IN THE SUPREME COURT OF OHIO

* 13 - 0 83 6Joseph A Meister,

Appellant/Defendant

vs.

BAC HOME LOANS SERVICING,LP

Appellee/Plaintiff

* On Appeal from the Lake

* County Court of Appeals

* 11'' Appellate District

^ Court of Appeals Case No.

2012-Lr042

MEMORANDUM IN SUPPORT OF JURISDICTION OF APPELLANT

Patricia Block

Jeffrey HelmsLemer Sampson and Rothfuss

PO Box 5480

Cincinnati, OH 45201-5480

513-241-3000

513-241-4094 (fax)

gtyemail@lsrlaw.com

Attorneys for BAC HOME LOANS

SER-V-ICING, LP

Joseph A Meister9007 Woodridge LaneMentor, OH 44060440-382-9910 phone440-299-6575 faxJMeister9007 @,gmail. comPro Se

RLEDMAY 2 4 7013

CLERK OF COURTS^^^^ME COHHT OF OH^O

M02 4 2013

CLERK OF COURTUPREME UOUF17 OF OHIO

TABLE OF CONTENTS

Page

I. Explanation of why this case involves a substantial constitutional issue

and is of great general interest 6

II. Statement of the Case and of Facts

III. Arguments in Support of Propositions of Law

Proposition of Law No. 1: A Naked Assignment of Mortgage

alone will not establish the standing of the Plaintiff in a foreclosure

action.

7

10

10

Proposition of Law No. 2: An Assignment of Mortgage alone is

insufficient to establish that a foreclosure plaintiff is entitled to

enforce the Note. 10

Proposition of Law No. 3: In order to have standing to prosecute a

mortgage foreclosure claim, the foreclosing party must be entitled to

enforce the note when the complaint is filed. 11

Proposition of Law No. 4: A borrower has standing to challenge

an assignment of mortgage under limited circumstances. 12

Proposition of Law No. 4: Evidence which is created by counsel

without disclosure of the inherent conflict of interest falls under the

provisions of Civ.R. 60B(5).

IV. Conclusion

13

14

V. Proof of Service 15

Appendix: 11"' Dist. Appellate Court Denial of Appellant's Motion for Reconsideration

TABLE OF AUTHORITIES

CASES:Fed Home Loan Mtge Corp. v Schwartzwald, 135 Ohio St.3d 13, 2012-Ohio-5017 . ...... ......... ...6,12

Pratts vHurley, 102 Ohio St.3d 81, 2004-Ohio-1980 ..................................... ..............7,9

BAC Home Loans Servicing v Meister, 2013-Ohio-873 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............ 7 , 10

United States ofAmerica v Bank ofAmerica, (2012), D.C. Cir. No. 1:12-cv-00361 . . .. . .. . .. . .. . .. . .. . ..8

Carpenter v. Longan, 83 U.S. 271, 21 L.Ed.313 (1872) ......................................... ...........1010

Kernohan v. Manns, 53 Ohio St. 118,41 N.E. 258 (1872) .................................................

Edgar v. Haines, 109 Ohio St.159, 141 N.E. 837, (1923) . . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . ...10

Federal Home Loan Mtge. Corp v Rufo, 2012-Ohio-5930 . . .. . .. . . . . .. . . . . .. . .. . . . . .. . .. . . ... . . . . . . . . . .11,13

Bank ofNew York v. Dobbs, 2009-Ohio-4742 . . .. . . . . . . . .. . .. . .. . .. . .. . .. . .. . .. . . . . . . . .. . .. • • • • • • ' ' ' ' " ...... 1111ompson, 2010-Ohio-4158 ............................................... ................HSBCBankv. Thompson,

kron v. Rowland, 67 Ohio St.3d 374 (1993) .................... ........ ............... .......... ......... ..1112Deutsche Bank Natl. Trust Co. v. Rudulph, 2012-Ohio-6141 . . .. . . . . .. . . . . . . . .. . . . . .. . .. . . . . .. . . . . .. . . . . ..12Bank ofNew York Mellon Trust Co. v. Unger, 2012-Ohio-1950 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

LSF6 Mercury REO Invs. Trust Series 2008 v Locke, 2012-Ohio-4499 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Livonia Prop Holdings v. 12840-129 76 Farmington Rd. Holdings, LLC,717 F.Supp.2d 724, (E.D. Mich. 2010) ........................................... .......... ............ ......12

Bridge v. Aames Capital Corp, N.D. Ohio No. 1:09 CV 2947,2010 U.S. Dist. LEXIS 10351 (2010) ............. ......... ..................... .... .. . .. . . .... . .. . .......12

Bank ofNew York v. Unger, Cuyahoga Co. Case No. CV09-711343 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..13

Coulson v. Coulson, 5 Ohio St.3d 12 (1983) 13,14

Se Jones, 2013-Ohio-868 .........................................................13lf-Help Ventures Fund v.

State ex rel Sassano v Bender, 128 Ohio St.3d 1441, 944 N.E.2d 692, 2011-Ohio-1618 ..... ..........14

In Re Foreclosure Cases, N.D. Ohio Case No. 1:07CV2292, U.S. Dist LEXIS 84011 (2007).... .....14

STATUTES:

R.C. 1303.21 (B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 . ..19

R.C. 1303.21 ..................................................................................................10,R.C. 1303.22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,11

11............................................................................R.C. 1303.31......................11R.C. 1303.01 .....................................................................................................

