
on the account. Snedeker did not remedy the credit account default. The complaint
alleged Snedeker owed $6,500.07 on the credit account.
{¶3} Snedeker filed a Motion to Dismiss on February 19, 2013. The trial court
denied the motion.
{¶4} On April 8, 2013, Midland filed its Motion for Summary Judgment. In
support of its motion, Midland filed Snedeker’s responses to Midland’s interrogatories
and request for production of documents, and requests for admission. Midland also
filed the affidavit of Tanya Johnson, legal specialist who has access to account records
Licking County, Case No. 13-CA-56 3
for Midland Credit Management, Inc., servicer of accounts on behalf of Midland. In her
affidavit, Johnson stated that Midland is the current owner of, and/or successor to, the
obligation sued upon by Midland. She averred that Target National Bank assigned to
Midland all the rights, title, and interest to Snedeker’s credit card account XXXX-XXXX-
XXXX-0675. She states that attached to the affidavit are records regarding the account
and/or payment(s) received: bill of sale and assignment and/or billing statements. The
bill of sale, dated November 22, 2011, is a one page document reflecting the sale,
assignment, and transfer to Midland of “Accounts listed in the electronic file identified in
Appendix 1 hereto (the “Accounts”) as provided in the Asset Sale Agreement dated
June 10, 2011.” Appendix 1 is not attached to the bill of sale. Next attached to the
affidavit is a document with Snedeker’s credit account information. The bottom of the
document contains the following statement: “Data printed by Midland Credit
Management, Inc. from electronic records provided by Target National Bank and Target
Receivables LLC pursuant to the bill of sale/assignment of accounts transferred on or
about 11/22/2011 in connection with the sale of accounts from Target National Bank
and Target Receivables LLC to Midland Funding LLC.” Finally, the affidavit provides
copies of credit card statements showing purchases and payments on account number
XXXX-XXXX-XXXX-0675 starting on May 1, 2009 with a balance of $6,498.33 and the
credit card agreement.
{¶5} Snedeker filed his response to the motion for summary judgment on April
23, 2013.
Licking County, Case No. 13-CA-56 4
{¶6} The trial court granted Midland’s Motion for Summary Judgment on May
30, 2013. The trial court awarded Midland judgment in the amount of $6,500.07 with
statutory interest at a rate of 3.00% per annum from the date of the judgment.
{¶7} It is from this decision Snedeker now appeals.
ASSIGNMENTS OF ERROR
{¶8} Snedeker raises two Assignments of Error:
{¶9} “I. THE SUMMARY JUDGMENT IS CONTRARY TO LAW, BECAUSE
APPELLEE, MIDLAND FUNDING, LLC, FAILED TO DEMONSTRATE AN ABSENCE
OF GENUINE ISSUE OF MATERIAL FACT CONCERNING THE QUESTION
WHETHER IT WAS THE REAL PARTY IN INTEREST.
{¶10} “II. THE SUMMARY JUDGMENT IS CONTRARY TO LAW, BECAUSE
MIDLAND FAILED TO DEMONSTRATE AN ABSENCE OF ANY GENUINE ISSUE OF
MATERIAL FACT CONCERNING THE AMOUNT DUE.”
ANALYSIS
Standard of Review
{¶11} Snedeker’s two Assignments of Error concern the trial court’s application
of the summary judgment standard. We refer to Civ.R. 56(C) in reviewing a motion for
summary judgment which provides, in pertinent part:
Summary judgment shall be rendered forthwith if the pleading,
depositions, answers to interrogatories, written admissions, affidavits,
transcripts of evidence in the pending case and written stipulations of fact,
if any, timely filed in the action, show that there is no genuine issue as to
any material fact and that the moving party is entitled to judgment as a
Licking County, Case No. 13-CA-56 5
matter of law. * * * A summary judgment shall not be rendered unless it
appears from such evidence or stipulation and only from the evidence or
stipulation, that reasonable minds can come to but one conclusion and
that conclusion is adverse to the party against whom the motion for
summary judgment is made, such party being entitled to have the
evidence or stipulation construed most strongly in the party's favor.
