[Cite as Deutsche Bank Natl. Trust Co. v. Dowd, 2015-Ohio-3799.]




                            IN THE COURT OF APPEALS OF OHIO
                                SIXTH APPELLATE DISTRICT
                                       ERIE COUNTY


Deutsche Bank National Trust Company,                     Court of Appeals No. E-13-043
as Trustee for the Harbor View Mortgage
Trust 2006-9 Trust Fund                                   Trial Court No. 2010CV0814

        Appellee

v.

Vickie L. Dowd, et al.                                    DECISION AND JUDGMENT

        Appellants                                        Decided: September 18, 2015

                                                *****

        Jason A. Whitacre and Laura C. Infante, for appellee.

        Craig T. Conley, for appellants.

                                                *****

        JENSEN, J.

                                            I. Introduction

        {¶ 1} This is an appeal from a judgment in foreclosure of the Erie County Court of

Common Pleas, granting summary judgment in favor of appellee, Deutsche Bank

National Trust Company, as trustee for the Harbor View Mortgage Trust 2006-9 Trust

Fund (hereinafter, the “appellee”). For the reasons set forth below, we affirm.
                    II. Statement of Facts and Procedural History

       {¶ 2} On August 3, 2006, appellants, Vickie L. Dowd and Thomas F. Dowd,

purchased a home located at 2137 Cedar Point Road, Sandusky in Erie County, Ohio. To

finance the purchase, appellant Vickie L. Dowd borrowed $540,000 from Paragon Home

Lending, LLC and agreed to repay the loan in a promissory note. The repayment

obligations were secured by a mortgage, executed by both appellants and recorded on

August 28, 2006.

       {¶ 3} In late 2009, according to the complaint, appellants defaulted on the

payment obligations set forth in the note and mortgage. On October 6, 2010, appellee

filed suit against appellants. In the complaint, appellee asserted that appellants were in

default, that appellee “has” accelerated the amount due, that all conditions precedent had

been satisfied, and that it was entitled to foreclose the mortgage. Appellee claimed that it

was owed $580,045.35, plus interest, from November 1, 2009, and continuing.

       {¶ 4} Appellee attached three exhibits to the complaint. Exhibit A is the

promissory note between Vickie Dowd and Paragon Home Lending. Exhibit B is the

mortgage between appellants and MERS, as nominee for Paragon. Exhibit C is a

mortgage assignment from MERS to appellee, dated March 15, 2010. The mortgage

assignment was recorded on March 19, 2010. An amended promissory note, indorsed in

blank, was filed with the court on January 11, 2012.




2.
        {¶ 5} On December 2, 2010, appellants filed an answer. Appellants admitted that

they were parties to the agreements but denied for lack of knowledge, or because they

were not true, the remaining allegations. Appellants raised a number of affirmative

defenses.

        {¶ 6} On April 30, 2013, appellee moved for summary judgment, arguing that it

was entitled to enforce the note and mortgage, as a matter of law.1

        {¶ 7} On May 3, 2013, appellants filed “Defendants’ Memorandum Contra and

Defendants’ Motion for Summary Judgment.” They argued that appellee failed to meet

the conditions precedent prior to filing suit. Appellants also challenged appellee’s

standing to sue, arguing that there was a gap in the “chain of title” of the mortgage and

note.

        {¶ 8} On July 10, 2013, the trial court granted appellee’s motion and denied

appellants’ motion. The court ordered appellants’ rights in the premises foreclosed and

ordered the property sold.

        {¶ 9} Appellants appealed the judgment on August 7, 2013, and the order of sale

was withdrawn, pending this appeal. Appellants claim two assignments of error.

                          III. Appellants’ Assignments of Error

               1. The Trial Court below erred in granting summary judgment to

        Plaintiff/Appellee.

1
  Appellee filed a previous motion for summary judgment against appellants which the
trial court initially granted, by order dated September 10, 2012. The trial court then
vacated its order on October 3, 2012. Neither the motion nor orders are at issue herein.




3.
              2. The Trial Court below erred in denying summary judgment to

       Defendants/Appellants.

                                  IV. Law and Analysis

       {¶ 10} We review summary judgment rulings de novo, applying the same standard

as the trial court. Lorain Natl. Bank v. Saratoga Apts., 61 Ohio App.3d 127, 129, 572

N.E.2d 198 (9th Dist.1989); Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671

N.E.2d 241 (1996). Under Civ.R. 56(C), summary judgment is appropriate where:

(1) no genuine issue as to any material fact exists; (2) the moving party is entitled to

judgment as a matter of law; and (3) reasonable minds can come to but one conclusion,

and viewing the evidence most strongly in favor of the nonmoving party, that conclusion

is adverse to the nonmoving party. Harless v. Willis Day Warehousing Co., 54 Ohio

St.2d 64, 66, 375 N.E.2d 46 (1978). The party moving for summary judgment bears the

initial burden of identifying the portions of the record which demonstrate the absence of a

genuine issue of fact on a material element of the non-moving party’s claim. Dresher v.

