Troon Mgt., Ltd. v. Adams Family Trust

2023 Ohio 3489, 225 N.E.3d 463

• Court: Ohio Court of Appeals
• Decided: September 28, 2023
• Docket: 22CA19
• Status: Published

Opinion

[Cite as Troon Mgt., Ltd. v. Adams Family Trust, 2023-Ohio-3489.]

IN THE COURT OF APPEALS OF OHIO FOURTH APPELLATE DISTRICT PICKAWAY COUNTY

Troon Management, Ltd., : Case No. 22CA19

Plaintiff-Appellee, :

v. : DECISION AND JUDGMENT ENTRY The Adams Family Trust, et al., :

Defendants-Appellants. : RELEASED 9/28/2023

______________________________________________________________________ APPEARANCES:

Barton R. Keyes, Cooper Elliott, Columbus, Ohio, for appellants The Adams Family Trust and Bret Adams.

Brian S. Stewart, The Law Office of Brian Stewart, LLC, Circleville, Ohio, for appellee Troon Management, Ltd. ______________________________________________________________________ Hess, J.

{¶1} The Adams Family Trust (“AFT”) and Bret Adams (collectively, “Appellants”)

appeal from a judgment of the Pickaway County Court of Common Pleas in favor of Troon

Management, Ltd. (“Troon”) in its action for declaratory judgment/quiet title and slander

of title. The Appellants present four assignments of error asserting that the trial court

erred by (1) granting Troon summary judgment on the declaratory judgment/quiet title

claim and denying AFT summary judgment on that claim and the slander of title claim, (2)

denying the Appellants’ motion for reconsideration, (3) denying Mr. Adams summary

judgment on the slander of title claim, and (4) finding in favor of Troon on the slander of Pickaway App. No. 22CA19 2

title claim and entering judgment in favor of Troon and against them. For the reasons

which follow, we overrule the assignments of error and affirm the trial court’s judgment.

I. FACTS AND PROCEDURAL HISTORY

A. Background

{¶2} Diane Adams is trustee of AFT, which once owned two parcels of real

property in Circleville, Ohio, which we will refer to as the “Route 56 Farm.” Troon lent

money to Bret Adams, Mrs. Adams’ husband, and AFT provided collateral in the form of

a deed to the Route 56 Farm. Mr. Adams and AFT made no payments towards the debt.

AFT later denied that Troon’s title to the farm was valid, and Troon filed suit against AFT

in Pickaway County Case No. 2018 CI 0027. The trial court ruled in Troon’s favor and

held it was the title owner of the farm.

{¶3} At that time, there were two mortgages encumbering the Route 56 Farm,

one of which was held by Kristina B. Gerig (the “Gerig Mortgage”). The Gerig Mortgage

secured a promissory note in favor of Gerig (the “Gerig Note”) signed by (1) Mrs. Adams

as trustee of AFT; (2) Mr. Adams individually; (3) Mr. Adams as agent of FM2, LLC; and

(4) Mr. Adams as agent of CAM Development Company, Ltd. The note states that the

signatories “jointly and severally, promise to pay to” Gerig “the principal sum of Four

Hundred and Seventy-One Thousand Eight Hundred and Forty-Three Dollars and 78/00

($478,843.78) within ten days of” her demand “but not earlier than January 1, 2016” and

contains interest provisions. Gerig and AFT later agreed there was a scrivener’s error

regarding the principal sum, and the amount expressed in words was correct, not the

amount expressed in numbers. Pickaway App. No. 22CA19 3

{¶4} On October 4, 2019, Troon and AFT executed an agreement, which we will

refer to as the “Troon-AFT Settlement Agreement,” in which AFT agreed to dismiss its

appeal from the decision in Case No. 2018 CI 0027, acknowledged Troon’s deed was

valid and enforceable, and affirmed that it had “no legal interest” in the Route 56 Farm.

Section 9 of the agreement states that “Troon assumes all legal risk of * * * [the two

mortgages on the property] and any enforcement action by such lienholder shall not affect

the validity of this agreement; provided, however, that Troon is not assuming AFT’s

obligations on the underlying notes secured by the mortgages referenced in this section,

and is under no obligation to make payments towards the same.”

{¶5} On October 11, 2019, Gerig and AFT entered into an agreement which we

will refer to as the “Gerig-AFT Agreement.” The agreement was signed by Gerig

individually and as agent of Edgart, Ltd., Christian S. Gerig individually, Mrs. Adams

individually and as trustee of AFT, and Mr. Adams individually and as agent of FM2, LLC

and CAM Development Company, Ltd. The agreement provides that Gerig “hereby sells,

assigns, transfers and conveys” to AFT all of her “right, title and interest” in specified

documents, including the Gerig Note and Gerig Mortgage, and “all rights, claims and

interests or the right to payment” she has “arising out of or related to” those documents,

subject to the terms of the Gerig-AFT Agreement. Section 9 of the agreement states that

with certain exceptions, Gerig “makes no representation or warranty” with respect to the

documents, “including, without limitation, enforceability, liability, lien perfection or priority,

collectability, the value or condition of any collateral or the absence of any defects.”

Section 9 then states that AFT “acknowledges and agrees that it will look solely to

Borrower for the payment of the Obligations represented by the Loan Documents.” The Pickaway App. No. 22CA19 4

agreement defines “Borrowers” as FM2, LLC, CAM Development Company, Ltd., Mr.

Adams, and Mrs. Adams as trustee of AFT. The parties and signatories to the Gerig-AFT

Agreement agreed there was “a total of $418,943.31 owed on the” Gerig Note. Mr. Adams

agreed to assign his 18.75% interest in Grande Vista Village, LLC (“GVV”) to Gerig in

exchange for the assignment of the Gerig Note to AFT and “other consideration” detailed

in the agreement. Mr. Adams and Gerig executed a separate document in which Mr.