....................................................................... 13R.C. 2921.11 ............................. 13R.C. 2913.42(B)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

CONSTITUTIONAL PROVISIONS: 5

United States Constitution,14^' Amendment Section I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . .. . . . . . . . .... 6.14,1

SECONDARY AUTHORI T Y: 11

Restatement III, Property (Mortgages), Section 5.4 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .

CONSENT DECREES:

Federal Reserve, Consent Order 11-029-B-HC ... ... ... ... ... ... ... ... ... ... ... ... ... ..... ... ... ... ... ... ... ... ... ... 8

Office of the Comptroller of Currency, Consent Order AA-EG11-12 ... ... ... ... ... ... ... ... ... ... ... ... ....... 8

AN EXPLANATION OF WHY THIS CASE INVOLVES A SUBSTANTIALCONSTITUTIONAL ISSUE, AND IS OF GREAT GENERAL INTEREST

This case involves a substantial constitutional issue. Here, the exhibits attached to the

complaint itself conclusively demonstrate that the Plaintiff lacks standing to prosecute this action. The

record is utterly and completely bereft of any evidentiary quality materials upon which a court might

conclude that the Plaintiff had established standing. There is simply nothing to establish the subject

matter jurisdiction of the court. The only document which even attempts to document standing, an

Assignment of Mortgage, was executed by an employee of the counsel for Plaintiff, with no disclosure

of the obvious conflict of interest involved. In spite of this, the trial and appellate courts declined to

vacate the void judgment. Unfortunately, many tens of thousands of Ohio homeowners have been or

will be subject to foreclosure proceedings. The overwhelming majority will not retain counsel, either

due to a lack of financial ability to pay for it or a sense of guilt or shame in the face of being labeled a

"deadbeat who could not afford to pay their mortgage". Such a lopsided adversarial posture demands

that the Courts are vigilant to ensure that due process is followed prior to the rendering of any

decision.

A. This case involves a substantial Constitutional question.

Section I of the 14th Amendment to the United States Constitution specifies that no state shall

"deprive any person of life, liberty, or property, without due process of law; nor deny to any person

within its jurisdiction the equal protection of the laws." In the case at bar, the lower courts failed to

accord due process and proper consideration to the record and evidence, and as a result rendered a

decision inconsistent with both Ohio law and prior decisions of the Supreme Court of the United

States of America. This ruling threatens to deprive the appellant of his property, specifically the

home that is the subject of the foreclosure action. After Fed Home Loan Mtge Corp. v

Schwartzwald, 135 Ohio St.3d 13, 2012-Ohio-5017, many ohio courts have focused upon the use of

the word "or" at ¶28 , and held that because this Court chose to use "or" rather than "and", an

assignment of mortgage alone was sufficient to establish standing. The question of standing is not

answered so easily, as will be discussed in the Propositions of Law to follow.

B. This case is of great general interest.

Schwartzwald, id, held that standing of the Plaintiff upon filing of a foreclosure complaint was

a necessary prerequisite to the subject matter jurisdiction of the court. "Subject-matter jurisdiction

can never be waived; any decision entered without subject-matter jurisdiction is void." Pratts v.

Hurley, 102 Ohio.St.3d 81, 2004-Ohio-1980 ¶11. It is of great general interest that this Court issue

concrete guidance which must be applied to any standing analysis, because a flawed analysis can and

will result in judgments that are not voidable, but rather void ab initio. As this case demonstrates,

without such guidance, many courts will resort to interpretations which are not consistent with Ohio

law.

STATEMENT OF THE CASE AND FACTS

Statement of the Case

This case originated as a Complaint in Foreclosure in the Common Pleas Court of Lake

County, Ohio, as case no. 10CF000262. Default judgment was granted in favor of Plaintiff on May

12, 2010. Defendant filed- a Motion to VacateJudgment on Feb. 24, 2012. Plaintiff filed a Reply in

Opposition to Defendant Joseph Meister's 60(b)(5) Motion on March 9, 2012. Plaintiff then filed a

Motion for Confirmation of Sale and an Assignment of Bid on April 10' 2012.

The trial court denied Defendant's Motion to Vacate on Apri125, 2012, and confirmed the sale of the

property. Defendant/Appellant filed a timely appeal to the 11"` District Appeilate Court. T'ne 1 it'

District Appellate Court affirmed the trial court, issuing the initial opinion in BAC Home Loans

Servicing, LP v. Meister, 2012-Ohio-873 on March 11, 2013. Appellant filed a timely Motion for

Reconsideration, which the court denied on April 10t', 2013. This appeal originates from that denial.

Statement of the Facts

Plaintiff filed this Complaint on Jan 27, 2010. Prior to service, defendant received a letter from

Freddie Mac, as "owner" of the mortgage, notifying Defendant to expect an in-person visit to discuss

alternatives to foreclosure. Defendants received that visit, and subsequently entered into a"trial"

modification. Upon Service, Defendant contacted Plaintiff, and was told that the trial modification

resolved the foreclosure. Defendant then made regular monthly payments through Sept of 2011.

Concurrently with accepting those payments, Plaintiff continued to prosecute this foreclosure, a

practice known as "Dual Tracking", which is specifically prohibited by the Consent Decrees entered

into by Plaintiff with the Federal Reserve (Consent Order 11-029-B-HC), the Office of the

Comptroller of the Currency (Consent Order AA-EC-11-12) and the United States Department of

Justice/Ohio Attorney General, United States ofAmerica v. Bank ofAmerica, (2012), D.C. Cir. No.

