[Cite as US Bank Natl. Assn. v. Avery, 2015-Ohio-3908.]
COURT OF APPEALS RICHLAND COUNTY, OHIO FIFTH APPELLATE DISTRICT
US BANK NATIONAL ASSOCIATION : JUDGES: : Hon. W. Scott Gwin, P.J. Plaintiff-Appellee : Hon. Sheila G. Farmer, J. : Hon. Patricia A. Delaney, J. -vs- : : JOHN E. AVERY, ET AL. : Case No. 14CA89 : Defendants-Appellants : OPINION
CHARACTER OF PROCEEDING: Appeal from the Court of Common Pleas, Case No. 12CV0533
JUDGMENT: Affirmed
DATE OF JUDGMENT: September 23, 2015
APPEARANCES:
For Plaintiff-Appellee For Defendants-Appellants
SCOTT A. KING DANIEL L. MCGOOKEY TERRY W. POSEY, JR. KATHRYN M. EYSTER 10050 Innovation Drive 225 Meigs Street Suite 400 Sandusky, OH 44870 Miamisburg, OH 45342 Richland County, Case No. 14CA89 2
Farmer, J.
{¶1} On May 8, 2012, appellee, U.S. Bank National Association, as Trustee for
Credit Suisse First Boston Mortgage Securities Corp., Home Equity Asset Trust 2006-2,
Home Equity Pass-Through Certificates, Series 2006-2, filed a foreclosure complaint
against appellants, John and Florine Avery, and others, for money due and owing on a
mortgage secured by a note. Appellant John Avery had received a Chapter 7 discharge
in bankruptcy; therefore, his personal liability on the note had been extinguished.
{¶2} On March 19, 2013, appellee filed a motion for summary judgment,
claiming genuine issues of material fact did not exist. By in rem judgment entry filed
May 6, 2013, the trial court granted the motion and ordered foreclosure.
{¶3} On August 21, 2014, appellants filed a Civ.R. 60(B) motion for relief from
judgment, claiming appellee did not establish that it was entitled to enforce the
mortgage and note and met the conditions precedent prior to filing the foreclosure
complaint, and did not act equitably in the case. By order filed October 16, 2014, the
trial court denied the motion, finding appellants did not raise any meritorious claims
and/or defenses and the motion was not made within a reasonable time.
{¶4} Appellants filed an appeal and this matter is now before this court for
consideration. Assignment of error is as follows:
I
{¶5} "THE TRIAL COURT ERRED IN GRANTING JUDGMENT TO
PLAINTIFF." Richland County, Case No. 14CA89 3
{¶6} Appellants claim the trial court erred in denying their Civ.R. 60(B) motion
for relief from judgment. We disagree.
{¶7} A motion for relief from judgment under Civ.R. 60(B) lies in the trial court's
sound discretion. Griffey v. Rajan, 33 Ohio St.3d 75 (1987). In order to find an abuse
of that discretion, we must determine the trial court's decision was unreasonable,
arbitrary or unconscionable and not merely an error of law or judgment. Blakemore v.
Blakemore, 5 Ohio St.3d 217 (1983). Appellants based their Civ.R. 60(B) motion on
"any other reason justifying relief from the judgment." Civ.R. 60(B)(5). In GTE
Automatic Electric Inc. v. ARC Industries, Inc., 47 Ohio St.2d 146 (1976), paragraph two
of the syllabus, the Supreme Court of Ohio held the following:
To prevail on a motion brought under Civ.R. 60(B), the movant
must demonstrate that: (1) the party has a meritorious defense or claim to
present if relief is granted; (2) the party is entitled to relief under one of the
grounds stated in Civ.R. 60(B)(1) through (5); and (3) the motion is made
within a reasonable time, and, where the grounds of relief are Civ.R.
60(B)(1), (2) or (3), not more than one year after the judgment, order or
proceeding was entered or taken.
{¶8} Appellants argue they have meritorious claims to present: 1) appellee
failed to establish it was the holder of the mortgage and note, 2) appellee did not
establish it met the conditions precedent to filing the foreclosure complaint, 3) appellee Richland County, Case No. 14CA89 4
did not act in accordance with a consent judgment executed on April 4, 2012 in United
States v. Bank of America Corporation, Case No. 12CV0361, United States District
Court for the District of Columbia, and 4) justice and equity require relief from judgment
because of appellee's actions pre-suit and post-judgment.
