IN THE COURT OF APPEALS OF OHIO

SECOND APPELLATE DIVISION

Wells Fargo Bank NA. as Trustee for Securitized
No. 023136
Asset Backed Receivables LLC 2006-OP1
Mortgage Pass-Through Certificates,
Series 2006 OP1
Plaintiff,

C.A. Case

v.
John A. Reed, et al.
Defendant
DEFENDANTS MOTION TO VACATE
Now comes Defendant John A. Reed (Defendant), for this
motion to vacate this Courts November 13th 2008 judgment
entry granting Plaintiff Wells Fargo Bank NA. as Trustee for
Securitized Asset Backed Receivables LLC 2006-OP1 Mortgage
Pass-Through Certificates, Series 2006 OP1 (Plaintiff) motion
of judgment on the basis of the State of Ohios Supreme Courts
October 31, 2012 holding in Federal Home Loan Mortgage
Corporation v. Schwartzwald, 2012-Ohio-5017.
Resp
ectfully submitted,
________________________
John A. Reed
40 Maple Ave..
Centerville, Ohio
45459
937-890-2576
Yotraj@Yahoo.com

SERVICE
A true and exact copy of the foregoing has been served
this 16th day of August, 2010 via email as follows:
Attys for Plaintif
Amelia A. Bower (0013474)
and
David Van Slyke (0077721)
300 East Broad St., Suite 590
Columbus, Ohio 43235
Via email @ abower@plunkettcooney.com
And dvanslyke@plunkettcooney.com
and
Sara M. Petersmann 0055402
Lerner, Sampson & Rothfuss
P.O. Box 5480
Cincinnati, Ohio 45201-5480
Via email @ attyemail@lsrlaw.com
Atty for Defendant John L. Reed
Thomas W. Kendo
7925 Paragon Rd.
Dayton, Ohio 45459
Via email @ tkendo@midam-title.com
CERTIFICATE OF SERVICE
THE UNDERSIGNED HEREBY CERTIFIES that a true
and correct copy of the foregoing has been forwarded, via U,

Introductory Statement
As an initial matter, Defendant freely acknowledges that
Plaintiff filed this lawsuit in 2008, and much litigation has since
ensued, including an appeal and motion for relief from judgment
pursuant to Civ. R. 60(B). This does not, however, change the
fact that the Court did not have jurisdiction to hear this matter,
nor was Plaintiff Wells Fargo Bank N.A. as Trustee the real party
in interest entitled to enforce the note and mortgage on
February 27th, 2008, the date Plaintiff filed the foreclosure
complaint, or can it be at any point thereafter, without Plaintiff
having first been assigned or otherwise been legally vested as
the true Holder in Due Course of the note & mortgage in
question. Defendant submits that Plaintiff is and was not.
Plaintiff Wells Fargo Bank N.A. as Trustee lacked standing to
bring this action because it was not the holder of the note or the
assignee of the mortgage at the time it filed suit. If a party does
not have standing at the time the complaint is filed, it is a
jurisdictional problem that cannot later be cured.
The question of standing is a threshold question of whether
the party has a personal stake in the outcomeand if that
personal stake does not exist when the lawsuit is filed, the suit
should be dismissed. Plaintiff Wells Fargo Bank N.A. as Trustee
had no legal interest at the time it filed the complaint, and
standing cannot exist without a legal right or claim.
Since the foreclosing bank relied on an after-acquired
interest in the note and mortgage to establish its right to
enforce the agreements, then I Move the Court to vacate the
judgment. I need not proceed under Civ.R. 60(B) because the
judgment is void. The Schwartzwald decision states that
3

standing has to exist at the time the case is filed, and if it

doesnt exist, the jurisdiction of the common pleas court was not
invoked. A court without jurisdiction cannot enter any judgment
(except one dismissing the case for lack of jurisdiction). A
motion to vacate a void (as opposed to a voidable) judgment is
not based on Civ. R. 60(B), it invokes the courts inherent power.
Patton v. Diemer, 35 Ohio St. 3d 68 (1988).
WFB, according to the binding case law in the State of
Ohio and Montgomery County, was not entitled to judgment as a
matter of law because they were not and could never be the real
party in interest. The judgment is void ab initio. Res judicata
cannot be a bar to judgment that is void ab initio.
I.

Relevant Factual Background

1. On February 27th, 2008 (Ex. A) , Plaintif filed the

foreclosure complaint in this action.
2. As of March 6th, 2008 the note & mortgage at issue had
not been assigned from whoever the previous
holder/owner was, to Plaintiff herein.
3. On August 26th, 2008 Plaintiff filed a Notice of
Assignment of Mortgage (which contains therein also an
Assignment of Note) (Exh C), which contained a copy
of a recorded assignment of Defendants note &
mortgage to Plaintiff. (The Assignment, attached
hereto as Exh. B).
4. Plaintiff recorded the Assignment on March 27th, 2008
or 29 days after the foreclosure lawsuit filing.

5. On November 13th, 2008 the Court granted Plaintiffs

judgment and entered a decree of foreclosure against
Defendant.
Defendant has continuously held that Plaintiff in the case
at Bar lacked the capacity to evoke the jurisdiction of the court
in this action;1 hence Plaintiff lacked standing to initiate this
suit.2

II.

Law and Argument

There are more issues with the post dated assignment

than just those addressed in the Schwartzwald Decision.

The POST DATED ASSIGNMENT issue # 1.
As is evidenced in Plaintiffs alleged Assignment from
Option One Mortgage Corp. to The Trust the date of the
transference or Assignment of both the Note & Mortgage did
not occur until after the suit to foreclose had already been filed.
1

August 15, 2008, Memorandum in Opposition to Plaintiffs Motion for Summary Judgment
October 15, 2008, Reply to Complaint
November 21,2008, Motion to Vacate a Void Judgment
December 1, 2008, Memorandum in Opposition to Plaintiffs Memorandum in Opposition to Defendant
John A. Reed's Motion to Vacate
January 16, 2009, Motion for Reconsideration
April 1,2010, Amended Motion to Appeal Ruling of the Lower COUl1
April 30, 2010, Application for Emergency Reconsideration
February 14,2011, Motion to Vacate Judgment Entry
2

Civ.R. 10(D) requires attachment to the pleading of a copy of the written account or any other written
instrument when a claim or defense is founded on those documents.
Fed. Home Loan Mtge. Corp. v. Schwartzwald, 2012-Ohio-5017. (Standing is required to invoke the
jurisdiction of the common pleas court, and it is determined as of the filing of the complaint.)
Wells Fargo v. Burrows, 2012-Ohio-5995 (9th Dist.)(A plaintiff must attach documents evidencing the right
to enforce both the note and the mortgage to the complaint to show standing, or be subject to dismissal.)
HSBC Bank USA, N.A. v. Sherman, 2013-Ohio-4220 (1st Dist.)(Determination of standing should be made
based on attachments to a complaint, but standing in a foreclosure action can be established by showing the
right to enforce either the note or mortgage. Also adopted in the Second, Fifth, Eleventh, and Twelfth
Districts.)
Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (To survive a motion for summary judgment for lack of
standing, a party must set forth by affidavit or other evidence specific facts to support its claim.)

In Federal Home Loan Mortgage Corporation v.

Schwarzwald, et al., a case recently decided by the
Ohio Supreme Court, plaintiff bank brought a
foreclosure lawsuit before it obtained an assignment of
mortgage securing defendant homeowners loan.
Defendants maintained that plaintiff lacked standing to
sue (much as Defendant previously contended in this
case) because the assignment of mortgage had not
been recorded prior to the filing of the lawsuit. Plaintiff
was assigned the mortgage via formal assignment, as
here, only after the filing of the lawsuit. The trial court
entered a judgment in favor of plaintiff, and the Second
District Court of Appeals affirmed.
The Supreme Court reversed, holding that standing
is a jurisdictional requirement that must be satisfied to
even initiate a foreclosure lawsuit:
We recognized that standing is a
jurisdictional requirement in State ex rel.
Dallman v. Franklin Cty. Court of Common Pleas
(1973), 35 Ohio St. 2d 176, and we stated: It is
an elementary concept of law that a party lacks
standing to invoke the jurisdiction of the court
unless he has, in an individual or representative
capacity, some real interest in the subject matter
of the action. (Emphasis added by the Court).
(Schwarzwald, attached hereto as Exh. D at
para. 22).
Further, the Court stated,
Because standing to sue is required to invoke the
jurisdiction of the common pleas court, standing
is to be determined as of the commencement of
suit. Id. At para. 24 Invoking jurisdiction of the
court, thus, depends on the state of things at the
time the action is brought, and not after. Id. At
para. 25.
In reversing the Second District, the Supreme Court included:
6

The lack of standing at the commencement of a

foreclosure action requires dismissal of the
complaint[.]
Id. At para. 40 (Emphasis added).
Hence, in accordance with the ruling of the Supreme
Court of the State of Ohio, when Plaintiff filed this lawsuit on
February 27th 2008, Plaintiff lacked the capacity to invoke the
jurisdiction of the court or in other words, Plaintiff did not have
standing to invoke the jurisdiction of the court because
Plaintiff debt collector had not yet been assigned the mortgage
and note, and for reasons stated in specificity below it could not
then nor can it ever cure this lack of standing through a later
filing of the mortgage assignment as it attempted to do on
March 27th, 2008.
HISTORY as alleged by Plaintif.
Plaintiff brought this action to foreclose on an alleged
mortgage, dated June 9th, 2005, which secured an alleged loan
of $100,000 issued to the Defendant by H&R Block Mortgage
Corporation, a Massachusetts Corporation, (H&RB). On June
9th, 2005, H&RB assigned the note and mortgage to Option One
Mortgage Corporation, (Option One). Option One then alleges
to have assigned the note and mortgage to Plaintiff by
assignment executed March 7th, 2008. Plaintiff is the debt
collector trustee for a securitized trust entitled Securitized
Asset Backed Receivables LLC 2006-OP1 Mortgage PassThrough Certificates, Series 2006 OP1, (the Trust).
HISTORY as alleged by the EVIDENCE

Plaintiff brought this action to foreclose on an alleged

mortgage, dated June 9th, 2005, which secured an alleged loan
of $100,000 issued to the Defendant by H&R Block Mortgage
Corporation, a Massachusetts Corporation, (H&RB).
On June 9th, 2005, H&RB (Entity A) (exhibit **)assigned
all of their rights to the note and mortgage to Option One
Mortgage Corporation (Entity B), (Option One).
Option One then allegedly (there is no assignment
proffered by Plaintiff for this action), through 2 unsigned and
unauthenticated documents,
1. titled Purchase Price and Terms Agreement
(Ex..**) and
2. Titled EXECUTION COPY FLOW AMENDED AND
RESTATED MORTGAGE LOAN PURCHASE AND
WARRANTIES AGREEMENT,
we are lead to believe without proof that Option One does
assign/sells/transfers3 all of their rights to the NOTE &
Mortgage to Barclays Bank (Entity C)(Sponsor) who then
bundles the Note & Mortgage along with approximately 5,000
other like kind investments and uses the entire bundle to create
a new financial instrument called a Special Purpose Vehicle
(SPV), which is designed to be deposited into a REMIC Trust.

