[Cite as Bank of Am., N.A. v. Loya, 2014-Ohio-2750.]


STATE OF OHIO                    )                          IN THE COURT OF APPEALS
                                 )ss:                       NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT                 )

BANK OF AMERICA, N.A.                                       C.A. No.   26973

        Appellee

        v.                                                  APPEAL FROM JUDGMENT
                                                            ENTERED IN THE
DUANE LOYA, et al.                                          COURT OF COMMON PLEAS
                                                            COUNTY OF SUMMIT, OHIO
        Appellants                                          CASE No.   CV 2012 05 2953

                                DECISION AND JOURNAL ENTRY

Dated: June 25, 2014



        MOORE, Presiding Judge.

        {¶1}    Defendant-Appellant, Duane Loya, appeals from the judgment of the Summit

County Court of Common Pleas, granting summary judgment and approving a decree of

foreclosure in favor of Plaintiff-Appellee, Bank of America, N.A. (“Bank of America”). This

Court reverses.

                                                       I.

        {¶2}    On February 17, 2009, Mr. Loya executed a note in the amount of $181,473 in

favor of EverBank for property located at 3167 Englewood Drive in Stow. The note was secured

by a mortgage in favor of EverBank, executed the same day, on the same property. The

mortgage named Mortgage Electronic Registration System, Inc. (“MERS”) as EverBank’s

nominee. It was recorded on February 25, 2009.
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       {¶3}    On May 18, 2012, Bank of America filed a complaint for foreclosure against Mr.

Loya, as the current holder of his note and mortgage.1 Bank of America alleged that Mr. Loya

had defaulted on his loan payments and, pursuant to the terms of the note and mortgage, Bank of

America was entitled to accelerate the balance of his loan. Bank of America sought judgment in

the amount of $179,927.43, at an interest rate of 5%, as well as a decree of foreclosure.

       {¶4}    After Mr. Loya filed his answer, Bank of America filed a motion for summary

judgment. Mr. Loya opposed the motion. Bank of America then filed a reply, and Mr. Loya

filed a surreply. Upon its consideration of the parties’ respective filings, the trial court granted

Bank of America’s motion for summary judgment. The court ordered foreclosure and awarded

Bank of America $179,927.43, plus interest and late fees from October 1, 2009.

       {¶5}    Mr. Loya now appeals from the court’s judgment and raises four assignments of

error for our review.     For ease of analysis, we rearrange and consolidate several of the

assignments of error.

                                                II.

                                ASSIGNMENT OF ERROR II

           THE TRIAL COURT ERRED WHEN IT GRANTED [BANK OF
           AMERICA] SUMMARY JUDGMENT BASED UPON THE HEARSAY
           TESTIMONY CONTAINED WITHIN THE AFFIDAVIT OFFERED IN
           SUPPORT OF SUMMARY JUDGMENT[.]

                                ASSIGNMENT OF ERROR IV

           THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT
           AWARDED SUMMARY JUDGMENT IN FORECLOSURE WHEN [BANK
           OF AMERICA] FAILED TO OFFER ANY EVIDENCE WHATSOEVER
           THAT IT WAS THE ASSIGNEE OF THE NOTE OR MORTGAGE.




1
 The suit also named Candy Loya as a defendant. Because Ms. Loya is not a party on appeal,
we limit our discussion to the suit against Mr. Loya.
                                                  3


       {¶6}    In his second assignment of error, Mr. Loya argues that the trial court erred by

granting Bank of America’s motion for summary judgment because the bank’s affiant lacked

personal knowledge to attest to the bank’s possession of his note and mortgage. In his fourth

assignment of error, Mr. Loya argues that the court erred by granting the bank’s motion because

the bank lacked standing to file its foreclosure complaint. Because the assignments of error are

interrelated, we address them together.

       {¶7}    An appellate court reviews an award of summary judgment de novo. Grafton v.

Ohio Edison Co., 77 Ohio St.3d 102, 105 (1996). It applies the same standard as the trial court,

viewing the facts of the case in the light most favorable to the non-moving party and resolving

any doubt in favor of the non-moving party. Viock v. Stowe-Woodward Co., 13 Ohio App.3d 7,

12 (6th Dist.1983). Pursuant to Civ.R. 56(C), summary judgment is proper if:

       (1) No genuine issue as to any material fact remains to be litigated; (2) the
       moving party is entitled to judgment as a matter of law; and (3) it appears from
       the evidence that reasonable minds can come to but one conclusion, and viewing
       such evidence most strongly in the favor of the party against whom the motion for
       summary judgment is made, that conclusion is adverse to that party.

Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977). The moving party bears the initial

burden of informing the trial court of the basis for the motion and pointing to parts of the record

that show the absence of a genuine issue of material fact. Dresher v. Burt, 75 Ohio St.3d 280,

292-93 (1996). Once this burden is satisfied, the non-moving party bears the burden of offering

specific facts to show a genuine issue for trial. Id. at 293; Civ.R. 56(E).

       {¶8}    “It is fundamental that a party commencing litigation must have standing to sue in

order to present a justiciable controversy and invoke the jurisdiction of the common pleas court.”

Federal Home Loan Mortg. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, ¶ 41.

“The lack of standing at the commencement of a foreclosure action requires dismissal of the
                                                4


complaint * * *.” Id. at ¶ 40. Pursuant to Civ.R. 17(A), actions must be prosecuted in the name

of the real party in interest. “The real party in interest in a foreclosure action is the current

holder of the note and mortgage.” (Internal quotations and citations omitted.) U.S. Bank v.

Cooper, 9th Dist. Medina No. 12CA0084-M, 2014-Ohio-61, ¶ 11. “A ‘holder’ of a note made

payable to an identified person is that person when in possession of the note.” Bank of New York

Mellon Trust Co. Natl. v. Mihalca, 9th Dist. Summit No. 25747, 2012-Ohio-567, ¶ 12, citing

R.C. 1301.201(B)(21)(a).     If an instrument is endorsed in blank, “the instrument becomes

payable to bearer and may be negotiated by transfer of possession alone.” R.C. 1303.25(B).

“Further, a party may gain interest in a note or mortgage through a chain of mergers.” (Internal

citations omitted.) Bank of America, N.A. v. McCormick, 9th Dist. Summit No. 26888, 2014-

Ohio-1393, ¶ 8.

       {¶9}     Bank of America filed two affidavits in support of its motion for summary

judgment.     In the first affidavit, Tara Marie Bradley identified herself as an assistant vice

president of Bank of America and averred that she was authorized to sign her affidavit on the

bank’s behalf. Ms. Bradley averred that Bank of America maintained records “for the subject

loan” and she had “personal knowledge of [the bank’s] procedures for creating these records.”

Ms. Bradley did not describe her specific job duties at Bank of America, but stated that “[a]s part

of [her] job responsibilities * * *, [she] [was] familiar with the type of records maintained by

[Bank of America] in connection with the Loan.” She further stated that she personally reviewed

“the attached records” and made her affidavit “from a review of those business records and from

[her] personal knowledge of how said records are created and maintained.” According to Ms.

Bradley, Bank of America, “directly or through an agent, has possession of the promissory note”

and “is the assignee of the security instrument for the referenced loan.” The only item attached
                                                  5


to Ms. Bradley’s affidavit, however, was an account information statement from Bank of

America for Mr. Loya’s account.

        {¶10} In the second affidavit, Arsheen Littlejohn identified herself as an assistant vice

president of Bank of America and averred that she was authorized to sign her affidavit on the

bank’s behalf. Ms. Littlejohn averred that Bank of America maintained records “for the subject

loan” and that she had “knowledge of [the bank’s] procedures for creating these records.”

Identical to Ms. Bradley, Ms. Littlejohn did not describe her specific job duties at Bank of

America, but stated that “[a]s part of [her] job responsibilities * * *, [she] [was] familiar with the

type of records maintained by [Bank of America] in connection with the Loan.” Identical to Ms.

Bradley, she stated that she personally reviewed “the attached records” and made her affidavit

“from a review of those business records and from [her] knowledge of how said records are

created and maintained.” According to Ms. Littlejohn, “Bank of America, N.A. directly or

through an agent, has possession of [Mr. Loya’s] promissory note and held the note at the time of

filing the foreclosure complaint.” She further averred that Bank of America was the assignee of

Mr. Loya’s mortgage and that “[t]rue and exact copies of the note and mortgage” were attached

to her affidavit.

        {¶11} The copy of the note attached to Ms. Littlejohn’s affidavit contains three

endorsements, following Mr. Loya’s signature.           One endorsement is an endorsement by

EverBank, the original lender, to Countrywide Bank, FSB.               Another endorsement is an

endorsement by Countrywide Bank, FSB, to Bank of America. Finally, Bank of America

endorsed the note in blank. Because the note was endorsed in blank, Bank of America needed to

demonstrate that it had possession of the note in order to be its holder. See R.C. 1303.25(C).

