Wilmington Savs. Fund Soc. v. Lautzenheiser

[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
COURT OF APPEALS
STARK COUNTY, OHIO
FIFTH APPELLATE DISTRICT
WILMINGTON SAVINGS FUND :
SOCIETY, FSB, AS TRUSTEE OF :
STANWICH MORTGAGE LOAN : JUDGES:
TRUST A :
:
: Hon. William B. Hoffman, P.J.
Plaintiff-Appellee : Hon. John W. Wise, J.
: Hon. Patricia A. Delaney, J.
-vs- :
: Case No. 2020CA00059
:
DONALD J. LAUTZENHEISER AKA :
DONALD JAY LAUTZENHEISER :
:
:
Defendant-Appellant : OPINION
CHARACTER OF PROCEEDING: Appeal from the Stark County Court of
Common Pleas, Case No. 2015 CV 789
JUDGMENT: AFFIRMED
DATE OF JUDGMENT ENTRY: March 29, 2021
APPEARANCES:
For Plaintiff-Appellee: For Defendant-Appellant:
PHILLIP BARRAGATE DAVID A. VAN GAASBEEK
4805 Montgomery Rd., Suite 320 1303 West Maple St., Suite 104
Cincinnati, OH 45212 North Canton, OH 44720
JOHNA M. BELLA
405 Madison Ave., Suite 2200
Toledo, OH 43604
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
Delaney, J.
{¶1} Defendant-Appellant Donald J. Lautzenheiser aka Donald Jay
Lautzenheiser appeals the February 27, 2020 Decree of Foreclosure granted by the Stark
County Court of Common Pleas. The Plaintiffs-Appellees are Elizon Master Participation
Trust I, U.S. Bank Trust National Association, as Owner Trustee and Citizens Bank, N.A.
fka RBS Citizens, N.A. successor by merger to Charter One Bank, N.A.
FACTS AND PROCEDURAL HISTORY
{¶2} On July 7, 2004, Defendant-Appellant Donald J. Lautzenheiser aka Donald
Jay Lautzenheiser executed a Promissory Note in the amount of $83,000 with Charter
One Bank, N.A. The Promissory Note was secured with a primary mortgage on residential
property located in Massillon, Ohio. Lautzenheiser also executed a Credit Line Agreement
in the original sum of $34,700, which was secured by a second mortgage on the
residential property located in Massillon, Ohio.
{¶3} Effective February 1, 2014, Lautzenheiser entered into a Home Affordable
Modification Agreement with Plaintiff-Appellee Citizens Bank, N.A. fka RBS Citizens, N.A.
successor by merger to Charter One Bank, N.A. The new principal balance of the Note
was $74,041.96. Pursuant to the terms of the Note, interest at 5.000% began to accrue
on January 1, 2014 and the first monthly payment was due on February 1, 2014. The
monthly principal and interest payment amount on the new principal balance was $357.03
and the estimated monthly escrow payment amount was $232.79, for a total monthly
payment of $589.82. The modified agreement was secured with a primary mortgage on
the residential property located in Massillon, Ohio.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶4} On May 6, 2014, Citizens Bank sent Lautzenheiser a Notice of Default on
the mortgage loan.
{¶5} On March 2, 2015, Lautzenheiser attempted to make a payment on the
mortgage in the amount of $594.36. Citizens Bank returned the check because the
amount was insufficient to reinstate the loan.
{¶6} On April 16, 2015, Citizens Bank filed a Complaint for Money Judgment and
Foreclosure against Lautzenheiser in the Stark County Court of Common Pleas. In the
first and second claims, the Complaint alleged there was $73,895.79 plus interest at a
rate of 5.0% per annum due and owing from April 1, 2014. The Complaint raised a third
claim that there was due and owing on the Credit Line Agreement and secondary
mortgage in the amount of $25,026.35 plus interest of $990.84 pursuant to the terms of
the agreement, late fees, costs, advances, and expenses incurred.
{¶7} On May 26, 2015, the trial court referred the matter to the foreclosure
mediation program and stayed proceedings pending the outcome of the mediation.
Lautzenheiser filed his answer to the complaint on June 19, 2015.
{¶8} On November 24, 2015, the report of the mediator was filed indicating the
matter had not been settled as additional information was required from Lautzenheiser.
Lautzenheiser was given until December 7, 2015 to produce the documents, and
mediation was rescheduled for January 21, 2016.
{¶9} On January 21, 2016, the mediator filed a report indicating the matter was
not settled as additional documentation was required. Mediation was again rescheduled
for March 17, 2016.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶10} On March 18, 2016, the mediator filed another report indicating the matter
had not been settled as Citizens Bank required statements from Lautzenheiser regarding
his pension benefits. Both parties desired to remain in mediation, but the matter was
returned to the trial court for that determination. On April 11, 2016, Lautzenheiser filed a
motion for further mediation. On April 19, 2016, the trial court granted the motion, allowing
for one additional mediation.
