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PHH MTGE. CORP. v. Ramsey | OH Appeals Court “affidavits and exhibits submitted in connection with plaintiff’s SJ motion reveal genuine issues of material fact”

PHH MTGE. CORP. v. Ramsey | OH Appeals Court “affidavits and exhibits submitted in connection with plaintiff’s SJ motion reveal genuine issues of material fact”

2012 Ohio 672

PHH Mortgage Corporation fka Cendent Mortgage Corporation dba Coldwell Banker Mortgage, Plaintiff-Appellee,
Andrew Ramsey et al., Defendants-Appellants.


No. 11AP-559.
Court of Appeals of Ohio, Tenth District, Franklin County. 

Rendered on February 21, 2012.
Lerner, Sampson & Rothfuss, and Patricia K. Block, for appellee.Goldman & Rosenthal, and Lee S. Rosenthal, for appellants.



{¶ 1} Defendants-appellants, Andrew Ramsey and Precision Real Estate Group, LLC, appeal from a judgment of the Franklin County Court of Common Pleas that granted the summary judgment motion of plaintiff-appellee, PHH Mortgage Corporation fka Cendent Mortgage Corporation dba Coldwell Banker Mortgage, entered judgment for plaintiff in the principal balance of $53,956.13 plus interest, determined plaintiff to be the first lien on the property subject of the mortgage, and ordered foreclosure on the subject premises. Defendants assign a single error:

The Trial Court committed error when it granted Summary Judgment to Appellee because Appellants presented evidence of genuine issues of material fact to be litigated.

Because genuine issues of material fact preclude granting summary judgment to plaintiff, we reverse.

I. Facts and Procedural History

{¶ 2} Plaintiff filed a complaint on November 10, 2009 against, among others, defendant Andrew Ramsey. Count One of the complaint alleged defendant owed plaintiff $53,956.13, together with interest at the rate of 7.00500 percent per year from July 1, 2009 as a result of his default on a note of which plaintiff was the holder. Count Two sought to reform the mortgage securing the note to correct a scrivener’s error, and Count Three asked the court not only to declare plaintiff to be the first lien on the property but to foreclose on the mortgage.

{¶ 3} After Precision Real Estate Group, LLC was added as a defendant, both defendants filed a joint answer to plaintiff’s complaint on April 27, 2010. Plaintiff responded to their answer with a motion for summary judgment filed on July 16, 2010; on the same date, plaintiff sought default judgment against those parties who had not filed an answer to the complaint. Before responding to plaintiff’s motion for summary judgment, defendants sought and were granted leave to file a counterclaim against plaintiff. They followed the counterclaim with a memorandum opposing plaintiff’s motion for summary judgment.

{¶ 4} On November 18, 2010, the trial court referred the case to mediation and vacated the scheduled trial date pending the outcome of mediation. When mediation proved unsuccessful, the court rescheduled the matter for trial. With leave of court, plaintiff filed a renewed motion for summary judgment on its complaint and defendants’ counterclaim.

{¶ 5} After the parties briefed the motion, the trial court filed an entry on May 27, 2011, determining no genuine issue of material fact existed and plaintiff was entitled to judgment and foreclosure as a matter of law. Accordingly, the trial court granted plaintiff summary judgment, entered a decree in foreclosure, reformed plaintiff’s mortgage and deed, and dismissed with prejudice defendants’ counterclaim.

II. Summary Judgment—Genuine Issues of Material Fact

{¶ 6} Defendants’ single assignment of error asserts the trial court wrongly granted plaintiff summary judgment because genuine issues of material fact exist to be resolved at trial.

A. Applicable Law

{¶ 7} An appellate court’s review of summary judgment is conducted under a de novo standard. Coventry Twp. v. Ecker, 101 Ohio App.3d 38, 41 (9th Dist.1995); Koos v. Cent. Ohio Cellular, Inc., 94 Ohio App.3d 579, 588 (8th Dist.1994). Summary judgment is proper only when the parties moving for summary judgment demonstrate: (1) no genuine issue of material fact exists, (2) the moving parties are entitled to judgment as a matter of law, and (3) reasonable minds could 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 most strongly construed in its favor. Civ.R. 56; State ex rel. Grady v. State Emp. Relations Bd., 78 Ohio St.3d 181 (1997).

B. Affidavit

{¶ 8} In responding to plaintiff’s summary judgment motion, Ramsey admitted to being the obligor on the note and mortgage attached to plaintiff’s complaint but stated payments were current through July 2009 under the terms of the note and mortgage. According to the affidavit, he “always made [his] payments online.” (Affidavit, ¶ 3.)

