Nat'l City Real Estate Servs. LLC v. Frazier

• Decision Date: 23 February 2018
• Docket Number: No. 17CA3585,17CA3585
• Parties: NATIONAL CITY REAL ESTATE SERVICES LLC, Plaintiff–Appellant, v. Joseph R. FRAZIER, et al., Defendants–Appellee.
• Court: Ohio Court of Appeals

96 N.E.3d 311

2018 Ohio 982

NATIONAL CITY REAL ESTATE SERVICES LLC, Plaintiff–Appellant,

v.Joseph R. FRAZIER, et al., Defendants–Appellee.

No. 17CA3585

Court of Appeals of Ohio, Fourth District, Ross County.

DATE JOURNALIZED: February 23, 2018

H. Toby Schisler and Alicia A. Bond–Lewis, Cincinnati, Ohio, for appellant.

Thomas M. Spetnagel, Chillicothe, Ohio, for appellee.

DECISION AND JUDGMENT ENTRY

ABELE, J.

{¶ 1} This is an appeal from a Ross County Common Pleas Court judgment that (1) partially entered summary judgment in favor of PNC Bank, National Association,¹ plaintiff below and appellant herein, in its foreclosure action against Joseph R. Frazier and Sonja L. Frazier, defendants below and appellee herein, and (2) granted appellee's motion to dismiss Sonja L. Frazier, now deceased, pursuant to Civ.R. 25(A)(1).²

{¶ 2} Appellant assigns the following errors for review:

FIRST ASSIGNMENT OF ERROR:

"THE TRIAL COURT ERRED BY PRECLUDING REFORMATION OF THE MORTGAGE TO GIVE PNC A FIRST AND BEST LIEN UPON THE RESIDENTIAL PARCEL."

SECOND ASSIGNMENT OF ERROR:

"THE TRIAL COURT ERRED BY GRANTING APPELLEES' MOTION FOR SUMMARY JUDGMENT ON THE CLAIM TO REFORM THE MORTGAGE."

THIRD ASSIGNMENT OF ERROR:

"THE TRIAL COURT ERRED BY DENYING PNC'S MOTION TO SUBSTITUTE SONJA FRAZIER'S ESTATE FOR MS. FRAZIER AND DISMISSING THE CLAIMS AGAINST MS. FRAZIER."

{¶ 3} The Fraziers jointly owned two adjacent parcels located at 918 Lunbeck Road—a 1.02 acre residential lot and a 0.559 acre vacant lot. The parcel number of the residential lot is 24–1611274–000. The parcel number of the vacant lot is 24–1611577–000.

{¶ 4} In 2001, the Fraziers applied for a mortgage with National City Bank. The Fraziers completed a Uniform Residential Loan Application that (1) listed the property address as "918 Lunbeck Rd., Chillicothe, OH 45601," (2) indicated the purpose of the loan was to refinance, (3) stated that the property would be the primary residence, (4) documented that the property was acquired and "[b]uilt" in 1974, (5) that improvements in the form of "deck, decorating, [c]arpet" were made, and (6) that the property was "1Fam."

{¶ 5} An appraisal report similarly reflected that the property involved residential property. The appraisal (1) describes the property as consisting of 1.02 acres, with electricity, water, and a septic system, (2) states that an interior and exterior inspection were performed, (3) describes the property as a one-story, detached building consisting of "WD, ALUM, BRK," with a "COMP SHGL" roof surface, and (4) includes the parcel number of the residential lot. The appraisal also includes photographs of the "subject property" that show the appraised property is a building. The appraisal also includes a floorplan that illustrates the layout of the building, with square footage calculations. The building consists of three bedrooms, a bathroom, a kitchen, a dining room, a living room, a deck, and a patio. The square footage is listed as "1100." The appraisal estimated the property value as $138,000.

{¶ 6} The Fraziers also signed a "Survey Affidavit." Their affidavit states that they own 918 Lunbeck Road as shown on the attached survey and that the survey "correctly represents the layout and improvements on the Property." The attached survey lists two parcels: (1) a 1.02 acre tract; and (2) a 0.559 acre tract. The illustration of the 0.559 acre tract includes the following writing: "Per owner 0.559 acre tract not included in mortgage."

{¶ 7} The Fraziers signed a note that listed the property address as "918 Lunbeck Rd., Chillicothe, Ohio 45601" and that promised to repay $107,000. The mortgage stated that the Fraziers agreed to "mortgage, grant and convey * * * the following described property * * * 918 Lunbeck Rd., Chillicothe, Ohio 45601." The parcel identification number was left blank. The mortgage included an occupancy covenant that stated the Fraziers would use the mortgaged property as their "principal residence."

