Court of Appeals of Ohio, Second District, Montgomery
DEVIN A. FARMER Plaintiff-Appellee
PNC BANK, N.A., et al. Defendants-Appellees and JOSEPH KISTNER Defendant-Appellant
Appeal from Common Pleas Court Trial Court Case No.
M. ENGEL, Attorneys for
TOBY SCHISLER, Attorney for Defendant/Cross-Claimant/Appellee
- PNC Bank, N.A.
1} Defendant/Cross-Claimant/Appellant, Joseph
Kistner, appeals from a trial court judgment granting a
motion for sanctions and judgment filed by
Defendant/Cross-Claimant/Appellee, PNC Bank, N.A.
("PNC"). Kistner contends that the trial court
erred in granting judgment against him, in assessing damages
against him, and in dismissing his cross-claims against PNC.
2} We conclude that the trial court erred in failing
to provide Kistner with a reasonable opportunity to be heard
regarding the motion for sanctions, which resulted in a
default judgment against Kistner, an award of damages against
Kistner, and dismissal of Kistner's cross-claims against
PNC. As a result, the judgment of the trial court will be
reversed, and this cause will be remanded for further
Facts and Course of Proceedings
3} In April 2015, Devin Farmer filed a complaint
against Joseph Kistner, PNC, Samuel Whitaker, and Martha
Kline. The complaint was based on Famer's purchase of a
property located on Olson Drive in Kettering, Ohio. Kistner
had previously owned the property and had granted a mortgage
in 2005 to National City Bank, a division of National City
Mortgage of Indiana. The complaint alleged that PNC was the
successor by assignment to National City Mortgage and a
4} According to the complaint, National City had
assigned the mortgage to Mortgage Electronic Registration
System ("MERS") in 2006, and MERS had then assigned
Kistner's mortgage to Watermark Financial Partners
("Watermark") in August 2011. In late September
2011, PNC filed a foreclosure action against Kistner in
Montgomery County Common Pleas Court (Case No.
2011-CV-07060), but the case was dismissed for lack of
standing in August 2012. Shortly after the dismissal, Samuel
Whitaker signed a release of the mortgage, as nominee for
Watermark, and the release was filed in Montgomery County,
Ohio, property records on August 15, 2012.
5} The complaint further alleged that Watermark was
not doing business in August 2012, that Whitaker was not
affiliated with Watermark, and that Kistner had fraudulently
obtained the release. Kline was the individual who had
notarized Whitaker's signature on the release.
6} According to the complaint, Kistner then executed
and delivered a general warranty deed to Farmer for the Olson
Drive property on December 31, 2012. Kistner received more
than $70, 000 for the sale of the property, but did not remit
any money to PNC or anyone else, to satisfy the mortgage.
Farmer's general warranty deed for the property was filed
on January 1, 2013.
7} In the complaint, Farmer asked for a declaration
of her rights in the property and a determination of her
rights as a bona fide purchaser. She also asked for damages
from Kistner for breach of the warranty covenants, and for
damages from Kistner, Whitaker, and Kline for fraudulent
conduct in connection with the release.
8} In May 2015, PNC filed an answer in which it
stated that it was a successor by assignment from National
City Mortgage. PNC denied that it had authorized any release,
and denied that Farmer's alleged status as a bona fide
purchaser should have an effect on its mortgage. In addition,
PNC filed cross-claims for contribution and indemnity against
Kistner, Whitaker, and Kline, to the extent that any
liability were found against PNC, or if any determination of
rights negatively affected PNC's mortgage.
9} Kistner filed a pro se answer to the complaint,
as well as a cross-claim against PNC. The cross-claim alleged
fraud and concealment in connection with the 2011 foreclosure
action PNC had filed; fraud, unclean hands, and concealment
regarding the various assignments of the mortgage since 2005;
violation of public policy by MERS (which was not a party);
and estoppel and laches with respect to assignments of the
mortgage, including a "Corrective Assignment"
executed by a nominee for PNC and filed in the Montgomery
County, Ohio, property records on February 15, 2013. PNC
filed an answer to the cross-claim in June 2015, and asserted
various affirmative defenses.
10} Between June and September 2015, Kistner, Kline,
and Whitaker engaged in various actions that hindered
discovery. In early June 2015, the trial court set a
telephone scheduling conference for June 24, 2015. After
Kistner's co-defendant, Kline, moved for summary judgment
based on the fact that she had never met Kistner and had
simply notarized Whitaker's signature, Kistner filed a
motion to continue the scheduling conference until the trial
court ruled on the summary judgment motion, even though the
motion had nothing to do with the claims against him.
