[Cite as Wells Fargo Bank, N.A. v. Bielec, 2014-Ohio-1805.]


                             IN THE COURT OF APPEALS OF OHIO

                                  TENTH APPELLATE DISTRICT

Wells Fargo Bank, N.A.,                              :

                Plaintiff-Appellee,                 :

v.                                                  :                       No. 13AP-330
                                                                       (C.P.C. No. 11CV-0639)
Kathryn A. Bielec aka Kathy Bielec et al., :
                                                                   (REGULAR CALENDAR)
                Defendants-Appellants.              :



                                         D E C I S I O N

                                      Rendered on April 29, 2014


                Thompson Hine, L.L.P., Scott A. King and Terry W. Posey, for
                appellee.

                Paul Wallace, for appellants.

                  APPEAL from the Franklin County Court of Common Pleas

CONNOR, J.
         {¶ 1} Defendants-appellants,           Kathryn       A.   Beilec    and   Robert       J.   Beilec
("appellants"), appeal from a judgment of the Franklin County Court of Common Pleas
granting the motion for summary judgment filed by plaintiff-appellee, Wells Fargo Bank,
N.A. ("Wells Fargo"). For the reasons that follow, we affirm the judgment of the trial
court.
A. Facts and Procedural History
         {¶ 2} In October 2004, appellants' executed a promissory note ("Note") in the
sum of $161,000 in favor of Wells Fargo, and a first mortgage on real property located at
487 Thedri Avenue, Gahanna, Ohio, as security for the borrowed sum ("Mortgage").
When appellants defaulted on payment, Wells Fargo commenced a foreclosure action in
the Franklin County Court of Common Pleas on January 14, 2011. In Count I of the
No. 13AP-330                                                                                 2


complaint, Wells Fargo sought judgment on the note in the amount of $148, 980. 93, plus
interest at 6 percent per annum from March 1, 2010, court costs, advances, and other
allowable charges. In Count II, Wells Fargo sought a judgment of foreclosure and an order
of sale.
        {¶ 3} On July 9, 2012, the trial court denied the parties cross-motions for
summary judgment. A court magistrate subsequently tried the case on November 7, 2012.
On December 5, 2012, the magistrate recommended judgment in favor of Wells Fargo as
to both counts of the complaint. On December 19, 2012, appellants' filed objections to the
magistrate’s decision and a motion to supplement their objections with a copy of the
transcript of proceedings. Appellants' subsequently filed a motion for extension of time to
secure the transcript. On January 9, 2013, the trial court granted appellants leave until
January 31, 2013, to supplement their previously filed objections and to file the transcript
of proceedings. On February 1, 2013, appellants' filed their supplemental objections but
did not file the transcript.
        {¶ 4} On February 7, 2013, Wells Fargo filed their memorandum in opposition to
appellants' original objections. Appellants' subsequently filed the trial transcript on
February 12, 2013, but without the exhibits. The next day, appellants' filed their reply.
Wells Fargo filed its response to appellants' supplemental objections on February 18,
2013.
        {¶ 5} On March 25, 2013, the trial court issued a decision overruling appellants'
objections and adopting the magistrate's decision as its own. The trial court subsequently
issued its judgment entry and decree in foreclosure on March 28, 2013. On that same
date, appellants' filed a copy of the trial transcript, complete with the exhibits.
        {¶ 6} Appellants' filed a timely notice of appeal to this court on April 19, 2013.
B. Assignments of Error
        {¶ 7} Appellants' assign the following as error on appeal:
               I. THE TRIAL COURT ERRED IN FINDING THAT
               PLAINTIFF HAD NOT MODIFIED ITS PROMISSORY NOTE
               AND MORTGAGE.

               II. THE TRIAL COURT ERRED IN FINDING THAT
               PLAINTIFF WAS NOT BARRED FROM ENFRCING (sic) ITS
No. 13AP-330                                                                           3


              NOTE AND MORTGAGE UNDER THE DOCTRINE OF
              PROMISSORY ESTOPPEL.

C. Standard of Review
       {¶ 8} When reviewing a trial court's adoption of a magistrate's decision, we
generally apply an abuse of discretion standard. Wells Fargo Bank, N.A. v. Rahman, 10th
Dist. No. 13AP-376, 2013-Ohio-5037, citing Mayle v. Ohio Dept. of Rehab. & Corr., 10th
Dist. No. 09AP-541, 2010-Ohio-2774, ¶ 15. With respect to the trial court's adoption of a
magistrate's factual findings, Civ.R. 53(D)(3)(b), provides in relevant part:
              (iii) Objection to magistrate's factual finding; transcript or
              affidavit. An objection to a factual finding, whether or not
              specifically designated as a finding of fact under Civ.R.
              53(D)(3)(a)(ii), shall be supported by a transcript of all the
              evidence submitted to the magistrate relevant to that finding.