{¶ 9} As Ramsey’s affidavit explained, he attempted to make his August payment electronically, or online, on August 3, 2009 but received an online response that plaintiff was not able to process his payment at that time. He again attempted to pay online on August 6 and 10 but again received the response that plaintiff was unable to process the payment. Ramsey attached to his affidavit the responses received online.

{¶ 10} On August 13, he again attempted an online payment, and the payment appeared to be successful. At the end of the transaction, however, he did not receive a confirmation number. He called the help desk and was given a confirmation number for his August payment. The person at the help desk further told Ramsey “that the payment would be pushed through the system and `not to worry.'” (Affidavit, ¶ 5.) After receiving a late payment notice from plaintiff on August 16, 2009, Ramsey again called the help line on August 21, 2009. The person Ramsey spoke to informed him “that Plaintiff was having some system issues but that [his] payment would be processed as he could see it `stuck’ in the system.” (Affidavit, ¶ 6.)

{¶ 11} On September 3, 2009, Ramsey attempted to complete his September payment online, but it could not be processed. At that time, Ramsey became aware that the August 2009 payment was never processed as promised, because a late fee was charged to his account. When he checked his bank account, he learned his August payment was never debited from his account.

{¶ 12} Ramsey again called the help desk, and the person he spoke to said she would process his payment. Ramsey expressed his concern about the payment being considered late, and the help desk person acknowledged the late payment would be placed on his credit report. Ramsey asked that it be removed because the delay was not his fault, but he was told nothing could be done about it. Ramsey asked to speak with someone else; he “was told there was no one else to speak with.” (Affidavit, ¶ 7.) Ramsey requested to speak with the legal department, but the help desk person refused to transfer him and hung up the telephone.

{¶ 13} After being unable to make an online payment on September 3, Ramsey contacted the Coldwell Banker/King Thompson real estate agent who sold him the property to see if he could suggest any avenue to clear up the matter. Someone from the local office called Ramsey, said they would check on the situation and get back to him, but did not. As a result, on September 9, 2009, Ramsey physically went to the Coldwell Banker/King Thompson office on Polaris Parkway, explained the situation to the receptionist, and asked if he could speak with someone at that location. He was informed no one at the location had authority in the matter, he attempted payment, and his payment was refused.

{¶ 14} The next day, Ramsey forwarded a letter to Coldwell Banker/King Thompson, together with a check in the amount of $1,600 for the August and September 2009 payments on the note. The letter explained the situation, but the check was never cashed or returned to Ramsey. On October 5, 2009, Ramsey sent another check in the amount of $1,600 as payment for October and November, accompanied by another letter of explanation. Again, the check was neither cashed nor returned.

C. Plaintiff’s Arguments

{¶ 15} Aware of defendants’ factual contentions from their response to plaintiff’s first summary judgment motion, plaintiff’s renewed motion for summary judgment alleged plaintiff was entitled to judgment because (1) Ramsey did not attempt to make payment and has no contractual right to pay online, and (2) plaintiff was not required to accept partial payment in the event of default. Plaintiff argues similarly on appeal.

1. Online payments

{¶ 16} Plaintiff points to the terms of the note and mortgage to support its contention that Ramsey had no contractual right to pay electronically, as the mortgage specifies that payments shall be made in U.S. currency. Whether the provision addresses the issue at hand is questionable at best, as it appears to preclude payment in foreign currency. Moreover, nothing in the note or mortgage precludes electronic payment. To the contrary, the document contemplates electronic funds transfer as an acceptable mode of payment, specifying that if any check or other instrument the lender receives as payment is returned unpaid, the lender may require “any and all subsequent payments due under the Note and this Security Instrument be made in one or more of the following forms, as selected by the Lender: * * * Electronic Funds Transfer.” (Mortgage, ¶ 1.)

{¶ 17} In addition, Ramsey’s affidavit states he always made payments electronically. As a result, a genuine issue of material fact exists as to whether plaintiff waived any provision of the agreement that possibly required other than electronic payment. See EAC Properties, L.L.C. v. Brightwell, 10th Dist. No. 10AP-853, 2011-Ohio-2373, ¶ 23, appeal not allowed, 129 Ohio St.3d 1506, 2011-Ohio-5358 (noting that whether a party’s inconsistent conduct amounts to waiver involves a factual determination within the province of the trier of fact).