{¶9} On March 19, 2013, appellee filed a motion for summary judgment with
attached affidavits and assignments of mortgage and note. In their response filed April
26, 2013, appellants alleged the amounts due were incorrect and included an affidavit of
appellant John Avery. On May 6, 2013, the trial court granted the summary judgment
motion and filed an in rem judgment entry and decree of foreclosure.
{¶10} Appellants did not file an appeal of the trial court's May 6, 2013 judgment
entry. Also, appellants' response to the summary judgment motion did not raise any of
the issues argued in their Civ.R. 60(B) motion.
{¶11} In Bank of America, N.A. v. Kuchta, 141 Ohio St.3d 75, 2014-Ohio-4275,
the Supreme Court of Ohio reviewed the issue of whether a party could collaterally
attack a foreclosure order by attacking the issue of standing via a Civ.R. 60(B) motion.
In finding a Civ.R. 60(B) motion cannot be used as a substitute for a timely appeal, the
court found the Kuchtas did not allege intrinsic fraud, and stated the following at ¶ 15-
16:
Further, because the issue of standing could have been and in fact
was raised during the foreclosure proceedings, res judicata prevents the
Kuchtas from using the issue to establish entitlement to relief. Ohio's
Civ.R. 60(B) is substantially equivalent to Fed.R.Civ.P. 60(b), which Richland County, Case No. 14CA89 5
codified the centuries-old "rule of equity to the effect that under certain
circumstances, one of which is after-discovered fraud, relief will be
granted against judgments" regardless of their finality. Hazel-Atlas Glass
Co. v. Hartford-Empire Co., 322 U.S. 238, 244, 64 S.Ct. 997, 88 L.Ed.
1250 (1944). Civ.R. 60(B) exists to resolve injustices that are so great
that they demand a departure from the strict constraints of res judicata.
Id. However, the rule does not exist to allow a party to obtain relief from
his or her own choice to forgo an appeal from an adverse decision.
Ackerman v. United States, 340 U.S. 193, 198, 71 S.Ct. 209, 95 L.Ed. 207
(1950).
It is well established that a Civ.R. 60(B) motion cannot be used as a
substitute for an appeal and that the doctrine of res judicata applies to
such a motion. Harris v. Anderson, 109 Ohio St.3d 101, 2006-Ohio-1934,
846 N.E.2d 43, ¶ 8-9. In this case, the Kuchtas filed a Civ.R. 60(B) motion
in order to relitigate an issue that they had raised at the start of litigation
and which they failed to appeal. Thus, the doctrine of res judicata bars
their attempted collateral attack against the judgment in foreclosure.
{¶12} In its October 16, 2014 order denying the Civ.R. 60(B) motion, the trial
court correctly concluded that the time to challenge appellee's standing or status as the
holder of the mortgage and note and conditions precedent was at the motion for
summary judgment. Appellants did not do so; therefore, Civ.R. 60(B) relief is not
appropriate or warranted. Richland County, Case No. 14CA89 6
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[Cite as US Bank Natl. Assn. v. Avery, 2015-Ohio-3908.]
COURT OF APPEALS RICHLAND COUNTY, OHIO FIFTH APPELLATE DISTRICT
US BANK NATIONAL ASSOCIATION : JUDGES: : Hon. W. Scott Gwin, P.J. Plaintiff-Appellee : Hon. Sheila G. Farmer, J. : Hon. Patricia A. Delaney, J. -vs- : : JOHN E. AVERY, ET AL. : Case No. 14CA89 : Defendants-Appellants : OPINION
CHARACTER OF PROCEEDING: Appeal from the Court of Common Pleas, Case No. 12CV0533
JUDGMENT: Affirmed
DATE OF JUDGMENT: September 23, 2015
APPEARANCES:
For Plaintiff-Appellee For Defendants-Appellants
SCOTT A. KING DANIEL L. MCGOOKEY TERRY W. POSEY, JR. KATHRYN M. EYSTER 10050 Innovation Drive 225 Meigs Street Suite 400 Sandusky, OH 44870 Miamisburg, OH 45342 Richland County, Case No. 14CA89 2
Farmer, J.
{¶1} On May 8, 2012, appellee, U.S. Bank National Association, as Trustee for
Credit Suisse First Boston Mortgage Securities Corp., Home Equity Asset Trust 2006-2,
Home Equity Pass-Through Certificates, Series 2006-2, filed a foreclosure complaint
against appellants, John and Florine Avery, and others, for money due and owing on a
mortgage secured by a note. Appellant John Avery had received a Chapter 7 discharge
in bankruptcy; therefore, his personal liability on the note had been extinguished.