{¶12} The moving party bears the initial responsibility of informing the trial court
of the basis for the motion, and identifying those portions of the record before the trial
court, which demonstrate the absence of a genuine issue of fact on a material element
of the nonmoving party's claim. Dresher v. Burt, 75 Ohio St. 3d 280, 292, 662 N.E.2d
264 (1996). The nonmoving party then has a reciprocal burden of specificity and cannot
rest on the allegations or denials in the pleadings, but must set forth “specific facts” by
the means listed in Civ.R. 56(C) showing that a “triable issue of fact” exists. Mitseff v.
Wheeler, 38 Ohio St. 3d 112, 115, 526 N.E.2d 798, 801 (1988).
{¶13} Pursuant to the above rule, a trial court may not enter summary judgment
if it appears a material fact is genuinely disputed. Vahila v. Hall, 77 Ohio St. 3d 421,
429, 674 N.E.2d 1164 (1997), citing Dresher v. Burt, 75 Ohio St. 3d 280, 662 N.E.2d 264
(1996).
I. Real Party in Interest
{¶14} Snedeker argues in his first Assignment of Error the trial court erred in
granting summary judgment in favor of Midland because there was a genuine issue of
material fact whether Midland was the real party in interest. We agree.
Licking County, Case No. 13-CA-56 6
{¶15} Midland brought its complaint on account based on an alleged assignment
of the credit account from Target National Bank to Midland. In an action on an account,
when an assignee is attempting to collect on an account in filing a complaint, the
assignee must “allege and prove the assignment.” Zwick & Zwick v. Suburban Const.
Co., 103 Ohio App. 83, 84, 134 N.E.2d 733 (8th Dist.1956). In other words, in order to
prevail, the assignee must prove that they are the real party in interest for purposes of
bringing the action. Worldwide Asset Purchasing, L.L.C. v. Sandoval, 5th Dist. Stark
No. 2007–CA–00159, 2008–Ohio–6343, ¶ 26. An assignee cannot prevail on the
claims assigned by another holder without proving the existence of a valid assignment
agreement. Sandoval, ¶ 26 citing Natl. Check Bur., Inc. v. Cody, 8th Dist. Cuyahoga
No. 84208, 2005–Ohio–283, citing Zwick & Zwick, supra.
{¶16} Midland, as the party seeking summary judgment on its claims, bears the
responsibility of identifying those portions of the record before the trial court that
demonstrate the absence of a genuine issue of fact on a material element of the
nonmoving party's claim. Dresher v. Burt, 75 Ohio St. 3d 280, 292, 662 N.E.2d 264
(1996). To support its claim that there is no genuine issue of material fact that it was
assigned Snedeker’s credit card account, Midland provided the affidavit of Tanya
Johnson, legal specialist who has access to account records for Midland Credit
Management, Inc., servicer of accounts on behalf of Midland. In her affidavit, Johnson
stated that Midland is the current owner of, and/or successor to, the obligation sued
upon by Midland. She averred that Target National Bank assigned to Midland all the
rights, title, and interest to Snedeker’s credit card account XXXX-XXXX-XXXX-0675.
Licking County, Case No. 13-CA-56 7
She states that attached to the affidavit are records regarding the account and/or
payment(s) received: bill of sale and assignment and/or billing statements.
{¶17} The bill of sale, dated November 22, 2011, is a one page document
reflecting the sale, assignment, and transfer to Midland of “Accounts listed in the
electronic file identified in Appendix 1 hereto (the “Accounts”) as provided in the Asset
Sale Agreement dated June 10, 2011.” Appendix 1 is not attached to the bill of sale nor
is it provided as Civ.R. 56 evidence.