{¶ 18} Plaintiff next suggests that even if online payments are acceptable, payments are not deemed received until the lender receives them at the location designated in the note or such other location as the lender may designate. Plaintiff argues that because Ramsey was aware his attempted online payments were ineffective but nonetheless failed to send them to the designated location, he failed to make payment according to the note and mortgage. Ramsey’s affidavit explains his efforts to make the regular payments beginning with his August payment. The affidavit states he called on August 13, 2009 concerning the August payment and received confirmation for it. Although plaintiff contends its records do not reflect a payment in August, the dispute over the August payment is in itself an issue for a trier of fact to resolve after hearing all the evidence, resolution of which may affect Ramsey’s subsequent payments, at least one of which was forwarded in advance of the due date.

2. Timeliness and partial payment

{¶ 19} Plaintiff also asserts Ramsey’s attempt to make his August payment was untimely, noting payments were to be made on the first of the month but Ramsey did not attempt payment until, at the earliest, August 3, 2009. Plaintiff’s argument presents at least two issues. Initially, the pertinent documents specify a late fee, suggesting failure to make payment on the first of each month is not necessarily a default on the note, even though it may cause Ramsey to incur late fees. Secondly, the exhibits attached to plaintiff’s affidavit indicate Ramsey on many occasions made payments after the first of the month, and plaintiff accepted them, thus raising an issue of plaintiff’s possible waiver of the provisions requiring payment on the first of the month.

{¶ 20} Pertinent to the waiver issue, both the note and mortgage contain anti-waiver provisions. The note states that “[e]ven if, at a time when [the borrower is] in default, the Note Holder does not require [the borrower] to pay immediately in full as described above, the Note Holder will still have the right to do so if [the borrower is] in default at a later time.” (Note, ¶ 6(D).) To the extent the provision applies under these circumstances, the record evidence does not appear to address whether plaintiff invoked its rights. The mortgage states that “Lender may accept any payment or partial payment insufficient to bring the Loan current, without waiver of any rights hereunder or prejudice to its right to refuse such payments or partial payments in the future.” (Mortgage, ¶ 1.) To the extent the provision applies, the evidence again is unclear that plaintiff ever invoked the provision, as its September 9, 2009 letter to Ramsey not only does not declare him in default, but demands payment for the months of August and September.

{¶ 21} In the end, Ramsey’s version of the payment history between the parties creates genuine issues concerning the due date for payments and the applicability of the anti-waiver provisions. Cf. Fairfield Natl. Bank v. Lininger, 5th Dist. No. 02-CA-25, 2002-Ohio-4875, ¶ 31 (noting “[i]t is well settled that if one accepts late payments and subsequently wishes to insist on a specific due date as a `time of the essence’ requirement, prior notification thereof is required”) and First Natl. Bank of Am. v. Pendergrass, 6th Dist. No. E-08-048, 2009-Ohio-3208, ¶ 25 (noting “it has repeatedly been held that a mortgagee’s previous acceptance of late loan payments does not constitute a waiver of the mortgagee’s right to accelerate and foreclose on a loan following a subsequent default where, as here, the relevant loan documents contain `anti-waiver’ provisions”). The trial court did not address those issues. In the absence of the trial court’s addressing the meaning and applicability of the note and mortgage anti-waiver provisions to the facts provided in the parties’ affidavits and exhibits, we decline to do so in the first instance.

{¶ 22} Lastly, plaintiff’s motion for summary judgment asserts that because Ramsey was in default on his payment, the entire amount of the note became due, leaving plaintiff free to reject Ramsey’s attempt to partially pay by tendering the September and October payments to plaintiff. Because a genuine issue of material fact exists as to whether Ramsey defaulted on the note, plaintiff’s argument premised on a default is premature.

{¶ 23} In the final analysis, the affidavits and exhibits submitted in connection with plaintiff’s summary judgment motion reveal genuine issues of material fact regarding whether Ramsey defaulted in his payment on the note, making summary judgment inappropriate. Defendants’ single assignment of error is sustained, the judgment of the trial court is reversed, and this matter is remanded for further proceedings consistent with this decision.

Judgment reversed and cause remanded.

SADLER and CONNOR, JJ., concur.

