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ASSOC. OF APARTMENT OWNERS OF CENTURY CENTER, INC. v. JIN AN | HI CERTIORARI TO THE ICA – AOAO’s quitclaim deed as part of its analysis or in determining that An’s affidavit satisfied DCRCP Rule 12.1.

ASSOC. OF APARTMENT OWNERS OF CENTURY CENTER, INC. v. JIN AN | HI CERTIORARI TO THE ICA – AOAO’s quitclaim deed as part of its analysis or in determining that An’s affidavit satisfied DCRCP Rule 12.1.

IN THE SUPREME COURT OF THE STATE OF HAWAII

ASSOCIATION OF APARTMENT OWNERS OF CENTURY CENTER,
INC., by and through its Board of Directors,
Petitioner/Plaintiff-Counterclaim Defendant-Appellee,

vs.

YOUNG JIN AN, aka Young Ja Kim, AMBROSIA-SPA, INC.,
Respondents/Defendants-Counterclaimants-Appellants,

SCWC-14-0000431
CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
(CAAP-14-0000431 and CAAP-15-0000045; CIV. NO. 1RC13-1-4367)

DECEMBER 8, 2016

RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.
OPINION OF THE COURT BY RECKTENWALD, C.J.

R. Laree McGuire for petitioner

Gary Victor Dubin for respondent

This case involves a nonjudicial foreclosure by the
Association of Apartment Owners of Century Center, Inc. (the
AOAO) of a unit in the Century Center condominiums. The AOAO
purchased the unit at the foreclosure sale, and then filed a
complaint for summary possession in the District Court of the 1
First Circuit against Young Jin An aka Young Ja Kim (An) and
Ambrosia-Spa Inc. (together, Respondents).

027477530 by DinSFLA on Scribd

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Palma v. JPMORGAN CHASE BANK, NAT’L ASS’N | FL 5DCA – involuntary dismissal due to Bank’s failure to comply with a condition precedent to foreclosure

Palma v. JPMORGAN CHASE BANK, NAT’L ASS’N | FL 5DCA – involuntary dismissal due to Bank’s failure to comply with a condition precedent to foreclosure

 

JENNIFER L. PALMA, Appellant,
v.
JPMORGAN CHASE BANK, NAT’L ASS’N, ET AL. Appellees.

Case No. 5D15-3358.
District Court of Appeal of Florida, Fifth District.
Opinion filed December 2, 2016.
Appeal from the Circuit Court for Lake County, Heidi Davis, Judge.

Mark P. Stopa, of Stopa Law Firm, Tampa, for Appellant.

Elliot B. Kula, W. Aaron Daniel, and William D. Mueller, of Kula & Associates, P.A., Miami, for Appellee, JPMorgan Chase Bank, N.A. No Appearance for Other Appellee.

WALLIS, J.

Jennifer L. Palma (“Appellant”) appeals the final judgment of foreclosure in favor of JPMorgan Chase Bank, National Association (“Bank”). Appellant argues the trial court erred by denying her motion for involuntary dismissal due to Bank’s failure to comply with a condition precedent to foreclosure. We reverse and remand for entry of an involuntary dismissal.

In 1995, Appellant executed an adjustable-rate note secured by a Federal Housing Administration (“FHA”) mortgage for $61,900. The note specifically incorporated federal HUD regulations:

If Borrower defaults by failing to pay in full any monthly payment, then Lender may, except as limited by regulations of the Secretary in the case of payment defaults, require immediate payment in full of the principal balance remaining due and all accrued interest. … This Note does not authorize acceleration when not permitted by HUD regulations. As used in this Note, “Secretary” means the Secretary of Housing and Urban Development or his or her designee.

The HUD regulation at issue in this case provides, in pertinent part:

(b) The mortgagee must have a face-to-face interview with the mortgagor, or make a reasonable effort to arrange such a meeting, before three full monthly installments due on the mortgage are unpaid. If default occurs in a repayment plan arranged other than during a personal interview, the mortgagee must have a face-to-face meeting with the mortgagor, or make a reasonable attempt to arrange such a meeting within 30 days after such default and at least 30 days before foreclosure is commenced. …

24 C.F.R. § 203.604 (2013).[1]

In March 2013, Bank filed a complaint to foreclose on Appellant’s mortgage. Appellant filed an answer in which she specifically denied Bank’s allegation that it performed all conditions precedent to foreclosure, stating: “Plaintiff failed to comply with the regulations of the Secretary of Housing and Urban Development including but not limited to the obligation to provide face-to-face counseling in 24 CFR 203.604(b).”

At trial, Bank called one witness, Karen Schell, a mortgage and research officer for Bank. Through Schell’s testimony, Bank introduced, and the trial court admitted, the original note, the original mortgage, and the loan payment history. After Bank rested, Appellant moved for involuntary dismissal, arguing Bank failed to comply with section 203.604 before filing its foreclosure complaint. Bank responded that Appellant must establish Bank’s alleged noncompliance with section 203.604 as an affirmative defense, and the trial court agreed.

Appellant recalled Schell, who testified that she did not know whether Appellant refused to participate in a face-to-face interview, stating she did not “have information on the interview.” However, Schell testified that it was Bank’s “practice to have face-to-face interviews on these loans.” Appellant testified that she would have participated in an interview, but Bank never offered her that opportunity. After Appellant rested, she renewed her motion for involuntary dismissal, arguing she established that Bank failed to comply with section 203.604. The trial court disagreed and granted judgment of foreclosure for Bank in the amount of $51,831.15.[2]

We find that the trial court erred by requiring Appellant to raise Bank’s noncompliance with section 203.604 as an affirmative defense. While a plaintiff may plea a general satisfaction of all conditions precedent, a defendant’s corresponding “denial of performance or occurrence shall be made specifically and with particularity.” Fla. R. Civ. P. 1.120(c). “A specific denial of a general allegation of the performance or occurrence of conditions precedent shifts the burden to the plaintiff to prove the allegations concerning the subject matter of the specific denial.” Sheriff of Orange Cty. v. Boultbee, 595 So. 2d 985, 987 (Fla. 5th DCA 1992) (citing Fid. & Cas. Co. of N.Y. v. Tiedtke, 207 So. 2d 40 (Fla. 4th DCA 1968), quashed on other grounds, 222 So. 2d 206 (Fla. 1969); 1967 comments to Fla. R. Civ. P. 1.120(c)); accord Nelson v. Hillsborough Cty., 189 So. 3d 1037, 1039 (Fla. 2d DCA 2016). This type of specific denial “is not an `affirmative defense,’ which relates only to matters of `avoidance.’ Rather, it is a special form of denial that must be pled with specificity.” Motor v. Citrus Cty. Sch. Bd., 856 So. 2d 1054, 1056 n.1 (Fla. 5th DCA 2003) (Torpy, J., concurring)(citations omitted). The most common condition precedent in the mortgage foreclosure context lies in paragraph twenty-two of a standard mortgage, which requires the lender to send a default letter to the borrower before foreclosure. See, e.g., Colon v. JP Morgan Chase Bank, NA, 162 So. 3d 195, 196 (Fla. 5th DCA 2015)(“Paragraph 22 of the mortgage creates a condition precedent that Bank must satisfy prior to accelerating the loan and commencing the foreclosure action.” (citation omitted)).[3]

Though no Florida appellate court has held that section 203.604 constitutes a condition precedent to foreclosure, our court considered the issue in Diaz v. Wells Fargo Bank, N.A., 189 So. 3d 279 (Fla. 5th DCA 2016). In Diaz, the borrowers specifically denied in their answer that the bank complied with all conditions precedent to foreclosure, including section 203.604. Id. at 283. However, our court focused on the fact that the borrowers’ note and mortgage did not specifically incorporate HUD regulations:

Unlike scenarios where conditions precedent are ascertainable on the face of a written contract, such as compliance with paragraph twenty-two of the mortgage or where a promissory note specifically incorporates the HUD regulations into its terms, it is by no means clear that the HUD regulations applicable to federally insured loans apply to the instant loan and litigation.

Id. at 284. Under these circumstances, our court held that when “it is unclear whether alleged conditions precedent apply, the burden is on the party asserting the existence of the conditions precedent to establish their applicability.” Id. at 285.

Here, unlike in Diaz, Appellant’s note and mortgage specifically incorporate HUD regulations. Cf. id. at 284. The facts of the case at bar clearly require compliance with HUD regulations, including the face-to-face interview requirement outlined in section 203.604 as a condition precedent to foreclosure. We find no meaningful reason to treat compliance with section 203.604 in an FHA mortgage differently than compliance with paragraph twenty-two in a standard mortgage, which our court has determined is a condition precedent to foreclosure. See Colon, 162 So. 3d at 196. Appellant specifically denied in her answer that Bank complied with all conditions precedent, stating that Bank did not engage in a face-to-face interview as mandated by section 203.604. This shifted the burden back to Bank to prove at trial that it complied with this section. See Boultbee, 595 So. 2d at 987. Bank wholly failed to meet its burden, providing no evidence that it engaged in a face-to-face interview before filing its foreclosure complaint. Bank additionally failed to demonstrate that any of the enumerated exceptions to the interview requirement applied. Accordingly, we reverse the final judgment of foreclosure and remand with instructions to enter an involuntary dismissal.

REVERSED and REMANDED with INSTRUCTIONS.

BERGER, J. and ORFINGER, M.S., Associate Judge, concur.

NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED

[1] This section contains several exceptions to the interview requirement, none of which apply here. See 24 C.F.R. § 203.604(c)(1)-(5).

[2] The trial court commented that it believed the law of the case doctrine controlled because a predecessor judge denied Appellant’s motion to dismiss, which similarly raised Bank’s noncompliance with section 203.604. We note that this doctrine applies only “to rulings on questions of law actually presented and considered on a former appeal.” Concrete Pipe Co. v. Bould, 437 So. 2d 1061, 1063 (Fla. 1983) (citation omitted). The trial court erred insofar as it relied on this ground for denying Appellant’s motion for involuntary dismissal.

[3] We are mindful of our supreme court’s decision in Custer Medical Center v. United Auto Insurance Co., which explained that “a defending party’s assertion that a plaintiff has failed to satisfy conditions precedent necessary to trigger contractual duties under an existing agreement is generally viewed as an affirmative defense, for which the defensive pleader has the burden of pleading and persuasion.” 62 So. 3d 1086, 1096 (Fla. 2010). However, Custer involved an insurer’s affirmative defense seeking to avoid liability for PIP payments due to the insured’s failure to attend a medical examination. Id. at 1090. Custer is distinguishable from the instant case because Appellant does not seek to avoid liability under the agreement; she argues that Bank prematurely filed suit before complying with all pre-foreclosure requirements. This case is more analogous to those in which the defendant specifically denied that the plaintiff performed all pre-suit notice requirements, which shifted the burden back to the plaintiff to address the subject matter of the denial. See Nelson, 189 So. 3d at 1039; Boultbee, 595 So. 2d at 987.

 

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Pittman v. Regions Bank, Ala: Court of Civil Appeals | genuine issue of material fact exists as to whether Regions had lawful title to the property when it sought to eject the Pittmans from the property

Pittman v. Regions Bank, Ala: Court of Civil Appeals | genuine issue of material fact exists as to whether Regions had lawful title to the property when it sought to eject the Pittmans from the property

 

Windham Todd Pittman, Rhonda Pittman, and Jonathan Pittman
v.
Regions Bank d/b/a Regions Mortgage.

No. 2150455.
Court of Civil Appeals of Alabama.
December 2, 2016.
Appeal from Geneva Circuit Court, (CV-14-900095).

This opinion is subject to formal revision before publication in the advance sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-0649), of any typographical or other errors, in order that corrections may be made before the opinion is printed in Southern Reporter.

THOMPSON, Presiding Judge.

Windham Todd Pittman (“Windham”), Rhonda Pittman (“Rhonda”), and Jonathan Pittman (hereinafter referred to collectively as “the Pittmans”) appeal from a summary judgment entered in favor of Regions Bank, doing business as Regions Mortgage (“Regions”), in its ejectment action against the Pittmans. Specifically, Regions sought to recover possession of certain real property in Daleville (“the property”) that had been foreclosed upon and that was occupied by the Pittmans.

The evidentiary submissions the parties filed in support of and in opposition to Regions’ motion for a summary judgment indicate the following. Land Ventures for 2, LLC (“Land Ventures”)(which is not a party to this appeal), Windham, and Rhonda (hereinafter referred to collectively as “the borrowers”) obtained a $650,000 loan from Access Mortgage Corporation (“Access”) to purchase the property. On April 15, 2008, Windham, both as the managing member of Land Ventures and in his individual capacity, and Rhonda executed a promissory note, which was secured by a mortgage on the property. The mortgage was executed only by Windham as the managing member of Land Ventures. On June 29, 2009, Windham, again both as the managing member of Land Ventures and in his individual capacity, executed a loan-modification agreement. That agreement was among Land Ventures as the borrower, Regions as the lender or mortgage servicer, and Mortgage Electronic Registration Systems, Inc. (“MERS”), solely as the nominee for the “lender and lender’s successors and assigns,” as the mortgagee. On May 7, 2010, MERS, acting solely as nominee for Access, assigned the mortgage and the note to Regions.

It is undisputed that the borrowers failed to make the required monthly payments. Steven Purser, a vice president of Regions who serves as the manager of the “Real Estate Owned” Department, testified in his affidavit that Regions last received a payment from the borrowers on August 5, 2011. That payment had been due in April 2010, Purser said.

Windham submitted three affidavits at different times to oppose Regions’ motion for a summary judgment. In his affidavits, Windham testified that he did not receive proper notice of the default and that was he was not given an opportunity to cure the default. He also stated that he was not provided with proper notice of intent to accelerate, proper notice of acceleration, or proper notice of the foreclosure sale, which, he says, was required by law and by the mortgage contract. Windham also listed a number of other items that he says he should have received before foreclosure was proper. No documents from Regions to the borrowers indicating Regions’ intent to accelerate the note or to foreclose on the property are contained in the record before us.

In an affidavit, Windham also estimated that the property had a market value of approximately $658,000. In at least one of his affidavits, Windham said that his opinion was based on his knowledge of the neighborhood and the house, the corresponding values of similar properties in the neighborhood, and recent sales of similar properties. Windham testified that the property included six separate parcels that he described as “distinct” and not contiguous. One of the parcels included the Pittmans’ residence.

In his affidavits, Windham stated that he had asked Regions to sell the property in separate parcels rather than en masse. Windham opined that the property would have sold for more money if the individual parcels making up the property had been sold separately. He also said that, had the parcels been sold separately, he “could have potentially redeemed just the parcel where my family’s home is located.” Regions refused his request, Windham said.

