BAC Home Loans Servicing, LP v. Altizer

[Cite as BAC Home Loans Servicing, LP v. Altizer, 2012-Ohio-5378.]
COURT OF APPEALS
KNOX COUNTY, OHIO
FIFTH APPELLATE DISTRICT
BAC HOME LOANS SERVICING, LP JUDGES:
Hon. William B. Hoffman, P.J.
Plaintiff-Appellee Hon. John W. Wise, J.
Hon. Julie A. Edwards, J.
-vs-
Case No. 12-CA-13
DAVID ALTIZER, ET AL.
Defendants-Appellants OPINION
CHARACTER OF PROCEEDING: Appeal from the Knox County Court of
Common Pleas, Case No. 10FR10-0651
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: November 19, 2012
APPEARANCES:
For Plaintiff-Appellee For Defendants-Appellants
KIMBERLEE S. ROHR JOHN SHERROD
Lerner, Sampson & Rothfuss Mills, Mills, Fiely & Lucas, LLC
120 East Fourth Street, Suite 800 503 South Front Street, Ste. 240
Cincinnati, Ohio 45202 Columbus, Ohio 43215
Knox County, Case No. 12-CA-13 2
Hoffman, P.J.
{¶1} Defendants-appellants David and Brenda Altizer appeal the June 19, 2012
Entry Granting Summary Judgment and Decree in Foreclosure entered by the Knox
County Court of Common Pleas. Plaintiff-appellee is BAC Home Loans Servicing, LP
fka Countrywide Home Loans Servicing, LP (“Countrywide”).
STATEMENT OF THE FACTS AND CASE
{¶2} On November 13, 2006, Appellants executed a promissory note in favor of
Countrywide in the amount of $237,500.00. Appellants secured the note with a
mortgage to Mortgage Electronic Registration Systems (“MERS”) as nominee for
Countrywide. Countrywide subsequently indorsed the note in blank and transferred it to
Appellee, who later merged with Bank of America. The mortgage was also assigned to
Appellee.
{¶3} Appellants defaulted under the terms of the note and mortgage, and
Appellee accelerated the debt. On October 19, 2010, Appellee filed a Complaint in
Foreclosure against Appellants. Copies of the note, mortgage, and assignment of
mortgage were attached as exhibits to the Complaint. Appellants filed a pro se Answer,
in which they admitted to contacting Bank of America for purposes of a loan
modification or federal loan program. Appellants did not assert any defenses or, in any
other way, contest Appellee’s standing or status as the real party in interest.
{¶4} On December 8, 2011, Appellee filed a motion to substitute Bank of
America, successor by merger to Appellee, as party plaintiff. Appellee included
documents detailing the merger of Appellee and Bank of America, which became
effective July 1, 2011. On March 20, 2012, Appellee filed a motion for summary
Knox County, Case No. 12-CA-13 3
judgment with the supporting affidavit of Betty J. Marion, Assistant Vice President for
Bank of America. Appellants filed a memorandum contra. Appellee filed a Notice of
Filing of Note which included a copy of the note bearing a blank indorsement from the
original lender. The trial court granted summary judgment in favor of Appellee on June
19, 2012.
{¶5} It is from this judgment entry Appellants appeal, assigning as error:
{¶6} “I. THE TRIAL COURT ERRED IN GRANTING APPELLEE’S MOTION
FOR SUMMARY JUDGMENT WHERE IT DID NOT FOLLOW ITS OWN LOCAL RULE
REGARDING EVIDENCE OF ASSIGNMENT OF THE PROMISSORY NOTE AT
ISSUE.”
STANDARD OF REVIEW
{¶7} Summary judgment proceedings present the appellate court with the
unique opportunity of reviewing the evidence in the same manner as the trial court.
Smiddy v. The Wedding Party, Inc. (1987), 30 Ohio St.3d 35, 36, 506 N.E.2d 212. As
such, this Court reviews an award of summary judgment de novo. Grafton v. Ohio
Edison Co. (1996), 77 Ohio St.3d 102, 105, 671 N.E.2d 241.
{¶8} Civ.R. 56 provides summary judgment may be granted only after the trial
court determines: 1) no genuine issues as to any material fact remain to be litigated; 2)
the moving party is entitled to judgment as a matter of law; and 3) it appears from the
evidence that reasonable minds can come to but one conclusion and viewing such
evidence most strongly in favor of the party against whom the motion for summary
judgment is made, that conclusion is adverse to that party. Temple v. Wean United, Inc.