1:12-cv-00361. While accepting payments from the Defendant, Plaintiff sought and obtained default

judgment in the foreclosure action. Well over one year after obtaining that judgment, Plaintiff notified

Defendant that the trial modification was denied, and demanded in excess of $9,000 to reinstate the

mortgage. When defendant failed to tender that amount, Plaintiff scheduled the Sheriff sale of the

property. Defendant concedes that any claims of promissory estoppel or breach of the covenant of

good faith and fair dealing were not raised at the lower court, and such claims are not the issue under

appeal today. The issue on appeal to this Court is the lack of both procedural and substantive due

process involved in the determination by both the trial and appellate courts below that the Plaintiff

establ?shed standing upon the filing of this complaint. The record simply does not support this

finding. Attached to the original foreclosure complaint were three exhibits, a Note, exhibit "A", dated

August 25, 2006, made payable "to the order of the Lender. Lender is America's Wholesale Lender".

The Note contained no endorsement or allonge that would indicate any sort of negotiation to BAC as

required by R.C. 1303.21(B).

Exhibit "B" was a mortgage, also dated August 25, 2006, which named "MERS" as "acting

solely as a nominee for Lender", and which named the Lender as "America's Wholesale Lender.....a

Corporation organized and existing under the laws of New York". However, a review of the

Business Search feature on the website of the New York Secretary of State reveals no such corporate

entity in existence on August 25, 2006.1 The non-existence of America's Wholesale Lender, as a

New York Corporation was not raised at any time in the lower court, but certainly would go toward

the lack of subject matter jurisdiction, and thus can be raised at any time, Pratts v Hurley, 102

Ohio.St.3d 81, supra.

Finally, attached to the original complaint, marked as Exhibit "C" was an Assignment of

Mortgage, prepared by Lerner Sampson and Rothfuss, counsel for Plaintiff, and signed by Shellie

Hill, purportedly as an "Assistant Secretary and Vice President" of MERS. Shellie Hill was an

employee of Lerner Sampson and Rothfuss, Counsel for Plaintiff. See Assignments of Error and Brief

ofAppellant Joseph A Meister). This Assignment purports to transfer "a certain mortgage" from

MERS (non-party to the note) to plaintiff, and is silent as to the Note.

The Motion for Default Judgment, filed April 19, 2010 is silent as to the status of the Plaintiff as the

holder of either the note or mortgage, with no explanation given and no attempt made to establish how

BAC Home Loans Servicing, LP could claun standing to foreclose under the authority of a non-

negotiated note made payable to a different party, and a mortgage made payable to a non-existent

party.

On appeal, the 11t' District Appellate Court held that the Assignment of Mortgage alone was

1http.//appext20.dos.nv.gov/c0m »ublic/CORPSEARCH ENTITY INFORMATIOI`T? nameid=3760418& co id=3753565& enti name=America%27s%20Wholesale%20Lender& name e=A& search e tsEGii^S

&p srch results paQe=O , last visited 5/22/2013

sufficient to transfer both the Note and the Mortgage. The court failed to consider the overwhelming

evidence that BAC was not a "person entitled to enforce" the note as required by R.C.1303.31, that the

note was not negotiated as required by R.C. 1303.21, and that even if the Assignxnent of Mortgage

was not a fraudulent document, it was still wholly ineffective to transfer the note as required by R.C.

1303.22. Ignoring the plain language of the statutes cited above, the court held that the assignment of

mortgage was sufficient to establish that BAC was the holder of both the note and the mortgage, and

thus plaintiff had standing. This court must accept this appeal, and clarify for all lower courts the

specific analysis necessary to determine the standing of a Plaintiff in a foreclosure action, as will be

discussed in the following Propositions of Law.

ARGUMENT IN SUPPORT OF PROPOSITIONS OF LAW

Proposition of Law No. 1: A Naked Assignment of Mortgage alone wiIl not establish the

standing of the Plaintiff in a foreclosure action.

The Supreme Court of the United States of America has held that "The note and mortgage are

inseparable; the former as essential, the latter as an incident. An assignment of the note carries the

mortgage with it, while an assignment of the mortgage alone is a nullity" Carpenter v Longan ,83 U.S.

271,274, 21 L.Ed 313 (1872). The Ohio Supreme Court has recognized this, as well see generally

Kernohan v Manns, 53 Ohio St. 118, 41 N.E. 258 (1872) and Edgar v. Haines, 109 Ohio St 159; 141

N.E. 837 (1923). This is consistent with the fact that the note is the debt, and the mortgage is merely

the security interest. A naked mortgage holder cannot have suffered any "injury" which would create a

justiciable matter over which any court would have subject matter jurisdiction.

Proposition of Law No. 2: AnAssignment of Mortgage alone is insufficient to establish that a

foreclosure plaintiff is entitled to enforce the Note.