Burt, 75 Ohio St.3d 280, 662 N.E.2d 264 (1996). The burden then shifts to the non-

moving party to submit or point to some evidentiary material showing that there is a

genuine issue for trial. Henkle v. Henkle, 75 Ohio App.3d 732, 735, 600 N.E.2d 791

(12th Dist.1991).

       {¶ 11} To properly support a motion for summary judgment in a foreclosure

action, a plaintiff must present evidentiary-quality materials showing: (1) the movant is

the holder of the note and mortgage, or is a party entitled to enforce the instrument; (2) if




4.
the movant is not the original mortgagee, the chain of assignments and transfers; (3) the

mortgager is in default; (4) all conditions precedent have been met; and (5) the amount of

principal and interest due. U.S. Bank, N.A. v. Coffey, 6th Dist. Erie No. E-11-026, 2012-

Ohio-721, ¶ 26.

       {¶ 12} In this case, appellants raise two arguments in support of the appeal. First,

they challenge the fourth element of appellee’s prima facie case, that it failed to meet the

conditions precedent prior to filing suit. Appellants argue that appellee was required to

give notice of its intent to accelerate payment of the loan and that appellee failed to

satisfy that condition.

       {¶ 13} The note and mortgage in this case require that, in the event of default, the

lender/mortgagee provide notice to the borrower/mortgagor that it intends to accelerate

repayment of the loan. The notice must specify, in part, that the lender may pursue its

right to foreclose in a judicial proceeding.

       {¶ 14} In paragraph 3 of the complaint, appellee alleged as follows:

       {¶ 15} [Appellee] says that the conditions in said mortgage have been

broken by reason of default in payment, that the same has become absolute, that

the conditions precedent have been satisfied, that [appellee] is entitled to

foreclosure of said mortgage; that the [appellants] named in the Complaint, have

or claim to have an interest in the premises described in EXHIBIT B.

       {¶ 16} In their answer, appellants responded, “[appellants] admit they have

an interest in the subject premises, but deny, either because of lack of knowledge




5.
or because they are not true, the remaining allegations contained in paragraph 3 of

[appellee’s] Complaint.”

       {¶ 17} “Where prior notice of default and/or acceleration is required by a

provision in a note or mortgage instrument, the provision of notice is a condition

precedent subject to Civ.R. 9(C).” First Fin. Bank v. Doellman, 9th Dist. Butler No.

CA2006-02-029, 2007-Ohio-222, ¶ 20.

       {¶ 18} Civ.R. 9(C) provides, “In pleading the performance or occurrence of

conditions precedent, it is sufficient to aver generally that all conditions precedent have

been performed or have occurred. A denial of performance or occurrence shall be made

specifically and with particularity.”

       {¶ 19} Thus, while a general averment that all conditions precedent have been

performed is sufficient, a party denying as much is held to a higher standard.

              In contrast to the liberal pleading standard for a party alleging the

       satisfaction of conditions precedent, a party denying performance or

       occurrence of a condition precedent must do so specifically and with

       particularity. Civ.R. 9(C). A general denial of performance of conditions

       precedent is not sufficient to place performance of a condition precedent in

       issue. * * * The effect of the failure to deny conditions precedent in the

       manner provided by Civ.R. 9(C) is that they are deemed admitted. Coffey,

       6th Dist. Erie No. E-11-026, 2012-Ohio-721, at ¶ 3, quoting Lewis v.




6.
       Wal-Mart, Inc., 10th Dist. Franklin No. 93AP-121, 1993 WL 310411, *3

       (Aug. 12, 1993).

       {¶ 20} In a similar case before this court, the defendant-homeowner generally

denied in her answer the bank’s claim that it had satisfied the conditions precedent.

Because the homeowner “failed to deny the [bank’s] performance with specificity or

particularity, the satisfaction of the conditions precedent is deemed admitted, and no

genuine issue of material fact exists on this subject.” Bank of Am., N.A. v. Duran, 6th

Dist. Lucas No. L-14-1031, 2015-Ohio-630, ¶ 49.

       {¶ 21} We reach the same result. That is, appellants’ failure to dispute specifically

and with particularity appellee’s claim that it satisfied the conditions precedent operates

as an admission on that subject by appellant.

       {¶ 22} Further, Vickie Dowd’s subsequent claim, by way of affidavit filed in

support of summary judgment, that she had “neither recollection or record of having

received the notice [of acceleration]” does not, as a matter of law, create an issue of fact

on that issue. By operation of Civ.R. 9(C), the affirmative defense must be raised in the

answer or it is deemed admitted. Bank of Am., N.A. v. Staples, 7th Dist. Mahoning No.

14MA109, 2015-Ohio-2094, ¶ 46.

       {¶ 23} Appellants also challenge the first element of appellee’s prima facie case,

that appellee did not demonstrate that it had standing “to bring and/or maintain this

action.” Appellants claim that “there is an unexplained ‘gap’ in the ‘chain of title’ vis-à-

vis assignment of the subject Note and/or Mortgage.” Specifically, they claim that




7.
appellee did not provide evidence of an assignment from appellee to Bank of America,

N.A. The record indicates that, at one point during the trial phase of this case, Bank of

America, N.A. was substituted as the proper plaintiff.

