UNITED STATES BANKRUPTCY COURT DISTRICT OF NEW JERSEY
Re: In re Rodriguez (Chapter 13) Case No. 07-24687 (MBK)
EXCERPT:
D. The Attorneys’ Fees Requested are Reasonable Having ruled that the Debtors are entitled to attorneys’ fees, the Court must determinewhether the requested fees are reasonable. See Miller, supra, 447 B.R. at 434 (“For Debtors to recover attorneys’ fees, however, such fees must be reasonable and necessary”). Indeed, thepolicy to discourage willful stay violations is tempered by a reasonableness standard. Id. Whilesuch policy guards against excessive litigation, however, it was Countrywide’s actions thatcreated such substantial litigation costs to the Debtors in this case. Moreover, Countrywide has voiced no objection to the reasonableness of the fees requested by Debtors’ counsel. The Courthas reviewed the documentation in support of the requested attorneys’ fees and regards the fees to be reasonable in light of the work performed in this case.
V. Conclusion For the foregoing reasons, this Court: (i) finds that Countrywide willfully violated the automatic stay pursuant to § 362(k), (ii) awards damages to the Debtors in the form of attorneys’ fees in the amount of $85,033.814, and (iii) directs Countrywide to make payment of the award to “Francisco and Anna Rodriguez, in care of Abelson & Truesdale, LLC” within 30 days of entry of this ruling. The Court will enter an order consistent with its findings.
I got an email the other night from one of my readers. It said…
“I was hired as one of those “Independent File Review Specialist” at a company called Promontory working on Wells Fargo Bank. I have 15 years industry experience in all facets of the mortgage & title industry, and just needed a job at the moment. I must say the whole project is a mess, and a terrible joke on the victims of foreclosure and the American people. It’s a total sham.”
No kidding, I said to myself. Or, as Yves Smith would say… “Quelle surprise.” The email continued…
“I have found errors that should be moved up through the ranks, but am told “quit digging so deep”…”put your shovel away”…Focus on the questions “in scope”… The review forms are set up so no harm could ever be found. It’s equivalent of an attorney presenting his case to a judge with just 20% of the evidence.”
Well, that can’t be good, right? He went on…
“I would also like to mention that I was brought in through a temp agency…..some of the people brought in with me do not know the difference between a truth in lending statement, and a note. It’s a shame, these are your reviewers!!! The supervisors don’t want any trouble…they are mostly temps too, just trying to get a promotion to full time. Does this sound like a fair and impartial review to you? Since we’re temps I suppose that’s impartial, not to mention they made us “affiant notaries” so we can so-called “notarize each others reviews.”
Doesn’t sound “fair and impartial” in the least, now does it? But I do like the ability to notarize each other’s reviews. That sounds handier than a pocket on a man’s shirt. He closed by saying…
“The foreclosed victims don’t realize if they do not provide specific dates on the intake forms… their complaints are considered “general comments” out of scope. They should specifically ask for a “full file review” and hopefully their info has not been scrubbed or purged… I could go on and on, but I just felt I needed to share this.”
And in my opinion, you’ve done a very good thing.
Our insider says he was hired by Promontory Compliance Solutions, LLC to do work on the Independent Foreclosure Review for Wells Fargo Bank. The company’s Website describes itself as follows:
Promontory excels at helping financial companies grapple with and resolve critical issues, particularly those with a regulatory dimension. Taken as a whole, Promontory professionals have unparalleled regulatory credibility and insight, and we provide our clients with frank, proactive advice informed by evolving best practices and regulatory expectations.
Promontory is a leading strategy, risk management and regulatory compliance consulting firm focusing primarily on the financial services industry. Led by our Founder and CEO, Eugene A. Ludwig, former U.S. Comptroller of the Currency, our professionals have deep and varied expertise gained through decades of experience as senior leaders of regulatory bodies, financial institutions and Fortune 100 corporations.
DEUTSCHE BANK NATIONAL TRUST COMPANY, AS TRUSTEE FOR THE BENEFIT OF THE CERTIFICATE HOLDERS FOR ARGENT SECURITIES, INC., ASSET-BACKED PASS-THROUGH CERTIFICATES, SERIES 2006-W2, Appellee.
No. 4D10-4458.
