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MTGLQ Investors L.P. v. Faulkner

Court of Appeals of Ohio, Twelfth District, Warren

July 23, 2018

MTGLQ INVESTORS L.P., Plaintiff-Appellee,


          Reimer Law Co., Michael L. Wiery, P.O. Box 96696, 30455 Solon Road, Solon, Ohio 44139, for plaintiff-appellee

          Joseph R. Matejkovic, 9078 Union Centre Blvd., Suite 350, West Chester, Ohio 45069, for defendant-appellant, Jeff A. Faulkner, Trustee

          David P. Fornshell, Warren County Prosecuting Attorney, Christopher A. Watkins, 520 Justice Drive, Lebanon, Ohio 45036, for defendant, Warren County Treasurer


          HENDRICKSON, J.

         {¶ 1} Defendant-appellant, Jeff A. Faulkner, Trustee of the Jeff A. Faulkner Family Trust Dated March 22, 1995, appeals from a decision of the Warren County Court of Common Pleas granting summary judgment in favor of substitute plaintiff-appellee, MTGLQ Investors L.P. (hereafter, "MTGLQ"), in a foreclosure action. For the reasons set forth below, we affirm the trial court's decision.

         {¶ 2} On February 24, 2006, appellant executed a promissory note in favor of America's Wholesale Lender ("America's Wholesale") in the amount of $68, 000 for the purchase of real property located at 729 South Main Street in Franklin, Ohio. The promissory note called for monthly payments for a period of 30 years, with interest accumulating on the principal amount at a yearly rate of 7 percent. The promissory note was secured by a mortgage that designated appellant as the borrower, America's Wholesale as the lender, and Mortgage Electronic Registration Systems, Inc. ("MERS") as the mortgagee, acting as the nominee for America's Wholesale. The mortgage was recorded on March 17, 2006.

         {¶ 3} The promissory note was endorsed in blank by America's Wholesale. On August 16, 2010, MERS executed an Assignment of Real Estate Mortgage, assigning all interest under the mortgage to BAC Home Loans Servicing, L.P. f.k.a. Countrywide Home Loans Servicing, L.P. Thereafter, on June 18, 2013, Bank of America, N.A., successor by merger to BAC Home Loans Servicing, L.P., assigned its interest in the mortgage to Green Tree Servicing, LLC. On August 31, 2015, Green Tree Servicing, LLC merged with two other companies, and the mortgage was subsequently held by Ditech Financial LLC ("Ditech"), the successor by merger to Green Tree Servicing, LLC.

         {¶ 4} At some point in 2011, the terms of the promissory note were renegotiated, a fact that was conceded by both appellee and appellant in their respective appellate briefs.[1] On March 30, 2016, Ditech filed a complaint in foreclosure alleging that appellant defaulted in payment on the promissory note in July 2011, that it had declared the debt due, it had complied with all conditions precedent as set forth in the note and mortgage, and that the sum of $44, 925.90 plus interest at the rate of 5.25 percent per annum was owed. Ditech attached to its complaint the endorsed-in-blank promissory note, the mortgage, and the various assignments of the mortgage.

         {¶ 5} Appellant filed an answer in which he admitted there was a mortgage on the property securing the note. However, appellant denied the amount of the outstanding balance claimed by appellant and further denied he was in default. Appellant then set forth the following affirmative defenses, asserting that (1) he was not "properly name[d]" in the action, (2) the action was not brought by a real-party-in-interest, (3) the complaint failed to state a claim upon which relief could be granted, (4) the complaint did not meet the statutory requirements for relief under the law, (5) the complaint was barred by the applicable statutes of limitations and the doctrine of laches, (6), the complaint was barred by the doctrine of waiver and the doctrine of accord and satisfaction, (7) the complaint was barred due to a lack of consideration, and (8) the plaintiff failed to mitigate its damages.

         {¶ 6} After the initiation of discovery, Ditech moved to substitute the plaintiff in the action, as the note and mortgage was assigned to appellee, MTGLQ, on September 22, 2016. No party opposed the motion and the motion was granted on May 1, 2017. Thereafter, on May 22, 2017, MTGLQ moved for summary judgment. In support of its motion, MTGLQ attached the affidavit of Teresa H. Hubner, an employee of New Penn Financial, LLC d.b.a. Shellpoint Mortgage Servicing (hereafter, "Shellpoint Mortgage Servicing"), the mortgage servicer for MTGLQ. Hubner attested that she was familiar with the business records maintained by Shellpoint Mortgage Servicing, she had reviewed the business records related to appellant's loan, appellant had defaulted on the terms of the note and mortgage by failing to pay the July 1, 2011 payment, the default had not been cured, the debt had been accelerated in accordance with the terms of the note, and the entire balance of $44, 925.90, plus interest at 5.25 percent from June 1, 2011, was due and owed. Attached to Hubner's affidavit were copies of the promissory note, mortgage, and assignments of the mortgage, including the September 22, 2016 assignment of the mortgage from Ditech to MTGLQ.

         {¶ 7} Appellant did not file a response in opposition to MTGLQ's motion. On June 20, 2017, the trial court granted MTGLQ's motion for summary judgment.

         {¶ 8} Appellant timely appealed, raising the following as his sole assignment of error:


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