[Cite as Huntington Natl. Bank v. Priest, 2014-Ohio-356.]
COURT OF APPEALS
DELAWARE COUNTY, OHIO
FIFTH APPELLATE DISTRICT
JUDGES:
HUNTINGTON NATIONAL BANK : Hon. John W. Wise, P.J.
: Hon. Patricia A. Delaney, J.
Plaintiff-Appellee : Hon. Craig R. Baldwin, J.
:
-vs- :
: Case No. 13 CAE 06 0049
CONNIE S. PRIEST, et al. :
:
Defendants-Appellants : OPINION
CHARACTER OF PROCEEDING: Civil Appeal from the Court of Common
Pleas, Case No. 12 CVE 03 0332
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: February 3, 2014
APPEARANCES:
For Plaintiff-Appellee Huntington For Defendants-Appellants
JENNIFER MONTY RICKER JOHN SHERROD
WELTMAN, WEINBERG & REIS MILLS, MILLS, FIELY & LUCAS
Lakeside Place, Suite 200 503 South Front Street
323 West Lakeside Avenue Suite 240
Cleveland, Ohio 44113 Columbus, Ohio 43215
For Plaintiff-Appellee B of A
JASON A. WHITACRE
LAURA C. INFANTE
4500 Courthouse Blvd., Suite 400
Stow, Ohio 44224
[Cite as Huntington Natl. Bank v. Priest, 2014-Ohio-356.]
Wise, P. J.
{¶1} Defendants-Appellants Connie S. Priest, et al. appeal the April 8, 2013,
decision of the Court of Common Pleas of Delaware County, Ohio, granting summary
judgment in favor of Appellees Huntington National Bank and Appellee Bank of
America.
STATEMENT OF THE FACTS AND CASE
{¶2} This case arose from a residential foreclosure action where two financial
institutions hold mortgages: Huntington National Bank holds and owns a Note and
Mortgage, and Bank of America holds a mortgage in first lien position.
{¶3} The relevant facts and procedural history are as follows:
{¶4} Connie S. Priest and Laurence E. Priest, individually and as trustees of
the Connie S. Priest Revocable Trust, are the owners of real property located at 7362
Scioto Chase Blvd., Powell, Ohio, 43065.
{¶5} On May 30, 2003, Connie S. Priest and Laurence E. Priest, both
individually and as Trustees for the Connie S. Priest Revocable Trust dated 09/14/00
signed a Promissory Note in favor of Developer's Mortgage Company ("Developers") in
the amount of two hundred three thousand dollars ($203,000.00). That Note was
endorsed in blank.
{¶6} The Promissory Note was secured upon the Real Estate by a Mortgage
given by the Priests and the Priest Trusts to Developers. Said Mortgage was executed
simultaneously with the Promissory Note and recorded with the Delaware County
Recorder's Office on June 10, 2003, as Instrument No. 200300037328.
Delaware County, Case No. 13 CAE 06 0049 3
{¶7} The Mortgage was assigned to Countrywide on May 30, 2003, and
recorded with the Delaware County Recorder's Office on October 28, 2003, as
Instrument No. 200300073544. It was further assigned to Bank of America, N.A., on
January 6, 2012, and recorded with the Delaware County Recorder's Office on January
13, 2013 at Book 1093, Page 2199-2200.
{¶8} The Note and Mortgage required the Priests and the Priest Trusts to make
monthly payments commencing on August 1, 2003, until the date of maturity, July 1,
2033. The Priests and the Priest Trusts failed to make those payments, and Bank of
America declared their loan in default and accelerated the entire balance due. The loan
account is due in the amount of $179,424.82 plus interest at the rate of 5.25% per
annum from July 1, 2010, plus late charges, advances for taxes and insurance and all
other expenditures recoverable under the Note and Mortgage under Ohio law.
{¶9} On November 24, 2006, Connie S. Priest and Laurence E. Priest executed
a Personal Line of Credit Agreement in favor of The Huntington National Bank. The
Personal Credit Line was secured by an Open-end Mortgage executed by the Priests on
November 24, 2006, conveying an interest in the real property located 7362 Scioto
Chase Blvd. The Mortgage was recorded on December 14, 2006, in the Delaware
County Recorder’s Office in Book 756, Page 1343. The Personal Line of Credit
Agreement does not require notice of default or notice of intent to accelerate. The
Priests failed to make payments, and Huntington National Bank declared their loan in
default and accelerated the entire balance due.
{¶10} At the time of the signing of the Huntington Mortgage, the Priests also
signed a Fact Owner’s Agreement stating that they currently held title to the real
Delaware County, Case No. 13 CAE 06 0049 4
property as husband and wife and further acknowledged and agreed that they would
“assist and fully cooperate with the Lender or First American Title Insurance Company,
including promptly resigning documents when necessary, to correct any defects, errors,
or omissions in the loan documents or the mortgage/deed of trust.”
