[Cite as Everbank v. Vanarnhem, 2013-Ohio-3872.]




                     IN THE COURT OF APPEALS OF OHIO
                         THIRD APPELLATE DISTRICT
                              UNION COUNTY




EVERBANK,

        PLAINTIFF-APPELLEE,
                                                       CASE NO. 14-13-02
        v.

JAY B. VANARNHEM,

        DEFENDANT-APPELLANT,
        -and-                                          OPINION

JP MORGAN CHASE BANK, N.A., ET AL.,

        DEFENDANTS-APPELLEES.




                 Appeal from Union County Common Pleas Court
                           Trial Court No. 12 CV 0060

                                   Judgment Affirmed

                         Date of Decision: September 9, 2013




APPEARANCES:

        Audra J. Tidball for Appellant, Vanarnhem

        Scott A. King and Jessica E. Salisbury for Appellee, Everbank
Case No. 14-13-02



PRESTON, P.J.

      {¶1} Defendant-appellant, Jay B. Vanarnhem, appeals the Union County

Court of Common Pleas’ judgment entry of foreclosure. We affirm.

      {¶2} On August 9, 2005, Vanarnhem executed an interest-first adjustable-

rate promissory note in the amount of $276,850.00 payable to M/I Financial

Corporation as lender to purchase a home located at 7036 Post Preserve

Boulevard, Dublin, OH 43016. (Doc. No. 2, attached); (Cliatt Aff., Doc. No. 26,

at ¶ 5); (Weatherly Aff., Doc. No. 42, at ¶ 6). The note was indorsed by Wells

Fargo Bank, N.A., the servicing agent for the note. (Doc. No. 2, attached); (Cliatt

Aff., Doc. No. 26, at ¶ 1); (Weatherly Aff. Doc. No. 42, at ¶ 1). That same day,

Vanarnhem executed a mortgage against the property to secure the debt in favor of

Mortgage Electronic Registration Systems (“MERS”) as nominee for M/I

Financial and its successors and assigns. (Doc. No. 2, attached); (Cliatt Aff., Doc.

No. 26, at ¶ 6). The mortgage was filed on September 6, 2005, recorded in

Volume 634 of the Official Records at Page 664, in the Union County, Ohio

Recorder’s Office. (Doc. No. 2, attached).

      {¶3} According to the terms of the note, the first five years of payments, up

to and including the September 1, 2010 payment, were interest-only payments.

(Weatherly Aff., Doc. No. 42 at ¶ 9).         Beginning with the October 1, 2010

payment, payments would be made toward interest and principal. (Id. at ¶ 10-11).

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Vanarnhem made the October 1, 2010 payment, of which $620.72 was applied to

principal, $692.13 was applied to interest, and $666.09 was escrowed. (Id. at ¶

13).   Vanarnhem failed to make payments on the note thereafter, leaving a

principal balance of $276,229.28. (Id. at ¶ 14); (Cliatt Aff., Doc. No. 26, at ¶ 8-9).

       {¶4} On January 25, 2012, MERS, as nominee for M/I Financial, assigned

the mortgage to Everbank. (Doc. No. 2, attached). The assignment was recorded

on February 1, 2012 in Volume 949, Page 906 of the Official Records in the

Union County, Ohio Record’s Office.

       {¶5} On February 17, 2012, Everbank filed a foreclosure complaint against

Vanarnhem, his unknown spouse (if any), J.P. Morgan Chase Bank, N.A., Park

Place/Post Preserve Homeowners’ Association, Inc., and the Union County

Treasurer. (Doc. No. 2). Vanarnhem was served with a copy of the complaint by

certified mail on February 24, 2012. (Doc. No. 15).

       {¶6} On February 27, 2012, the Union County Treasurer filed an answer

claiming an interest in the property for current and delinquent taxes. (Doc. No.

20). No other defendant, including Vanarnhem, filed an answer.

       {¶7} On September 27, 2012, Everbank filed a motion for default judgment

against all the named defendants who failed to file an answer, including

Vanarnhem. (Doc. No. 25).




