[Cite as U.S. Bank Natl. Assn. v. George, 2016-Ohio-7788.]

IN THE COURT OF APPEALS OF OHIO 

TENTH APPELLATE DISTRICT 

U.S. Bank National Association, : 

as Trustee, Successor in Interest to 

Wachovia Bank, National Association as : 

Trustee for Wells Fargo Asset Securities 

Corporation, Mortgage Pass-Through : No. 14AP-817 

Certificates, Series 2003-D, (C.P.C. No. 12CV-13226)

 : 

 Plaintiff-Appellee, (REGULAR CALENDAR) 

 : 

v. 

 : 

Douglas K. George et al., 

 : 

 Defendants-Appellants, 

 : 

Westbury Homeowners' 

Association, Inc. et al., : 

 Defendants-Appellees. : 

 

D E C I S I O N 

Rendered on November 17, 2016 

 

On brief: Thompson Hine LLP, Scott A. King, and Terry W. 

Posey, Jr., for appellee U.S. Bank National Association. 

On brief: McGookey Law Offices, LLC, Daniel L. 

McGookey, Kathryn M. Eyster, and Lauren E. McGookey, 

for appellants. 

 

ON MOTION FOR RECONSIDERATION 

BRUNNER, J. 

{¶ 1} Plaintiff-appellee, U.S. Bank National Association ("U.S. Bank"), as trustee, 

successor in interest to Wachovia Bank, National Association ("Wachovia"), as trustee for 

the Wells Fargo Asset Securities Corporation, mortgage pass-through certificates, series 

2003-D (the "trust"), requests that we reconsider our decision issued December 3, 2015, 
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No. 14AP-817 

reversing summary judgment by the Franklin County Court of Common Pleas in an action 

filed against defendants-appellants, Douglas K. and Robin A. George, for the balance due 

on a promissory note and to foreclose a mortgage against real property located at 7511 

Windsor Drive, Dublin, Ohio 43016, which secured repayment of the note. For the 

reasons stated in this decision, we overrule the motion for reconsideration. 

I. FACTS AND PROCEDURAL HISTORY 

{¶ 2} The crux of the motion for reconsideration is U.S. Bank's assertion that the 

"[o]pinion did not address the evidence that U.S. Bank was a non-holder in possession 

with the rights of a holder" and that because it did not do so, our decision contained 

error. (Emphasis added.) (Dec. 14, 2015 Mot. for Recons. at 2.) We note from the record 

that U.S. Bank argued the point in its brief but, on summary judgment before the trial 

court, it argued standing generally and stated, "[p]laintiff contends that the right to 

enforce the note * * * provides it with standing in the foreclosure case. A promissory note 

is a negotiable instrument." (Mar. 18, 2014 Pl.'s Reply to Defs.' Memo. in Opp. to Mot. for 

Summ. Jgmt. at 10.) It was more so the Georges in their memorandum contra summary 

judgment who addressed U.S. Bank's late-emphasized contentions that they held standing 

as a nonholder in possession with rights of a holder. In opposing summary judgment 

before the trial court, the Georges cited and quoted from U.S. Bank, N.A. v. Coffey, 6th 

Dist. No. E-11-026, 2012-Ohio-721, positing that U.S. Bank had to be either a holder of the 

note or a nonholder with right of possession, and as such, they argued that U.S. Bank was 

not a person entitled to enforce the note. (Mar. 7, 2014 Defs.' Memo. in Opp. to Pl.'s Mot. 

for Summ. Jgmt. at 19.) We could question whether U.S. Bank's arguments in its brief on 

its asserted standing as a nonholder in possession with rights of a holder can be the 

subject of a motion for reconsideration. But, on a review of the record, we find that the 

issue was tangentially argued before the trial court and we address the issue in this 

decision on reconsideration. 

{¶ 3} We have set forth the overall background facts of this case in detail in our 

prior decision and refer to the details of that decision for a complete factual recitation. 