District Court of Appeal of Florida, Fourth District.
February 22, 2012.
Lionel Barnet of the Law Offices of Lionel Barnet, P.A., Miami, for appellant.
Debra Rescigno of Robertson, Anschutz & Schneid, P.L., Boca Raton, for appellee.
PER CURIAM.
Omar Haber appeals the trial court’s entry of a final summary judgment of foreclosure in favor of Deutsche Bank National Trust Company (the bank). He argues that summary judgment was improper because the bank lacked standing to file the foreclosure suit and failed to refute his affirmative defense that the bank did not provide him with the requisite notice and opportunity to cure required an the mortgage agreement. We affirm as to the standing issue without discussion, but we reverse the final summary judgment because the bank failed to refute appellant’s affirmative defense regarding notice and opportunity to cure.
The mortgage agreement states, in pertinent part:
Lender shall give notice to Borrower prior to acceleration following Borrower’s breach of any covenant or agreement in this Security Instrument . . . The notice shall specify: (a) the default; (b) the action required to cure the default; (c) a date, not less than 30 days from the date the notice is given to Borrower, by which the default must be cured; and (d) that failure to cure the default on or before the date specified in the notice may result in acceleration of the sums secured by this Security Instrument, foreclosure by judicial proceeding and sale of the Property.
There is no evidence within the record showing that the bank provided appellant with the requisite notice and opportunity to cure.
An order granting summary judgment is reviewed de novo. Allenby & Assocs., Inc. v. Crown St. Vincent Ltd., 8 So.3d 1211, 1213 (Fla. 4th DCA 2009) (citation omitted). In order to be entitled to summary judgment, a mortgagor must refute all of the affirmative defenses of the mortgagee or show that they are legally insufficient. Woodrum v. Wells Fargo Mortg. Bank, N.A., 73 So.3d 873, 874 (Fla. 4th DCA 2011) (citing Frost v. Regions Bank, 15 So.3d 905 (Fla. 4th DCA 2009)). Because the bank failed to show that it provided appellant with the requisite notice and opportunity to cure, it was not entitled to a final summary judgment of foreclosure.
Washington, Feb 22 – Today, U.S. Reps. Ted Deutch (FL-19), Corrine Brown (FL-3), Alcee L. Hastings (FL-13), Richard Nugent (FL-5), Debbie Wasserman Schultz (FL-20), and Frederica Wilson (FL-17) sent a letter to Florida Attorney General Pam Bondi urging her to ensure that the funds awarded to Florida in the recent nationwide mortgage settlement are used for no purpose other than helping struggling homeowners and foreclosure victims. Congressman Deutch’s letter follows developments in other states where settlement money intended for foreclosure relief is being used for other purposes. In Missouri and Wisconsin, Attorneys General have diverted funds to Governors and state legislators to plug budget shortfalls, and most recently, a plan put forward in Ohio uses such funds to pay for the demolition of vacant homes.
“Given the ongoing State of Florida’s housing crisis, we strongly urge you to use these settlement funds for housing relief, and resist any efforts to divert the funds to close shortfalls in the state budget,” the Representatives write. “Data demonstrates that Florida has the third highest percentage in the country of homeowners – 44% of homeowners in the state – that are underwater. The funds from the Federal Government and State Attorneys Generals settlement with mortgage servicers can provide and should be used to provide much needed assistance to struggling homeowners.”
Homeowners best interest was never a priority in the settlement discussions… If it was, do you think any of this would be happening? Would this even be legal?
Too bad you can’t question authority because there is none.
HuffPO-
The ink wasn’t even dry on a settlement with the nation’s top mortgage lenders when Missouri Gov. Jay Nixon laid claim to a chunk of the money to avert a huge budget cut for public colleges and universities.
He’s not the only politician eyeing the cash for purposes that have nothing to do with foreclosure. Like a pot of gold in a barren field, the $25 billion deal offers a tempting and timely source of funding for state governments with multimillion-dollar budget gaps.
Although most of the money goes directly to homeowners affected by the mortgage crisis, the settlement announced this month by attorneys general in 49 states includes nearly $2.7 billion for state governments to spend as they wish.
They settle for pennies on the dollar and they don’t even pay a single penny!