{¶11} Prior to the above listed mortgages, Connie S. Priest, Trustee of the
Connie S. Priest Trust and Laurence E. Priest, Trustee of the Connie S. Priest Trust,
had previously executed an Open-end Mortgage conveying an interest in the real
property located 7362 Scioto Chase Blvd. to The Huntington National Bank on February
20, 2002 (recorded on March 18, 2002, Delaware County Recorder’s Office, Book 756,
Page 1343), July 3, 2002 (recorded on July 31, 2002, Delaware County Recorder’s
Office, Book 223, Page 280), and June 4, 2004 (recorded on June 14, 2004, Delaware
County Recorder’s Office, Book 514, Page 150).
{¶12} On March 10, 2011, Huntington National Bank ("Huntington") filed a
Complaint in Foreclosure against Connie S. Priest and Laurence Priest (the "Priests").
The Complaint named Countrywide Home Loans, Inc. ("Countrywide"), as a Defendant.
After service on the parties, Countrywide filed its Answer (with leave of court) on April
29, 2011.
{¶13} Appellants filed their Answer to the Complaint on May 23, 2011.
{¶14} On December 12, 2011, The Huntington National Bank filed a Motion for
Summary Judgment.
{¶15} On February 27, 2012, Bank of America, N.A. ("Bank of America"), with
leave of court, filed a Cross-Claim against the Priests asserting its interests in the
Countrywide Mortgage.
Delaware County, Case No. 13 CAE 06 0049 5
{¶16} On March 1, 2012, Appellants filed their Memorandum Contra Huntington
National Bank’s Motion for Summary Judgment, asserting that they executed the note
and mortgage in their individual capacity, but that the property securing the note was
not owned by them in their individual capacity.
{¶17} Appellants filed an Answer to the Cross-Claim on March 21, 2012.
{¶18} On September 10, 2012, Bank of America filed its Motion for Summary
Judgment on the Cross-Claim.
{¶19} On September 25, 2012, Appellants filed their motion in opposition.
{¶20} On April 8, 2013, the trial court issued a Judgment Entry granting both the
Huntington National Bank’s Motion for Summary Judgment and Bank of America's
Motion for Summary Judgment, which was also adopted in the Judgment Entry
Foreclosure Decree, filed May 23, 2013.
{¶21} Appellants now appeal, assigning the following Two Assignments of Error.
ASSIGNMENTS OF ERROR
{¶22} “I. THE TRIAL COURT ERRED IN GRANTING APPELLEE
HUNTINGTON NATIONAL BANK'S ("HUNTINGTON") MOTION FOR SUMMARY
JUDGMENT, LEADING TO ITS ENTRY AND DECREE OF FORECLOSURE.
{¶23} “II. THE TRIAL COURT ERRED IN GRANTING APPELLEE BANK OF
AMERICA, NA'S ("BANA") MOTION FOR SUMMARY JUDGMENT, LEADING TO ITS
ENTRY AND DECREE OF FORECLOSURE.”
“Summary Judgment Standard”
{¶24} Summary judgment proceedings present the appellate court with the
unique opportunity of reviewing the evidence in the same manner as the trial court.
Delaware County, Case No. 13 CAE 06 0049 6
Smiddy v. The Wedding Party, Inc. (1987), 30 Ohio St.3d 35, 36. Civ.R. 56(C) provides,
in pertinent part:
{¶25} “Summary judgment shall be rendered forthwith if the pleadings,
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. * * * A summary judgment shall not be
rendered unless it appears from such evidence or stipulation and only therefrom, 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 his favor.”
{¶26} Pursuant to the above rule, a trial court may not enter a summary
judgment if it appears a material fact is genuinely disputed. The party moving for
summary judgment bears the initial burden of informing the trial court of the basis for its
motion and identifying those portions of the record that demonstrate the absence of a
genuine issue of material fact. The moving party may not make a conclusory assertion
that the non-moving party has no evidence to prove its case. The moving party must
specifically point to some evidence which demonstrates the non-moving party cannot
support its claim. If the moving party satisfies this requirement, the burden shifts to the
non-moving party to set forth specific facts demonstrating there is a genuine issue of
material fact for trial. Vahila v. Hall, 77 Ohio St.3d 421, 429, 1997-Ohio-259, citing
Dresher v. Burt, 75 Ohio St.3d 280, 1996-Ohio-107.
Delaware County, Case No. 13 CAE 06 0049 7
{¶27} It is based upon this standard that we review Appellants’ Assignments of
Error.
I.
{¶28} Appellants argue that the trial court erred in granting summary judgment in
favor of Appellee Huntington National Bank. We disagree.
{¶29} Appellants claim that the trial court should not have ordered reformation in
this case, arguing that there was no mutual mistake herein because they intended to
sign the mortgage and note in their individual capacity.