As with almost all of Plaintiffs document submissions, the documents Plaintiff submits that are
to be representative of the transfer of the Note & Mortgage from Option One to Barclays Bank
are all unsigned and unauthenticated so no true method of transfer is even represented. BUT, the
controlling Law (IRS & NY. EPTL) both require full sales and transfer of all rights and ownership
before a true securitization of the notes and mortgages into the trust can exist and the Trusts
controlling document, the PSA also mandates a complete evidentiary trail of all transfers and/or
assignments of both the note and mortgage before being allowed to be deposited into the trust.

Barclays Bank (Entity C) then, we are lead to belive, sells4

(without a physical assignment, transfer, proof of negotiation,
etc.) and transfers all of their rights to the contents of the SPV
containing Defendants alleged Note & Mortgage to the
securitized trusts Depositor,5 Securitized Asset Backed
Receivables LLC(Entity D) (SABR) who then deposits and
transfers all of their rights the notes and mortgages in the SPV6
to the Trust (Entity E).

Option One (Entity B) then alleges to have assigned the

note and mortgage to Plaintiff (Entity E) by assignment
executed March 7th, 2008.
Plaintiff is the debt collector trustee for a securitized trust
entitled Securitized Asset Backed Receivables LLC 2006-OP1
Mortgage Pass-Through Certificates, Series 2006 OP1, (the
Trust).
ARGUMENT
The lack of proper transfers (A B, B C, C D and D E)
and in fact, improper transfers ( as in the case at Bar where
Plaintiffs Assignment expresses transfer from Entity B to E), to
others creates a series of document defects and deficiencies
that include, but are not limited to the following:
a) Broken endorsement chains (A B, B C, D E);
b) Original Notes without signatures on endorsements;
c) Notes with skipping endorsements;
4

Same as Footnote 3 above no signed or authenticated contract.

Same as Footnote 3 above no signed or authenticated contract.
6
Same as Footnote 3 above no signed or authenticated contract.
7
It is important here to note that in each transaction listed above, Plaintiff also produces no
receipts, no delivery acceptance, nothing whatsoever to show proof of conveyance or transfer or
negotiation or sale of, in the end, an alleged $5 Billion worth of financial instruments from any
party to any other party whatsoever.
5

d) Notes with endorsements on unattached allonges;

e) Allonges unattached to their original wet-ink notes;
f) Allonges copies and taken from other notes and placed
onto a different note ;
g) Allonges unattached to original notes with blank
endorsements;
h) Notes never endorsed;
i) Allonges never dated;
j) Allonges in blank and pre-executed and undated for
later fill-ins by unknown parties;
k) Double pledges of the same note and/or loan to
different parties;
l) Post-dated assignments of mortgages and notes;
m) Robo-signed assignments of mortgages and notes;
n) Post-dated assignments of mortgages and notes;
o) Assignments executed with no lawful authority;
p) Assignors assigning to themselves;
q) Two different parties claiming the ownership of the
same note/loan.
In the case at Bar, it is the Trustee for the Trust that is
bringing the foreclosure suit. Plaintiff Trustee offers no proof of
any transfer of any ownership, or rights or authority from the
Trust to the Trustee of/or pertaining to the Note and/or the
Mortgage.
Within the PSA at section 3.15 we also find that by
contractual agreement it is not the Trustees position to engage
in any foreclosing activities, it is instead the Servicers
obligation. Setion 3.15 reads:

10

Section 3.15 Realization upon Defaulted Mortgage Loans. The Servicer shall use
its best efforts, consistent with Accepted Servicing Practices, to foreclose upon or
otherwise comparably convert (which may include an acquisition of REO Property) the
ownership of properties securing such of the Mortgage Loans as come into and continue
in default emphasis mine

Again, lacking a proper Assignment of the Note and/or

mortgage that is the subject of this action, and lacking any
authority given by the trusts governing document, the PSA,
Plaintiff Trustee lacked the capacity to invoke the jurisdiction
of this court therefore Plaintiff lacked standing to initiate suit.
Standing is a threshold issue. Without standing to invoke,
no further mutterings or protestations of the Plaintiff can be
heard for they are moot.
THE TRUST
The Trust was formed as a vehicle for purchasing
mortgage backed securities. The Trust is subject to the terms of
the trust indenture (controlling document) memorialized in a
document titled the Pooling and Servicing Agreement, (the
PSA). The PSA was signed by the Depositor, Securitized Asset
Backed Receivables LLC (SABR), by the Servicer, Option One,
and by the Trustee, WELLS FARGO BANK, NA, and is dated
January 1, 2006.
The PSA sets forth the manner in which mortgages would
be purchased by the trust, as well as the duties of the trustee
and the servicer. It is the trusts own controlling document.
Section 2.01, subsection 1 of the PSA requires that
transfer and assignment of mortgages must be effected by hand
delivery, for deposit with the Trustee with the original note
endorsed in blank.

11

Section 2.05 of the PSA requires that the Depositor

transfer all right, title, interest in the mortgages to the Trustee,
on behalf of the trust, as of the Closing Date. The Closing
Date as provided in the PSA is January 26th, 2006.
The Date of the Assignment of Mortgage (and Note)
referenced infra, is over 2 years past the date allowed for
deposits into the trust. If the trust does not perfect legal title by
taking physical possession of the notes and mortgages, the
Internal Revenue Code, specifically 26 U.S.C. 860G(d)(1),
provides for a 100 percent tax penalty on those non-complying
cash flows.
As listed in the PSA, the Depositor in the case at Bar was
Securitized Asset Backed Receivables LLC ("SABR"). Within
the schema of a securitized MBS trust, the Depositor is the
necessary entity in the title chain that provides the Bankruptcy
remoteness necessary to the Notes and the Mortgages
deposited into the trust, so that the trust can gain a AAA rating
with the securities ratings agencies and to comply with IRS rule
860

The Depositor is also the designated sole depositor to the

trust.
In the case at Bar, Plaintiff shows not 1 iota of proof that
said Sponsor, Barclays Bank (Entity C), ever received
Defendants Note and/or Mortgage.
In the case at Bar, Plaintiff shows not 1 iota of proof that
said Depositor (Entity D) ever received Defendants Note and/or
Mortgage OR the alleged and previously allegedly created SPV
(from Sponsor Barclays Bank) containing Defendants alleged
Note and/or Mortgage.
12

In the case at Bar, Plaintiff shows not 1 iota of proof that

said Depositor (SABR) ever deposited the alleged Mortgage and
Note into the Plaintiff Trust.
In the case at Bar, Plaintiff shows not 1 iota of proof that
said Plaintiff Trust ever transferred the alleged Mortgage and
Note to the Plaintiff Trusts Trustee, Wells Fargo Bank N.A. who
is the Plaintiff in this case.
But it is essential for the courts to understand that before
the alleged note & mortgage could be placed within any REMIC
trust, each of these steps was mandated by N.Y. E.P.T.L, I.R.C.
requirements AND by the contractual terms found within the
PSA which was signed and agreed upon by the participants of
the securitization. The rules for the deposit of all of the Notes &
Mortgages allegedly held within the pool of assets owned by the
trust are strict and are mandated to be adhered to punctiliously.
As stated in the NYSBA NY Business Law Journal |
Summer 2012 |Vol. 16 |No. 1 pg. 77;
The Mortgage Securitization Transaction In 1986, Congress changed the tax
code. One of these changes was the creation of the Real Estate Mortgage
Investment Conduit (REMIC). A REMIC or special purpose vehicle (SPV) is an
entity that is created for the specific purpose of being a tax-free pass-through
for interest income generated by pooled mortgages. This allowed investors to
purchase shares or certificates in a mortgage pool that was only taxed once at
the investor level. The REMIC rules allowed the mortgage pools to collect
interest income from the pool and disburse that income to the certificate holders
tax-free at the pool level. Prior to the REMIC, interest income from pooled
mortgage investments were taxed twice, once at the pool level and again at the
investor level.

