Preview
ELECTRONICALLY FILED
COURT OF COMMON PLEAS
Thursday, March 04, 2010 9:35:49 AM
CASE NUMBER: 2007 CV 09571 Docket ID: 14848272
GREGORY A BRUSH
CLERK OF COURTS MONTGOMERY COUNTY OHIO
IN THE MONTGOMERY COUNTY
COURT OF COMMON PLEAS
U.S. Bank N.A. as Trustee )
) CASE NO. 2007 CV 9571
Plaintiff )
)
v. )
) JUDGE: CONNIE S. PRICE
) Magistrate David Fuchsman
Wesley A. Quinn et al. )
) DEFENDANTS’ OBJECTIONS TO
Defendants. ) MAGISTRATE’S DECISION
)
)
)
Under Rule 53, Wesley and Marion Quinn object to the Magistrate’s Decision
finding that they did not present a meritorious defense under Rule 60 (B), because U.S.
Bank had standing to file for foreclosure.
At the time of filing, U.S. Bank was not a person entitled to enforce the Note
under the U.C.C and nor did it have a written Mortgage Assignment as required by Ohio
law. Yet, in finding standing, the Magistrate determined that U.S. Bank was in
possession of an unendorsed Note with the rights of the holder and had an “equitable”
assignment of the Mortgage at the time of filing. The Magistrate’s Decision goes against
the evidence presented and fails to comply with Ohio’s foreclosure jurisprudence. As
such, the Quinn’s respectfully request that this Court overturn the Magistrate’s Decision.
In support, the Quinns state the following:
MAGISTRATE’S FINDINGS OF FACT
The Magistrate found that U.S. Bank failed to prove by a preponderance of the
evidence that is was a holder of the Note at the time the Complaint was filed.1 The
Magistrate further found that the Mortgage Assignment to U.S. Bank occurred two
months after the Complaint was filed.2 The Magistrate went on to consider:
[W]hether Plaintiff U.S. Bank was a real party in interest at the time suit was filed
and a ‘mortgagee’ of the mortgage at the time suit was filed, even though formal
assignment of the mortgage and negotiation and endorsement of the note more
likely than not did not occur until after the Complaint was file.3
In its considerations, the Magistrate determined that New Century transferred the
unendorsed Note to U.S. Bank as trustee through a bulk transfer in June of 2006.4 The
Magistrate also found that U.S. Bank did not possess the negotiated Note until
sometime around December 19, 2009.5 The Complaint was filed on November 14, 2007
and Judgment was entered on February 11, 2008.6 The Mortgage Assignment occurred
on January 17, 2008. 7
As part of its findings, the Magistrate considered U.S. Bank’s Trust Agreement.8
The Trust Agreement provides that the Depositor acquire the Mortgage Loans from the
Seller, and at the Closing date is the owner of the Mortgage Loans being conveyed by it
1
Magistrate’s Decision at pages 6, 12, 14. (Defendant’s Exhibit 1).
2
Magistrate’s Decision at pages 2-3, 12. (Defendant’s Exhibit 1).
3
Magistrate’s Decision at page 12. (Defendant’s Exhibit 1).
4
Magistrate’s Decision at page 16. (Defendant’s Exhibit 1).
5
Magistrate’s Decision at page 14. (Defendant’s Exhibit 1).
6
Magistrate’s Decision at pages 2-3. (Defendant’s Exhibit 1).
7
Magistrate’s Decision at page 2. (Defendant’s Exhibit 1).
8
Magistrate’s Decision at page 3 fn 9. (Defendant’s Exhibit 1).