U.S. Bank, N.A. v. George, 10th Dist. No. 14AP-817, 2015-Ohio-4957, ¶ 1-7 ("George I"). 

For clarity of discussion on our decision on U.S. Bank's motion for reconsideration, we 

point to the facts salient to U.S. Bank's motion as they exist in paragraphs six and seven of 

George I. The evidence documenting U.S. Bank's interest in the note for the Georges' 
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No. 14AP-817 

debt that is secured by the mortgage on their property "is not identical to the note 

attached to the complaint and the amended complaint * * *. In her affidavit, Jones 

attested to this documentation by stating: 'Attached as exhibits hereto are copies of the 

Note with any applicable indorsements and the Mortgage with any applicable 

Assignments, a payment history and the demand letter, redacted solely to protect any 

private, personal, financial information.' (Jones Affidavit, ¶ 9.)" Id. at ¶ 6. 

{¶ 4} The copy of the note attached to Jones' affidavit contained the first 

indorsement by M/I Financial Corp. ("M/I Financial") to Wells Fargo Home Mortgage, 

Inc. ("WFHMI") but omitted the further indorsement to Wachovia and the allonge 

bearing the indorsement to U.S. Bank. Attempting to correct the discrepancy, on 

October 21, 2013, U.S. Bank filed a motion to incorporate in which its counsel stated that 

"through inadvertence a full copy of the Promissory Note, which was attached to the 

Complaint, was not attached to [U.S. Bank]'s Motion for Summary Judgment." According 

to George I, U.S. Bank moved for an order "incorporating" the full copy. Id. at ¶ 7. The 

motion to incorporate was granted by the trial court the same day it was filed. However, 

while counsel stated that the full copy was attached to the motion to incorporate, the 

supposed attachment is not in the record, and thus, nothing appears to have been 

incorporated. Over the Georges' opposition, the trial court granted U.S. Bank's motion for 

summary judgment. 

{¶ 5} On appeal, the Georges asserted a single assignment of error: 

The trial court erred in granting U.S. Bank's Motion for 

Summary Judgment. 

Id. at ¶ 1. We sustained this assignment for the reasons set forth in George I. The 

Franklin County Clerk of Courts dispatched a notice regarding the entry of judgment 

associated with the decision on December 3, 2015. 

{¶ 6} On December 14, 2015, U.S. Bank filed a motion for reconsideration arguing 

that we should reconsider certain aspects of George I. 

II. MOTION FOR RECONSIDERATION 

{¶ 7} A motion for reconsideration of a state court appellate decision is reviewed 

for "whether the motion calls to the attention of the court an obvious error in its decision 

or raises an issue for consideration that was either not considered at all or was not fully 
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No. 14AP-817 

considered by the court when it should have been." Matthews v. Matthews, 5 Ohio 

App.3d 140 (10th Dist.1981), paragraph two of the syllabus (construing App.R. 26). 

{¶ 8} U.S. Bank argues that we did not address evidence that it was a nonholder 

in possession with rights of a holder in George I. And specifically, U.S. Bank asserts that 

the following evidence is undisputed: (1) on August 8, 2002, the Georges executed the 

note and mortgage in favor of M/I Financial, citing the amended complaint and the 

affidavit of Megan A. Jones at paragraph 3-4, attached to U.S. Bank's motion for summary 

judgment, (2) on August 8, 2002, M/I Financial executed an assignment of mortgage to 

WFHMI assigning the mortgage "together with the notes and indebtedness thereby 

secured," citing exhibit D to the amended complaint, (3) on September 17, 2009, Wells 

Fargo Bank, N.A., successor by merger with WFHMI, executed an assignment of the 

mortgage to U.S. Bank, assigning the mortgage, "together with the Promissory Note 

secured thereby and referred to therein, and all sums of money due," citing exhibit F to 

the amended complaint, (4) at the time of filing the complaint through the dates of Jones' 

affidavit, U.S. Bank alleges that, "directly or through an agent," it "had and has been in 

possession of the Note," citing paragraph 5 of the Jones affidavit, and (5) the original note 

was produced at a deposition of U.S. Bank's corporate representative, citing exhibit T to 

the motion for summary judgment, the deposition of John McCray, at paragraph 32-33. 

