Wilmington Sav. Fund Soc'y, FSB v. Salahuddin

165 N.E.3d 761

WILMINGTON SAVINGS FUND SOCIETY, FSB, d.b.a. Christiana Trust as Owner Trustee of the Residential Credit Opportunities Trust III, Plaintiff-Appellee,

v.Ameena C. SALAHUDDIN, Defendant-Appellant.

No. 19AP-190

Court of Appeals of Ohio, Tenth District, Franklin County.

Rendered on December 29, 2020

On brief: Keith D. Weiner & Associates Co., LPA and Suzana Krasnicki, Cleveland, for appellee. Argued: Suzana Krasnicki.

On brief: Ameena C. Salahuddin, pro se. Argued: Ameena C. Salahuddin.

DECISION

BRUNNER, J.

{¶ 1} Defendant-appellant, Ameena C. Salahuddin, pro se, appeals from a judgment entry and foreclosure decree of the Franklin County Court of Common Pleas entered on March 6, 2019, in favor of plaintiff-appellee, Wilmington Savings Fund Society, FSB, d.b.a. Christiana Trust as Owner of The Residential Credit Opportunities Trust III ("Wilmington"). In its decision, the trial court granted Wilmington's motion for summary judgment against Salahuddin and its motion for default judgment against other defendants who are not parties to this appeal. Additionally, the trial court dismissed Salahuddin's counterclaim against Wilmington and her motion for summary judgment. For the reasons that follow, we sustain in part and reverse in part the decision of the trial court and remand the matter for further proceedings consistent with this decision.

I. FACTS AND PROCEDURAL HISTORY

{¶ 2} The underlying foreclosure action commenced December 22, 2017, with the filing of a complaint for money damages, foreclosure, and other equitable relief by Wilmington that named as defendants Salahuddin and other parties not involved in this appeal.¹

{¶ 3} Salahuddin purchased a home at 6147 Olde Orchard Drive, Columbus, Ohio 43213 in 2008 with a loan she obtained from The American Eagle Mortgage Corp. On or about October 16, 2008, Salahuddin signed and delivered to The American Eagle Mortgage Corp. a promissory note ("the Note") in which she promised to pay The American Eagle Mortgage Corp. or its transferee the principal of $132,863.00, plus interest at the rate of 6.25 percent per annum. The loan was insured through the Federal Housing Administration ("FHA"). As part of the same transaction, Salahuddin signed and delivered the mortgage deed ("the Mortgage") for the Olde Orchard Drive home as security for the Note. The Note and the Mortgage were subsequently assigned to other entities, including JPMorgan Chase Bank, N.A., and ultimately to Wilmington.

{¶ 4} Wilmington claims Salahuddin has defaulted in payment of the Note. Consequently, Wilmington has declared the debt due, has accelerated the debt, and demands immediate payment in full. Wilmington attached to its complaint numerous exhibits, including a copy of the Note executed October 16, 2008, a copy of the Mortgage executed October 16, 2008, the assignments of the Mortgage from The American Eagle Mortgage Corp. to numerous successors until Wilmington, to which it was assigned on or about May 10, 2017.

{¶ 5} Salahuddin, pro se, filed a request for mediation on February 2, 2018 and, on February 12, 2018, filed her answer and counterclaim. Wilmington answered Salahuddin's counterclaim on March 12, 2018.

{¶ 6} The trial court referred the underlying matter to mediation. However, at the scheduled mediation hearing, Salahuddin indicated she did not wish to proceed without legal counsel and, therefore, mediation was not held. The trial court restored the underlying matter to the active docket and issued an order amending the case schedule.

{¶ 7} On September 24, 2018, Wilmington filed a motion for summary judgment against Salahuddin on its complaint and on Salahuddin's counterclaim against Wilmington. Wilmington attached in support of its motion the affidavit of Michael Surowiec,² Vice-President of Asset Management for AMIP Management, LLC, the mortgage servicer for Wilmington at the time the underlying action was filed. Attached as exhibits to the Surowiec affidavit were a stated true and accurate copy of the Note, a stated true and accurate copy of the Mortgage, stated true and accurate copies of the assignments of the Mortgage beginning February 20, 2013 through May 10, 2017, a stated true and accurate notice of default and intent to accelerate that Wilmington sent Salahuddin by both certified and first class mail on February 23, 2016, and a payment history of payments received on Salahuddin's loan. Also attached to the Surowiec affidavit were stated true and accurate copies of two letters JPMorgan Chase Bank, N.A. had sent to Salahuddin on October 9 and December 11, 2012 regarding her options to pay the past-due amount on the mortgage. Both letters also contained the following language, "[a]s required by [HUD], we have scheduled a JM Adjustment Services representative to visit your home on behalf of Chase within the next 20 days to discuss a possible repayment plan. * * * This face-to-face meeting could provide a solution to help you pay the past-due amount on your mortgage." (Ex. 9 at 1, 3, attached to Sept. 24, 2018 Wilmington's Mot. for Summ. Jgmt.) Neither contained a date for the face-to-face meeting that was referenced in each letter.

