Title: Wells Fargo Bank, N.A. v. Horn

State: ohio

Issuer: Ohio Supreme Court

Document:

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as 
Wells Fargo Bank, N.A. v. Horn, Slip Opinion No. 2015-Ohio-1484.] 
 
 
 
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. 2015-OHIO-1484 
WELLS FARGO BANK, N.A., APPELLANT, v. HORN, APPELLEE, ET AL. 
[Until this opinion appears in the Ohio Official Reports advance sheets, it 
may be cited as Wells Fargo Bank, N.A. v. Horn, Slip Opinion  
No. 2015-Ohio-1484.] 
Foreclosure—Although the plaintiff in a foreclosure action must have standing at 
the time suit is commenced, proof of standing may be submitted 
subsequent to the filing of the complaint. 
(No. 2013-1534—Submitted January 14, 2015—Decided April 22, 2015.) 
APPEAL from the Court of Appeals for Lorain County, 
No. 12CA010230, 2013-Ohio-2374. 
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SYLLABUS OF THE COURT 
Although the plaintiff in a foreclosure action must have standing at the time suit is 
commenced, proof of standing may be submitted subsequent to the filing 
of the complaint.  (Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 
Ohio St.3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, explained.) 
SUPREME COURT OF OHIO 
 
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KENNEDY, J. 
I. Introduction 
{¶ 1} In this discretionary appeal, we review an opinion of the Ninth 
District Court of Appeals that interpreted Fed. Home Loan Mtge. Corp. v. 
Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, to require 
the plaintiff in a foreclosure action to attach documents to its complaint to prove 
that it has standing to maintain the action.  The plaintiff-appellant sets forth the 
following proposition of law:  “A plaintiff is not required to attach to the 
complaint all of the evidence upon which it will rely to show standing.”  We hold 
that Schwartzwald does not require the plaintiff to prove standing at the time the 
foreclosure action is filed.  Rather, although the plaintiff in a foreclosure action 
must have standing at the time suit is commenced, proof of standing may be 
submitted subsequent to the filing of the complaint.  Therefore, we reverse the 
judgment of the court of appeals and remand this cause to that court for further 
proceedings. 
II. Facts and Procedural History 
{¶ 2} On April 19, 2010, plaintiff-appellant, Wells Fargo Bank, N.A., filed 
a foreclosure action against Brian and Carol Horn for allegedly defaulting on a 
promissory note.  The complaint’s caption named the plaintiff as:  “Wells Fargo 
Bank, N.A. successor by merger to Wells Fargo Home Mortgage, Inc. fka 
Norwest Mortgage, Inc.”  The complaint alleged that the Horns were immune 
from liability on the note because they had gone through bankruptcy.  
Consequently, Wells Fargo sought to foreclose against only the mortgage that 
provided a security interest in the note.  Attached to the complaint were several 
exhibits.  One purports to be a copy of a promissory note endorsed in blank, 
identifying Norwest Mortgage as the lender and the Horns as the borrowers.  The 
 
January Term, 2015 
 
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other purports to be a copy of a mortgage that secured the note, again identifying 
the Horns as the borrowers and Norwest Mortgage as the lender. 
{¶ 3} Acting pro se, appellee, Brian Horn, filed a “Response to 
Complaint.”  Wells Fargo then filed a motion for summary judgment.  Horn hired 
counsel, who filed a formal answer that asserted numerous defenses, including 
that Wells Fargo “may not be the real party in interest and lacks standing to bring 
said claim against [Horn].” 
{¶ 4} Wells Fargo filed an amended motion for summary judgment that 
included the assertion that as the holder of the note and mortgage at the time the 
complaint was filed, it had standing to bring the action.  In support, Wells Fargo 
submitted the affidavit of Adam Seeman, a “Default Litigation Specialist” for 
Wells Fargo, who averred, among other things, that Norwest Mortgage, Inc., had 
changed its name to Wells Fargo Home Mortgage, Inc., in 2000, that Wells Fargo 
Home Mortgage, Inc., had later merged into Wells Fargo, and that Wells Fargo 
was the holder of the note and mortgage prior to the filing of the complaint.  
Accompanying the affidavit were a “Certificate of Amendment to Foreign 
Corporation Application for License,” issued by the Ohio secretary of state in 
April 2000, indicating that the company named Norwest Mortgage, Inc., had 
changed its name to Wells Fargo Home Mortgage, Inc., and a “Certificate of 
Filing,” issued by the California secretary of state indicating that Wells Fargo 
Home Mortgage, Inc., had merged into Wells Fargo in 2004.  The trial court 
adopted a magistrate’s decision and granted Wells Fargo’s motion for summary 
judgment, and the trial court eventually issued a decree of foreclosure in Wells 
Fargo’s favor. 
{¶ 5} Horn, again acting pro se, appealed, asserting four assignments of 
error, none of which challenged the conclusion of the magistrate and the trial 
court that Wells Fargo had standing to bring the foreclosure suit. 
SUPREME COURT OF OHIO 
 