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       {¶8} On October 4, 2012, Vanarnhem filed a motion for leave to file a

responsive pleading alleging that he was unable to previously seek counsel due to

a chronic medical illness that required frequent hospitalization. (Doc. No. 30).

       {¶9} On October 30, 2012, the trial court denied Vanarnhem’s motion,

finding that he failed to demonstrate excusable neglect under Civ.R. 6(B)(2).

(Doc. No. 31). That same day, the trial court granted Everbank’s motion for

default judgment but held the motion in abeyance on the issue of damages upon

Everbank filing supporting documentation. (Doc. No. 33).

       {¶10} On November 7, 2012, Vanarnhem filed a motion for reconsideration

and motion to dismiss the complaint pursuant to Civ.R. 12(B)(1) and Fed. Home

Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017. (Doc.

No. 35). Everbank filed a memorandum in opposition on November 20, 2012.

(Doc. No. 36).

       {¶11} On November 30, 2012, Everbank filed notice of its compliance with

the trial court’s October 30, 2012 judgment entry and the affidavit of Amanda

Weatherly, the Vice President of Loan Documentation for Wells Fargo Bank,

N.A., representing that, as of August 30, 2012, Vanarnhem owed a total of

$305,365.52 on the note. (Doc. Nos. 41-42)

       {¶12} On December 4, 2012, Vanarnhem filed a reply to Everbank’s

memorandum in opposition. (Doc. No. 44).


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       {¶13} On December 7, 2012, Vanarnhem filed a motion to strike

Weatherly’s affidavit for lack of personal knowledge. (Doc. No. 45).

       {¶14} On December 11, 2012, the trial court denied Vanarnhem’s motion

for reconsideration/dismissal of the complaint. (Doc. No. 47).

       {¶15} On December 21, 2012, Everbank filed a memorandum in opposition

to Vanarnhem’s motion to strike. (Doc. No. 49).

       {¶16} On January 8, 2013, the trial court denied Vanarnham’s motion to

strike and granted Everbank default judgment. (Doc. Nos. 50-51).

       {¶17} On January 24, 2013, Vanarnhem filed a notice of appeal. (Doc. No.

55). Vanarnhem raises three assignments of error for our review.

                            Assignment of Error No. I

       The trial court abused its discretion when it denied Mr.
       Vanarnhem’s Motion For Leave to File an Answer, holding that
       Mr. Vanarnhem’s illness did not constitute excusable neglect
       under Civ.R. 6(B) for failure to timely file his Answer, and doing
       so without holding a hearing.

       {¶18} In his first assignment of error, Vanarnhem argues that the trial court

abused its discretion by denying him leave to file an answer out of rule because he

had a serious medical illness requiring frequent hospitalization and Everbank did

not request default judgment until nearly eight months after the complaint was

filed. Vanarnhem also argues that the trial court abused its discretion by failing to

hold a hearing on the motion for leave.


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       {¶19} The defendant is required to file an answer within 28 days after

service of the summons and complaint upon him.           Civ.R. 12(A)(1).     Civ.R.

6(B)(2) provides the trial court broad, but not unlimited, discretion to extend this

time limit upon motion after the time limit’s expiration where the party’s failure to

act was due to excusable neglect. Davis v. Immediate Med. Servs., Inc., 80 Ohio

St.3d 10, 14 (1997). A reviewing court will not reverse a trial court’s decision to

deny a Civ.R. 6(B)(2) motion for an extension of time absent an abuse of

discretion. Id., citing Marion Prod. Credit Assn. v. Cochran, 40 Ohio St.3d 265,

271 (1988).    The term “abuse of discretion” connotes more than an error of

judgment; rather, it implies that the court’s attitude is unreasonable, arbitrary, or

unconscionable. Rock v. Cabral, 67 Ohio St.3d 108, 112 (1993).