{¶ 8} On October 22, 2018, Salahuddin filed a motion requesting leave to file a memorandum contra Wilmington's motion for summary judgment, instanter. Salahuddin attached numerous exhibits to the motion, including an affidavit she had executed on October 8, 2015. The same date, she filed a motion for summary judgment and memorandum contra Wilmington's motion for summary judgment. On November 6, 2018, the trial court granted Salahuddin's motion for leave and accepted as filed the memorandum in opposition she had filed on October 22, 2018. The trial court also granted Wilmington additional time to respond to Salahuddin's motion for summary judgment and memorandum contra Wilmington's motion for summary judgment.

{¶ 9} On November 27, 2018, Wilmington filed a brief in opposition to Salahuddin's motion for summary judgment and reply brief in support of its motion for summary judgment. Wilmington included in its motion for summary judgment Paragraph 6(B) of the Note, which references HUD regulations limiting a lender's right to require immediate payment, which states as follows:

6. BORROWER'S FAILURE TO PAY

* * *

(B) Default

If Borrower defaults by failing to pay in full any monthly payment, then Lender may, except as limited by regulations of the Secretary in the case of payment defaults, require immediate payment in full of the principal balance remaining due and all accrued interest. Lender may choose not to exercise this option without waiving its rights in the event of any subsequent default. In many circumstances regulations issued by the Secretary will limit Lender's rights to require immediate payment in full in the case of payment defaults. This Note does not authorize acceleration when not permitted by HUD regulations. As used in this Note, "Secretary" means the Secretary of Housing and Urban Development or his or her designee.

(Emphasis sic.) (Ex. 1 at 2, attached to Wilmington's Mot. for Summ. Jgmt.)

{¶ 10} Paragraph 9(d) of the Mortgage provides:

9. Grounds for Acceleration of Debt.

* * *

(d) Regulations of HUD Secretary. In many circumstances regulations issued by the Secretary will limit Lender's rights. In the case of payment defaults, to require immediate payment in full and foreclose if not paid. This Security instrument does not authorize acceleration or foreclosure if not permitted by regulations of the Secretary.

(Emphasis sic.) (Ex. 2 at 5, attached to Wilmington's Mot. for Summ. Jgmt.)

{¶ 11} Wilmington also addressed Salahuddin's claim regarding Wilmington's failure to schedule a face-to-face meeting as required by 24 C.F.R. 203.604. Wilmington argued it was in compliance with the FHA regulations for face-to-face meetings, and stated in pertinent part:

Further, [Wilmington], even though it isn't located within 200 miles of the mortgaged property nor is its servicer, sent [Salahuddin] another request for a Face to Face [sic] Meeting. Said letter is dated July 14, 2017. Said letter was sent by certified mail, and after a visit to the property was completed, [Wilmington] was told that [Salahuddin] did not reside at the property, and that the property was rental property. (Fn. 1. See the Supplemental Affidavit of Michael Surowiec³ , ¶¶ 6-8, which is attached hereto, incorporated herein and marked as Exhibit A; see also the Exhibits attached to said Affidavit. The Supplemental Affidavit will be referred to as "Pl. Supp. Aff.") [Wilmington] was exempt from 24 CFR 203.604 but sent [Salahuddin] a request for a face to face meeting anyway to ensure compliance. [Salahuddin] avoided the meeting since the individuals whom opened the door advised [Wilmington] that they were renters, and the Ms. Salahuddin did not reside there. (Fn. 2. Pl. Supp. Aff. ¶¶ 6-8.)

24 CFR 203.604 requires that the mortgagor make a reasonable effort to arrange a face to face meeting, and such reasonable effort requires that a letter be sent out and a visit to the property be made, as long as the property is within 200 miles of the lender or its servicer. * * * There is no requirement that [Wilmington] actually meet with [Salahuddin]; the only requirement is that a reasonable effort be made to make contact with [Salahuddin]. Both JPMorgan Chase and [Wilmington] attempted to make contact with [Salahuddin]. [Salahuddin] is obviously avoiding contact so that she can later try to allege that [Wilmington] did not comply with the regulations. * * *

* * *

[Wilmington] also directs the [trial court] to [Salahuddin's] Affidavit, which was attached to her Motion for Summary Judgment, at ¶ 5, where she states that no one ever conducted a face to face meeting with her. It is important to note here that [Salahuddin] doesn't say that she never received the letters sent to her regarding the face to face meetings, and further, she doesn't say that no one ever came to the property to conduct a

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