[Cite as JPMorgan Chase Bank, Natl. Assn. v. Blank, 2014-Ohio-4135.]
IN THE COURT OF APPEALS
ELEVENTH APPELLATE DISTRICT
ASHTABULA COUNTY, OHIO
JPMORGAN CHASE BANK, OPINION
NATIONAL ASSOCIATION, :
Plaintiff-Appellee, : CASE NO. 2013-A-0060
- vs - :
LOIS M. BLANK, et al., :
Defendant-Appellant. :
Civil Appeal from the Ashtabula County Court of Common Pleas.
Case No. 2012 CV 560.
Judgment: Reversed and remanded.
Susana Lykins and Bill L. Purtell, Lerner, Sampson & Rothfuss, 120 East Fourth Street,
Suite 800, P.O. Box 5480, Cincinnati, OH 45201-5480 (For Plaintiff-Appellee).
Bruce M. Broyles, 5815 Market Street, Suite 2, Youngstown, OH 44512 (For
Defendant-Appellant).
TIMOTHY P. CANNON, P.J.
{¶1} Appellant, Lois M. Blank, appeals the September 9, 2013 judgment of the
Ashtabula County Court of Common Pleas granting summary judgment and issuing a
decree of foreclosure in favor of appellee, JPMorgan Chase Bank, National Association.
For the reasons that follow, we reverse and remand to the trial court.
{¶2} On February 25, 2008, appellant signed a promissory note payable to
Chase Bank USA, N.A in the amount of $382,500. The same day, appellant granted a
mortgage in the same amount to Chase Bank USA, N.A. on the property at 3471 Lake
Road in Conneaut, Ohio. The mortgage was recorded on February 29, 2008, and was
later assigned by Chase Bank USA, N.A. to appellee, which duly recorded the
assignment on June 25, 2012.
{¶3} According to appellee, on December 10, 2010, an acceleration warning
was mailed, “return service requested,” to appellant. The warning informed appellant
that she was in default for her failure to make the required monthly payments on her
loan, beginning with the payment due August 1, 2009. The warning also indicated the
total amount past due and payable.
{¶4} On June 28, 2012, appellee brought a complaint in foreclosure, alleging
that appellant was in default under the terms of the note and that she owed the sum of
$379,754.18. Attached to the complaint were copies of the note and mortgage. On
August 3, 2012, appellant filed her answer, which included five affirmative defenses.
{¶5} On September 12, 2012, appellee filed a motion for summary judgment,
arguing that appellant’s affirmative defenses were “insufficient to comply with the Civil
Rules’ requirement of notice pleading.” Additionally, appellee’s motion asserted that
appellant failed to set forth any specific facts that demonstrated a genuine issue of
material fact for trial.
{¶6} On January 28, 2012, appellant filed a response to appellee’s motion for
summary judgment. Attached to appellant’s response was an affidavit in which
appellant averred that she never received any notice of her default pursuant to the
terms of the promissory note and mortgage either by regular mail, certified mail, or
personal delivery.
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{¶7} On March 11, 2013, appellee filed a reply in support of its motion for
summary judgment. In its reply, appellee asserted that appellant’s affidavit attached to
her response was unexecuted and that appellee had not received an executed copy.
As a result, appellee argued the trial court could not rely on “[a]ppellant’s unexecuted
Affidavit” and that summary judgment was proper.
{¶8} On September 9, 2013, the trial court granted appellee’s motion for
summary judgment. In a separate judgment entry, also dated September 9, 2013, the
trial court filed an “entry granting summary judgment and decree in foreclosure and
reformation of mortgage.”
{¶9} Appellant timely appeals the trial court’s granting of summary judgment
and decree in foreclosure in favor of appellee. Appellee chose not to file a merit brief.
{¶10} Appellant sets forth one assignment of error, which states:
{¶11} “The trial court erred in granting summary judgment to Appellee when
there were genuine issues of material fact still in dispute.”
{¶12} Under her sole assignment of error, appellant frames three sub-issues for
our review. First, appellant contends that “[a]ppellee failed to fulfill a condition
precedent to the acceleration of the debt and the filing of the foreclosure complaint.”
