Michael Rae and Amy M. Rae (Molson) v. Ventures Trust 2013-I-NH by MCM Capital Partners, LLC, Its Trustee, Bank of America, N.A., Franklin American Mortgage Company (mem. dec.)

• Court: Indiana Court of Appeals
• Decided: July 10, 2017
• Docket: 37A03-1612-PL-2874
• Status: Published

Opinion

MEMORANDUM DECISION Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before any FILED court except for the purpose of establishing Jul 10 2017, 5:47 am the defense of res judicata, collateral CLERK estoppel, or the law of the case. Indiana Supreme Court Court of Appeals and Tax Court

APPELLANTS PRO SE ATTORNEYS FOR APPELLEE Michael Rae VENTURES TRUST 2013-I-NH BY Demotte, Indiana MCM CAPITAL PARTNERS, LLC, ITS TRUSTEE Amy M. Molson (Rae) Phillip A. Norman Lake Village, Indiana Jennifer L. Snook Valparaiso, Indiana

ATTORNEYS FOR APPELLEES BANK OF AMERICA, N.A., AND MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. Darren A. Craig Bryan S. Strawbridge Frost Brown Todd LLC Indianapolis, Indiana

IN THE COURT OF APPEALS OF INDIANA

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 1 of 12 Michael Rae and Amy M. Rae July 10, 2017 (Molson), Court of Appeals Case No. Appellants, 37A03-1612-PL-2874 Appeal from the Jasper Circuit v. Court The Honorable John D. Potter, Ventures Trust 2013-I-NH by Judge MCM Capital Partners, LLC, Its Trial Court Cause No. Trustee, Bank of America, N.A., 37C01-1503-PL-236 Franklin American Mortgage Company, and Mortgage Electronic Registration Systems, Inc., Appellees

Crone, Judge.

Case Summary [1] Michael Rae and Amy M. Rae (Molson) (collectively “the Raes”) bring a pro se

appeal from the trial court’s entry of summary judgment and decree of

foreclosure in favor of Ventures Trust 2013-I-NH by MCM Capital Partners,

LLC, its trustee (“Ventures Trust”). Finding that no genuine issue of material

fact remains and that the judgment of foreclosure is appropriate as a matter of

law, we affirm.

Facts and Procedural History [2] The designated evidence indicates that in August 2008, the Raes executed a

promissory note in favor of Franklin American Mortgage Company in the

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 2 of 12 amount of $176,102. The note was secured by a mortgage on certain real

property located in Jasper County (“the Property”). The mortgage was

executed in favor of Mortgage Electronic Registration Systems, Inc. (“MERS”),

as nominee for Franklin American, and the mortgage was recorded with the

Jasper County Recorder’s Office on August 8, 2008. The mortgage was

subsequently assigned to Bank of America, N.A., as successor by merger to

BAC Home Loans Servicing, LP, f/k/a Countrywide Home Loans Servicing,

LP, and the assignment was recorded with the Jasper County Recorder’s Office

on June 13, 2012. The mortgage was then assigned to Newbury REO 2013,

LLC, and the assignment was recorded with the Jasper County Recorder’s

Office on September 13, 2013. On August 27, 2015, a corrective assignment of

mortgage was recorded with the Jasper County Recorder’s Office. The

corrective assignment corrected the assignee of the mortgage from Newbury

REO to Ventures Trust.

[3] As for the promissory note, the evidence indicates that the original holder of the

note, Franklin American, executed an endorsement to the note to Countrywide

Bank, FSB. Countrywide Bank then executed an endorsement to the Secretary

of Housing and Urban Development of Washington, D.C. and his/her

successors and assigns. An allonge to the note was subsequently executed

which indicated a transfer of interest in the note to Newbury REO and then to

Ventures Trust.

[4] On March 25, 2015, Michael filed a pro se complaint to quiet title to the

Property because, in his own words, “he had no idea who owned or had rights

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 3 of 12 to his [m]ortgage.” Appellants’ Supp. App. Vol. 3 at 15. He named numerous

defendants including Ventures Trust, Bank of America, MERS, Franklin

American, Newbury REO, Asset Acceptance, LLC, Viking Funding Group,

and Town of Demotte. Newbury REO filed an answer stating that it owned the

mortgage and note. On September 8, 2015, after the corrective assignment of

mortgage had been recorded indicating that Ventures Trust was the proper

assignee of the mortgage, Ventures Trust filed its answer to Michael’s complaint

and a counterclaim for foreclosure of its mortgage. Ventures Trust asserted its

ownership rights to the mortgage and note, naming as counterdefendants the

Raes, Bank of America, Asset Acceptance, Viking Funding Group, Capital One

Bank (USA), and the State of Indiana, Department of Revenue.