See also Deutsche Bank v. Holloway, 9th Dist. Lorain No. 12CA010331, 2013-Ohio-5194, ¶ 8.
                                                 6


To that end, both Ms. Bradley and Ms. Littlejohn averred in their respective affidavits that Bank

of America, directly or through an agent, had possession of the note. Ms. Littlejohn went further

and averred that possession was had at the time Bank of America filed the complaint against Mr.

Loya. A question remains, however, as to whether either Ms. Bradley or Ms. Littlejohn had the

knowledge necessary to make the foregoing statements.

       {¶12} “[A]ffidavits submitted in support of or in opposition to motions for summary

judgment ‘shall be made on personal knowledge, shall set forth such facts as would be

admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the

matters stated in the affidavit.’” Maxum Indemnity Co. v. Selective Ins. Co. of S.C., 9th Dist.

Wayne No. 11CA0015, 2012-Ohio-2115, ¶ 18, quoting Civ.R. 56(E).                Generally, “a mere

assertion of personal knowledge satisfies the personal knowledge requirement of Civ.R. 56(E) if

the nature of the facts in the affidavit combined with the identity of the affiant creates a

reasonable inference that the affiant has personal knowledge of the facts in the affidavit.” Bank

One, N.A. v. Lytle, 9th Dist. Lorain No. 04CA008463, 2004-Ohio-6547, ¶ 13. “If particular

averments contained in an affidavit suggest that it is unlikely that the affiant has personal

knowledge of those facts, [however,] then * * * something more than a conclusory averment that

the affiant has knowledge of the facts [is] required.” (Internal quotations and citations omitted.)

Bank One v. Swartz, 9th Dist. Lorain No. 03CA008308, 2004-Ohio-1986, ¶ 14. This Court

“cannot infer personal knowledge from the averment of personal knowledge alone.” Maxum

Indemnity Co. at ¶ 22.

       {¶13} {¶17} Although Ms. Bradley and Ms. Littlejohn identified themselves as

assistant vice presidents of Bank of America and both averred that they had familiarity with the

“type of records” at issue in this case “[a]s part of [their] job responsibilities,” neither of them
                                                 7


explained what their job responsibilities actually entailed. See Mihalca, 2012-Ohio-567, at ¶ 17

(affiant’s personal knowledge questioned, in part, due to her failure to state how her position

made her familiar with the borrower’s account records). Even assuming that their affidavits

established their personal knowledge of Bank of America’s business records, however, both

acknowledged that they made their affidavits based on their review of the business records

attached to those affidavits. The only item attached to Ms. Bradley’s affidavit was an account

information statement. The account information statement does not disclose when, if ever, Bank

of America came into possession of the note. Indeed, it does not provide the reader with any

information about the note. It only contains a list of payments on an account, purportedly

attributed to Mr. Loya. Thus, Ms. Bradley, whose knowledge came from her review of the

account information statement, could not have had personal knowledge of when, if ever, Bank of

America came into possession of the note. See Maxum Indemnity Co. at ¶ 18.

       {¶14} As for Ms. Littlejohn, a copy of Mr. Loya’s note was attached to her affidavit, but

the note contains an undated, blank endorsement. Because Mr. Loya’s note is endorsed in blank,

it does not, on its face, establish the entity in possession of it or when that possession occurred.

See Cooper, 2014-Ohio-61, at ¶ 15; Holloway, 2013-Ohio-5194, at ¶ 8-9. Ms. Littlejohn could

not have had personal knowledge of when Bank of America came into possession of the note

based strictly on the note itself. The only other items attached to her affidavit that might possibly

relate to the note are two pages that appear to be computer screen printouts regarding Mr. Loya’s

note. The second page is labeled “Document Management Services Location” and lists Recon

Trust Company, N.A. as custodian of a “Collateral File.” Ms. Littlejohn’s affidavit makes no

attempt to explain the relevance of the computer screen printouts or the identity of Recon Trust

Company, N.A. Moreover, the printouts are dated January 14, 2013, a date well after Bank of
                                                8


America filed its complaint against Mr. Loya. Having reviewed the business records attached to

Ms. Littlejohn’s affidavit, we cannot conclude that a review of the records would have allowed

her to attest to the fact that Bank of America was in possession of Mr. Loya’s note at the time it

filed suit against him. See Maxum Indemnity Co. at ¶ 18.

