Court of Appeals of Ohio, First District, Hamilton
U.S. BANK NATIONAL ASSOCIATION as Trustee Successor in Interest to Bank of America, National Association as Trustee, successor by merger to LaSalle Bank National Association, as Trustee for Structured Asset Investment Loan Trust Mortgage Pass-Through Certificates, Series 2004-8, Plaintiff-Appellee,
WALTER G. BROADNAX, JR., Defendant-Appellant, and JANE DOE, name unknown, Spouse of WALTER G. BROADNAX, JR., UNITED STATES OF AMERICA, ATTORNEY GENERAL, U.S. DEPARTMENT OF JUSTICE, UNITED STATES OF AMERICA, U.S. ATTORNEY (Cinti), CHAMPION WINDOWS MANUFACTURING & SUPPLY CO., STATE OF OHIO, DEPARTMENT OF TAXATION, OHIO ATTORNEY GENERAL REVENUE RECOVERY, and STATE OF OHIO, BUREAU OF WORKERS' COMPENSATION, OHIO ATTORNEY GENERAL REVENUE RECOVERY SECTION, Defendants.
Appeal From: Hamilton County Court of Common Pleas Trial No.
Seamans Cherin & Mellott, LLC and Gwenn S. Karr, for
Robbins, Kelly, Patterson & Tucker, Michael A. Galasso
and Robert M. Ernst, for Defendant-Appellant.
Bergeron, Presiding Judge.
In this foreclosure action, the parties devote most of their
briefing attention on appeal to issues that were never
broached with the trial court below. Resisting the temptation
to wade into this thicket, we instead confine ourselves to
the arguments properly preserved in the record. We ultimately
find the defendant's statute of limitations argument
meritorious, as the bank waited for too long to commence this
suit after accelerating the loan (granted, there were some
twists and turns along the way, which we describe below). We
accordingly reverse summary judgment in favor of the bank and
remand with instructions to enter judgment for the defendant.
The roots of this case stretch back to April 2004, as it
involves a promissory note, executed by defendant-appellant
Walter Broadnax and secured by a mortgage on a residential
property located in Cincinnati. Nearly three years into his
payments (and on the cusp of the global financial crisis),
Mr. Broadnax defaulted on the note, failing to make his March
2007 payment. LaSalle Bank, the holder of the note at that
time (and predecessor in interest to plaintiff-appellee U.S.
Bank) dutifully sent him a notice of default, informing him
of the default and advising that, in the absence of curing
the default within 30 days, the bank had the right to
accelerate the full amount due under the note. The 30 days
came and went without any payment from Mr. Broadnax,
prompting LaSalle Bank to file, on June 13, 2007, the first
(of several) foreclosure complaints against Mr. Broadnax and
other parties with interests in the property. After two years
of litigation, LaSalle Bank and Mr. Broadnax agreed to a
stipulated dismissal signed by counsel, resulting in the
court dismissing the case without prejudice.
The record stands silent on what motivated the parties to
dismiss the first suit, but in any event, Mr. Broadnax
persisted in his failure to satisfy his payment obligations
under the note. As a result, roughly three years from
dismissal of the first action, in June 2012, LaSalle Bank
filed another foreclosure complaint against Mr. Broadnax
based upon the same default. This suit enjoyed a shorter
lifespan than the first, but ended in similar fashion with a
stipulated dismissal without prejudice in May 2013.
In November 2013, after a merger with LaSalle Bank, U.S. Bank
joined the festivities, filing a third complaint against Mr.
Broadnax-once again seeking to obtain judgment on the same
promissory note and to foreclose on the mortgage securing the
note. In response to this complaint, Mr. Broadnax raised
myriad affirmative defenses, chief among them that the
statute of limitations barred U.S. Bank from bringing its
claims. Following discovery, both parties moved for summary
judgment. In Mr. Broadnax's motion, he argued that
because the first complaint filed in June 2007 triggered
acceleration of the entire debt, the statute of limitations
ran six years later, in June 2013, thereby barring the
complaint filed in November 2013. To get around the statute
of limitations, U.S. Bank staked out the position that the
statute never ran because the third complaint filed in
November 2013 accelerated the loan, not the first complaint
filed in June 2007. Buttressing the point, U.S. Bank
explained (1) that the filing of a complaint alone is not
necessarily evidence of acceleration, and (2) that even if
the first complaint did somehow prompt acceleration of the
loan, then the first complaint's dismissal without
prejudice "deaccelerated" the loan.
Upon considering the competing arguments, the magistrate
granted summary judgment for U.S. Bank and accordingly denied
Mr. Broadnax's motion for summary judgment. Over Mr.
Broadnax's objections, the trial court adopted the
magistrate's decision granting summary judgment in favor
of the bank. Neither the trial court nor the magistrate
discussed the statute of limitations defense in the
Mr. Broadnax now appeals the trial court's judgment,
raising a single assignment of error challenging the
court's failure to apply the statute of limitations as a
bar to the suit. Complicating this appeal, U.S. Bank scuttles
its legal theories below (about deacceleration and the like)
and now concedes that the first complaint filed in June 2007
accelerated the debt. But to stave off reversal, U.S. Bank
fashions a new argument out of whole cloth, insisting that
the saving statute pursuant to R.C. 2305.19(A) nevertheless
shields its third complaint. In response to this newly-minted
argument, Mr. Broadnax features a new argument of his own in
his reply brief, asserting that the "double
dismissal" rule applies and bars U.S. Bank's present
claim for relief. Although the saving statute and the double
dismissal rule present interesting questions, as neither made
even a cameo below, we need only consider the issue before
the trial court-whether the first complaint filed on June 13,
2007 triggered acceleration of the entire debt, thereby
starting the statute of limitations clock, and rendering the
most recent complaint untimely.
Construing the facts in the light most favorable to Mr.
Broadnax, summary judgment is proper where no genuine
question of material fact exists and the moving party is
entitled to judgment as a matter of law. First Fin. Bank,
N.A. v. Mendenhall, 2017-Ohio-7628, 84 N.E.3d 1113,
¶ 6 (1st Dist.). We review a grant of summary judgment
de novo. Ligon v. Winton Woods Park, 1st Dist.
Hamilton No. C-180073, 2019-Ohio-1217, ¶ 6.
As noted above, the dispute below turned on whether the first
complaint filed in June 2007 accelerated the entire debt,
thus triggering the six-year statute of limitations period.
Notably, both parties agree that, because the promissory note
here is a "negotiable instrument" under Ohio law,
the statute of limitations provided within R.C. 1303.16(A)
governs. See R.C. 1303.03(A) ("
'[Negotiable instrument' means an unconditional
promise or order to pay a fixed amount of money * *
*."); Mohammad v. Awadallah, 8th Dist. Cuyahoga
No. 97590, 2012-Ohio-3455, ¶ 19 ("Because the Note
in this case was a negotiable instrument, it was governed by
a six-year statute of limitations under R.C.
1303.16(A)."). Pursuant to R.C. 1303.16(A), "an
action to enforce ...