The 11t' District Appellate Court determined that "The assignment of mortgage, though not

containing an express transfer of the note, was sufficient to transfer both the mortgage and the note"

BAC Home Loans Servicing, LP v Meister, 2013-Ohio-873, ¶10. The court relied upon its prior

holding in Federal Home Loan Mtge Corp. v Rufo, 2013-Ohio-5930. That ruling, in turn relied upon a

prior decision, Bank ofNew York v. Dobbs, 2009-Ohio-4742. Dobbs relied upon Section 5.4 of the

Restatement III, Property (Mortgages), which "asserts as it'.s central premise that it is nearly always

sensible to keep the mortgage and the right of the enforcement of the obligation it secures in the hands

of the same party. This is because in a practical sense, separating the mortgage from the underlying

obligation destroys the efficacy of the mortgage, and the Note becomes unsecured". Dobbs, ¶28. The

Dobbs court then concludes because it is sensible to keep the mortgage and note together, and because

the Assignment of Mortgage in Dobbs specifically purports to transfer the Note, that the assignment

was thus an effective transfer of both. The Rufo court then used that holding, and added to it the

holding that it was not necessary for the Assignment of Mortgage to include a specific reference to the

note. This process of Franken-synthesis consisted of lowering the bar in Dobbs, lowering it further in

Rufo, and finally removing it completely in Meister, the case at a bar.

This is line of reasoning simply ignores the plain language of the Ohio Revised Code. A

much better precedent would be HSBC Bank USA v. Thompson, 2010-Ohio-4158, ¶45-¶87, in which

the court conducts a detailed analysis of the relevant Ohio Revised Code sections, R.C. 1303.31, R.C.

1303.22, R.C 1303.21, R.C. 1303.01, looking at the statutory definitions of "person entitled to

enforce", "bearer", "holder", weighing the evidence presented, and finding that that evidence was

insufficient to meet the statutory definition necessary to confer standing to the Plaintiff. This court

should instruct all lower courts in Ohio to conduct the same rigid analysis, rather than a franken-

synthesis as applied in the case at bar which ignores the plain language of the relevant statutes.

"Moreover, the court cannot ignore the plain language of the statute, nor can it assert operative

provisions that are not there" Akron v Rowland (1993), 67 Ohio St.3d 374,380.

Proposition of Law No. 3: In order to have standing to prosecute a mortgage foreclosure action,

the foreclosing party must be entitled to enforce the note when the complaint is filed.

This proposition of law is not new, it was Proposition of Law No. 1 inFed Home Loan Mtge Corp. v

Schwartzwald, 135 Ohio St.3d 13, 2012-Ohio-5017. Unfortunately, ambiguity in the Opinion in

Schwartzwald, or rather, an extremely narrow interpretation of the meaning of the word "or" at ¶28, has

led to this appeal, and certainly will lead to others. This court held that "Thus, because it failed to

establish an interest in the note or mortgage at the time it filed suit, it had no standing to invoke the

jurisdiction of the common pleas court." Scliwartzwald, id at ¶28, (emphasis added). This court should

clarify that "or" in this context was intended to be a disjunctive, rather than conjunctive. Put another

way, Schwartzwald, id holds that a foreclosure plaintiff must demonstrate an interest in BOTH the

mortgage and the note to establish standing. An interest in only one without the other does not

establish standing.

Proposition of Law No. 4: A borrower has standing to challenge an assignment of mortgage

under limited circumstances.

The Plaintiff/Appelle argued to the lower court that the Defendant/Appellant lacked standing to

challenge the validity of the assignment of mortgage, and the Appellate court held that such a challenge

"is a defense that must be timely established at the trial court", relying upon Deutsche Bank Natl. Trust

Co. v Rudolph, 8tb Dist. No. 98383, 2012-Ohio-6141, ¶24, appeal not accepted, Case Announcements,

2013-Ohio-1857, Bank of New YorkMellon Trust Co. v Unger, 8th Dist. No. 97315, 2012-Ohio-

1950,¶35, LSF6 Mercury REO Invs. Trust Series 2008-1 v. Locke, 1e Dist. No. 11AP-757, 2012-

Ohio-4499, ¶29. This line of cases relies upon a mischaracterization of the holdings from two federal

cases, Livonia Prop. Holdings v. 12840-12976 Farmington Rd Holdings, LLC, 717 F.Supp.2d 724, 735

(E.D.Mich.,2010) and Bridge v. Aames Capital Corp., N.D. Ohio No. 1:09 CV 2947,2010 U.S. Dist.

LEXIS 103151 (2010). A closer reading of both cases, however, indicates that the holding is not that

a borrower never has standing to challenge an assignment of mortgage, but rather that the specific facts

of the case will determine whether standing exists or not. In Livonia, the plaintiff produced the

original note for the inspection of the defendant, the note contained the proper endorsements, and the

Plaintiff produced affidavits and direct testimony to establish the chain of ownership and/or holder

status. The Livonia court held that, with those specific facts, "In light of these compelling authorities, I

hold that Borrower may not challenge the validity of assignments to which it was not a party or third

party beneficiary, where it has not been prejudiced, and the paL•-ties to the assignments do not dispute

(and in fact affirm) their validity" Livonia, supra, ¶29. The facts of the case at bar are very different.

Here, there are is only a copy of the note, it contains no endorsements, there are no affidavits or

testimony, and the assignment itself was executed by an employee of Plaintiff's counsel. Under such

circumstances, a defendant is highly prejudiced if not allowed to challenge such "evidence".

Proposition of Law No. 5: Evidence which is created by counsel without disclosure of the

inherent conflict of interest falls under the provisions of Civ.R. 60(B)(5).

