CitiMortgage, inc. v. Hijjawi

2014 Ohio 2886

• Court: Ohio Court of Appeals
• Decided: June 30, 2014
• Docket: 2013-L-105
• Status: Published

Opinion

[Cite as CitiMortgage, inc. v. Hijjawi, 2014-Ohio-2886.]

IN THE COURT OF APPEALS

ELEVENTH APPELLATE DISTRICT

LAKE COUNTY, OHIO

CITIMORTGAGE, INC., SUCCESSOR BY : OPINION MERGER TO PRINCIPAL RESIDENTIAL MORTGAGE, INC., : CASE NO. 2013-L-105 Plaintiff-Appellee, :

- vs - :

SUSAN M. HIJJAWI, et al., :

Defendants-Appellants. :

Civil Appeal from the Lake County Court of Common Pleas, Case No. 11 CF 002676.

Judgment: Affirmed.

Harry W. Cappel and Jeffrey M. Hendricks, Graydon Head & Ritchey LLP, 1900 Fifth Third Center, 511 Walnut Street, Cincinnati, OH 45202-3157 (For Plaintiff-Appellee).

David N. Patterson, 33579 Euclid Avenue, Willoughby, OH 44094-3199 (For Defendants-Appellants).

TIMOTHY P. CANNON, P.J.

{¶1} Appellants, Susan M. Hijjawi and Waseem Hijjawi, appeal the September

30, 2013 judgment of the Lake County Court of Common Pleas granting summary

judgment and issuing a decree of foreclosure in favor of appellee, CitiMortgage Inc.,

successor by merger to Principal Residential Mortgage, Inc. For the reasons that

follow, we affirm the decision of the trial court. {¶2} In December 1997, appellants took title to a property at 6363 Clearair

Drive, Mentor, Ohio. Appellants signed a promissory note in favor of Real Estate

Mortgage Corp. Appellants also granted a mortgage on the property to Real Estate

Mortgage Corp. The record reveals that the note was assigned four different times; the

note was finally assigned to Principal Residential Mortgage, Inc., which merged into

CitiMortgage, Inc. (“CitiMortgage”). On December 24, 1997, the mortgage was

assigned from Real Estate Mortgage Corp. to Principal Residential Mortgage. The

mortgage was recorded in the Lake County Recorder’s Office.

{¶3} Appellee filed a complaint for foreclosure on October 7, 2011, alleging that

it is the holder of the note which is secured by a mortgage. Appellee attached both the

note and the mortgage to the complaint.

{¶4} Appellee sought summary judgment. In support of its motion, appellee

submitted the affidavit of Crystal Berry, Document Control Officer for appellee. The

affidavit states she has access to appellee’s business records and she has reviewed the

records related to appellants’ account. Ms. Berry averred that the documents she

reviewed and “relied upon for the statements made in the affidavit include but are not

limited to the Note, Mortgage and Citimortgage Inc.’s electronic servicing system.” The

affidavit states that appellee is the holder of the note and mortgage executed by

appellants. Further, appellants defaulted under the terms of the note and mortgage,

and the loan balance has been accelerated in accordance with the notes of the loan

documents. Ms. Berry states that appellants owe the principal sum of $133,406.31,

plus interest at 4.6250% per annum from May 1, 2011. Ms. Berry provided a

breakdown of the advanced costs.

2 {¶5} Appellants filed a memorandum in opposition to appellee’s motion for

summary judgment without the support of an affidavit or any other evidentiary material.

Appellants, however, argued that appellee failed to establish itself as the holder of the

note prior to filing its complaint; that appellee failed to support its motion with sufficient

evidence establishing default and the total debt on the loan documents; and that

appellee failed to provide appellants with advance notice of its intent to accelerate the

loan debt.

{¶6} The trial court granted appellee’s motion for summary judgment.

{¶7} Appellants filed a timely notice of appeal and assert the following

assignment of error for our review:

{¶8} “Reviewing the Appellee’s Motion for Summary Judgment de novo, the

Record is clear and convincing that the trial court erred to the prejudice of Appellants by

granting Appellee’s Motion for Summary Judgment in favor of Appellee on the

foreclosure Complaint.”