Second, appellant asserts that “[t]he trial court erred in finding that Appellee had
standing to file the foreclosure * * *.” Third, appellant argues that the trial court erred in
not considering her affidavit, “as it was not a prohibited ‘self-serving’ affidavit.”
{¶13} We review a trial court’s decision on a motion for summary judgment de
novo. Fed. Home Loan Mtge. Corp. v. Zuga, 11th Dist. Trumbull No. 2012-T-0038,
2013-Ohio-2838, ¶13. Under Civ.R. 56(C), summary judgment is proper if:
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(1) No genuine issue as to any material fact remains 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.
Id. at ¶10, citing Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977).
{¶14} The moving party bears the initial burden to demonstrate from the
pleadings, depositions, answers to interrogatories, written admissions, affidavits,
transcripts of evidence, and written stipulations of fact, if any, that there is no genuine
issue of material fact to be resolved in the case. Id. at ¶12. To properly support a
motion for summary judgment in a foreclosure action, a plaintiff must present
evidentiary-quality materials showing: (1) the movant is the holder of the note and
mortgage, or is a party entitled to enforce it; (2) if the movant is not the original
mortgagee, the chain of assignments and transfers; (3) the mortgager is in default; (4)
all conditions precedent have been met; and (5) the amount of principal and interest
due. Wachovia Bank v. Jackson, 5th Dist. Stark No. 2010-CA-00291, 2011-Ohio-3203,
¶40-45. “If this initial burden is met, the nonmoving party then bears the reciprocal
burden to set forth specific facts which prove there remains a genuine issue to be
litigated, pursuant to Civ.R. 56(E).” Zuga, supra, at ¶12.
{¶15} Appellant’s three sub-issues will be considered out of order. In her
second sub-issue presented for review, appellant asserts that summary judgment was
improper, as “[t]he trial court erred in finding that appellee had standing to file the
foreclosure complaint in light of the undated allonge that was not attached to the
complaint and an assignment of mortgage without a transfer of the underlying debt.”
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{¶16} A plaintiff in a foreclosure action must have standing at the time it files the
complaint in order to properly invoke the jurisdiction of the trial court. Fed. Home Loan
Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, ¶41-42. “It is an
elementary concept of law that a party lacks standing to invoke the jurisdiction of the
court unless he has, in an individual or representative capacity, some real interest in the
subject matter of the action.” Id. at ¶22, quoting State ex rel. Dallman v. Franklin Cty.
Court of Common Pleas, 35 Ohio St.2d 176, 179 (1973). A party’s standing to sue is
evaluated at the time of the filing of the complaint. Id. at ¶24. Additionally, the lack of
standing cannot be cured by a subsequent assignment of the note and mortgage
subsequent to filing the complaint. Id. at ¶38.
{¶17} A plaintiff in a foreclosure case demonstrates standing by having an
interest in either the promissory note or mortgage. Fed. Home Loan Mtge. Corp. v.
Koch, 11th Dist. Geauga No. 2012-G-3084, 2013-Ohio-4423, ¶24, citing Fed. Home
Loan Mtge. Corp. v. Rufo, 11th Dist. Ashtabula No. 2012-A-0011, 2012-Ohio-5930, ¶18.
The requisite “interest” can be met by demonstrating an assignment of either the note or
mortgage. Rufo at ¶44. There is no standing to proceed with the foreclosure if the
interest did not exist at the time the foreclosure complaint was filed. Schwartzwald at
¶25-27.
{¶18} The assignment of a mortgage, without an express transfer of the note, is
sufficient to transfer both the mortgage and the note if the record indicates the parties’
intent to transfer both. Bank of N.Y. Mellon v. Veccia, 11th Dist. Trumbull No. 2013-T-
0101, 2014-Ohio-2711, ¶20, citing Bank of New York v. Dobbs, 5th Dist. Knox No.