13

REMIC rules are very specific,8 and to qualify as a REMIC under federal and
state tax codes, the SPV had to meet very stringent requirements. With respect
to RMBS the controlling trust document is known as the Pooling and Servicing
Agreement (PSA). One function of the PSA is to establish the rules governing
the trust such that the trusts activities and management conform to IRC 860. If
the trust did not conform, it could lose its REMIC status and its tax-free passthrough status.9
NYSBA NY Business Law Journal |Summer 2012 |Vol. 16 |No. 1 pg. 77

The Trusts agreement (known as the Pooling and

Servicing Agreement (PSA)), the trusts indenture10, sets forth
in its entirety how the trust acquires and is allowed to acquire
its assets and the Trust agreement sets forth both powers and
the limits of the powers of the Trust.
The PSA11 requires that each party to the sale of the
mortgage loans endorse each promissory note to the next party
in the chain of title until the promissory note is endorsed to the
Trustee for the benefit of the Trust. This requirement is
included in the PSA and is found at Section 2.10.
According to the requirements set forth in the Trust
Agreement (PSA) there must be a series of endorsements of the
promissory note reflective of each party who had an ownership

IRC 860 requires that, among other things, the REMIC trust be a closed entity and bankruptcy remote.
New Yorks Estate Powers & Trust laws were chosen by RMBS sponsors (in the PSAs) as the controlling
statutes to govern REMIC trusts, as the EPTLs rules and concomitant common law establish common law
trusts that conform the REMIC tax free pass-through requirements. NYSBA NY Business Law Journal |
Summer 2012 |Vol. 16 |No. 1 end note 7
9

If a tax-free pass-through trust lost its REMIC status, the tax penalties to an investor that purchased
certificates would be devastating. It would also trigger an event called a put back. There was considerable
argument over whether these trusts were business trusts or common law trusts, but the trend appears to be a
judicial recognition that they are in fact common law trusts. NYSBA NY Business Law Journal |Summer
2012 |Vol. 16 |No. 1 end note 8
10

Blacks 9th. trust indenture. 1. A document containing the terms and conditions governing a
trustee's conduct and the trust beneficiaries' rights. - Also termed indenture of trust. [Cases: Trusts
C=> 19-29.] 2. See deed of trust under DEED.
11
The Trusts Pooling and Servicing Agreement is a Public Document available here
http://www.secinfo.com/dRSm6.v8h.d.htm

14

interest in the promissory note culminating with a blank

endorsement from the depositor at the very minimum.
This chain of endorsements, or rather the lack thereof, in
order to comply with this Trusts PSA, would have had to be
complete on or before the closing date of the trust specified
within the PSA of this securitization but in no event more than
90 days from the closing date of the trust pursuant to section
2.02(a) of the PSA. The absence of these endorsements on this
promissory note is not only very compelling proof of lack of note
holder status, but also proof of Plaintiffs fraud in the production
of the Assignment of Mortgage (Exhibit E) which by the terms
of the trusts own governing document (PSA) cannot and does
not legally exist.
Under either the terms of the trust, the contracts between
the parties, or UCC 9 in the case at Bar, there are unmet
requirements for the chain of title by the foreclosing entity to be
qualified as a PETE (person entitled to enforce). In other
words, single endorsements in blank, and claiming that any
party in possession of a note, can enforce a note, even a thief,
does not work.
The evidence in the collateral file shows an utter and
complete failure of the parties to this alleged securitization to
actually convey this alleged promissory note to this Trust as was
articulated by the Defendant in each and every previous
pleading. The plaintiff Trust has offered no proof of ownership
and the collateral file proffered by the Plaintiff through
Discovery clearly demonstrates that this loan was not
securitized nor was it ever transferred to this Trust.
15

The Court should also be aware that Sections 2.07 d., e.,
h., 3.01 c., 3.17 (h), 5.02, c, 8.11 of the PSA are all specific to
the case at bar which set forth further explicit restrictions on
the powers of the Trustee, Depositor and the Servicer of the
trust and which prohibits the Trustee, Depositor and the
Servicer from taking any action which would jeopardize the
REMIC status of the Trust. The production of the post dated,
forged and fabricated Assignment of Mortgage is itself a
prohibited action. These types of limitations are common and
are present in this or a similar form in every pooling and
servicing agreement which seeks to create a securitized trust
that can claim the tax benefits of REMIC status under the US
Tax Code.
Any attempt to accept a transfer of this alleged
Promissory note after the January 26, 2006, 90 day closing date
of the trust would have violated both SEC code 424 & 1122 and
the REMIC provisions of the IRS tax code 26 USC 860 A thru F -for
a number of reasons.
a. First, the alleged loan is in default at this time.
Therefore the alleged loan cannot be a qualified
mortgage loan under the IRS tax code because a
qualified mortgage loan is a performing mortgage loan.
b. Second, an attempted transfer to the trust is now at
a point in time after the closing day of the Trust and
after the certificates were issued, in effect, the Plaintiff
would be claiming to have transferred an asset to a
trust that had by its own terms been closed for more
than 2 years at the time the alleged transfer took place.
16

c. Third, the alleged promissory note was never

endorsed to the trust by the depositor and as such is
devoid of the required chain of endorsements required
within the PSA and which any reasonable market
participant would expect to be present for the
purposes of establishing the series of true sales set
forth in the PSA to establish a whole and complete
chain of title of the promissory note for the purposes of
bankruptcy remoteness.
d. Fourth, The claim that the alleged note has been
transferred to the Trust when it is endorsed in blank
simply flies in the face of the mandatory terms of the
PSA and is an extreme deviation from the industry
standards, customs and practices which prevailed at all
times material to this transaction and which prevail
today.
e. Fifth, any transfer allowed to be accepted into the
trust past the trusts own cut-off date of deposits
invokes the rather draconian IRS mandate of taxing the
REMIC trusts assets not at the favorable rate of 0%
that they now enjoy, but at the rate of 100% of the
value of their assets causing, massive financial losses
to the Certificate Holder Investors.
Equally, by allowing a Deposit into the trust after the
trusts closing date as Plaintiffs Assignment of Mortgage
alleges, Plaintiff Wells Fargo Bank as Trustee again violates the
plain language found within the PSA at section 8.11 titled Tax
Matters section (j) para. 6 which reads in part;

17

Neither the Servicer nor Trustee shall (i) permit the creation of any interests
in any Trust REMIC other than the regular and residual interests set forth in
the Preliminary Statement, or (iii) otherwise knowingly or
intentionally take any action, cause the Trust Fund to take any action or fail to
take (or fail to cause to be taken)any action reasonably within its control and
the scope of duties more specifically set forth herein, that, under the REMIC
Provisions, if taken or not taken, as the case may be, could (A) endanger the
status of any Trust REMIC as a REMIC or (B) result in the imposition of a
tax upon any Trust REMIC or the Trust Fund (including but not limited to the
tax on "prohibited transactions" as defined in Section 860F(a)(2) of the Code
and the tax on contributions to a Trust REMIC set forth in Section 860G(d) of
the Code, or the tax on "net income from foreclosure property") unless the
Trustee receives an Opinion of Counsel (at the expense of the party seeking to
take such action or, if such party fails to pay such expense, and the Trustee
determines that taking such action is in the best interest of the Trust Fund and
the Certificateholders, at the expense of the Trust Fund, but in no event at the
expense of the Trustee) to the effect that the contemplated action will not,
with respect to the Trust Fund or any Trust REMIC created hereunder,
endanger such status or, unless the Trustee determines in its sole discretion to
indemnify the Trust Fund against such tax, result in the imposition of such a
tax).

To Summarize, (The closing date of this trust was January

26, 2006. The creation date of Plaintiffs Assignment of
Mortgage is March 7, 2008 or 25+ Months past the trusts
closing date) and as such is in violation of the trusts own
controlling document, the Pooling and Servicing Agreement
(PSA), I.R.C. regulations and the trusts controlling law, N.Y.
E.P.T.L. Plaintiffs and Plaintiffs counsel clearly show scienter
by having acted in contravention to the trust by;
1. creating or manufacturing, (forgery with intent to
defraud)
2. attempting the use of (distribution) and (intent to
fraud)
3. actually submitting (selling) false, forged and
fraudulent documents within this very Court of Law
and Equity, evidenced not only by their late creation
date as it concerns legal standing to invoke the
18

jurisdiction of the Court, but also in contravention of

IRS REMIC Law as explained above and again within
the PSA at Section 8.11 Tax Matters (g) which reads;
(g) not knowingly or intentionally take any action or
omit to take any action that would cause the
termination of the REMIC status of any Trust
REMIC created hereunder;
4. Making false statements to the Court

One can only give/assign and/or transfer what one has to

give/assign and/or transfer. Only the legitimate rights of the
transferor can be transferred to the transferee.
There is no trust if the trust fails to acquire the property.
Kermani v. Liberty Mut. Ins. Co., 4 A.D. 2d 603 (N.Y. App.
Div. sa Depart. 1957).
In so doing the above, in violation of the law, codes, rules
& regulations articulated above, Plaintiff also acted in violation
of the Fair Debt Collection Practices Act. The allegations above
are re-alleged and incorporated herein by reference.
Defendant John A. Reed incorporates by reference all of
the proceeding and foregoing allegations in the entirety of
Defendants answers & pleadings as in regard to the Complaint
in its entirety and from its inception.

19

The POST DATED ASSIGNMENT 2

As is referred to above, Plaintiffs Assignment of
Mortgage (and Note) was created on March 7th, 2008. The
Plaintiff Trust, by virtue of its REMIC status has what is called
a Cut-Off date. The Trusts cut-Off date is the date in which
the Trust is mandated by law to stop accepting deposits into it.
Aside from the creation post foreclosure issue related above, by
the terms of the Trusts own PSA, N.Y. E.P.T.L. & I.R.C.
regulations all mandate that this Assignment was void at its
inception.
Plaintiff debt collector in this case is a Trustee for a
Mortgage Backed Securitized Trust and as such Plaintiff Trustee
and the Trust are controlled in their entirety by the Trust
Indenture or controlling document, a document titled the
Pooling & Servicing Agreement (PSA).
The Trust is also a Real Estate Mortgage Investment
Conduit (REMIC) trust and as such is held in strict regulations
with both I.R.S. REMIC trust rules of Law and the Laws and
Rules created specifically in accordance with the Trust laws of
either the State of the Trusts creation or by the contractual
choice of the participants of the Trust, as is the case at bar. The
agreed contractual choice of Law to be adhered to by the
Trusts participants in the case at Bar is New York Trust Law
E.P.T.L..
Plaintiffs production of the Assignment is contrary to
New York Law and IRS 860. In short, the Plaintiff Trust
exercised a prohibited act on March 7th, 2008.
20

The aforementioned Assignment is contrary to the

Trusts Instruments and therefore Void pursuant to IRS 860A-G
and New York Estates, Powers & Trusts (E.P.T.L) - Part 2 - 7
2.4 and the Trusts Indenture requirements.
"Any action which deviates from the Trust documents is void. 7-2.4 Act of
trustee in contravention of trust If the trust is expressed in the instrument creating
the estate of the trustee, every sale, conveyance or other act of the trustee in
contravention of the trust, except as authorized by this article and by any other
provision of law, is void".