to the Trustee, U.S. Bank, at the execution and delivery of the agreement.9 The Closing
Date is defined as June 22, 2006.10 The Trust Agreement defines the Mortgage Loan as
being “the orginal Mortgage Note endorsed without recourse in proper form to the
order of the Trustee, or in Blank.”11
MAGISTRATE’S CONCLUSIONS OF LAW
The Magistrate found that the Quinns did not present a meritorious defense
under Rule 60 (B), since U.S. Bank had standing to foreclose. 12 In support of this
finding, the Magistrate concluded that at the time the Complaint was filed, U.S. Bank
was a “nonholder in possession of the instrument who has the rights of a holder” under
the U.C.C. Ohio R.C. § 1303.31(A)(2) “Person entitled to enforce instrument.”13 The
Magistrate went on to conclude that when U. S. Bank became a nonholder in possession,
U.S. Bank acquired an equitable interest in the Mortgage providing it with standing to
file foreclosure.14
ARGUMENT
The Magistrate’s findings of fact, the Trust Agreement, and Ohio law show that
U.S. Bank did not have standing to file the foreclosure action. U.S. Bank did not possess
the original Note nor was it the Mortgagee at the time foreclosure was filed or even by
the time Judgment was entered in its favor. Accordingly, the Quinns respectfully
request that this Court overturn the Magistrate’s Decision with regard to standing.
9
Trust Agreement at page 8, 60, 62. (Defendant’s Exhibit 2).
10
Trust Agreement at page 29. (Defendant’s Exhibit 2).
11
Trust Agreement at page 63. (Defendant’s Exhibit 2). (emphasis added).
12
Magistrate’s Decision at page 11. (Defendant’s Exhibit 1).
13
Magistrate’s Decision at page 15. (Defendant’s Exhibit 1).
14
Magistrate’s Decision at page 15-17. (Defendant’s Exhibit 1).
U.S. BANK DID NOT POSSESS ORIGINAL NOTE
The Magistrate concluded that U.S. Bank became a “nonholder in possession” of
the Note in June of 2006. To be considered a “nonholder in possession,” U.S. Bank
would have had to provide evidence of how it came into possession of the original
Note.15 The Magistrate determined that U.S. Bank’s proof derived from the June 2006
transaction under which U.S. Bank acquired Mortgage Loans. 16
The Trust Agreement that U.S. Bank filed with the Court provided for the
guidelines of how and when the Mortgage Loans would be purchased and transferred to
it as Trustee. The Trust Agreement set out that U.S. Bank would receive endorsed Notes
from the Depositor at the execution of the Agreement in June of 2006.17 As such, it is
unreasonable to believe that U.S. Bank would have possession of the original Note
without it containing an endorsement as the Magistrate concludes. It is more likely that
if U.S. Bank had possession of the original Note, it would have already been endorsed.
(To clarify, the Quinn’s are not arguing that U.S. Bank received the Note in violation of
the Trust Agreement, but that U.S. Bank did not have possession of the original Note at
the time of filing nor at the time it received a foreclosure judgment, assuming it ever
actually received it).
The Magistrate found that the evidence suggested U.S. Bank did not receive the
endorsed Note until more than three years after the Trust Agreement had been executed
and almost two years after filing of the Complaint. Taking this as true, along with the
terms of the Trust Agreement, U.S. Bank was not a “holder” or a “nonholder in
15
Ohio Rev. Code §§1303.22 and 1303.31; Official Comment of U.C.C. 3-203(Proof of transfer to the transferee by
a holder is proof that the transferee has acquired rights of the holder).
16
Magistrate’s Decision at page 16 (“Plaintiff is able to account for its possession of the unendorsed note by proving
the underlying transaction though which Plaintiff acquired the note, i.e. the June 2006 purchase”) (Defendant’s
Exhibit 1).
17
Trust Agreement at pages 29, 63 (Defendant’s Exhibit 2).
possession” of the Note at the time the Complaint was filed as is required to have
standing to foreclose.18
THE ENACTMENT OF THE STATUTE OF FRAUDS EVISERATES THE COMMON
LAW PRINCPLE OF “EQUITABLE ASSIGNMENT OF THE MORTGAGE”
Even assuming U.S. Bank was a nonholder in possession of the Note under the
U.C.C. at the time that the Complaint was filed, by all accounts, it was not the
Mortgagee. A party lacks standing to bring a foreclosure action, if at the time the action
is filed, the party had not yet been assigned an interest in the mortgage and a later
assignment of the mortgage does not cure this defect.19 Against Ohio Law, the
Magistrate concluded that since U.S. Bank was a nonholder in possession of the Note at
the time of filing , this possession operated as an equitable assignment of the Mortgage.