HuffPO-
WASHINGTON, Feb 23 – Like many banks engulfed by the mortgage crisis, First National Bank of Nevada specialized in risky home loans that didn’t require borrowers to prove their incomes. When the housing bubble burst, First National got crushed in 2008 under the weight of bad loans that it could no longer resell to investors.
Last year, the Federal Deposit Insurance Corporation sued two former senior executives of the defunct bank for alleged negligence and breach of fiduciary duty, hoping to recover nearly $200 million in losses that it tied directly to those executives’ decisions. The two men denied wrongdoing and settled for $40 million.
Yeah, I think they finally figured out the loans are all no good. BofA will soon be DOA.
NYT-
Bank of America said Thursday that it would no longer sell new mortgages to Fannie Mae, underscoring tensions in a fight between giants of the home loan market over billions in losses in the housing bubble.
The latest move represents a major escalation in a protracted legal battle over how many defaulted mortgages Bank of America will have to buy back from Fannie because the original loans had not conformed to proper underwriting standards, market experts said.
“In mortgage circles, it’s pretty big,” said Guy Cecala, publisher of Inside Mortgage Finance, a trade publication. “It would be fairly extreme for a small or midsized lender to do this, but for a major lender, it’s very extreme.”
MERS et al. are probably going after the states that might appear easy.
Ledger-
Every time a mortgage changes hands in Kentucky, the transaction is to be registered at the county clerk’s office and a fee is to be paid.
On Thursday, Mason County joined with several other counties, including Franklin and Warren counties, across the state in a class action lawsuit against a mortgage registration company which has failed to comply with the law, which is regulated under KRS 382.110(1).
Mortgage Electronic Registration Systems, also known as MERS, is comprised of shareholders of some of the largest mortgage lending institutions in the nation.
I wouldn’t necessarily call it fail but rather prosecutors turning a blind eye on their buddies. They also didn’t fail because they never attempted to investigate.
Cynthia Kouril-
A while back, the Chief Judge in the State of New York issued an order that was a commonsense approach to robo-signing. He ordered each lawyer representing a foreclosing bank to submit an affidavit about their own investigation of their own case and the reliability of the documents they were presenting to the court. He ordered that no case could proceed until this affidavit, which would make the lawyer liable for sanctions and perjury if falsely issued, was filed with the court.
It was a great idea, though bank lawyers have resisted doing it and lower court judges have, self destructively in my opinion, been lax about enforcing it. Had they been strict in enforcement their clogged docket would be much emptier, I assure you.
Just like those things you call modifications, tenants face the same issue with toxic homes and no one to call.
NPR-
Across the country, big banks and other large investors are buying up tens of thousands of foreclosed rental properties. They’re not always model landlords, according to tenants and regulators. Some banks are failing to follow local and state housing codes, leaving tenants to live in squalor — without even a number to call in the most dire situations.
District Court of Appeal of Florida, Fifth District.
Opinion filed February 17, 2012.
Marc D. Beaumont, Port Orange, pro se.
Todd A. Armbruster of Moskowitz, Mandell, Salim & Simowitz, P.A., Fort Lauderdale, for Appellee.
PER CURIAM.
Marc D. Beaumont appeals a final summary judgment entered by the trial court on a claim to foreclose a residential mortgage and recover on a promissory note executed in connection with the mortgage. We reverse.
The final summary judgment in this case was entered in favor of Novastar Home Mortgage, Inc. (“Novastar”), a nonparty to the suit because of its prior withdrawal from the case. It is fundamental error to enter judgment in favor of a nonparty. Beseau v. Bhalani, 904 So. 2d 641 (Fla. 5th DCA 2005); Rustom v. Sparling, 685 So. 2d 90 (Fla. 4th DCA 1997). The defect, which is jurisdictional, can be raised by this Court sua sponte. Dep’t of Envtl. Prot. v. Garcia, 36 Fla. L. Weekly D1664b (Fla. 3d DCA Aug. 3, 2011).