No possession of the Asset exists until there has been a

delivery and an acceptance of the Asset and the giver of the
Asset has relinquished all dominion and control over the Asset
signifying a true sale of the Asset to the Plaintiff Trust thereby
making the Asset, inter alia, bankruptcy remote and securely
within the Trust Vault.
Plaintiffs proffered Assignment in the case at Bar
proves only that it was a forged and fabricated document
created solely for the purpose of facilitating the easy theft of
Defendants home within a Court of Law.
The Trust is a REMIC Trust
The Trust was formed as a REMIC trust.12 Under the
REMIC provisions of the Internal Revenue Code (IRC) the
closing date of the Trust is also the startup day for the Trust.
12

The Internal Revenue Code provides that the terms real estate mortgage investment
conduit and REMIC mean any entity(1) to which an election to be treated as a REMIC applies
for the taxable year and all prior taxable years, (2) all of the interests in which are regular interests
or residual interests, (3) which has 1 (and only 1) class of residual interests (and all distributions, if
any, with respect to such interests are pro rata), (4) as of the close of the 3rd month beginning after
the startup day and at all times thereafter, substantially all of the assets of which consist of
qualified mortgages and permitted investments.

21

The closing date/startup day is significant because all assets of

the Trust are mandated to be transferred to the Trust on or
before the closing date to ensure that the Trust received its
REMIC status. The IRC provides in pertinent part that:
Except as provided in section 860G(d)(2), if any amount is contributed to
a REMIC after the startup day, there is hereby imposed a tax for the taxable year
of the REMIC in which the contribution is received equal to 100 percent of the
amount of such contribution.
26 U.S.C. 860G(d)(1).

The assignment of the note and the mortgage which

alleges the transfer of the Note & Mortgage in this case was
dated March 7th, 2008, however, pursuant to the terms of the
PSA the trust closed on January 1st, 2006. Acceptance of the
alleged Note & Mortgage into Plaintiff Trust at the date shown
on Plaintiffs Assignment is in violation of IRC 860G(d)(2) and as
such is mandated to be declared VOID by the terms found within
the PSA and by N.Y. E.P.T.L. & I.R.C. regulations.
THE POST DATED ASIGNMENT 2
In the case at bar, Wells Fargo Bank, N.A, as Trustee of the
Trust, claims to be the sole and exclusive owner of the
securitized note & mortgage. If Wells, as Trustee for the
Trust is in fact the true and legal owner, it must have acquired
legal title to the loan within 90 days of January 1, 2006 (the
trusts closing date).
For clarification of the above; New York law states that
transfers to a REMIC trust after the closing date of the trust are
void. N.Y. Estates, Powers and Trusts Law 7-1.18, 7-2.4.
Glaski v. Bank of America, N.A., 218 Cal.Rptr.4th 1079
22

(2013). See also, Saldivar v. JPMorgan Chase, 2013 WL

2452699 (Bky. SD Tex. 6/5/13) (holding that trustee mortgagees
position is void if notes and assignments of mortgage not
delivered within 90 day of closing of trust); Wells Fargo v.
Erobobo, 2013 WL 1831799 (NY Slip Op. 4/29/13) (holding that
NY trust law governs securitization (not Ohio law) and that
notes and assignments of mortgage must be physically delivered
to trustee within 90 days of closing for trustee to have claim of
ownership). The Internal Revenue Code provides for 100
percent tax penalties for asset transfers to the trust after the
closing date of the trust and the Trusts controlling document,
the PSA, specifically Section 9.02, forbids all participants in the
securitization of the assets of the trust to perform any action in
contravention to the IRS code.
Further, Section 9.02 of the PSA specifically prohibits the
acquisition of any asset for a REMIC fund after the closing date
unless the party permitting the acquisition and the NIMS (net
interest margin securities) Insurer have received an Opinion
letter from counsel, at the party's expense, that the acceptance
of the asset will not affect the REMIC's status.
Plaintiff offers no such evidence or proof that a letter has
been provided to show compliance with the requirements of the
PSA. Plaintiff has provided no evidence of Depositors depositing
of the note and mortgage into the Trust and has provided no
evidence that the trustee had authority to acquire the note and
mortgage herein after the trust had closed or for the purpose of
foreclosure.

23

Defendant asserts that the alleged transfer of the note &

mortgage to Plaintiff Trust herein is void because the note is
represented to have been acquired after the trusts closing date
and as such is a violation of the contractual terms of the Trusts
controlling document, the PSA.
Whereas in Ohio Law it may be permissible for a Holder
to execute suit on a note and/or mortgage, in the case at Bar the
alleged contraction between parties is not being done by an
Ohioan against an Ohioan! Instead it is being committed by a
debt collector who is an alleged representative of a NY Trust
which is bound by NY Laws and as such it is up to Plaintiff to
prove he is indeed the true PETE (Person Entitled To Enforce) of
the alleged Note & Mortgage.
In the case at Bar Plaintiff offers only 3 signed documents,
just 3 pieces of paper attesting to their legitimacy to foreclose,
their right to be PETE. Those documents are:
1.

the post dated, post created and filed with the

court months after foreclosure initiation,
Assignment of Mortgage which is Robo-Signed
by a Ms. Topaka Love.

2.

The post dated, post created and filed with the

court months after foreclosure initiation, Affidavit
of Status of Account and Military Status again
signed by the same Robo-Signer Ms. Topaka Love

3.

The Allonge from Option One Mort. Corp. to

blank.

Defendant submits new evidence in this case in the form

of an Affidavit attesting to the Robo-signing (explained infra) of
24

both Plaintiffs Assignment of Mortgage and Plaintiffs

Affidavit of Status of Account and Military Status.
THE ALLONGE
On or about June 9, 2005, as the evidence of record shows
Mr. Reed's alleged original lender, H&R Block Mortgage Corp.,
claims that through the use of an alleged executed endorsement
which was unattached, incomplete, non-authenticated by
affidavit, unexecuted Pay to the Order(as in existing distinctly
separate under law from bearer paper), allonge dated June 9,
2005 from Option One to blank.13
13

Comments Of Nye Lavalle To Florida Supreme Court Page 52

Nye Lavalle, Pew Mortgage Institute, 407/968-9097 mortgagefrauds@aol.com
243. In fact, a common industry practice was to create an unattached and an undated endorsed in blank
piece of paper the industry wrongly inferred was an allonge! 244. The unattached piece of paper with an
executed endorsement upon its face would then be placed in a file with or without a note, scanned and
imaged into an imaging system and then discarded, destroyed, concealed, or even later attached if necessary,
upon default by a borrower when a servicer needed to create evidence of note ownership or holder status.
245. Under UCC Article 3, indorsement means a signature on an instrument, not on a blank piece of
paper. 246. In order for the endorsement on an allonge to be valid, the proper document custody process that
should have been followed was to: a) determine if room existed on the last page of the note or its backside to
see if any room existed for the endorsement; b) only if no room existed, a blank piece of paper should be
firmly affixed to the last page of the original wet-ink note, so as to prevent its removal and replacement; c)
the first page on the face of the note should then be stamped Allonge property address, loan number etc.
should be placed upon the blank piece of paper; and then e) the endorsement stamp and signature should be
placed on the affixed piece of paper to the note (i.e. an allonge). 247. An unattached to an original note blank
piece of paper is not an allonge. An unattached to an original note blank piece of paper with an endorsement
on its face is not an allonge either. If the endorsement is placed upon the blank piece of paper and then the
endorsement and signature are placed on the blank piece of paper while unattached, all someone has endorsed
was the blank piece of paper, not the original note itself. 248. Darrell W. Pierce is a Michigan lawyer for the
national law firm of Dykema Gossett. Mr. Pierce served as member of the Article 9 Study Committee for the
Permanent Editorial Board for the Uniform Commercial Code, as Chair of the Article 9 Filing Project and as
the primary drafter of the International Association of Commercial Administrators Model Administrative
Rules for Article 9 filing offices. He is a frequent lecturer and writer regarding UCC matters. 249. Mr.
Pierce authored an article for the Association of Corporate Counsel titled Allonges: Separate Indorsements
Not Effective Unless Affixed. In this article, Mr. Pierce exposes the lenders dirty secret of the motives
and use of allonges by the mortgage industry when he writes:
Secured lenders routinely take pledges of instruments (including negotiable instruments under UCC
Article 3 and other promissory notes) as collateral. Instruments are subject to special priority rules.
Security interests perfected merely by filing a UCC1 financing statement are junior to security interests
perfected by possession, without regard to time of filing or possession.
Security interests perfected by control (possession plus indorsement) are senior to those perfected
merely by filing or possession. Accordingly, secured parties who are relying on instruments as collateral
will want to have control over the instruments.
Instruments may be indorsed to secured parties, but it is a cumbersome process that has to be
unwound when the loan is repaid as expected. It is, therefore, convenient and common practice
to have the requisite indorsements supplied on a separate piece of paper. This keeps the instrument
clean so that it can be returned clean when the secured obligations are paid. The separate piece of
paper is kept with the instrument but is not typically attached to it, though the lender or its custodian
has authority to do so, at least upon default.
This practice works well in most cases. Even though the lender is not yet a holder under Article 3,

25

It is Defendants position that the proffered Allonge from

Option One Mort. Co. to blank is a fraud and a shame created
solely to represent to this Court Plaintiffs interest in the Note &
Mortgage which in truth has no legal value whatsoever except
to prove Plaintiffs and Plaintiffs Counsels willingness to create
and bring into this court fraudulent documents created solely to
influence the Courts bias.
The Wells Fargo Manual
Defendant submits new and previously unobtainable
evidence in this case of Plaintiff Wells Fargo Banks recently
published in house manual titled Wells Fargo Home
because the indorsement is not attached, the lender has possession and the related loan documents
should cause the lender to be a nonholder in possession of the instrument who has the rights of a
holder, that is one who can enforce the instrument as such under UCC 3-301 , and compel
indorsement under UCC 3-203.
In addition, secured parties in (mere) possession have priority over other secured parties except
those who have control (possession plus indorsement), so the failure to achieve full control does not
normally impair priority (no one else will have possession except in rare cases). UCC 9-330(d).
So, even if a separate indorsement is not initially affixed to an instrument, a secured party
inAttached; d) identifying information on the note such as origination date, borrower name,
possession normally maintains first priority and has the power to negotiate the instrument upon
default.
There are occasions, however, when having an indorsement is critically important. One would be
the relatively rare case where one competing secured party has possession for itself as well as for the
other competing secured party, so both would be in possession and priority could depend on the
effectiveness of an indorsement. Another would be where the maker of a negotiable instrument has
defenses against the named payee but the secured party, with the indorsement, would be a holder in due
course. Yet another would be an assignment of a note or a casual pledge where the related documents do
not clearly provide the lender with the rights of a holder.
Under UCC Article 3, which applies to negotiable instruments (as defined in Article 3) and which
is commonly applied by courts to non-negotiable instruments, indorsement means a signature on
an instrument For the purpose of determining whether a signature is made on an instrument, a
paper affixed to the instrument is a part of the instrument. UCC 3-204(a) (emphasis supplied).
Under this rule, a separate assignment document is not sufficient to create the requisite
indorsement, unless it is affixed to the instrument.
Some Michigan assignees found out the hard way how important it is to have ones separate
indorsement affixed. In one case, a separate indorsement was not attached to the note in question and
the assignee was unwilling to produce the underlying assignment of loans agreement. The court held the
separate indorsement was not effective and, because it referenced the unproduced underlying agreement,
it did not prove an absolute assignment was intended. Brown Bark, II, LP v. Bay Are Floor Covering &
Design, Inc., Case No. 296660, (Mich. Ct. App. May 31, 2011). In the other case, the assignee ultimately
had two problems after it took a note and placed it in an envelope with a separate indorsement. Not only
was the separate indorsement ineffective because it was not affixed to the note, it turned out the note
was in fact a color copy of the original note, so the assignee did not even have possession of the note.
Without ever having had possession, the assignee did have standing to enforce the note as a lost note
under UCC 3-309. Shaya v. Karam, Case No. 308905 (Mich. Ct. App. May 6, 2014). Pledgees and
other assignees of notes need to ensure that original notes are delivered to them, and if indorsements are
separately provided, that transaction documents properly authorize them to attach the separate
indorsements when appropriate.