Regions began foreclosure proceedings on the property in 2012. After publication of the appropriate notices in a Geneva County newspaper, the foreclosure sale was held on March 7, 2013. Purser testified that Regions submitted the highest and best bid of $367,500 and that the property was sold to Regions pursuant to the power-of-sale clause contained in the mortgage. The foreclosure deed, dated March 7, 2013, is included in the record. We note that the foreclosure deed includes the six parcels discussed in Windham’s affidavits. On March 7, 2013, attorneys for Regions sent a letter to Land Ventures, in care of Windham, demanding that the property be vacated within ten days. The Pittmans did not vacate at least the parcel on which their house was located, and Regions filed this ejectment action on October 28, 2014, seeking the Pittmans’ removal.

After a hearing on Regions’ motion for a summary judgment and after allowing the parties to file supplemental submissions, the trial court entered a summary judgment in favor of Regions on November 9, 2015. The Pittmans filed a timely motion to alter, amend, or vacate the judgment, which the trial court denied on January 14, 2016. The Pittmans appealed the judgment to the Alabama Supreme Court, which transferred the appeal to this court pursuant to § 12-2-7(6), Ala. Code 1975.

On appeal, as they did before the trial court, the Pittmans raise a number of challenges to the validity of the underlying foreclosure. They assert that, in their evidentiary submission in opposition to Regions’ motion, they raised a number of factual questions that Regions failed to refute with evidence of its own. Therefore, the Pittmans argue, the trial court erred in entering a summary judgment in favor of Regions.

“This Court’s review of a summary judgment is de novo. Williams v. State Farm Mut. Auto. Ins. Co., 886 So. 2d 72, 74 (Ala. 2003). We apply the same standard of review as the trial court applied. Specifically, we must determine whether the movant has made a prima facie showing that no genuine issue of material fact exists and that the movant is entitled to a judgment as a matter of law. Rule 56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of Alabama v. Hodurski, 899 So. 2d 949, 952-53 (Ala. 2004). In making such a determination, we must review the evidence in the light most favorable to the nonmovant. Wilson v. Brown, 496 So. 2d 756, 758 (Ala. 1986). Once the movant makes a prima facie showing that there is no genuine issue of material fact, the burden then shifts to the nonmovant to produce `substantial evidence’ as to the existence of a genuine issue of material fact. Bass v. SouthTrust Bank of Baldwin County, 538 So. 2d 794, 797-98 (Ala. 1989); Ala. Code 1975, § 12-21-12. `[S]ubstantial evidence is evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.’ West v. Founders Life Assur. Co. of Fla., 547 So. 2d 870, 871 (Ala. 1989).”

Dow v. Alabama Democratic Party, 897 So. 2d 1035, 1038-39 (Ala. 2004).

Regions filed its ejectment action against the Pittmans pursuant to § 6-6-280, Ala. Code 1975. That statute provides, in pertinent part, as follows:

“An action for the recovery of land or the possession thereof in the nature of an action in ejectment may be maintained without a statement of any lease or demise to the plaintiff or ouster by a casual or nominal ejector, and the complaint is sufficient ifit alleges that the plaintiff was possessed of the premises or has the legal title thereto, properly designating or describing them, and that the defendant entered thereupon and unlawfully withholds and detains the same.”

§ 6-6-280(b). Therefore, to prevail on its motion for a summary judgment, Regions was required to present substantial evidence establishing that it had legal title to the property and that the Pittmans unlawfully remained on the property. Id. See also Turner v. Wells Fargo Bank, N.A., [Ms. 2150320, Sept. 30, 2016] ___ So. 3d ___, ___ (Ala. Civ. App. 2016).

The Pittmans assert numerous grounds that they say demonstrate that Regions did not have legal title to the property; thus, they say, the summary judgment entered for Regions in its ejectment action was improper. Among other reasons as to why they believe the foreclosure was improper, the Pittmans contend that Regions failed to provide them with proper notice of intent to accelerate the note and with proper notice of intent to foreclose, as required by Section 22 of the mortgage. The Pittmans also contend that Regions was not a real party in interest because, they say, there was no evidence that Regions was a “holder” of the note. Additionally, they challenge Regions’ refusal to sell the property in separate parcels rather than en masse.

Regions contends that it is not required to provide a “full point-by-point rebuttal” of the Pittmans’ contentions challenging the foreclosure of the property because, it says, the Pittmans waived their right to challenge the foreclosure by not doing so in a timely manner. We agree with Regions that some of the many grounds the Pittmans assert for arguing that the foreclosure was improper cannot be used as defenses in this ejectment action, although not necessarily for the reasons Regions suggests. However, Regions’ argument is not applicable to all the grounds the Pittmans raised in defense of this action.

“Not all irregularities in the foreclosure process, but only those irregularities that would render the foreclosure sale void, may be raised as affirmative defenses to an ejectment action.” Campbell v. Bank of America, N.A., 141 So. 3d 492, 499 (Ala. Civ. App. 2012). In Campbell, this court explained:

“An ejectment action following a nonjudicial foreclosure . . . is not a `foreclosure action,’ and a defense in such an action asserting errors in the foreclosure process is a collateral attack on a foreclosure. See Dewberry v. Bank of Standing Rock, 227 Ala. 484, 493, 150 So. 463, 470 (1933) (characterizing the action in Jones v. Hagler, 95 Ala. 529, 10 So. 345 (1891), in which the plaintiff sought possession of certain property he had purchased from a trustee, who had sold the property pursuant to a power of sale in a deed of trust, and in which the defendant had asserted irregularities in the sale, as `a statutory action in the nature of ejectment—an indirect or collateral attack upon the foreclosure of real and personal property sold by a trustee, under the power [of sale in a deed of trust]’ (some emphasis in original; some emphasis added)). Accord Pinkert v. Lamb, 215 Ark. 879, 883, 224 S.W.2d 15, 17 (1949)(stating that an ejectment action is a `collateral attack by appellees on the. . . foreclosure decree and sale . . ., and the burden [is] on them to prove such defects therein as would render the sale and decree void’); Dime Sav. Bank, FSB v. Greene, 2002 Pa. Super. 392, 813 A.2d 893, 895 (2002) (stating that `[a]n ejectment action is a proceeding collateral to that under which the land was sold’ and that, `where it is claimed that [an] underlying default judgment [in a judicial-foreclosure action] is merely voidable, that claim will not be entertained because such a judgment can not be reached collaterally’).

“In a direct attack on a foreclosure—that is, an action seeking declaratory and injunctive relief to halt the foreclosure sale before it occurs, see, e.g., Ferguson v. Commercial Bank, 578 So. 2d 1234 (Ala. 1991); Bank of Red Bay v. King, 482 So. 2d 274 (Ala. 1985); and Woods v. SunTrust Bank, 81 So. 3d 357 (Ala. Civ. App. 2011), or an action to set aside the sale after it has occurred, see, e.g., Beal Bank, SSB v. Schilleci, 896 So. 2d 395 (Ala. 2004); Kelly v. Carmichael, 217 Ala. 534, 536, 117 So. 67, 69 (1928); and Browning v. Palmer, 4 So. 3d 524 (Ala. Civ. App. 2008)—any circumstance in the foreclosure process that would render the foreclosure sale void or voidable may be asserted. In a proceeding involving a collateral attack on a foreclosure, however, only those circumstances that would render the foreclosure sale void may be raised as an affirmative defense.”

Campbell, 141 So. 3d at 494.

In Campbell, after discussing generally the “types of flaws” that may occur in the foreclosure process, 141 So. 3d at 495, this court discussed the circumstances under which a collateral attack of a foreclosure of real property can be used as an affirmative defense in an ejectment action in Alabama. Among the circumstances that may render a foreclosure sale void, this court noted, were “(1) when the foreclosing entity does not have the legal right to exercise the power of sale, as, for example, when that entity is neither the assignee of the mortgage . . . nor the holder of the promissory note . . . at the time it commences the foreclosure proceedings,” 141 So. 3d at 95, or

“(2) when `the debt secured by the mortgage was fully paid prior to foreclosure,’ Lee v. Gaines, 244 Ala. 664, 666, 15 So. 2d 330, 331 (1943); (3) when the foreclosing entity failed to give notice of the time and place of the foreclosure sale, Sanders v. Askew, 79 Ala. 433 (1885),but see Kelley Realty Co. v. McDavid, 211 Ala. 575, 577, 100 So. 872, 873-74 (1924) (stating that `a distinction must be made between cases where there is no sort of compliance with the requirement of advertisement or other notice of the sale, and cases where there is actually given some notice of the nature required, sufficient to give public information of the pendency and date of the sale, though it be ever so defective or incomplete,’ and that `[i]n the latter class of cases the foreclosure sale will not be void, but voidable only to the election of the mortgagor, properly and seasonably asserted’); and (4) when the purchase price paid is `”so inadequate as to shock the conscience, it may itself raise a presumption of fraud, trickery, unfairness, or culpable mismanagement, and therefore be sufficient ground for setting the sale aside,'” Hayden v. Smith, 216 Ala. 428, 430, 113 So. 293, 295 (1927).”

Campbell, 141 So. 3d at 495-96.

In elaborating on the fourth ground, quoted above, for which a foreclosure may be rendered void, the Campbell court explained that in Berry v. Deutsche Bank National Trust Co., 57 So. 3d 142 (Ala. Civ. App. 2010),

“a majority of this court reversed a summary judgment in favor of the mortgagee, holding that there was a genuine issue of material fact as to whether `the foreclosure sale was invalid on the ground that the price realized at the foreclosure sale was so low in relation to the market value of the property as to shock the conscience, which would constitute an affirmative defense to [the mortgagee’s] ejectment claim,’ 57 So. 3d at 149. That holding is consistent with the general principle previously discussed that, if the purchase price is so inadequate as to shock the conscience and raise a presumption of fraud, the inadequacy is a circumstance that may render the foreclosure sale void in Alabama. See Hayden v. Smith, [216 Ala. 428, 113 So. 293 (1927)].”

Campbell 141 So. 3d at 499.

Finally, the Campbell court discussed Hawkins v. LaSalle, Bank N.A., 24 So. 3d 1142 (Ala. Civ. App. 2009), overruled on another ground, Berry v. Deutsche Bank National Trust Co., 57 So. 3d 142 (Ala. Civ. App. 2010), and recognized “a line of Alabama cases that appears to point toward there being a fifth circumstance that will render a foreclosure sale void in Alabama: when an en masse sale injures the mortgagor and violates the mortgagee’s duty of fairness and good faith in executing the power of sale.” Campbell, 141 So. 3d at 500. This court then concluded that the holdings in Berry and Hawkins were “consistent with the general principle that irregularities in the foreclosure process that would render the foreclosure sale void may be raised as affirmative defenses to an ejectment action.” Id.

Regions counters by arguing that the affirmative defense of an improper foreclosure is untimely ifit is raised more than one year after the foreclosure sale. In support of that proposition, Regions cites Hawkins v. LaSalle Bank, supra. In that case, LaSalle Bank, N.A. (“LaSalle”), sought ejectment of Hawkins from property it had purchased as a result of a foreclosure sale. LaSalle was the holder of the mortgage at the time of the sale. 24 So. 3d at 1144-45. LaSalle argued that the summary judgment entered in that case was due to be affirmed because Hawkins had failed to file a counterclaim or to attempt to redeem the subject property within the one-year redemption period set forth in § 6-5-252, Ala. Code 1975. Id. at 1152. As to this issue, this court wrote:

“The trial court rejected that argument, concluding that LaSalle was put on notice less than one year after the foreclosure sale that Hawkins was raising the defense that the foreclosure sale was improper, that Hawkins had amended his answer to specifically plead that defense, and that the amendment related back, pursuant to Rule 15(c), Ala. R. Civ. P., to the date of Hawkins’s original answer, filed on October 18, 2006. We agree with the trial court that that amendment related back to the date of the original answer.”

Id.

In Hawkins, this court rejected LaSalle’s contention that, pursuant to Muller v. Seeds, 919 So. 2d 1174 (Ala. 2005), Hawkins could not prevail in LaSalle’s ejectment action against him because he had failed to file a counterclaim challenging the foreclosure sale. This court explained:

“Muller does not stand for the proposition that the invalidity of a foreclosure sale may be raised only in a counterclaim to an ejectment action. Muller merely held that when the invalidity of a foreclosure sale is raised only in a counterclaim, that counterclaim will not be considered a defense to the ejectment action. In this case, Hawkins specifically pleaded the invalidity of the foreclosure sale as a defense to the ejectment action. As such, under Muller, by presenting substantial evidence in support of that defense, Hawkins presented sufficient evidence to defeat LaSalle’s motion for a summary judgment.”

Hawkins, 24 So. 3d at 1152-53.

In this case, the Pittmans did not file a counterclaim or a separate action seeking to have the foreclosure set aside as invalid. However, they have challenged the validity of the foreclosure sale as a defense to Regions’ ejectment action. One of the elements Regions is required to prove to prevail in this action is that it had legal title to the property. See § 6-6-280(b). As a defense to Regions’ action, the Pittmans have asserted that Regions does not have legal title because the foreclosure sale was void. We find no authority to support the contention that such a defense to an ejectment action must be raised within a year of the foreclosure, as Regions argues. If the party seeking the ejectment of the possessor of property does not hold legal title to that property, it cannot prevail in its ejectment action. § 6-6-280(b); see also Turner, ___ So. 3d at ___. Therefore, if the Pittmans presented substantial evidence tending to show that a genuine issue of material fact existed indicating that the foreclosure was void, the summary judgment would be improper.

The Pittmans have challenged the foreclosure on three of the grounds that will render a foreclosure sale void and could, therefore, serve as affirmative defenses to Regions’ ejectment action: (1) that Regions was not the assignee of the mortgage, (2) that Regions’ purchase price of the property was so inadequate as to shock the conscience and raise a presumption of fraud, and (3) that Regions’ sale of the property en masse rather than in discrete parcels injured the Pittmans and violated Regions’ duty of fairness and good faith in executing the power of sale.

In Campbell, supra, this court noted that there is

“a long line of Alabama cases (a) indicating that a sale in parcels or lots is desirable because it “`opens a field to a greater number of bidders, is conducive to a better price, tends to prevent odious speculation upon the distress of the debtor, and enables him to redeem some of the property without being compelled to redeem it all,'” Hawkins, 24 So. 3d at 1149(quoting J.H. Morris, Inc. v. Indian Hills, Inc., 282 Ala. 443, 455, 212 So. 2d 831, 843 (1968)), and (b) holding, for the most part, that an en masse sale that causes injury to the mortgagor violates the mortgagee’s duty of fairness and good faith in executing the power of sale and is, therefore, sufficient to invalidate the sale and the foreclosure deed.”