[5] On October 9, 2015, Bank of America filed a disclaimer of interest as to the

Property.1 Thereafter, on January 4, 2016, without seeking leave of court,

Michael filed a “Third-Party Claim of Wrongful Foreclosure” against Bank of

America. Bank of America filed a motion to dismiss the third-party claim on

January 19, 2016, which was subsequently granted by the trial court.

[6] In February 2016, Ventures Trust filed its motion for summary judgment and

request for decree of foreclosure and designated an affidavit of debt indicating

the Raes’ mortgage default debt in the amount of $224,848.60. In addition to

1 On October 15, 2015, Ventures Trust filed an “Affidavit in Aid of Title to Correct Scrivener’s Error” and recorded the correction with the Jasper County Recorder’s Office. The affidavit was to correct a scrivener’s error in the notary paragraph of the corrective assignment of mortgage to Ventures Trust.

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 4 of 12 the pleadings, Ventures Trust designated a copy of the original promissory note

signed by the Raes, the allonge, the mortgage, and all assignments thereto.

[7] On November 16, 2016, the trial court granted summary judgment and entered

a decree of foreclosure and judgment against the Raes in favor of Ventures

Trust. Specifically, the trial court concluded that the designated evidence

established that Ventures Trust is the holder and owner of the promissory note

and mortgage on the Property, and that Ventures Trust was entitled to foreclose

its mortgage as a lien against the Property to satisfy the debt secured by the

mortgage. Therefore, the trial court entered judgment against Amy and an in

rem judgment against Michael in the sum of $224,848.60, and ordered the

Property sold to satisfy the judgment. On December 8, 2016, Amy alone filed

a pro se motion to vacate the judgment of foreclosure, which was denied by the

trial court on December 14, 2016. Thereafter, the Raes filed a pro se joint

notice of appeal, attaching only the trial court’s summary judgment order and

decree of foreclosure as the appealed order.

Discussion and Decision [8] We begin by noting that the Raes represented themselves at the trial level and

do so again on appeal. Although individuals have a right to represent

themselves in legal proceedings, pro se litigants are held to the same standards

as trained attorneys and are afforded no inherent leniency simply by virtue of

being self-represented. Zavodnik v. Harper, 17 N.E.3d 259, 266 (Ind. 2014). This

means that pro se litigants are bound to follow the established rules of

procedure and must be prepared to accept the consequences of their failure to Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 5 of 12 do so. Basic v. Amouri, 58 N.E.3d 980, 983-84 (Ind. Ct. App. 2016). We will

not become an “‘advocate for a party, or address arguments that are

inappropriate or too poorly developed or expressed to be understood.’” Id.

(quoting Perry v. Anonymous Physician 1, 25 N.E.3d 103, 105 n.1 (Ind. Ct. App.

2014), trans. denied (2015), cert. denied).2

[9] The Raes appeal the trial court’s entry of summary judgment in favor of

Ventures Trust. Summary judgment is appropriate only when there is no

genuine issue of material fact and the moving party is entitled to judgment as a

matter of law. Wagner v. Yates, 912 N.E.2d 805, 808 (Ind. 2009). We review

the trial court’s grant of a summary judgment de novo, drawing all reasonable

inferences in favor of the nonmoving party. Hughley v. State, 15 N.E.3d 1000,

1003 (Ind. 2014). Still, the nonmoving party has the burden on appeal of

persuading us that the grant of summary judgment was erroneous. Id. Further,

“we will affirm the trial court’s ruling based on any theory supported by the

record evidence.” Markley v. Estate of Markley, 38 N.E.3d 1003, 1006-07 (Ind.

2015).

2 We note that it is difficult to discern the Raes’ precise allegations because of the many deficiencies in their briefs on appeal, especially their failure to comply with Indiana Appellate Rule 46 regarding the arrangement of their briefs, as well as the fact that their briefs are completely devoid of any citations to the appendices. See generally Ind. Appellate Rule 46(A) and (C) (entitled Appellant’s Brief and Appellant’s Reply Brief). Although we do our best here to address the merits of their claims where possible, in some instances our appellate review has been so impeded that waiver of some issues is unavoidable. See In re Moeder, 27 N.E.3d 1089, 1097 n.4 (Ind. Ct. App. 2015) (while failure to comply with appellate rules does not necessarily result in waiver of the issues presented, it is appropriate where noncompliance impedes our review), trans. denied.