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PHH MORTGAGE v. ALBUS | Ohio Appeals Court Reverses “Tracy Johnson Affidavit, Illegible Loan History Statment, No Certificate of Service”

PHH MORTGAGE v. ALBUS | Ohio Appeals Court Reverses “Tracy Johnson Affidavit, Illegible Loan History Statment, No Certificate of Service”






{6} Appellee also filed the affidavit of Tracy Johnson, the loan supervisor assigned to Appellant’s account. According to the affidavit, Appellant defaulted on the note and Appellee exercised the acceleration option contained in the note. (Johnson Aff., ¶4-5.) Johnson avers that an unpaid principal balance exists in the amount of $56,874.74, with interest to accrue at the rate of 8.308% per annum from November 1, 2006, “plus sums advanced by Plaintiff pursuant to the terms of the Mortgage Deed for real estate taxes, hazard insurance premiums and property protection* * *.” (Johnson Aff., ¶5.) An illegible loan history statement is attached to the affidavit, as well as a customer activity statement and a loan activity statement. No certificate of service is included in the record with the document.


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NY Judge Spinner Denies 86 Applications for JUDGMENT OF FORECLOSURE AND SALE Due to No Affirmation by Plaintiff Counsel

NY Judge Spinner Denies 86 Applications for JUDGMENT OF FORECLOSURE AND SALE Due to No Affirmation by Plaintiff Counsel


Plaintiff has applied to this Court for the granting of a Judgment of Foreclosure & Sale pursuant to RPAPL § 1351. The express provisions of the Administrative Order of the Chief Administrative Judge of the Courts, no. A0548/10 require the filing of an Affirmation by Plaintiff’s counsel. No such Affirmation has been filed in this proceeding, in derogation of the aforesaid mandate. Accordingly, this application must be denied.

It is, therefore,

ORDERED that the within application by the Plaintiff shall be and the same is hereby denied without prejudice.

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PHH Mortgage fined $290,000 for Incomplete and False Foreclosure Documents

PHH Mortgage fined $290,000 for Incomplete and False Foreclosure Documents

Illinois Department of Financial and Professional Regulation

For Immediate Release:

June 23, 2011

Mortgage Company fined $290,000 for Incomplete and False Foreclosure Documents

CHICAGO – PHH Mortgage Company has been fined $290,000 for signing foreclosure affidavits that the company knew would later be altered by its attorneys and for signing affidavits using someone else’s name, according to an order released today by the Illinois Department of Financial and Professional Regulation (IDFPR).  The violations were found during an ongoing special investigation of 20 Illinois licensed mortgage servicing companies, which was launched last year after learning of foreclosure improprieties across the country.

“At a time when homeowners are facing the possible loss of their most precious asset, homeowners have a right to expect their loan servicing company to file accurate and honest paperwork,” said Brent E. Adams, Secretary of Financial and Professional Regulation. “Time and again, the Department has sought to emphasize to loan servicing companies that home foreclosure is no time to cut corners.”

The order, signed by Manuel Flores, Director of IDFPR’s Division of Banking says that in at least 19 files, PHH failed to sign affidavits after they had been altered by the company’s attorneys and that PHH’s knowledge of and complicity with this process is evidenced by the fact that the original affidavits were incomplete and contained notations such as “will add” when they were tendered to the law firm of Fisher and Shapiro.  The law firm, in turn, under penalty of perjury and acting on behalf of PHH, then attested to the completeness of the altered affidavits although they had not been reviewed or re-executed by PHH.

The Department discovered other evidence of improprieties on the part of PHH employees in 16 of the 19 affidavits.  These 16 affidavits were identified as having all been signed and attested to by the same PHH employee in his or her official capacity.  Yet, the Department noted no less than five distinctly different signatures attributed to this same PHH employee, leading the Department to conclude that at least four different people used one employee’s name to sign the affidavits.  PHH has ten days to request a hearing on the Department’s order.

In December 2010, Department issued a 9-point “affidavit preparation expectations” plan establishing best practices for the handling of foreclosure-related documents.   Under the Department’s order, PHH has violated both the Residential Mortgage License Act of 1987 and these best practices established, publicized, and agreed to by several loan servicers late last year.
The 9-point plan:

  1. Affiants who sign affidavits in connection with foreclosure proceedings shall not use signature stamps to sign affidavits.
  2. Affiants signing affidavits stating the amount owed by a borrower (hereinafter “prove-up affidavits”) shall confirm that the numbers accurately reflect the numbers in the licensee’s business records and are totaled correctly.
  3. Affiants shall be individuals, not entities.
  4. Affiants shall have the level of knowledge necessary to submit an affidavit in a judicial proceeding.
  5. Lenders and servicers shall have processes in place to seek to ensure that affidavits used in connection with foreclosure proceedings are true, accurate, and complete, including that prove-up affidavits accurately reflect the amount due to the licensee.
  6. To the extent that an affidavit is notarized, it shall be done in compliance with the law of the state in which the affidavit is being notarized, which generally requires that the affidavit be executed in the presence of the notary after the notary has administered the oath and that the notary appropriately dates the prove-up affidavit.
  7. When using a form affidavit, Affiants shall not leave blanks or incomplete statements in the affidavit. Affiants shall date their signatures by hand on affidavits.
  8. When the Affiant’s signature is not plainly legible, the name of the Affiant shall be printed on the affidavit in order to permit the identity of the Affiant to be known.
  9. Lenders and servicers shall not file unsigned affidavits with the court.

Homeowners facing foreclosure and/or who have concerns or questions about the process may contact IDFPR’s mortgage hotline (800) 532-8785 (800) 532-8785


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Rep. Elijah E. Cummings seek subpoenas of 6 Banks on foreclosure crisis

Rep. Elijah E. Cummings seek subpoenas of 6 Banks on foreclosure crisis

Baltimore Sun-

Baltimore Rep. Elijah E. Cummings on Wednesday requested that the House Oversight Committee issue subpoenas to six banks he said have refused to voluntarily provide documents detailing their role in the mortgage foreclosure meltdown.

Cummings, the top-ranking Democrat on the committee who has made the foreclosure issue a top priority, said the documents are needed to help the committee determine how the foreclosure crisis unfolded. He said it is his first request for subpoenas since starting in the position in January.

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MILITARY | Jury Awards GI $20M in Mortgage Case

MILITARY | Jury Awards GI $20M in Mortgage Case

A federal jury awarded a Fort Benning Soldier more than $20 million on Monday in a case against Coldwell Banker Mortgage — an amount the plaintiff’s attorney called necessary to get the company’s attention.

Jurors in the case of David Brash v. PHH Mortgage Corp., doing business as Coldwell Banker, deliberated for about six hours before ruling in Brash’s favor. During the six-day trial, jurors heard that Coldwell Banker improperly reported Brash, 29, to credit bureaus which led to a “serious delinquency” on his credit report, that it refused to answer his questions or correct his account and damaged him emotionally, physically and financially, his attorneys and court documents say.

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WI Appeals Court “Defects In Publishing Summons in Wrong Paper” PHH MTG v. MATTFELD

WI Appeals Court “Defects In Publishing Summons in Wrong Paper” PHH MTG v. MATTFELD


No. 2010AP612.

Court of Appeals of Wisconsin, District II.

Opinion Filed: March 16, 2011.

Before Neubauer, P.J., Anderson and Reilly, JJ.


Scott P. Mattfeld and Shelley P. Mattfeld appeal from an order denying their motion for relief from a default judgment of foreclosure entered in favor of PHH Mortgage Corporation.[1] They also appeal the circuit court’s order granting The Daily Reporter Publishing Company’s motion to quash a subpoena to testify. The Mattfelds contend that because of defects in the service of the summons and complaint the circuit court lacked the personal jurisdiction necessary to enter a default judgment. We agree. The record supports the Mattfelds’ contention that they are entitled to relief from judgment under WIS. STAT. § 806.07 (2009-10)[2] because PHH Mortgage failed to publish the summons in a newspaper likely to give notice in the area where Scott or Shelley resided, as required by WIS. STAT. § 801.11(1)(c). We reverse the circuit court’s order denying the Mattfelds’ motion for relief and remand with direction to vacate the default judgment.


¶ 2 PHH Mortgage filed a summons and complaint for foreclosure of mortgage on August 6, 2008, naming Scott P. and Shelley P. Mattfield. Attached to the complaint is a copy of the mortgage indicating the correct spelling of the Mattfelds’ surname. The record also includes an invoice from The Daily Reporter for the publication of a real estate notice (“PHH Mtge vs. Scott P. Mattfield”) on October 7, 14 and 21 of 2008, and proof of publication. The proof of publication contains a notarized statement by the publisher that The Daily Reporter “is a public newspaper of general circulation, printed and published daily … in the City of Milwaukee, in said county.”

