Fed. Home Loan Mtge. Corp. v. Trissell

2014 Ohio 1537

• Court: Ohio Court of Appeals
• Decided: April 11, 2014
• Docket: 25935
• Status: Published

Opinion

[Cite as Fed. Home Loan Mtge. Corp. v. Trissell, 2014-Ohio-1537.]

IN THE COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT MONTGOMERY COUNTY

FEDERAL HOME LOAN : MORTGAGE CORPORATION : Appellate Case No. 25935 : Plaintiff-Appellee : Trial Court Case No. 2010-CV-4131 : v. : : STANLEY L. TRISSELL, JR., et al. : (Civil Appeal from : (Common Pleas Court) Defendant-Appellant : : ........... OPINION Rendered on the 11th day of April, 2014. ...........

SCOTT A. KING, Atty. Reg. #0037582, and JESSICA E. SALISBURY-COOPER, Atty. Reg. #0085038, Austin Landing I, 10050 Innovation Drive, Suite 400, Miamisburg, OH 45342 Attorneys for Plaintiff-Appellee, Federal Home Loan Mortgage

STANLEY L. TRISSELL, JR., 7535 Turtle Creek Drive, Dayton, Ohio 45414 Defendant-Appellant, pro se

DOUGLAS TROUT, Atty. Reg. #0072027, Montgomery County Prosecutor’s Office, 301 West Third Street, 5th Floor, Dayton, Ohio 45422 Attorney for Defendant-Appellee, Montgomery County Treasurer

.............

FAIN, J.

{¶ 1} Defendant-appellant Stanley Trissell appeals from a summary judgment of 2

foreclosure rendered against him. He contends that plaintiff-appellee Federal Home Loan

Mortgage Corporation (Freddie Mac) failed to demonstrate that it was the holder of the note

securing the mortgage. He also argues that certain evidence submitted by Freddie Mac was

inadmissible and should not have been considered by the trial court.

{¶ 2} We conclude that there is competent Civ.R. 56 evidence that Trissell’s mortgage

had been assigned to Freddie Mac, thereby establishing a rebuttable presumption that the note

had also been assigned to Freddie Mac. This presumption was not rebutted. Therefore, the trial

court correctly determined that Freddie Mac was the holder of the note. Accordingly, the

judgment of the trial court is Affirmed.

I. The Underlying Transaction and the Course of Proceedings

{¶ 3} In 2001, Trissell executed a note in the amount of $159,500 in favor of Wells

Fargo Bank Home Mortgage, Inc. The note was secured by a mortgage executed the same date.

{¶ 4} In 2010, Freddie Mac brought this action in foreclosure. In its complaint,

Freddie Mac alleged that it was the holder of the note and that Trissell had defaulted. Attached

to the complaint were copies of the mortgage, the note and the recorded assignment of the

mortgage from Wells Fargo to Freddie Mac.

{¶ 5} Freddie Mac moved for summary judgment. Attached to the motion was the

affidavit of Linda Miller, in which Miller made the following averments:

1. I am a Vice President Loan Documentation for Wells Fargo Bank,

N.A., successor by merger to Wells Fargo Home Mortgage, Inc. (hereinafter

“Wells Fargo”), servicing agent for Plaintiff herein, and in that capacity I am 3

authorized to execute this Affidavit. * * *

2. The averments provided in this affidavit are within the scope of my

duties. In my position, I have access to business records, including loan

documents and loan account records maintained by Wells Fargo, and I have

personal knowledge of the operation of and the circumstances surrounding the

maintenance and retrieval of records in Wells Fargo’s record keeping system.

3. Loan account records are compiled and recorded as part of Wells

Fargo’s regularly conducted business activity at or near the time of occurrence of

each event affecting the account by persons with knowledge of said event, by or

from information transmitted by a person with knowledge of the acts and events

described within the business record. Such records are kept, maintained, and

relied upon in the course of ordinary and regularly conducted business activity.

4. I make this affidavit based upon personal knowledge obtained from my

personal review of the business records for the loan which is the subject of this

action.

5. A review of the business records reveals that on 12/14/2001, Stanley L.

Trissell, Jr., executed and delivered to Wells Fargo Home Mortgage, Inc., a certain

Note in the original amount of $159,500.00.