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 6 of 12 Section 1 – The Raes have not met their burden to persuade us that the trial court erred in entering summary judgment and a decree of foreclosure in favor of Ventures Trust. [10] Indiana Code Section 32-30-10-3(a) provides, “if a mortgagor defaults in the

performance of any condition contained in a mortgage, the mortgagee or the

mortgagee’s assign may proceed in the circuit court of the county where the real

estate is located to foreclose the equity of redemption contained in the

mortgage.” To establish a prima facie case that it is entitled to foreclose upon a

mortgage, the mortgagee or its assign must enter into evidence the demand note

and the mortgage, and must prove the mortgagor’s default. McEntee v. Wells

Fargo Bank, N.A., 970 N.E.2d 178, 182 (Ind. Ct. App. 2012). “Once the

mortgagee establishes its prima facie case, the burden shifts to the mortgagor to

show that the note has been paid in full or to establish any other defenses to the

foreclosure.” Id.

[11] Moreover, “Indiana has adopted Article 3 of the Uniform Commercial Code

which governs negotiable instruments, and it is well established that a

promissory note secured by a mortgage is a negotiable instrument.” Lunsford v.

Deutsche Bank Trust Co. Americas, 996 N.E.2d 815, 821 (Ind. Ct. App. 2013).

Specifically, Indiana Code Section 26-1-3.1-301 provides that a negotiable

instrument may be enforced by “the holder of the instrument.” The term

“holder” includes the person in possession of a negotiable instrument that is

payable to “bearer” or a person in possession of a negotiable instrument

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 7 of 12 “payable to bearer or endorsed in blank.” Ind. Code § 26-1-1-201(5), -

201(20)(A).

[12] Here, Ventures Trust made a prima facie showing that it is the holder of the

note and mortgage on the Property and is entitled to a judgment of foreclosure.

Ventures Trust produced a certified copy of the original promissory note with

the Raes’ signatures and the endorsements to that note, including the allonge

endorsing the note to Ventures Trust. Ventures Trust further designated copies

of the original mortgage documents and the chain of assignment, as well as an

affidavit of the Raes’ default and debt.

[13] In response, Michael did not dispute that the Raes are in default under the

terms of the note and mortgage, nor did he dispute the amount of

indebtedness.3 Rather, he asserted that there is a discrepancy between the copy

of the promissory note attached to the complaint of foreclosure and the copy

attached to the motion for summary judgment, that the endorsements on the

3 Rather than challenging the fact of their default or the amount of their indebtedness, the Raes simply maintain that the affidavit of debt by affiant Bethany Neel is inadmissible because “it fails to meet T.R. 11(B) because it does not contain (signed under the penalty of perjury) as required by the rule.” Appellants’ Br. at 14. Indiana Trial Rule 11(B) requires that an affidavit be “verified by affirmation or representation” and provides guidance as to what language may constitute proper verification. Gary/Chicago Airport Bd. of Auth. v. Maclin, 772 N.E.2d 463, 472 (Ind. Ct. App. 2002). The Raes acknowledge that strict compliance with Trial Rule 11 is not required, and that the chief test of the sufficiency of an affidavit is its ability to serve as a predicate for a perjury prosecution. Jordan v. Deery, 609 N.E.2d 1104, 1110 (Ind. 1993). Indeed, affidavits used for summary judgment purposes “are evidential in nature” and thus they must be subject to the penalties of perjury. See Tannehill by Podgorski v. Reddy, 633 N.E.2d 318, 321 (Ind. Ct. App. 1994), trans. denied. Accordingly, an affidavit provided in support of a motion for summary judgment must be verified by an oath or affirmation. Id. Neel’s notarized affidavit provides that the representations contained therein were “affirm[ed] under oath” and “certif[ied]” as “true and correct” “[u]nder the penalties as provided by law.” Ventures Trust’s App. at 59, 61. We conclude that Neel’s affidavit was properly verified by oath or affirmation, and therefore admissible.

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 8 of 12 second copy are “photoshop[ped],” that his and Amy’s signatures on both

copies are forgeries, and further that “[t]he chain of mortgage assignments is in

dispute because everyone [sic] is faulty or fraudulently endorsed or conveyed in

some way.” Appellants’ Supp. App. Vol. 3. at 20; Summary Judgment Hearing

Tr. at 10-11. However, these assertions are not enough to create a genuine

issue of material fact.

[14] As far as the discrepancy between the copies of the promissory note, we

disagree with the Raes that such discrepancy supports a reasonable inference

that Ventures Trust is not the holder of the note and mortgage or that either are

the product of “forgery and fraud.” Reply Br. at 6. It is undisputed that

Ventures Trust produced what the trial court determined was a certified copy of

the original promissory note, including the allonge and endorsement to

Ventures Trust, for inspection at the time it moved for summary judgment and

again at the summary judgment hearing. “There exists no better evidence to

establish that [Ventures Trust] is the present holder of the note entitled to

enforce the note under Indiana law.” Collins v. HSBC Bank USA, Nat’l Ass’n, 974

N.E.2d 537, 542 (Ind. Ct. App. 2012). Further, as stated above, Ventures Trust

produced evidence of a clear chain of title to the mortgage and its assignments.