¶ 3 PHH Mortgage filed a motion for default judgment on December 1, 2008. In support of its motion, PHH Mortgage submitted the proof of publication and two affidavits of nonservice completed by process server Dwayne Turner. The proof of publication and affidavits of nonservice reflect that throughout the period of attempted service, the Mattfelds were incorrectly identified as the Mattfields. At the court’s request, PHH Mortgage’s attorney explained in correspondence dated January 2, 2009, that “[c]opies of the summons and complaint were never sent to the Mattfields at the Lannon Road address in Menomonee Falls on the date of publication … because our process server had been unable to find either Scott or Shelley Mattfield during several visits to that address in August of 2008.” The letter listed PHH Mortgage’s attempt to locate the “Mattfields” which included Internet searches, directory assistance, divorce records and voting records. PHH Mortgage’s attorney also stated: “CCAP posted new address information for both Shelley and Scott Mattfield on 11/26/08; we will mail a copy of this letter to each address today.” On January 6, 2009, the circuit court, Judge Kathryn Foster presiding, entered an order for judgment and judgment of foreclosure and sale in the amount of $373,068.12.[3]

¶ 4 On July 29, 2009, Scott Mattfeld’s attorney wrote to Judge Foster to advise that “Scott P. Mattfeld (mistakenly named in the pleadings as Mattfield)” had not been aware of the foreclosure proceedings. He contended that there had been various serious jurisdictional defects in service, “(in addition to the misspelling of the defendants’ surnames),” namely: (1) PHH Mortgage had used The Daily Reporter, a Milwaukee county publisher of legal notices and not a publication of general circulation in Waukesha county and (2) PHH Mortgage had notice that the property was vacant and as early as November 12, 2008, had notice of the address changes from the post office but never sent a copy of the summons and complaint to either new address. Scott maintained that the court “in all probability lacked jurisdiction to enter the various judgments, orders and rulings” and enclosed a proposed temporary injunction for the court’s consideration pending the filing of a WIS. STAT. § 806.07 motion for relief from judgment. Judge Foster entered the temporary injunction on July 31, 2009.

¶ 5 On September 9, 2009, the Mattfelds filed a WIS. STAT. § 806.07 motion to vacate the judgment of foreclosure. The Mattfelds argued under § 806.07(1) that the judgment was void due to the court’s lack of jurisdiction resulting from the failure of service of process. The circuit court, Judge Donald J. Hassin now presiding, denied the Mattfelds’ motion to vacate and dismiss the complaint. The Mattfelds moved for reconsideration. The Mattfelds argued that PHH Mortgage had failed to exercise due diligence in service of process and that the publication and mail service attempt was insufficient. With respect to publication, the Mattfelds maintained that PHH Mortgage’s attempt to obtain substitute service via publication under WIS. STAT. § 801.11(1)(c) had failed because The Daily Reporter is a publication limited to Milwaukee and does not meet the standard for legal publication in Menomonee Falls under WIS. STAT. § 985.02(1), which requires that publication be made in “a newspaper likely to give notice in the area or to the person affected.” The Mattfelds anticipated presenting further evidence as to the October 2008 circulation numbers in Menomonee Falls for The Daily Reporter, Waukesha Freeman and Milwaukee Journal Sentinel. The Mattfelds also cited PHH Mortgage’s failure to mail either of them a copy of the summons and complaint as a further shortcoming under § 801.11(1)(c).

¶ 6 The Mattfelds attempted to subpoena the publisher of the The Daily Reporter in order to obtain circulation information. The Daily Reporter sought, and was granted by the circuit court, an order to quash the subpoena. Following an evidentiary hearing on January 22, 2010, the circuit court denied the Mattfelds’ motion for relief from judgment. The Mattfelds appeal.


¶ 7 WISCONSIN STAT. § 806.07(1)(d) allows relief from a judgment or order if a “judgment is void.” A judgment is void for purposes of § 806.07 when the court rendering it lacked subject matter or personal jurisdiction. Richards v. First Union Secs., 2006 WI 55, ¶15, 290 Wis. 2d 620, 714 N.W.2d 913. A court gains jurisdiction over the parties only by valid personal and substituted service. See WIS. STAT. § 801.04; see also Span v. Span, 52 Wis. 2d 786, 789, 191 N.W.2d 209 (1971). Wisconsin compels strict compliance with the rules of statutory service, even though the consequences may appear to be harsh. Useni v. Boudron, 2003 WI App 98, ¶13, 264 Wis. 2d 783, 662 N.W.2d 672.

¶ 8 When a motion to reopen involves a question of proper service, the burden of proof is on the party seeking, pursuant to WIS. STAT. § 806.07, to set aside or vacate a default judgment. See Richards, 290 Wis. 2d 620, ¶27. The evidence necessary to set aside a default judgment is evidence sufficient to allow a court to determine that the circuit court’s findings of fact were contrary to the great weight and clear preponderance of the credible evidence. Id.