26

Mortgage Foreclosure Attorney Procedure Manual,

Version 1 proving scienter through a pattern and practice of
Plaintiffs and Plaintiffs Counsel in the creation of fraudulent
documents created solely to allow Plaintiff and Plaintiffs
Counsel to fraudulently take homes from homeowners when
they lacked the right because they lacked the proof to
accomplish it legally.
A distinguished colleague, New York bankruptcy attorney
Linda Tirelli has been working in exposing these remediation
practices. Their ta-da Perry Mason-like moments of evidence
all of a sudden appearing in foreclosure and bankruptcy
litigation are not amusing. On March 12, 2014, the New York
Post published a story on Ms. Terellis work wherein it wrote:
Wells Fargo, the nations biggest mortgage servicer, appears to have set
up detailed internal procedures to fabricate foreclosure papers on
demand, according to allegations in papers filed Tuesday in a New York federal
court. In a filing in New Yorks Southern District in White Plains for a local
homeowner in bankruptcy, attorney Linda Tirelli described a 150-page Wells
Fargo Foreclosure Attorney Procedures Manual created November 9,
2011 and updated February 24, 2012. According to court papers, the Manual
details a procedure for processing [mortgage] notes without
endorsements and obtaining endorsements and allonges.

The Wells Fargos manual Ms. Terilli speaks of is even

more disconcerting when you review just a few of the steps in
its numerous processes as reflected below:
Attorney: If an allonge is still needed after a note has
been endorsed, forward the allonge attachment to Wells
Fargo Default Docs area via email address
Defaultallongemailbox@wellsfargo.com and add step Y44,
ATTORNEY REQUESTED ALLONGE, to FOR3
WFHM Default Docs Team: If property is located in an
original doc state and attorney has the original note, review
the allonge attachment to determine if we have signing
authority to execute internally.

27

 If WFHM does have signing authority, enter log code

FCALGI (ALLONGE SENT FOR INTERNAL SIGNATURE)
If WFHM does not have signing authority, enter log code
FCALGE (ALLONGE SENT OUT FOR EXECUTION) and mail
document for 3rd party signature.
After allonge has been executed, enter log code FCALGA
(ALLONGE COMPLETED/RETURNED TO ATTORNEY).
Complete the Y44 actual date with the date allonge was
returned to attorney.

The Wells Fargo manual may be reviewed and downloaded

at
http://stopforeclosurefraud.com/wpcontent/uploads/2014/03/for
eclosure_attorney_procedure_manual-1.pdf and is attached as
Exhibit F-1
This manual, is the foundation for the strong rebuke of
Wells Fargo in recent 30- page opinion (attached as Exhibit G) of
Federal Bankruptcy Judge Robert Drain in New Yorks Southern
District wherein in his opinion, Judge Drain stated:
[T]he blank indorsement, upon which Wells Fargo is
relying, was forged, Nevertheless it does show a general
willingness and practice on Wells Fargos part to create
documentary evidence, after the-fact, when enforcing its
claims, WHICH IS EXTRAORDINARY,
wrote Judge Drain with emphasis.
This was on the heels of another major defeat for Wells
Fargo wherein a family who had actually paid off their mortgage
was unlawfully foreclosed on by Wells Fargo and the Judge
awarded over $3 million in punitive and compensatory damages
by Judge R. Brent Elliott of Missouris 43rd Judicial Circuit.

In this Missouri case, the automated robotic foreclosure,

evidence and witness process was in perfect focus for this
28

Honorable Court to understand when the corporate witness for

Wells Fargo testified that:
Im not here as a human being. Im here as a
representative of Wells Fargo.
In his opinion attached as Exhibit H, Judge Elliott
chastised Wells Fargo for their outrageous and reprehensible
decisions and deceptive and intentional conduct that
displayed a complete and total disregard for the rights of the
borrowers. He went on to state:
Defendant Wells Fargo operated from a position of
superiority provided by its enormous wealth. Wells
Fargos decision took advantage of an obviously financially
vulnerable family,
the judge continued, noting that Wells Fargo showed no
evidence of remorse for the harm caused.
In fact, the Court recalls the lack of remorse and
humanity illustrated by a Wells Fargo corporate
representative who testified, Im not here as a
human being. Im here as a representative of Wells
Fargo,
the judge wrote.
The ROBO-SIGNED DOCs.
When Plaintiff, several months after initiating foreclosure,
introduced into the court record a forged and fabricated, back
dated and Robo-Signed14 document titled Assignment of
14

we now have a legal definition of "Robo-signer" from the U.S.C.O.A. for the 5th Circuit (TX) in
the case of REINAGEL v. DEUTSCHE BANK NATIONAL TRUST COMPANY, No. 12-50569
(5th Cir. Oct. 29, 2013). The court defined "Robo-signing" as follows;
"Robosigning is the colloquial term the media, politicians, and consumer advocates have used to
describe an array of questionable practices banks deployed to perfect their right to foreclose in the
wake of the subprime mortgage crisis, practices that included having bank employees or third-party
contractors: (1) execute and acknowledge transfer documents in large quantities within a short
period of time, often without the purported assignors authorization and outside of the presence of

29

Mortgage, Plaintiffs Counsel certified the legitimacy of a

document that could, by the very terms within the controlling
document of the Trust (PSA) itself, never possibly exist.
This document is titled Assignment of Mortgage. Upon
inspection though, this document is in reality not only the
alleged assignment of the alleged mortgage but also the alleged
assignment of the alleged note.
Also upon inspection it can be found that this document
was attested to and signed by one Ms. Topaka Love. Ms. Love is
an employee of Lender Processing Services in Dakota County,
Minnesota and as such the AOM was also fraudulently signed by
a person who had no authority to sign. It is patently fraudulent
and is an obvious forgery and as explained infra it was executed
two years after the Plaintiff trusts mandated Cut-Off date for
deposits.
Mortgages may be enforced only by, or on behalf of, the
entity that is entitled to enforce the obligation the mortgage
secures. The underlying obligation in all cases is a promissory
note. The mortgage is the security instrument that secures the
indebtedness created by the note to the real property.
The practice of Plaintiff Wells Fargo Banks use of
unauthorized document forgers in Affidavit & Assignment of
Mortgage creation is now common knowledge (it was even on
60 Minutes!). It is a matter that has even been unaffectionately

the notary certifying the acknowledgment, and (2) swear out affidavits confirming the existence of
missing pieces of loan documentation, without personal knowledge and often outside of the
presence of the notary."

30

termed Robo-Signing15

16

AND now through common

knowledge of Plaintiff Wells Fargo Banks Public admissions

(and payment of $ Billions in fines concerning same) of
participation in the that very same illegal action on a daily,
monthly and yearly basis, Defendant submits and requests the
Courts Judicial Notice of the recently and previously
unavailable Affidavit and accompanying letter attached hereto
as Exhibit F stating in part;
In an attempt to provide you with more assistance, I have enclosed, an affidavit
signed by me, as Register of the Southern Essex District Registry of Deeds,
attesting to the presence of a robo-signed signature on your document as listed
on McDonnell Property Ana1ytics Approved Robo-signers List. If you are
currently being foreclosed upon, this affidavit may be presented to your attorney,
the lender, or the court to show that your chain of title has been corrupted.

The above referenced Affidavit attests to the unlawful and

known Robo-Signer signature status of Plaintiffs Assignment
of Mortgage (Ex E) as well as signature status of Plaintiffs
sole proffered and alleged legal conclusory Affidavit titled
STATUS OF ACCOUNT AND MILITARY STATUS AFFIDAVIT
(Ex. F) which are both signed by one Ms. Topaka Love, as was
previously articulated to this Court by Defendant in all of
Defendants previous pleadings. The above mentioned forged,
fraudulent and conclusory Affidavit and Assignment of
Mortgage are the solely signed documents Plaintiff
15

The term "robosigning" does not accurately describe the pattern and practice. The pattern and practice are
more accurately described as contract perjury, contract forgery, evidence fabrication, fraud upon the Court,
and theft in which families are rendered homeless as a result of criminal behavior.
16

The practice from investopedia, "In the third and fourth quarters of 2010, a robo-signing scandal emerged
in the United States involving GMAC Mortgage and a number of major U.S banks. Banks had to halt
thousands of foreclosures in numerous states when it became known that the paperwork was illegitimate
because the signers had not actually reviewed it. While some robo-signers were middle managers, others
were temporary workers with virtually no understanding of the work they were doing."