This evidence was sufficient to establish that Ventures Trust is the holder of the

note and mortgage and entitled to enforce the loan documents. See Lunsford,

996 N.E.2d at 821.

[15] In considering whether the nonmovant for summary judgment has created a

genuine issue of fact, only “[r]ational assertions of fact and reasonable

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 9 of 12 inferences therefrom are deemed to be true.” Ramon v. Glenroy Constr. Co., 609

N.E.2d 1123, 1132 (Ind. Ct. App. 1993), trans. denied. We conclude that the

Raes’ bald assertions of fraud and forgery did not create a genuine issue of

material fact for trial. Accordingly, the Raes have not met their burden to

persuade us that the trial court erred in entering summary judgment and a

decree of foreclosure in favor of Ventures Trust.

Section 2 – The Raes have waived our review of their challenge to two subsequent trial court orders. [16] Although the Raes appeal only the trial court’s November 16, 2016, entry of

summary judgment and decree of foreclosure, they also attempt to challenge the

trial court’s subsequent orders denying Amy’s motion to set aside and granting

Bank of America and MERS’ motion to dismiss third-party claim. They have

waived appellate review of these orders.

[17] Regarding Amy’s motion to set aside, as we have already noted, the current

appeal addresses only the trial court’s entry of summary judgment and decree of

foreclosure in favor of Ventures Trust. Neither Amy individually nor the Raes

collectively appealed the trial court’s order denying Amy’s motion to set aside,

and the Raes did not designate the court’s order denying the motion to set aside

as an appealable order in their current notice of appeal. See Ind. Appellate Rule

9(F) (requiring that notice of appeal include designation of appealed order or

judgment). To make matters worse, it appears that the Raes failed to include a

copy of Amy’s motion to set aside in the record on appeal. On a motion to set

aside, the burden is on the movant to establish sufficient grounds for relief.

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 10 of 12 Front Row Motors, LLC v. Jones, 5 N.E.3d 753, 758 (Ind. 2014). Here, we are

unable to discern the basis of the motion and we have no idea what credible

evidence, if any, Amy presented to the trial court in support of the motion.4

[18] It is well settled that the appellant bears the burden of presenting a complete

record with respect to the issues raised on appeal. Shoemaker v. Ind. State Police

Dep’t, 62 N.E.3d 1242, 1245 (Ind. Ct. App. 2016), trans. denied (2017). Further,

pursuant to Indiana Appellate Rule 46(A)(8)(a), the contentions of the appellant

on the issues presented “must be supported by citations to the authorities,

statutes, and the Appendix or parts of the Record on appeal relied on ….” The

Raes have failed to do both of these things with respect to Amy’s motion to set

aside. Therefore, the issue is waived. York v. Fredrick, 947 N.E.2d 969, 979

(Ind. Ct. App. 2011), trans. denied.

[19] Additionally, the Raes briefly mention that the trial court also erred in

“dismissing the third-party claims” against Bank of America and MERS.

Appellants’ Br. at 21. Thus, Bank of America and MERS felt compelled to

submit an appellees’ brief to address what they believe to be the Raes’ waiver of

this issue. The record indicates that in January 2016, Michael filed a “Third-

Party Claim of Wrongful Foreclosure” against Bank of America alleging,

among other things, that Bank of America had prepared “fraudulent and

deceptive paperwork” and that the court should “question anything filed or to

4 On appeal, the Raes argue that the trial court lacked personal jurisdiction over Amy due to lack of service of process, and we presume that this is the argument upon which her motion to vacate was premised.

Court of Appeals of Indiana | Memorandum Decision 37A03-1612-PL-2874| July 10, 2017 Page 11 of 12 do with Bank of America [or MERS] in the chain of title” to the Property.

Bank of America and MERS App. Vol. 2 at 9, 12. Bank of America and MERS

filed a motion to dismiss and, on December 9, 2016, the trial court entered an

order dismissing Michael’s third-party claim for noncompliance with the

Indiana Rules of Trial Procedure and for failure to state a claim upon which

relief could be granted. The trial court’s order of dismissal is not mentioned in

the notice of appeal or included in the record on appeal and, other than briefly

mentioning the dismissal in their brief, the Raes develop no argument and cite

to no authority as to why it was erroneous. Accordingly, we conclude the issue

is waived and we decline to address it further. See York, 947 N.E.2d at 979.

The judgment of the trial court is affirmed.

[20] Affirmed.

Baker, J., and Barnes, J., concur.

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