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{¶ 6} However, rather than considering Horn’s assignments of error, the 
court of appeals sua sponte considered the issue of standing.  The court of 
appeals, relying on Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, 979 
N.E.2d 1214, held that a plaintiff in a foreclosure action must attach to its 
complaint documents that prove that it has standing at the time the complaint is 
filed.  9th Dist. Lorain No. 12CA010230, 2013-Ohio-2374, ¶ 12.  Consequently, 
because Wells Fargo had not attached documentation to its complaint that set 
forth that Wells Fargo was the successor to Wells Fargo Home Mortgage, Inc., 
and Norwest Mortgage, Inc., the court of appeals held that Wells Fargo lacked 
standing to bring this foreclosure action against Horn and to invoke the 
jurisdiction of the trial court, and it remanded the case to the trial court to dismiss 
the complaint without prejudice.  Id. at ¶ 13. 
{¶ 7} We initially declined to accept Wells Fargo’s discretionary appeal.  
137 Ohio St.3d 1473, 2014-Ohio-176, 2 N.E.3d 268.  We later granted in part 
Wells Fargo’s motion for reconsideration and accepted the appeal on the first 
proposition of law only.  138 Ohio St.3d 1452, 2014-Ohio-1182, 5 N.E.3d 668.  
Wells Fargo argues that a plaintiff in a foreclosure action is not required to attach 
to its complaint the evidence upon which it will rely to prove standing.  Horn, 
acting pro se, raises four “assignments of error” in his appellee brief that are not 
responsive to the arguments regarding the issue of standing.  After the case was 
fully briefed, Horn obtained counsel, and an attorney appeared on his behalf at 
oral argument. 
III. Analysis 
Standing Generally 
{¶ 8} Generally speaking, standing is “[a] party’s right to make a legal 
claim or seek judicial enforcement of a duty or right.”  Black’s Law Dictionary 
1625 (10th Ed.2014).  “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 
 
January Term, 2015 
 
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representative capacity, some real interest in the subject matter of the action.”  
State ex rel. Dallman v. Franklin Cty. Court of Common Pleas, 35 Ohio St.2d 
176, 179, 298 N.E.2d 515 (1973). 
 
Standing is certainly a jurisdictional requirement; a 
party’s lack of standing vitiates the party’s ability to invoke the 
jurisdiction of a court—even a court of competent subject-
matter jurisdiction—over the party’s attempted action.  But an 
inquiry into a party’s ability to invoke a court’s jurisdiction 
speaks to jurisdiction over a particular case, not subject-matter 
jurisdiction. 
 
(Citations omitted and emphasis sic.)  Bank of Am., N.A. v. Kuchta, 141 Ohio 
St.3d 75, 2014-Ohio-4275, 21 N.E.3d 1040, ¶ 22.1 
Schwartzwald’s Requirements for Standing 
{¶ 9} Because the Ninth District Court of Appeals relied on our holding in 
Schwartzwald, 134 Ohio St.3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, in holding 
that a plaintiff in a foreclosure action must attach evidence of standing to its 
complaint in foreclosure, a review of that case is necessary to our analysis. 
{¶ 10} In Schwartzwald, the Schwartzwalds executed a promissory note 
and a mortgage granting a security interest to Legacy Mortgage when they 
purchased a home.  Id. at ¶ 5.  Legacy Mortgage later endorsed the note as payable 
to Wells Fargo Bank, N.A., and also assigned the mortgage to Wells Fargo.  Id.  
                                                 
1 “ ‘Subject-matter jurisdiction of a court connotes the power to hear and decide a case upon its 
merits’ and ‘defines the competency of a court to render a valid judgment in a particular action.’ ”  
Cheap Escape Co., Inc. v. Haddox, L.L.C., 120 Ohio St.3d 493, 2008-Ohio-6323, 900 N.E.2d 601, 
¶ 6, quoting Morrison v. Steiner, 32 Ohio St.2d 86, 87, 290 N.E.2d 841 (1972).  For example, 
absent a proper bindover proceeding for a juvenile offender in juvenile court, the common pleas 
court lacks subject-matter jurisdiction over the case and any conviction obtained in the common 
pleas court is void ab initio.  State v. Wilson, 73 Ohio St.3d 40, 44, 652 N.E.2d 196 (1995). 
SUPREME COURT OF OHIO 
 