Adams assigned his GVV interest to her effective October 11, 2019.

{¶6} On October 17, 2019, Gerig executed an Assignment of Mortgage. The

document states that for valuable consideration, she “does hereby sell, assign, transfer

and set over unto [AFT] all of [her] right, title and interest in and to [the Gerig Mortgage].”

On October 23, 2019, Mr. Adams recorded the Assignment of Mortgage. A week later,

he sent a letter to Vincent Rakestraw, a member of Troon, stating that AFT’s trustee had

authorized him “to make a formal demand for payment regarding the” Gerig Note, the

current amount due was $698,488.27, payment was due within 10 days, and if Mr. Adams

did not hear from him, a foreclosure action would be filed. The letter also stated, “If you

do not have the ability to address this payment the Trust would accept a General Warranty

Deed, free of any encumbrances, in exchange for the debt.”

B. The Complaint

{¶7} In November 2019, Troon filed a two-count complaint against AFT, Mr.

Adams, and Gerig. In Count One, Troon sought a declaratory judgment that the Gerig

Mortgage was void and/or satisfied as against the Route 56 Farm and thereby cancelled

of record. Alternatively, Troon asked the court to quiet title to the farm and determine that

the Gerig Mortgage was void and/or satisfied as against the farm and thereby cancelled Pickaway App. No. 22CA19 5

of record. In Count Two, Troon made a claim for slander of title based on the recording

of the Assignment of Mortgage.

C. Summary Judgment Motions

{¶8} Gerig filed a motion for summary judgment supported by the affidavit of her

husband. The trial court granted the motion and dismissed her as a defendant. In doing

so, the court did not consider the materials Troon submitted in support of its memorandum

contra on the ground that Troon failed to comply with Civ.R. 56. With respect to the

slander of title claim against Gerig, the court found that the Assignment of Mortgage did

“nothing but assign whatever interest Defendant Gerig has in [the Gerig Mortgage] to

[AFT]. There are no warranties or representations concerning the enforceability of the

mortgage. The statement of assignment is true. There is no evidentiary material before

this court to counter that conclusion.” The court also found that the affidavit of Gerig’s

husband stated that the Assignment of Mortgage was true, and there was no evidentiary

material before the court to counter the assertions in his affidavit. Thus, the court found

that there were “no genuine issues of material fact that the statements contained in the

Assignment of Mortgage are true.”

{¶9} Troon moved for summary judgment against Mr. Adams and AFT. Among

other things, Troon argued that the case turned “on two basic applications of the law and

common sense. First: if the maker and the holder of a promissory note are the same

person, there is no legally enforceable debt owed on that promissory note since a party

cannot be indebted to themselves. Second: if there is no underlying debt, there can be

no enforceable mortgage to secure that non-existent debt.” Troon asserted the Gerig

Mortgage was void because the Gerig Note had been satisfied. Troon claimed one Pickaway App. No. 22CA19 6

indication the note was satisfied was that “as held by AFT, it is worthless.” Troon argued:

“AFT claims that it is the holder of the Gerig Note by way of an assignment, but it is

indisputably also one of the makers of the Gerig Note also. * * * AFT’s claim that a party

can be legally indebted to itself is an absurdity, and Plaintiff has been unable to find any

reported case law in which this same situation has existed.” (Emphasis sic.) Troon later

stated: “AFT is, by its demand letter to Troon, claiming that it can be both the holder and

the maker of the Gerig Note. This is illogical. A party simply cannot have an enforceable

payment obligation to itself. A party cannot sue itself in Court to recover for its own non-

payment of a debt owed to itself.” (Emphasis sic.) Troon also asserted that AFT’s claim

that it could pursue Troon for payment was contradicted by its agreement to Section 9 of

the Troon-AFT Settlement Agreement and violated Section 9 of the Gerig-AFT

Agreement. Troon asserted AFT and Mr. Adams were also liable for slander of title. Mr.

Adams and AFT opposed Troon’s motion and filed summary judgment motions.

{¶10} The trial court issued a decision and entry regarding the competing

summary judgment motions of Troon and Mr. Adams. The court granted in part Troon’s

motion for summary judgment on its declaratory judgment claim against Mr. Adams,

finding that he was a necessary party to that claim. The court stated that its decision on

the status of the Gerig Mortgage and Mr. Adams’ interest therein, if any, would be

addressed in a separate decision. The court overruled Troon’s motion for summary

judgment on the slander of title claim against Mr. Adams and overruled Mr. Adams’

summary judgment motion.

{¶11} The trial court also issued a decision and entry regarding the competing

summary judgment motions of Troon and AFT. The court held that: (1) AFT’s interests Pickaway App. No. 22CA19 7

as “maker and holder/payee on the Gerig [N]ote merged upon the execution of the

assignment of” the Gerig Note and Gerig Mortgage to AFT, so the “debt on the note was

extinguished and the mortgage is not enforceable against Plaintiff,” (2) Section 9 of the

Troon-AFT Settlement Agreement barred AFT “from collecting any amount due on the

Gerig [N]ote from Plaintiff or enforcing the mortgage against Plaintiff,” (3) Section 9 of the

Gerig-AFT Agreement barred AFT “from collecting any amount due on the Gerig [N]ote

from Plaintiff or enforcing the mortgage against Plaintiff” “under the doctrine of third party

beneficiary contract,” (4) the debt evidenced in the Gerig Note was “discharged against

Plaintiff” by Gerig and AFT in Section 9 of the Gerig-AFT Agreement pursuant to R.C.