{¶18} Next attached to the affidavit is a document with Snedeker’s credit
account information. The bottom of the document contains the following statement:
“Data printed by Midland Credit Management, Inc. from electronic records provided by
Target National Bank and Target Receivables LLC pursuant to the bill of
sale/assignment of accounts transferred on or about 11/22/2011 in connection with the
sale of accounts from Target National Bank and Target Receivables LLC to Midland
Funding LLC.” The document is silent as to whether the data was pulled from Appendix
1 referred to in the bill of sale. The affidavit of Tanya Johnson does not refer to this
document.
{¶19} The affidavit provides copies of credit card statements showing purchases
and payments on account number XXXX-XXXX-XXXX-0675 starting in May 1, 2009
with a balance of $6,498.33. Finally, the affidavit provides a copy of the credit card
agreement issued by Target National Bank.
{¶20} In Midland Funding, L.L.C. v. Biehl, 5th Dist. Stark No. 2013 CA 00035,
2013-Ohio-4150, this court analyzed whether the Civ.R. 56 evidence presented by the
plaintiff Midland Funding in support of its motion for summary judgment established
Licking County, Case No. 13-CA-56 8
there was no genuine issue of material fact that it was assigned a credit card account
and was entitled to judgment as a matter of law on its claim on account. We stated:
In the case sub judice, attached to Appellee Midland's motion for
summary judgment was an affidavit from Melissa Haag, who works in the
capacity of a records specialist for an agency in St. Cloud, Minnesota
servicing accounts for appellee. In her affidavit, Haag stated that the
HSBC account at issue had been assigned to appellee. See Exhibit A.
Appellee also attached account statements to the summary judgment
motion showing that purchases and payments had been made on said
HSBC account. See Exhibit B. In addition, appellee attached a single-
page bill of sale showing a transfer of various accounts from HSBC to
Appellee Midland. See Exhibit C. The bill of sale makes reference to
“purchased receivables listed on the Sale File” which purports to be
attached as another exhibit; however, such an exhibit is not attached, nor
is it found elsewhere in the summary judgment documents.
Appellant, in support of his argument, directs us to Hudson &
Keyse, LLC v. Yarnevic–Rudolph, 7th Dist. Jefferson No. 09 JE 4, 2010–
Ohio–5938. In that case, the Seventh District Court of Appeals concluded
that even though the purported assignee (Hudson & Keyse) had attached
an affidavit to its summary judgment motion averring that Hudson & Keyse
was the assignee of assignor's (Beneficial Company's) interest in a
personal loan agreement, “ * * * due to the fact that the agreement
referred to in the assignment and bill of sale is not attached, it is not clear
Licking County, Case No. 13-CA-56 9
that [borrower's] account is among the assigned accounts.” Id. at ¶ 24.
The Court, having earlier reiterated what it labeled the “how and when”
requirement set forth in Washington Mut. Bank, F.A. v. Green, 156 Ohio
App.3d 461, 806 N.E.2d 604, 2004–Ohio–1555, thus concluded as
follows: “To the extent that there is no evidence that [borrower's] personal
loan agreement was among the accounts assigned to [Hudson & Keyse]
by Beneficial, the trial court erred as a matter of law when it entered
summary judgment.” Hudson & Keyse, LLC v. Yarnevic–Rudolph at ¶ 24.
We find a similar result is warranted in the case sub judice. In other
words, although appellee herein attached (1) the affidavit from Ms. Haag
generally averring that the HSBC Bank Nevada N.A. account no. xxxx–
xxxx–xxxx–4894 had been assigned to appellee, (2) copies of several
credit card statements showing purchases and payments on account no.
xxxx–xxxx–xxxx–4894, and (3) the one-page bill of sale between HSBC
Card Services and Appellee Midland from May 28, 2009, we hold there
was insufficient information to enable the trial court to determine as a
matter of law that account no. xxxx–xxxx–xxxx–4894 was actually
included in the group of accounts affected by the bill of sale and thus duly
assigned to appellee for purposes of summary judgment.