{¶ 8} The legal description attached to the mortgage reads:

EXHIBIT A—LEGAL DESCRIPTION

Situate in the State of Ohio, County of Ross, Township of Scioto, being part of the remainder of a 23 acre tract and all of the remainder of a 0.71 acre tract as conveyed to Timothy L. Webb and Janet R. Webb by deed of record in Vol. 479 P. 165 Recorder's Office, Ross County, Ohio and being more particularly bounded and described as follows:

Beginning at a point ¾? i.p. (fnd) at the southwest comer of a 1.02 acre tract as conveyed to Joseph R. Frazier and Sonja L. Frazier by deed of record in Vol. 384 Pg. 110 Recorder's Office, Ross County, Ohio, said point also being at a northeasterly corner of the remainder of the said 23 acre tract;

Thence N 42° 39'10? E a distance of 200.00' (passing a ¾? I.P. fnd at 168.50') along the southerly line of the said 1.02 acre tract, and along a northerly line of the remainder of the said 23 acre tract, and also along a northerly line of the remainder of the said 0.71 acre tract to a point in the centerline of a small stream, said point being in a westerly line of the remainder of 65.1 acre tract as conveyed to Ray E. Depugh and Joan Depugh by deed of record in vol. 305 Pg. 254 Recorder's Office, Ross County, Ohio;

Thence S 18° 00' 00? E a distance of 117.91' along the centerline of the said stream, and along an easterly line of the remainder of the said 0.71 acre tract, and also along the westerly line of the remainder of the said 65.1 acre tract to a point at the southeast comer of the said 0.71 acre tract, said point also being the northwest comer of a 1.03 acre tract as conveyed to Ray E. Depugh and Joan R. Depugh by deed of record in Vol. 384 Pg. 106 Recorder's Office, Ross County, Ohio;

Thence along the centerline of the said stream, and along westerly lines of the said 1.03 acre tract, and also along easterly lines of the remainder of the said 23 acre tract by the following described (2) courses:

S 18° 00' 00? E a distance of 34.39' to a point;

S 32° 00' 00? E a distance of 40.68' to a point;

Thence through the tract of which this is a part by the following described (2) courses;

S 54° 22' 55? W a distance of 109.14' (passing a 5/8? i.p. set at 30.00') to 5/8? i.p. (set);

S 50° 18' 06? w a distance of 150.00' to the point of beginning containing 0.559 acres more or less, subject to all easements, restrictions, and rights-of-way- of record.

This Description was prepared from a field survey made by Ronald C. Donahue Jr. in August 1991.

The bearings contained herein are based on the bearings of the said 1.02 acre tract as conveyed to Joseph and Sonja Frazier.

Parcel Number: 24–1611274–000 and 24–1611577.000

Commonly Known As: 918 Lunbeck Road, Chillicothe, Ohio 45601

{¶ 9} Subsequently, the Fraziers defaulted on their note and mortgage obligations. Thus, in 2009 National City filed a foreclosure complaint. National City attached to its complaint the mortgage with the above legal description. A preliminary report revealed, however, that the metes and bounds description³ attached to the mortgage described the vacant lot. National City later amended the complaint to request that the court reform the mortgage to include the metes and bounds description of the residential lot. National City alleged that the legal description is "incomplete" and resulted from a "scrivener's error and mutual mistake of fact." National City thus asserted that it is entitled to have the mortgage reformed in order to include the metes and bounds description of the residential property.

{¶ 10} National City subsequently filed a summary judgment motion and argued that the evidence shows that the parties intended to encumber both the residential and vacant lots, but by mutual mistake, the metes and bounds description attached to the mortgage did not describe both properties. National City (1) pointed out that the Fraziers' loan application clearly indicates that both the vacant lot and the residential parcel were intended to be encumbered by the mortgage; (2) claimed that the property appraisal shows that both parcels were intended to be encumbered by the mortgage; and (3) asserted that the amount of the mortgage—$107,000—demonstrates that the parties intended to encumber the residential lot. National City argued that a $107,000 mortgage for a 0.559 acre vacant parcel is not reasonable.

{¶ 11} The case later was stayed pending bankruptcy proceedings. During the stay, Mrs. Frazier died. On December 11, 2015, shortly after the court reactivated the proceedings, the Fraziers' counsel filed a notice of suggestion of death.

{¶ 12} In January 2016, the Fraziers filed a combined memorandum in opposition to National City's summary judgment motion and a cross-motion for partial summary judgment. Although the Fraziers did not dispute National City's right to judgment on the note and to foreclose upon the mortgage, they did however dispute National City's reformation claim. The Fraziers asserted that no genuine issues of material fact exist as to whether National City's failure to include the legal description of the residential property constitutes inexcusable negligence so as to preclude its reformation claim. They thus claimed that they are entitled to judgment as a matter of law with respect to National City's reformation claim.

{¶ 13} The Fraziers attached appellee's affidavit to support their cross-summary judgment motion. In his affidavit, appellee attests that he and Mrs. Frazier "were aware at the closing that [National City] apparently chose to omit the residential parcel from the property described in the mortgage deed and that thereafter they quit-claimed their interest in the residential parcel to their children as part of their estate planning."⁴

{¶ 14} In response, National City argued that the evidence shows that the parties obviously intended to encumber the residential property. National City asserted that the mortgage includes the property address and the parcel number for the residential parcel. National City recognized that the metes and...