{¶30} This Court reviews mortgages under general principles of contract law,
and we presume that the parties' intent “ ‘resides in the language they have chosen to
employ in the agreement.’ ” SFJV 2005, L.L.C. v. Ream, 187 Ohio App.3d 715, 2010-
Ohio-1615, citing in part Fountain Skin Care v. Hernandez, 175 Ohio App.3d 93, 2008-
Ohio-489. “ ‘If a contract is clear and unambiguous, then its interpretation is a matter of
law and there is no issue of fact to be determined.’ ” Inland Refuse Transfer Co. v.
Browning–Ferris Indus. of Ohio, Inc. (1984), 15 Ohio St.3d 321, 322. Id. In such a case,
“a court may not go beyond the plain language of the agreement to determine the
parties' rights and obligations, and it may not consider parole evidence of the parties'
intentions. (Citations omitted).” Id. The court, instead, “must give effect to the express
terms of the contract.” Id.
{¶31} As stated above, to determine if the summary judgment was appropriate in
this situation, we must construe all evidence and allegations most strongly in favor of
the non-moving party.
Delaware County, Case No. 13 CAE 06 0049 8
{¶32} In the instant case, the trial court considered the history between the
parties, i.e. that Appellants had previously executed prior mortgages on this property as
Trustee, and found that the failure to do so in this case appeared to have been the
result of a mutual mistake, rather than fraud, bad faith, or inequitable conduct by
Appellants. Although the trial court was presented with Affidavits signed by Appellants
stating they did not inadvertently sign the Mortgage in their individual capacities, such
statements, while being self-serving, also defy logic. Appellants’ position that they
intended to secure their Personal Line of Credit Note with a mortgage on property they
do not own is not credible. Appellants’ previous history of having signed multiple notes
and mortgages on this property only lends support to the conclusion that Appellants’
could not have intended otherwise in this instance.
{¶33} The trial court therefore found the equitable remedy of reformation
appropriate.
{¶34} Upon review, we concur with the trial court analysis and find summary
judgment to Appellee Huntington National Bank was appropriate.
{¶35} Appellants First Assignment of Error is overruled.
II.
{¶36} Appellants argue that the trial court erred in granting summary judgment in
favor of Appellee Bank of America. We disagree.
{¶37} Appellants maintain that Appellee Bank of America did not have standing
to file its cross-claim, arguing a break in the chain of title because the Note attached to
its cross-claim did not show a specific indorsement to Bank of America, nor was it
bearer paper.
Delaware County, Case No. 13 CAE 06 0049 9
{¶38} In a foreclosure action, the current holder of the note and mortgage is the
real party in interest. Wells Fargo Bank, N.A. v. Stovall, 8th Dist. Cuyahoga No. 91802,
2010–Ohio–236, ¶15, citing Chase Manhattan Mtge. Corp. v. Smith, 1st Dist. Hamilton
No. C–061069, 2007–Ohio–5874. Further, “a party may establish its interest in the suit,
and therefore have standing to invoke the jurisdiction of the court when, at the time it
files its complaint of foreclosure, it either (1) has had a mortgage assigned or (2) is the
holder of the note.” CitiMortgage, Inc. v. Patterson, 8th Dist. Cuyahoga No. 98360,
2012–Ohio–5894, ¶ 21, citing Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio
St.3d 13, 2012–Ohio–5017, 979 N.E.2d 1214.
{¶39} “The transfer of a promissory note secured by a mortgage operates as an
equitable assignment of the mortgage. See Fed. Home Loan Mortg. Corp. v. Rufo, 11th
Dist. Ashtabula No. 2012–A–0011, 2012–Ohio–5930, ¶ 41; Citimortgage, Inc. v. Loncar,
7th Dist. Mahoning No. 11 MA 174, 2013–Ohio–2959, ¶ 17 (“in a foreclosure action, the
holder of the note, regardless of whether it has been assigned the mortgage, has
standing not only because it is the party entitled to enforce the instrument, but because
it also has an equitable interest in the mortgage”); Citimortgage, Inc. v. Patterson, 8th
Dist. Cuyahoga No. 98360, 2012–Ohio–5894, ¶ 21 (holder of the note has standing to
foreclose).
{¶40} Here, the assignment of the Note and Mortgage to Appellee Bank of
America, successor by merger to BAC Home Loans, Inc., LP fka Countrywide Home
Loans Servicing LP was recorded on January 13, 2012. Bank of America’s cross-claim
was filed on February 27, 2012. We therefore find that at the time of such filing,
Appellee Bank of America was the holder of the Note and Mortgage.
Delaware County, Case No. 13 CAE 06 0049 10
{¶41} Appellants’ Second Assignment of Error is overruled.
{¶42} For the foregoing reasons, the judgment of the Court of Common Pleas of
Delaware County, Ohio, is affirmed.
By Wise, P.J.
Delaney, J., and
Baldwin, J., concur.
JWW/d 0113
[Cite as Huntington Natl. Bank v. Priest, 2014-Ohio-356.]