Other Courts are starting to agree with the concept.
Alexander vs. Deutsche Bank National Trust Co. (N.D. Ohio West Dis.)
Case No.: 3:12-CV-02704;
BAC Home Loan Serv. v. McFerren (
App. 9th Dist.), 2013-Ohio-3228; Ohio
Wells Fargo Bank, N.A. v. Erobobo, et al., 2013 WL 1831799
April 29, 2013); and Ct.
In Re Saldivar (June 5, 2013), United States District Court,Southern District of Texas, case No. 11-10689.
The United States District Court, Bankruptcy Court for the Northern District of Ohio, decision in Alexander vs. Deutsche Bank National Trust Co. (N.D. Ohio West Dis.) Case No.: 3:12-CV-02704, stated:
A number of
appellate courts have applied the general principal that a debtor may not Ohio
challenge an assignment between an assignor and an assignee and concluded that, under
law, a mortgagor does not have standing to challenge an assignment of a mortgage. Ohio
Alexander Court then discusses the cases typically relied upon to challenge the Homeowners ability to raise the failure to comply with the PSA: Bank of New York Mellon Trust Co. v. Unger; LSF6 Mercury REO Invests. Trust Series 2008-1 v. Locke; and Deutsche Bank Nat’l Trust Co. v. Rudolph. These cases are then discussed in light of Fed. Home Loan Mortg. Corp. v. Schwartzwald.
“It does not follow, however, that Alexander is wholly barred from challenging the assignment. The Supreme Court of Ohio acknowledged the general principle “that standing is a ‘jurisdictional requirement’” that, if not present, subjects the complaint to dismissal. Schwartzwald, 979 N.E.2d at 1219. The court also stated “[w]here [a] party does not rely on any specific statute authorizing invocation of the judicial process, the question of standing depends on whether the party has alleged . . . a ‘personal stake in the outcome of the controversy.’”
Id. (quoting Cleveland v. Shaker Heights, 507 N.E.2d 323, 325 ( 1987)). As the Sixth Circuit has noted, “[a]n obligor ‘may assert as a defense any matter which renders the assignment absolutely invalid or ineffective, or void.’ . . . Obligors have standing to raise these claims because they cannot otherwise protect themselves from having to pay the same debt twice.” Ohio Prop. Holdings, L.L.C. v. 12840-12976 Farmington Road Holdings, L.L.C., Livonia 399 F. App’x 97, 102 (6th Cir. 2010) (citing 6A C.J.S. Assignments § 132 (2010)).
BAC Home Loan Serv. v. McFerren (
App. 9th Dist.), 2013-Ohio-3228. While the Ohio McFerren Court did not address the issue, at footnote 4, the Court stated:
We note that it is unclear why a foreclosure defendant would lack “standing” to raise issues concerning the legal effect of prior assignments or other transactions in defending the foreclosure action. In that context, the defendant may raise legally relevant defenses as such would relate to the character of the obligation (i.e. secured or not secured) and to whom the obligation is actually owed (in cases of multiple assignments, to avoid the risk that multiple parties claim the right to collect). Bank of America relies upon
Props. Holdings, LLC v. Livonia 12840-12976 Farmington Rd. Holdings, LLC, 399 Fed.Appx. 97 (6th Cir.2010), and Bridge v. Aames Capital Corp., N.D.Ohio No. 1:09 CV 2947, 2010 WL 3834059 (Sept. 29, 2010), in support. However, the procedural posture and substantive issues addressed in those cases are distinct from the instant matter and those cases do not stand for the blanket proposition that in all contexts an obligor may not raise defenses concerning the assignment of the obligation. Bridge is readily distinguishable because the mortgagor was a plaintiff seeking a declaratory judgment and the court addressed standing in the context of ’s declaratory judgment statute. Ohio Livonia addressed the question of the meaning of “record chain of title” under ’s foreclosure by advertisement statute. See id. at 99. Michigan
Both Wells Fargo Bank, N.A. v. Erobobo, et al., 2013 WL 1831799 (N.Y. Sup.
Hopefully, the above information will be helpful. Should any Homeowner or Attorney representing Homeowners need additional assistance, please contact my office.