1303.69, and (5) Mr. Adams’ position as maker on the Gerig Note and signor on the Gerig-

AFT Agreement gave him no rights to enforce the Gerig Note and Gerig Mortgage. Thus,

the trial court granted Troon summary judgment on the declaratory judgment/quiet title

claim, declared the Gerig Mortgage void against the Route 56 Farm, and quieted title to

the farm against Mr. Adams and AFT. The trial court overruled Troon’s motion for

summary judgment on the slander of title claim and overruled AFT’s motion for summary

judgment. The matter proceeded to a bench trial on the remaining slander of title claim

against the Appellants.

D. The Verdict

{¶12} Following the trial, the court issued a decision containing its findings of fact

and conclusions of law. Among other things, the court found that Mr. Adams “conveyed

his entire ownership interest in [GVV] (valued between $600,000.00 to $800,000.00)

which owned a lucrative apartment complex in Athens, Ohio, to Kristina, in return for his

own liabilities to Kristina being extinguished.” The court found: “As a result of the Gerig- Pickaway App. No. 22CA19 8

AFT Agreement, all obligations of Bret Adams and AFT to Kristina were extinguished.”

The court also found that “[i]n the Gerig-AFT Agreement, the parties intentionally omitted

any reference to the value of the [GVV] membership interest in order to obscure that a

trade of equally valuable assets had occurred.” Additionally, the court found that Section

9 of the Troon-AFT Settlement Agreement “clearly states that Troon is not assuming

AFT’s obligation to pay on the Gerig Note and has to make no payments on the Note,”

and Section 9 of the Gerig-AFT Agreement included language “which explicitly affirmed

that AFT would have no right to pursue collection of the Gerig Note against any parties

other than the original makers of that note.”

{¶13} In its conclusions of law, the court stated, among other things, that:

- “The debt owed by Bret Adams and AFT on the underlying Gerig Note was extinguished when the [GVV] interest was conveyed, and as a matter of law, the corresponding Gerig Mortgage was extinguished also. ‘A real estate mortgage is security for an obligation, and is incidental to that obligation. If the underlying debt is paid, the mortgage is extinguished. An assignment of a mortgage transfers to the assignee all the rights, powers and equities owned by the mortgagee. An attempted assignment of a mortgage, apart from the [obligation] is deemed a nullity.’ Olympic Title Insurance Company v. Fifth Third Bank, 2002-Ohio-5826, ¶19 (2nd Dist.). Moreover, ‘[a] mortgage is a lien for a debt and something more. It is a transfer of the title as security, to be void on payment.’ Division of Aid for Aged, Department of Public Welfare v. Huff (1960), 110 Ohio App. 483, 486 (7th Dist.).”

- “AFT and Bret Adams knew, or should have known, that the Gerig Mortgage was void and could not be enforced against Troon, by operation of both Section 9 of the Settlement Agreement in the First Case, and §9 of the Gerig-AFT Agreement which explicitly stated that the holder of the Gerig Note could only pursue ‘Borrowers’ for payment.”

- “The recording of the Assignment in the Recorder’s Office for Pickaway County, Ohio constituted publication for purposes of a slander of title claim.”

- “The Assignment constituted a false statement because it represented to the world that a valid, enforceable lien existed against [the Route 56 Farm] (in the form of the Gerig Mortgage) when it did not. ‘As a general rule, courts Pickaway App. No. 22CA19 9

have found that wrongfully recording an unfounded claim to the property of another is actionable as slander of title. This is so provided that the other elements for slander of title, namely malice and special damages, are present.’ Green v. Lemarr (2000[)], 139 Ohio App.3d 414, 432 (2nd Dist.).”

- “AFT and Bret Adams knew that the Assignment of the Gerig Mortgage constituted a false statement when recorded into the chain of title for the Route 56 Farm, or they recklessly disregarded the enforceability of the Assignment. Both Bret Adams and Diane Adams testified that they did not consult any legal counsel before proceeding with the recording of the Assignment, and that they were aware of the provisions of §9 of the Gerig- AFT Agreement which prevented them from attempting to pursue Troon for payment of the Gerig Note.”

- “Bret Adams acted with actual malice in recording the Assignment, as evidenced by his lengthy history of verbal abuse towards Troon and its principals, Troon’s counsel, his retaliatory lawsuits in other courts, and his explicit threat that ‘I will get that deed back one way or another.’ ”

- “By ignoring the plain text of §9 of the Gerig-AFT Agreement and Settlement Agreement, and knowingly recording a document into the chain of title to indicate the continuing enforceability of a void mortgage, both AFT and Bret Adams acted with ‘reckless disregard for the rights of’ Troon.”

(Emphasis and second alteration sic.) The court also concluded that Troon “suffered

actual and special damages,” that AFT and Mr. Adams were jointly and severally liable

for slander of title in the amount of $71,557.98 plus post-trial attorney fees in an amount

to be determined, and that Mr. Adams was individually liable for $2,000 in punitive

damages.

E. Subsequent Proceedings

{¶14} Troon filed an affidavit regarding its post-trial attorney fees. Then, AFT and

Mr. Adams filed a motion asking the court to reconsider (1) the decision granting Troon

summary judgment on the declaratory judgment/quiet title claim and denying AFT

summary judgment on that claim, and (2) the decision containing the findings and fact

and conclusions of law on the slander of title claim. On August 26, 2022, a judgment Pickaway App. No. 22CA19 10

entry was filed in which the court stated that in conformity with its findings of fact and

conclusions of law, Troon was granted judgment against AFT and Mr. Adams, “jointly and

severally” for $74,887.48, and that Troon was granted judgment “against the Defendants”

for $2,000 for punitive damages. A minute later, an entry overruling the motion for

reconsideration was filed. This appeal followed.