{¶ 9} U.S. Bank argues the Court's holding in George I that the evidence was 

insufficient to show that U.S. Bank was a nonholder in possession and thereby was not 

entitled to enforce its alleged interest in the note and mortgage, "ignored both the record 

evidence and is legally incorrect." (Dec. 14, 2015 Memo. in Support of Mot. For Recons. at 

5.) U.S. Bank went on to state in its motion that: 

Under R.C. 1303.31(A)(2) , a "nonholder in possession of the 

instrument who has the rights of a holder" can enforce the 

instrument. Like holders, nonholders must have possession. 

However, unlike holders (who need to only have possession), 

nonholders must also have independent evidence of transfer 

of the instrument by someone who had the right to transfer it. 

R.C. 1303.22 . 

 (Emphasis sic.) Id. at 5-6. 

{¶ 10} We agree with this statement of law, but, in applying it to the record, we 

reject U.S. Bank's arguments that there was no material issue of fact that U.S. Bank was a 
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No. 14AP-817 

party entitled to enforce the note on the basis that it was a "non-holder in possession with 

the rights of a holder." Id. at 10. U.S. Bank requests that we adopt decisions from the 

Eighth, Fifth, Twelfth and Second District Courts of Appeals that have "applied R.C. 

1303.31(A)(2), finding that possession of the promissory note when combined with 

evidence of a 'transfer' is sufficient to establish a party's status as a 'party entitled to 

enforce,' under R.C. 1303.31." (Memo. in Support of Mot. for Recons. at 6.) Thereafter, 

U.S. Bank cites R.C. 1303.22(B) containing language that, " '[t]ransfer of an instrument, 

whether or not the transfer is a negotiation, vests in the transferee any right of the 

transferor to enforce the instrument.' " Id. at 6-7. In reviewing U.S. Bank's arguments, we 

find no basis to reverse our prior decision. 

A. The Record 

{¶ 11} U.S. Bank filed its complaint in the trial court as "U.S. Bank, National 

Association, as Trustee, Successor in Interest to Wachovia Bank, National Association as 

Trustee for the Wells Fargo Asset Securities Corporation, Mortgage Pass-Through 

Certificates, Series 2003-D." (Oct. 19, 2012 Compl. at 1.) The original holder of the note 

was M/I Financial who, on the date of its making (at the closing for the Georges' real 

estate purchase of their home), indorsed the note to WFHMI. Thereafter, the note was 

indorsed to Wachovia "[a]s Trustee under the pooling and servicing agreement dated * * * 

February 26, 2003." (Ex. A at 5, Compl.) The allonge to the note was endorsed by Wells 

Fargo Bank, N.A. as WFHMI's attorney in fact to U.S. Bank as "successor in interest to 

Wachovia Bank * * * as trustee." (Emphasis omitted.) (Ex. A at 6, Compl.) 

{¶ 12} That Wells Fargo Bank, N.A. was the survivor of a merger with WFHMI is 

not established by the record. There is no certificate of merger between them appearing in 

the record.1 See CitiMortgage, Inc. v. Guinther, 10th Dist. No. 12AP-654, 2013-Ohio4014, ¶ 16-20 (holding a merger certificate as sufficient evidence of a merger). The 

Assignment of Mortgage, Jones' affidavit, Preliminary Judicial Report, and various 

pleadings assert that Wells Fargo Bank, N.A. is the successor by merger to WFHMI, but 

there is no evidentiary-quality material in the record such as a certificate of merger that 

supports this. Nor does Jones in her affidavit establish personal knowledge of the merger. 

