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PNC Mortgage v. Guenther

Court of Appeals of Ohio, Second District

July 12, 2013

PNC MORTGAGE, a division of PNC Bank National Association Plaintiff-Appellee
v.
CHERYL L. GUENTHER, et al. Defendant-Appellant

(Civil Appeal from (Common Pleas Court) Trial Court Case No. 2010-CV-5706

ANTHONY L. OSTERLUND, Atty. Reg. #0071086, and J.B. LIND, Atty. Reg. #0083310, Vorys, Sater, Seymour and Pease LLP Attorneys for Plaintiff-Appellee, PNC Mortgage.

WORRELL A. REID, Atty. Reg. #0059620, Attorney for Defendant-Appellants, Cheryl Guenther and Deanne Gerhardt

DOUGLAS TROUT, Atty. Reg. #0072027, Montgomery County Prosecutor's Office, Attorney for Montgomery County Treasurer

OPINION

HALL, J.

{¶ 1} In this foreclosure case, the mortgage company moved to enforce a settlement agreement that was negotiated by the parties' attorneys and reduced to writing but never signed. A magistrate held an evidentiary hearing and decided that the agreement should be enforced. A retired judge, sitting for the trial judge originally assigned to the case, reviewed the magistrate's decision and adopted it and the magistrate's findings of fact and conclusions of law.

{¶ 2} The property owners contend that the agreement is not enforceable because their attorney did not have the authority to enter the agreement and because they never signed a writing of it. But they failed to file a transcript of the magistrate's hearing. So we must simply accept the trial court's factual finding that the property owners' attorney had the necessary authority and the court's finding that the parties did not intend to make signing a condition precedent to enforcement. The property owners also contend that the trial court's order is voidable and void because it was not decided and signed by the judge originally assigned to the case. A certificate of assignment from the chief justice of the Ohio Supreme Court establishes the retired judge's authority to decide and sign the order.

{¶ 3} The trial court's order is affirmed.

I. The Facts

{¶ 4} In July 2010, PNC Mortgage filed a complaint in foreclosure against Cheryl L. Guenther and Deanne L. Gerhardt and others.[1] The parties tried to settle the case through informal mediation. In December 2011, though no notice of settlement had been filed with the trial court, PNC moved to enforce a settlement agreement that it claimed the parties had entered. Guenther and Gerhardt opposed, arguing that the settlement agreement is not enforceable. They contended that their attorney, Worrell Reid, did not have authority to enter into or approve the agreement and that the agreement was not final. Guenther and Gerhardt also contended that signing a writing of the settlement agreement is a condition precedent to its enforceability and they never signed anything. Both sides filed supporting affidavits.

{¶ 5} The matter was referred to a magistrate. The magistrate held an evidentiary hearing at which Reid and Gerhardt testified. Based on the affidavits and hearing testimony, the magistrate determined that Guenther and Gerhardt's attorney had authority to settle the case on the terms in the settlement agreement. The magistrate also concluded that, despite the fact that Guenther and Gerhardt did not sign the written agreement, an enforceable settlement agreement exists between the parties. With respect to the agreement, the magistrate made these findings: The Settlement Agreement contain[s] provisions under which (1) [PNC] would accept a reduced claim and would waive certain foreclosure related fees and costs; (2) [Guenther and Gerhardt] would acknowledge their debt and bring their mortgage current; and (3) that all claims and counterclaims would be dismissed with prejudice. The agreement was discussed in e-mails between counsel for the parties and final terms agreed upon between counsel. Mr. Reid represented that "I should have [the Agreement, as modified by their discussions] signed and mailed within 24 hours." Mr. Osterlund[, PNC's attorney, ] then forwarded the revised Settlement Agreement with the negotiated terms to Mr. Reid on November 9, 2011 for signature. The correspondence between counsel for the parties evidences a meeting of the minds. Mr. Reid offered that his clients would get the funds by November 15th and that the agreement "should" be signed and mailed back to Mr. Osterlund within 24 hours of receipt. The offer was accepted by [PNC], via Mr. Osterlund, on November 9, 2011, when he forwarded the revised Settlement Agreement to Mr. Reid. At this point in time both parties agreed upon the terms contained in the writing. Ms. Gerhardt acknowledged that, at this point in time, she was aware of the state of negotiations and she did plan to pay the arrearage of around $19, 000.00, along with a monthly payment of $1, 079.00. Accordingly, despite the fact that the document itself was not yet signed by the parties, there was a binding and enforceable settlement agreement between the parties on November 9, 2011. (Magistrate's Decision, 9-10). The magistrate believed that, "after entering into the agreement through counsel, [Guenther and Gerhardt] experienced financial difficulties (due to unexpected medical expenses) and had a change of heart regarding the agreement." (Id. at 10).

{¶ 6} Guenther and Gerhardt filed objections to the magistrate's decision with the judge originally assigned to the case, Judge Price. But in September 2012, it was Judge Wolff, a retired judge, who overruled their objections and adopted the magistrate's decision and findings of fact and conclusions of law, sustaining PNC's motion to enforce.

{¶ 7} Guenther and Gerhardt appealed.

II. The Enforceability of the Settlement ...


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