31

presented to the court in their case to establish their ownership

of the alleged Note & Mortgage and their subsequent right to
initiate this foreclosure suit against Defendant.
The above Love conclusory affidavit represents that it is
based on Loves familiarity with Defendants account stating
Affiant has access of and has personal knowledge of the
accounts of said company, and specifically with the account of
John L. Reed, defendant herein. Love also avers that said
account is in default and that plaintiff has elected to call the
entire balance of said account due and payable... While the
Love Affidavit states that Loves personal knowledge is limited
to her review of Option One Mortgage Co. as Servicing Agent
for Plaintiff, Love fails to identify, describe or annex the
particular business records upon which her limited knowledge is
based.
Significantly, the Love Moving Affidavit makes the
conclusory representation that plaintiff has been in continuous
possession of the note and mortgage since prior to the
commencement of this action without providing any factual
details, or the source of Loves knowledge. In addition to a lack
of foundation, the Love Moving Affidavit fails to provide
evidence that the originating lender, H&R Block Inc., indorsed
and physically delivered the alleged Reed Note to the Asset
Backed Receivables Trust.
Defendant has repeatedly denied plaintiffs actions on the
ground that Plaintiff Wells Fargo Bank as Trustee for trust lacks
standing to foreclose.
Specifically, Defendant contends and has always
contended in each and every of his pleadings that Ms. Love also

32

lacked the actual authority to execute the Option One

Assignment.
The above referenced affidavit of John Obrien, combined
with the several other factual inconsistencies the Defendant has
previously articulated to this Court17

18 19 20

, prove beyond any

doubt that Plaintiffs position, a position which is completely

void of legal standing to have initiated this foreclosure action
against Defendant, could not have been accomplished without
the use of, as was previously articulated by Defendant,21 forged
and fraudulently created documents, created specifically by and
delivered into this Court while being Certified as being true, just
and accurate by Plaintiff and Plaintiffs Counsel for the sole
purpose of blinding this Court to the legal realities of their
position and the situation which then lead to the ultimate theft
of Defendants home, loss of Defendants personal and business
inventory and possessions, forced homelessness upon Defendant
and became the cause of Defendants mental injury while
allowing Plaintiffs own unjust enrichment.
As a result, the Courts November 13th, 2008 entry
granting Plaintiffs motion for judgment and issuing a decree of
foreclosure should be void ab initio (as opposed to voidable).
17

Answer of Defendant John Reed (5/26/2008) 8, 11, 12, 13, 14, 15, 17, 18, 19, 20, 21, 22, 23, and
throughout the rest of the pleadings.
18

Answer of Defendant John A. Reed Memorandum in Opposition to Plaintiffs Motion For Summary
Judgment and Request For Trial By Jury (filed Aug, 15th, 2008) The opening statement Firstly, You
Honor, the plaintiff hasnt even proven that it owned or held the promissory note which is the subject of the
complaint 1, 2,
19

Each and every other pleading submitted by Defendant and already a part of this legal actions record.
MOTION TO APPEAL THE DECISION, ORDER AND ENTRY OVERRULING DEFENDANTS
EMERGENCY AMENDED MOTION TO VACATE A VOID JUDGMENT in its entirety
20

21

MOTION TO APPEAL THE DECISION, ORDER AND ENTRY OVERRULING DEFENDANTS

EMERGENCY AMENDED MOTION TO VACATE A VOID JUDGMENT at 4 thru 16, 35, 45, 46, 47,48,
50, 52, 58, 60, 67, 239, 240, 241, 242, .

33

Accordingly, based upon the foregoing, Defendant

respectfully requests that the November 13th 2008 entry be
vacated and this matter remanded back to the Civil Court with
instruction to dismiss, instruction to quiet title and each of
Defendants Counterclaims to be lawfully adjudged.

Respectfully submitted,

________________________
John A. Reed
40 Maple Ave.
Centerville, Ohio
45459

937-890-2576
Yotraj@Yahoo.com

34

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be
cited as Fed Home Loan Mtge. Corp. v. Schwartzwald, Slip Opinion No. 20120hio-5017.]

NOTICE
This slip opinion is subject to formal revision before it is published in an advance
sheet of the Ohio Official Reports. Readers are requested to promptly notify the
Reporter of Decisions, Supreme Court of Ohio, 65 South Front Street, Columbus,
Ohio 43215, of any typographical or other formal errors in the opinion, in order
that corrections may be made before the opinion is published.

SLIP OPINION No. 2012-0HIO-5017

FEDERAL HOME LOAN MORTGAGE CORPORATION, APPELLEE, v.
SCHWARTZWALD ET AL., APPELLANTS.
[Until this opinion appears in the Ohio Official Reports advance sheets,
it may be cited as Fed. Home Loan Mtge. Corp. v. Schwartzwald,

Slip Opinion No. 2012-0hio-5017.]

Foreclosure---Jurisdictional aspects of standing-Civ.R. 17(A)-Jurisdiction
determined as of time of filing suit.
(Nos. 2011-1201 and 2011-1362-Submitted April 4, 2012-Decided
October 31, 2012.)

APPEAL from and CERTIFIED by the Court of Appeals for Greene County,
No. 2010 CA 41, 194 Ohio App.3d 644, 2011-Ohio-2681.

O'DONNELL, J.
{1} Duane and Julie Schwartzwald appeal from a judgment of the
Second District Court of Appeals affirming a decree of foreclosure entered in
favor of the Federal Home Loan Mortgage Corporation. In addition, the appellate
court certified that its decision in this case conflicts with decisions of the First and

35

SUPREME COURT OF OHIO

Eighth Districts on the following issue: "In a mortgage foreclosure action, the
lack of standing or a real party in interest defect can be cured by the assignment of
the mortgage prior to judgment."
{2} Federal Home Loan commenced this foreclosure action before it
obtained an assignment of the promissory note and mortgage securing the
Schwartzwalds loan. The Schwartzwalds maintained that Federal Home Loan
lacked standing to sue. The trial court granted summary judgment in favor of
Federal Home Loan and entered a decree of foreclosure. The appellate court
affirmed, holding that Federal Home Loan had remedied its lack of standing when
it obtained an assignment from the real party in interest.
{3} However, standing is required to invoke the jurisdiction of the
common pleas court, and therefore it is determined as of the filing of the
complaint. Thus, receiving an assignment of a promissory note and mortgage
from the real party in interest subsequent to the filing of an action but prior to the
entry of judgment does not cure a lack of standing to file a foreclosure action.
(4} Accordingly, the judgment of the court of appeals is reversed, and
the cause is dismissed.
Facts and Procedural History
(5} In November 2006, Duane and Julie Schwartzwald purchased a
home in Xenia, Ohio, and received a mortgage loan from Legacy Mortgage in the
amount of $251,250. They executed a promissory note and a mortgage granting
Legacy Mortgage a security interest in the property. Legacy Mortgage then
endorsed the promissory note as payable to Wells Fargo Bank, N.A., and assigned
it the mortgage.
{ 6} In September 2008, Duane Schwartzwald lost his job at Barco,
36

Inc., and the Schwartzwalds moved to Indiana so he could accept a new position.
They continued making mortgage payments as they tried to sell the house in
Xenia, but they went into default on January 1, 2009. In March 2009, Wells

January Term, 2012

Fargo agreed to list the property for a short sale, and on April 8, 2009, the
Schwartzwalds entered into a contract to sell it for $259,900, with closing set for
June 8, 2009.
{7} However, on April 15, 2009, Federal Home Loan Mortgage
Corporation commenced this foreclosure action, alleging that the Schwartzwalds
had defaulted on their loan and owed $245,085.18 plus interest, costs, and
advances. It attached a copy of the mortgage identifying the Schwartzwalds as
borrowers and Legacy Mortgage as lender, but did not attach a copy of the note,
claiming that "a copy of [the note] is currently unavailable."
{8} Julie Schwartzwald then contacted Wells Fargo about the
foreclosure complaint. She testified, "I was told that it was 'standard procedure'
and 'don't worry about it' because we were doing a short sale." The
Schwartzwalds did not answer the complaint.
{9} On April 24, 2009, Federal Home Loan filed with the court a copy
of the note signed by the Schwartzwalds in favor of Legacy Mortgage. The final
page carries a blank endorsement by Wells Fargo placed above the endorsement
by Legacy Mortgage payable to Wells Fargo.
{10} On May 15, 2009, Wells Fargo assigned the note and mortgage to
Federal Home Loan, and Federal Home Loan filed with the court a copy of the
37

assignment on June 17, 2009. It then moved for a default judgment and a
summary judgment, but the trial court discovered that Federal Home Loan had
failed to establish a chain of title because no assignment of the mortgage from
Legacy Mortgage to Wells Fargo appeared in the record.
{11} During this time, even though it had assigned its interest in the
note and mortgage to Federal Home Loan, Wells Fargo continued discussing a
short sale of the property with the Schwartzwalds, but delays in. this process
eventually caused the Schwartzwalds' buyer to rescind the offer. On December
14, 2009, the trial court granted the Schwartzwalds leave to file an answer. That

SUPREME COURT OF OHIO

same day, Federal Home Loan filed with the court a copy of the assignment of the
mortgage from Legacy Mortgage to Wells Fargo dated November 27,2006.
{12} Federal Home Loan again moved for summary judgment,
supporting the motion with the affidavit of Herman John Kennerty, vice president
of loan documentation for Wells Fargo as servicing agent for Federal Home Loan,
who averred that the Schwartzwalds were in default and who authenticated the .
note and mortgage as well as the assignment of the note and mortgage from Wells
Fargo. Subsequently, Federal Home Loan filed copies of the notarized
assignments from Legacy Mortgage to Wells Fargo and from Wells Fargo to
38

Federal Home Loan.