Finally, the Assignment of Mortgage itself, executed by Shellie Hill, a paid employee of counsel for the

Plaintiff, represents an issue of such concern that it simply must be addressed. Imagine a judicial

system where, lacking any other evidence, a prosecutor simply instructs a clerical employee to fabricate

a document to prove his case. Or, alternatively, imagine if a desperate homeowner executed a

"Release and Satisfaction of Mortgage" and then filed it with the county recorder in an attempt to avoid

foreclosure? That prosecutor would be swiftly disbarred, that homeowner would find themselves

charged with violations of R.C. 2921.11, a felony of the fifth degree, or of violations of R.C.

2913.42(B)(4), a felony of the third degree. Appellant requested that the lower court take judicial

notice of the deposition of Shellie Hill2, taken as part of the proceedings in Bank of New York v.

Unger, Cuyahoga Co. Case No. CV09-711343. Appellant requests that this Court take the same

judicial notice. This Court has previously held that when a court relies upon representations made by

an attorney, where it would not have done so had it known of the misrepresentation, that attorney

perpetrates a fraud upon the court. Coulson v Coulson, 5 Ohio St.3d 12 (1983), at syllabus. Here,

faced with a client presenting an unendorsed note and no evidence whatsoever of standing, Lerner

Sampson and Rothfuss opted to prepare an assignment of mortgage, and have their employee, Shellie

Hill, execute that assignment as a "Vice President and Assistant Secretary". LSR then caused that

document to be filed with the Lake County Recorder, and presented that document to the court as the

orily evidence in the record to establish the standing of their client. The 11ffi Appellate Court has

issued multiple opinions which make clear that, absent that Assignment, the court would have

dismissed the case at bar. see Federal Home Loan Corporation v. Rufo, 11th Dist. No. 2012-A-0011,

2012-Ohio-5930,¶44 -45. See also Self-Help Ventures Fund v. Jones, 11'h Dist. No. 2012-A-0014,

2013-Ohio-868, ¶27. Throughout these proceedings, Lemer Sampson and Rothfuss has repeatedly

attempted to obfuscate and downplay the fraud that they have perpetrated upon the court i_n_ this case,

rather than admit to it or simply rectify it. This Court should recognize these actions as being "that

2 h_ //www scribd com/doc/46418118/Full Deposition-of-Shellie-Hill-of-Lerner-Sampson-amp-Rothfuss , last

visited 5/22/2013

species of fraud which does or attempts to defile the court itself.....fraud perpetrated by the officers of

the court so that the judicial machinery can not perform in the usual manner it's impartial task of

adjudging cases" Coulson, id..

In State ex rel Sassano v Bender, 128 Ohio St. 3d 1441, 944 N.E.2d 692, 2011 Ohio 1618, this court

authorized a model proposal. The Common Pleas Court of Franklin County, concerned over just such

abuses as are presented in the case at bar, initiated a requirement that attorneys prosecuting foreclosure

actions simply certify to the accuracy of the pleadings and evidence. Defendant/Appellant would

respectfully argue to this court that the facts surrounding the assignment in the case at bar would

suggest that the policy of Franklin County should be expanded to include the entire state of Ohio.

CONCLUSION

In 2011 alone, 71,556 foreclosure cases were filed throughout the state of Ohio3. Only 245

cases were resolved via trial. As Judge Christoper Boyko of the United States District Court for the

Northern District of Ohio, Eastern Division noted in late 2007,

"Typically, the homeowner who finds himself/herself in financial straits, fails to make the

required mortgage payments and faces a foreclosure suit, is not interested in testing state or

federal jurisdictional requirements, either pro se or through counsel. Their focus is either,

"how do I save my home," or "if I have to give it up, I'll simply leave and find somewhere

else to live.....(U)nchallenged by underfinanced opponents, the institutions worry less about

jurisdictional requirements, and more about maxiinizing returns."

In Re Foreclosure Cases, (2007) N.D.Ohio No. 1:07CV2292, 2007 U.S. Dist. LEXIS 84011.

Many judges throughout the country struggle with the "fairness" of ruling in favor of a homeowner

who has not made mortgage payments, thinking that to do so rewards an "irresponsible borrower"

with a "free house". However, that tliinking fails to consider the other side of the equation, that

rubber stamping judgments based upon a process of franken synthesis which igtiores plain statutory

language sends a message to the citizens of Ohio, and indeed the entire country, that justice is simply

different if you are a big corporation or have sufficient financial resources to influence the judicial

process. In refusing to hear this appeal, `4r,is Co'art would effectively affiirm that procedural and

substantive due process simply does not apply to the average citizen in a dispute with a big bank or

mortgage company. The end result is that a foreclosure will be allowed to deprive a citizen of

3 http://Www.supremecourt.ohio.gov/Publications/annrep/i IOCS/4.pdf

property in spite of the complete lack of any evidence to indicate the standing of the Plaintiff. Simply

put, the message would be that the rules of the Ohio Revised Code just don't apply to Plaintiffs like

BAC Home Loans Servicing, LP.

Alternatively, a reversal of the trial court decision will simply return things to the status quo

ante. Appellant will not have a free house, but rather a home still encumbered by a mortgage.

Appellant will still have all of the expenses of ownership, but will be unable to sell so long as the

mortgage remains of record. The mortgage/note holder will still have the remedy of foreclosure, so

long as they can properly meet the requirement of proof of standing. Appellant simply urges this

court to apply the same rules of procedural and substantive due process to all parties.

h A Meister, pro seJosep

Certificate of Service

I hereby Certify that on this day, May 23, 2013, a copy of the foregoing Notice of Appeal andMemorandum in Support of Jurisdiction was sent to Plaintiff s Attoxney via electronic mail, and

regular mail.