141 So. 3d at 499-500.

The rationale for the preference that discrete parcels of property be sold in separate sales rather than en masse was explained in Muller v. Seeds, 975 So. 2d 914 (Ala. 2007):

“In Kelly v. Carmichael, 217 Ala. 534, 117 So. 67 (1928), this Court discussed the propriety of a foreclosure sale conducted en masse when the property foreclosed is capable of being sold in separate parcels:

“`The power of sale in a mortgage is not only a power [coupled] with an interest, but it is quickened with an element of trust, “and the donee of the power is charged as a quasi trustee with the duty of fairness and good faith in its execution, to the end that the mortgagor’s property may be disposed of to his pecuniary advantage in the satisfaction of his debt.”

“`. . . .

“`The reason of the rule requiring property covered by a mortgage or lien which is in “separate parcels, distinctly marked for separate and distinct enjoyment,” to be first offered for sale in parcels rather than en masse, is that a sale in parcels or lots opens a field to a greater number of bidders, is conducive to a better price, and “tends to prevent odious speculation upon the distress of the debtor,” and enables him to redeem some of the property without being compelled to redeem it all. . . . And this rule applies “where the property covered by the mortgage is separated into several distinct lots, either by natural boundaries, by the way in which it is platted or laid out, or by the fact that the parcels are not contiguous,” (41 C.J. 973, § 1421), and inures to the benefit of a party who has acquired rights in subordination to the mortgage by a conveyance from the debtor (Brock et al. v. Berry, 132 Ala. 95, 31 So. 517, 90 Am. St. Rep. 896 [(1901)]).’

Kelly, 217 Ala. at 537-38, 117 So. at 70-71. The Court elaborated on this rule in J.H. Morris, Inc. v. Indian Hills, Inc., 282 Ala. 443, 455, 212 So. 2d 831, 843 (1968):

“`When the mortgaged land consists of widely separated lots, some of which are dedicated to separate and distinct uses, and are sold by the mortgagee, at one time en masse, and by that means are caused to bring a sum much less than their real value, equity should avoid the sale and let the complainants in to exercise their equity of redemption. A mortgagee is, in a sense, a trustee for the mortgagor, and, in exercising the power of sale contained in the mortgage, the mortgagee must not disregard the rights of the mortgagor. The rule requiring that separate parcels be offered for sale separately arises out of the reasonable presumption, sanctioned by observation and experience, that property in distinct parcels, distinctly marked for separate and distinct enjoyment, will produce more when sold in parcels because the sale is thus accommodated to the probable wants of the purchasers. Of course, if such property is sold en masse and brings a fair price, the mortgagor will not be heard to complain. When a sale and purchase en masse are had under the power of sale contained in a mortgage, the mortgagor, if the purchaser acquires the property at a sum disproportionate to its real value, may, by seasonable action, have the sale annulled. Dozier v. Farrior, 187 Ala. 181, 65 So. 364 [(1914)].'”

Muller, 975 So. 2d at 918-19.

In this case, it is undisputed that the property comprised six distinct parcels and that the parcels were sold en masse. Regions’ single foreclosure deed includes each of the separate parcels in the description of the property purchased at the foreclosure sale. The parcels are not contiguous. In opposition to the summary-judgment motion, the Pittmans submitted Windham’s affidavits, in at least two of which he testified that the six parcels are not contiguous, are not related, and are taxed separately. The Pittmans’ residence is situated on one of the parcels. Windham testified that he made repeated requests of Regions that the parcels be sold separately. He said that he made the requests “because [he] knew that it would be easier to sell the property separately instead of together and that each parcel might fetch a better price individually than if the parcels were sold together.” In one of his affidavits, Windham testified that he also asked Regions to sell the parcels separately

“so that [he] could later potentially redeem just the property with the home and not the other parcels of property which are vacant lots. I knew my ability to redeem just the parcel with the home would be something I could do after the foreclosure sale. However, by selling all of the properties at one sale, [Regions] inhibited my ability to keep the home or redeem it. This prevented me from redeeming the home, as I would have to redeem all of the property since it was all included in one sale. This clearly injured me and my family and hampered my ability to redeem the property where my home is located.”

Regions did not submit any evidence to the trial court to refute Windham’s testimony.

We conclude that the Pittmans presented substantial evidence indicating that Regions refused their request to sell the property in separate parcels and that they were injured when the property was sold en masse. Therefore, there is a genuine issue of material fact as to whether Regions violated its duty of fairness and good faith in executing the power of sale, which would render the foreclosure void. Campbell, 141 So. 3d at 500. Accordingly, the Pittmans have demonstrated that a genuine issue of material fact exists as to whether Regions had lawful title to the property when it sought to eject the Pittmans from the property.

Because there was a genuine issue of material fact before the trial court as to the validity of the foreclosure sale, and because voiding of the foreclosure sale would necessarily defeat Regions’ ejectment action, we reverse the trial court’s summary judgment in favor of Regions, and we remand the cause for further proceedings. We pretermit discussion of the other grounds for reversal raised by the Pittmans on appeal.

REVERSED AND REMANDED.

Pittman, Thomas, Moore, and Donaldson, JJ., concur.

© 2010-16 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUD0 Comments

Bank of America, NA v. DARKADAKIS | OH Appeals Court – Bank had no standing because he did not sign the note or mortgage…barred from SOL

Bank of America, NA v. DARKADAKIS | OH Appeals Court – Bank had no standing because he did not sign the note or mortgage…barred from SOL

2016-Ohio-7694

BANK OF AMERICA, N.A., SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING LP, fka COUNTRYWIDE HOME LOANS SERVICE, LP, Plaintiff-Appellee,
v.
WILLIAM DARKADAKIS, et al., Defendants-Appellant.

No. 14 MA 0076.
Court of Appeals of Ohio, Seventh District, Mahoning County.
Dated: November 1, 2016.
Civil Appeal from Court of Common Pleas of Mahoning County, Ohio Case No. 12CV01962.

Reversed and Remanded.

Atty. William Joseph Baker, 1300 East Ninth St., Suite 1600, Cleveland, Ohio 44114, Atty. Sherrie Mikhail Mlday, P.O. Box 165028, Columbus, Ohio 43216, for Plaintiff-Appellee.

Atty. Edwin Romero, Atty. Thomas F. Hull II, 201 E. Commerce St., Atrium Level Two, Commerce Building, Youngstown, Ohio 44503, for Defendants-Appellants.

Judges: Hon. Gene Donofrio, Hon. Carol Ann Robb, Hon. Stephen A. Yarbrough, Sitting by, Assignment.

OPINION

DONOFRIO, P.J.

{¶1} Defendant-appellant, William Darkadakis, appeals from a Mahoning County Common Pleas Court judgment granting a decree in foreclosure for plaintiff-appellee, Bank of America, N.A., Successor by merger to BAC Home Loans Servicing LP, fka Countrywide Home Loans Servicing LP (the Bank).

{¶2} On June 25, 2012, the Bank initiated a foreclosure action against William and Elizabeth Darkadakis for the property located at 10450 New Buffalo Road, Canfield Ohio. On September 4, 2004, Elizabeth signed a note with the Bank’s predecessor for $207,000.00. As collateral for that note, Elizabeth signed a mortgage to the property. Her initials and William’s initials were on the mortgage but William did not sign the signatory page of the mortgage.

{¶3} At the time Elizabeth signed the mortgage and note, the property was in William’s name only. In an affidavit attached to the Bank’s motion for summary judgment, Elizabeth claimed that throughout their marriage ownership of the property was constantly transferred between her, William, and other third parties. But nothing in her affidavit indicated that at the time she signed the note and mortgage she was listed as an owner of the property. William, in his affidavit, disputed Elizabeth’s claims that the property was continually transferred and asserted the property was never deeded in Elizabeth’s name. The appraisal in July 2004, prior to the execution of the note and mortgage, stated William was the owner of the property. It did not list Elizabeth as the owner.

{¶4} During the foreclosure proceedings William and Elizabeth divorced. Their February 14, 2013 divorce decree stated that the parties agreed the real estate would remain solely in William’s name.

{¶5} As the foreclosure action proceeded, the Bank filed for summary judgment and sought reformation of the mortgage. The Bank claimed it was a mutual mistake that William did not sign the note and mortgage. It also asserted William would be unjustly enriched if he were able to retain the property. Elizabeth’s affidavit was attached to this motion. In her affidavit she stated it was a mistake that William did not sign the mortgage.

{¶6} William filed a motion in opposition. He claimed reformation and unjust enrichment were new claims. He asserted the Bank had no standing because he did not sign the note or mortgage. He argued unjust enrichment was barred by the statute of limitations, there was no mutual mistake, and parol evidence could not be used to support reformation.

{¶7} The Bank filed a reply focusing on the facts that William initialed every page of the mortgage and the mortgage was used to pay off a pervious note and mortgage for which William was liable.

{¶8} On June 11, 2014, the trial court granted summary judgment for the Bank and held it was entitled to a judgment and decree in foreclosure. The court found it was the intent of the parties for the mortgage to encumber the entire property, and thus, reformation was appropriate. It held reformation was not precluded by parol evidence or the statute of frauds. It also found the unjust enrichment claim was not barred by the statute of limitations and William would be unjustly enriched if the mortgage did not encumber the entire property. Lastly, it stated the Bank had standing to seek foreclosure because the uncontradicted evidence established it was a holder of the note and mortgage at the time the complaint was filed.

{¶9} William filed an appeal from that decision with this court. We found the judgment was not a final appealable order because it did not enter a monetary amount on the award of summary judgment and did not resolve the issue of liens. We granted a 60-day limited remand for William to obtain a final appealable order from the trial court.

{¶10} Upon remand the parties filed additional motions. William filed a motion for summary judgment on February 5, 2015. The arguments raised in this motion were the same arguments raised in his motion in opposition to summary judgment. The Bank filed a motion in opposition and a motion to strike on February 23, 2015.

{¶11} On April 21, 2015, the trial court struck William’s motion for summary judgment finding the matter was remanded from the court of appeals for the limited purpose of issuing a final appeal order on the remaining issues. It stated the only remaining issue was the default of Elizabeth on the promissory note and mortgage.

{¶12} That same day the trial court issued the judgment entry and decree in foreclosure. Thereafter, William amended his notice of appeal to include this judgment.

{¶13} William now raises six assignments of error. His first assignment of error states:

THE TRIAL COURT ERRED IN AWARDING SUMMARY JUDGMENT TO THE BANK.

{¶14} An appellate court reviews the granting of summary judgment de novo. Comer v. Risko, 106 Ohio St.3d 185, 2005-Ohio-4559, 833 N.E.2d 712, ¶ 8. Thus, we shall apply the same test as the trial court in determining whether summary judgment was proper.

{¶15} A court may grant summary judgment only when (1) no genuine issue of material fact exists; (2) the moving party is entitled to judgment as a matter of law; and (3) the evidence can only produce a finding that is contrary to the non-moving party. Mercer v. Halmbacher, 9th Dist., 2015-Ohio-4167, 44 N.E.3d 1011, ¶ 8; Civ.R. 56(C). The initial burden is on the party moving for summary judgment to demonstrate the absence of a genuine issue of material fact as to the essential elements of the case with evidence of the type listed in Civ.R. 56(C). Dresher v. Burt,75 Ohio St.3d 280, 292, 662 N.E.2d 264 (1996). If the moving party meets its burden, the burden shifts to the non-moving party to set forth specific facts to show that there is a genuine issue of material fact. Id.; Civ.R. 56(E). “Trial courts should award summary judgment with caution, being careful to resolve doubts and construe evidence in favor of the nonmoving party.” Welco Industries, Inc. v. Applied Cos., 67 Ohio St.3d 344, 346, 617 N.E.2d 1129 (1993).

{¶16} In this assignment of error, William raises seven separate arguments asserting summary judgment was improper. We will address each argument separately.

1. Statute of Frauds

{¶17} It is undisputed Elizabeth was listed on the mortgage as the borrower and she initialed every page of the mortgage. William was not listed on the mortgage, although he initialed every page of the mortgage. Elizabeth solely signed the mortgage. Additionally, Elizabeth is the sole borrower on the note and she, not William, signed the note.

{¶18} The deeds indicate William was solely listed on the deed when Elizabeth signed this mortgage and note. Furthermore, nothing in Elizabeth’s affidavit stated that at the time she signed the mortgage she was listed on the deed.

{¶19} Given these facts, William asserts Elizabeth did not have the right to mortgage his property and thus, the Bank is not permitted to foreclose on his interest in the property. He asserts any mortgage interest is barred by the statute of frauds. According to him, the trial court incorrectly determined the statute of frauds did not apply.

{¶20} The statute of frauds states, “No action shall be brought * * * upon a contract or sale of lands * * * or interest in or concerning them * * * unless the agreement upon which such action is brought * * * is in writing and signed by the party to be charged therewith or some other person thereunto by him or her lawfully authorized.” R.C. 1335.05.

{¶21} The Ohio Supreme Court has held that a mortgage is a conveyance to which the statute of frauds applies. FirstMerit Bank, N.A. v. Inks, 138 Ohio St.3d 384, 2014-Ohio-789, 7 N.E.3d 1150, quoting Webb’s Admr. v. Roff, 9 Ohio St. 430 (1859),paragraph one of the syllabus.

{¶22} The Bank agrees that typically a mortgage falls within the statute of frauds. But it contends that in this case there was a mutual mistake that removed the case from the statute of frauds.

{¶23} Courts have held that a mutual mistake does remove a case from the statute of frauds. Holt v. Martino, 3d Dist. No. 14-97-43, 1998 WL 126247, (Mar. 19, 1998) (statute of frauds requires the transaction be in writing; however, where both parties to a contract agree the terms within the contract do not actually evince their true intentions, then a mutual mistake could be one explanation for the discrepancy.); Phoenix Concrete, Inc. v. Res.-Creekway, Inc., 100 Ohio App.3d 397, 405, 654 N.E.2d 155 (10th Dist.1995) (“[T]he Statute of Frauds does not preclude reformation of a written agreement which as a result of a mutual mistake fails to reflect the intent of the parties.”); Davenport v. Sovil’s Heirs, 6 Ohio St. 459, 464 (1856) (“mutual mistake of the parties to a contract concerning lands will take the case out of the statute of frauds, as that a part performance will do so”).

