Court of Appeals of Ohio, Eighth District, Cuyahoga
Appeal from the Cuyahoga County Court of Common Pleas Case
Deas Kochalski, L.L.C., and Matthew J. Richardson, for
Office of Paul B. Bellamy, JD, PhD, and Paul B. Bellamy, for
JOURNAL ENTRY AND OPINION
RAYMOND C. HEADEN, J.
1} Defendants-appellants Gerald and Yohnta Spencer
("the Spencers") appeal from the trial court's
order adopting the magistrate's decision granting
judgment in favor of plaintiff-appellee MidFirst Bank
("MidFirst") and entering a decree of foreclosure.
For the reasons that follow, we affirm.
and Substantive History
2} This is a foreclosure case stemming from the
Spencers defaulting on their mortgage related to the
residential property located at 5216 Milo Avenue in Maple
Heights, Ohio ("the property"). On October 26,
2015, MidFirst filed a complaint for foreclosure against the
Spencers, alleging that it was entitled to foreclose its
mortgagee interest in the property as a result of the
Spencers' default on their note and mortgage. MidFirst
attached copies of the note, mortgage, and assignments to its
complaint. MidFirst also sought to reform the legal
description of the property in the mortgage to correct a
3} On March 13, 2001, the Spencers executed a
promissory note and mortgage in the amount of $112, 610. They
defaulted on the note and mortgage in August 2013. The note
provided that Union National Mortgage Co. ("Union")
was the Lender, and the mortgage stated that Mortgage
Electronic Registration Systems, Inc. ("MERS") was
acting solely as nominee of Union and Union's successors
and assigns, and MERS was the mortgagee under that security
instrument. On October 31, 2011, Union executed an assignment
of the mortgage in favor of Citimortgage, Inc.
("Citimortgage"), and on February 2, 2012,
Citimortgage further assigned the mortgage to MidFirst. The
copy of the note initially attached to the complaint
contained a stamped and undated indorsement in blank from
Union signed by Union's assistant vice president.
4} On September 25, 2015, the Spencers filed a pro
se answer to MidFirst's complaint. The parties engaged in
mediation discussions, but the discussions were unsuccessful,
and the Spencers subsequently retained counsel. On December
24, 2015, the Spencers filed an amended answer with
counterclaims. The magistrate held a hearing in which counsel
for MidFirst presented the Spencers and the court with the
original note, which contained additional indorsements
terminating in a specific indorsement to MidFirst.
5} On January 29, 2016, with leave of court,
MidFirst filed an amended complaint and attached a copy of
the note in what MidFirst described as its current state. The
note contained an indorsement from Union to Principal
Residential Mortgage, Inc. ("Principal"), dated
March 13, 2001. The note also contained an indorsement from
Principal to MidFirst, executed by Paul Bognanno
("Bognanno"), Principal's president and chief
6} On February 12, 2016, the Spencers filed an
amended answer with counterclaims, alleging that MidFirst had
violated the Fair Debt Collections Practices Act
("FDCPA"), had committed fraud, and had committed
invasion of privacy by intrusion upon seclusion. On April 11,
2016, MidFirst filed a motion to dismiss the Spencers'
counterclaims pursuant to Civ.R. 12(B)(6). The Spencers filed
a brief in opposition to MidFirst's motion to dismiss.
7} On May 20, 2016, the trial court granted
MidFirst's motion to dismiss in part and denied the
motion in part. The trial court granted the motion with
respect to the Spencers' counterclaim for fraud. The
court explained its ruling as follows:
Since statements made in the complaint are intended to cause
the court to act upon them, not defendants, any
misrepresentations in the complaint cannot form the basis of
a fraud claim, even if the defendants allege that they acted
upon the statements. Castellanos v. Deutsche Bank,
(July 6, 2012) U.S. Dist. Ct. S.D. Ohio No. 1:11-CV-815, 2012
U.S. Dist. LEXIS 93455. Accordingly, defendant's
counterclaim for fraud fails to state a claim and is
Since defendants allege that plaintiff is not collecting its
own debt and, therefore is a debt collector, allege that the
loan is a residential transaction, allege that they are
consumers, and allege that, by submitting false documents
with the complaint, committed an act in violation of the
FDCPA, defendants state a claim for violation of the FDCPA.
Wallace v. Wash. Mut. Bank, FA, (6th Cir. 2012), 683
F.3d 323, 327. Therefore, plaintiffs motion to dismiss is
denied as to this claim.
A claim for invasion of privacy by intrusion of seclusion
requires activities that cause outrage, mental suffering,
shame or humiliation to a person of ordinary sensibilities.
Housh v. Peth, (1956), 165 Ohio St. 35. If, as
defendants allege, plaintiff caused the default on the loan
by willfully failing to accept payments after a modification,
plaintiff may have committed such an act. Accordingly,
defendants state a claim for ...