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Nationstar Mortgage, LLC v. Abston

Court of Appeals of Ohio, Second District, Montgomery

July 26, 2019

DONALD C. ABSTON, et al. Defendant-Appellant

          Civil Appeal from Common Pleas Court Trial Court Case No. 2017-CV-4923




          HALL, J.

         {¶ 1} Defendant-appellant Donald Abston appeals the trial court's judgment overruling his Civ.R. 60(B) motion for relief from a default judgment of foreclosure entered for plaintiff-appellee Nationstar Mortgage LLC d/b/a Mr. Cooper. Finding no error, we affirm.

         I. Facts and Procedural History

         {¶ 2} On February 15, 2013, Abston executed a promissory note and he and his former wife executed a mortgage with PNC Mortgage, which later assigned the mortgage to Nationstar. In 2017, Abston fell behind in his payments. Nationstar sent him a letter, dated September 15, 2017, in which it offered him payment relief by modifying his loan. To obtain the modification, Abston had to participate in a Trial Period Plan (TPP). The TPP required him to make three consecutive payments by the last days of October, November, and December 2017. The letter also told Abston that to avoid foreclosure he must contact Nationstar to accept the offer or must make his first payment by September 29, 2017. The letter further said: "Once you have successfully made each of the three monthly Trial Period Plan payments by the due dates, we will send you the final modification agreement which is required to be signed and returned to us. We will also sign this modification agreement and your account will be permanently modified in accordance with the terms of the modification agreement." Abston did not contact Nationstar or make his first TPP payment by September 29.

         {¶ 3} On October 20, Nationstar filed a foreclosure action against Abston seeking judgment on the note and foreclosure of the mortgage. Abston was served with the summons and complaint seven days later. That same day, Abston contacted Nationstar and arranged to make his first TPP payment. Abston made his second payment on November 16. Nationstar moved to stay the foreclosure proceedings; on December 6, the motion was granted and the action was administratively dismissed, subject to reactivation. Abston made his third and final TPP payment on December 18.

         {¶ 4} On January 5, 2018, Nationstar mailed Abston the final modification agreement. Almost a month later, Abston called Nationstar and was told that he would need to return the agreement signed and notarized by both him and his wife. When Abston said that he and his wife had divorced, Nationstar told him that, in lieu of his wife's signature, he would need to send a copy of the divorce decree. Abston returned the modification agreement, along with a check for the new monthly payment. He did not send a copy of the divorce decree and had simply crossed out his former wife's signature line in the agreement. On February 13, 2018, Nationstar sent Abston a new copy of the modification agreement. Abston did not sign and return the new copy or submit a copy of the divorce decree, but on March 6, 2018, he made a payment in accordance with the modification agreement.

         {¶ 5} Nationstar sent Abston a letter dated April 6, 2018, telling him that he had not been approved for a loan modification. The letter advised Abston that he had 30 days to appeal the decision. Abston did not appeal. He did, though, send another payment. Nationstar returned the payment to him on April 26, 2018 with a letter telling Abston that it was insufficient to bring his account current. Abston called Nationstar on May 7, 2018, with a question about the amount of his May payment and was told that he had not been approved for the loan modification.

         {¶ 6} On May 9, 2018, Nationstar moved to reactivate the foreclosure proceedings and served the motion on Abston by regular mail. Two days later, the trial court granted the motion. On May 16, 2018, Nationstar moved for default judgment, serving the motion on Abston again by regular mail. Abston failed to file an answer or otherwise respond. On May 31, 2018 the trial court granted the motion and entered a final judgment of foreclosure.

         {¶ 7} While the record does not make the details clear, it appears that sometime after Abston's May 7, 2018 call to Nationstar, he did submit a copy of the divorce decree. Curiously, Nationstar sent Abston a letter, dated June 2, 2018, telling him that it had reviewed his documentation, that his response was complete, and that a 30-day evaluation period had begun. The letter further told Abston that Nationstar would not proceed with a foreclosure sale before evaluating his response. Two weeks later, Nationstar sent Abston another letter, dated June 14, 2018, telling him that he had not been approved for the loan modification. Like the April 6 letter, this letter advised Abston that he had 30 days to appeal the decision. Abston did not appeal.