{¶24} In Davenport, one party claimed the description in the mortgage did not embrace the land intended to be mortgaged. The mistake was claimed to be mutual. The question before the court was whether the contract could be reformed on the basis of mutual mistake. The Court determined that it could:

It is admitted everywhere that a defendant in equity may allege, and prove by parol, a mistake in a contract sought to be enforced against him; and we are unable to perceive any good reason why a distinction should be made between a plaintiff and defendant in cases of this kind. That it is difficult or impossible to reconcile this doctrine with the letter of the statute for the prevention of frauds and perjuries, may be admitted; but it would be quite as difficult to reconcile with that statute the unquestioned doctrine that a parol contract for the sale of lands, when partly performed, is not within its operation. In both cases we proceed on the ground, that to allow the statute to operate would be to give success and effect to the very evil the statute was designed to prevent. And, so far as a uniform course of judicial determination can settle anything, it would seem to be as well settled, at least in Ohio, that mutual mistake of the parties to a contract concerning lands will take the case out of the statute of frauds, as that a part performance will do so.

Id. at 463-464.

{¶25} The mistake in Davenport not only occurred in the mortgage, but also happened when the property was sold to another party. The Court held the decree of sale was not an obstacle to reforming the mortgage. Id. at 465-466.

{¶26} Davenport demonstrates the statute of frauds does not bar reformation when there is a mutual mistake in a mortgage. William correctly points out the mistake in Davenport did not concern who signed the mortgage, but instead concerned the description of the real property.

{¶27} The question then becomes does that distinction mean the general rule, that a mortgage can be reformed if there is a mutual mistake, no longer applies. This court holds the general rule applies; the issue is proving mutual mistake in order to take the contract outside the statute of frauds. Mutual mistake is similar to the issue of part performance. Part performance removes an oral contract concerning real property from the operation of the statute of frauds. Martin v. Jones, 4th Dist. No. 14CA992, 2015-Ohio-3168, ¶ 47. Even though there is no official signature in an oral contract, the party can prove there was a contract. The same applies in this case.

{¶28} It is possible that the Bank could prove William intended to sign the mortgage since his initials appear on each page of the mortgage. In that case, mutual mistake would apply taking the contract outside of the statute of frauds. But it is likewise possible that William could prove he did not intend to sign the mortgage because, in fact, he did not sign it. In that case, there would be no mutual mistake and the statute of frauds would bar reformation.

{¶29} Thus, it is possible that mutual mistake can be used to reform the mortgage and the statue of frauds will not apply. But, as will be discussed in detail below, a genuine issue of material fact exists as to whether William mistakenly failed to sign the mortgage or whether he intentionally did not sign it.

2. New Claims

{¶30} William argues the trial court should not have considered the Bank’s claims for unjust enrichment and reformation because it did not raise those claims in the complaint. He asserts the Bank raised these claims for the first time in its motion for summary judgment. William asserts he was not put on notice of these claims and never had a chance to file an answer or to conduct discovery regarding these claims. William further argues the complaint did not state any claim against him.

{¶31} In the complaint, William was named as a defendant. The complaint was clearly a foreclosure complaint. The second count of the complaint indicated “defendants,” which included William, “have or claim to have an interest in the premises.” The next paragraph alleged the mortgage with the Bank was the first lien on the premises and the Bank was entitled to foreclose on the property because all conditions precedent had been performed. Therefore, the Bank made a claim against William in the complaint.

{¶32} That being said, William is correct that the words “unjust enrichment” and “reformation” do not appear in the complaint. The words “mutual mistake” also do not appear in the complaint. Therefore, we must determine whether the complaint was required to notify William that the Bank alleged mutual mistake and sought reformation, and if so, whether the complaint complied with that requirement.

{¶33} Ohio is a notice-pleading state. York v. Ohio State Highway Patrol, 60 Ohio St.3d 143, 144, 573 N.E.2d 1063 (1991). Civ.R. 8(A) requires only that a complaint “contain (1) a short and plain statement of the claim showing that the party is entitled to relief, and (2) a demand for judgment for the relief to which the party claims to be entitled.” Civ.R. 8(E) further directs averments contained in a pleading be simple, concise, and direct. “Ohio law does not ordinarily require a plaintiff to plead operative facts with particularity.” Cincinnati v. Beretta U.S.A. Corp., 95 Ohio St.3d 416, 2002-Ohio-2480, 768 N.E.2d 1136, ¶ 29.

{¶34} Other appellate districts have found that as long as the complaint sets forth the proper allegations upon which there is a right to reformation, that remedy may be granted. For instance, the Ninth District has concluded reformation is implicitly pleaded when reformation of the contract is the only means the trial court has to grant the relief requested. Elmar Co. v. Bernacchia, 9th Dist. No. 91CA005153, 1992 WL 82656, (Apr. 22, 1992). As long as the pleadings set forth sufficient operative facts to give the other party fair notice of the nature of the action, the “plaintiff is not required to explicitly state `reformation’ within its complaint before the trial court may grant such relief.” Id. Likewise, the Eleventh District has found that as long as the complaint sets forth the proper allegations upon which there is a right to reformation, the court may grant reformation. Allstate Ins. Co. v. Zampedro, 11th Dist. No. 3247, 1983 WL 6040, (Dec. 30, 1983).

{¶35} Here, the complaint indicated the Bank was seeking foreclosure. It was clear from the complaint and the attachments that only Elizabeth signed the note and mortgage and she was listed as the sole borrower. As mentioned above, the Bank alleged in the complaint that William had an interest in the property. If William was the only party listed on the deed, then unjust enrichment and reformation would be the only means to obtain foreclosure. Thus, under these facts, the Bank implicitly raised claims for unjust enrichment and reformation.

{¶36} Moreover, when the Bank filed its motion for summary judgment, the only means by which it would be entitled to foreclose on the property was under a claim of unjust enrichment and by having the mortgage reformed. Through the summary judgment motion, William had notice of these claims. The Bank points out William could have moved pursuant to Civ.R. 56(F) for additional time to conduct discovery on these newly raised issues. Van Wert v. Akron Metro. Regional Transit Auth., 5th Dist. No. 2014CA00201, 2015-Ohio-3243, ¶ 21 (Civ.R. 56(F) provides the remedy for a party who seeks a continuance on a motion for summary judgment in order to conduct discovery relevant to the motion.). This was an option for him which he did not pursue.

{¶37} In conclusion, the complaint was sufficient to put William on notice of the unjust enrichment and reformation claims. As to the summary judgment motion, William had the opportunity to defend the claims. We find no error with the trial court considering these issues.

3. Standing

{¶38} William claims the Bank lacks standing to bring the foreclosure action for two reasons. First, the Bank did not have any interest in the mortgage in 2004 when the mortgage was executed. Its interest was not acquired until it was assigned the loan in 2012. Second, William claims the Bank does not possess a valid mortgage on the premises.

{¶39} Recently, the Ohio Supreme Court explained standing as “`[a] party’s right to make a legal claim or seek judicial enforcement of a duty or right.'” Wells Fargo Bank, N.A. v. Horn, 142 Ohio St.3d 416, 2015-Ohio-1484, 31 N.E.3d 637, ¶ 8, quoting Black’s Law Dictionary 1625 (10th Ed.2014). A party lacks standing to invoke a court’s jurisdiction unless the party has some real interest in the subject matter of the action. Id., citing State ex rel. Dallman v. Franklin Cty. Court of Common Pleas, 35 Ohio St.2d 176, 179, 298 N.E.2d 515 (1973).

{¶40} In order for the Bank to have standing here to bring its foreclosure action, it must have had an interest in the note or mortgage at the time it filed suit. Federal Home Loan Mortg. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, ¶ 28. The note and mortgage attached to the complaint established it had an interest. Thus, the Bank had standing to bring the foreclosure action.

4. Statute of Limitations

{¶41} William argues the claim for unjust enrichment is barred by the statute of limitations. R.C. 2305.07 provides a six-year statute of limitations for a claim of unjust enrichment. Williams asserts the statute of limitations began to run on September 4, 2004, when the mortgage from Countrywide Home Loans Servicing (the Bank’s predecessor) was used to pay off Elizabeth and William’s previous mortgage on the premises. The Bank asserts the statute of limitations did not begin to run until 2012, when William “asserted an adverse interest in the Property by means of his position in this litigation.”

{¶42} The general rule in Ohio is “a cause of action accrues and the statute of limitations begins to run at the time the wrongful act was committed.” Collins v. Sotka,81 Ohio St.3d 506, 507, 692 N.E.2d 581 (1998). There is an exception to this general rule known as the discovery rule. The discovery rule provides that “a cause of action accrues when the plaintiff discovers, or in the exercise of reasonable care should have discovered, that he or she was injured by the wrongful conduct of the defendant.” Id. The discovery rule, however, has not been extended to unjust enrichment claims. Marok v. Ohio State Univ., 10th Dist. No. 13AP-12, 2014-Ohio-1184, ¶ 25; Palm Beach Co. v. Dun & Bradstreet, Inc., 106 Ohio App.3d 167, 665 N.E.2d 718 (1st Dist.1995).

{¶43} That said, in Palm Beach Co., it was explained, “a cause of action for unjust enrichment accrues on the date that money is retained under circumstances where it would be unjust to do so.” Palm Beach Co. at 175. In that case, the defendant allegedly deceived the plaintiff into buying more of its services than the plaintiff needed. Id. at 169-170. In holding that the claim was barred by the statute of limitations, the court explained:

Although in certain cases the unlawfulness of the retention may not arise until there is a request for a return of the money, in the instant case, if Palm Beach’s allegations are true, it was the receipt of the money that was unlawful, and therefore the cause of action accrued at the latest, as the trial court determined, in 1982 when the last of the alleged overcharges, or false billings or accountings, occurred.

Id. at 175.

{¶44} Appellate courts have applied the Palm Beach reasoning to varying degrees. The Eighth Appellate District reviewed the language of Palm Beach and held the unjust enrichment claim, given the facts before them, was barred. Pomeroy v. Schwartz, 8th Dist. No. 99638, 2013-Ohio-4920, ¶ 43-47. In Pomeroy, an insurance agency brought an action against a commercial client to recover funds advanced to pay non-covered “trail funds.” The trial court determined the last payment, September 2003, of the “trail claims” triggered the statute of limitations, not April 2006, when there was a demand for reimbursement of the “trail funds.” Id. at 45. It explained:

Appellees’ failure to reimburse appellants, if unjust under the circumstances as appellants allege, was unjust from the beginning; when appellants decided to demand the return of the allegedly wrongfully retained benefit is not a significant event for purposes of the statute of limitations. To conclude otherwise would allow a plaintiff to unilaterally control the statutory time.

Id. at ¶ 46.

{¶45} The Ninth Appellate District has also reviewed the Palm Beach decision. Desai v. Franklin, 177 Ohio App.3d 679, 690-93, 2008-Ohio-3957, 895 N.E.2d 875 (9th Dist.), ¶ 17-23. In Desai, Desai and Franklin entered into an employment agreement whereby Desai would join Franklin’s professional corporation. Id. at ¶ 2. The agreement indicated Desai’s compensation would be computed as a percentage of the operating net income. Id. The agreement also provided Desai would be entitled to 45% of the accounts receivable for any termination occurring after July 1, 1981. Id.Desai resigned September 1, 2000. Following his resignation, questions arose as to whether or not Franklin had comported with the terms of the employment agreement. Desai filed suit two years later and asserted, among other claims, a claim for unjust enrichment. The case proceeded to a jury trial. The jury determined Franklin had engaged in unjust enrichment from 1987 until Desai’s departure in 2000 and awarded Desai $301,597.34 in damages for the unjust enrichment claim. Id. at ¶ 8.

{¶46} On appeal, Franklin argued that under the theory of unjust enrichment Desai was entitled to recover only for the injuries he received on the date of the filing of his complaint, January 22, 2002, and the six years preceding that date. Id. at ¶ 13.

{¶47} The appellate court disagreed. Id. at ¶ 23. It discussed the Palm Beach holding and stated the First District focused on the last date the benefit was received and conferred. Id. at ¶ 17. The Ninth Appellate District then explained Palm Beach Co.’s unjust-enrichment claim failed because it had stopped conferring any benefit upon Dun & Bradstreet in 1982, 11 years before it filed its claim. Id. at ¶ 19. It then stated its previous decision regarding when an unjust enrichment claim accrues comports with the Palm Beach decision:

Previously, this court held that an unjust-enrichment claim did not begin to accrue until the point at which the defendant’s retention became unjust. See Chaplain Kieffer Post 1081 v. Wayne Cty. Veterans Assn.(Sept. 21, 1988), 9th Dist. No. 2358, 1988 WL 99188. In Chaplain Kieffer Post 1081, a Veterans of Foreign Wars Post (“post”) placed some of its assets in a trust account under the name of the Wayne County Veterans Association (“association”). The assets were always to be for the benefit of the post. In 1980, the association became a separate organization, but continued to hold the post’s assets. In 1985, new officers of the post asked the association about the assets, but the association claimed that it was entitled to them and that the statute of limitations barred the post from bringing suit to reclaim them. This court held that the post’s unjust-enrichment claim did not accrue until 1985, when the association informed the post that it planned to keep the assets instead of holding them for the post’s benefit. Chaplain Kieffer Post 1081 at *3. Thus, even though the association had possession of the post’s assets prior to 1985, the unjust-enrichment claim did not accrue until the association announced its intent to keep the assets for its own benefit. That announcement made the retention of the post’s benefit unlawful and gave rise to the unjust-enrichment claim. Id. This holding comports with Palm Beach Co.‘s holding that an unjust-enrichment claim accrues, at the latest, when the last unjust retention of the benefit occurs. See Palm Beach Co., 106 Ohio App.3d at 175, 665 N.E.2d 718.

Id. at ¶ 20.

{¶48} The Desai decision, based on the Palm Beach decision, concluded a claim does not accrue until the last point in time the plaintiff conferred and a defendant unjustly received a benefit. Id. at ¶ 22. In Desai the court determined that since Desai stopped working for Diagnostic Imaging in 2000, that was when he effectively stopped being a benefit to Franklin. Thus, the 2002 claim was not barred by the statute of limitations and furthermore, damages could extend back until 1987 since the jury found Franklin was unjustly enriched from 1987 until 2000.

{¶49} In this case, there are three potential accrual dates. The first one is the date of the mortgage signed by Elizabeth, September 4, 2004. William insists that is the correct accrual date. The proceeds of the September 4, 2004 mortgage were used to pay off a previous mortgage signed by William and Elizabeth. He insists that is the only date the benefit was conferred and retained.