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More than two years after they purchased the home, the Schwartzwalds defaulted 
on the loan and agreed with Wells Fargo to a short sale of the property.  Id. at ¶ 6.  
Subsequently, the Federal Home Loan Mortgage Corporation (“FHLMC”) filed a 
foreclosure action against the Schwartzwalds.  FHLMC attached to its complaint a 
copy of the mortgage that identified the Schwartzwalds as the borrowers and 
Legacy as the lender but did not attach a copy of the note.  Id. at ¶ 7.  It was only 
after FHLMC filed its foreclosure complaint that Wells Fargo assigned the 
Schwartzwalds’ note and mortgage to FHLMC.  Id. at ¶ 10.  Because FHLMC did 
not have an interest in the note or mortgage at the time it filed the foreclosure 
action, it was undisputed that FHLMC was not injured and lacked standing to 
invoke the jurisdiction of the trial court when it filed the complaint.  Id. at ¶ 28. 
{¶ 11} The only question before this court was whether a plaintiff’s lack of 
standing can be cured after the foreclosure complaint is filed.  In answering that 
question, we held: 
 
[S]tanding 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. 
 
(Emphasis added.)  Id. at ¶ 3. 
{¶ 12} The import of our holding in Schwartzwald is that the plaintiff in a 
foreclosure action must have standing at the time that it files its complaint.  But 
nowhere in the opinion did this court indicate that the plaintiff must also submit 
proof of standing at that time.  Thus, we agree with the observation that 
“Schwartzwald does not stand for the proposition that a foreclosure plaintiff must 
 
January Term, 2015 
 
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definitively prove in its complaint that it has standing.”  Bank of Am., N.A. v. 
Hafford, 6th Dist. Sandusky No. S-13-021, 2014-Ohio-739, ¶ 14.  Proof of 
standing may be submitted subsequent to filing the complaint.  See U.S. Bank 
Natl. Assn. v. Mitchell, 6th Dist. Sandusky No. S-10-043, 2012-Ohio-3732, ¶ 17-
18; accord Wells Fargo Bank, N.A. v. Stovall, 8th Dist. Cuyahoga No. 91802, 
2010-Ohio-236, ¶ 16-17 (an assignment of the mortgage to the plaintiff, dated 
prior to the filing of the foreclosure complaint and attached to the plaintiff’s 
motion for summary judgment, demonstrated that the plaintiff was the real party 
in interest when the complaint was filed). 
Allegations in a Complaint and Standing 
{¶ 13} To require a plaintiff to attach proof of standing to a foreclosure 
complaint would also run afoul of Ohio’s notice-pleading requirements.  Civ.R. 
7(A) provides that a civil action may be initiated by filing a complaint.  Civ.R. 
8(A) states that a pleading, including a complaint, shall set forth “a short and plain 
statement of the claim showing that the party is entitled to relief.”  Civ.R. 8(E)(1) 
states that “[e]ach averment of a pleading shall be simple, concise, and direct.”  
“The purpose of ‘notice’ pleading is clear: ‘to simplify pleadings to a “short and 
plain statement of the claim” and to simplify statements of the relief demanded, 
Civ.R. 8(A), to the end that the adverse party will receive fair notice of the claim 
and an opportunity to prepare his response thereto.’ ”  Anderson v. BancOhio 
Natl. Bank, 1st Dist. Hamilton No. C-840913, 1985 WL 8844, *1 (Nov. 27, 
1985), quoting Fancher v. Fancher, 8 Ohio App.3d 79, 83, 455 N.E.2d 1344 (1st 
Dist.1982).  Factual allegations made in a complaint are taken as true for purposes 
of determining whether the complaint states a claim.  Mitchell v. Lawson Milk 
Co., 40 Ohio St.3d 190, 192, 532 N.E.2d 753 (1988).  Consequently, a plaintiff at 
the pleading stage is “not required to establish its standing beyond the allegations 
of the Complaint.”  Chase Home Fin., L.L.C. v. Mentschukoff, 11th Dist. Geauga 
No. 2014-G-3205, 2014-Ohio-5469, ¶ 20; see also Riverside v. State, 2d Dist. 
SUPREME COURT OF OHIO 
 
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Montgomery No. 26024, 2014-Ohio-1974, ¶ 28; Revocable Living Trust of 
Mandel v. Lake Erie Util. Co., 8th Dist. Cuyahoga No. 97859, 2012-Ohio-5718,  
¶ 11-13. 
 