{¶2} On March 19, 2013, appellee filed a motion for summary judgment,
claiming genuine issues of material fact did not exist. By in rem judgment entry filed
May 6, 2013, the trial court granted the motion and ordered foreclosure.
{¶3} On August 21, 2014, appellants filed a Civ.R. 60(B) motion for relief from
judgment, claiming appellee did not establish that it was entitled to enforce the
mortgage and note and met the conditions precedent prior to filing the foreclosure
complaint, and did not act equitably in the case. By order filed October 16, 2014, the
trial court denied the motion, finding appellants did not raise any meritorious claims
and/or defenses and the motion was not made within a reasonable time.
{¶4} Appellants filed an appeal and this matter is now before this court for
consideration. Assignment of error is as follows:
I
{¶5} "THE TRIAL COURT ERRED IN GRANTING JUDGMENT TO
PLAINTIFF." Richland County, Case No. 14CA89 3
{¶6} Appellants claim the trial court erred in denying their Civ.R. 60(B) motion
for relief from judgment. We disagree.
{¶7} A motion for relief from judgment under Civ.R. 60(B) lies in the trial court's
sound discretion. Griffey v. Rajan, 33 Ohio St.3d 75 (1987). In order to find an abuse
of that discretion, we must determine the trial court's decision was unreasonable,
arbitrary or unconscionable and not merely an error of law or judgment. Blakemore v.
Blakemore, 5 Ohio St.3d 217 (1983). Appellants based their Civ.R. 60(B) motion on
"any other reason justifying relief from the judgment." Civ.R. 60(B)(5). In GTE
Automatic Electric Inc. v. ARC Industries, Inc., 47 Ohio St.2d 146 (1976), paragraph two
of the syllabus, the Supreme Court of Ohio held the following:
To prevail on a motion brought under Civ.R. 60(B), the movant
must demonstrate that: (1) the party has a meritorious defense or claim to
present if relief is granted; (2) the party is entitled to relief under one of the
grounds stated in Civ.R. 60(B)(1) through (5); and (3) the motion is made
within a reasonable time, and, where the grounds of relief are Civ.R.
60(B)(1), (2) or (3), not more than one year after the judgment, order or
proceeding was entered or taken.
{¶8} Appellants argue they have meritorious claims to present: 1) appellee
failed to establish it was the holder of the mortgage and note, 2) appellee did not
establish it met the conditions precedent to filing the foreclosure complaint, 3) appellee Richland County, Case No. 14CA89 4
did not act in accordance with a consent judgment executed on April 4, 2012 in United
States v. Bank of America Corporation, Case No. 12CV0361, United States District
Court for the District of Columbia, and 4) justice and equity require relief from judgment
because of appellee's actions pre-suit and post-judgment.
{¶9} On March 19, 2013, appellee filed a motion for summary judgment with
attached affidavits and assignments of mortgage and note. In their response filed April
26, 2013, appellants alleged the amounts due were incorrect and included an affidavit of
appellant John Avery. On May 6, 2013, the trial court granted the summary judgment
motion and filed an in rem judgment entry and decree of foreclosure.
{¶10} Appellants did not file an appeal of the trial court's May 6, 2013 judgment
entry. Also, appellants' response to the summary judgment motion did not raise any of
the issues argued in their Civ.R. 60(B) motion.
{¶11} In Bank of America, N.A. v. Kuchta, 141 Ohio St.3d 75, 2014-Ohio-4275,
the Supreme Court of Ohio reviewed the issue of whether a party could collaterally
attack a foreclosure order by attacking the issue of standing via a Civ.R. 60(B) motion.
In finding a Civ.R. 60(B) motion cannot be used as a substitute for a timely appeal, the
court found the Kuchtas did not allege intrinsic fraud, and stated the following at ¶ 15-
16:
Further, because the issue of standing could have been and in fact
was raised during the foreclosure proceedings, res judicata prevents the
Kuchtas from using the issue to establish entitlement to relief. Ohio's
Civ.R. 60(B) is substantially equivalent to Fed.R.Civ.P. 60(b), which Richland County, Case No. 14CA89 5
codified the centuries-old "rule of equity to the effect that under certain
circumstances, one of which is after-discovered fraud, relief will be
granted against judgments" regardless of their finality. Hazel-Atlas Glass
Co. v. Hartford-Empire Co., 322 U.S. 238, 244, 64 S.Ct. 997, 88 L.Ed.