              (iv) Waiver of right to assign adoption by court as error on
              appeal. Except for a claim of plain error, a party shall not
              assign as error on appeal the court's adoption of any factual
              finding or legal conclusion, whether or not specifically
              designated as a finding of fact or conclusion of law under
              Civ.R. 53(D)(3)(a)(ii), unless the party has objected to that
              finding or conclusion as required by Civ.R. 53(D)(3)(b).

       {¶ 9} The trial court's March 25, 2013 decision contains the following discussion:

              The Court agrees with Plaintiff that, at least as of the time of
              filing their Supplemental Objections on February 1, 2013, the
              transcript of the proceedings had not yet been filed by
              Defendants and that technically, Defendants thus are
              precluded from asserting their objections to any factual
              findings of the Magistrate or any claim that the trial court
              erred in adopting the factual findings. Colo. v. Ledesma, 3rd
              Dist. No. 13-017-02, 2007-Ohio-3975, ¶¶11-13 (2007 Ohio
              App. LEXIS 3594) (citations omitted.) Nonetheless, the Court
              also finds that Plaintiff has not been prejudiced by the
              belated filing of the transcript and accordingly the Court has
              considered it, along with the exhibits that are part of the
              record as of the date of this entry.

(Emphasis added.)
No. 13AP-330                                                                                            4


       {¶ 10} Based upon the foregoing, it is clear that the trial court sua sponte granted
appellants leave to file the transcript. It is also clear that the trial court considered the
transcript in reviewing the magistrate's findings of fact. Additionally, the record contains
a "Notice of Filing of Loan Modification Agreement" that was filed by Wells Fargo on
January 9, 2012. Attached thereto as exhibit "A" is what Wells Fargo represents as a
"Loan Modification Agreement."
       {¶ 11} Inasmuch as the trial court considered the transcript in adopting the
magistrate's decision, we will consult the transcript in our review of the trial court's
decision. Similarly, given the fact that Wells Fargo filed a written loan modification
agreement on January 9, 2012, and given the fact that the trial court expressly considered
"all exhibits that are part of the records as of the date of this entry," we shall consider the
document in reviewing the trial court's adoption of the magistrate's decision. However, to
the extent that appellants now challenge the trial court's adoption of any factual finding
that was based solely upon the exhibits admitted at the bench trial, but not otherwise
appearing in the record, we shall consider such a finding as unchallenged. See Civ.R.
53(D)(3)(b)(iv).1
D. Legal Analysis
       1. Loan Modification
       {¶ 12} In appellants' first assignment of error, appellants argue that the trial court
abused its discretion when it adopted the magistrate's conclusions of law. More
particularly, appellants contend that evidence shows that the parties modified the terms
of the Note and Mortgage. We disagree.
       {¶ 13} Appellants' first claim of error is the trial court's alleged failure to consider
the written loan modification agreement signed by appellants and admitted into evidence
as exhibit No. 4. As noted, appellants' did not timely file the exhibits and they were not
before the trial court when it considered appellants' objections. The trial court stated,
however, that it considered any exhibits that were part of the record at the time it ruled on
the objections, which included the Loan Modification Agreement that Wells Fargo filed on


1Although appellants admit no fault regarding the absence of the exhibits, the burden is upon the party
objecting to a magistrate's factual finding to support its objection with "all the evidence submitted to the
magistrate relevant to that finding." Civ.R. 53(D)(3)(b)(iii).
No. 13AP-330                                                                            5