2009-CA-000002, 2009-Ohio-474, ¶31. In this case, appellee attached to its complaint
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the assignment of mortgage which “assign[ed], transfer[red] and set over unto
[appellee], * * *, a certain mortgage from [appellant] to Chase Bank USA, N.A.” By
attaching a copy of the assignment of mortgage to the complaint, appellee
demonstrated the requisite standing existed at the time the foreclosure complaint was
filed.
{¶19} Appellant argues that because appellee attached to its motion for
summary judgment an undated allonge, not previously attached to appellee’s complaint,
a question of fact was created as to whether appellee had standing when the complaint
was filed. Appellant argues that had the allonge existed at the commencement of
appellee’s action, it would have appeared after the note. We disagree. The fact that
the allonge was not attached to the complaint does not require the conclusion that
appellee lacked standing.
{¶20} In this case, the record reflects the parties’ intent for the note and
mortgage to be transferred together. The mortgage states:
This Security Instrument secures to Lender: (i) the repayment of the
Loan, and all renewals, extensions and modifications of the Note;
and (ii) the performance of Borrower’s conveyance under the
Security Instrument and the Note. For this purpose, Borrower does
hereby mortgage, grant and convey to Lender the following
described property * * *.
The promissory note states:
In addition to the protections given to the Note Holder under this
Note, a Mortgage, Deed of Trust, or Security Deed (the ‘Security
Instrument’), dated the same day as this Note, protects the Note
Holder from possible losses which might result if I do not keep the
promises which I make in this Note. That Security Instrument
describes how and under what conditions I may be required to
make immediate payment in full of all amounts I owe under the
Note.
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{¶21} The language contained in the note and mortgage demonstrates the clear
intent that both be transferred together. See, e.g., LSF6 Mercury Reo Invs. v.
Garrabrant, 5th Dist. Delaware No. 13-CAE-06-0050, 2014-Ohio-901, ¶18 (the clear
intent by the parties to keep the note and mortgage together, rather than transferring the
mortgage alone, is demonstrated by the fact that the note refers to the mortgage and
the mortgage refers to the note). As a result, appellee sufficiently demonstrated
standing to enforce the note and file the foreclosure complaint. Appellant’s second sub-
issue is without merit.
{¶22} Appellant’s first and third sub-issues are considered together, as they both
argue that appellee failed to properly notify appellant of conditions precedent to
foreclosure. In appellant’s first sub-issue, she asserts that summary judgment was
improper because “[a]ppellee failed to fulfill a condition precedent to the acceleration of
the debt and the filing of the foreclosure complaint.” In appellant’s third sub-issue, she
asserts that summary judgment was improper because “[t]he trial court could consider
the affidavit of Lois M. Blank, as it was not a prohibited ‘self-serving’ affidavit.” In
summary, appellant argues that (1) appellee mailed the demand letter by way other
than first-class mail; (2) she did not receive any notice; and (3) delivery methods other
than first-class are not deemed received until actual delivery.
{¶23} “Where prior notice of default and/or acceleration is required by a
provision in a note or mortgage instrument, the provision of notice is a condition
precedent subject to Civ.R. 9(C).” Citimortgage, Inc. v. Hijjawi, 11th Dist. Lake No.
2013-L-0105, 2014-Ohio-2886, ¶17, quoting First Fin. Bank v. Doellman, 12th Dist.
Butler No. CA2006-02-029, 2007-Ohio-0222, ¶20. Additionally, a general denial of the
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performance of conditions precedent is insufficient to place performance of a condition
precedent at issue. Doellman, supra, at ¶20.
{¶24} In this case, the mortgage contained language requiring that appellant be
given notice before the acceleration of the debt and the filing of a foreclosure complaint.
Specifically, the mortgage states:
Acceleration; Remedies. Lender shall give notice to Borrower prior
to acceleration following Borrower’s breach of any covenant or
agreement in this Security Instrument * * *. The notice shall
specify: (a) the default; (b) the action required to cure the default;
(c) a date, not less than 30 days from the date the notice is given to
Borrower, by which the default must be cured; and (d) that failure to
cure the default on or before the date specified in the notice may
result in acceleration of the note secured by this Security
Instrument, foreclosure by judicial proceedings and sale of the
Property.