Midland Funding, L.L.C. v. Biehl, 5th Dist. No. 2013 CA 00035, 2013-Ohio-4150, ¶ 22-
24. See, Midland Funding LLC v. Farrell, 1st Dist. Hamilton No. C-120674, 2013-Ohio-
5509 (Cunningham, J., dissenting).
Licking County, Case No. 13-CA-56 10
{¶21} The Civ.R. 56 evidence presented by Midland in support of the
assignment of Snedeker’s credit card account is substantially similar to that presented
in Biehl. The difference in the present case is that Midland also submitted a document
with Snedeker’s account information that Midland alleges was culled from the data
referred to in the bill of sale. The statement on the document reads: “Data printed by
Midland Credit Management, Inc. from electronic records provided by Target National
Bank and Target Receivables LLC pursuant to the bill of sale/assignment of accounts
transferred on or about 11/22/2011 in connection with the sale of accounts from Target
National Bank and Target Receivables LLC to Midland Funding LLC.” While the
affidavit of Tanya Johnson refers to the attached bill of sale, assignment, and billing
statement, the affidavit makes no mention of this document. This document is not
Appendix 1 referred to in the bill of sale.
{¶22} At the appellate level, we conduct a de novo review of a motion for
summary judgment from a posture most favorable to the non-moving party. In this
case, following the precedent of Biehl, we find there is insufficient information to enable
the trial court to determine as a matter of law that account number XXXX-XXXX-XXXX-
0675 was included in the group of accounts affected by the bill of sale and referred to by
Appendix 1. A genuine issue of material fact remains whether Snedeker’s account was
among those properly assigned to Midland.
{¶23} Snedeker’s first Assignment of Error is sustained.
Licking County, Case No. 13-CA-56 11
II. Balance Due
{¶24} Snedeker argues in his second Assignment of Error the trial court erred in
granting summary judgment because there are genuine issues of material fact as to the
amount due.
{¶25} In order to In order to establish a prima facie case for money owed on an
account, we held in Worldwide Asset Purchasing, L.L.C. v. Sandoval the plaintiff must
show:
“[a]n account must show the name of the party charged and contain: (1) a
beginning balance (zero, or a sum that can qualify as an account stated,
or some other provable sum); (2) listed items, or an item, dated and
identifiable by number or otherwise, representing charges, or debits, and
credits; and (3) summarization by means of a running or developing
balance, or an arrangement of beginning balance and items which permits
the calculation of the amount claimed to be due.” Gabriele v. Reagan
(1988), 57 Ohio App. 3d 84, 87, 566 N.E.2d 684, quoting Brown v.
Columbus Stamping & Mfg. Co. (1967), 9 Ohio App. 2d 123, 223 N.E.2d
373, paragraph three of the syllabus. “[A]n action upon an account may
be proved by the introduction of business records showing the existence
of the account.” Wolf Automotive v. Rally Auto Parts, Inc. (1994), 95 Ohio
App.3d 130, 137, 641 N.E.2d 1195. See, generally, Raymond Builders
Supply, Inc. v. Slapnicker, 11th Dist. No.2003-A-0040, 2004-Ohio-1437, at
¶ 8.
Sandoval, 5th Dist. Stark No. 2007-CA-00159, 2008-Ohio-6343, ¶ 27.
Licking County, Case No. 13-CA-56 12
{¶26} We determined in the first Assignment of Error there was a genuine issue
of material fact as to whether Midland is the real party in interest, an essential element
of Midland’s claim on account. Based on this conclusion, it is premature to determine
whether Midland has demonstrated the remaining elements to its claim on account.
CONCLUSION
{¶27} For the foregoing reasons, we find the judgment of the Licking County
Municipal Court is reversed and remanded for further proceedings consistent with this
opinion and law.
By: Delaney, J.,
Gwin, P.J. and
Hoffman, J., concur.