{13} The Schwartzwalds also moved for summary judgment, asserting
that Federal Home Loan lacked standing to foreclose on their property.
{14} The trial court entered summary judgment for Federal Home Loan,
finding that the Schwartzwalds had defaulted on the note, and it ordered the
equity of redemption foreclosed and the property sold. Federal Home Loan
purchased the property at a sheriff's sale.
{15} On appeal, the Second District Court of Appeals affirmed and held
that Federal Home Loan had established its right to enforce the promissory note
as a nonholder in possession, because assignment of the mortgage effected a
transfer of the note it secured. The court further explained that standing is not a
jurisdictional prerequisite and that a lack of standing may be cured by substituting
the real party in interest for an original party pursuant to Civ.R. 17(A). Thus, the
court concluded that although Federal Home Loan lacked standing at the time it
commenced the foreclosure action, it cured that defect by the assignment of the
mortgage and transfer of the note prior to entry of judgment.
{16} The court of appeals certified that its decision conflicted with
Wells Fargo Bank, N.A. v. Byrd, 178 Ohio App.3d 285, 2008-0hio-4603, 897
N.E.2d 722 (1st Dist.), 15-16; Bank of New York v. Gindele, 1st Dist. No. C-

January Term, 2012

39

090251, 2010-0hio-542, 3-4; and Wells Fargo Bank, N.A. v. Jordan, 8th Dist.
No. 91675, 2009-0hio-I092, 21, cases that held that a lack of standing cannot
be cured by substituting the real party in interest for an original party pursuant to
Civ.R. 17(A). We accepted the conflict and the Schwartzwalds' discretionary
appeal on the same issue.
Arguments on Appeal
{17} The Schwartzwalds explain that the essential aspect of standing is
injury to a legally protected right and claim that Federal Home Loan had not been
injured by their default at the time it commenced this foreclosure action, because
it had not obtained the note and mortgage until after it filed the complaint.
Relying on federal caselaw, they maintain that standing is determined as of the
time the action is brought, so that subsequent events do not cure a lack of
standing. They further urge that although the requirement of a real party in
interest can be waived, that requirement cannot be equated with the requirement
of standing.
{18} Federal Home Loan asserts that pursuant to R.C. 1303.31, it is a
"person entitled to enforce the note" because it is "[a] nonholder in possession of
the instrument who has the rights of a holder" by virtue of the negotiation of the
note from Legacy to Wells Fargo and the assignment from Wells Fargo. Further,
it maintains that R.C. 1303.31 defines only which party is entitled to enforce a
note and that the failure to be a real party in interest at the commencement of suit
can be cured pursuant to Civ.R. 17(A) by the assignment of the mortgage, and
note. It also contends that the jurisdictional requirement of justiciability is
satisfied if the allegations of the complaint establish that the plaintiff has standing
to present a justiciable controversy and that even if it is determined that those
allegations were in fact false, the matter remains justiciable so long as the plaintiff
subsequently obtains the right to foreclose prior to judgment. On this basis, it
argues that because "the Ohio Constitution bestows general (and not limited)

40

SUPREME COURT OF OHIO

jurisdiction on common pleas courts, common pleas courts have 'jurisdiction' to

hear disputes, even if the named plaintiff was not the correct person to invoke it."
Thus, it concedes that the record in this case does not establish that it was a
person entitled to enforce the note as of the date the complaint was filed, but it
maintains that it "proved that it was such a person prior to judgment."
{19} Accordingly, the question presented is whether a lack of standing
at the commencement of a foreclosure action filed in a common pleas court may
be cured by obtaining an assignment of a note and mortgage sufficient to establish
standing prior to the entry of judgment.
Law and Analysis .
Standing to Sue
{20} The Ohio Constitution provides in Article IV, Section 4(B); "The
courts of common pleas and divisions thereof shall have such original jurisdiction
over all justiciable matters and such powers of review of proceedings of
administrative officers and agencies as may be provided by law." (Emphasis
added.)
{21} In Cleveland v. Shaker Hts., 30 Ohio St.3d 49, 51, 507 N.E.2d 323
(I 987), we stated:
" 'Whether a party has a sufficient stake in an otherwise
justiciable controversy to obtain judicial resolution of that
41

controversy is what has traditionally been referred to as the

question of standing to sue. Where the 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." "

January Term, 2012

Id, quoting Middletown v. Ferguson, 25 Ohio St.3d 71, 75, 495 N.E.2d 380
(1986), quoting Sierra Club v. Morton, 405 U.S. 727, 731-732, 92 S.Ct. 1361, 31
L.Ed.2d 636 (1972), quoting Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct. 691, 7
L.Ed.2d 663 (1972). Similarly, the United States Supreme Court observed in
Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 102, 118 S.Ct. 1003,
140 L.Ed.2d 210 (1998), that "[s]tanding to sue is part of the common
understanding of what it takes to make a justiciable case."
{22} We recognized that standing is a "jurisdictional requirement" in
State ex rel. Dallman v. Franklin Cty. Court of Common Pleas, 35 Ohio St.2d
176, 179, 298 N.E.2d 515 (1973), and we stated: "It is an elementary concept of
law that a party lacks standing to invoke the jurisdiction of the court unless he has,
in an individual or representative capacity, some real interest in the subject matter
of the action." (Emphasis added.) See also New Boston Coke Corp. v. Tyler, 32
Ohio St.3d 216, 218, 513 N.E.2d 302 (1987) (''the issue of standing, inasmuch as
it is jurisdictional in nature, may be raised at any time during the pendency of the
42

proceedings"); Steinglass & Scarselli, The Ohio State Constitution: A Reference

Guide 180 (2004) (noting that the jurisdiction of the common pleas court is
limited to justiciable matters).
{23} And recently, in Kincaid v. Erie Ins. Co., 128 Ohio St.3d 322,
2010-0hio-6036, 944 N.E.2d 207, we affirmed the dismissal of a complaint for
lack of standing when it had been filed before the claimant had suffered any
injury. There, Kincaid asserted claims that his insurer had breached the insurance
contract by failing to pay expenses covered by the policy; however, he had never
presented a claim for reimbursement to the insurer. We concluded that Kincaid
lacked standing to assert the cause of action, explaining, "Until Erie refuses to pay
a claim for a loss, Kincaid has suffered no actual damages for breach of contract,
the parties do not have adverse legal interests, and there is no justiciable
controversy." Id. at 13.

SUPREME COURT OF OHIO

{24} Because standing to sue is required to invoke the jurisdiction of the

common pleas court, "standing is to be determined as of the commencement of
suit." Lujan v. Defenders of Wildlife, 504 U.S. 555, 570-571, 112 S.Ct. 2130, 119
L.Ed.2d 351 (1992), fn. 5; see also Friends of the Earth, Inc. v. Laidlaw
Environmental Servs. (TOC), 528 U.S. 167, 180, 120 S.Ct.693, 145 L.Ed.2d 610
43

(2000); Nova Health Sys. v. Gandy, 416 F.3d 1149, 1154-1155 (10th Cir.2005);
Focus on the Family v. Pinellas Suncoast Transit Auth., 344 F.3d 1263, 1275
(11th Cir.2003); Perry v. Arlington Hts., 186 F.3d 826, 830 (7th Cir.1999); Carr
v. Alta Verde Industries, lnc., 931 F.2d 1055, 1061 (5th Cir.1991).
{25} Further, invoking the jurisdiction of the court "depends on the state
of things at the time of the action brought," Mullan v. Torrance, 22 U.S. 537, 539,
6 L.Ed. 154 (1824), and the Supreme Court has observed that "[t]he state of
things and the originally alleged state of things are not synonymous;
demonstration that the original allegations were false will defeat jurisdiction."
Rockwell Internatl. Corp. v. United States, 549 U.S. 457, 473, 127 S.Ct. 1397,
167 L.Ed.2d 190 (2007).
{26} Thus, "[p]ost-filing events that supply standing that did not exist
on filing may be disregarded, denying standing despite a showing of sufficient
present injury caused by the challenged acts and capable of judicial redress." 13A
Wright, Miller & Cooper, Federal Practice and Procedure 9, Section 3531
(2008); see Grupo Dataflux v. Atlas Global Group, L.P., 541 U.S. 567, 575, 124
S.Ct. 1920, 158 L.Ed.2d 866 (2004), quoting Caterpillar Inc. v. Lewis, 519 U.S.
61, 75, 117 S.Ct. 467, 136 L.Ed.2d 437 (rejecting argument that" 'finality,
efficiency, and judicial economy' " can justify suspension of the time-of-filing
rule); Utah Assn. of Counties v. Bush, 455 F.3d 1094, 1101, and fn. 6 (10th
Cir.2006) (a plaintiff cannot rely on injuries occurring after the filing of the
complaint to establish standing).

January Term, 2012

44

{27} This principle accords with decisions from other states holding that
standing is determined as of the filing the complaint. See, e.g., Deutsche Bank
Natl. Trust v. Brumbaugh, 2012 OK 3, 270 P.3d 151, 11 ("If Deutsche Bank
became a person entitled to enforce the note as either a holder or nonholder in
possession who has the rights of a holder after the foreclosure action was filed,
then the case may be dismissed without prejudice * * *" [emphasis added]); U.S.
Bank Natl. Assn. v. Kimball, 190 Vt. 210, 2011 VT 81, 27 A.3d 1087, 14 ("U.S.
Bank was required to show that at the time the complaint was filed it possessed
the original note either made payable to bearer with a blank endorsement or made
payable to order with an endorsement specifically to U.S. Bank" [emphasis
added]); Mtge. Electronic Registration Sys., Inc.v. Saunders, 2010 ME 79, 2 A.3d
287, 15 ("Without possession of or any interest in the note, MERS lacked
standing to institute foreclosure proceedings and could not invoke the jurisdiction
of our trial courts" [emphasis added]); RMS Residential Properties, L.L.C. v,
Miller, 303 Conn. 224, 229, 232, 32 A.3d 309 (2011), quoting Hiland v. Ives, 28
Conn.Supp. 243, 245, 257 A.2d 822 (1966) (explaining that" '[s]tanding is the
legal right to set judicial machinery in motion' " and holding that the plaintiff had
standing because it proved ownership of the note and mortgage at the time it
commenced foreclosure action); Mclean v. JP Morgan Chase Bank Natl. Assn.,
79 So.3d 170, 173 (Fla.App.2012) ("the plaintiff must prove that it had standing
to foreclose when the complaint was filed"); see also Burley v. Douglas, 26 So.3d
1013, 1019 (Miss.2009), quoting Lujan v. Defenders of Wildlife, 504 U.S. 555,
571, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992), fn. 5 ("'standing is to be
determined as of the commencement of suit' "); In re 2007 Administration of
Appropriations of Water of the Niobrara, 278 Neb. 137, 145, 768 N.W.2d 420
(2009) ("only a party that has standing may invoke the jurisdiction of a court or
tribunal. And the junior appropriators did not lose standing if they possessed it
under the facts existing when they commenced the litigation" [footnote omitted]).