Patricia BlockJeffrey HelmsLerner Sampson and RothfussPO Box 5480Cincinnati, OH 45201-5480513-241-3000attyemail@lsrlaw.com

hhAMeistere9007 Woodridge Lane

Mentor, OH 44060

F

STATE OF OHIO

COUNTY OF LAKE

))SS.)

BAC HOME LOANS SERVICING, L.P.,f.k.a. COUNTRYWIDE HOME LOANSSERVICING, L.P.,

IN THE COURT OF APPEALS

ELEVENTH DISTRICT

JUDGMENT ENTRY

CASE NO. 2012-L-042Plaintiff-Appellee,

- vs -

JOSEPH A. MEISTER, et al.,

Defendant-Appellant.

FILEDCOURT OF APPEALS

APR '!UZ013

MAUREEN G. KELLYCLERK OF COUR'7

LAKE C•0UW'T'1', OHIO

On March 13, 2013, appellant, Joseph A. Meister, timely filed a motion

requesting this court reconsider our decision in BAC Home Loans Servicing, L.P.

v. Meister, 11th Dist. No. 2012-L-042, 2013-Ohio-873, pursuant to App.R.

26(A)(1). Appellee, BAC Home Loans Servicing, L.P. ("BAC"), filed a response

in opposition; appellant subsequently filed a reply. For the following reasons,

appellant's application is denied.

App.R. 26(A) does not provide specific guidelines to be used by an

appellate court when determining whether a prior decision should be

reconsidered or modified. State v. Black, 78 Ohio App.3d 130, 132 ( 1991).

However, the standard that has been generally accepted for addressing an

App.R. 26(A) motion was stated in Matthews v. Matthews, 5 Ohio App.3d 140

(1981). In Matthews, the court observed: "The test generally applied **'` is

whether the motion calls to the attention of the court an obvious error in its

decision or raises an issue for consideration that was either not considered at all

or was not fully considered by the court when it should have been." Id. at

paragraph two of the syllabus. An application for reconsideration is not designed

to be used in situations wherein a party simply disagrees with the logic employed

or the conclusions reached by an appellate court. State v. Owens, 112 Ohio

App.3d 334, 336 (1997). App.R. 26(A) is meant to provide a mechanism by

which a party may prevent a miscarriage of justice that could arise when an

appellate court makes an obvious error or renders a decision not supported by

the law. Id.

In Meister, we reviewed the trial court's denial of appellant's Civ.R. 60(B)

motion seeking relief from a default judgment, which resulted in foreclosure of his

real property. We determined, pursuant to Fed. Home Loan Mtge. Corp. v.

Schwartzwald, 135 Ohio St.3d 13, 2012-Ohio-5017, and Fed. Home Loan Mtge.

Corp. v. Rufo, 11th Dist. No. 2012-A-0011, 2012-Ohio-5930, that BAC

established it had standing at the time the complaint was filed to bring the

foreclosure against appellant. /d. at ¶10. We noted, "[t]he record indicates the

mortgage was assigned prior to the initiation of the action, a copy of which was

attached as `Exhibit C' to the complaint." Id. This court then determined that

appellant's Civ.R. 60(B) motion was untimely. Id. at ¶16.

In his application for reconsideration, appellant again argues BAC lacked

standing to file the complaint, though for different reasons than those outlined in

his original merit brief under his first assignment of error. Because an application

for reconsideration is not an opportunity to raise new arguments, we reject this

contention. See In re Estate of Traylor, 7th Dist. Nos. 03 MA 253-259 & 03 MA

2

262, 2005-Ohio-1348, ¶8

established it had standing.

Further, we have already concluded that BAC

Appellant additionally urges this court to reconsider his Civ.R. 60(B)

argument that BAC committed fraud upon the court. We did not reach the

underlying contentions of the fraud claim because we determined BAC

established it had standing at the time the complaint was filed to invoke the

subject matter jurisdiction of the trial court and because appellant's motion

seeking relief under Civ.R. 60(B)(3) was untimely. We concluded, "[a]s fraud by

an adverse party is expressly provided for in Civ.R. 60(B)(3), appellant may not

characterize his efforts as a Civ.R. 60(B)(5) attempt simply to avoid the one-year

time requirement." Id. at ¶16. It is apparent by his application that appellant

requests this court to explore the underlying merits of his fraud claim "[i]f for no

other reason than to resolve this question for future cases[.]" This is, however,

not a basis by which to grant an application for reopening, and as appellant has

not called to this court's attention an obvious error or an issue that should have

been considered in the first instance, we also reject this contention.

Assuming the merits of his fraud claim could be explored, appellant's

application would still fail. Appellant has suspicions that the individual who

signed the assignment instrument may not have had authority to assign the

mortgage to BAC. Though appellant contends this is tantamount to fraud by an

adverse party, he is essentially attacking the validity of the assignment. Aside

from the equivocal nature of his argument, appellant is precluded from asserting

such a claim. If there is any prior defect in the chain of acquisition of the

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assignment, that is a defense that must be timely established at the trial court.

Deutsche Bank Natl. Trust Co. v. Rudolph, 8th Dist. No. 98383, 2012-Ohio-6141,

¶24; Bank of New York Mellon Trust Co. v. Unger, 8th Dist. No. 97315, 2012-

Ohio-1950, ¶35; LSF6 Mercury REO lnvs. Trust Series 2008-1. v. Locke, 10th

Dist No. 11AP-757, 2012-Ohio-4499, ¶29.