¶ 9 In their motion for postjudgment relief and on appeal, the Mattfelds challenge the sufficiency of service under WIS. STAT. § 801.11(1)(c) which governs personal jurisdiction. It provides that if “with reasonable diligence” a person cannot be served in person or by leaving a copy of the summons and complaint with a family member or competent adult at his or her usual place of abode, service may be made by publication. Sec. 801.11(1). Specifically,

(c) If with reasonable diligence the defendant cannot be served [in person or by leaving a copy of the summons and complaint with a family member or competent adult at his or her usual place of abode] service may be made by publication of the summons as a class 3 notice, under [WIS. STAT.] ch. 985, and by mailing. If the defendant’s post-office address is known or can with reasonable diligence be ascertained, there shall be mailed to the defendant, at or immediately prior to the first publication, a copy of the summons and a copy of the complaint. The mailing may be omitted if the post-office address cannot be ascertained with reasonable diligence.

The Mattfelds contend both that PHH Mortgage did not exercise reasonable diligence in serving them personally and that PHH Mortgage failed to comply with WIS. STAT. ch. 985 when it published the summons. Based on our review of the record, we conclude that the Mattfelds have demonstrated that the circuit court’s finding as to compliance with ch. 985 is contrary to the great weight of the evidence.

¶ 10 WISCONSIN STAT. § 985.02 governs “[m]ethod of notification.” It provides in relevant part that “[e]xcept as otherwise provided by law, a legal notice shall be published in a newspaper likely to give notice in the area or to the person affected.” (Emphasis added.) Proof of publication is required by WIS. STAT. § 985.12 in the form of an affidavit of printing “annexed to a copy of the notice clipped from the newspaper, and specifying the date of each insertion.” See[4] In contrast, PHH Mortgage’s proof of publication for notice of the sheriff’s foreclosure sale published in the Waukesha Freeman newspaper contains a statement from the billing coordinator for the Waukesha Freeman, “a public newspaper of general circulation, printed and published … in the City of Waukesha, in Waukesha County, Wisconsin.” It is undisputed that at that time of publication the Mattfelds’ last known residence was in Menomonee Falls in Waukesha county, and that Scott Mattfeld still resided in Menomonee Falls in October 2008. § 985.12(1). Here, the affidavit of printing indicates that The Daily Reporter “is a public newspaper of general circulation, printed and published daily … in the City of Milwaukee, in said county.” While PHH Mortgage asserted that “The Daily Reporter is the predominant newspaper to publish legal notices in the Milwaukee Metropolitan area,” it failed to provide any evidence to that effect. Indeed, a later affidavit submitted by the publisher notes that “The Daily Reporter is a newspaper that is distributed throughout the State of Wisconsin,” but also states that it is “a qualified legal newspaper in Milwaukee County, but it is not a qualified legal newspaper in Waukesha County, where the property that is a subject of the action is located.”

¶ 11 While PHH Mortgage asserts that the Mattfelds failed to provide argument or authority as to why The Daily Reporter would not have given notice to the Mattfelds, the undisputed record as it stood at the time of the default judgment failed to establish that publication in a newspaper “printed and published daily … in the City of Milwaukee, in said county” would have been likely to provide notice to a resident of Menomonee Falls in Waukesha county.[5][6] Although The Daily Reporter publisher later averred that the newspaper is distributed throughout Wisconsin, the only mention of Waukesha county was that The Daily Reporter was not qualified in that county. This again failed to establish that publication in The Daily Reporter would have been likely to provide notice to a resident of Waukesha county. The circuit court’s finding to the contrary was against the great weight of the evidence of record at the time of the Mattfelds’ WIS. STAT. § 806.07 motion to reopen.


¶ 12 We conclude that the Mattfelds carried their burden of proving that PHH Mortgage’s notice by publication failed to effect service on them and thus, the court did not have jurisdiction when it entered the default judgment against them. We reverse the circuit court’s order denying the Mattfelds’ motion to reopen and we remand with direction to vacate the default judgment.

By the Court.—Orders reversed and cause remanded with direction.

Not recommended for publication in the official reports.

[1] The record reflects that Scott and Shelley Mattfeld were in the process of divorcing while this foreclosure action was proceeding. It was unclear during the circuit court proceedings whether Scott’s counsel was representing both Scott and Shelley; however, the appeal was filed naming both Scott Mattfeld and Shelley Mattfeld as appellants and no issue has been raised regarding the application of this appeal to Shelley. We therefore refer to the appellants as the Mattfelds.