This conclusion is flawed and based on old common law concepts that have been
replaced with specific legislation.
In particular, the cases finding equitable assignment were decided before the
legislative enactment of the Statute of Frauds.20 The Statute of Frauds mandates that
any interest in land be granted in writing.21 It states:
No lease, estate, or interest, either of freehold or term of years, or any uncertain
interest of, in, or out of lands, tenements, or hereditaments, shall be assigned or
granted except by deed, or note in writing, signed by the party assigning or
18
Countrywide Home Loans v. Montgomery, 2010-Ohio 693 (6th Dist. App. Ct. February 26, 2010)(foreclosure
standing requires Plaintiff to be current holder of the note and mortgage; later assignment of mortgage is not
enough) (citations omitted).
19
Wells Fargo, N.A. v. Byrd, 178 Ohio App.3d 285 (2008); Wells Fargo,N.A. v. Jordan, Slip Op.#91675,
2009 Ohio 1092 (8th Dist. App. Ct. March 12, 2009); Avelo Mortgage v. Chasteen, Ohio Cir. Dec.
2008CV3518 (Montgomery County C.P. Nov. 18, 2008); Deutsche Bank v. Blackshear, Ohio Cir. Dec.
2008CV10104 (Montgomery County C.P. April 15, 2009); Deutsche Bank v. Kenion, Ohio Cir. Dec.
2008CV5080 (Montgomery County C.P. Feb. 18, 2009).
20
See: Edgar v. Haines, 109 Ohio St. 159 (1923); Kuck v. Sommers, 100 N.E.2d 68, Oh Abs. 400 (1950);
Statute of Frauds, Ohio Rev. Code §1335.4 (1953).
21
R.C.§1335.4
granting it, or his agent thereunto lawfully authorized, by writing, or by act and
operation of law.
In the case of mortgage loans, the mortgage represents the interest in the land
and the note represents the debt.22 As such, the mortgage and note constitute separate
contracts that give rise to distinct remedies.23 The mortgage provides a suit in equity to
foreclose and the note provides a suit in law on the debt itself.24 Therefore, to foreclose,
the plaintiff must have an interest in the mortgage. And under the Statute of Frauds,
this interest must be given in writing and cannot just be considered a tag along interest
without written proof.
A current case that relies on the equitable assignment concept is U.S. Bank v.
Marcino. 25 Marcino, however, relies on the older cases and never addresses the
legislative enactment of the Statute of Frauds.26 Wholly ignoring the Statute of Frauds,
Marcino determined that the Uniform Commercial Code codified the equitable
mortgage assignment common law. In particular, Marcino points to Section
1309.203(G), which states:
The attachment of a security interest in a right to payment or performance
secured by a security interest or other lien on personal or real property is
also attachment of a security interest in the security interest, mortgage,
or other lien.
This section merely states that a note secured by real property is automatically
connected with the encumbering mortgage. But this section is not to be read in a
vacuum. The Statute of Frauds makes clear that in order to actually receive an interest
in land, the interest has to be given in writing and signed by the party assigning the
22
Fifth Third Bank v. Hopkins, 177 Ohio App.3d 114, 119-120; 2008-Ohio-2959(9th Dist. App. Ct. 2008).
23
Id. at 120.
24
Id. at 119-120.
25
Id. at 14.
26
See: U.S. Bank Nat’l Assoc. v. Marcino, et al. 2009 Ohio 1178 (7th Dist. App. Ct. March 10, 2009).
interest. 27 If this is not done, the current mortgage holder is the owner of the mortgage.
But due to the undeniable relationship between the note and mortgage, the mortgage
holder, in effect, becomes the trustee for the note holder. Until the note holder is the
actual owner of the mortgage, it has no right to foreclose on the property and only
retains the right to obtain a money judgment based on the debt.28
The Statute of Frauds requirements also provide title companies with assurances
about whom or what entity actually has an interest in the mortgage. Without such a
requirement, a title company would not in good conscience be able to provide clear title,
because it would have no idea what entity actually has been “equitably” assigned the
mortgage. Therefore, not only does the law support the written requirement, but it just
makes sense that in modern times an interest in land, such as a mortgage, could only be
transferred in writing.