         {¶ 8} On July 10, 2018, Abston moved to stay the foreclosure proceedings so that he could file a motion for relief from judgment, and on July 13, 2018, he filed a motion for relief from judgment under Civ.R. 60(B). The trial court granted the motion to stay, but on December 17, 2018, the court overruled the motion for relief from judgment.

         {¶ 9} Abston appeals.

         II. Analysis

         {¶ 10} Abston presents five assignments of error for our review. The first four challenge the substance of the trial court's judgment and the last challenges the lack of a hearing on the relief motion.[1]

         {¶ 11} "The standard of review of a trial court's decision on a Civ. R. 60(B) motion is the abuse of discretion standard." (Citation omitted.) Discover Bank v. Wells, 2d Dist. Clark No. 2018-CA-44, 2018-Ohio-4637, ¶ 26. "Abuse of discretion" has been defined as an attitude that is unreasonable, arbitrary, or unconscionable. Huffman v. Hair Surgeon, Inc., 19 Ohio St.3d 83, 482 N.E.2d 1248 (1985). "A decision is unreasonable if there is no sound reasoning process that would support that decision." AAAA Ents., Inc. v. River Place Community Urban Redevelopment Corp., 50 Ohio St.3d 157, 161, 553 N.E.2d 597 (1990).

         {¶ 12} A trial court may set aside a default judgment under Civ.R. 60(B) if the movant demonstrates that: "(1) the party has a meritorious defense or claim to present if relief is granted; (2) the party is entitled to relief under one of the grounds stated in Civ.R. 60(B)(1) through (5); and (3) the motion is made within a reasonable time, and, where the grounds of relief are Civ.R. 60(B)(1), (2) or (3), not more than one year after the judgment, order or proceeding was entered or taken." GTE Automatic Elec., Inc. v. ARC Industries, Inc., 47 Ohio St.2d 146, 351 N.E.2d 113 (1976), paragraph two of the syllabus. The grounds for relief enumerated in the rule include "mistake, inadvertence, surprise or excusable neglect," Civ.R. 60(B)(1), and "fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation or other misconduct of an adverse party," Civ.R. 60(B)(3).

         {¶ 13} Abston argued in his Civ.R. 60(B) motion that he was not in default of the note and that he had a claim for promissory estoppel. He argued for relief on the grounds of excusable neglect and fraud. The trial court rejected these arguments. In the first and second assignments of error, Abston challenges the rejection of the lack-of-default defense and promissory-estoppel claim, and in the third and fourth assignments of error he challenges the rejection of the two grounds for relief.

         A. Meritorious defense or claim

         {¶ 14} "In order to establish a meritorious claim or defense under Civ.R. 60(B), the movant is required to allege a meritorious claim or defense, not to prove that she will prevail on that claim or defense." (Citation omitted.) GMAC Mtge., LLC. v. Herring, 189 Ohio App.3d 200, 2010-Ohio-3650, 937 N.E.2d 1077, ¶ 32 (2d Dist.). "A 'meritorious defense' means a defense 'going to the merits, substance, or essentials of the case.' * * * Relief from a final judgment should not be granted unless the party seeking such relief makes at least a prima facie showing that the ends of justice will be better served by setting the judgment aside." Wayne Mut. Ins. Co. v. Marlow, 2d Dist. Montgomery No. 16882, 1998 WL 288912, *2-3 (Jun. 5, 1998), quoting Black's Law Dictionary, 290 (6th Ed.Rev.1991); see also Herring at ¶ 32 (quoting the same). "Broad, conclusory statements do not satisfy the requirement that a Civ.R. 60(B) motion must be supported by operative facts that would warrant relief from judgment." Herring at ¶ 32, citing Cunningham v. Ohio Dept. of Transp., 10th Dist. Franklin No. 08AP-330, 2008-Ohio-6911, ¶ 37, and Bennitt v. Bennitt, 8th Dist. Cuyahoga Nos. 65094 and 66055, 1994 WL 236295 (May 26, 1994). "A party seeking relief from judgment is not required to prove that he or she will prevail on the meritorious defense; the movant is merely required to allege the existence of such a defense." (Citation omitted.) UBS Real Estate Securities, Inc. v. Teague, 191 Ohio App.3d 189, 2010-Ohio-5634, 945 N.E.2d 573, ¶ 23 (2d Dist.).

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