{¶9} Appellants frame four issues for our review. First, appellants contend the

affidavit “was insufficient to warrant summary judgment and should not have been

considered by the lower court in analyzing the motion for summary judgment.” Second,

appellants argue that appellee was not the real party in interest. Third, appellants

maintain they were not provided the condition precedent of providing notice of the

default and notice of acceleration. Fourth, appellants argue that appellee failed to prove

damages.

3 {¶10} We review a trial court’s decision on a motion for summary judgment de

novo. Fed. Home Loan Mortg. Corp. v. Zuga, 11th Dist. Trumbull No. 2012-T-0038,

2013-Ohio-2838, ¶13. Under Civil Rule 56(C), summary judgment is proper if:

(1) No genuine issue as to any material fact remains to be litigated; (2) the moving party is entitled to judgment as a matter of law; and (3) it appears from the evidence that reasonable minds can come to but one conclusion, and viewing such evidence most strongly in favor of the party against whom the motion for summary judgment is made, that conclusion is adverse to that party.

Id. at ¶10-11, citing Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977).

{¶11} The moving party bears the initial burden to demonstrate from the

pleadings, depositions, answers to interrogatories, written admissions, affidavits,

transcripts of evidence, and written stipulations of fact, if any, that there is no genuine

issue of material fact to be resolved in the case. Id. at ¶12. To properly support a

motion for summary judgment in a foreclosure action, a plaintiff must present

evidentiary-quality materials showing: (1) the movant is the holder of the note and

mortgage, or is a party entitled to enforce it; (2) if the movant is not the original

mortgagee, the chain of assignments and transfers; (3) the mortgager is in default; (4)

all conditions precedent have been met; and (5) the amount of principal and interest

due. Wachovia Bank v. Jackson, 5th Dist. Stark No. 2010-CA-00291, 2011-Ohio-3203,

¶40-45. With regard to the first requirement, the movant must establish it was the

holder or entitled to enforce the note as of the time the complaint was filed. Fed. Home

Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, ¶3. “If this

initial burden is met, the nonmoving party then bears the reciprocal burden to set forth

specific facts which prove there remains a genuine issue to be litigated, pursuant to

Civ.R. 56(E).” Zuga, supra, ¶12.

4 {¶12} First, appellants maintain the affidavit of Crystal Berry was “without

credibility and should not [have been] considered for summary judgment purposes.”

Pursuant to Civ.R. 56(E), affidavits “shall be made on personal knowledge, shall set

forth such facts as would be admissible in evidence, and shall show affirmatively that

the affiant is competent to testify to the matters stated in the affidavit.” “Copies of all

papers referred to in the affidavit are acceptable if the affidavit indicated that the copies

submitted are true and accurate reproductions of the originals.” Zuga, supra, ¶15.

{¶13} In M & T Bank v. Strawn, 11th Dist. Trumbull No. 2013-T-0040, 2013-

Ohio-5845, this court analyzed whether an affidavit was sufficient to establish the

affiant’s personal knowledge. In Strawn, this court outlined the averments made by the

affiant, which included that he had personal knowledge and that the business records

were “created at or near the time of the relevant occurrences.” Id. at ¶20. The affiant

also attached copies of the note, mortgage, and demand letter and averred that they

were true and accurate. This court did not find error in the trial court’s finding that the

affiant had personal knowledge. Id.

{¶14} Similarly, in this case, Ms. Berry averred that she had personal knowledge

of the statements made in the affidavit; that she has access to the business records of

CitiMortgage; and that she reviewed appellants’ records, which were maintained by

appellee in the course of its regularly conducted business activities and were made at or

near the time of the event. Attached to Ms. Berry’s affidavit were what she attested to

be true and accurate copies of the note and mortgage, each depicting the chain of

assignments to appellee. Consequently, Ms. Berry’s affidavit is sufficient for the trial

court to have determined that the affiant had personal knowledge.