[W]hile a foreclosure plaintiff must allege sufficient facts in its 
complaint to demonstrate that it has standing, Schwartzwald 
does not stand for the proposition that a foreclosure plaintiff 
must definitively prove in its complaint that it has standing.  
Indeed, such a requirement would run counter to our 
established system of justice.  See York v. Ohio State Hwy. 
Patrol, 60 Ohio St.3d 143, 144-145, 573 N.E.2d 1063 (1991) 
(“Under [the Ohio Rules of Civil Procedure], a plaintiff is not 
required to prove his or her case at the pleading stage”). 
 
Hafford, 2014-Ohio-739, at ¶ 14. 
Civ.R. 10 Is Inapplicable 
{¶ 14} While not addressed in the court of appeals’ opinion, Wells Fargo 
addresses Civ.R. 10(D) in its brief, and both parties addressed it at oral argument.  
Consequently, we address Civ.R. 10(D) in our analysis to clarify that it has no 
role in resolving whether Wells Fargo has standing in this case. 
{¶ 15} Civ.R. 10(D)(1) states that when a claim or defense is based on an 
account or other written instrument, a party must attach a copy of the account or 
written instrument to the pleading.  And some appellate courts have held that 
Civ.R. 10(D) requires a plaintiff seeking foreclosure to attach documentation 
regarding the loan.  See, e.g., Beneficial Mtge. of Ohio v. Jacobs, 2d Dist. Clark 
No. 01CA0080, 2002-Ohio-3162, ¶ 10 (Civ.R. 10(D) “requires copies of the 
mortgage deeds and notes to be attached to complaints in foreclosure”). 
 
January Term, 2015 
 
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{¶ 16} However, failing to attach documents to a complaint pursuant to 
Civ.R. 10(D)(1) does not equate to a lack of standing.  A defendant’s recourse for 
such a failure is to file a motion for a more definite statement under Civ.R. 12(E).  
Fletcher v. Univ. Hosps. of Cleveland, 120 Ohio St.3d 167, 2008-Ohio-5379, 897 
N.E.2d 147, ¶ 11.  Moreover, Civ.R. 10(D) does not apply to the instant case, 
because the issue addressed by the court of appeals and raised in the appeal to this 
court regarding Wells Fargo’s standing is not whether it attached documentation 
regarding the loan but instead goes to whether Wells Fargo is the successor in 
interest to Wells Fargo Home Mortgage, Inc., and Norwest Mortgage, Inc. 
IV. Conclusion 
{¶ 17} Accordingly, we hold that although the plaintiff in a foreclosure 
action must have standing at the time suit is commenced, proof of standing may 
be submitted subsequent to the filing of the complaint. 
{¶ 18} At oral argument, Horn asserted that there were no allegations in 
Wells Fargo’s complaint asserting that it was the successor in interest to Norwest 
Mortgage, Inc.  However, the complaint needed only to set forth a short and plain 
statement of the claim showing that Wells Fargo was entitled to relief.  Civ.R. 
8(A).  The complaint’s allegation that Wells Fargo was the holder of the Horns’ 
note was sufficient to show for pleading purposes that Wells Fargo was the real 
party in interest and that it was arguably entitled to a decree of foreclosure.  See 
JPMorgan Chase Bank, Natl. Assn. v. Fallon, 4th Dist. Pickaway No. 13CA3, 
2014-Ohio-525, ¶ 12-13 (The holder of a note has the right to enforce the note if 
the note is endorsed to that holder or it is endorsed in blank). 
{¶ 19} After filing the complaint, Wells Fargo submitted proof of standing 
regarding the fact that it was the real party in interest through an affidavit and 
other documents attached to its motion for summary judgment.  Its affiant, a 
“Default Litigation Specialist” for Wells Fargo, averred that in 2000, Norwest 
Mortgage, Inc., changed its name to Wells Fargo Home Mortgage, Inc., and in 
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2004, Wells Fargo Home Mortgage, Inc., merged into Wells Fargo, the plaintiff 
here.  Documents attached to the motion for summary judgment confirmed the 
name change and merger and the timing of each event.  These materials verified 
that Wells Fargo had standing to file the foreclosure action against the Horns at 
the time that it filed the complaint in 2010. 
{¶ 20} Therefore, we reverse the judgment of the court of appeals, 
reinstate Wells Fargo’s foreclosure action, and remand the cause to the court of 
appeals to resolve Horn’s assignments of error that were never addressed. 
Judgment reversed 
and cause remanded. 
O’CONNOR, C.J., and PFEIFER, O’DONNELL, LANZINGER, FRENCH, and 
O’NEILL, JJ., concur. 
___________________________ 
Thompson Hine, L.L.P., Scott A. King, and Terry W. Posey Jr., for 
appellant. 
Kendo, Alexander, Cooper & Engel, L.L.P., Andrew M. Engel, Christine 
M. Cooper, and Chad D. Cooper, for appellee. 
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