11} Both Farmer and PNC then filed motions under
Civ.R. 56(F), asserting that discovery was needed before they
could reply to the pending motions.  On July 10, 2015, the trial
court granted the Civ.R. 56(F) motions, stressing that
discovery was needed, and that an "uncorroborated,
self-serving affidavit" was "deemed insufficient to
establish the absence of any genuine issue of
material fact where the opposing parties have not yet been
afforded an opportunity to explore the underlying facts
through discovery." (Emphasis sic.) Docket Summary, Case
No. 26911, Doc. #47, p. 6. On the same day, the court also denied
Whitaker's motion for an extension of time to respond to
discovery until after the court had ruled on all pending
motions. The court again stressed that the defendants were
required to submit to discovery before Farmer and PNC had to
respond to summary judgment motions. In addition, this entry
mentioned potential sanctions for failure to provide
discovery. Id. at Doc. #46, p. 7.
12} In the meantime, Farmer had filed notices to
take depositions of Kistner, Kline, and Whitaker. The notices
were filed on June 24, 2015, and the depositions were set for
July 22, 2015. Thus, Kistner had nearly a month's notice
of his deposition.
13} On July 13, 2015, Kistner filed a motion for
partial summary judgment based only on general assertions
that he did not do anything wrong and lacked fraudulent
intent. The following day, Farmer filed a Civ.R. 56(F)
motion, which was granted by the court on July 30, 2015.
Kistner also had filed a motion for a protective order on
July 17, 2015, asking the court to stay discovery until it
had ruled on all pending motions. Farmer responded on July
20, 2017, noting that counsel had received a letter from
Kistner on July 17, 2015, which asked that the July 22
deposition be moved from Columbus to Dayton. Notably, Kistner
did not object to having his deposition taken. Counsel then
accommodated Kistner by moving the deposition to Dayton. In
addition, Farmer noted that the court had previously rejected
the position that Kistner was taking about discovery being
delayed until after the court had ruled on pending motions.
14} On July 22, 2015, Farmer filed a supplemental
response, informing the court that Kistner had agreed to be
deposed on August 6, 2015, in Dayton. Farmer again asked the
court to deny Kistner's motion for a protective order.
The court denied Kistner's motion for a protective order
on July 27, 2015, and stressed again that discovery must
proceed. As was noted, on July 30, 2015, the court granted
Farmer's Civ.R. 56(F) motion for an extension of time to
reply to Kistner's motion for summary judgment. In this
decision, the court emphasized that any delays in discovery
were attributable to the defendants other than PNC, and
reiterated its prior remark about uncorroborated,
self-serving affidavits. Docket Summary, Case No. 26911, Doc.
#67, p. 6.
15} Farmer then filed a motion to compel discovery
from Kistner on August 13, 2015. In the motion, Farmer stated
that Kistner had appeared on August 6 for his deposition, but
after being questioned for two hours, Kistner asked for
counsel and stopped responding to questions. The deposition
was adjourned and was to be reconvened after Kistner obtained
counsel. However, despite efforts by Farmer to resolve the
issue, Kistner had not provided Farmer with information about
counsel. On August 21, 2015, Farmer filed a supplement to the
motion to compel, noting that Kistner had not retained
counsel. In fact, Kistner had sent a fax indicating that he
had decided to continue with discovery and would likely
retain counsel for trial.
16} Farmer stressed that this "change of
heart" did not justify Kistner's refusal to answer
questions at his deposition. In addition, Farmer commented
that the parties would incur additional time and travel
expenses when the deposition was reconvened. As a result,
Farmer asked for fees and costs, and also asked the court to
grant the motion to compel to prevent this type of delay from
17} On August 25, 2015, Farmer filed a third notice
of deposition, requiring Kistner to appear for a deposition
on September 3, 2015, in Dayton, Ohio. Kistner then filed a
notice that he would not be available on that date, and asked
for another protective order. In a response filed on
September 1, 2015, counsel for Farmer indicated that Kistner
had not called to request a different date, and was,
therefore, not entitled to relief under Civ.R. 26(C).
Nonetheless, counsel stated that the deposition would be
rescheduled because Kistner would not likely appear.