{¶11} While the case was in mediation, Citizens Bank, N.A. assigned the primary
mortgage to Wilmington Savings Fund Society, FSB, as trustee of Stanwich Mortgage
Loan Trust A. On October 19, 2016, mediation was canceled because mortgage was
being assigned to a new servicer.
{¶12} On June 5, 2017, Wilmington assigned the primary mortgage to Elizon
Master Participation Trust I, U.S. Bank Trust National Association, as Owner Trustee. On
October 30, 2017, Wilmington filed a Motion to Substitute Party Plaintiff with Elizon Master
Participation Trust I, U.S. Bank Trust National Association, as Owner Trustee. The trial
court granted the motion to substitute the party plaintiff on November 1, 2017. The docket,
however, incorrectly refers to Wilmington Savings Fund Society, FSB, as trustee of
Stanwich Mortgage Loan Trust A as the party plaintiff. The Plaintiff-Appellee in this matter
is Elizon Master Participation Trust I, U.S. Bank Trust National Association, as Owner
Trustee (“Elizon Master”).
{¶13} The case then sat for more than a year until January 31, 2018, when
Lautzenheiser filed a motion for further mediation. The motion was granted on February
28, 2018.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶14} Mediation took place as scheduled on May 24, 2018. On May 25, 2018, the
mediator filed a report indicating mediation had been unsuccessful and referred the
matter back to the trial court.
{¶15} On July 13, 2018, Elizon Master filed a motion for summary judgment
arguing it was entitled to judgment as a matter of law on first and second claims of the
Complaint regarding the primary mortgage.
{¶16} Fourteen days later, on July 27, 2018, Lautzenheiser filed a “Motion for Stay
of Determining the Issues Raised in the Motion for Summary Judgment.” In his motion,
Lautzenheiser argued Elizon Master had filed its motion for summary judgment before he
could file his amended answer and counterclaim instanter, and that his amended answer
and counterclaim raised significant points which should be subject to discovery and
further scrutiny. Also, on July 27, 2018, Lautzenheiser filed a “Motion for Leave to File an
Amended Answer and Counterclaim Instanter.”
{¶17} On July 30, 2018, 17 days after Lautzenheiser’s 28-day response period
under Civ.R. 56(C) began, the trial court granted Elizon Master’s motion for summary
judgment and issued the Decree in Foreclosure. The trial court did not address either of
Lautzenheiser’s motions.
{¶18} On August 28, 2018, Lautzenheiser filed a Notice of Appeal of the July 30,
2018 Decree in Foreclosure.
{¶19} While the case was pending on appeal, the property was sold at sheriff’s
sale on October 1, 2018. On October 17, 2018, the trial court granted Lautzenheiser’s
motion to stay delivery of the deed to the purchaser.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶20} On June 14, 2019, this Court issued its opinion and reversed the judgment
of the trial court due to its failure to abide by Civ.R. 56(C) and afford Lautzenheiser 28
days to respond to the motion for summary judgment before granting judgment in favor
of Elizon Master. Wilmington Savings Fund v. Lautzenheiser, 2019-Ohio-2389, 138
N.E.3d 673, ¶ 29 (5th Dist.). The matter was remanded to the trial court for further
proceedings.
{¶21} Upon remand, the trial court issued a briefing schedule on Elizon Master’s
motion for summary judgment. A non-oral hearing was scheduled for August 16, 2019.
{¶22} Lautzenheiser filed his response to Elizon Master’s motion for summary
judgment on July 29, 2019. In his response, he argued his payment records established
there was a genuine issue of material fact as to whether the primary mortgage was in
default. Lautzenheiser attached his affidavit in which he listed the payments he made
from 2006 to 2015 totaling $82,142.46. He attached as exhibits photocopies of coupon
book stubs, bank check receipts, account statements, money order receipts, and annual
escrow account disclosure statements.
{¶23} On August 23, 2019, Elizon Master filed its reply to its motion for summary
judgment. Elizon Master argued there was no genuine issue of material fact that
Lautzenheiser entered into a loan modification agreement effective February 1, 2014. The
agreed principal amount of the loan modification was $74,041.96. Elizon Master argued
the evidence demonstrated there was an unpaid principal balance of $74,000 in 2014 and
Lautzenheiser stopped making payments shortly after the modification went into effect;
therefore, he could not have paid the balance of the loan modification.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶24} On September 6, 2019, Plaintiff-Appellee Citizens Bank, N.A. fka RBS
Citizens, N.A. successor by merger to Charter One Bank, N.A. filed its motion for
summary judgment seeking judgment as a matter of law on the third claim of the
Complaint regarding the credit line agreement secured by a secondary mortgage. It
alleged the Civ.R. 56 evidence established the outstanding balance on the credit line
agreement was $26,017.19.