[2] All references to the Wisconsin Statutes are to the 2009-10 version unless otherwise noted.

[3] The property was subsequently sold to PHH Mortgage at a sheriff’s sale.

[4] A qualified newspaper is defined under WIS. STAT. § 985.03. It sets forth the following “qualifications of newspapers” for purposes of publication of legal notices:

(1)(a) No publisher of any newspaper in this state shall be awarded or be entitled to any compensation or fee for the publishing of any legal notice unless, for at least 2 of the 5 years immediately before the date of the notice publication, the newspaper has been published regularly and continuously in the city, village or town where published, and has had a bona fide paid circulation:

1. That has constituted 50% or more of its circulation; and,

2. That has had actual subscribers at each publication of not less than 1,000 copies in 1st and 2nd class cities, or 300 copies if in 3rd and 4th class cities, villages or towns.


(c) A newspaper, under this chapter, is a publication appearing at regular intervals and at least once a week, containing reports of happenings of recent occurrence of a varied character, such as political, social, moral and religious subjects, designed to inform the general reader. The definition includes a daily newspaper published in a county having a population of 500,000 or more, devoted principally to business news and publishing of records, which has been designated by the courts of record of the county for publication of legal notices for a period of 6 months or more.

Sec. 985.03(1). We recognize that there is no requirement that a newspaper be the official newspaper of a municipality under WIS. STAT. § 985.06 to meet the requirements of WIS. STAT. § 985.02.

[5] We take judicial notice of the fact that a current “all county” search of the foreclosure notices listed on The Daily Reporter Web site returns 200 notices, all of which are for foreclosures in Milwaukee county. See, (visited Jan. 30, 2011).

[6] While the Mattfelds contend that service was defective in other respects, we need not reach these issues. PHH Mortgage’s failure to effect service by publication disposes of all issues on appeal. See Sweet v. Berge, 113 Wis. 2d 61, 67, 334 N.W.2d 559, 562 (Ct. App. 1983) (if resolution of one issue disposes of the appeal, we need not address the other arguments raised).

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WI Appeals Court Reverses SJ “Affidavit Submissions, Do Not Authenticate Assignment and Note” PHH MTG v. KOLODZIEJ

WI Appeals Court Reverses SJ “Affidavit Submissions, Do Not Authenticate Assignment and Note” PHH MTG v. KOLODZIEJ


March 10, 2011






¶21 Because the assignment of the mortgage is neither authenticated by averments in an affidavit that would suffice at trial nor self-authenticated by means of a certified copy, it cannot be considered in determining whether PHH made a prima facie case for summary judgment.4


¶28 Because PHH’s submissions do not provide authentication for the mortgage assignment and for the endorsed note, its submissions do not make a prima facie showing that it is the holder of the mortgage and note. The court therefore erred in granting summary judgment in PHH’s favor. This conclusion makes it unnecessary to address the Estate’s argument that, even assuming these documents were authenticated, PHH still did not make a prima facie case for foreclosure.7

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Rhode Island BK Judge Upholds “Mediation Program” In re: Sosa, In re: Lawton

Rhode Island BK Judge Upholds “Mediation Program” In re: Sosa, In re: Lawton


To address that condition, and with no end to it in sight, we decided to break the log jam by introducing a process “for debtors and lenders to [mediate and to] reach consensual resolution when a debtor’s residential property is at risk of foreclosure” by “opening communications between debtors’ and [the] lenders’ decision-makers.”3 LMP §I Purpose, 1.


The Rhode Island Loss Mitigation Program was conceived as a case management tool designed to encourage the resolution of differences between residential mortgage lenders and their borrowers, and to provide a way for them to access the various federal housing programs available outside of bankruptcy, such as the Home Affordable Modification Program (HAMP). The Loss Mitigation Program is intended to start a dialogue, giving the parties nothing more than the opportunity to discuss their respective positions. The alleged dire consequences of the implementation of such a Program, as predicted by PHH have not materialized, and if any do emerge, they will be judicially
addressed forthwith.

For the reasons discussed above, and based on the arguments of the NCLC and by the Debtors, here and in Lawton, which are adopted and incorporated herein by reference, PHH’s Objection to participating in this Court’s loss mitigation program is OVERRULED.

Dated at Providence, Rhode Island, this 28th day of January, 2011.

Arthur N. Votolato
U.S. Bankruptcy Court
Entered on docket: 1/28/11

Continue to both orders below…

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