18} On September 1, 2015, the trial court referred
the matter to a magistrate for purposes of discovery. The
court also granted Farmer's motion to compel discovery
and denied Kistner's motion for protective order. At this
point, the court ordered Kistner to appear for deposition at
a time to be determined by the magistrate at a scheduling
conference to be held on September 10, 2015. In its decision,
the court stated that given the contentious history
surrounding Kistner's deposition, the deposition should
go forward under the court's strict supervision. The
court further stated that the magistrate would oversee the
remainder of the continued deposition. Kistner was also
ordered to pay Farmer reasonable costs, including attorney
fees, for obtaining the order.
19} Finally, the court stated that:
Defendant Kistner is further cautioned that failure to timely
and completely comply with all terms of this Order
WILL result in the imposition of additional
sanctions in accordance with Civ.R. 37(B), which may include
but are not limited to the issuance of an Order holding that
the facts alleged in Plaintiffs complaint as against
Defendant Kistner shall be taken as established for the
purposes of this action, refusing to allow Defendant Kistner
to oppose Plaintiffs claims or to support his own defenses to
those claims, prohibiting Defendant Kistner from introducing
certain evidence, striking out Defendant Kistner's answer
or parts thereof, and/or rendering a judgment by default
against Defendant Kistner, as well as being held in contempt
of this Court and required to pay Plaintiffs additional
reasonable expenses, including attorney fees.
(Emphasis sic.) Docket Summary, Case No. 26911, Doc. #80, pp.
20} Subsequently, on September 18, 2015, Kistner
filed a motion to continue the deposition scheduled for
September 21, 2015 before the magistrate, because he had not
been able to obtain counsel. Farmer then filed a motion for
sanctions on September 24, 2015. In the motion, Farmer
indicated that Kistner's motion was filed very late in
the day on the Friday before the Monday that the deposition
was scheduled. The motion alleged that all parties, including
Kistner, appeared on Monday, September 21, 2015, before the
magistrate, who heard the motion for
continuance. According to Farmer, Kistner repeatedly
told the magistrate that he was unsure how to proceed, and
the magistrate advised Kistner that he could answer questions
or risk sanctions for failing to do so. Kistner refused to
answer when the magistrate asked if he were refusing to
proceed. After about 30 minutes, the magistrate stated that
he would consider Kistner's position as a refusal to
answer deposition questions, and asked for oral motions. At
that point, Farmer and PNC orally moved for judgment and for
an order dismissing all claims or defenses that Kistner had
interposed. The hearing was then adjourned. Again, the
recounting of these matters is based on allegations only,
since the transcript is not in the record.
21} PNC filed a response to Farmer's motion for
sanctions, agreeing with the motion, but clarifying that to
the extent any relief was ordered that would impair PNC's
status as the first and best lienholder, that issue would
have to be resolved. On October 5, 2015, PNC also filed its
own motion for sanctions and judgment against Kistner, and
incorporated the statement of facts in Farmer's motion.
PNC further stated that during the deposition on August 6,
2015, Kistner admitted that he had no permission from PNC, or
anyone related to the mortgage, to record the purported
release of the mortgage. In addition, Kistner admitted that
he still owed money on the mortgage and that he did not pay
PNC any of the sale proceeds that he had received.
22} On October 5, 2015, the trial court granted
Farmer's motion for sanctions, struck Kistner's pro
se answer and cross-claim, and entered judgment in favor of
Farmer against Kistner. The court directed Farmer to file a
proposed final judgment entry, which was filed and signed by
the court on October 13, 2015. The court also granted
PNC's motion for sanctions on October 8, 2015. At that
time, the court entered judgment in PNC's favor on its
cross-claim against Kistner and on the cross-claim that
Kistner had filed against PNC. The court directed PNC to file
a proposed judgment entry, which was filed and signed by the
court, apparently on the same day, on October 15, 2015.
23} On October 15, 2015, Farmer dismissed her claims
against Whitaker under Civ.R. 41(A), without
prejudice. Kistner then filed a notice of appeal from
the October 13 and 15, 2015 judgments on November 13, 2015.
This appeal was docketed as Case No. 26911 in our court. As
noted previously, we dismissed the appeal in its entirety on
March 31, 2016. Farmer I, 2d Dist. Montgomery No.
26911 (Mar. 31, 2016).
24} We concluded that the notice of appeal was
untimely with respect to the October 13, 2015 judgment, which
contained a Civ.R. 54(B) certification and was a final
appealable order on that date. Id. at pp. 8-9.
However, we also concluded that the judgment of October 15
was not a final appealable order because it lacked a Civ.R.
54(B) certification, and ...