(1977), 50 Ohio St.2d 317, 364 N.E.2d 267.
Knox County, Case No. 12-CA-13 4
{¶9} It is well established the party seeking summary judgment bears the
burden of demonstrating that no issues of material fact exist for trial. Celotex Corp. v.
Catrett (1987), 477 U.S. 317, 330, 106 S.Ct. 2548, 91 L.Ed.2d 265. The standard for
granting summary judgment is delineated in Dresher v. Burt (1996), 75 Ohio St.3d 280at 293, 662 N.E.2d 264: “ * * * a party seeking summary judgment, on the ground that
the nonmoving party cannot prove its case, bears the initial burden of informing the trial
court of the basis for the motion, and identifying those portions of the record that
demonstrate the absence of a genuine issue of material fact on the essential element(s)
of the nonmoving party's claims. The moving party cannot discharge its initial burden
under Civ.R. 56 simply by making a conclusory assertion the nonmoving party has no
evidence to prove its case. Rather, the moving party must be able to specifically point to
some evidence of the type listed in Civ.R. 56(C) which affirmatively demonstrates the
nonmoving party has no evidence to support the nonmoving party's claims. If the
moving party fails to satisfy its initial burden, the motion for summary judgment must be
denied. However, if the moving party has satisfied its initial burden, the nonmoving party
then has a reciprocal burden outlined in Civ.R. 56(E) to set forth specific facts showing
there is a genuine issue for trial and, if the nonmovant does not so respond, summary
judgment, if appropriate, shall be entered against the nonmoving party.” The record on
summary judgment must be viewed in the light most favorable to the opposing party.
Williams v. First United Church of Christ (1974), 37 Ohio St.2d 150, 309 N.E.2d 924.
Knox County, Case No. 12-CA-13 5
I
{¶10} In their sole assignment of error, Appellants contend the trial court erred in
granting summary judgment in favor of Appellee as Appellee failed to establish it was
the holder of the note at issue.
{¶11} The Local Rules of the Knox County Court of Common Pleas include
specific requirements for the filing of foreclosure actions. Knox Local R. 16.01 provides:
{¶12} “Rule 17 of the Ohio Rules of Civil Procedure shall be strictly enforced in
all mortgage foreclosure actions. The following information shall be contained in the
complaint:
{¶13} “(A) A copy of the note, along with an affirmative statement in the body of
the complaint that the plaintiff is the holder in due course of the note. If the note does
not reflect that the plaintiff is the holder on its face, a copy of an assignment of the note
shall be filed, demonstrating that the plaintiff is the owner and holder of the note.”
{¶14} Civ.R. 17(A) reads, in pertinent part:
{¶15} “Every action shall be prosecuted in the name of the real party in interest.
An executor, administrator, guardian, bailee, trustee of an express trust, a party with
whom or in whose name a contract has been made for the benefit of another, or a party
authorized by statute may sue in his name as such representative without joining with
him the party for whose benefit the action is brought. * * * No action shall be dismissed
on the ground that it is not prosecuted in the name of the real party in interest until a
reasonable time has been allowed after objection for ratification of commencement of
the action by, or joinder or substitution of, the real party in interest. Such ratification,
Knox County, Case No. 12-CA-13 6
joinder, or substitution shall have the same effect as if the action had been commenced
in the name of the real party in interest.”
{¶16} In Wachovia Bank, N.A. v. Cipriano, Fifth Dist. App. No. 09CA007, 2009-
Ohio-5470, ¶ 38, this Court explained: “Pursuant to Civ.R. 17(A), the real party of
interest shall ‘prosecute’ the claim. The rule does not state ‘file’ the claim.” We thus
rejected the defendant's argument in that case the trial court lacked jurisdiction because
Wachovia was not the holder or owner of the note and mortgage at the time of the filing
of the complaint. Id. at ¶ 40. A party must provide evidence of its right to enforce the
note and mortgage prior to the trial court’s entering a judgment. U.S. Bank Natl. Assn.
v. Bayless, Fifth Dist. App. No. 09 CAE 01 004, 2009-Ohio-6115. See, also, LaSalle
Bank Natl. Assn. v. Street, Fifth Dist. App.No. 08 CA 60, 2009-Ohio-1855, ¶ 28.