1250 (1944). Civ.R. 60(B) exists to resolve injustices that are so great
that they demand a departure from the strict constraints of res judicata.
Id. However, the rule does not exist to allow a party to obtain relief from
his or her own choice to forgo an appeal from an adverse decision.
Ackerman v. United States, 340 U.S. 193, 198, 71 S.Ct. 209, 95 L.Ed. 207
(1950).
It is well established that a Civ.R. 60(B) motion cannot be used as a
substitute for an appeal and that the doctrine of res judicata applies to
such a motion. Harris v. Anderson, 109 Ohio St.3d 101, 2006-Ohio-1934,
846 N.E.2d 43, ¶ 8-9. In this case, the Kuchtas filed a Civ.R. 60(B) motion
in order to relitigate an issue that they had raised at the start of litigation
and which they failed to appeal. Thus, the doctrine of res judicata bars
their attempted collateral attack against the judgment in foreclosure.
{¶12} In its October 16, 2014 order denying the Civ.R. 60(B) motion, the trial
court correctly concluded that the time to challenge appellee's standing or status as the
holder of the mortgage and note and conditions precedent was at the motion for
summary judgment. Appellants did not do so; therefore, Civ.R. 60(B) relief is not
appropriate or warranted. Richland County, Case No. 14CA89 6
{¶13} As for the consent judgment claim, we concur with the trial court's analysis
that the consent judgment in not enforceable by third-parties and appellants were not
parties to the consent judgment, and it was without jurisdiction to enforce the consent
agreement.
{¶14} Appellants also argue the facts sub judice cry for equitable relief.
Specifically, in their August 21, 2014 Civ.R. 60(B) motion, appellants argued appellee's
pre-suit and post-judgment actions require relief:
In February 2011, the Averys were advised by the lender's
representatives to quit paying so they could apply for loan modification
after being 3 months behind. As a result of this representation, they quit
paying on the loan. The Averys were further informed they would qualify
for a loan modification. Shortly thereafter, the Averys were informed the
investor would not allow a second loan modification (their loan had a
previous loan modification). The lender continued to accept financials,
informing the Averys that there were certain facts and circumstances that
would allow an exception to the investor's guideline.
***
In November 2013, the Averys were approved for $25,000
reinstatement money as long as the Averys contributed an additional
$47,200. The Averys pulled from retirement and sent to the HUD agency
the amount of $47,200. This money was sent in a timely manner. The
HUD agency attempted to send the reinstatement money to the lender Richland County, Case No. 14CA89 7
prior to the expiration of the reinstatement quote but the lender increased
the reinstatement amount by another $9,000, unexpectedly and without
explanation. The Averys did not have another $9,000. As a result, Ohio's
Save the Dream program sent $47,200 back to the Averys and closed the
file.
The lender has continued to ask for financials and then deny based
upon the investor guideline. It was apparent after the last submission and
denial that the lender has no intent to help borrowers. As a result, the
Averys immediately sought counsel.
{¶15} We find any pre-suit claims appellants had against appellee were
extinguished by the failure to raise those defenses in their answer or at the motion for
summary judgment. Although appellants' May 18, 2012 answer claimed appellee was
barred from bringing suit because appellants were pursuing a workout agreement, this
claim or any facts to substantiate it were not presented in the defense for summary
judgment. Therefore, we conclude any pre-suit action is barred under the doctrine of
res judicata and failure to appeal the May 6, 2013 judgment entry.
{¶16} As for appellants' post-judgment claims, post-judgment attempts to settle
may very well mitigate on the issue of timeliness of a Civ.R. 60 motion, but do not attack
the legality or sufficiency of the judgment. The delay caused by the attempts to resolve
this "in rem only" action afforded appellants additional opportunities to keep their
property. These delays do not demonstrate that appellants' were prejudiced. Richland County, Case No. 14CA89 8
{¶17} Upon review, we find the trial court did not err nor abuse its discretion in
denying appellants' Civ.R. 60(B) motion for relief from judgment.
{¶18} The sole assignment of error is denied.
{¶19} The judgment of the Court of Common Pleas of Richland County, Ohio is
hereby affirmed.
By Farmer, J.
Gwin, P.J. and
Delaney, J. concur.
SGF/sg 831