5 {¶15} Under their second issue for review, appellants maintain that appellee did

not have standing to bring this action. “Standing is a jurisdictional requirement which

must be met before a common pleas court can proceed.” Fed. Home Loan Mortg. Corp.

v. Koch, 11th Dist. Geauga No. 2012-G-3084, 2013-Ohio-4423, ¶24, citing

Schwartzwald at ¶22. The mortgage lender must demonstrate an interest in either the

mortgage or promissory note to establish standing; this interest must exist at the time

the foreclosure complaint was filed in the trial court. Koch at ¶24, citing Schwartzwald

at ¶25-27.

{¶16} The note and mortgage, which are in evidence, depicted the assignments

to appellee. Further, the assignment to Principal Residential Mortgage, Inc., which

merged into CitiMortgage, occurred prior to the filing of the complaint. See R.C.

5301.32. The holder of an instrument is a “person entitled to enforce” the instrument

under R.C. 1303.31. R.C. 1301.201(B)(21)(a) defines a holder of a negotiable

instrument as “[t]he person in possession of a negotiable instrument that is payable

either to bearer or to an identified person that is the person in possession.” The

evidence also established that CitiMortgage was in possession of the note and entitled

to enforce it at the time the complaint was filed. See Citimortage, Inc. v. Patterson, 8th

Dist. Cuyahoga No. 98360, 2012-Ohio-5894, ¶21 (holder of note has standing to

foreclose).

{¶17} Under the third issue for review, appellants contend they were not

provided proper notice of their default. Appellants’ contentions are not supported by the

record. In the complaint, appellee made a general allegation that it had complied with

all conditions precedent for foreclosure. “Where prior notice of default and/or

6 acceleration is required by a provision in a note or mortgage instrument, the provision of

notice is a condition precedent subject to Civ.R. 9(C).” First Fin. Bank v. Doellman, 12th

Dist. Butler No. CA2006-02-029, 2007-Ohio-222, ¶20. In this case, appellee, by stating

generally that it had complied with all conditions precedent, met the requirements of

Civ.R. 9(C). The record also contains a demand letter from CitiMortgage to appellants,

dated July 7, 2011. Such letter informed appellants that they were in default, and to

“prevent [appellee] from instituting foreclosure proceedings, we must receive $2,371.94,

including $46.07 in late charges and $0.00 in delinquency related expenses * * * by

08/04/11.” The letter further stated, “[f]ailure to cure the default by 08/04/11, may result

in the acceleration of all sums due under the Security Instrument. This means the entire

unpaid balance will become due.” The letter evidences that appellants were aware of

their right to cure the default and the manner in which the default could be cured.

{¶18} Under their fourth issue for review, appellants argue that appellee failed to

sufficiently establish entitlement to damages. We do not agree.

{¶19} Appellee submitted the affidavit of Ms. Berry, which averred that

appellants defaulted under the terms of the note and mortgage, the loan balance

accelerated in accordance with the loan documents, and that appellants owed the

principal sum of $133,406.31, plus interest at 4.6250% per annum from May 1, 2011.

Additionally, although not required by law, appellee attached an account history

establishing the balance owing on the delinquent account. See Deutsche Bank Natl.

Trust Co. v. Najar, 8th Dist. Cuyahoga No. 98502, 2013-Ohio-1657, ¶40 (stating no

requirement for plaintiff to submit a payment history to demonstrate entitlement to

summary judgment.)

7 {¶20} As discussed above, CitiMortgage provided all the evidentiary material

necessary to satisfy all the foregoing criteria. At this point, the burden shifted to

appellants to set forth specific facts demonstrating that a genuine issue of material fact

remained to be litigated. Appellants, however, failed to meet its reciprocal burden by

submitting evidence that would create a genuine issue of material fact for trial.

Therefore, we conclude the trial court did not err in ruling that CitiMortgage was entitled

to summary judgment as a matter of law.

{¶21} Appellants’ assignment of error is without merit.

{¶22} For the reasons discussed in this opinion, the judgment of the Lake

County Court of Common Pleas is hereby affirmed.

DIANE V. GRENDELL, J., concurs,

COLLEEN MARY O’TOOLE, J., concurs in judgment only.