Accordingly, appellant's application for reconsideration is hereby denied.

PRESIDING GE TIMOTHY P. CANNON

CYNTHIA WESTCOTT RICE, J.

THOMAS R. WRIGHT, J.,

concur.

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^ ^^ loo ^^[Cite as B.^CHorree Loans .Ser►^xcing, L.R. v. Meister°, 2013-Ohio-873.]

IN THE COURT OF APPEALS

ELEVENTH APPELLATE DISTRICT

LAKE COUNTY, OHIO

BAC HOME LOANS SERVICING, L.P. . O P I N I O N

f.k.a. COUNTRYWIDE HOME LOANSSERVICING, L.P., •

CASE NO. 2012-L-042

Plaintiff-Appellee,

- vs -

JOSEPH A. MEISTER, et al.,

Defendant-Appellant

Civil Appeal from the Lake County Court of Common Pleas, Case No. 10CF000262.

Judgment: Affirmed.

Jeffrey R. Helms and Patricia K. Block, Lerner, Sampson & Rothfuss, 120 East FourthStreet, 8th Floor, P.O. Box 5480, Cincinnati, OH 45201-5480 (For Plaintiff-Appellee).

Joseph A. Meister, pro se, 9007 Woodbridge Lane, Mentor, OH 44060 (Defe,ndant-

Appeiiant).

TIMOTHY P. CANNON, P.J.

{¶1l Appellant, Joseph A. Meister, pro se, appeais the judgment of the Lake

County Court of Common Pleas denying his Civ.R. 60(B) motion seeking relief from a

default judgment, which resulted in foreclosure of his real property. For the reasons that

follow, the judgment is affirmed.

{12} On January 27, 2010, appellee, BAC Home Loans Servicing, L.P. ("BAC"),

filed a complaint for foreclosure, alleging appellant's default on a note in the sum of

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$84,011.41, plus interest. The record indicates appellant was successfully served,

though he did not respond to the complaint. Upon BAC's motion, the court entered

default judgment in the amount set forth in the complaint on May 12, 2010. No appeal

was taken from this judgment.

{¶3} On February 24, 2012, appellant, represented by counsel, moved for relief

from the default judgment, pursuant to Civ.R. 60(B). In his motion, appellant alleged

that BAC committed a fraud upon the court in that it was not the owner of the note.

Appellant also attempted to stay the impending sheriffs sale, which was denied. The

real property, appraised at $78,000.00, was subsequently sold to appellee at sheriff s

sale for $52,000.00. Shortly thereafter, the trial court denied appellant's Civ.R. 60(B)

motion. In a later entry, the trial court confirmed the sale and denied appellant's motion

to stay.

{14} Appellant now appeals and presents three assignments of error for

consideration by this court. Appellant's first assignment of error states:

{¶5} The trial court committed prejudicial error in denying defendant-

appellant's motion to for relief [sic] from judgment, and

subsequently confirming the Sheriff Sale. The documents and

pleadings before the court demonstrate no justiciable matter

between Plaintiff BAG Home Loans Servicing, LP and Defendant

Joseph A. Meister. The court lacked subject matter jurisdiction to

hear the case upon filing, and thus the judgment rendered is VOID

ab rnigo.

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{1[6} Under his first assignment of error, appellant claims the trial court erred in

denying his Civ.R. 60(B)(5) motion because the documents before the court indicated

that BAC "was not the real party in interest" upon the filing of the complaint such that it

lacked standing to invoke the subject matter jurisdiction of the court. The lack of subject

matter jurisdiction is an issue that cannot be waived and may be raised at any time.

Byard v. Byler, 74 Ohio St.3d 294, 296 (1996). A claim that a trial court lacks subject

matter jurisdiction is reviewed de novo. Id.

I¶7} The issue of standing in the context of a mortgage foreclosure action has

developed significantly since the parties filed their briefs in this appeai. Previously, the

Ohio Supreme Court in State ex rel. Jones v. Suster, 84 Ohio St.3d 70 (1998) indicated

that standing is not jurisdictional, explaining that, pursuant to Civ.R. 17, "iack of standing

may be cured by substituting the proper party so that a court otherwise having subject

matter jurisdiction may proceed to adjudicate the matter." Id. at 77. Relying on this

proposition, this court held standing to not be jurisdictional. Aurora Loan Servs., LLC v.

Cart, 11th Dist. No. 2009-A-0026, 2010-CQhio-1157; Waterfall Vi"ctorra Master Fund Ltd.

v. Yeager, 11th Dist. No. 2011-L-025, 2012-Ohio-124; Everhome Mtge. Co. v. Berhrens,

11th Qist. No. 2011-L-128, 2012-Ohio-1454; Bank of New York Mellon Trust Co., N.A. v.

Shaffer, 11th Dist. No. 2011-G-3051, 2012-Ohio-3638.

{¶8} Recently, however, the Ohio Supreme Court released Fed. Home Loan

Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, wherein it criticized

Jones and held that standing is jurisdictional. Id. at ¶22 &¶29. As it is a jurisdictional

requirement, the Supreme Couri concluded that standing must be determined as of the

commencement of the suit. Id. at ¶24.