The judgment would also have to be reversed even if entered in favor of appellee, The Bank of New York Mellon, as Successor Trustee Under Novastar Mortgage Funding Trust 2005-3 (“Mellon”). Mellon sought in the complaint to reestablish the note and recover on it. See § 673.3091, Fla. Stat. (2010). This required Mellon to show it was entitled to enforce the note when it lost the instrument, or that it directly or indirectly acquired ownership from a person who was entitled to enforce the instrument when loss of possession occurred. § 673.3091(1), Fla. Stat.[1] Mellon failed to prove who lost the note and when it was lost, offered no proof of anyone’s right to enforce the note when it was lost, and produced no evidence of ownership, due to the transfer from Novastar to Mellon.[2] See Duke v. HSBC Mortg. Servs., LLC, 36 Fla. L. Weekly D2569a (Fla. 4th DCA Nov. 23, 2011). The trial court was also required to address the issue of providing adequate protection to Beaumont against loss that might occur by reason of a claim by another person to enforce the instrument. § 673.3091(2), Fla. Stat. If Mellon has, in fact, found the note, it must produce it prior to judgment. Gee v. U.S. Bank Nat’l Ass’n, 72 So. 3d 211, 212 (Fla. 5th DCA 2011); Perry v. Fairbanks Capital Corp., 888 So. 2d 725, 726 (Fla. 5th DCA 2004); see also Feltus v. U.S. Bank Nat’l Ass’n, 37 Fla. L. Weekly D253a (Fla. 2d DCA Jan. 27, 2012).
Mellon also argues that Beaumont has waived the lack of “standing” to enforce the note because of the failure to assert this as an affirmative defense. Generally, the failure to raise standing as an affirmative defense operates as a waiver. Kissman v. Panizzi, 891 So. 2d 1147, 1150 (Fla. 4th DCA 2005) (holding lack of standing is an affirmative defense that must be raised by defendant and failure to raise it generally results in waiver). Standing involves the right to enforce the note and must exist when suit is filed. See, e.g., McLean v. JP Morgan Chase Bank Nat’l Ass’n, 36 Fla. L. Weekly D2728a (Fla. 4th DCA Dec. 14, 2011); Taylor v. Deutsche Bank Nat’l Trust Co., 44 So. 3d 618 (Fla. 5th DCA 2010). There is no evidence showing that Beaumont was on notice prior to the time his answer was filed that ownership of the note had been transferred from Novastar to Mellon. In fact, the claimed transfer, alleged to have occurred on the day suit was filed, was either concealed by Novastar for more than three years while it continued to pursue the action, or Novastar backdated the assignment it finally produced on July 23, 2010, as justification for substituting Mellon as plaintiff. Under these circumstances, Beaumont may raise lack of standing when suit was filed as a defense. See Boston Hides & Furs, Ltd. v. Sumitomo Bank, Ltd., 870 F. Supp. 1153, 1161 n.6 (D. Mass. 1994) (holding banks were not precluded from raising affirmative defense of fraud for first time on summary judgment in action alleging wrongful dishonor of letter of credit, where banks did not discover information suggesting fraud until almost one year of discovery). Furthermore, Mellon must prove its right to enforce the note as of the time the summary judgment is entered, even if Beaumont had waived the right to challenge the bank’s standing as of the date suit was filed. Venture Holdings & Acquis. Group, LLC v. A.I.M. Funding Group, LLC, 75 So. 3d 773 (Fla. 4th DCA 2011). Its failure to do so would require this Court to reverse the summary judgment entered on the note and mortgage, even if judgment had been entered in favor of Mellon.
REVERSED.
TORPY, PALMER and COHEN, JJ., concur.
[1] A negotiable instrument is enforceable by: (1) the holder of the instrument, (2) a nonholder in possession who has the rights of a holder, or (3) a person not in possession of the instrument who is entitled to reestablish a lost, destroyed or stolen instrument pursuant to section 673.3091, or who has paid or accepted a draft by mistake as described in section 673.4181. § 673.3011, Fla. Stat.
[2] The record contains a copy of an assignment of the note from Novastar to Mellon, but the document was never offered into “evidence,” by being attached to an affidavit for purposes of authentification. As such, it is not competent evidence of the assignment and cannot be considered in ruling on Mellon’s motion. See, e.g., Morrison v. U.S. Bank, N.A., 66 So. 3d 387, 387 (Fla. 5th DCA 2011) (reversing summary judgment of foreclosure where defendant asserted she had not received a notice of default as required by mortgage, and bank had simply filed an unauthenticated notice letter).