       {¶20} “Although excusable neglect cannot be defined in the abstract, the

test for excusable neglect under Civ.R. 6(B)(2) is less stringent than that applied

under Civ.R. 60(B).” State ex rel. Lindenschmidt v. Butler Cty. Bd. of Commrs.,

72 Ohio St.3d 464, 466 (1995). To determine whether neglect is excusable or

inexcusable, the trial court must evaluate all the surrounding facts and

circumstances ever-mindful that cases should be decided, where possible, on the

merits rather than on procedural grounds. Id., citing Cochran, 40 Ohio St.3d at

271; Griffey v. Rajan, 33 Ohio St.3d 75 (1987), syllabus.




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         {¶21} Vanarnhem argues that he demonstrated excusable neglect because

he suffers from histoplasmosis,1 a debilitating illness which requires frequent

hospitalization.       We conclude, however, that the trial court did not abuse its

discretion by determining that Vanarnhem failed to demonstrate excusable neglect.

To begin with, Vanarnhem failed to file any responsive pleading for almost eight

months, and then only filed his motion for leave after Everbank requested default

judgment. Then, when he did file his motion for leave, Vanarnhem failed to attach

any affidavit or other documentation supporting his alleged debilitating illness. In

his motion for leave, Vanarnhem alleged that he was unable to “retain” counsel

prior to filing his motion, though he sought counsel prior to Everbank’s motion for

default judgment. (Doc. No. 30). It appears that Vanarnhem’s failure to retain

counsel was for financial reasons. (Id.). A litigant’s inability to afford an attorney

is generally not “excusable neglect” under Civ.R. 6(B)(2). Rudolf v. Rudolf, 7th

Dist. Mahoning No. 96 CA 60, *3 (Aug. 26, 1999). See also Doe v. Canton

Regency, 5th Dist. Stark No. 2010 CA 00048, 2010-Ohio-5976, ¶ 65 (failure to

obtain counsel for financial reasons is not excusable neglect under Civ.R.

60(B)(1)); Brooke v. James R. Rea Ents., Inc., 9th Dist. Summit No. 25433, 2011-

Ohio-1531, ¶ 11 (same).


1
  Histoplasmosis is “[a] disease caused by the inhalation of the spores of the fungus Histoplasma
capsulatum. It may affect the lungs and simulate tuberculosis, or it may involve the reticuloendothelial
system, in which case it is marked by fever, loss of weight, enlargement of the liver and spleen, leukopenia,
etc.” 3 J.E. Schmidt, M.D., Attorneys’ Dictionary of Medicine, H-156 (Matthew & Bender 2004).

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       {¶22} Furthermore, while a sudden illness can constitute “excusable

neglect,” a pre-existing, chronic illness is substantially different. Lindenschmidt,

72 Ohio St.3d at 466. See Resolution Trust Corp. v. Maricopa Cty., 176 Ariz. 631,

635, 863 P.2d 923 (1993) (counsel’s Chronic Fatigue Syndrome not a sudden

illness constituting excusable neglect under Civ.R. 60); In re LaClair, 360 B.R.

388, 397-398 (Bankr.D.Mass.2006) (attorney’s long-term/chronic illness not

excusable neglect). A sudden illness, by definition, is unanticipated and may

prevent a party from timely responding. A party suffering from a pre-existing,

chronic illness, on the other hand, knows about the condition and must account for

it when responding to the pleadings. That is not to say that a litigant suffering

from a pre-existing, chronic illness could never demonstrate excusable neglect.

Circumstances related to the pre-existing, chronic illness might arise that could

constitute excusable neglect—we leave that to trial courts’ discretion in individual

cases. This case does not involve circumstances beyond the existence of the pre-

existing, chronic illness itself constituting excusable neglect. Furthermore, the

delay in this case was over eight months; at no time prior to Everbank’s request

for default judgment did Vanarnhem notify the trial court of his medical condition

and seek more time to obtain counsel. Calkins v. Pacel Corp., W.D.Va. No.

3:07cv00025, *3-4 (July 22, 2008) (defendant should have notified the court of the

serious illness in a much more timely fashion, such as by the first missed


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deadline). Under these circumstances, the trial court did not abuse its discretion

by denying Vanarnhem leave to file his untimely answer.