{¶50} This reasoning, however, fails to acknowledge payments made on the September 4, 2004 note secured by the mortgage. It may be unjust to hold the accrual date as September 4, 2004, because it would allow William to unilaterally control the statutory time. See Pomeroy, 2013-Ohio-4920 at ¶ 46. William could ensure the mortgage was paid for six years and then stop payment but retain the benefit of having his previous mortgage paid off and getting to keep his house free and clear of debt.

{¶51} The above analysis demonstrates the second potential date of the accrual — date of default or failure to pay on the note. The benefit was being conferred and retained as long as payments on the note were made. Conference and retention of the benefit would not cease until Elizabeth was in default on the note. Thus, the cause of action may not accrue until payments were no longer made on the note. The trial court found the note went into default in February 2012.

{¶52} The third potential accrual date is the date the foreclosure action was filed. The Bank asserts this is when the statute of limitations began to run because this is when William asserted his claim that the Bank could not foreclose on his interest in the property.

{¶53} Considering all potential accrual dates, we agree with the Bank’s position. The statute of limitations did not begin to run until the claim was filed in 2012. Therefore, since the unjust enrichment claim did not accrue until 2012, the claim is not barred by the statute of limitations.

5. Parol Evidence Rule

{¶54} William argues the parol evidence rule prevents the Bank from using Elizabeth’s affidavit to add additional terms to the mortgage, specifically, to use her testimony to assert it was the intention of the Bank, William, and Elizabeth that William was to sign the mortgage. The Bank asserts parol evidence may be introduced to show a mistake where the written contract fails to express the actual agreement. It contends the Supreme Court has allowed parol evidence to be introduced to support reformation of a mortgage.

{¶55} Elizabeth’s affidavit was attached to the Bank’s summary judgment motion. In her affidavit she averred the loan was taken with William’s full knowledge and consent. (Elizabeth Aff. ¶ 8). She further avowed at the time the mortgage was executed, both she and William intended the mortgage would encumber the entire interest in the property and it was a mistake when William did not sign the mortgage. (Elizabeth Aff. ¶ 10). She also stated she and William signed the Bank’s HUD Settlement Statement at closing. (Elizabeth Aff. ¶ 12).

{¶56} The parol evidence rule provides that when parties intend a writing to be a final embodiment of their agreement, it cannot be modified by evidence of earlier or contemporaneous agreements that might add to, vary, or contradict the writing. Bellman v. Am. Internatl. Group, 113 Ohio St.3d 323, 2007-Ohio-2071, 865 N.E.2d 853, ¶ 7, citing Black’s Law Dictionary (8th Ed.2004) 1149. The parol evidence rule is meant to prevent a party from introducing extrinsic evidence of negotiations that took place before or while the agreement was being reduced to writing. Id., citing Black’s Law Dictionary at 1149. Furthermore, the rule assumes the writing reflects the parties’ minds at a point of maximum resolution. Id., citing Black’s Law Dictionary at 1150. Therefore, the rule provides that duties and restrictions that do not appear in the writing were not intended by the parties to survive. Id., citing Black’s Law Dictionary at 1150.

{¶57} A court can only go behind the face of an unambiguous contract where there is mutual mistake, circumventing the parol evidence rule, so long as the court is persuaded by the clearest kind of evidence that a mistake has been made by both parties. D.F.D., Inc. v. Frick, 2d Dist. No. 10769, 1988 WL 59394, (June 2, 1988), citing 13 Williston on Contracts 213, Section 1552, (1972).

{¶58} Here, there is a claim of mutual mistake. Therefore, if the Bank can show mutual mistake then the parol evidence rule will not bar outside evidence of the parties’ intentions. But if mutual mistake does not exist, the parol evidence rule will bar any evidence outside of the contract itself.

6. Reformation Unprecedented

{¶59} William argues that there is no evidence of mutual mistake between the Bank and him.

{¶60} A person seeking reformation of a written instrument must prove by clear and convincing evidence that the mistake regarding the instrument was mutual. Amsbary v. Brumfield, 177 Ohio App.3d 121, 128, 2008-Ohio-3183, 894 N.E.2d 71, ¶13 (4th Dist.), quoting Patton v. Ditmyer, 4th Dist. Nos. 05CA12, 05CA21, and 05CA22, 2006-Ohio-7107, ¶ 28. Clear and convincing evidence is “that measure or degree of proof which is more than a mere `preponderance of the evidence,’ but not to the extent of such certainty as is required `beyond a reasonable doubt’ in criminal cases, and which will produce in the mind of the trier of facts a firm belief or conviction as to the facts sought to be established.” State ex rel. Husted v. Brunner, 123 Ohio St.3d 288, 2009-Ohio-5327, 915 N.E.2d 1215, ¶ 18, quoting Cross v. Ledford, 161 Ohio St. 469, 120 N.E.2d 118 (1954), paragraph three of the syllabus.

{¶61} The record before us discloses a portion of the Bank’s mortgage was used to pay off a 2003 mortgage to which both Elizabeth and William were obligated. The other portion of that 2003 mortgage was paid off with a loan for $36,500.00 from Fifth Third Bank, which was executed the same day the Bank’s mortgage was executed. The Fifth Third loan mortgaged the property, listed the borrowers as Elizabeth and William, and was signed by Elizabeth and William. Attached to William’s motion in opposition to summary judgment was a document from the Bank’s predecessor that lists the conditions of the loan to Elizabeth as of September 1, 2004. One condition was payoffs must be paid at closing. Another condition was the loan for $36,500 from Fifth Third must close. Another condition was “Spouse to sign TIL, RTC & MTG.” That document is dated three days prior to the execution of the loan. The first two conditions were met.[1] The spouse’s signature condition was not met.

{¶62} In his affidavit, William averred that he never consented to the loan and mortgage. (William Aff. ¶ 4). William further averred that it was not by his mistake that he did not sign the mortgage. (William Aff. ¶ 5).

{¶63} Generally, self-serving affidavits, without corroboration, are not sufficient to demonstrate material issues of fact. Bangor v. Amato, 7th Dist. No. 14 CO 9, 2014-Ohio-5503, ¶ 32. But in this case, William’s affidavit is corroborated by the evidence that not only did he not sign the mortgage, he also did not sign the HUD Settlement Statement. (Elizabeth Aff. Ex. C). Only Elizabeth’s signature is present on the HUD Settlement Statement despite her averment in her affidavit that she and William both signed the HUD Settlement Statement at the closing of the loan. (Elizabeth Aff. ¶ 12). The facts that not only did William not sign the mortgage but also he did not sign the HUD Settlement Statement, when construed together and in the light most favorable to William create a genuine issue of material fact as to whether the lack of William’s signature on the mortgage was intentional on William’s part or was simply a mistake.

{¶64} Moreover, the fact that William initialed pages of the mortgage documents suggest only that he read these pages. Nothing in the mortgage indicates that by initialling the pages the party is agreeing to the terms of the mortgage. This statement is reserved for the signatory page at the end of the mortgage, which states, “BY SIGNING BELOW, Borrower accepts and agrees to the terms and covenants contained in this Security Instrument an in any Rider executed by Borrower and recorded with it.” (Elizabeth Aff. Ex. B). And on the notary page at the end of the mortgage, the notary public stated that the document was acknowledged before him by Elizabeth. (Elizabeth Aff. Ex. B). The notary public does not mention William at all. (Elizabeth Aff. Ex. B).

{¶65} Based on the above, a genuine issue of material fact exists as to whether William’s missing signature on the mortgage was accidental or intentional. This genuine issue of material fact precludes summary judgment.

7. Material Issues of Fact

{¶66} William asserts the only evidence for or against summary judgment are his and Elizabeth’s affidavits. As stated above, Elizabeth’s affidavit indicated it was a mistake that William did not sign the mortgage. (Elizabeth Aff. ¶ 10). William’s affidavit indicated it was not a mistake that he did not sign the mortgage. (William Aff. ¶ 5).

{¶67} William contends the statements in Elizabeth’s affidavit are unreliable, and therefore, lack credibility. He states, at the minimum, the contradictory affidavits create a genuine issue of material fact.

{¶68} William is correct that Elizabeth’s affidavit does contain an inconsistency with the document attached to the affidavit. As set forth above, Elizabeth avowed in the affidavit William signed the HUD Settlement Statement at closing. (Elizabeth Aff. ¶ 12). The HUD Settlement Statement was attached to the summary judgment motion and does not contain William’s signature.

{¶69} The Bank asserts, despite the fact William states it was not his intent to sign the mortgage, there are not any genuine issues of material fact. It states the intent of Elizabeth and the Bank was the only relevant intent to determine if William was to sign the mortgage. That may be true if Elizabeth or the Bank were attempting to have the contract deemed void. However, the Bank is attempting to reform the document to encumber William’s interest in the property. It wants to have him bound by the contract. Therefore, his intent is relevant. If he never intended to be a party to the contract, he cannot be made to be a party to the contract. In simple terms, if two parties to a contract intended a third party to be a party to the contract, but the third party had no intent to be a party to the contract, the two parties cannot reform the contract to include the third party. Therefore, the Bank’s assertion that William’s intent is irrelevant lacks merit.

{¶70} As stated above, there is conflicting evidence as to whether a mutual mistake exists in this case. On July 29, 2003, William and Elizabeth borrowed $229,500 from Accredited Home Lenders. That loan was secured by a mortgage to the property located at 10450 New Buffalo Road, Canfield, Ohio. The mortgage was signed by both William and Elizabeth. Almost one year later, Elizabeth borrowed approximately $207,000 from the Bank and Elizabeth and William borrowed approximately $36,000 from Fifth Third Bank. Those two loans were used to pay off the Accredited Home Lenders loan. The Bank’s loan and the Fifth Third loan closed on the same day. William signed the mortgage with Fifth Third Bank. Significantly, however, William did not sign the mortgage with the Bank. Not only did he not sign the mortgage, he also did not sign the HUD Settlement Statement. Moreover, the notary public stated on the notary page at the end of the mortgage that the mortgage was acknowledged before him by Elizabeth. The notary makes no mention of William acknowledging the mortgage.

{¶71} Considering all of the evidence in the light most favorable to William, the non-moving party, we conclude a genuine issue of material fact exists as to whether William’s missing signature on the mortgage was accidental or intentional.

Thus, the trial court erred in granting summary judgment.

{¶72} Accordingly, William’s first assignment of error has merit and is sustained because the trial court erroneously granted summary judgment.

{¶73} William’s second assignment of error states:

THE TRIAL COURT ERRED IN STRIKING DARKADAKIS’ MOTION FOR SUMMARY JUDGMENT.

{¶74} The trial court granted summary judgment to the Bank on June 11, 2014. That order was not a final appealable order because it did not include a final decree of foreclosure. Thus, we remanded the matter so the trial court could issue a final appealable order. William filed his motion for summary judgment on February 5, 2015. The trial court struck the motion on April 21, 2015. A final decree of foreclosure was issued the same day.

{¶75} William asserts the trial court abused its discretion in striking his motion without considering it. He asserts the motion was timely filed, a statute of limitations defense on reformation arose in the interim, the filing of the motion did not exceed our limited remand, and the Bank was not prejudiced.

{¶76} An appellate court will not overturn a trial court’s decision to grant a motion to strike absent an abuse of discretion. Embry v. Bur. of Workers’ Comp., 10th Dist. No. 04AP-1374, 2005-Ohio-7021, ¶ 12. Abuse of discretion connotes more than an error of law or judgment; it implies that the trial court’s attitude is unreasonable, arbitrary, or unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140 (1983).

{¶77} Following our December 15, 2014 order remanding the case for the parties to obtain a final appealable order, the magistrate issued an order on January 6, 2015. William’s first argument is that the magistrate’s January 6, 2015 order permitted the parties to file any pleadings in this case. According to the Bank, the magistrate’s order directed the parties to file pleadings to “prosecute the case.” It claims the motion for summary judgment was not filed to prosecute the case, but rather was seeking to re-argue issues already decided by the trial court.

{¶78} The Bank’s assessment of the issue is correct. The trial court had already granted summary judgment to the Bank on its reformation and unjust enrichment claims. William’s motion for summary judgment re-raised arguments already asserted in his motion in opposition to the Bank’s motion for summary judgment. The only new argument was a statute of limitations argument concerning the reformation claim, which will be discussed below. Thus, William’s motion was not being used to prosecute the case.

{¶79} William’s second argument is the ten-year statute of limitation period for the reformation claim expired on September 1, 2014, while the appeal was pending. According to William, the summary judgment motion was necessary to assert this new defense.

{¶80} “R.C. 2305.14 provides that actions not specifically limited in any provision of the Code must be brought within ten years after the cause accrued. A cause of action for reformation of a written instrument based upon mistake accrues upon the execution of the instrument.” Bonham v. Hamilton, 12th Dist. No. CA2006-02-030, 2007-Ohio-349, ¶ 31. The Bank filed its claim for reformation prior to September 4, 2014. Thus, the statute of limitations had not expired. The claim does not have to be resolved within the statute of limitations period, rather it must be filed within the statute of limitations. R.C. 2305.14 (“An action for relief * * * shall be brought within ten years after the cause thereof accrued.”). Therefore, William’s argument on this point fails.

{¶81} Next, William argues his motion for summary judgment did not exceed our limited remand.

{¶82} When we remanded the matter on December 15, 2014, our judgment entry discussed what is required for a foreclosure decree to be final. We stated, “the trial court did not enter a monetary award on the award of summary judgment, nor did it resolve the issue of liens.” We also explained that there are two appealable judgments in foreclosure actions — the order of foreclosure and sale, and the confirmation of sale. In this case, no decree of foreclosure was issued when the trial court granted summary judgment to the Bank. Thus, we issued a “limited remand” for 60 days to permit William to obtain a final appealable order.

{¶83} In the June 4, 2015 judgment entry concerning the Bank’s argument that we should not address the trial court’s decision to strike William’s motion for summary judgment we stated:

On December 15, 2014 this Court issued a limited remand to allow the trial court to enter final judgment regarding the foreclosure proceedings, as no decree in foreclosure had yet been issued. The limited remand was for a very specific purpose. In short, there did not exist a final appealable order at the time the Notice of Appeal was filed.

{¶84} We made it clear that the remand was a limited remand. We were not remanding to permit William to file his own summary judgment motion. William had the opportunity to file a summary judgment motion if he wanted at an earlier time. But he did not. The trial court was correct in determining our remand was limited. The trial court did not abuse its discretion when it struck William’s motion for summary judgment.

{¶85} William’s last argument is the Bank was not prejudiced by his motion for summary judgment. Lack of prejudice to a party does not mean the trial court abused its discretion in striking the motion. As stated above, our remand was a limited remand for the trial court to issue a final appealable order, specifically a foreclosure decree.

{¶86} Accordingly, William’s second assignment of error is without merit and is overruled.