II. ASSIGNMENTS OF ERROR

{¶15} Appellants present four assignments of error:

1. The trial court erred by granting plaintiff/appellee Troon Management, Ltd. summary judgment on its claim for declaratory judgment to quiet title (Complaint Count One), and by denying defendant/appellant Adams Family Trust’s motion for summary judgment on this claim and on appellee’s slander of title claim (Complaint Count Two).

2. The trial court erred by impliedly denying defendant[s]/appellants’ July 8, 2022 motion to reconsider by entering final judgment before ruling on it.

3. The trial court erred by denying defendant/appellant Bret Adams’ motion for summary judgment on appellee’s slander of title claim (Complaint Count Two).

4. The trial court erred and abused its discretion by finding in favor of plaintiff/appellee on its claim for slander of title and in entering judgment in favor of plaintiff/appellee and against defendants/appellants.

{¶16} The Appellants did not separately argue some assignments of error. They

divided the argument section of their appellate brief into three subsections. The first

subsection addresses the part of the first assignment of error directed to the declaratory

judgment/quiet title claim, and the second subsection addresses the second assignment

of error. However, the third subsection addresses the remainder of the first assignment

of error, the third assignment of error, and the fourth assignment of error. This subsection

is divided into two sub-subsections. The first one appears to combine arguments for the Pickaway App. No. 22CA19 11

remainder of the first assignment of error and the third assignment of error; the second

one seems to address the fourth assignment of error.

{¶17} App.R. 16(A)(7) states: “The appellant shall include in its brief * * * [a]n

argument containing the contentions of the appellant with respect to each assignment of

error presented for review and the reasons in support of the contentions, with citations to

the authorities, statutes, and parts of the record on which appellant relies.” App.R.

12(A)(2) states: “The court may disregard an assignment of error presented for review if

the party raising it * * * fails to argue the assignment separately in the brief, as required

under App. R. 16(A).” Therefore, we have discretion to disregard assignments of error

which are not separately argued. In re F.T., 4th Dist. Ross No. 22CA17, 2023-Ohio-191,

¶ 34. “We prefer, however, to decide cases on their merits rather than procedural

technicalities.” Id. We therefore will review all the assignments of error.

III. DECLARATORY JUDGMENT/QUIET TITLE CLAIM

{¶18} In the first assignment of error, the Appellants contend in part that the trial

court erred by granting Troon summary judgment on the declaratory judgment/quiet title

claim and denying AFT summary judgment on that claim.

A. Standard of Review

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

novo. Harter v. Chillicothe Long-Term Care, Inc., 4th Dist. Ross No. 11CA3277, 2012-

Ohio-2464, ¶ 12. We afford no deference to the trial court’s decision but rather conduct

an independent review to determine whether summary judgment is appropriate. Id. “A

summary judgment is appropriate only when: (1) there is no genuine issue of material

fact; (2) reasonable minds can come to but one conclusion when viewing the evidence in Pickaway App. No. 22CA19 12

favor of the nonmoving party, and that conclusion is adverse to the nonmoving party; and

(3) the moving party is entitled to judgment as a matter of law.” Hawk v. Menasha

Packaging, 4th Dist. Ross No. 07CA2966, 2008-Ohio-483, ¶ 6.

{¶20} “The party moving for summary judgment bears the initial burden to

demonstrate that no genuine issues of material fact exist and that they are entitled to

judgment in their favor as a matter of law.” DeepRock Disposal Solutions, LLC v. Forté

Prods., LLC, 4th Dist. Washington No. 20CA15, 2021-Ohio-1436, ¶ 68. “To meet its

burden, the moving party must specifically refer to ‘the pleadings, depositions, answers

to interrogatories, written admissions, affidavits, transcripts of evidence, and written

stipulations of fact, if any, timely filed in the action,’ that affirmatively demonstrate that the

nonmoving party has no evidence to support the nonmoving party’s claims.” Id., quoting

Civ.R. 56(C). “Once that burden is met, the nonmoving party then has a reciprocal burden

to set forth specific facts to show that there is a genuine issue for trial.” Id.

B. Merger

{¶21} Initially, the Appellants assert that the trial court erred when it held that the

assignment of the Gerig Note to AFT extinguished the note by merger and that the Gerig

Mortgage became unenforceable as a result. The court made the following findings in

connection with its merger determination:

MERGER

No party has provided case law or statute which even remotely addresses this issue. This court has found no case law on point. This court can look to the doctrine of merger by title when considering this issue by analogy. The doctrine of merger by title rests on the principle that a servitude or lesser estate in real property may not encumber another estate in real property when both estates are owned by the same person. H[ie]ner v. Kelley (1999 4th Dist.) * * *. Estates in real property merge when both estates are owned by the same person. By analogy, when the maker of the Pickaway App. No. 22CA19 13

note also becomes the person to whom the debt is owed these interests are merged and the debt is extinguished.

In the face of the dearth of guidance from precedent and the legislature, this court will resort to common sense and reason. A person cannot owe himself money. A person cannot obtain judgment against himself for the payment of money damages to himself. * * * The defendant has given this court no examples of such a situation. When the obligor also becomes the obligee or the promisor also becomes the promisee, the interests of these parties merge and the debt is extinguished.

A mortgage is security for debt obligation and is incidental to that obligation. Any attempted assignment of a mortgage independent from the obligation is invalid. Olympic Title Insurance Company v. Fifth Third Bank, 2002-Ohio-5826; Division of Aid for Aged, Department of Public Welfare v. Huff (1960) 110 OhioApp. 483 [sic]. Since the debt is extinguished by merger, the mortgage cannot be enforced.