As such, even assuming U.S. Bank was a nonholder in possession of the Note
under the U.C.C., because there is mortgage assignment is untimely, it could have only
brought an action for money damages related to the Note debt. U.S. Bank did not have
standing to foreclose.
CONCLUSION
As the above proves, U.S. Bank did not have standing to file the foreclosure
action. The Magistrate’s Decision to the contrary was in error. Therefore, the Quinns
27
Ohio Rev. Code §1335.04.
28
See: National City Bank v. Abdalla, 131 Ohio App.3d 204, 210 (1999) (An action in foreclosure is one for relief other
than money); Fifth Third Bank v. Hopkins, 177 Ohio App.3d at 119 (A foreclosure action is an equitable action based upon the
breach of the mortgage agreement. But in a foreclosure action, suit on the note debt is not foreclosed by the disposition of a previous
foreclosure, because the note remains independent of the mortgage and is a separate, enforceable contract).
have asserted a meritorious defense under Rule 60 (B). Their motion to vacate the
foreclosure judgment should be granted. Accordingly, the Quinns respectfully request
that this Court overturn the Magistrate’s Decision with regard to standing.
Respectfully submitted,
_/S/ Randall J. Smith______________
Randall J. Smith (000079)
Attorney for Defendant Wesley and Marion Quinn
Miami Valley Fair Housing Center, Inc.
21-23 East Babbitt Street
Dayton, OH 45405-4968
Phone (937) 223-6035
Fax (937) 223-6279
e-mail: randy.smith@mvfairhousing.com
CERTIFICATE OF SERVICE
I certify that on March 3, 2010 I electronically filed the foregoing with the Clerk
of Courts using the CM>ECF system which will send notification of such filing to the
following:
DEANNA C.STOUTENBOROUGH COLETTE S. CARR
ATTORNEY FOR PLAINTIFF MONTGOMERY COUNTY
LERNER, SAMPSON & ROTHFUSS TREASURER
P.O. BOX 5480 451 W. THIRD STREET
CINCINNATI, OH 45201-5480 DAYTON, OH 45422-1475
CHASE HOME FINANCE LLC
10790 RANCHO BERNARDO ROAD
SAN DIEGO, CA 92127
_/S/ Randall J. Smith_______________
Randall J. Smith (0000079)
Preview
ELECTRONICALLY FILED COURT OF COMMON PLEAS Thursday, March 04, 2010 9:35:49 AM CASE NUMBER: 2007 CV 09571 Docket ID: 14848272 GREGORY A BRUSH CLERK OF COURTS MONTGOMERY COUNTY OHIO IN THE MONTGOMERY COUNTY COURT OF COMMON PLEAS U.S. Bank N.A. as Trustee ) ) CASE NO. 2007 CV 9571 Plaintiff ) ) v. ) ) JUDGE: CONNIE S. PRICE ) Magistrate David Fuchsman Wesley A. Quinn et al. ) ) DEFENDANTS’ OBJECTIONS TO Defendants. ) MAGISTRATE’S DECISION ) ) ) Under Rule 53, Wesley and Marion Quinn object to the Magistrate’s Decision finding that they did not present a meritorious defense under Rule 60 (B), because U.S. Bank had standing to file for foreclosure. At the time of filing, U.S. Bank was not a person entitled to enforce the Note under the U.C.C and nor did it have a written Mortgage Assignment as required by Ohio law. Yet, in finding standing, the Magistrate determined that U.S. Bank was in possession of an unendorsed Note with the rights of the holder and had an “equitable” assignment of the Mortgage at the time of filing. The Magistrate’s Decision goes against the evidence presented and fails to comply with Ohio’s foreclosure jurisprudence. As such, the Quinn’s respectfully request that this Court overturn the Magistrate’s Decision. In support, the Quinns state the following: MAGISTRATE’S FINDINGS OF FACT The Magistrate found that U.S. Bank failed to prove by a preponderance of the evidence that is was a holder of the Note at the time the Complaint was filed.1 The Magistrate further found that the Mortgage Assignment to U.S. Bank occurred two months after the Complaint was filed.2 The Magistrate went on to consider: [W]hether Plaintiff U.S. Bank was a real party in interest at the time suit was filed and a ‘mortgagee’ of the mortgage at the time suit was filed, even though formal assignment of the mortgage and negotiation and endorsement of the note more likely than not did not occur until after the Complaint was file.3 In its considerations, the Magistrate determined that New Century transferred the unendorsed Note to U.S. Bank as trustee through a bulk transfer in June of 2006.4 The Magistrate also found that U.S. Bank did not possess the negotiated Note until sometime around December 19, 2009.5 The Complaint was filed on November 14, 2007 and Judgment was entered on February 11, 2008.6 The Mortgage Assignment occurred on January 17, 2008. 