University Associates v. Sterling Finance Co.

305 N.E.2d 924, 37 Ohio App. 2d 17, 66 Ohio Op. 2d 32, 1973 Ohio App. LEXIS 797
CourtOhio Court of Appeals
DecidedSeptember 10, 1973
DocketC-73239
StatusPublished
Cited by6 cases

This text of 305 N.E.2d 924 (University Associates v. Sterling Finance Co.) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
University Associates v. Sterling Finance Co., 305 N.E.2d 924, 37 Ohio App. 2d 17, 66 Ohio Op. 2d 32, 1973 Ohio App. LEXIS 797 (Ohio Ct. App. 1973).

Opinion

Palmer, J.

This appeal arises from an action brought by the plaintiff-appellee in the Court of Common Pleas of Hamilton County, Ohio, to quiet title to certain real property located in that county as against an adverse interest asserted by defendant-appellant, Sterling Finance Company, hereafter referred to as Sterling, predicated upon a money judgment secured by Sterling against plaintiff-appellee’s predecessor in title. The trial court, considering the matter on an agreed statement of facts, found in favor of the plaintiff-appellee and entered a decree ordering title and possession of the property quieted as against Sterling, which argues here that such order was contrary to law and to the manifest weight of the evidence.

The facts material to this appeal may be summarized as follows:

1. On January 15, 1971, Sterling obtained a money judgment against John and Inez Burrell, the then owners of the real property in question. Sterling did not attempt to levy execution against this property, nor did it then seek to file a certificate of such judgment with the office of the Clerk of the Court of Common Pleas pursuant to R. C. 2329.02 et seq.

2. On February 4, 1972, John and Inez Burrell conveyed the property in question by deed of that date to Judith A. Lewis, who paid the full purchase price therefor pursuant to mortgage financing. Lewis took immediate possession of the property, but the deed was left with the financial institution for later recording.

3. On February 7, 1972, Sterling filed with the Clerk of Courts, Hamilton County, Ohio, a certificate of judgment setting forth the money judgment secured against the Burrells on January 15, 1971.

4. Thereafter, on February 8, 1972, the deed from the Burrells to Lewis was presented to the auditor of Hamilton County for transfer, which was duly accomplished on *19 February 9, 1972, on which date it was also lodged with and recorded by the recorder of Hamilton County.

5. On October 5, 1973, Lewis conveyed the property in question to plaintiff-appellee, said deed being duly recorded.

Sterling argued in the trial court and urges here that its money judgment against the Burrells, which it caused to be certified: in accordance with R. C. 2329.02 et seq. after the actual delivery of the deed to and the taking of possession by Lewis, but before the recordation thereof, is a valid lien against the real property now owned and possessed by Lewis’ successor. This appeal tests the correctness of that position.

The general rule applicable to the problem has been stated as follows:

“Accordingly, the interest of a person to whom a judgment debtor has conveyed real estate before the attachment of the judgment or execution lien is preferred to the interest of the judgment creditor, unless such priority is affected by the provisions of recording statutes, or statutes relating to fraudulent conveyances, or the conveyance is void for other reasons, or the grantee is estopped from asserting Ms claim as against the judgment creditors.” (Emphasis added.) 32 Ohio Jurisprudence 2d 178, Judgments, Section 458.

This statement of the rule appears entirely consistent with the decisions by the Supreme Court in Dow v. Union National Bank, 87 Ohio St. 173; Miller v. Albright, 60 Ohio St. 48, and Roads v. Symmes, 1 Ohio 281. See also State Fidelity Federal S & L Assoc. v. Wehrly, 54 Ohio Op. 2d 314, 263 N. E. 2d 801. We take it, therefore, that the fact that Sterling occupied the status of a judgment creditor of the Burrells prior to the execution and delivery of the deed to Lewis does not itself suffice to charge the property in the hands of Lewis with Sterling’s claim, unless one or more of the above enumerated factors varying the general rule may be found to be here present. However, an examination of the record before this court reveals nothing from which to conclude the existence of any element of fraudulent *20 conveyance from the Burrells to Lewis, nor to justify an estoppel of Lewis or her successor to deny Sterling’s claim, nor to conclude that the conveyance is, for any reason, void.

Sterling, indeed, does not assert any of the foregoing factors which might be held to qualify or condition the general rule preferring the interest of the vendee over the judgment creditor, but argues the controlling effect of the “recording statutes,” urging that its priority is favorably affected by virtue of its compliance with the certification procedure of R. C. 2329.02 et seq. before the deed to Lewis was recorded, and that by bringing itself within this procedure, it became a “subsequent bona fida purchaser for value” within the meaning of R. C. 5301.25(A), which provides that:

“All deeds * * * shall be recorded in the office of the county recorder of the county in which the premises are situated, and until so recorded or filed for record, they are fraudulent, so far as relates to a subsequent bona fide purchaser having, at the time of purchase, no knowledge of the existence of such former deed * * "While this position appears at first blush to receive some support in cases cited by Sterling, an analysis of those cases demonstrates that they will not bear the burden sought to be placed upon them by appellant, and are readily distinguishable from the instant cause.

Thus, in Sternberger and Williard v. Ragland, 57 Ohio St. 148, the judgment creditor was the purchaser at a judicial sale of the property in question, and was held by virtue thereof to be a bona fide purchaser without notice of an unrecorded deed made by the judgment debtor, and entitled to the protection of the statute. MicMethwait v. Fulton, 129 Ohio St. 488, involved the claim of a judgment creditor not against the grantor but against the grantee and her husband, of a deed which the grantee’s husband had recorded in apparent violation of an escrow agreement to hold the deed until the grantor’s death. Under these circumstances, the court held that when the grantor executes a deed absolute in form and delivers it to an escrow of her own choosing, such deposit is at the grantor’s own *21 risk, and the grantor will be estopped to deny the validity of the deed as to subsequent judgment creditors of the grantee who extend credit in reliance upon the latter’s record title to the property. The case has nothing to do with R. C. 5301.25(A), and is inapposite to the issues here presented. In Boerner v. Hullinger, 94 Ohio App. 51, the judgment creditor was held to have no lien on property where the judgment debtor conveyed the property by deed which was recorded after the judgment was secured but before any levy of execution and is, therefore, authority for the general proposition stated at the outset of this decision. Indeed, the court stated (p. 62):

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Bluebook (online)
305 N.E.2d 924, 37 Ohio App. 2d 17, 66 Ohio Op. 2d 32, 1973 Ohio App. LEXIS 797, Counsel Stack Legal Research, https://law.counselstack.com/opinion/university-associates-v-sterling-finance-co-ohioctapp-1973.