January 9, 2012. The testimony establishes that exhibit No. 4, is a copy of the very "Loan
Modification Agreement" Wells Fargo filed with the court on January 9, 2012. (Tr. 21, 44-
45.) Accordingly, the record reveals that the trial court did consider the written loan
modification signed by appellants in ruling on the appellants' objections even though the
trial court's decision does not expressly mention it.
       {¶ 14} Appellants also rely on the testimony of appellant, Kathy Beilec, in support
of each of their defenses to the foreclosure action, including loan modification. Beilec
testified that she contacted Wells Fargo by telephone in August of 2009, in order to make
two mortgage payments totaling $2,600. Appellants were three or four months behind in
their payments at that time, but Wells Fargo had not yet sent appellants a notice of
default. According to Beilec, the Wells Fargo representative informed her that appellants
might be eligible for a loan modification under the Home Affordable Modification
Program ("HAMP"), subject to verification of the financial information Bielec had
provided to the representative. The representative reportedly told Bielec to withhold
further mortgage payments until October 1, 2009, at which time appellants were to begin
making reduced payments of $1,007 per month. Bielec did not make the payment she
planned to make.
       {¶ 15} Bielec stated that, thereafter, appellants received a document from Wells
Fargo entitled "Home Affordable Modification Program, Trial Loan Period." According to
Beilec, the document provided that appellants were to commence making reduced
monthly payments of $1,007 until February 2010; that they were to cooperate with Wells
Fargo in providing the information necessary to complete the loan modification process;
and that time was of the essence. Based upon her conversations with Wells Fargo
representatives, Beilec believed that by providing the required documents to Wells Fargo
and making the payments as scheduled, Wells Fargo would approve the loan modification
and execute a loan modification agreement.          Appellants signed the document and
returned it to Wells Fargo. Wells Fargo informed Beilec that it was not their policy to
return a signed copy to the mortgagor. We note that exhibit No. 4 bears the signatures of
appellants but not of Wells Fargo.
       {¶ 16} Beilec testified that over the course of the next several months, Wells Fargo
requested hundreds of documents from appellants and that she complied with each
No. 13AP-330                                                                             6


request, even though many were redundant. In June, 2010, Wells Fargo sent appellants
written notice that the HAMP loan had not been approved. Although Beilec admitted that
appellants received the notice, Beilec continued to make the reduced monthly payments
through September 2010, when Wells Fargo notified her, over the telephone, that it would
not accept the lower payments. Thereafter, appellants made monthly payments of $1,370
through December 2010, when Wells Fargo demanded that appellants pay all past due
sums, including late payment fees and interest. Appellants disputed the amount
demanded by Wells Fargo and made no further payments. Wells Fargo commenced the
foreclosure action in January 2011.
       {¶ 17} The statute of frauds, as codified in R.C. 1335.05, states that no action shall
be brought upon a contract or sale of lands, tenements, or hereditaments, or interest in or
concerning them "unless the agreement upon which such action is brought, or some
memorandum or note thereof, is in writing and signed by the party to be charged
therewith or some other person thereunto by him or her lawfully authorized." Similarly,
R.C. 1335.02 states that "no party to a loan agreement may bring an action on a loan
agreement unless the agreement is in writing and signed by the party against whom the
action is brought."
       {¶ 18} There is no dispute that any agreement modifying the terms of the Note and
Mortgage in this case is legally enforceable only if the parties memorialize such an
agreement in writing. Contrary to appellants' assertion, exhibit No. 4 is not such an
agreement. Indeed, the title of the document strongly supports Wells Fargo's contention
that exhibit No. 4 memorializes only a temporary deviation from the payment terms of the
Note and Mortgage pending approval of a permanent modification of the Note and
Mortgage. Moreover, immediately beneath the title of the document is the parenthetical:
"(Step One of Two-Step Documentation Process)." The document also contains the
following recital: "I understand that after I sign and return two copies of this Plan to the
Lender, the Lender will send me a signed copy of this Plan if I qualify for the Offer or will
send me written notice that I do not qualify for the Offer. This Plan will not take effect
unless and until both I and the Lender sign it and the Lender provides me with a copy of
this Plan with the Lender’s signature." As noted above, exhibit No. 4 does not bear the
signature of Wells Fargo.
No. 13AP-330                                                                                      7