6. On 12/14/2001, Stanley L. Trissell, Jr., executed a Mortgage, as

security for payment on the above-described Note.

7. Plaintiff is the holder of the Note and Mortgage.

8. According to Wells Fargo’s business records, payments have not been 4

made as required under the terms of the Note and Mortgage; the default on the

loan has not been cured; and Plaintiff or its agent has accelerated the account,

pursuant to the terms of the loan, making the entire balance due. As a result of

the default on the loan and the acceleration of the debt, the total amount due to

Plaintiff through 05/24/2012 is $221,795.94. * * *

9. Wells Fargo has advanced and/or may advance funds for the payment

of reasonable and necessary real estate taxes, hazard insurance premiums, or

otherwise for protection of the property, together with court costs and other

expenses incident to this action, the total amount of which will be ascertainable at

the time of the foreclosure sale in this matter.

10. Attached as exhibits are duplicate, true and accurate copies of the

Note (Exhibit A) with any applicable indorsements and the Mortgage (Exhibit B)

with any applicable Assignments (Exhibit C) as they appear in Wells Fargo’s

Bank, N.A. business records.

{¶ 6} Exhibit C to the affidavit is a copy of the Assignment of Mortgage and Note from

Wells Fargo Bank to Freddie Mac. The assignment was executed on December 6, 2007.

{¶ 7} The trial court rendered summary judgment in favor of Freddie Mac. Trissell

appeals.

II. Because There Is Unrebutted Civ.R. 56(C) Evidence that Freddie Mac Is the Assignee

of the Mortgage, a Rebuttable Presumption Arises that Freddie Mac

Is Also the Assignee of the Note; Because this Presumption Was Not Rebutted, the Trial 5

Court Did Not Err in Finding Freddie Mac to Be the Holder of the Note

{¶ 8} Trissell’s sole assignment of error states as follows:

THE TRIAL COURT ERRED IN GRANTING SUMMARY JUDGMENT

FOR PLAINTIFF-APPELLEE, FEDERAL HOME LOAN MORTGAGE

CORPORATION (FREDDIE MAC), WHICH LACKS STANDING TO SUE.

{¶ 9} Trissell contends that Freddie Mac failed to demonstrate that it is the holder of

the note securing the mortgage, thereby failing to prove that it had standing to bring this

foreclosure action. In support, he argues that Freddie Mac failed to submit any competent

admissible evidence showing that it has possession of the note.

{¶ 10} Summary judgment is proper only when the party moving for summary

judgment demonstrates that: (1) no genuine issue of material fact exists; (2) the moving party is

entitled to judgment as a matter of law; and (3) 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 most strongly construed in that

party's favor. Civ.R. 56(C). This court reviews summary judgment de novo, meaning that we do

so independently and without deference to the trial court's findings of fact. GNFH, Inc. v. W. Am.

Ins. Co., 172 Ohio App.3d 127, 2007-Ohio-2722, 873 N.E.2d 345, ¶ 16 (2d Dist.)

{¶ 11} “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 the instrument; (2) if the movant is not the

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

conditions precedent have been met; and (5) the amount of principal and interest due.” 6

Wright-Patt Credit Union, Inc. v. Byington, 6th Dist. Erie No. E-12-002, 2013-Ohio-3963, ¶ 10,

citing U.S. Bank, N.A. v. Coffey, 6th Dist. Erie No. E-11-026, 2012-Ohio-721, ¶ 26. (Other

citation omitted.) Accord JP Morgan Chase Bank, N.A. v. Massey, 2d Dist. Montgomery No.

25459, 2013-Ohio-5620, ¶ 20.

{¶ 12} The issue presented by this assignment of error is whether Freddie Mac met its

burden on summary judgment of producing competent evidence to prove that it is the holder of

the note and the assignee of the mortgage.

{¶ 13} Trissell does not take issue with the assignment of the mortgage from Wells

Fargo to Freddie Mac. He argues that Freddie Mac did not demonstrate that it was the holder of

the note, because there is no showing that the note was assigned to it or that it was in possession

of the note.