{¶25} Lautzenheiser filed a response and supporting affidavit on September 20,
2019. Citizens Bank filed a reply on October 4, 2019.
{¶26} On October 16, 2019, the trial court issued its judgment entry granting
summary judgment in favor of Citizens Bank on the third claim of the Complaint. On
October 30, 2019, the trial court filed the Decree of Foreclosure on the third claim of the
Complaint in favor of Citizens Bank. The October 16, 2019 and October 30, 2019
judgment entries did not include Civ.R. 54(B) language.
{¶27} On November 13, 2019, Lautzenheiser filed a notice of appeal of the
October 30, 2019 judgment entry. Citizens Bank filed a motion to dismiss appeal for lack
of a final appealable order. On January 17, 2019, we granted Citizen Bank’s motion to
dismiss appeal because the motion for summary judgment filed by Elizon Master
remained pending before the trial court and the trial court did not include Civ.R. 54(B)
language on the October 16, 2019 or October 30, 2019 judgment entries. We dismissed
the appeal for lack of jurisdiction.
{¶28} On February 27, 2020, the trial court granted the motion for summary
judgment filed by Elizon Master on the first and second claims of the Complaint.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶29} Lautzenheiser filed a notice of appeal of the February 27, 2020 judgment
entry on March 17, 2020.
ASSIGNMENT OF ERROR
{¶30} Lautzenheiser raises one Assignment of Error:
{¶31} “THE TRIAL COURT COMMITTED REVERSIBLE ERROR IN GRANTING
APPELLEES’ MOTIONS FOR SUMMARY JUDGMENT BECAUSE APPELLANT
PRESENTED SUFFICIENT EVIDENCE TO CREATE GENUINE ISSUES OF MATERIAL
FACT THAT HE MADE PAYMENTS TO SATISFY THE REQUIREMENTS OF THE
MORTGAGE LOAN AGREEMENTS AND TO RULE OTHERWISE WOULD MEAN THAT
THE TRIAL COURT MADE CREDIBILITY DETERMINATIONS AS TO THE TRUTH AND
VERACITY OF THE EVIDENTIARY MATERIAL WHICH IS NOT TO BE CONSIDERED
IN THE SUMMARY JUDGMENT PROCESS.”
ANALYSIS
Standard of Review
{¶32} This matter comes to us upon the trial court’s grant of summary judgment
in favor of Elizon Master and Citizens Bank on their complaint for a money judgment and
foreclosure. Lautzenheiser argues the trial court erred in its judgment. 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 matter of law. * *
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
* 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.
{¶33} 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).
{¶34} 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).
{¶35} 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., 30 Ohio St.3d 35, 36, 506 N.E.2d 212 (1987). As such, this
Court reviews an award of summary judgment de novo. Grafton v. Ohio Edison Co., 77
Ohio St.3d 102, 105, 671 N.E.2d 241 (1996).
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
Credibility
{¶36} All parties submitted affidavits in support of their respective motions for
summary judgment and responses to the motions for summary judgment. Civ.R. 56(E)
outlines the requirements for affidavits submitted to support a Civ.R. 56 motion for
summary judgment. The rule states:
Form of Affidavits; Further Testimony; Defense Required. Supporting and
opposing affidavits shall be made on personal knowledge, shall set forth
such facts as would be admissible in evidence, and shall show affirmatively
that the affiant is competent to testify to the matters stated in the affidavit.
Sworn or certified copies of all papers or parts of papers referred to in an
affidavit shall be attached to or served with the affidavit. The court may
permit affidavits to be supplemented or opposed by depositions or by further
affidavits. When a motion for summary judgment is made and supported as
provided in this rule, an adverse party may not rest upon the mere
allegations or denials of the party's pleadings, but the party's response, by
affidavit or as otherwise provided in this rule, must set forth specific facts
showing that there is a genuine issue for trial. If the party does not so
respond, summary judgment, if appropriate, shall be entered against the
party.
In his appeal, Lautzenheiser contends the trial court made impermissible credibility
determinations as to the truth and veracity of the affidavit testimony presented under
Civ.R. 56(E).
