Mid-American Nat. Bank & Trust Co. v. Gymnastics Internat'l, Inc.

• Decision Date: 16 April 1982
• Docket Number: MID-AMERICAN
• Citation: 6 OBR 34,451 N.E.2d 1243,6 Ohio App.3d 11
• Parties: , 6 O.B.R. 34 NATIONAL BANK & TRUST CO., Appellee, v. GYMNASTICS INTERNAT'L, INC.; Westgate Health Foods, Inc., Appellant. *
• Court: Ohio Court of Appeals

Page 11

6 Ohio App.3d 11

451 N.E.2d 1243, 6 O.B.R. 34

MID-AMERICAN NATIONAL BANK & TRUST CO., Appellee, v. GYMNASTICS INTERNAT'L, INC.; Westgate Health Foods, Inc., Appellant. ^*

Court of Appeals of Ohio, Sixth District, Lucas County.

April 16, 1982.

Syllabus by the Court

Where there is a corporate mortgagor and the mortgage has been executed on behalf of the corporation by its president and by its secretary-treasurer, and the certificate of acknowledgment executed by the notary public states that the corporation, itself, is the mortgagor, and the names of the president and secretary-treasurer do not appear therein, the acknowledgment is not defective because it fails to state the names of the officers of the corporation who signed the mortgage; said acknowledgment substantially complies with the essential requisites of R.C. 5301.01.

Robert Pollex, Perrysburg, for appellee.

Joseph D. Shibley, Toledo, for appellant.

PER CURIAM.

Defendant-appellant, Westgate Health Foods, Inc., appeals the August 3, 1981, decision of the Lucas County Court of Common Pleas which granted the motion of plaintiff-appellee, Mid-American National Bank & Trust Co., for summary judgment as to the validity of its mortgage dated November 10, 1976.

Gymnastics International, Inc., obtained several loans from Mid-American National Bank. These loans were secured by a mortgage on the real estate which is the subject of the case sub judice. Said mortgage was filed November 12, 1976. Subsequently, Gymnastics International, Inc., failed to make certain payments and breached the terms of the mortgage.

Mid-American National Bank filed an action, inter alia, to foreclose on the mortgage. Joined as defendants were all parties having an interest in the property in question.

Defendants challenged the validity of plaintiff's mortgage due to an alleged defective acknowledgment. Defendants alleged that the mortgage as filed on November 12, 1976, was invalid and did not create a lien with priority over subsequently recorded deeds and mortgages.

The trial court found that the acknowledgments substantially complied with R.C. 147.55(B) regarding the recitals to be included in a certificate of acknowledgment. The trial court found that the plaintiff's mortgage had priority as of the date of its recording on November 12, 1976.

Westgate Health Foods, Inc., is the only defendant appealing the trial court's decision. It presents the following assignments of error:

"1. The trial court erred prejudicially in finding that the acknowledgment to appellee's mortgage was in 'substantial compliance' with law.

"2. The trial court erred prejudicially in finding that the acknowledgment to appellee's mortgage was valid and effective since it did not set forth the facts required by O.R.C. § 147.53, § 147.54, § 147.55 and § 5301.01.

"3. The judgment of the trial court is contrary to law for the reason that the appellee's mortgage was defectively acknowledged at the time appellant recorded its mortgage on the same real estate and therefore was without any effect at law or in equity against third persons including appellant.

"4. The judgment of the trial court is contrary to law for the reason that the appellee's mortgage was defectively acknowledged at the time appellant recorded its mortgage on the same real estate and therefore was not entitled to be recorded."

Appellant alleges that the following acknowledgment is defective:

"State of Ohio, Lucas County, SS:

"Before me, a Notary Public within and for said County, personally appeared the above named grantors and mortgagors, Gymnastics International Inc., an Ohio Corporation, and acknowledged the signing and sealing of the foregoing conveyance to be their voluntary act and deed, for the uses and purposes therein expressed."

R.C. 5301.01 governs the case sub judice. As applied to this case, R.C. 5301.01 requires that a mortgage must be signed by the mortgagor, and the signing acknowledged by the mortgagor in the presence of two witnesses who attest the signing and subscribe their names to the attestation. This section further provides that such signing must be acknowledged by the mortgagor before a notary public or other public officer, who shall certify the acknowledgment and subscribe his name to the certificate of such acknowledgment.

A review of the document at issue indicates the mortgagor, Gymnastics International, Inc., appearing through its president, James S. Bassett, and its secretary-treasurer, Benjamin B. Durfee, signed the mortgage and acknowledged the mortgage in the presence of two witnesses. These two witnesses attested the signing and subscribed their names to the attestation. The additional requirement of R.C. 5301.01 is that the mortgagor's acknowledgment be certified by a notary public.

The acknowledgment before a notary public, or any other public official mentioned in R.C. 5301.01, includes the formal execution of the certificate by the officer taking the acknowledgment. The issue in the case sub judice is whether the recitals in the certificate of acknowledgment substantially comply with the requirements of R.C. 5301.01. More specifically, the question involves whether the recital that "personally appeared the above named grantors and mortgagors, Gymnastics International, Inc., an Ohio Corporation," without mentioning who appeared personally on behalf of the corporation, is so defective as to omit a substantial part of the requirements of R.C. 5301.01.

Appellant relies on the case of Smith's Lessee v. Hunt (1844), 13 Ohio 260, where the court held that an acknowledgment which omits the name of the mortgagor is defective. We do not find Smith's Lessee, supra, determinative in the case sub judice, which involves an incomplete description of the grantor and not the total omission as in Smith's Lessee. We find persuasive the principle enunciated in Dodd v. Bartholomew (1886), 44 Ohio St. 171, 5 N.E....