{¶ 14} On this issue, the Eleventh District Court of Appeals, in Federal Home Loan

Mortgage Corporation v. Koch, 11th Dist. Geauga No. 2012-G-3084, 2013-Ohio-4423,¶ 36-37,

has stated:

Historically, Ohio courts have recognized that “the negotiation of a note

operates as an equitable assignment of the mortgage, even though the mortgage is

not assigned or delivered.” U.S. Bank Nat. Assn. v. Marcino, 181 Ohio App.3d

328, 2009-Ohio-1178, ¶ 52 (7th Dist.), citing Kuck v. Sommers, 100 N.E.2d 68,

75, 59 Ohio Abs. 400 (1950). In recent years, Ohio courts have extended the

application of this rule to situations in which the mortgage is assigned without an

express transfer of the note. In Bank of New York v. Dobbs, 5th Dist. Knox

No.2009-CA-000002, 2009-Ohio-4742, the Fifth Appellate District cited Section 7

5.4 of the Restatement III, Property in support of its analysis on the issue:

“The Restatement asserts as its essential premise * * * that it is nearly

always sensible to keep the mortgage and the right of enforcement of the

obligation it secures in the hands of the same party. This is because in a practical

sense separating the mortgage from the underlying obligation destroys the efficacy

of the mortgage, and the note becomes unsecured. The Restatement concedes on

rare occasions a mortgagee will disassociate the obligation from the mortgage, but

courts should reach this result only upon evidence that the parties to the transfer

agreed. Far more commonly, the intent is to keep the rights combined * * *. Thus,

the Restatement proposes that transfer of the obligation also transfers the

mortgage and vice versa. Section 5.4(b) suggests [:] ‘Except as otherwise required

by the Uniform Commercial Code, a transfer of a mortgage also transfers the

obligation the mortgage secures unless the parties to the transfer agree otherwise.’

Thus, the obligation [i.e., the note] follows the mortgage if the record indicates

the parties so intended.” (Emphasis added.) Id. at ¶ 28.

See also, HSBC Bank USA v. Sherman, 1st Dist. Hamilton No. C-120302, 2013-Ohio-4220, ¶ 15;

Wells Fargo Bank Nat’l Assn. v. Elliott, 5th Dist. Delaware No. 13 CAE 03 0012,

2013-Ohio-3690, ¶ 20-23; Bank of New York Mellon v. Matthews, 6th Dist. Fulton No. F-12-008,

2013-Ohio-1707, ¶ 15; U.S. Bank National Association v. Higgins, 2d Dist. Montgomery No.

24963, 2012-Ohio-4086, ¶ 21, remanded on other grounds, 136 Ohio St.3d 1446,

2013-Ohio-3210, 993 N.E.2d 253.

{¶ 15} Copies of the note, the mortgage, and the assignment of the mortgage were 8

attached both to the complaint and to Miller’s affidavit in support of the motion for summary

judgment. The mortgage and the assignment thereof bear notary seals, which make them

self-authenticating. Lorain Cty. Bar Assn. v. Kennedy, 95 Ohio St.3d 116, 766 N.E.2d 151

(2002); Evid.R. 902(8). The note makes reference to the mortgage, and the mortgage makes

reference to the note. Furthermore, the assignment of mortgage specifically states that it is

assigned along with the note. This cross-referencing between the instruments is sufficient to

establish a rebuttable presumption of intent to convey both the mortgage and note to Freddie

Mac. Trissell submitted no Civ.R. 56 evidence to rebut this presumption. Therefore, the trial

court did not err in finding that Freddie Mac was the holder of the note. Trissell does not dispute

that he is in default on the note.

{¶ 16} The trial court did not err in rendering summary judgment. Trissell’s sole

assignment of error is overruled.

III. Conclusion

{¶ 17} Trissell’s sole assignment of error having been overruled, the judgment of the

trial court is Affirmed.

HALL, J., concurs.

DONOVAN, J., concurs in judgment only.

Copies mailed to:

Scott A. King Jessica E. Salisbury-Cooper Stanley L. Trissell, Jr. [Cite as Fed. Home Loan Mtge. Corp. v. Trissell, 2014-Ohio-1537.] Douglas Trout Hon. Frances E. McGee