7 As part of its findings, the Magistrate considered U.S. Bank’s Trust Agreement.8 The Trust Agreement provides that the Depositor acquire the Mortgage Loans from the Seller, and at the Closing date is the owner of the Mortgage Loans being conveyed by it 1 Magistrate’s Decision at pages 6, 12, 14. (Defendant’s Exhibit 1). 2 Magistrate’s Decision at pages 2-3, 12. (Defendant’s Exhibit 1). 3 Magistrate’s Decision at page 12. (Defendant’s Exhibit 1). 4 Magistrate’s Decision at page 16. (Defendant’s Exhibit 1). 5 Magistrate’s Decision at page 14. (Defendant’s Exhibit 1). 6 Magistrate’s Decision at pages 2-3. (Defendant’s Exhibit 1). 7 Magistrate’s Decision at page 2. (Defendant’s Exhibit 1). 8 Magistrate’s Decision at page 3 fn 9. (Defendant’s Exhibit 1). to the Trustee, U.S. Bank, at the execution and delivery of the agreement.9 The Closing Date is defined as June 22, 2006.10 The Trust Agreement defines the Mortgage Loan as being “the orginal Mortgage Note endorsed without recourse in proper form to the order of the Trustee, or in Blank.”11 MAGISTRATE’S CONCLUSIONS OF LAW The Magistrate found that the Quinns did not present a meritorious defense under Rule 60 (B), since U.S. Bank had standing to foreclose. 12 In support of this finding, the Magistrate concluded that at the time the Complaint was filed, U.S. Bank was a “nonholder in possession of the instrument who has the rights of a holder” under the U.C.C. Ohio R.C. § 1303.31(A)(2) “Person entitled to enforce instrument.”13 The Magistrate went on to conclude that when U. S. Bank became a nonholder in possession, U.S. Bank acquired an equitable interest in the Mortgage providing it with standing to file foreclosure.14 ARGUMENT The Magistrate’s findings of fact, the Trust Agreement, and Ohio law show that U.S. Bank did not have standing to file the foreclosure action. U.S. Bank did not possess the original Note nor was it the Mortgagee at the time foreclosure was filed or even by the time Judgment was entered in its favor. Accordingly, the Quinns respectfully request that this Court overturn the Magistrate’s Decision with regard to standing. 9 Trust Agreement at page 8, 60, 62. (Defendant’s Exhibit 2). 10 Trust Agreement at page 29. (Defendant’s Exhibit 2). 11 Trust Agreement at page 63. (Defendant’s Exhibit 2). (emphasis added). 12 Magistrate’s Decision at page 11. (Defendant’s Exhibit 1). 13 Magistrate’s Decision at page 15. (Defendant’s Exhibit 1). 14 Magistrate’s Decision at page 15-17. (Defendant’s Exhibit 1). U.S. BANK DID NOT POSSESS ORIGINAL NOTE The Magistrate concluded that U.S. Bank became a “nonholder in possession” of the Note in June of 2006. To be considered a “nonholder in possession,” U.S. Bank would have had to provide evidence of how it came into possession of the original Note.15 The Magistrate determined that U.S. Bank’s proof derived from the June 2006 transaction under which U.S. Bank acquired Mortgage Loans. 16 The Trust Agreement that U.S. Bank filed with the Court provided for the guidelines of how and when the Mortgage Loans would be purchased and transferred to it as Trustee. The Trust Agreement set out that U.S. Bank would receive endorsed Notes from the Depositor at the execution of the Agreement in June of 2006.17 As such, it is unreasonable to believe that U.S. Bank would have possession of the original Note without it containing an endorsement as the Magistrate concludes. It is more likely that if U.S. Bank had possession of the original Note, it would have already been endorsed. (To clarify, the Quinn’s are not arguing that U.S. Bank received the Note in violation of the Trust Agreement, but that U.S. Bank did not have possession