1. Position of the Appellants

{¶22} The Appellants maintain that the assignment of the Gerig Note to AFT did

not extinguish the note by merger because the assignment “did not result in a complete

identity of holders and makers.” (Emphasis sic.) They assert “[t]he trial court based its

merger analysis on the notion that a person cannot owe themselves money” and “used

the analogy of estates in real property merging when owned by the same person.” The

Appellants assert this “principle is true where the interest holders are completely identical,

but not where there are differences.” They claim that a case the trial court relied on,

Hiener v. Kelley, 4th Dist. Washington No. 98CA7, 1999 WL 595363 (July 23, 1999),

“even illustrates this principle.” The Appellants assert that in this case, “the relevant

interests did not vest in the same parties coextensively” because only one of the four

makers of the Gerig Note became a holder of it. They maintain that “a person (or entity)

can owe money to another” and that “[t]here is no legal principle inherent in Ohio’s

Uniform Commercial Code or the common law that would prohibit one of several makers Pickaway App. No. 22CA19 14

of a note from receiving a transfer of the note and enforcing it against the other makers.”

Therefore, they claim that even if the assignment of the Gerig Note “merged AFT’s

interests as maker and holder, it did not merge the interests of Bret Adams, FM2, or Cam

Development, and so it did not extinguish the note.” They assert “[t]he trial court erred in

holding otherwise, and in turn erred in finding the mortgage unenforceable based on the

purported extinguishment of the note by merger.”

2. Analysis

{¶23} “Merger” is defined, inter alia, as “[t]he act or instance of combining or

uniting,” and “[t]he merger of rights and duties in the same person, resulting in the

extinction of obligations; esp., the blending of the rights of a creditor and debtor, resulting

in the extinguishment of the creditor’s right to collect the debt.” Black’s Law Dictionary

(11th Ed.2019). In Hiener, we considered whether an easement was extinguished

through merger of title and explained that “[t]he doctrine of merger rests upon the principle

that a servitude may not be impressed upon an estate of another estate when both estates

are owned by the same person.” Hiener at *10. Therefore “an easement is terminated

when the dominant and servient estates become owned by the same person or persons.”

Id. We explained that “[t]o effectively terminate the easement, the fee title with right of

possession of both tracts must vest in the same party or parties, c[o]extensively, and

equal in validity, quality and all other circumstances of right.” Id.

{¶24} In this case, a joint and several promissory note was assigned to one of its

four makers. The parties have not directed us to any on point Ohio case law regarding

whether merger occurs in these circumstances, and like the trial court, we have found

none. However, we conclude merger occurs because joint and several liability means Pickaway App. No. 22CA19 15

“each liable party is individually responsible for the entire obligation, but a paying party

may have a right of contribution or indemnity from nonpaying parties.” (Emphasis added.)

Black’s Law Dictionary (11th Ed.2019). Therefore, even though there were four makers

on the note, AFT was a debtor as to the entire balance due, and once the Gerig Note was

assigned to AFT, it also became the creditor as to the entire balance due. Thus, all rights

and duties under the note united in the same entity. As a result, the debt was

extinguished, and no action can be maintained on the note. See generally Great W. Bank

v. Kong, 90 Cal.App.4th 28, 32 (2001) (“It has long been established in California that the

assignment of a joint and several debt to one of the co-obligors extinguishes that debt.

The assignment amounts to payment and consequently the evidence of that debt, i.e.,

the note * * *, becomes functus officio (of no further effect). Therefore, no action can be

maintained on the original debt.” (Citations omitted.)). The only action AFT could maintain

against its co-makers is one for contribution for sums actually paid toward the debt. See

R.C. 1303.14(B) (“a party having joint and several liability who pays the instrument is

entitled to receive from any party having the same joint and several liability contribution

in accordance with applicable law”).

{¶25} “A real estate mortgage is security for an obligation, and is incidental to that

obligation.” Olympic Title Ins. Co. v. Fifth Third Bank, 2d Dist. Montgomery Nos. 19324,

19319, 2002-Ohio-5826, ¶ 19. So once the underlying debt was extinguished, the Gerig

Mortgage was also extinguished. Therefore, the trial court correctly found that the Gerig

Mortgage was not enforceable against Troon based on merger, and on that basis, granted

Troon summary judgment and denied AFT summary judgment on the declaratory

judgment/quiet title claim. It is therefore unnecessary for us to consider the arguments Pickaway App. No. 22CA19 16

the Appellants make regarding other grounds for the trial court’s ruling on the declaratory

judgment/quiet title claim. Accordingly, we overrule the first assignment of error to the

extent it asserts the trial court erred by granting Troon summary judgment on the

declaratory judgment/quiet title claim and in denying AFT’s motion for summary judgment

on that claim.

IV. MOTION FOR RECONSIDERATION

{¶26} In the second assignment of error, the Appellants contend that the trial court

erred when it implicitly denied their motion for reconsideration by entering final judgment

before ruling on the motion. They maintain that the court “did not completely consider the

merger issue when it granted Troon summary judgment.” They assert that it is reversible

error for a trial court to award summary judgment on a ground not specified in the

summary judgment motion. They claim the trial court “acknowledged that neither party

fully raised or briefed the issue of merger” when the court stated, “No party has provided

case law or statute which even remotely addresses this issue.” They assert that it was

“legal error” for the trial court to grant summary judgment “based on this unbriefed issue”

and that “[t]he trial court could not grant Troon summary judgment based on an issue for

which it acknowledged Troon did not provide any supporting law.” And the Appellants

claim the trial court “compounded this legal error by denying” their motion for

reconsideration.

