U.S. BANK NA Appellants/Cross Appellees
DENNIS M. SCHUBERT, et al. Appellees/Cross-Appellants
FROM JUDGMENT ENTERED IN THE COURT OF COMMON PLEAS COUNTY OF
LORAIN, OHIO CASE No. 10 CV 170414
BENJAMIN D. CARNAHAN, Attorney at Law, for
MALICKI and THOMAS R. THEADO, Attorney at Law, for
DECISION AND JOURNAL ENTRY
JENNIFER HENSAL JUDGE.
U.S. Bank, N.A. and Ocwen Loan Servicing, LLC have appealed a
judgment of the Lorain County Court of Common Pleas that
foreclosed on the property of Dennis and Sue Schubert. The
Schuberts have cross-appealed the trial court's judgment.
For the following reasons, this Court affirms.
In 2000, the Schuberts obtained a loan from Bank One that
they secured with a mortgage of property they owned in
Elyria. Shortly after obtaining the loan, Mr. Schubert lost
his job, which led to the Schuberts declaring bankruptcy
twice. During this period, the Schuberts fell behind in their
loan payments. In 2004, Ocwen began servicing the loan, and
the mortgage was transferred to U.S. Bank, as trustee for the
registered holders of GSRPM 2004-1 mortgage pass-through
In 2006, the Schuberts discovered there was something wrong
with the accounting of the loan. Ocwen also sent the
Schuberts a notice of default. Following additional
communications, the Schuberts and Ocwen entered into a
forbearance agreement. Despite the agreement, the trustee at
the time filed a foreclosure action against the Schuberts.
The court later dismissed the action in light of the
Following the dismissal of the foreclosure action, the
Schuberts sought to modify the terms of the note. In 2008,
Ocwen entered into a loan modification agreement with the
Schuberts, which reduced their monthly loan payments but
added a balloon payment to the end of the loan's term.
The Schuberts paid the new amount until June 2010, when they
stopped making further payments. In December 2010, U.S. Bank
filed a foreclosure action against the Schuberts. The
Schuberts counterclaimed, alleging claims against U.S. Bank
and Ocwen for breach of contract, violations of the Fair Debt
Collection Practices Act (FDCPA), intentional infliction of
emotional distress, negligence, gross negligence, violations
of the Real Estate Settlement Procedures Act, mortgage
services abuses, and breach of the covenant of good faith and
fair dealing. Following a trial to the bench, the court found
that the Schuberts defaulted on the note as modified and that
U.S. Bank, as trustee, was entitled to foreclose on the
mortgage. It denied the Schuberts' counterclaims. U.S.
Bank has appealed the trial court's conclusion that the
Schuberts' breach of contract claim was not subject to a
three-year statute of limitations period under the Uniform
Commercial Code (UCC). The Schuberts have cross-appealed,
assigning five errors. For ease of consideration, we will
address the cross-appeal first.
ASSIGNMENT OF ERROR I
TRIAL COURT ERRED IN CONCLUDING AS A MATTER OF LAW THAT THE
CALCULATIONS FOR THE AMOUNT DUE UNDER THE NOTE COMMENCED WITH
THE EXECUTION OF THE LOAN MODIFICATION AGREEMENT.
The Schuberts argue that the trial court erred when it
calculated how much they owed on the note. They argue that
U.S. Bank had the burden to show the amount due, which it
could not in light of the history of accounting issues with
the loan. They also argue that the court incorrectly looked
at only the credits and debits that were made following the
loan modification instead of over the life of the loan.
According to the Schuberts, because of the accounting errors,
the trial court's calculation is off by approximately $8,
The trial court found that the Schuberts acknowledged being
in default of the loan, as modified by the modification
agreement, since June 2010. It found that the Schuberts did
not present any evidence that rebutted the amount U.S. Bank
argued was due on the modified loan and, therefore, found
that the amount due was $202, 845.90.
The Schuberts' argument about the trial court's
"amount due" finding appears to be a challenge to
the weight of the evidence. When reviewing the manifest
weight of the evidence in a civil case, this Court
weighs the evidence and all reasonable inferences, considers
the credibility of witnesses and determines whether in
resolving conflicts in the evidence, the [finder of fact]
clearly lost its way and created such a manifest miscarriage
of justice ...