Even though McCray insisted in his deposition that Wells Fargo Bank, N.A. was the 

 

1 The Georges, in their memorandum in opposition to summary judgment, argued at length that summary 

judgment should not be granted because Wells Fargo Bank, N.A. had failed to show evidence of a merger. 
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No. 14AP-817 

successor to both WFHMI and Wachovia, he admitted that there were no documents in 

the record to confirm this. 

"[W]hen a merger between two companies occurs, one of 

those companies ceases to exist: '[A] merger involves the 

absorption of one company by another, the latter retaining its 

own name and identity, and acquiring the assets, liabilities, 

franchises and powers of the former. Of necessity, the 

absorbed company ceases to exist as a separate business 

entity.' " Acordia of Ohio, L.L.C. v. Fishel, 133 Ohio St.3d 345, 

2012 Ohio 2297, ¶ 12, 978 N.E.2d 814 ("Acordia I"), quoting 

Morris v. Invest. Life Ins. Co., 27 Ohio St.2d 26, 31, 272 

N.E.2d 105 (1971). "[T]he absorbed company becomes a part 

of the resulting company following merger [and] the merged 

company has the ability to enforce * * * agreements as if the 

resulting company had stepped in the shoes of the absorbed 

company." Acordia of Ohio, L.L.C. v. Fishel, 133 Ohio St.3d 

356, 2012 Ohio 4648, ¶ 7, 978 N.E.2d 823 ("Acordia II"). 

Moreover, "in accordance with R.C. 1701.82(A)(3) , all assets 

and property, including employment contracts and 

agreements, and every interest in the assets and property of 

each constituent entity transfer through operation of law to 

the resulting company postmerger." Acordia II at ¶ 3. 

Fid. Tax, LLC v. Hall, 10th Dist. No. 12AP-923, 2013-Ohio-3165, ¶ 18; compare Guinther

at ¶ 18-19 with Beneficial Fin. I v. Gales, Franklin C.P. No. 14CVE-01-1799 (Oct. 2, 2015). 

In the instance of a merger, in this case between WFHMI and Wells Fargo Bank, N.A., a 

certificate of merger would help to prove the transfer of the right to enforce the Georges' 

note in the entire chain of transfers from the original obligee to U.S. Bank. But the state of 

the evidence in this case does not present a clear picture that U.S. Bank has the rights of a 

holder. 

{¶ 13} Even if McCray's testimony were sufficient evidence of the merger, which 

we find that it was not, especially since U.S. Bank conceded in its reply on summary 

judgment that McCray lacked personal knowledge, WFHMI had indorsed the Georges' 

note to Wachovia as trustee under a pooling agreement before the date of the purported 

merger between WFHMI and Wells Fargo Bank, N.A. (Pl.'s Reply to Defs.' Memo. in Opp. 

to Mot. for Summ. Jgmt. at 6-7.) There was no evidence in the record (1) that Wells Fargo 

Bank, N.A. was not bound by what WFHMI could have done regarding that transaction 

and (2) of the effect of WFHMI's indorsement of the Georges' note to Wachovia as 
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No. 14AP-817 

trustee; that is, whether WFHMI retained the ability to further negotiate and indorse the 

note (and thus whether Wells Fargo Bank, N.A. had that power). And no evidence of the 

terms of the pooling agreement appears in the record such that U.S. Bank could show it is 

the holder of the Georges' note without the indorsement by the trustee Wachovia in favor 

of U.S. Bank. 