       {¶15} As previously noted, “[t]he real party in interest in a foreclosure action ‘is the

current holder of the note and mortgage.’” Quantum Servicing Corp. v. Haugabrook, 9th Dist.

Summit No. 26542, 2013-Ohio-3516, ¶ 8, quoting Wells Fargo Bank N.A. v. Horn, 9th Dist.

Lorain No. 12CA010230, 2013-Ohio-2374, ¶ 10. Bank of America’s affiants lacked personal

knowledge to attest to the fact that Bank of America had possession of Mr. Loya’s note at the

time it filed suit against him. To determine that Bank of America held the note at the time that it

filed the complaint, this Court would have to make inferences on its behalf. At the summary

judgment stage, however, evidence must be viewed and inferences must be drawn in a light most

favorable to the non-moving party. Stewart v. Urig, 176 Ohio App.3d 658, 2008-Ohio-3215, ¶

10 (9th Dist.), quoting Harry London Candies, Inc. v. Bernie J. Kosar Greeting Card Co., 9th

Dist. Summit No. 20655, 2002 WL 185305, *3 (Feb. 6, 2002). Viewing the evidence in a light

most favorable to Mr. Loya, we must conclude that Bank of America failed to establish that it

was the holder of his note at the time that it filed suit against him. As such, Bank of America

was not entitled to summary judgment. See Cooper at ¶ 15 (complaint dismissed where no

indication in record when plaintiff bank became holder of the note, which contained undated

allonges); BAC Home Loan Serv. v. McFerren, 9th Dist. No. 26384, 2013-Ohio-3228, ¶ 9

(genuine issues where note endorsed in blank and bank failed to set forth evidence demonstrating

it had possession of the note at the time it filed the complaint).           In accordance with
                                                 9


Schwartzwald, this Court sustains Mr. Loya’s second and fourth assignments of error and orders

the trial court to dismiss the complaint without prejudice.

                                 ASSIGNMENT OF ERROR I

       THE TRIAL COURT ERRED WHEN IT GRANTED SUMMARY JUDGMENT
       TO [BANK OF AMERICA] NOTWITHSTANDING THE FAILURE OF
       [BANK OF AMERICA] TO DEMONSTRATE COMPLIANCE WITH THE
       HUD REGULATIONS THAT ARE A CONDITION PRECEDENT TO THE
       ACCELERATION OF THE NOTE AND FORECLOSURE OF THE
       MORTGAGE[.]

                                ASSIGNMENT OF ERROR III

       THE COURT ERRED WHEN IT AWARDED SUMMARY JUDGMENT TO
       [BANK OF AMERICA] WHEN THERE WAS A MATERIAL QUESTION OF
       FACT REGARDING CONFLICTING ENDORSEMENTS ON THE NOTE
       FILED IN SUPPORT OF LOYA I AND LOYA II[.]

       {¶16} In his first assignment of error, Mr. Loya argues that the trial court erred by

granting Bank of America’s motion for summary judgment because the bank failed to show that

it complied with a condition precedent to acceleration and foreclosure. In his third assignment of

error, Mr. Loya argues that the trial court erred by granting Bank of America’s motion for

summary judgment because conflicting endorsements on his note raised a genuine issue of

material fact for trial. Because we have already determined that the complaint against Mr. Loya

must be dismissed, the foregoing assignments of error are moot. Therefore, we decline to

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

                                                III.

       {¶17} Mr. Loya’s second and fourth assignments of error are sustained. His remaining

assignments of error are moot. The judgment of the Summit County Court of Common Pleas is

reversed, and the cause is remanded for further proceedings consistent with the foregoing

opinion.
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                                                                              Judgment reversed,
                                                                             and cause remanded.




       There were reasonable grounds for this appeal.

       We order that a special mandate issue out of this Court, directing the Court of Common

Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy

of this journal entry shall constitute the mandate, pursuant to App.R. 27.

       Immediately upon the filing hereof, this document shall constitute the journal entry of

judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the

period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is

instructed to mail a notice of entry of this judgment to the parties and to make a notation of the

mailing in the docket, pursuant to App.R. 30.

       Costs taxed to Appellee.




                                                     CARLA MOORE
                                                     FOR THE COURT



BELFANCE, J.
HENSAL, J.
CONCUR.


APPEARANCES:

JAMES R. DOUGLASS, Attorney at Law, for Appellant.

SARAH E. LEIBEL, Attorney at Law, for Appellee.