The term “Mortgage Note” or “Note” refers to the promise to pay signed by the homeowner or obligor.
The term “Mortgage” refers to the real estate security instrument (mortgage or deed of trust) that must be filed with the local land registry to perfect the rights of the holder of the note and that is subject to the Statute of Frauds.
Note that Standard Fannie and Freddie Uniform Instruments cross-reference the note and the mortgage and provide that a breach of covenants in either document provides right to accelerate balance due and declare a default.
State law determines how mortgages travel—always travel by assignment due to statute of frauds. An assignment is a conveyance of a security interest in real property.
State law governs the necessity to record assignments. Some state laws have been amended to accommodate MERS, but not that many.
Failure to record an assignment is a matter of priority and perfection if a bankruptcy is filed…
Well DOERs, John Stumpf, CEO of Wells Fargo, is a schmuck.
CEO Stumpf knew (because DOERs told him) that the only reason grandma Patricia Martin faced foreclosure was because a Wells Fargo employee–Stumpf’s employee–lied to her daughter about late fees, and then rejected her for the loan modification it told her to apply for. Why did Wells reject Grandma Martin’s modification application? Well, given the facts, I see two possibilities. Stumpf’s company is incredibly incompetent or deadly sin-level greedy. Either way Stumpf’s Wells Fargo is vicious.
New York State’s courts, frustrated by delays in thousands of foreclosure cases, are planning to speed them along in a new program that would give judges added control and require banks to send officials who have the power to alter loans to keep people in their homes.
“There will be no more excuses, no more delays,” the state’s chief judge, Jonathan Lippman, said in announcing the plan last week. “Real negotiations will take place.”
Abstract: Two parallel real estate bubbles emerged in the United States between 2004 and 2008, one in residential real estate, the other in commercial real estate. The residential real estate bubble has received a great deal of popular, scholarly, and policy attention. The commercial real estate bubble, in contrast, has largely been ignored.
This Article explores the causes of the commercial real estate bubble. It shows that the commercial real estate price bubble was accompanied by a change in the source of commercial real estate financing. Starting in 1998, securitization became an increasingly significant part of commercial real estate financing. The commercial mortgage securitization market underwent a major shift in 2004, however, as the traditional buyers of subordinated commercial real estate debt were outbid by collateralized debt obligations (CDOs). Savvy, sophisticated, experienced commercial mortgage securitization investors were thus replaced by investors who merely wanted “product” to securitize. The result was a noticeable decline in underwriting standards in commercial mortgage backed securities that contributed to the commercial real estate price bubble.
The commercial real estate bubble holds important lessons for understanding the residential real estate bubble. Unlike the residential market, there is almost no government involvement in commercial real estate. The existence of the parallel commercial real estate bubble presents a strong challenge to explanations of the residential bubble that focus on government affordable housing policy, the Community Reinvestment Act, and the role of Fannie Mae and Freddie Mac. Instead, the changes in commercial real estate financing closely mirror changes in the residential real estate financing, which shifted from regulated government-sponsored securitization to unregulated private securitization. This indicates that changes in the securitization market contributed to the problems in both the commercial and residential real estate markets.
Not surprisingly, there’s been some attempts to downplay the significance of the SF City Assessor-Recorder foreclosure audit. The attacks have come in three flavors: questions about the auditors’ own background; questions about the accuracy of the report; and the “who cares, as these are just lousy deadbeats” argument. Even if we acknowledge that there is something to each of these attacks, they don’t take away from the core finding of the report, which is that things are FUBAR in mortgage documentation, and that is going to inevitably result in some honest, but unfortunate homeowners being harmed.
The first attack is on the credentials and former activities of the auditors. Given the deeply compromised background of the OCC foreclosure review auditors, this is a chutzpadik attack. The sad truth is that there isn’t a huge pool of people who can do this sort of audit. (Yes, takes it takes a thief and all that…)
Washington, DC – Federal Housing Finance Agency (FHFA) Acting Director Edward J. DeMarco today sent to Congress a strategic plan for the next phase of the conservatorships of Fannie Mae and Freddie Mac (the Enterprises). The plan builds on the Acting Director’s February 2010 letter to Congress on the conservatorships and sets forth objectives and steps FHFA is taking or will take to meet FHFA’s obligations as conservator. Fannie Mae and Freddie Mac were placed into conservatorships Sept. 6, 2008 and have since received more than $180 billion in taxpayer support.