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It further emphasized that Civ.R. 17(A),

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requiring actions to be prosecuted in the name of the real party in interest, does not

address standing but, instead, merely concerns proper party joinder. Id. at ¶33. Thus,

"a lack of standing at the outset of litigation cannot [subsequently] be cured by receipt of

an assignment of the claim or by substitution of the real party in interest." (Emphasis

added.) Id. at ¶41.

t¶91 We recently had occasion to evaluate the import of Schwartzwafd as

applied to the p(or holdings of this court. (n Fed. Home Loan Mtge. Corp. v. Rufo, 11th

Dist. No. 2012-A-0011, 2012-C)hio-5930, we expressly overruled the holdings in Cart,

supra; Yeager, supra; Behren, supra; and Shaffer, supra, to the extent they were

inconsistent with Schwartzwatd. Id. at ¶29. Upon review, HSBC Bank v. Scacchi, 11th

Dist. No. 2012-G-3052, 2012-C)hio-5441, though not included in this list, must

additionally be overruled to the extent it is inconsistent with Schwartzwald on the issue

of standing.

{110} Turning, then, to the arguments advanced by appellant in this present

appeal, and in accord with our decision in--Rufo, BAC was "required to have an interest

in the r+ote^or rr ►ortgage when it filed this action in order to have standing to invoke the

jurisdiction of the trial court." Rufo at ¶30. The record indicates the mortgage was

assigned prior to the initiation of the action, a copy of which was attached as "Exhibit C"

to the complaint. The assignment of the mortgage, though not containing an express

transfer of the note, was sufficient to transfer both the mortgage and the note. Rufo at

¶44. The notarized assignment instrument attached to the complaint states that

Mortgage Electronic Registration Systems, Inc., as nominee for America's Wholesale

Lender, transferred the mortgage of the subject parcel to BAC. As BAC established it

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held the note at the time it filed the complaint, BAC established it had standing to bring

this foreclosure against appellant. Thus, we reject appellant's contention that the trial

court lacked subject matter jurisdiction to hear the case.

{4R11} Accordingly, appellant's first assignment of error is without merit.

{112} Appellant's second assignment of error states:

{1513} "The trial court committed prejudicial error in denying defendant-

appellant's Civ.R. 60(B)(5) motion for relief from judgment where the defautt judgment

was the result of fraud upon the court."

(1514) In his second assignment of error, appellant contends the trial court erred

in denying his Civ.R. 60(B) motion because BAC perpetuated a fraud upon the court by

purporting to own the mortgage via assignment when, in fact, it did not.

{¶15} To a certain extent, the merits of this contention are already addressed

above. As an additional point, however, it must be reiterated that a Civ.R. 60(B) motion

must be timely, i.e., not more than one year after the judgment or order was entered

where the grounds of relief are Civ.R. 60(B)(1)-(3); otherwise, the motion must be made

within a reasonable time. GTE Automatic Elec. v. ARC fndustrles, 47 Ohio St.2d 146

(1976), paragraph two of the syllabus.

{1516} Here, appellant's motion alleging fraud by BAC is untimely in that it was

made well after one year from the May 12, 2010 default judgment. Appellant argues he

is alleging fraud through Civ.R. 60(B)(5), which does not involve the one-year time

requirement. However, such section is a"catch-all° provision allowing parties to assert

grounds for relief not expressly enumerated else^aihere in the rule. See Caruso-Cirersi,

Inc. v. Lohman, 5 Ohio St.3d 64, 66 (1983) (explaining the grounds for invoking Civ.R.

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60(B)(5) must not be used as a "substitute for any of the other more specific provisions

of Civ.R. 60"). As fraud by an adverse party is express(y provided for in Civ.R. 60(B)(3),

appellant may not characterize his efforts as a Civ.R. 60(B)(5) attempt simply to avoid

the one-year time requirement. We recognize a party may use Civ.R. 60(B)(5) to raise

the issue of fraud upon the court; however, this concept has been distinguished from

fraud by an adverse party and has been carefully limited to the occasion where an

"afficer of the court`"^ actively.participates„indefrauding1he court.' Coulson v.

Coulson, 5 Ohio St.3d 12, 15 (1983). It therefore cannot be concluded that the trial

court abused its discretion in denying appellant's Civ.R. 60(B) motion.

[1[17} P,ppeliant's second assignment of error is without merit.

{¶18} Appellant's third assignment of error states:

{¶14} "The trial court committed prejudicial error in denying defendant-

appellant's Civ.R. 60(B)(5) motion for relief from judgment without first holding a hearing

to consider the merits of the appellants motion [sic]."

{¶2o} In his final assignment of error, appellant argues he was entitled to a

hearing on the Civ.R. 60(B) motion. It is well founded that "'[i]f the movant files a motion

for relief from judgment and it contains allegations of operative facts which would

warrant relief under Civil Rule 60(B), the trial court should grant a hearing to take

evidence and verify these facts before it rules on the motion."` Kay v. Marc Glassman,

Inc., 76 Ohio St.3d 18, 19 (1996), quoting Coulson v. Coulson, 5 Ohio St.3d 12, 16

(1983). As explained above, however, appellant did not set forth specific allegations of

operative facts that would warrant reiief. Therefore, as a hearing is not automatically

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required, and as no allegations were set forth which warranted relief, the court did not

abuse its discretion in failing to hold a hearing.

{¶21} Appellant's third assignment of error is without merit.

{1[221 The judgment of the Lake County Court of Common Pleas is affirmed.

CYNTHIA WESTCOTT RICE, J.,

THOMAS R. WRIGHT, J.,

concur.

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