       {¶23} Next Vanarnhem argues that the trial court erred in denying his

motion for leave without first holding a hearing. We disagree. Vanarnhem failed

to request a hearing, and he failed to even attach an affidavit to substantiate his

claims. Beyond that, the Rules of Civil Procedure do not require an oral hearing

on a motion for leave to plead. Tinlin v. White, 7th Dist. Carroll No. 680, *5

(Sept. 20, 1999); Rudolf, 7th Dist. No. 96 CA 60, at * 3. See also Jenkins v. Clark,

7 Ohio App.3d 93 (2d Dist.1982), paragraph two of the syllabus.

       {¶24} Finally, Vanarnhem argues that the trial court erred in denying his

motion for leave because no default judgment had been entered. In support of his

argument, Vanarnhem quotes the following from our decision in Albright v

Cincinnati Equitable Ins.: “when a party answers out of rule but before a default is

entered, if the answer is good in form and substance, a default should not be

entered.” 3d Dist. Crawford No. 3-04-01, 2004-Ohio-4010, ¶ 21. This statement,

viewed in isolation, appears to support Vanarnhem’s argument; however, viewed

in its proper context, this statement merely reflects our observation of courts’

general disfavor for default judgments. Notably, this court was affirming a trial

court’s decision to grant leave in that case. Furthermore, the statement of law

quoted from Albright, supra, originates from cases where defendants who made an


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appearance were not provided notice of the trial court’s default judgment hearing.

Miami Sys. Corp. v. Dry Cleaning Computer Sys. Inc., 90 Ohio App.3d 181, 186

(1st Dist.1993); Suki v. Blume, 9 Ohio App.3d 289, 290 (8th Dist.1983).

       {¶25} In Miami Systems Corp. and Suki, the Court of Appeals for the First

and Eighth Appellate Districts held that the proper procedure would be to strike

the untimely answer from the record before granting the default judgment. Suki at

290-291. It was further held that the defendant who untimely appeared prior to the

entry of default judgment was entitled to notice of the default judgment hearing

regardless of the fact that he would not be permitted to proceed on his untimely

pleading. Id. Vanarnhem had notice of the motion for default judgment in this

case and responded with a motion for leave to file an untimely answer. This case

did not involve a failure to provide notice of the default judgment hearing like the

cases from which the rule Vanarnhem cites stems. There was no default judgment

hearing in this case.

       {¶26} Vanarnhem’s first assignment of error is, therefore, overruled.

                           Assignment of Error No. II

       The trial court erred as a matter of law when it denied Mr.
       Vanarnhem’s Motion for Reconsideration and to Dismiss
       Everbank’s Complaint, holding that Mr. Vanarnhem waived his
       attack on the trial court’s subject matter jurisdiction when he
       failed to timely file an Answer, and that Everbank had standing
       to bring the action.



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       {¶27} In his second assignment of error, Vanarnhem argues that the trial

court should have dismissed the complaint for lack of subject-matter jurisdiction

because Everbank lacked standing.          In particular, Vanarnhem argues that

Everbank lacked standing because it was not a holder of the promissory note until

nearly eight months after it brought the action.

       {¶28} “The courts of common pleas and divisions thereof shall have such

original jurisdiction over all justiciable matters and such powers of review of

proceedings of administrative officers and agencies as may be provided by law.”

(Emphasis added). Ohio Constitution, Article IV, Section 4(B).

       {¶29} “‘Standing to sue is part of the common understanding of what it

takes to make a justiciable case.’”        Federal Home Loan Mortg. Corp. v.

Schwartzwald, 2012-Ohio-5017, at ¶ 21, quoting Steel Co. v. Citizens for a Better

Environment, 523 U.S. 83, 102, 118 S.Ct. 1003 (1998). Because standing is

required to invoke the jurisdiction of the common pleas court, standing is

determined as of the commencement of suit, i.e. the filing of the complaint.

Schwartzwald at ¶ 24, 27 (citations omitted).