{¶25} The mortgage also specifies how notice is to be given. Specifically, “[a]ny
notice to Borrower in connection with this Security Instrument shall be deemed to have
been given to Borrower when mailed by first class mail or when actually delivered to
Borrower’s notice address if sent by other means.”
{¶26} In support of its motion for summary judgment, appellee offered the
affidavit of Richard H. Eubanks, a vice president for appellee. Eubanks’ affidavit stated:
1. I am authorized to execute this affidavit on behalf of [appellee].
The statements made in this Affidavit are based on my personal
knowledge.
***
4. In my capacity as Vice President, I have access to [appellee]’s
business records, maintained in the ordinary course of regularly
conducted business activity, including the business records for and
relating to the Borrower’s loan. Their records include the historic
records of Chase Home Finance LLC, which merged with [appellee]
effective May 1, 2011. I make this affidavit based upon my review
of those records relating to the Borrower’s loan and from my own
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personal knowledge of how they are kept and maintained. The
loan records for the Borrower are maintained by [appellee] in the
course of its regularly conducted business activities and are made
at or near the time of the event, by or from information transmitted
by a person with knowledge.
5. [Appellee]’s business records that relate to [appellant]’s loan I
reviewed and relied upon for the statements made in this affidavit
include but are not limited to the Note, Mortgage and [appellee]’s
electronic servicing system. True and exact copies of the Note
(Exhibit A), Mortgage (Exhibit B), Assignment (Exhibit C) and
Demand Letter (Exhibit D) are attached hereto.
{¶27} Appellant filed an affidavit in support of her memorandum in
opposition to appellant’s motion for summary judgment. Appellant’s affidavit
stated:
4. At no time prior to [ ] the filing of the complaint for foreclosure did
JPMorgan Chase Bank, National Association send a notice of
acceleration to pursuant to the terms of the mortgage.
5. I did not receive a notice of default or notice of acceleration, by
regular mail or by certified mail at any time prior to the filing of the
complaint for foreclosure.
6. No one personally delivered to me a notice of default or notice of
acceleration at any time prior to the filing of the complaint for
foreclosure.
{¶28} Upon review of the record, we hold that a genuine question of material fact
remains as to whether the required notice provisions of the mortgage had been met by
appellee. The acceleration warnings attached to Eubanks’ affidavit stated that the
notices were sent “return service requested.” Whether this is first-class mail or some
other form of delivery that would produce confirmation of receipt is not clear from the
record. Appellee offered no affidavit evidence to support that the notices were sent first-
class mail. The mortgage states notice is given upon mailing when using first-class
mail, but only upon delivery when sent through other means. Based on this plain
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language, appellee does not need to prove delivery of the notice only when using first-
class mail. Appellant’s affidavit declares that notice was not received. If notice was not
sent via first-class mail, but rather sent by other means that provides a receipt of
service, that receipt should have been provided.
{¶29} In sum, appellee did not present sufficient evidence to indicate how the
notice was sent. A question of fact exists as to whether appellee sent the notice via
first-class mail or through some other means. Once appellant contested the receipt of
notice, appellee could have offered an affidavit stating that notice was sent first-class
mail or offered proof of actual delivery if some other method was used. See,
CitiMortgage, Inc. v. Loncar, 7th Dist. Mahoning No. 11 MA 174, 2013-Ohio-2959, ¶28.
Furthermore, appellee’s affidavit does not declare that the conditions precedent were
met prior to the filing of the foreclosure complaint. See id.
{¶30} For these reasons, appellant’s first and third sub-issues are well taken.
The record in this case demonstrates that a question of fact remains as to whether
appellee complied with the notice provisions contained in the mortgage. As such,
appellant’s assignment of error has merit to the extent indicated.
{¶31} For the reasons stated in this opinion, the judgment of the trial court is
reversed and remanded to the trial court.
THOMAS R. WRIGHT, J.,
COLLEEN MARY O’TOOLE, J.,
concur.
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