{¶27} As the Appellants point out, the entry overruling their motion for

reconsideration was filed after the trial court’s final judgment, i.e., the August 26, 2022

entry granting Troon judgment against AFT and Mr. Adams. At that time, the trial court

lacked jurisdiction to reconsider its own valid final judgment. See Estes v. Estes, Pickaway App. No. 22CA19 17

4th Dist. Meigs No. 10CA1, 2010-Ohio-4037, ¶ 9. However, because the motion for

reconsideration was pending when the trial court issued its final judgment, it is deemed

to have been implicitly overruled at that time. Savage v. Cody-Zeigler, Inc., 4th Dist.

Athens No. 06CA5, 2006-Ohio-2760, ¶ 25 (“Ordinarily, any pending motions the trial court

does not expressly rule on when it renders final judgment are deemed implicitly

overruled”).

{¶28} “Generally, a trial court has plenary power to entertain a motion for

reconsideration prior to entering a final judgment.” Culp v. Olukoga, 2013-Ohio-5211, 3

N.E.3d 724, ¶ 59, citing Vanest v. Pillsbury Co., 124 Ohio App.3d 525, 535, 706 N.E.2d

825 (4th Dist.1997), abrogated on other grounds by State ex rel. O’Malley v. Russo, 156

Ohio St.3d 548, 2019-Ohio-1698, 130 N.E.3d 256. “Thus, absent an abuse of discretion,

a reviewing court will not reverse a trial court’s decision regarding a motion for

reconsideration.” Id. An abuse of discretion is “an unreasonable, arbitrary, or

unconscionable use of discretion, or * * * a view or action that no conscientious judge

could honestly have taken.” State v. Brady, 119 Ohio St.3d 375, 2008-Ohio-4493, 894

N.E.2d 671, ¶ 23.

{¶29} The trial court did not abuse its discretion when it overruled the motion for

reconsideration. The Appellants are correct that “ ‘[i]t is reversible error to award

summary judgment on grounds not specified in the motion for summary judgment.’ ” State

ex rel. Sawicki v. Court of Common Pleas of Lucas Cty., 121 Ohio St.3d 507, 2009-Ohio-

1523, 905 N.E.2d 1192, ¶ 27, quoting Patterson v. Ahmed, 176 Ohio App.3d 596, 2008-

Ohio-362, 893 N.E.2d 198, ¶ 14 (6th Dist.). “A party seeking summary judgment must

specifically delineate the basis upon which summary judgment is sought in order to allow Pickaway App. No. 22CA19 18

the opposing party a meaningful opportunity to respond.” Mitseff v. Wheeler, 38 Ohio

St.3d 112, 526 N.E.2d 798 (1998), syllabus. By relying on an unargued ground as a basis

for awarding summary judgment, a court denies the nonmoving party that opportunity.

See Sawicki at ¶ 27.

{¶30} However, Troon did raise the issue of merger in its summary judgment

motion, though it did not use that term. Troon’s motion asserted that “if the maker and

the holder of a promissory note are the same person, there is no legally enforceable debt

owed on that promissory note since a party cannot be indebted to themselves,” that “[a]

party simply cannot have an enforceable payment obligation to itself,” that “[a] party

cannot sue itself in Court to recover for its own non-payment of a debt owed to itself,” and

that “if there is no underlying debt, there can be no enforceable mortgage to secure that

non-existent debt.” (Emphasis sic.) Because Troon raised the merger issue in its

summary judgment motion, the Appellants had a meaningful opportunity to respond in

their memorandum contras. Troon’s inability to direct the trial court to a specific legal

authority to support its position is understandable given the unusual circumstances of this

case and inability of the trial court and this court to find any on point Ohio case law.

However, the principle that a debtor cannot owe itself money or sue itself “is both a legal

truism and a matter of common sense.” In re Morreale, 61 Bankr.Ct.Dec. 60, 2015 WL

3897796, *13 (Bankr.Colo.2015). And as we explained in the previous section, the trial

court correctly determined that the Gerig Mortgage was not enforceable against Troon

based on merger. For these reasons, we conclude the trial court did not err when it denied

the motion for reconsideration and overrule the second assignment of error. Pickaway App. No. 22CA19 19

V. SLANDER OF TITLE CLAIM

{¶31} “Slander of title is a tort action ‘against one who falsely and maliciously

defames title to property and causes some special pecuniary damages or loss.’ ” Bank

of New York Mellon v. Floyd, 8th Dist. Cuyahoga No. 110248, 2021-Ohio-3736, ¶ 58,

quoting Acme Constr. Co. v. Continental Natl. Indemn. Co., 8th Dist. Cuyahoga No.

81402, 2003-Ohio-434, ¶ 46. To succeed, the claimant must prove that “ ‘(1) there was

a publication of a slanderous statement disparaging claimant’s title; (2) the statement was

false; (3) the statement was made with malice or made with reckless disregard of its

falsity; and (4) the statement caused actual or special damages.’ ” Id., quoting Green v.

Lemarr, 139 Ohio App.3d 414, 430-431, 744 N.E.2d 212 (2d Dist.2000).

{¶32} “Typically, slander of title cases involve[ ] documents such as liens or

mortgages ‘filed against a particular piece of property by parties who claim an interest in

the property.’ ” WWSD, LLC v. Woods, 2022-Ohio-952, 188 N.E.3d 244, ¶ 57 (10th Dist.),

reconsideration granted in part on other grounds, 2023-Ohio-3174, quoting Green at 431.