{¶87} William’s third assignment of error states:

THE TRIAL COURT ERRED IN NOT GRANTING DARKADAKIS’ MOTION FOR SUMMARY JUDGMENT.

{¶88} William argues the trial court erred in not granting his motion for summary judgment. But the trial court struck his summary judgment motion. We have already found the trial court did not abuse its discretion in striking William’s summary judgment motion.

{¶89} Therefore, William’s third assignment of error is without merit and is overruled.

{¶90} William’s fourth assignment of error states:

{¶91} THE TRIAL COURT ERRED IN OVERRULING DARKADAKIS’ MOTION TO DISMISS.

{¶92} As stated above, William argues the complaint was insufficient and failed to state a claim against him. He contends the trial court erred when it failed to grant his motion to dismiss the complaint for failure to state a claim.

{¶93} The Bank asserts William did not file a motion to dismiss. Therefore, the trial court did not err in failing to grant a nonexistent motion.

{¶94} Technically, the Bank is correct. William did not file a separate motion to dismiss. However, in his motion in opposition to the Bank’s motion for summary judgment, he stated:

Bank has raised unjust enrichment but failed to plead same in its complaint. William’s answer would have asserted an affirmative. [sic] This unjust enrichment claim at his [sic] late date constitute a failure to state a claim upon which relief may be granted pursuant to Civ.R. 12(B)(6). * * *

As the Bank’s motion for summary judgment is the first presentation of the mutual mistake and unjust enrichment claims and this memorandum in opposition is the first opportunity to raise such defense, it is believed that these defenses under Civ.R. 12 are timely being raised and ought to be considered by the court before it determines the appropriateness of the motion for summary judgment.

Wherefore, Defendant William Darkadakis, pursuant to facts in dispute and defenses now raised to new claims being made, respectfully requests that the Bank’s motion for summary judgment be denied and, if necessary that the Bank’s complaint be amended to include well-pleaded claims and the joinder of a necessary party.

{¶95} What is notably missing is a request to dismiss the complaint for failure to state a claim.

{¶96} Therefore, William’s fourth assignment of error is without merit and is overruled.

{¶97} William’s fifth assignment of error states:

THE TRIAL COURT ERRED IN ORDERING THE FORECLOSURE ON DARKADAKIS’ HOME.

{¶98} Because we have already determined that the trial court erred in granting summary judgment in this case, the trial court’s order of foreclosure will be reversed.

{¶99} Accordingly, William’s fifth assignment of error is moot.

{¶100} William’s sixth assignment of error states:

THE TRIAL COURT ERRED IN DENYING DARKADAKIS’ MOTION TO SUPPLEMENT THE RECORD WITH THE BANK’S PROPOSED FINDINGS OF FACT AND CONCLUSION OF LAW.

{¶101} While the appeal was pending, William filed a motion with this court to supplement the record. We held the magistrate and trial court were in a superior position to determine if the record should be supplemented. The trial court denied the motion.

{¶102} We have already determined that the trial court erred in granting summary judgment in this case.

{¶103} Accordingly, William’s sixth assignment of error is moot.

{¶104} For the reasons stated above, the trial court’s judgment is hereby reversed. The matter is remanded to the trial court for further proceedings pursuant to law and consistent with this opinion.

Robb, J., dissents with attached dissenting opinion.

Yarbrough, J., concurs.

Robb, J., dissenting opinion.

{¶105} I respectfully dissent from the decision reached by my colleagues. In reversing the trial court’s grant of summary judgment for the Bank, the majority holds, “a genuine issue of material fact exists as to whether William mistakenly failed to sign the mortgage or whether he intentionally did not sign it.” Opinion ¶ 29. I disagree with this holding and would affirm the trial court’s grant of summary judgment for the Bank.

{¶106} The majority’s holding suggests if William intentionally did not sign the loan then reformation would not be available. I find fault with that suggestion. If William intended to encumber his property, but intentionally did not sign the document in an attempt to take advantage of the situation, then mistake still could be found and reformation could still be available. When a unilateral mistake occurs “`due to a drafting error by one party and the other party knew of the error and took advantage of it, the trial court may reform the contract. * * * Reformation is appropriate if one party believes a contract correctly integrates the agreement and the other party is aware that it does not, even though the mistake was not mutual.'” 425 Beecher, L.L.C. v. Unizan Bank, Natl. Assn., 186 Ohio App.3d 214, 2010-Ohio-412, 927 N.E.2d 46, ¶ 44 (10th Dist.), quoting Galehouse Constr. Co., Inc. v. Winkler, 128 Ohio App.3d 300, 303, 714 N.E.2d 954 (9th Dist.1998).

{¶107} Consequently, I believe the issue before this court is not whether there is a genuine issue of material fact as to whether William mistakenly failed to sign the document or whether he intentionally failed to sign it. Rather, the issue is whether there is a genuine issue of material fact as to whether there was a mutual mistake in the execution of the mortgage. Specifically, is there a genuine issue of material fact as to whether William intended to encumber the property?

{¶108} Civ.R. 56 provides summary judgment shall be granted if “there is no genuine issue as to any material fact” and the moving party is “entitled to judgment as a matter of law.” Civ.R. 56(C). That said, the rule further provides:

A summary judgment shall not be rendered unless it appears from the 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, that party being entitled to have the evidence or stipulation construed most strongly in the party’s favor.

Civ.R. 56(C).

{¶109} Given the facts of this case, in my opinion, there is no genuine issue of material fact because the only reasonable conclusion the jury could reach is that William intended to encumber the property.

{¶110} The United States Supreme Court has explained:

If the defendant in a run-of-the-mill civil case moves for summary judgment or for a directed verdict based on the lack of proof of a material fact, the judge must ask himself not whether he thinks the evidence unmistakably favors one side or the other but whether a fair-minded jury could return a verdict for the plaintiff on the evidence presented. The mere existence of a scintilla of evidence in support of the plaintiff’s position will be insufficient; there must be evidence on which the jury could reasonably find for the plaintiff. The judge’s inquiry, therefore, unavoidably asks whether reasonable jurors could find by a preponderance of the evidence that the plaintiff is entitled to a verdict— “whether there is [evidence] upon which a jury can properly proceed to find a verdict for the party producing it, upon whom the onus of proof is imposed.” Munson, supra, 14 Wall., at 448.

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505 (1986).

{¶111} Here, the undisputed facts are William and Elizabeth, a married couple, borrowed $229,500 from Accredited Home Lenders on July 29, 2003, which was secured by a mortgage on the property located at 10450 New Buffalo Road, Canfield, Ohio. Both William and Elizabeth signed the mortgage. That loan was paid off one year later by two loans; Elizabeth borrowed approximately $207,000 from the Bank, and Elizabeth and William borrowed approximately $36,000 from Fifth Third Bank. Those two loans closed on September 2, 2004 with William present at both closings.[2] William signed the mortgage with Fifth Third Bank; however, he only initialed the mortgage with the Bank. From 2004 until the note went into default in February 2012, payments were made. During that time William and Elizabeth were married and resided in the residence located at 10450 New Buffalo Road, Canfield, Ohio.

{¶112} William’s initials on the bottom of every page, except the signature page of the Bank’s mortgage, are a confirmation he read the document. When that confirmation is taken together with the facts that the loan was used to pay off his 2003 mortgage with Accredited Home Lenders and payments were made on the mortgage, a reasonable person could only conclude that William knew his property was to be encumbered and intended to encumber his property. There is no evidence William protested the mortgage with the Bank; instead, he used the loan to pay off his obligation to Accredited Home Lenders. Given those facts, a reasonable trier of fact could only conclude it was a mistake when William failed to sign the mortgage and reformation is available.

{¶113} To conclude otherwise unjustly enriches William. I agree with the majority’s conclusion that unjust enrichment was properly pled. The elements of unjust enrichment are “(1) a benefit conferred by a plaintiff upon a defendant; (2) knowledge by the defendant of the benefit; and (3) retention of the benefit by the defendant under circumstances where it would be unjust to do so without payment (`unjust enrichment’).” Hambleton v. R.G. Barry Corp., 12 Ohio St.3d 179, 183, 465 N.E.2d 1298 (1984). There are no disputes as to these elements. William’s loan with Accredited Home Lenders was paid off. William knew the loan was paid off and he knew of the loan with the Bank. It is unjust for William to retain the benefit of having his loan paid off but not pay the Bank. In essence, if he does not have to pay the Bank, then he will receive a house for free.

{¶114} For those reasons, even when viewing the evidence in a light most favorable to William, a reasonable trier of fact could only conclude that it was William’s intent to encumber the property. Any conclusion to the contrary is unreasonable and would result in William being unjustly enriched; he would receive the house free and clear of the mortgage even though the note undisputedly paid off William’s previous mortgage on the property. Thus, I would affirm the trial court’s grant of summary judgment for the Bank.

[1] This document does not meet the requirements of Civ.R. 56 to qualify as proper summary judgment evidence. However, no one objects to it.

[2] Despite assertions at oral argument that William was not present at the closing of the Bank’s mortgage, the record does not support such a position. Elizabeth averred in her affidavit that William was present at the mortgage closing. William’s affidavit does not deny that averment or state he was not present at the mortgage closing.

 

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FHFA Announces Successful Implementation of Release 1 of the Common Securitization Platform

FHFA Announces Successful Implementation of Release 1 of the Common Securitization Platform

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today announced that Release 1 of the Common Securitization Platform (CSP) was successfully implemented on November 21.  This means that Freddie Mac is now using the CSP for Data Acceptance, Issuance Support, and Bond Administration activities related to current single-class, fixed-rate, mortgage-backed securities.

The implementation of Release 1 demonstrates that the system, operations, and controls of the CSP and Common Securitization Solutions (CSS), a joint venture owned by Fannie Mae and Freddie Mac (the Enterprises), are functional.

“The successful implementation of Release 1  is a significant milestone toward the ultimate goal of a common securitization platform and a single security,” said FHFA Director Melvin L. Watt.

Based on lessons learned from the successful implementation of Release 1, the Enterprises and CSS continue to review and make plans to announce the timeframe for Release 2, which involves the issuance by Freddie Mac and Fannie Mae of a common, single mortgage-backed security, to be called the Uniform Mortgage-Backed Security (UMBS).  FHFA expects to announce a timeframe for implementation of Release 2 in the first quarter of next year.  Release 2 will add to the functionality of Release 1 including commingling of Enterprise UMBS, multi-class securities and UMBS disclosures.

“FHFA has developed a timeline of key achievements to date and will update the timeline as milestones are reached.  We remain committed to building the CSP in a transparent manner,” Watt said.

###

The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks. These government-sponsored enterprises provide more than $5.8 trillion in funding for the U.S. mortgage markets and financial institutions. Additional information is available at www.FHFA.gov, on Twitter @FHFA,YouTube and LinkedIn.
Contacts:

Media: Corinne Russell (202) 649-3032 / Stefanie Johnson (202) 649-3030
Consumers: Consumer Communications or (202) 649-3811

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Governor Cuomo Announces New Actions to Assist Homeowners Facing Foreclosure and Hold Banks and Mortgage Servicers Accountable For Maintaining “Zombie Properties”

Governor Cuomo Announces New Actions to Assist Homeowners Facing Foreclosure and Hold Banks and Mortgage Servicers Accountable For Maintaining “Zombie Properties”

Consumer Bill Of Rights and Final Regulation and Are Final Pieces Of Sweeping Legislation Signed By Governor Cuomo to Assist Homeowners Facing Foreclosure

Actions Combat Blight Created By Vacant and Abandoned Properties Across New York State

Governor Andrew M. Cuomo today announced the Department of Financial Services has published a Consumer Bill of Rights for New Yorkers facing foreclosure. Additionally, DFS has also finalized a regulation protecting communities from the blight of “zombie properties” by requiring banks and mortgage servicers to report and maintain vacant and abandoned properties.

Both actions follow legislation the Governor signed in June that curbs the threat “zombie properties” pose to communities by expediting foreclosure proceedings, improving the efficiency and integrity of the mandatory settlement conferences, and obligating banks and mortgage servicers to secure, protect and maintain vacant and abandoned properties before and during foreclosure proceedings.

“These reforms help ensure New Yorkers at risk of foreclosure know their rights, that banks and mortgage servicers are held to their obligations, and that neighborhoods across the state are protected from the blight of zombie properties, which threaten property values, as well as public safety,” Governor Cuomo said. “These steps will help protect the quality of life in our communities and preserve the American Dream in New York.”

Superintendent of Financial Services Maria T. Vullo said, “DFS is proud to put this vital legislation, signed by Governor Cuomo, into action with this final regulation and new Consumer Bill of Rights. Homeowners will now be armed with the information they need to better navigate the foreclosure process and entire communities will be provided assistance and protection with this final regulation in place.”

DFS is required to publish a Consumer Bill of Rights, provided below, no later than 60 days after the new law takes effect. The new law also requires the court overseeing a foreclosure proceeding to provide homeowners a copy of the Consumer Bill of Rights at the initial mandatory settlement conference.

Under the law, bank and mortgage servicers must complete an inspection of a property subject to delinquency within 90 days and must secure and maintain the property where the bank or servicer has a reasonable basis to believe that the property is vacant and abandoned. Banks and mortgage servicers are required to report all such vacant and abandoned properties to DFS and submit quarterly reports detailing their efforts to secure and maintain the properties and the status of any foreclosure proceedings. If DFS determines that a property that has been deemed vacant and abandoned is not being properly maintained by the relevant bank or mortgage servicer, the Superintendent will exercise her authority to hold the bank or mortgage servicer accountable. Violations are subject to a civil penalty of $500 per day per property.

The regulation is part of several provisions that will help address the scope of unoccupied and ill-maintained properties, which based on voluntary reporting is estimated to be over 6,000. Under the new law, reporting by banks and mortgage servicers is now mandatory, and the number of abandoned homes is anticipated to be even higher. The law also requires the creation of a zombie properties hotline to allow New Yorkers to report vacant or abandoned properties. New Yorkers can contact the Department of Financial Services hotline at (800) 342-3736 or online at www.dfs.ny.gov to report vacant or abandoned properties.

A copy of the Consumer Bill of Rights is Available here and below:

Residential Foreclosure Actions Consumer Bill of Rights

This Consumer Bill of Rights provides guidance to homeowners facing foreclosure in New York. A foreclosure is a lawsuit, and homeowners should seek assistance from an attorney or housing counselor in exploring potential legal defenses to the suit. Homeowners should also know their general rights and obligations highlighted below.