45

SUPREME COURT OF OHIO

{28} Here, Federal Home Loan concedes that there is no evidence that it
had suffered any injury at the time it commenced this foreclosure action. Thus,
because it failed to establish an interest in the note or mortgage at the time it filed
suit, it had no standing to invoke the jurisdiction of the common pleas court.
The Real-Party-in-Interest Rule
{ 29} The court of appeals and Federal Home Loan relied on the
plurality opinion in State ex rel. Jones v. Suster, 84 Ohio St.d 70, 77, 701 N.E.2d
1002 (1998), which suggested that "[t]he lack of standing may be cured by
substituting the proper party so that a court otherwise having subject matter
jurisdiction may proceed to adjudicate the matter. Civ.R. 17." However, four
justices declined to join that portion of the opinion, and therefore it is not a
holding of this court. See Ohio Constitution, Article N, Section 2(A) ("A
majority of the supreme court shall be necessary to constitute a quorum or to
render a judgment").
{30} At common law, all actions had to be brought in the name of the
person holding legal title to the right asserted, and individuals possessing only
equitable or beneficial interests could not sue in their own right. See generally
Clark & Hutchins, The Real Party in Interest, 34 Yale L.J. 259 (1925); 6A
Wright, Miller & Kane, Federal Practice and Procedure, Section 1541 (2010).
However, the practice in equity relaxed this requirement, and states later
46

abrogated the common-law rules and adopted "rules that permitted any 'real party
in interest' to bring suit." Sprint Communications Co., L.P. v.APCC Servs., Inc.,
554 U.S. 269, 279, 128 S.Ct. 2531, 171 L.Ed 2d 424 (2008).
{31} In Ohio, Civ.R. 17(A) governs the procedural requirement that a
complaint be brought in the name of the real party in interest and provides:
Every action shall be prosecuted in the name of the real party in
interest. An executor, administrator, guardian, bailee,

10

January Term, 2012

trustee of an express trust, a party with whom or in whose name a contract
has been made for the benefit of another, or a party authorized by statute
may sue in his name as such representative without joining with him the
party for whose benefit the action is brought. When a statute of this.state
so provides, an action for the use or benefit of another shall be brought in
the name of this state. No action shall be dismissed on the ground that it is
not prosecuted in the name of the real party in interest until a reasonable
time has been allowed after objection for ratification of commencement of
the action by, or joinder or substitution of, the real party in interest. Such
ratification, joinder, or substitution shall have the same effect as if the
action had been commenced in the name of the real party .in interest.
{32} Considering Civ.R. 17(A) in Shealy v. Campbell, 20 Ohio St.3d 23,
2425,485 N.E.2d 701 (1985), we observed:

47

The purpose behind the real party in interest rule is '* * * to

enable the defendant to avail himself of evidence and defenses that the
defendant has against the real party in interest, and to assure him finality
of the judgment, and that he will be protected against another suit brought
by the real party at interest on the same matter.' Celanese Corp. of
America v. John Clark Industries (5 Cir.l954), 214 F.2d 551, 556." [In re
Highland Holiday Subdivision (1971), 27 Ohio App.2d 237] 240 [273
N.E.2d 903).
{33} As the Supreme Court explained in Lincoln Property Co. v. Roche,
546 U.S. 81,90, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005), the real-party-in-interest
rule concerns only proper party joinder. Civ.R. 17(A) does not address standing;
rather, the point of the rule is that "suits by representative plaintiffs on behalf of
the real parties in interest are the exception rather than the rule and should only be
allowed when the real parties in interest are identifiable and the res judicata scope
of the judgment can be effectively determined.". Consumer Fedn. of Am. v.
Upjohn Co., 346 A.2d 725, 729 (D.C.1975) (construing analogous District of
Columbia rule).
{34} Thus, the Third and the Ninth Circuits have rejected the notion that
Fed.R.Civ.P. 17(a), on which Civ.R. 17(A) is based, allows a party with no
personal stake in a controversy to file a claim on behalf of a third party, obtain the
cause of action by assignment, and then have the assignment relate back to
commencement of the action, stating:
"Rule 17(a) does not apply to a situation where a party with no
cause of action files a lawsuit to toll the statute of limitations and later
obtains a cause of action through assignment. Rule 17(a) is the
codification of the salutary principle that an action should not be forfeited
because of an honest mistake; it is not a provision to be distorted by
parties to circumvent the limitations period."
Gardner v. State Farm Fire & Cas. Co., 544F.3d 553, 563 (3d Cir.2008), quoting
48

United States ex rel. Wulff v. CMA, Inc., 890 F.2d 1070, 1075 (9th Cir.l989).
{ 35} The Sixth Circuit Court of Appeals' decision in Zurich Ins. Co. v.
Logitrans, Inc., 297 F.3d 528 (6th Cir.2002), illustrates this point. In that case, a
fire at a warehouse destroyed property insured by American Guarantee, which
paid out a claim for damages. However, another insurance company, Zurich
Switzerland, filed a complaint claiming to be the insured's subrogee,
notwithstanding the fact that Zurich Switzerland had neither issued an insurance
12
January Term,2012
policy nor paid out any money to the insured. The defendants moved to dismiss
for lack of standing, and. Zurich Switzerland sought to substitute American
Guarantee as the real party in interest pursuant to Fed.R.Civ.P. 17(a). The district
court dismissed the action.
{36} The Sixth Circuit Court of Appeals acknowledged that the statute of
limitations would bar American Guarantee's claim unless Fed.R.Civ.P. 17(a)
allowed it to be substituted for Zurich Switzerland. However, the court
distinguished between the requirement of standing and the objection that the
plaintiff is not the real party in interest, and it held that because "Zurich American
admittedly has not suffered injury in fact by the defendants, it had no standing to
bring this action and no standing to make a motion to substitute the real party in
interest." ld.
{37} Other courts have also determined that a plaintiff cannot rely on
procedural rules similar to Civ.R. 17(A) to cure a lack of standing at the
commencement of litigation.. Davis v. Yageo Corp., 481 F.3d 661, 678 (9th
Cir.2007) ("whether or not Dux was the real-party-in-interest, it does not have
standing, and it cannot cure its standing problem through an invocation of
Fed.R.Civ.P. 17(a)"); Clark v. Trailiner Corp., 242 F.3d 388 (10th Cir.2000)
(table), opinion reported at 2000 WL 1694299 (noting that the plaintiff cannot
49

"retroactively become the real-party-in-interest" in order to cure a lack of

standing at the filing of the complaint [emphasis sic]); accord State v. Property at
2018 Rainbow Drive, 740 So.2d 1025, 1027-1028 (Ala.1999) (rejecting the
argument that a lack of standing can be cured after filing of the complaint);
Consumer Fedn. of Am. v. Upjohn Co., 346 A.2d 725, 729 (D.C.App.1975)
(explaining that dismissal for lack of standing is consistent with D.C.
Super.Ct.Civ.R. 17(a)); see also McLean v. JPMorgan Chase Bank Natl. Assn.,
79 So.3d 170, 173 (Fla.App.2012) ("a party is not permitted to establish the right

13
SUPREME COURT OF OHIO

to maintain an action retroactively by acquiring standing to file a lawsuit after the

fact").
{38} We agree with the reasoning and analysis presented in these cases.
Standing is required to invoke the jurisdiction of the common pleas court.
Pursuant to Civ.R. 82, the Rules of Civil Procedure do not extend the jurisdiction
of the courts of this state, and a common pleas court cannot substitute a real party
in interest for another party if no party with standing has invoked its jurisdiction
in the first instance.
{39} Accordingly, a litigant cannot pursuant to Civ.R. 17(A) cure the
lack of standing after commencement of the action by obtaining an interest in the
subject of the litigation and substituting itself as the real party in interest.
Effect of Lack of Standing on Foreclosure Actions
{40} The lack of standing at the commencement of a foreclosure action
requires dismissal of the complaint; however, that dismissal is not an adjudication
on the merits and is therefore without prejudice. See State ex rel, Coles v.
Granville, 116 Ohio St.3d 231, 2007-0hio-6057, 877N.E.2d 968, 51. Because
there has been no adjudication on the underlying indebtedness, our dismissal has
50

no effect on the underlying duties, rights, or obligations of the parties.

Conclusion
{41} It is fundamental that a party commencing litigation must have
standing to sue in order to present a justiciable controversy and invoke the
jurisdiction of the common pleas court. Civ.R. 17(A) does not change this
principle, and a lack of standing at the outset of litigation cannot be cured by
receipt of an assignment of the claim or by substitution of the real party in
interest.'
{ 42} Here, it is undisputed that Federal Home Loan did not have
standing at the time it commenced this foreclosure action, and therefore it failed

14
January Term, 2012

to invoke the jurisdiction of the court of common pleas. Accordingly, the

judgment of the court of appeals is reversed, and the cause is dismissed.
Judgment reversed
and cause dismissed.
O'CONNOR, C.J., and PFEIFER, LUNDBERG STRAlTON,
ANZlNGER, CUPP, and MCGEE BROWN,JJ., concur.
_____________________________
Thompson Hine, L.L.P., Scott A. King, and Terry W. Posey Jr., for
appellee.
Andrew M. Engle, for appellants.
Bruce M. Broyles, urging reversal for amici curiae Homeowners of the
State of Ohio and Ohiofraudclosure.blogspot.com,
Advocates for Basic Legal Equality, Inc., and Andrew D. Neuhauser;
Legal Aid Society of Cleveland and Julie K. Robie; Legal Aid Society of
51

Southwest Ohio, L.L.C., and Noel M. Morgan; Community Legal Aid Services,
Inc., Christina M. Janice, and Paul E. Zindle; and Ohio Poverty Law Center and
Linda Cook, urging reversal for amici curiae Advocates for Basic Legal Equality,
Inc., Legal Aid Society of Cleveland, Legal Aid Society of Southwest Ohio,
L.L.C., Community Legal Aid Services, Inc., Ohio Poverty Law Center, Legal
Aid Society of Columbus, Southeastern Ohio Legal Services, Legal Aid of
Western Ohio, and Pro Seniors, Inc.
______________________________

52

EXHIBITS
Exhibit A
Original Complaint

53

54

55

56

57

58

59

60

61

62

63

64

65

66

67

68

69

70

71

72

73

74

75

76

77

78

Exhibit B
Assignment of Mortgage from Option One Mort. Corp.
to Wells Fargo Bank Na.

79

Exhibit C
Notice of Filing of Assignment

80

81

82

83

84

85