of the original Note at the time of filing nor at the time it received a foreclosure judgment, assuming it ever actually received it). The Magistrate found that the evidence suggested U.S. Bank did not receive the endorsed Note until more than three years after the Trust Agreement had been executed and almost two years after filing of the Complaint. Taking this as true, along with the terms of the Trust Agreement, U.S. Bank was not a “holder” or a “nonholder in 15 Ohio Rev. Code §§1303.22 and 1303.31; Official Comment of U.C.C. 3-203(Proof of transfer to the transferee by a holder is proof that the transferee has acquired rights of the holder). 16 Magistrate’s Decision at page 16 (“Plaintiff is able to account for its possession of the unendorsed note by proving the underlying transaction though which Plaintiff acquired the note, i.e. the June 2006 purchase”) (Defendant’s Exhibit 1). 17 Trust Agreement at pages 29, 63 (Defendant’s Exhibit 2). possession” of the Note at the time the Complaint was filed as is required to have standing to foreclose.18 THE ENACTMENT OF THE STATUTE OF FRAUDS EVISERATES THE COMMON LAW PRINCPLE OF “EQUITABLE ASSIGNMENT OF THE MORTGAGE” Even assuming U.S. Bank was a nonholder in possession of the Note under the U.C.C. at the time that the Complaint was filed, by all accounts, it was not the Mortgagee. A party lacks standing to bring a foreclosure action, if at the time the action is filed, the party had not yet been assigned an interest in the mortgage and a later assignment of the mortgage does not cure this defect.19 Against Ohio Law, the Magistrate concluded that since U.S. Bank was a nonholder in possession of the Note at the time of filing , this possession operated as an equitable assignment of the Mortgage. This conclusion is flawed and based on old common law concepts that have been replaced with specific legislation. In particular, the cases finding equitable assignment were decided before the legislative enactment of the Statute of Frauds.20 The Statute of Frauds mandates that any interest in land be granted in writing.21 It states: No lease, estate, or interest, either of freehold or term of years, or any uncertain interest of, in, or out of lands, tenements, or hereditaments, shall be assigned or granted except by deed, or note in writing, signed by the party assigning or 18 Countrywide Home Loans v. Montgomery, 2010-Ohio 693 (6th Dist. App. Ct. February 26, 2010)(foreclosure standing requires Plaintiff to be current holder of the note and mortgage; later assignment of mortgage is not enough) (citations omitted). 19 Wells Fargo, N.A. v. Byrd, 178 Ohio App.3d 285 (2008); Wells Fargo,N.A. v. Jordan, Slip Op.#91675, 2009 Ohio 1092 (8th Dist. App. Ct. March 12, 2009); Avelo Mortgage v. Chasteen, Ohio Cir. Dec. 2008CV3518 (Montgomery County C.P. Nov. 18, 2008); Deutsche Bank v. Blackshear, Ohio Cir. Dec. 2008CV10104 (Montgomery County C.P. April 15, 2009); Deutsche Bank v. Kenion, Ohio Cir. Dec. 2008CV5080 (Montgomery County C.P. Feb. 18, 2009). 20 See: Edgar v. Haines, 109 Ohio St. 159 (1923); Kuck v. Sommers, 100 N.E.2d 68, Oh Abs. 400 (1950); Statute of Frauds, Ohio Rev. Code §1335.4 (1953). 21 R.C.§1335.4 granting it, or his agent thereunto lawfully authorized, by writing, or by act and operation of law. In the case of mortgage loans, the mortgage represents the interest in the land and the note represents the debt.22 As such, the mortgage and note constitute separate contracts that give rise to distinct remedies.23 The mortgage provides a suit in equity to foreclose and the note provides a suit in law on the debt itself.24 Therefore, to foreclose, the plaintiff must have an interest in the mortgage. And under the Statute of Frauds, this interest must be given in writing and cannot just be considered a tag along interest without written proof. A current case that relies on the equitable assignment concept is U.S. Bank v. Marcino. 