       {¶30} Subject-matter jurisdiction relates to the power of the trial court to

hear the case; it can never be waived and may be raised at any time during the

proceedings. Pratts v. Hurley, 102 Ohio St.3d 81, 2004-Ohio-1980, ¶ 11. We




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review the issue of subject-matter jurisdiction de novo. State ex rel. Post v. Speck,

185 Ohio App.3d 828, 2010-Ohio-105, ¶ 10 (3d Dist.).

       {¶31} Vanarnhem argues that the trial court erred by failing to dismiss the

complaint for lack of subject-matter jurisdiction because Everbank failed to attach

documents to its complaint demonstrating that it had standing when the complaint

was filed.    In support of this argument, Vanarnhem relies exclusively upon

Schwartzwald, 2012-Ohio-5017. In Schwartzwald, the court determined that a

plaintiff receiving an assignment of a note and mortgage from the real party in

interest subsequent to the filing of the complaint, but prior to the entry of

judgment, does not cure a lack of standing to file a foreclosure action. In that

case, the plaintiff conceded that the record failed to establish that it was a person

entitled to enforce the promissory note as of the date the complaint was filed. Id.

at ¶ 18, 28. In fact, the record affirmatively demonstrated that the assignment of

the note and mortgage to the plaintiff occurred a month after the complaint was

filed. Id. at ¶ 7, 10.

       {¶32} The record in this case, unlike the record in Schwartzwald,

demonstrates that MERS as nominee for M/I Financial Corporation, the original

lender, assigned the mortgage to Everbank on January 25, 2012. (Doc. No. 2).

The assignment of the mortgage was recorded on February 1, 2012. (Id.). The

complaint in this case was filed on February 17, 2012. (Id.). The promissory note


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that was attached to the complaint was indorsed “PAY TO THE ORDER OF

WELLS FARGO BANK, N.A. without recourse this 9th day of August 2005” and

signed by Jason K. Ellis, Assistant Secretary of M/I Financial Corp.           (Id.).

However, after Vanarnhem filed his motion to dismiss, Everbank filed another

copy of the promissory note, which Wells Fargo Bank indorsed in blank, along

with the affidavit Amanda Weatherly, the Vice President of Loan Documentation

for Wells Fargo Bank, the servicing agent of Everbank, averring that Everbank

was in possession of the promissory note prior to the filing of the foreclosure

complaint. (Doc. No. 42). Because Everbank was in possession of a negotiable

instrument that was payable to bearer, it was a holder entitled to enforce the

negotiable instrument.     R.C. 1301.201(B)(21)(a), 1303.31(A)(1), 1303.25(B).

Furthermore, because Everbank was a holder of the promissory note at the time

the complaint was filed, it had standing to file the foreclosure complaint triggering

the trial court’s subject-matter jurisdiction. Schwartzwald at ¶ 28.

       {¶33} Vanarnhem argues that, per Schwartzwald, Everbank’s subsequent

filing of the promissory note with an endorsement in blank could not create

standing after the fact. Although Everbank could not subsequently become a

holder of the promissory note after the filing of the complaint to cure its lack of

standing at the time of the filing of the complaint per Schwartzwald, Everbank

could file supplemental documentation subsequent to the filing of the complaint


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showing that it had standing at the time of the complaint. A trial court is not

confined to the allegations of the complaint when considering the issue of subject-

matter jurisdiction and may consider affidavits and testimony for that purpose.

Southgate Dev. Corp. v. Columbia Gas Transm. Corp., 48 Ohio St.2d 211 (1976),

paragraph one of the syllabus; Kuhn v. Schmidt Bros., Inc., 6th Dist. Lucas No. L-

07-1235, 2008-Ohio-1567, ¶ 10; Linkous v. Mayfield, 4th Dist. Scioto No.

CA1894, *4 (June 4, 1991). The affidavit of the bank’s loan servicing agent, like

Weatherly herein, along with other supporting documents, such as the submitted

copy of the promissory note indorsed in blank, is sufficient to show that Everbank

had standing. See, e.g., Deutsche Bank Natl. Trust Co. v. Gardner, 8th Dist.