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶37} Lautzenheiser is correct when he states that the court must not weigh the
evidence or determine the merits of the case or the credibility of the witnesses when
considering a Civ.R. 56 motion. Kreais v. Chemi-Trol Chem. Co., 52 Ohio App.3d 74, 78,
557 N.E.2d 155 (6th Dist.1989); Turner v. Turner, 67 Ohio St.3d 337, 341-342, 617 N.E.2d
1123 (1993). A trial court does not have the liberty to choose among reasonable
inferences in the context of summary judgment, and all competing inferences and
questions of credibility must be resolved in the nonmoving party's favor. Tomlin v. City of
Akron, 9th Dist. Summit No. CV 29293, 2021-Ohio-819, citing Perez v. Scripps–Howard
Broadcasting Co., 35 Ohio St.3d 215, 218 (1988).
{¶38} The elements of a foreclosure require Elizon Master and Citizens Bank to
establish that Lautzenheiser owed money, the mortgages were valid liens on the property,
the conditions of the notes and mortgages had been breached, and the equities supported
foreclosure as the appropriate remedy. See First Knox Natl. Bank v. Peterson, 5th Dist.
Knox No. 08CA28, 2009-Ohio-5096, ¶ 19. In support of its motion for summary judgment,
Elizon Master submitted the affidavit and supplemental affidavit of Konnor Wyly, an asset
manager and account officer with SN Servicing Corporation, the authorized servicing
agent for Elizon Master. Citizens Bank submitted the affidavit of Blair Dugan, a recovery
specialist with Citizens Bank. Both affidavits asserted they were the holders of the
respective first and a second mortgages, the mortgages were valid liens on the property,
and Lautzenheiser breached the terms of the notes and mortgages. In his supplemental
affidavit, Konnor Wyly for Elizon Master produced the loan history reflecting the payments
received from Lautzenheiser and the application of the payments to the principal, interest,
and escrow of the notes and mortgage.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶39} In support of his argument that he was not in breach of the terms of the
notes and mortgages, Lautzenheiser submitted his affidavit stating he had made
payments from April 2006 to February 2015, totaling $82,142.46. He provided copies of
payment book stubs, bank check receipts, account statements, money order receipts,
and annual escrow account disclosure statements. He argues the Civ.R. 56 evidence of
his payments provided the trial court with specific facts to demonstrate there was a triable
issue of fact of whether Lautzenheiser was in breach of the terms of the notes and
mortgages. That the trial court granted summary judgment in favor of Elizon Master and
Citizens Bank, Lautzenheiser argues, demonstrates the trial court considered the
credibility of the of the witnesses and found the affiants for Elizon Master and Citizens
Bank more credible.
{¶40} The decision to grant summary judgment in favor of Elizon Master and
Citizens Bank does not depend upon the credibility of the witnesses but whether there is
an absence of genuine issue of material fact after considering the Civ.R. 56 evidence in
favor of the non-moving party. At first review, the evidence in this case is like the theory
of Schrödinger’s Cat – in the box of summary judgment, reasonable minds could conclude
that Lautzenheiser made payments on the mortgages and the mortgages are in default.
The parties’ affidavits appear to support both contentions, but an analysis of
Lautzenheiser’s affidavit and his recitation of payments do not include salient facts that
impact the due and owing balance on the notes and mortgage. Lautzenheiser’s failure to
present these facts results in the conclusion that in this box of summary judgment, the
mortgages are in default.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
{¶41} First, Lautzenheiser entered into a loan modification agreement effective on
February 1, 2014. The principal balance of the mortgage on February 1, 2014 was
$74,041.96. While Lautzenheiser avers he made payments on the mortgage from 2006
to 2014, the mortgage in question was modified effective February 1, 2014 and both
Lautzenheiser and Elizon Master’s affidavits show few payments after 2014. A notice of
default was sent to Lautzenheiser on May 6, 2014. Second, while Lautzenheiser shows
he made payments on the mortgages, his payments do not reflect the percentage of the
payment that went to principal, interest, escrow, or late payment charges as stated in the
terms of the notes and mortgages. The loan history provided by Elizon Master shows the
amount of Lautzenheiser’s payments that went towards principal, interest, and escrow.
Lautzenheiser disputes the loan history presented Elizon Master’s affidavit and argues
he should be permitted to conduct additional discovery. The record shows this matter has
been pending since 2015 and has been in foreclosure mediation multiple times. There
has been ample time to develop the record and request discovery from the parties. Based
on the Civ.R. 56 evidence before the court, there is no disagreement between the parties
that Lautzenheiser made payments on the mortgages; however, reasonable minds could
only conclude that the payments did not satisfy the terms of the notes and mortgages.
{¶42} Lautzenheiser’s sole Assignment of Error is overruled.
[Cite as Wilmington Savs. Fund Soc. v. Lautzenheiser, 2021-Ohio-1046.]
CONCLUSION
{¶43} The judgment of the Stark County Court of Common Pleas is affirmed.
By: Delaney, J.,
Hoffman, P.J. and
Wise, John, J., concur.