FHFA identifies three strategic goals for the next phase of the conservatorships:
Build. Build a new infrastructure for the secondary mortgage market;
Contract. Gradually contract the Enterprises’ dominant presence in the marketplacewhile simplifying and shrinking their operations; and
Maintain. Maintain foreclosure prevention activities and credit availability for newand refinanced mortgages.
“With the conservatorships operating for more than three years and no near-term resolution insight, it is time to update and extend the goals and directions of the conservatorships,” DeMarco wrote. “FHFA is contemplating next steps to build an infrastructure for thesecondary mortgage market that is consistent with existing policy proposals and will supportany outcome of the leading legislative proposals. FHFA looks forward to working withCongress and the Administration on a resolution of the conservatorships and a comprehensivereview of the nation’s housing finance system,” said DeMarco.
Either way the banks are screwed on these as well.
CBS-
The nation’s banks are looking at a robo-signing problem with commercial real estate which may dwarf the one for home mortgages, according to a new study.
Research by Harbinger Analytics Group shows the widespread use of inaccurate, fraudulent documents for land title underwriting of commercial real estate financing. According to the report:
This fraud is accomplished through inaccurate and incomplete filings of statutorily required records (commercial land title surveys detailing physical boundaries, encumbrances, encroachments, etc.) on commercial properties in California, many other western states and possibly throughout most of the United States.
The Massachusetts Supreme Judicial Court justices signaled last month they may rule in favor of Eaton when they asked parties in the case to submit briefs arguing whether such a decision should be applied retroactively or only to future lending. If retroactive, it would cloud the titles of the 40,000 Massachusetts properties seized in the last five years and while the ruling only applies to the state, it could serve as a model for homeowners trying to overturn foreclosures in other states.
Bloomberg-
The highest court in Massachusetts is poised to rule as soon as this month on a foreclosure case that could lead to a surge in claims from home owners seeking to overturn seizures.
The justices are deciding whether to uphold a lower court ruling that gave a Boston home back to Henrietta Eaton after Sam Levine, a 25-year-old Harvard Law School student, argued in front of the nation’s oldest appellate court that the loan servicer made mistakes when it foreclosed because it didn’t hold the note proving she was obliged to pay the mortgage.
“If the Massachusetts court says this defense works, that would have a huge ripple effect across the country,” said Kurt Eggert, a professor at Chapman University School of Law in Orange, California.
BANK OF NEW YORK MELLON TRUST COMPANY NATIONAL Appellee
v.
CORNELIU MIHALCA, et al.
EXCERPT:
BELFANCE, P. J. CONCURS IN PART, AND DISSENTS IN PART, SAYING:
{¶ 30} I concur with the majority’s conclusion that the trial court erred in granting summary judgment to the Bank. However, I respectfully dissent from the majority’s judgment that the trial court correctly denied Mr. and Mrs. Mihalca’s motion for summary judgment.
{¶ 31} In the vast majority of cases involving foreclosures, it is the bank that moves for summary judgment. As such it must demonstrate an absence of material fact as to all of the elements of its claim. Thus, it makes sense that if when the bank moves for summary judgment it cannot establish that it is the real party in interest, a genuine issue of material fact remains preventing the bank from succeeding on summary judgment. See U.S. Bank, N.A. v. Richards, 189 Ohio App.3d 276, 2010-Ohio-3981, ¶ 13 (9th Dist.). However, when the defendant in a foreclosure case moves for summary judgment, the defendant may challenge the existence of evidence which is necessary for the bank to prevail on its claim and upon which the bank has the burden of proof.
{¶ 32} In this case, the Mihalcas filed a motion for summary judgment in which they claimed that the Bank had no evidence that it was the holder of the note. The Bank had the ultimate burden to demonstrate it was the holder of the note, and in reply to the Mihalcas’ summary judgment motion, it had the reciprocal burden to present evidence establishing its entitlement to recover on the note. See Dresher v. Burt, 75 Ohio St.3d 280, 293 (1996).