{¶17} “The purpose behind the real party in interest rule is ‘to enable the
defendant to avail himself of evidence and defenses that the defendant has against the
real party in interest, and to assure him finality of the judgment, and that he will be
protected against another suit brought by the real party at interest on the same matter’.”
Shealy v. Campbell, 20 Ohio St.3d 23, 24-25, 485 N.E.2d 701 (1985). (Citations
omitted).
{¶18} “The real-party-in-interest rule concerns only proper party joinder. Civ.R.
17(A) does not address standing; rather, the point of the rule is that “suits by
representative plaintiffs on behalf of the real parties in interest are the exception rather
than the rule and should only be allowed when the real parties in interest are identifiable
and the res judicata scope of the judgment can be effectively determined.” Federal
Home Loan Mortgage Corp. v. Schwartzwald, Slip Opinion No. 2012-Ohio-5017,
Knox County, Case No. 12-CA-13 7
quoting Lincoln Property Co. v. Roche, 546 U.S. 81, 90, 126 S.Ct. 606, 163 L.Ed.2d 415(2005), citing Consumer Fedn. of Am. v. Upjohn Co., 346 A.2d 725, 729 (D.C.1975)
(construing analogous District of Columbia rule).
{¶19} Standing, on the other hand, is a “jurisdictional requirement”. State ex rel.
Dallman v. Franklin Cty. Court of Common Pleas, 35 Ohio St.2d 176, 179, 298 N.E.2d
515 (1973). Because standing to sue is required to invoke the jurisdiction of the
common pleas court, “standing is to be determined as of the commencement of suit.”
Schwartzwald, supra. (Citations omitted).
{¶20} The Rules of Civil Procedure do not extend the jurisdiction of the courts of
this state, and a common pleas court cannot substitute a real party in interest for
another party if no party with standing has invoked its jurisdiction in the first instance.
Civ. R. 82. “Accordingly, a litigant cannot pursuant to Civ.R. 17(A) cure the lack of
standing after commencement of the action by obtaining an interest in the subject of the
litigation and substituting itself as the real party in interest.” Schwartzwald, supra.1
{¶21} We find the Complaint filed by Appellee in the instant action alleges
sufficient general facts, coupled with the attached exhibits, to establish Appellee had
standing, at the commencement of the action, to invoke the jurisdiction of the Knox
County Court of Common Pleas. Appellee’s merger with Bank of America did not impact
its standing to initiate the foreclosure or in any way affect its status as the real party in
interest.
{¶22} We find Appellee presented evidence to the trial court which established it
was the holder of the note and mortgage. Accordingly, we find Appellee complied with
1
We find Schwartzwald effectively reverses this Court’s previous holdings to the
contrary in Cipriano, Bayless and Street.
Knox County, Case No. 12-CA-13 8
Civ. R. 17.2 Further, Appellee supported its motion for summary judgment with affidavits
and documents which establish it is the real party in interest. Appellants failed to
present any evidence to the contrary or which showed an issue of material fact was in
dispute.
{¶23} Based upon the foregoing, we find the trial court did not err in granting
summary judgment in favor of Appellee.
{¶24} Appellants’ sole assignment of error is overruled.
{¶25} The judgment of the Knox County Court of Common Pleas is affirmed.
By: Hoffman, P.J.
Wise, J. and
Edwards, J. concur
s/ William B. Hoffman _________________
HON. WILLIAM B. HOFFMAN
s/ John W. Wise _____________________
HON. JOHN W. WISE
s/ Julie A. Edwards___________________
HON. JULIE A. EDWARDS
2
To the extent the trial court failed to adhere to its Loc.R. 16.01, we find no abuse of
discretion.
Knox County, Case No. 12-CA-13 9
IN THE COURT OF APPEALS FOR KNOX COUNTY, OHIO
FIFTH APPELLATE DISTRICT
BAC HOME LOANS SERVICING, LP :
:
Plaintiff-Appellee :
:
-vs- : JUDGMENT ENTRY
:
DAVID ALTIZER, ET AL. :
:
Defendants-Appellants : Case No. 12-CA-13
For the reasons stated in our accompanying Opinion, the judgment of the Knox
County Court of Common Pleas is affirmed. Costs to Appellants.
s/ William B. Hoffman _________________
HON. WILLIAM B. HOFFMAN
s/ John W. Wise _____________________
HON. JOHN W. WISE
s/ Julie A. Edwards___________________
HON. JULIE A. EDWARDS