25 Marcino, however, relies on the older cases and never addresses the legislative enactment of the Statute of Frauds.26 Wholly ignoring the Statute of Frauds, Marcino determined that the Uniform Commercial Code codified the equitable mortgage assignment common law. In particular, Marcino points to Section 1309.203(G), which states: The attachment of a security interest in a right to payment or performance secured by a security interest or other lien on personal or real property is also attachment of a security interest in the security interest, mortgage, or other lien. This section merely states that a note secured by real property is automatically connected with the encumbering mortgage. But this section is not to be read in a vacuum. The Statute of Frauds makes clear that in order to actually receive an interest in land, the interest has to be given in writing and signed by the party assigning the 22 Fifth Third Bank v. Hopkins, 177 Ohio App.3d 114, 119-120; 2008-Ohio-2959(9th Dist. App. Ct. 2008). 23 Id. at 120. 24 Id. at 119-120. 25 Id. at 14. 26 See: U.S. Bank Nat’l Assoc. v. Marcino, et al. 2009 Ohio 1178 (7th Dist. App. Ct. March 10, 2009). interest. 27 If this is not done, the current mortgage holder is the owner of the mortgage. But due to the undeniable relationship between the note and mortgage, the mortgage holder, in effect, becomes the trustee for the note holder. Until the note holder is the actual owner of the mortgage, it has no right to foreclose on the property and only retains the right to obtain a money judgment based on the debt.28 The Statute of Frauds requirements also provide title companies with assurances about whom or what entity actually has an interest in the mortgage. Without such a requirement, a title company would not in good conscience be able to provide clear title, because it would have no idea what entity actually has been “equitably” assigned the mortgage. Therefore, not only does the law support the written requirement, but it just makes sense that in modern times an interest in land, such as a mortgage, could only be transferred in writing. As such, even assuming U.S. Bank was a nonholder in possession of the Note under the U.C.C., because there is mortgage assignment is untimely, it could have only brought an action for money damages related to the Note debt. U.S. Bank did not have standing to foreclose. CONCLUSION As the above proves, U.S. Bank did not have standing to file the foreclosure action. The Magistrate’s Decision to the contrary was in error. Therefore, the Quinns 27 Ohio Rev. Code §1335.04. 28 See: National City Bank v. Abdalla, 131 Ohio App.3d 204, 210 (1999) (An action in foreclosure is one for relief other than money); Fifth Third Bank v. Hopkins, 177 Ohio App.3d at 119 (A foreclosure action is an equitable action based upon the breach of the mortgage agreement. But in a foreclosure action, suit on the note debt is not foreclosed by the disposition of a previous foreclosure, because the note remains independent of the mortgage and is a separate, enforceable contract). have asserted a meritorious defense under Rule 60 (B). Their motion to vacate the foreclosure judgment should be granted. Accordingly, the Quinns respectfully request that this Court overturn the Magistrate’s Decision with regard to standing. Respectfully submitted, _/S/ Randall J. Smith______________ Randall J. Smith (000079) Attorney for Defendant Wesley and Marion Quinn Miami Valley Fair Housing Center, Inc. 21-23 East Babbitt Street Dayton, OH 45405-4968 Phone (937) 223-6035 Fax (937) 223-6279 e-mail: randy.smith@mvfairhousing.com CERTIFICATE OF SERVICE I certify that on March 3, 2010 I electronically filed the foregoing with the Clerk of Courts using the CM>ECF system which will send notification of such filing to the following: DEANNA C.STOUTENBOROUGH COLETTE S. CARR ATTORNEY FOR PLAINTIFF MONTGOMERY COUNTY LERNER, SAMPSON & ROTHFUSS TREASURER P.O. BOX 5480 451 W. THIRD STREET CINCINNATI, OH 45201-5480 DAYTON, OH 45422-1475 CHASE HOME FINANCE LLC 10790 RANCHO BERNARDO ROAD SAN DIEGO, CA 92127 _/S/ Randall J. Smith_______________ Randall J. Smith (0000079)