Cuyahoga No. 92916, 2010-Ohio-663, ¶ 10 (servicer of borrower’s loan

competent to testify regarding the content of documents in borrower’s loan file

with which he was personally familiar); Deutsche Bank Natl. Trust Co. v. Ingle,

8th Dist. Cuyahoga No. 92487, 2009-Ohio-3886, ¶ 9, 18 (affidavit of bank’s loan

servicing agent, along with other supporting documents, sufficient to show bank

was the real party in interest); New York v. Dobbs, 5th Dist. Knox No. 2009-CA-

000002, 2009-Ohio-4742, ¶ 40 (“even though * * * not employed by” appellee,

affidavit of loan servicing agent was sufficient to authenticate documents).

Therefore, we reject Vanarnhem’s argument that Everbank was not permitted to




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submit documentation to establish its standing at the time of the filing of the

complaint.

          {¶34} Because Everbank was the holder of the promissory note and had

legal title to the mortgage2 prior to the filing of the complaint, it had standing to

bring the foreclosure action; and therefore, the trial court had jurisdiction over the

action.

          {¶35} Vanarnhem’s second assignment of error is, therefore, overruled.

                                 Assignment of Error No. III

          The trial court abused its discretion when it denied Mr.
          Vanarnhem’s Motion to Strike Everbank’s Affidavit Regarding
          Judgment Figures.

          {¶36} In his third assignment of error, Vanarnhem argues that the trial court

abused its discretion by failing to strike portions of the affidavit in support of

Everbank’s judgment figures concerning Everbank’s possession and right to

enforce the note and mortgage because it exceeded the trial court’s order, and the

affiant was an employee of a third-party with no personal knowledge of

Everbank’s business records.

          {¶37} A trial court has broad discretion in determining whether to grant a

motion to strike. State ex rel. Ebbing v. Ricketts, 133 Ohio St.3d 339, 2012-Ohio-

4699, ¶ 13. Consequently, a trial court’s ruling on a motion to strike will not be

2
 Because Everbank was a holder of the promissory note and had legal title to the mortgage in this case, we
need not address the issues of whether legal title to the mortgage alone is sufficient for standing and
whether the assignment of the mortgage also assigned the right to enforce the promissory note.

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reversed absent an abuse of discretion. State ex rel. Mora v. Wilkinson, 105 Ohio

St.3d 272, 2005-Ohio-1509, ¶ 10. A decision constitutes an abuse of discretion

when it is unreasonable, arbitrary, or unconscionable. Blakemore v. Blakemore, 5

Ohio St.3d 217, 219 (1983).

       {¶38} The trial court did not abuse its discretion by denying Vanarnhem’s

motion to strike the Weatherly affidavit. As an initial matter, the portion of the

affidavit concerning Everbank’s possession of the promissory note was not in

response to the trial court’s order but in response to Vanarnhem’s motion to

dismiss. As we have already stated above, Everbank was permitted to submit

documentation outside of the allegations in the original complaint establishing its

standing and the trial court’s subject-matter jurisdiction.

       {¶39} Vanarnhem argues that the affiant, as an employee of Wells Fargo,

did not have personal knowledge of Everbank’s business records, and therefore,

could not aver that Everbank was in possession of the promissory note prior to the

filing of the complaint. We disagree. Weatherly averred that she is the Vice

President of Loan Documentation for Wells Fargo, the servicing agent for

Everbank. (Doc. No. 42). She further averred that, in her capacity as Vice

President of Loan Documentation, she personally viewed the loan documents and

account records relevant to this case, which are maintained by Wells Fargo, and

her affidavit is based upon her personal inspection of those business records. (Id.).