Throughout the Foreclosure Process

You have the right to stay in your home and the duty to maintain your property unless and until a court orders you to vacate. If you abandon your home, the plaintiff (bank or mortgage servicer) may be able to foreclose on your property through an expedited process in court. To prevent this outcome, stay in your home and carefully review and respond to documents you receive from the plaintiff or the court in your foreclosure case. A failure to respond or appear in court when required to do so could make it easier for the plaintiff to show that your property is vacant and abandoned, which could put you at risk of an expedited foreclosure.

You have a right to be represented by an attorneyandmay be eligible for free legal or housing counseling services. For free legal services available in your area, visit “Consumers, Mortgage and Foreclosure” on the New York State Department of Financial Services website at www.dfs.ny.gov.

You have a right to be free from harassment or foreclosure scams. Strongly consider consulting with an attorney or housing counselor, if available, before signing any papers. If you are the target of harassment or fraud, contact the New York State Department of Financial Services either online or by calling the Consumer Hotline at (800) 342-3736.

You have a right to avoid foreclosure if you repay your loan in full at any time prior to the sale of your home, or if you negotiate a settlement with the plaintiff.

Before a Foreclosure Action Begins in Court

You have a right to be notified at least 90 days before a foreclosure suitis filed informing you that you are in default and at risk of foreclosure.

You have the right to explore “loss mitigation” options that may allow you to keep your home and avoid litigation. The bank or mortgage servicer is required to help you understand your loss mitigation options.

If you have submitted a completed loss mitigation application, your bank or mortgage servicer must finish its review of your application before proceeding with the foreclosure suit.

Once a Foreclosure Action Begins

You have the right to receive a copy of the legal papers in the foreclosure lawsuit when it begins. This is known as “service” of the Summons and Complaint.

You must respond to the Summons and Complaint with an “Answer” within 20 days after you have been personally served, and within 30 days if served on you by other means. The Answer is your opportunity to state your defenses. You should consult with an attorney or housing counselor for help in this process.

You have a right to participate in all court proceedings related to your case, including the mandatory settlement conference, which is required by New York law. For information about the mandatory settlement conference, visit the “Mandatory Settlement Conference” section of the New York State Department of Financial Services website located at www.dfs.ny.gov.

You have an obligation to appear at all scheduled court appearances. If you fail to appear, you risk losing important rights, which could lead to the loss of the case and your home.

You have a right to request court permission to proceed without paying court costs.

At the Mandatory Settlement Conference

You have a right to an explanation of the nature of the foreclosure action against you.

Both parties have an obligation to bring all necessary documents to the settlement conference. For a general list of required documents, visit the “Mandatory Settlement Conference” section of the New York State Department of Financial Services website located at www.dfs.ny.gov.
Both parties must negotiate in “good faith”, which means honestly and fairly. If you fail to do so, you may lose the opportunity to pursue a court-supervised settlement. If the bank or mortgage servicer fails to do so, the court may impose similarly significant penalties. Negotiating in good faith does not require either party to settle.

If you previously failed to submit an Answer, you will be given an extra 30 days to do so at the settlement conference.

After Settlement Agreement or Fully Executed Loss Mitigation Agreement

Within 90 days of finalizing a settlement, the lis pendens designation on your property, which warns people that title to your property is in dispute, must be lifted.

You may be responsible for additional taxes if you reach a settlement that includes debt forgiveness. Seek advice from a tax professional about any resulting tax consequences.

After Judgment of Foreclosure & Sale

Upon a judgment of foreclosure and sale, the new owner can seek to evict you from the property.

If the home is resold for more than what you owe, you have a right to file an application with the court for the surplus funds, subject to certain deadlines. It is important to seek help from a legal service provider if you believe you are owed a surplus.

If the home is sold for less than what you owe, the lender may file an application for a judgment against you for the difference, known as a deficiency judgment. You may have the right to contest the amount of any deficiency judgment, including interest and penalties.

Contact the Governor’s Press Office
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Reuters Exclusive: U.S. regulator set to fail Wells Fargo on community lending test – sources

Reuters Exclusive: U.S. regulator set to fail Wells Fargo on community lending test – sources

Reuters-

A U.S. bank regulator is ready to fail Wells Fargo on a national scorecard for community lending, sources familiar with the decision said on Wednesday, in a move that could limit near-term expansion for the bank.

Wells Fargo is due to be deemed a bank that “needs to improve” under the Community Reinvestment Act (CRA), a law meant to promote lending to poor neighborhoods.

The move is a two-notch downgrade from the “outstanding” tag Wells Fargo has held since 2008 and the change would give regulators a greater say on day-to-day matters like whether they may open new branches.

[REUTERS]

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Taxpayers Have Now Made A $63 Billion Profit From Fannie Mae, Freddie Mac Bailouts

Taxpayers Have Now Made A $63 Billion Profit From Fannie Mae, Freddie Mac Bailouts

Benzinga-

Shares of Federal National Mortgage Assctn Fnni Me FNMA 6.67%and Federal Home Loan Mortgage Corp FMCC 7.15% have been all over the map in the past week following comments from newly-appointed Treasury Secretary Steven Mnuchin.

When asked about Fannie Mae and Freddie Mac, Mnuchin said the Trump administration has “got to get them out of government control.”

Fannie and Freddie were placed under government conservatorship when they required taxpayer $185 billion bailouts during the financial crisis.

[BENZINGA]

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FUCHS v. KE KAILANI PARTNERS, LLC – PETITION FOR WRIT OF CERTIORARI | This Petition could result in American homeowners facing foreclosure saving trillions of dollars in equity by policing deficiency judgments as is now being done only in half of the states

FUCHS v. KE KAILANI PARTNERS, LLC – PETITION FOR WRIT OF CERTIORARI | This Petition could result in American homeowners facing foreclosure saving trillions of dollars in equity by policing deficiency judgments as is now being done only in half of the states

In The
Supreme Court of the United States

MICHAEL J. FUCHS and
KE KAILANI DEVELOPMENT LLC,
Petitioners,
V.
KE KAILANI PARTNERS, LLC,
Respondent.

On Petition for a Writ of Certiorari to the Hawaii Supreme
Court, the Hawaii Intermediate Court of Appeals, and the
First Circuit Court of the State of Hawaii
a_
PETITION FOR WRIT OF CERTIORARI
Gary Victor Dubin
Counsel of Record
FREDERICK J. ARENSMEYER
Dunrin Law Offices
65 Merchant Street, Suite 3100
Honolulu, Hawaii 96813
Telephone: (808) 537-2300
Facsimile: (808) 523-7733
E -Mail: gdubin@dubinlaw.net
Attorneys for Petitioners

QUESTIONS PRESENTED

1. Resolving the conflict in the decisions, equally divided, among state courts, and between state and federal courts, concerning one of the most fundamental due process issues in constitutional law, the requirement of a neutral and impartial decision maker: Is a presiding state judge, discovered to have an undisclosed stock ownership interest in an adverse party, refusing nevertheless to recuse himself, in violation of judicial ethics and a disqualified jurist, based upon an objective standard of the appearance of partiality, and his or her decisions required to be set aside?

2. Resolving the conflict in the decisions, equally divided, among state courts, and between federal courts in their exercise of diversity jurisdiction: Is it a violation of due process of law as an unconstitutional forfeiture of property rights for a state or federal court to award a foreclosing mortgagee a deficiency judgment calculated solely by subtracting the net proceeds of a forced auction sale from the amount owed, without the court conducting an evidentiary hearing after sale confirmation to first determine the fair value of a foreclosed property?

3. Is it a violation of due process and equal protection, when a right to appeal is expressly provided by state law, for a state appellate court nevertheless to deny the right to appeal based solely upon a filed notice of appeal delayed solely due to a malfunction in that state’s authorized electronic appellate filing system?

 

20161205080816_1_1 by DinSFLA on Scribd

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National Fair Housing Alliance Accuses Mortgage Giant Fannie Mae of Racial Discrimination in 38 U.S. Metro Areas

National Fair Housing Alliance Accuses Mortgage Giant Fannie Mae of Racial Discrimination in 38 U.S. Metro Areas

Mortgage Giant Fannie Mae Accused of Racial Discrimination
in 38 U.S. Metro Areas
 

National Fair Housing Alliance and 20 Civil Rights Groups
File Federal Lawsuit Over Neglected Foreclosures

WASHINGTON, D.C. — Today, the National Fair Housing Alliance (NFHA) and 20 local fair housing organizations from across the United States filed a housing discrimination lawsuit against Fannie Mae in federal district court in San Francisco, California. The lawsuit alleges that Fannie Mae purposely fails to maintain its foreclosures (also known as real estate owned or “REO” properties) in middle- and working-class African American and Latino neighborhoods to the same level of quality it does for foreclosures it owns in white middle- and working-class neighborhoods. The data supporting the federal lawsuit, which includes substantial photographic evidence, shows a stark pattern of discriminatory conduct by Fannie Mae in the maintenance of its foreclosures.

The lawsuit is the result of a multi-year investigation. During the past several years, NFHA notified Fannie Mae many times of its failure to maintain and market its foreclosed homes in communities of color to the same standard to which it was maintaining and marketing the foreclosed homes it owned in similar, predominantly white neighborhoods. In spite of numerous meetings between NFHA and Fannie Mae to address these disparities in maintenance and marketing, Fannie Mae persisted in its willful neglect of its properties in African American and Latino neighborhoods.

The initial investigation was undertaken by NFHA and two local fair housing organizations in 2009 and involved four metropolitan areas. Much of this evidence was shared with Fannie Mae. However, Fannie Mae failed to make changes to ensure equal treatment in the maintenance and marketing of its foreclosures in neighborhoods of color, and the investigation was expanded to include an additional 18 fair housing organizations, culminating in data from 212 cities in 38 metropolitan areas. Click to see the lists of regions and fair housing organizations.

Comprised of evidence from 2011 through 2015, the lawsuit contains information from more than 2,300 foreclosures owned and maintained by Fannie Mae. NFHA and its 20 partner fair housing organizations collected evidence at each property on over 35 data points that were identified as important to protecting, securing, and marketing the homes. Investigators also took and reviewed over 49,000 photographs of these foreclosures that document the differences in treatment.

For more information about the lawsuit, see our Fannie Mae page and view the materials below:
Read the press release
Read the complaint
View exhibit A (Fannie Mae field service checklists)
View the national presentation
View the presentations for each of the 38 metropolitan areas

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TFH 12/4 | What Every Homeowner Needs To Know Regarding How To Prove that the Promissory Note Your Foreclosing Mortgagee Submits to Court Is a Fake — Featuring Our Special Guest and Expert Computer Forensic Document Examiner, Dr. James Madison Kelley

TFH 12/4 | What Every Homeowner Needs To Know Regarding How To Prove that the Promissory Note Your Foreclosing Mortgagee Submits to Court Is a Fake — Featuring Our Special Guest and Expert Computer Forensic Document Examiner, Dr. James Madison Kelley

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII

LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL)

ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET

.

.

Sunday – December 4, 2016

Foreclosure Workshop #24:
Foreclosure Workshop #24: Tehiva v. Ocwen — A Revealing Case Study in Abusive Loan Servicing, Why Federal and State Regulation Continues To Fail, and What the Trump Administration Can and Should Immediately Do About It

This Sunday we will present the most definitive up-to-date analysis yet available concerning recent investigative breakthroughs in the scientific basis for successfully disputing in court the authenticity of promissory notes and related endorsements and allonges.

Judges are especially welcome to listen to the show.

Those who miss this important live broadcast can listen to it on the Past Broadcast Section of our Website at www.foreclosurehour.com shortly after it airs live on KHVH-AM News Radio in Honolulu and simultaneously throughout the United States on the iHeart Internet App.

.
Host: Gary Dubin - Co-Host: John Waihee -

.

CALL IN AT (808) 521-8383 OR TOLL FREE (888) 565-8383

Have your questions answered on the air.

Submit questions to info@foreclosurehour.com

The Foreclosure Hour is a public service of the Dubin Law Offices

Past Broadcasts

EVERY SUNDAY 3:00 PM HAWAII 6:00 PM PACIFIC 9:00 PM EASTERN ON KHVH-AM (830 ON THE DIAL) AND ON iHEART RADIO

The Foreclosure Hour 12

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Inside Trump Treasury nominee’s past life as ‘foreclosure king’ of California

Inside Trump Treasury nominee’s past life as ‘foreclosure king’ of California

Steve Mnuchin was once CEO of OneWest bank, which has been accused of lending dubious mortgages to the elderly and evicting thousands in the state

The Guardian-

Lights flashing, three police cars showed up to Bill Montes-Pack’s quiet suburban street on the morning of 15 December 2015. The Benicia, California, man had stayed up all night waiting for the sheriff’s office to evict him from the house his grandparents had owned since 1971.

The foreclosure – which he said was based on a predatory loan and improper paperwork – originated with lender OneWest Bank, at the time run by chairman and CEO Steven Mnuchin. The veteran Wall Street financier’s foreclosure practices are receiving fresh scrutiny this week after president-elect Donald Trump announced him as the nominee for US Treasury secretary.

continue reading THE GUARDIAN

image: Sam Levin for the Guardian

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21 Lawmakers Come Out To Defend The Consumer Financial Protection Bureau

21 Lawmakers Come Out To Defend The Consumer Financial Protection Bureau

Consumerist-

While most federal agencies will soon see a change in leadership and direction after President-elect Donald Trump takes office, the head of the Consumer Financial Protection Bureau is supposed to be shielded from such sudden changes. A recent court decision put that protection — and the future of the CFPB itself — in question, but today a group of 21 federal lawmakers, along with a coalition of consumer advocates and civil rights groups, asked the court to keep the CFPB’s structure intact.

A quick round of catch-up for those coming in late: The CFPB has only one director — currently Richard Cordray, who still has a few years left on his term — and under the law that created the Bureau, the CFPB Director can only be removed from office by the President “for cause,” meaning the Director would need to screw up really badly.

In most cases where a federal agency has only one director, the President has the authority to remove that director at will. On the other side of the coin are the agencies with multiple commissioners (and usually a chairperson) who can’t be easily removed by the President, but where no single commissioner’s vote counts more than the others.

[CONSUMERIST]

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Trump to tap billionaire Wilbur Ross for Commerce secretary

Trump to tap billionaire Wilbur Ross for Commerce secretary

CNN Money-

Billionaire investor Wilbur Ross is President-elect Donald Trump’s pick for Commerce secretary, two sources tell CNN.

The nomination is expected to be rolled out as part of an economic team announcement on Wednesday, when Trump will likely name Steven Mnuchin as treasury secretary.

The Cabinet-level position, which requires Senate confirmation, serves as the government’s chief business advocate. The Commerce secretary is a liaison between companies and the White House. Ross could play a key role in what are expected to be Trump’s signature economic policy issues like trade and jobs.