       {¶ 19} Similarly, the document clearly informs appellants that the trial period is
not a final and enforceable "Modification Agreement," and that upon approval by Wells
Fargo, the parties were to execute a "Modification Agreement."2 Bielec's testimony does
not alter the fact that exhibit No. 4 memorializes a temporary alteration of the monthly
payment pending final approval of a HAMP loan modification; nor does Bielec's
testimony necessarily conflict with that of Wells Fargo's Vice President of Loan
Documentation, Sarah Thayer, who testified that an actual modification of the Note and
Mortgage was not to occur until the second step in the loan modification process had been
completed. There is no question that the parties did not subsequently execute a written
HAMP Modification Agreement. In short, there is no merit in appellants' claims that the
original Note and Mortgage are now unenforceable due to the execution of a subsequent
written agreement.
       {¶ 20} We also find no merit in appellants' contention that Wells Fargo admitted
that the parties modified the Note and Mortgage by its responses to appellants' request for
admissions. Given the evidence as set forth above, it is clear that Wells Fargo admitted
only that it agreed to a temporary modification of appellants' monthly payments during
the HAMP trial period. Contrary to appellants' assertion, Wells Fargo's admissions were
not dispositive of the ultimate issue in this case.
       {¶ 21} For the foregoing reasons, appellants' first assignment of error is overruled.
       2. Promissory Estoppel
       {¶ 22} Appellants argue, in their second assignment of error, that even if the
parties did not execute a written loan modification agreement, Wells Fargo should be
estopped from enforcing the original Note and Mortgage given the compelling evidence
that appellants relied to their detriment on the promise of a modification. Again, we
disagree.
       {¶ 23} As a general rule, promissory estoppel arises where there is: (1) a clear and
unambiguous promise; (2) reliance upon the promise by the person to whom the promise
is made; (3) reliance is reasonable and foreseeable; and (4) the party seeking to enforce


2 Exhibit No. 4 states in relevant part: "I understand that the Plan is not a modification of the Loan
Documents"; and "If I comply with the requirements * * * the Lender will send me a Modification
Agreement."
No. 13AP-330                                                                            8


the agreement is injured as a result of its reliance. Garb-Ko, Inc. v. Benderson, 10th Dist.
No. 12AP-430, 2013-Ohio-1249. The promissory estoppel exception to the statute of
frauds, however, is permitted only where the promisor has either misrepresented that the
statute of fraud's requirements have been met or promised to make a memorandum of the
agreement. Huntington Natl. Bank v. Antrobius, 11th Dist. No. 2012-P-0036, 2012-Ohio-
5936, ¶ 33, citing Beaverpark Assoc. v. Larry Stein Realty Co., 2nd Dist. No. 14950, (Aug.
30, 1995); McCarthy, Lebit, Crystal & Haiman Co., L.P.A. v. First Union Mgt., Inc., 87
Ohio App.3d 613 (8th Dist.1993).
       {¶ 24} Appellants have not alleged that Wells Fargo misrepresented the writing
requirements applicable to the proposed loan modification agreement. Furthermore, to
the extent that appellants claim that Wells Fargo promised to execute a written HAMP
loan modification agreement at the end of the trial period, the evidence does not support
appellants' claim. In fact, the evidence shows: that the parties agreed to a temporary
modification of the monthly mortgage payments pending approval of a permanent
modification of the Note and Mortgage; that the temporary trial period expired by its own
terms; and that Wells Fargo never approved a permanent loan modification. Indeed, the
very exhibit upon which appellants rely, serves to defeat their contention that Wells Fargo
promised to execute a legally enforceable agreement that would permanently alter the
terms of the Note and Mortgage.
       {¶ 25} While we agree that the evidence supports appellants' contention that Wells
Fargo may have provided them with conflicting or misleading information about the
status of their HAMP loan, there is no dispute that, in June 2010, Wells Fargo sent
appellants written notice that the proposed loan modification was disapproved.
Nevertheless, appellants continued to make monthly payments at the lower rate for
several more months. Appellants also admit that, as the HAMP process unfolded, they
continued to receive correspondence from Wells Fargo evidencing a large and growing
overdue balance. Appellants further acknowledge that they were three or four months
behind in their mortgage payments at the time the HAMP loan was first discussed.
       {¶ 26} In short, the evidence does not support appellants' assertion that Wells
Fargo promised to execute an enforceable loan modification agreement, nor does it justify
No. 13AP-330                                                                            9


a finding that Wells Fargo should be estopped from pursuing this instant foreclosure
action under the original Note and Mortgage. Accordingly, the trial court did not abuse its
discretion in adopting the magistrate's decision. Appellants' second assignment of error is
overruled.
E. Conclusion
         {¶ 27} In the final analysis, we find that appellants failed to produce sufficient
evidence in support of any of their defenses to the foreclosure action. Accordingly, we
hold that the trial court did not abuse its discretion when it adopted the magistrate's
findings of fact and conclusions of law as its own, and entered judgment in favor of Wells
Fargo.
         {¶ 28} Having overruled each of appellants' assignments of error, we hereby affirm
the judgment of the Franklin County Court of Common Pleas.
                                                                      Judgment affirmed.


                            KLATT and T. BRYANT, JJ., concur.

               T. BRYANT, J., retired, of the Third Appellate District,
               assigned to active duty under authority of Ohio Constitution,
               Article IV, Section 6(C).
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