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Weatherly averred that Everbank was in possession of the original promissory

note prior to the filing of the foreclosure complaint, and that Exhibit A to her

affidavit was a true and accurate copy of the note. (Id.). The attached promissory

note was indorsed in blank. (Id.). As we have already stated above, other courts

have found that the affidavit of an agent of the bank’s loan servicer is sufficient to

authenticate the loan documents. Gardner, 2010-Ohio-663, at ¶ 10; Ingle, 2009-

Ohio-3886, at ¶ 9, 18; Dobbs, 2009-Ohio-4742, at ¶ 40; Deutsche Bank Natl. Trust

Co. v. Cassens, 10th Dist. Franklin No. 09AP-865, 2010-Ohio-2851, ¶ 18.

Therefore, we cannot conclude that the trial court abused its discretion by failing

to strike Weatherly’s affidavit.

       {¶40} Vanarnhem’s third assignment of error is, therefore, overruled.

       {¶41} Having found no error prejudicial to the appellant herein in the

particulars assigned and argued, we affirm the judgment of the trial court.

                                                                 Judgment Affirmed

SHAW, J., concurs.

/jlr




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ROGERS, J., dissents.

        {¶42} Because the majority erroneously relies on the assignment of the

mortgage by MERS to Everbank in concluding that Everbank was a holder with

the necessary standing to bring this foreclosure action, I respectfully dissent.

        {¶43} For the reasons more fully stated in my dissent in Countrywide Home

Loans Servicing, L.P. v. Shifflet, 3d Dist. Marion No. 9-09-31, 2010-Ohio-1266

(Rogers, J., dissenting), I believe that the record does not support a finding that

Everbank has standing as a holder of the mortgage to bring this action.3 MERS

was merely designated as M/I Financial’s “nominee,” meaning that no real interest

in the subject property was transferred to MERS. Accordingly, MERS had no

holder interest in the property when it conveyed the mortgage to Everbank. As a

result, Everbank, as MERS’s assignee, is likewise deprived of a holder interest in

the subject property and cannot bring a foreclosure action as a holder of the

mortgage.

        {¶44} The majority also finds that Everbank is the holder of the note.

While the record does support this finding, it is ultimately immaterial to the

disposition of this matter. E.g., Wells Fargo Bank, N.A. v. Sessley, 188 Ohio

App.3d 213, 2010-Ohio-2902, ¶ 11 (10th Dist.) (“In foreclosure actions, [the entity


3
  It may be possible that Everbank is a non-holder in possession with the rights of a holder and is thus
entitled to enforce the mortgage on that basis. See Wells Fargo Bank, N.A. v. Freed, 3d Dist. Hancock No.
5-12-01, 2012-Ohio-5941, ¶ 28-30 (affirming trial court’s grant of foreclosure where plaintiff was a non-
holder in possession with the rights of a holder). However, Everbank has not argued this on appeal.

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with standing] is the current holder of the note and the mortgage.”); Wells Fargo

Bank, N.A. v. Byrd, 1st Dist. Hamilton Nos. C-070889, C-070890, 2008-Ohio-

4603, ¶ 16 (finding that bank-plaintiff, which was not the holder of the sued upon

mortgage, had no standing to bring foreclosure action).          Merely holding a

promissory note does not entitle a party to bring a foreclosure action, as Everbank

has attempted to do here. Rather, holding a promissory note only entitles a party

to bring an action for money damages arising from a breach of the note. See

Union Bank Co. v. North Carolina Furniture Express, L.L.C., 189 Ohio App.3d

538, 2010-Ohio-4176, ¶ 21 (3d Dist.) (Opinion of Preston, J.) (“‘The right to

judgment on the note is one cause of action. The right to foreclose a mortgage is

another cause of action. One is legal – the other is equitable.’”), quoting Fifth

Third Bank v. Hopkins, 177 Ohio App.3d 114, 2008-Ohio-2959, ¶ 15 (9th Dist.).

Thus, Everbank’s status as a holder of the note does not cure its lack of standing to

bring a foreclosure action.

       {¶45} Based on the foregoing, I would sustain the second assignment of

error. This disposition would render the first and third assignments of error moot.

See App.R. 12(A)(1)(c).

       {¶46} Accordingly, I would reverse the trial court’s judgment and dismiss

Everbank’s complaint for want of standing to bring a foreclosure action.

/jlr


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