       {¶ 24} Standing to sue in the foreclosure arena must be determined at the

commencement of the suit. Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio

St.3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, ¶ 28. Thus, if a party seeking to foreclose

fails to establish “an interest in the note or mortgage at the time it filed suit, it [has] no

standing to invoke the jurisdiction of the common pleas court.” (Emphasis added.) Bank

of New York Mellon v. Matthews, 6th Dist. Fulton No. F-12-008, 2013-Ohio-1707, ¶ 11,

quoting Schwartzwald at ¶ 28.

       {¶ 25} “Ohio’s version of the Uniform Commercial Code (“U.C.C.”) governs who

may enforce negotiable instruments, including promissory notes secured by mortgages on

real estate.” Wright-Patt Credit Union, Inc. v. Byington, 6th Dist. Erie No. E-12-002,

2013-Ohio-3963, ¶ 11. See also R.C. 1301.01 et seq.2 A “person entitled to enforce” an

instrument includes “the holder of the instrument.” R.C. 1303.31. A “holder” means

either of the following: (a) if the instrument is payable to bearer, a person who is in

possession of the instrument; (b) if the instrument is payable to an identified person, the

identified person when in possession of the instrument.” R.C. 1301.01.


2
  R.C. 1301.01 was repealed by Am.H.B. No. 9, 2011 Ohio Laws File 9, effective
June 29, 2011. That act amended the provisions of R.C. 1301.01 and renumbered that
section so that it now appears at R.C. 1301.201. Because R.C. 1301.201 only applies to
transactions entered on or after June 29, 2011, we apply R.C. 1301.01 to this appeal.




8.
       {¶ 26} In this case, the assignment of the mortgage from Paragon Home Lending,

LLC to appellee was notarized on March 15, 2010, and then recorded on March 19, 2010.

Appellee filed suit more than six months later, on October 6, 2010, with the assignment

of the mortgage attached to the complaint as exhibit C. Thus, appellee held the mortgage

prior to the commencement of the action and was entitled to enforce it under R.C.

1301.01. Further, appellee had standing to sue, as a matter of law, pursuant to

Schwartzwald.

       {¶ 27} Moreover, contrary to appellants’ claim, there is no “unexplained gap” in

the chain of assignments. As noted, the appellee was the original plaintiff. On

August 22, 2011, it moved to substitute Bank of America, N.A. as the proper plaintiff. In

support, it filed an “Assignment of Note and Mortgage,” dated August 2, 2011, from

appellee to Bank of America, N.A. The trial court granted the motion. The note and

mortgage were assigned back to appellee, on April 23, 2012, and the appellee was, again,

substituted as the proper plaintiff on May 8, 2012. Appellants’ second argument is not

well-taken.

       {¶ 28} Based upon the record before us, we also find that appellee established the

remaining prima facie elements to satisfy its foreclosure case. We note the affidavit by

Chelsea Kendle filed in support of appellee’s motion for summary judgment. Ms. Kendle

is an authorized agent of Bank of America, N.A., which serviced the subject loan on

appellee’s behalf.




9.
       {¶ 29} The affiant established that she had personal knowledge of appellants’ loan

records; that she had personal knowledge of the manner in which Bank of America, N.A.

kept and maintained its business records, specifically that the records were created in the

course of Bank of America, N.A.’s regularly conducted business activities at or near the

time of appellants’ default; and that appellee was in possession of the note.

       {¶ 30} In addition, the affiant established that appellants failed to make payments

due for December 1, 2009, or any subsequent installments, and that, as of November 1,

2009, appellants owed $580,045.38 in principal, plus interest. Attached to the affidavit

were copies of the note, the mortgage, the assignments of note and mortgage, and the

account history of the loan.

       {¶ 31} In sum, we find that appellee established the prima facie elements of its

foreclosure case, and appellants did not set forth any specific facts demonstrating a

genuine issue of material fact. The trial court’s grant of summary judgment to appellee

was proper. Appellants’ first and second assignments of error are without merit.

       {¶ 32} Having found appellants’ assignments of error not well-taken, we hereby

affirm the judgment of Erie County Court of Common Pleas. Costs are assessed to

appellants in accordance with App.R. 24.


                                                                        Judgment affirmed.




10.
                                                               Deutsche Bank Natl.
                                                               Trust Co. v. Dowd
                                                               C.A. No. E-13-043




       A certified copy of this entry shall constitute the mandate pursuant to App.R. 27.
See also 6th Dist.Loc.App.R. 4.




Mark L. Pietrykowski, J.                       _______________________________
                                                           JUDGE
Thomas J. Osowik, J.
                                               _______________________________
James D. Jensen, J.                                        JUDGE
CONCUR.
                                               _______________________________
                                                           JUDGE


           This decision is subject to further editing by the Supreme Court of
      Ohio’s Reporter of Decisions. Parties interested in viewing the final reported
           version are advised to visit the Ohio Supreme Court’s web site at:
                 http://www.sconet.state.oh.us/rod/newpdf/?source=6.




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