[CNN MONEY]

image: Insider Monkey

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Steven Mnuchin Is Donald Trump’s Expected Choice for Treasury Secretary

Steven Mnuchin Is Donald Trump’s Expected Choice for Treasury Secretary

NYT-

WASHINGTON — Steven Terner Mnuchin, a financier with deep roots on Wall Street and in Hollywood but no government experience, is expected to be named Donald J. Trump’s Treasury secretary as soon as Wednesday, people close to the transition say.

Mr. Mnuchin, 53, was the national finance chairman for Mr. Trump’s campaign. He began his career at Goldman Sachs, where he became a partner, before creating his own hedge fund, moving to the West Coast and entering the first rank of movie financiers by bankrolling hits like the “X-Men” franchise and “Avatar.”

As Treasury secretary, Mr. Mnuchin would play an important role in shaping the administration’s economic policies, including a package of promised tax cuts, increased spending on infrastructure and changes in the terms of foreign trade. He could also help lead any effort to roll back President Obama’s nuclear deal with Iran and opening to Cuba by reimposing sanctions on Tehran and Havana.

[NYT]

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Trump is meeting with an ex-bank CEO who wants to abolish the Federal Reserve and return to the gold standard

Trump is meeting with an ex-bank CEO who wants to abolish the Federal Reserve and return to the gold standard

Business Insider-

As President-elect’s Donald Trump’s transition rolls on, more and more attention is being paid to possible selections for a variety of high-ranking positions and meetings that might help decide these appointments.

On Monday, Trump will meet with John Allison, the former CEO of the bank BB&T and of the libertarian think tank the Cato Institute.

There have been reports that Allison is being considered for Treasury secretary.

Trump’s has on the campaign trail questioned the future of the Federal Reserve’s political independence, but Allison takes that rhetoric a step further. While running the the Cato Institute, Allison wrote a paper in support of abolishing the Fed.

[BUSINESS INSIDER]

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Pro se PREVAILS on “fraud count” | Paul Farah v. Wells Fargo Home Mortgage | AFFIRMED in part, VACATED in part, and REMANDED | Court of Appeals for the Ninth Circuit

Pro se PREVAILS on “fraud count” | Paul Farah v. Wells Fargo Home Mortgage | AFFIRMED in part, VACATED in part, and REMANDED | Court of Appeals for the Ninth Circuit

Paul Farah v. Wells Fargo Home Mortgage

(9th Cir. 2016)

Court of Appeals for the Ninth Circuit

View original: From the court   |   Our backup
 . . .

In light of these additional allegations regarding nondisclosure of material information, we conclude that the district court erred in dismissing Farah’s fraud claim against Wells Fargo Home Mortgage. ……(setting forth circumstances, including exclusive knowledge or partial suppression of material facts, in which nondisclosure constitutes actionable fraud);

Accordingly, we vacate the judgment as to Farah’s fraud claim against Wells Fargo Home Mortgage and remand for further consideration consistent with this disposition.

AFFIRMED in part, VACATED in part, and REMANDED.


3
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Green Tree Servicing, L.L.C. v. Easley | Robo-witness testimony dissected and DESTROYED | Judgment reversed and cause remanded

Green Tree Servicing, L.L.C. v. Easley | Robo-witness testimony dissected and DESTROYED | Judgment reversed and cause remanded

Green Tree Servicing, L.L.C. v. Easley

(Ohio Ct. App. 2016)

View original: From the court   |   Our backup

 

Ohio Court of Appeals


. . .

{¶14} As indicated above, Mr. Easley’s Note was endorsed in 
blank, and, as such, the holder of his Note is its current 
possessor. See Bank of Am., N.A. v. McCormick, 9th Dist.
Summit No. 26888, 2014-Ohio-1393, ¶ 8. However, Ms. 
Kessner’s affidavit, submitted on behalf of Green Tree, 
failed to: (1) establish that Ms. Kessner had personal 
knowledge of Mr. Easley’s loan file; (2) aver that Ms. 
Kessner personally reviewed the original Note, Mortgage,
and assignments in Mr. Easley’s loan file, or, that true 
and accurate copies of those documents were attached to 
the motion for summary judgment; (3) 
prove that Ditech Financial LLC and

Green Tree Servicing LLC are the same legal entity; 
and (4) establish that Ditech Financial LLC
FKA Green Tree Servicing LLC has possession of the 
original Note.

 {¶15} Accordingly, the materials submitted by Green Tree along 
with its motion for summary judgment failed to demonstrate an 
absence of a dispute of fact that it had standing at the time it 
filed its complaint. See Dvorak at ¶ 16.

       {¶16} Mr. Easley’s first assignment of error is 
sustained.

 

III

       {¶18} Mr. Easley’s first assignment of error is 
sustained and his second assignment of
error is moot. The judgment of the Summit County Court 
of Common Pleas is reversed and the cause remanded for 
further proceedings consistent with this opinion.
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Wells Fargo tries to kill fake account lawsuit

Wells Fargo tries to kill fake account lawsuit

CNN-

Wells Fargo may be sounding a more friendly tone these days, but the big bank is still playing legal hard ball with victims in the fake account scandal.

Wells Fargo (WFC) customers have opened a class action lawsuit against the bank over the opening of unauthorized accounts in their names.

But Wells Fargo is trying to derail that lawsuit. The bank on Wednesday asked the U.S. District Court in Utah, where the class action suit was filed, to force dozens of those customers to resolve their claims quietly in closed-door arbitration instead of open court.

[CNN MONEY]

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Feds Give Up Trying To Hold Bank Of America Accountable For Countrywide’s “Hustle” Mortgage Scam

Feds Give Up Trying To Hold Bank Of America Accountable For Countrywide’s “Hustle” Mortgage Scam

Consumerist-

A nasty four-year legal battle between the Justice Department and Bank of America over a massive mortgage-related scam run by Countrywide Financial has come to a whimpering conclusion, with the DOJ opting to not appeal its most recent defeat in the case.

Let’s take a quick spin back a decade to the final years of the adjustable-rate mortgage boom, when shady mortgage lenders — Countrywide being the most prominent — were writing home loans to applicants who would likely be unable to keep up with the payments, and then reselling those poorly underwritten loans to Fannie Mae and Freddie Mac without disclosing that they might as well have been signed by kittens using invisible ink.

Countrywide had a name for this process — the High Speed Swim Lane (HSSL or “Hustle”) — that deliberately removed many of the underwriting roadblocks intended to prevent lenders from writing toxic loans, and resulted in Fannie and Freddie buying billions of dollars in loans from the company.

[CONSUMERIST]

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FNMA v. MIRABELLA AT MIRASOL HOMEOWNERS’ASSOCIATION, INC. | FL 4DCA – we find that Mirabella was entitled to seek the entire amount of unpaid assessments because FNMA failed to “initially join” Mirabella in the FNMA mortgage foreclosure.

FNMA v. MIRABELLA AT MIRASOL HOMEOWNERS’ASSOCIATION, INC. | FL 4DCA – we find that Mirabella was entitled to seek the entire amount of unpaid assessments because FNMA failed to “initially join” Mirabella in the FNMA mortgage foreclosure.

FEDERAL NATIONAL MORTGAGE ASSOCIATION, Appellant,
v.
MIRABELLA AT MIRASOL HOMEOWNERS’ ASSOCIATION, INC., Appellee.

No. 4D15-4792.
District Court of Appeal of Florida, Fourth District.
November 23, 2016.
Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm Beach County; Eli Breger, Senior Judge; L.T. Case No. 2014CA011112.

Dariel Abrahamy and Aaron Williams of Greenspoon Marder, P.A., Boca Raton, for appellant.

Ryan M. Aboud and Keith F. Backer of Backer Aboud Poliakoff & Foelster, LLP, Boca Raton, for appellee.

ROBERT W. LEE, Associate Judge.

The question in this appeal is one of first impression in Florida: which word does the word “initially” modify in the statute limiting liability of a first mortgage holder for certain homeowner association assessments? Because we believe the trial court correctly construed the statute by applying that word to the verb “join,” we affirm.

The appellant Federal National Mortgage Association (“FNMA”) obtained title to certain real property in Palm Beach County through an action foreclosing its first mortgage. At the time it filed its foreclosure action, it failed to join the appellee homeowners association (“Mirabella”) to extinguish any interest or claim Mirabella may have had in the subject property. Ultimately, four years into the mortgage foreclosure action, FNMA amended its complaint to join Mirabella.

Generally speaking, as established at common law, a junior lienholder cannot extinguish a senior lienholder’s interest in real property. Because the Mirabella Declaration of Covenants (“Declaration”) provides for a continuing lien for assessments and was recorded in the public records prior to the recording of the FNMA mortgage, the liability for assessments coming due under the recorded Declaration would have priority over the subsequently-filed mortgage under common law. LR5A-JV, LP v. Little House, LLC, 998 So. 3d 1173, 1175 n.2 (Fla. 5th DCA 2008). The Florida Legislature, however, modified the common law scheme by enacting Section 720.3085(2)(c), Florida Statutes, sometimes referred to as a “safe harbor” statute. Under this statute,

the liability of a first mortgagee, or its successor or assignee as a subsequent holder of the first mortgage who acquires title to a parcel by foreclosure or by deed in lieu of foreclosure for the unpaid assessments that became due before the mortgagee’s acquisition of title, shall be the lesser of:

1. The parcel’s unpaid common expenses and regular periodic or special assessments that accrued or came due during the 12 months immediately preceding the acquisition of title and for which payment in full has not been received by the association; or

2. One percent of the original mortgage debt.

Continuing, this subsection of the statute further provides that “[t]he limitations on first mortgagee liability . . . apply only if the first mortgagee filed suit against the parcel owner and initially joined the association as a defendant in the mortgage foreclosure action.” § 720.3085(2)(c), Fla. Stat. (emphasis added). Therefore, if Mirabella were “initially joined” in the action, FNMA would face only limited liability for assessments coming due before it took title to the property.

After FNMA gained title to the property through the foreclosure action, Mirabella brought its own lien foreclosure action against FNMA to collect all pre-title assessments due to Mirabella, without limitation. FNMA defended by arguing that it did not have to pay these assessments because it was protected by the safe harbor statute.

While Mirabella agrees that FNMA as a first mortgagee would have been able to take advantage of the limited liability statute, it argues that FNMA never sailed into the safe harbor because FNMA failed to “initially join” Mirabella in the mortgage foreclosure action. In other words, by waiting four years to join Mirabella as a defendant rather than doing so at the inception of the suit, FNMA never acquired the protection of the statute. On the other hand, FNMA argues that the word “initially” refers to the entire first action for foreclosure, and that the statute would not apply in a subsequent action such as an action to reforeclose an omitted junior lienholder. Under FNMA’s interpretation, as long as it added Mirabella as a defendant in the initial action at some point, FNMA would be protected. The trial court, however, agreed with Mirabella.

We agree with the trial court that the statute is not ambiguous. It takes no linguistic feat to determine that the adverb “initially” modifies “joined” and not “action.” If the legislature had intended the word to apply to “action,” it would have used the adjective “initial” instead of the adverb “initially” and placed it next to the phrase “mortgage foreclosure action.” Simply put, while the legislature could have provided that the safe harbor applied if the association were joined at any point in the initial mortgage foreclosure action, that is not what the legislature said.

FNMA urges that such a construction would result in an absurdity. We disagree. It is completely reasonable to conclude that the legislature, in modifying the common law position, wanted a homeowners association to be able to be involved in the case from the start so that it could have the ability to move the case along and monitor its progress. It could then notice the case for trial at an early point in the litigation. It could ask the court for mediation. As a non-profit entity, it could have attempted to minimize its loss in assessments as it is generally in an association’s best interest to move the case to a quick resolution. See Michael J. Gelfand, Condominium and Homeowners’ Association Liens, in FLORIDA CONDOMINIUM AND COMMUNITY ASSOCIATION LAW § 16.92 (The Fla. Bar ed., 2d ed. 2011).

In this case, we find that Mirabella was entitled to seek the entire amount of unpaid assessments because FNMA failed to “initially join” Mirabella in the FNMA mortgage foreclosure.

Affirmed.

CIKLIN, C.J., and TAYLOR, J., concur.

* * *

Not final until disposition of timely filed motion for rehearing.

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TFH 11/27 | Foreclosure Workshop #24: Tehiva v. Ocwen — A Revealing Case Study in Abusive Loan Servicing, Why Federal and State Regulation Continues To Fail, and What the Trump Administration Can and Should Immediately Do About It

TFH 11/27 | Foreclosure Workshop #24: Tehiva v. Ocwen — A Revealing Case Study in Abusive Loan Servicing, Why Federal and State Regulation Continues To Fail, and What the Trump Administration Can and Should Immediately Do About It

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII

LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL)

ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET

.

.

Sunday – November 27, 2016

Foreclosure Workshop #24:
Tehiva v. Ocwen — A Revealing Case Study in Abusive Loan Servicing, Why Federal and State Regulation Continues To Fail, and What the Trump Administration Can and Should Immediately Do About It

Neither hundreds of whistleblowers, nor billions of dollars in sanctions, nor occasional multi-million dollar jury awards, nor even a constant parade of back-slapping signed consent orders has yet to prevent loan servicers from continuing to callously abuse homeowners, turning our courts into collection agencies for crooks.

Why? Because no amount of federal and state regulation has been or is institutionally capable of controlling such low visibility abuses.

On this Sunday’s Foreclosure Hour we will celebrate Thanksgiving by unveiling a new proposal to restore the American dream of home ownership by a common sense combination of smart legislation and executive orders that not only could immediately end loan servicer abuses, but could easily also instantly terminate most of the foreclosure crisis in the United States.

You, our Federal and State Legislators, and Members of the incoming Trump Administration cannot afford to miss this Sunday’s Thanksgiving show.

Those who miss this important live broadcast can listen to it on the Past Broadcast Section of our Website at www.foreclosurehour.com shortly after it airs live on KHVH-AM News Radio in Honolulu and simultaneously throughout the United States on the iHeart Internet App.

.
Host: Gary Dubin - Co-Host: John Waihee -

.

CALL IN AT (808) 521-8383 OR TOLL FREE (888) 565-8383

Have your questions answered on the air.

Submit questions to info@foreclosurehour.com

The Foreclosure Hour is a public service of the Dubin Law Offices

Past Broadcasts

EVERY SUNDAY 3:00 PM HAWAII 6:00 PM PACIFIC 9:00 PM EASTERN ON KHVH-AM (830 ON THE DIAL) AND ON iHEART RADIO

The Foreclosure Hour 12

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