“Documents filed against real property impact title by placing a cloud on the title.” Id. “

‘As a general rule, courts have found that wrongfully recording an unfounded claim to the

property of another is actionable as slander of title. * * * This is so provided that the other

elements for slander of title, namely malice and special damages, are present.’ ”

(Omission sic.) Green at 433-434, quoting TXO Prod. Corp. v. Alliance Resources Corp.,

187 W.Va. 457, 467, 419 S.E.2d 870 (1992).

A. The Denial of Summary Judgment

{¶33} In the remainder of the first assignment of error, the Appellants contend that

the trial court erred by denying AFT’s motion for summary judgment on the slander of title Pickaway App. No. 22CA19 20

claim, and in the third assignment of error, they contend that the trial court also erred by

denying Mr. Adams’ motion for summary judgment on that claim. The Appellants assert

that as detailed in their arguments challenging the summary judgment decision on the

declaratory judgment/quiet title claim, the Gerig Mortgage is valid and enforceable.

Therefore, the Assignment of Mortgage “and the recording of that assignment could not,

as a matter of law, constitute a false statement.” However, in Section III.B.2 of this

decision, we held that the trial court did not err when it granted Troon summary judgment

on the declaratory judgment/quiet title claim because the court correctly determined that

the Gerig Mortgage was not enforceable based on merger. Therefore, the Appellants’

assertion lacks merit.

{¶34} The Appellants suggest that even if the Gerig Mortgage was not

enforceable, the Assignment of Mortgage still does not contain false statements. They

maintain that the trial court recognized this fact because in granting Gerig summary

judgment, the court found the assignment did “nothing but assign whatever interest

Defendant Gerig has in [the Gerig Mortgage] to [AFT],” the assignment “made no

warranties or representations concerning the enforceability of the mortgage,” and the

“statement of assignment is true.” They assert that a review of the Assignment of

Mortgage confirms these findings. However, in Section III.B.2 of this decision, we

explained that once the Gerig Note was assigned to AFT, the debt was extinguished, and

consequently, the Gerig Mortgage was also extinguished. Because the Assignment of

Mortgage indicated the Gerig Mortgage still existed and encumbered the Route 56 Farm,

it constituted a false statement. Pickaway App. No. 22CA19 21

{¶35} For the foregoing reasons, we conclude the Appellants have not

demonstrated that the trial court erred by denying them summary judgment on the slander

of title claim. Accordingly, we overrule the remainder of the first assignment of error and

the third assignment of error.

B. The Verdict

{¶36} In the fourth assignment of error, the Appellants assert that the trial court

erred and abused its discretion by finding in favor of Troon on its slander of title claim and

entering judgment in favor of Troon and against them. They assert that the court erred in

finding them liable for slander of title based on AFT’s inability to pursue Troon for payment

on the note. They direct our attention to the paragraph in the conclusions of law stating

that they “knew, or should have known, that the Gerig Mortgage was void and could not

be enforced against Troon, by operation of” the Section 9 provisions of the Troon-AFT

Settlement Agreement and Gerig-AFT Agreement. They interpret this paragraph to mean

that “the only ground on which the trial court found the mortgage could [not] be enforced

was” by operation of the Section 9 provisions. They assert those provisions only

precluded AFT from enforcing a payment obligation against Troon, not enforcing the

mortgage, so “the trial court’s basis for finding the assignment false was legal error.” They

also assert that the Assignment of Mortgage is true because it “merely indicated

assignment of whatever interest Gerig had in that mortgage to AFT” and “contained no

representations or warranties about the enforceability of the underlying mortgage.”

{¶37} The Appellants also assert that the trial court made additional findings which

“confuse the separate remedies of enforcement of the note’s payment obligations and Pickaway App. No. 22CA19 22

enforcement of the mortgage.” They maintain that the court held that they knew the

Assignment of Mortgage created a false statement “based solely” on their awareness of

the Section 9 provisions. And they direct our attention to the paragraph in the conclusions

of law in which the court determined that they acted with reckless disregard for Troon’s

rights by ignoring the Section 9 provisions and knowingly recording a document in the

chain of title to indicate the continuing enforceability of a void mortgage. They maintain

that their “knowledge of the contract terms that precluded them from enforcing a payment

obligation against Troon could not have affected the distinct remedy of enforcement of

the mortgage.” Thus, they claim the trial court committed legal errors in holding them

liable for slander of title. They assert that “[b]ecause AFT’s inability to enforce the note

against Troon does not affect AFT’s ability to enforce the mortgage, the mortgage was

not void and the Assignment of Mortgage and its recording could not constitute slander

of title as a matter of law.” (Emphasis sic.)

{¶38} The Appellants misinterpret the trial court’s findings of fact and conclusions

of law. Although the trial court did not repeat the merger finding it made during the

summary judgment proceedings, the trial court’s conclusion that the Assignment of

Mortgage constituted a false statement is not premised solely on the court’s interpretation

of the Section 9 provisions of the Troon-AFT Settlement Agreement and Gerig-AFT

Agreement. Before reaching the falsity conclusion, the trial court found that Mr. Adams

conveyed his interest in GVV to Gerig in return for his liabilities to her being extinguished,

that all obligations of Appellants to Gerig were extinguished as a result of the Gerig-AFT

Agreement, and that in that agreement, “the parties intentionally omitted any reference to Pickaway App. No. 22CA19 23

the value of the [GVV] membership interest in order to obscure that a trade of equally

valuable assets had occurred.” In the first paragraph of its conclusions of law, the court

then stated: “The debt owed by Bret Adams and AFT on the underlying Gerig Note was

extinguished when the [GVV] interest was conveyed, and as a matter of law, the

corresponding Gerig Mortgage was extinguished also.” The court then quoted and

emphasized case law indicating that if the debt underlying a mortgage is paid, the

mortgage is extinguished and void.