[A] party seeking summary judgment, on the ground that the nonmoving party cannot prove its case, bears the initial burden of informing the trial court of the basis for the motion, and identifying those portions of the record that demonstrate the absence of a genuine issue of material fact on the essential element(s) of the nonmoving party’s claims. The moving party cannot discharge its initial burden under Civ.R. 56 simply by making a conclusory assertion that the nonmoving party has no evidence to prove its case. Rather, the moving party must be able to specifically point to some evidence of the type listed in Civ.R. 56(C) which affirmatively demonstrates that the nonmoving party has no evidence to support the nonmoving party’s claims. * * * However, if the moving party has satisfied its initial burden, the nonmoving party then has a reciprocal burden outlined in Civ.R. 56(E) to set forth specific facts showing that there is a genuine issue for trial and, if the nonmovant does not so respond, summary judgment, if appropriate, shall be entered against the nonmoving party.
(Emphasis sic.) Id.
{¶ 33} In the Mihalcas’ answer to the complaint, they denied that the Bank was the holder of the note. Moreover, in their motion for summary judgment, the Mihalcas did not simply make a conclusory assertion that the Bank could not prove its case; they specifically asserted that the Bank could not prove its case because it had not established that it was the holder of the note. They pointed to evidence that, for a number of months their counsel demanded the production and inspection of the original note and that notwithstanding, the note had not been produced. Attached to the Mihalcas’ response to the Bank’s summary judgment motion and its cross-motion for summary judgment was an affidavit by the Mihalcas’ counsel. Accompanying the affidavit, was a letter dated August 20, 2010, from the Bank’s counsel to the Mihalcas’ counsel responding to the Mihalcas’ demand for production of the note. Even viewing this letter in the light most favorable to the Bank, the letter only allows one to conclude that counsel for the Bank is going to ask the Bank for the note and that counsel believes that the Bank has possession of the original note. The letter does not affirmatively state that the Bank has possession of it. The affidavit of the Mihalcas’ counsel avers that the parties again discussed production of the original note on September 27, 2010. At that time, the Bank’s counsel stated that “they were still `looking for’ the original note.” By November 9, 2010, at the time of the Bank’s response to the Mihalcas’ motion for summary judgment, the Bank presented no evidence that it possessed or had ever possessed the original note. In addition, the Mihalcas noted that the Bank’s affidavit in support of its own summary judgment motion was improper evidence and as such, there was no proper summary judgment evidence from the Bank before the trial court on this issue.
{¶ 34} The Bank failed to meet its reciprocal burden of production, as it failed to produce evidence that demonstrated it was the holder or to produce some evidence that at least demonstrated the existence of a genuine issue of material fact as to its status. Notably, the Bank did not produce any evidentiary materials in response to the Mihalcas’ motion. Thus, it did not meet its Dresher burden, and there was no genuine dispute of material fact as to whether it was the holder of the note. Due to its failure to properly respond to the Mihalcas’ motion for summary judgment, Mr. and Mrs. Mihalca were entitled to have summary judgment in their favor. See generally HSBC Bank USA, N.A. v. Thompson, 2nd Dist. 23761, 2010-Ohio-4158. Under the circumstances, the Bank could have produced an affidavit asserting that it did possess the note or alternatively, it could have sought an extension of time to respond to the Mihalcas’ summary judgment motion so it could have then submitted proper summary judgment evidence in response to the Mihalcas’ motion.
{¶35} I can only conclude that the Bank has failed to meet its burden, as there was no evidence before the trial court that the Bank at any point in time possessed the original note. The Mihalcas were entitled to have summary judgment granted in their favor. Accordingly, I respectfully dissent from the majority’s resolution of this issue.
Someone obviously didn’t do their homework! Perhaps reading MERS 101 might help.
WSJ-
New York Attorney General Eric Schneiderman seems to think his job is to sift through the wreckage of the housing market and shoot the wounded. His latest target is electronic mortgage record-keeping, which he calls a scandal, perhaps because he doesn’t understand it.
Mr. Schneiderman is following Delaware’s Beau Biden, who sued the Mortgage Electronic Registration Systems in October, and Massachusetts’s Martha Coakley, who added banks to her suit in December. The New York complaint names many of the same institutions and alleges that MERS, as the database is known, has harmed homeowners by undermining judicial foreclosure and creating “confusion and uncertainty” about property ownership interests.
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