{¶39} Appellants ignore this paragraph and skip to the third paragraph of the

conclusions of law, which states, “AFT and Bret Adams knew, or should have known, that

the Gerig Mortgage was void and could not be enforced against Troon, by operation of

both Section 9 of the [Troon-AFT Settlement Agreement], and §9 of the Gerig-AFT

Agreement which explicitly stated that the holder of the Gerig Note could only pursue

‘Borrowers’ for payment.” When the first and third paragraphs of the conclusions of law

are read together, it is evident that the trial court concluded that (1) the Gerig Mortgage

was void due to the satisfaction of the underlying debt, i.e., the Gerig Note, (2) the Gerig

Mortgage also could not be enforced against Troon by operation of the Section 9

provisions, and (3) the Appellants knew or should have known these things. Thus, there

were two grounds for the trial court’s subsequent determination that the Assignment of

Mortgage “constituted a false statement because it represented to the world that a valid,

enforceable lien existed against [the Route 56 Farm] (in the form of the Gerig Mortgage)

when it did not.” First, the mortgage was void due to satisfaction of the underlying debt,

and second, the mortgage could not be enforced against Troon by operation of the

Section 9 provisions. Pickaway App. No. 22CA19 24

{¶40} The Appellants do not challenge the first ground in their appellate brief. So

even if we agreed with their position that the trial court erred in its interpretation of the

Section 9 provisions, the trial court’s determination that the Gerig Mortgage was not a

valid, enforceable lien would still stand. And because the Assignment of Mortgage

indicated that the Gerig Mortgage still existed and encumbered the Route 56 Farm, the

Assignment of Mortgage constituted a false statement.

{¶41} The trial court also did not conclude that the third element of the slander of

title claim, i.e., the statement was made with malice or made with reckless disregard of

its falsity, was satisfied based solely on the court’s interpretation of the Section 9

provisions. As explained above, the trial court found that the Gerig Mortgage was void

because the underlying debt was satisfied and that Appellants knew or should have

known this. The trial court also found: “By ignoring the plain text of §9 of the Gerig-AFT

Agreement and Settlement Agreement, and knowingly recording a document into the

chain of title to indicate the continuing enforceability of a void mortgage, both AFT and

Bret Adams acted with ‘reckless disregard for the rights of’ Troon.” (Emphasis added.)

When read in context with the court’s earlier determinations, we interpret the italicized

language to be another reference to the trial court’s conclusion that the Gerig Mortgage

was void because the underlying debt was satisfied. The court also found that “Bret

Adams acted with actual malice in recording the Assignment, as evidenced by his lengthy

history of verbal abuse towards Troon and its principals, Troon’s counsel, his retaliatory

lawsuits in other courts, and his explicit threat that ‘I will get that deed back one way or

another.’ ” So even if we agreed with the Appellants that the trial court erred in its Pickaway App. No. 22CA19 25

interpretation of the Section 9 provisions, there are still additional, unchallenged reasons

supporting the trial court’s determination that the third element was satisfied.

{¶42} We note that in their reply brief, the Appellants did make some arguments

about whether the Gerig Note had been satisfied, but these arguments do not address

the decision on the slander of title claim. In its appellee’s brief, Troon asserted that the

Gerig Mortgage was void because summary judgment evidence established that the

Gerig Note was paid in full as a result of the Gerig-AFT Agreement, so the trial court’s

decision granting Troon summary judgment on its declaratory judgment/quiet title claim

was correct as a matter of law and should be affirmed. In response, the Appellants

asserted that “Troon identifies no evidence that complete payment of the amount owed

on the note ever occurred” and that its argument was “one of accord and satisfaction, not

payment.” They asserted that Troon had the burden to prove they intended for the Gerig-

AFT Agreement to “completely extinguish the Gerig Note,” that the “relevant documents

establish” that they did not have such an intent, and that “Troon did not meet its burden

of proving the Gerig Note debt was extinguished.” They also asserted that the trial court

“did not address” the accord and satisfaction argument “in its summary judgment

decision” and that we should “reject Troon’s invitation to affirm summary judgment based

on an argument that the trial court not only did not adopt, but never addressed.” Whether

Troon was entitled to summary judgment on the declaratory judgment/quiet title claim

based on satisfaction of the Gerig Note is a separate issue from whether the trial court’s

post-trial determination that the Gerig Note had been satisfied is against the manifest

weight of the evidence presented at the trial on the slander of title claim. The reply brief

addresses the former issue, not the latter one. Pickaway App. No. 22CA19 26

{¶43} The Appellants have not demonstrated that the trial court erred by finding

in favor of Troon on the slander of title claim and entering judgment in favor of Troon and

against them. Accordingly, we overrule the fourth assignment of error.

VI. CONCLUSION

{¶44} Having overruled the assignments of error, we affirm the trial court’s

judgment.

JUDGMENT AFFIRMED. Pickaway App. No. 22CA19 27

JUDGMENT ENTRY

It is ordered that the JUDGMENT IS AFFIRMED and that appellants shall pay the costs.

The Court finds there were reasonable grounds for this appeal.

It is ordered that a special mandate issue out of this Court directing the Pickaway County Common Pleas Court to carry this judgment into execution.

Any stay previously granted by this Court is hereby terminated as of the date of this entry.

A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure.

Abele, J. & Wilkin, J.: Concur in Judgment and Opinion.

For the Court

BY: ________________________ Michael D. Hess, Judge

NOTICE TO COUNSEL

Pursuant to Local Rule No. 14, this document constitutes a final judgment entry and the time period for further appeal commences from the date of filing with the clerk.