{¶ 14} U.S. Bank argued in its reply on summary judgment that the Georges lacked 

standing "to challenge violations of the trust prospectus" and that "[c]ourts have 

determined that pooling and servicing agreements concern mortgage loans, not 

mortgages," citing Bank of N.Y. Mellon v. Baird, 2d Dist. No. 2012-CA-28, 2012-Ohio4975 (other citations omitted). We do not adhere to holdings that purport to prevent 

foreclosure defendants from pointing out that a plaintiff's proof falls short of establishing 

an entitlement to enforce.2 In having overruled LSF6 Mercury REO Invests. Trust Series 

2008-1 v. Locke, 10th Dist. No. 11AP-757, 2012-Ohio-4499, in George I, we clarify this 

point as part of our decision on U.S. Bank's motion for reconsideration. It is incumbent 

on a party seeking to enforce a debt evidenced by a note and secured by a mortgage to 

demonstrate with evidentiary-quality materials that it has standing in order to attain 

 

2 An example of a holding we reject is: 

[A] plaintiff mortgagor is not a party to, or beneficiary of, the agreement 

that governs the trust to which the mortgagor's debt instrument has been 

transferred and, therefore, does not have standing to challenge that 

agreement. See, e.g., Nelson v. Bank of N.Y. Mellon, Civ. No. 12-1096 

(SRN/SER), 2012 U.S. Dist. LEXIS 141277, 2012 WL 4511165, at *3 (D. 

Minn. Oct. 1, 2012) ("Moreover, Plaintiffs were not parties to the pooling 

and servicing agreements by which their notes were pooled into mortgagebacked securities. They therefore do not have standing to challenge those 

agreements.") (citation omitted); Anderson v. Countrywide Home Loans, 

Civ. No. 10-2685 (MJD/JJG), 2011 U.S. Dist. LEXIS 45966, 2011 WL 

1627945, at *4 (D. Minn. Apr. 8, 2011) ("Plaintiffs do not have standing to 

challenge the validity of the assignment to the Trust because they are not 

parties to the PSA."), Report and Recommendation adopted by 2011 U.S. 

Dist. LEXIS 45957, 2011 WL 1630113, at *1 (D. Minn. Apr. 28, 2011); 

Greene v. Home Loan Servs., Inc., Civ. No. 09-719 (DWF/JJK), 2010 U.S. 

Dist. LEXIS 99222, 2010 WL 3749243, at *4 (D. Minn. Sept. 21, 2010) 

("Even assuming this matter was adequately pleaded, which it was not, 

Plaintiffs are not a party to the Pooling and Servicing Agreement and 

therefore have no standing to challenge any purported breach of the rights 

and obligations of that agreement."). 

Rogers v. Bank of Am., N.A., D.Minn. No. 13-cv-1698 (July 1, 2014). See also, Bond v. Barrett Daffin 

Frappier Turner & Engel, LLP, S.D.Tex. No. G-12-188 (Mar. 22, 2013), adopted by, motion granted by, 

dismissed by Bond v. Barrett Daffin Frappier Turner & Engel, LLP, S.D.Tex. No. 3:12-cv-188 (Apr. 17, 

2013). 
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No. 14AP-817 

summary judgment in its favor. George I. Without evidentiary-quality materials 

supporting the valid and continuous chain of transfers of the instrument on which relief is 

based, there is no basis for a judgment. Here, U.S. Bank could not show that it was either 

a holder or a nonholder with rights of possession because U.S. Bank has not shown a valid 

and continuous chain of transfers linking it to the original obligee on the note. 

{¶ 15} As we stated in George I, a valid transfer involves negotiation and 

endorsement under the Uniform Commercial Code ("UCC"). 

Under Ohio law, the right to enforce a note cannot be 

assigned; rather, the note must be negotiated in conformity 

with Ohio's version of the Uniform Commercial Code. In re 

Wells, 407 B.R. 873, 880 (N.D.Ohio 2009). See also HSBC 

Bank USA, Natl. Assn. v. Surrarrer, 8th Dist. No. 100039, 

2013-Ohio-5594, ¶ 17 (in order for one other than the payee 

to enforce the note, the note must be negotiated to another 

who then becomes the holder of the note). An attempt to 

assign a note creates a claim to ownership, but does not 

transfer the right to enforce the note. Wells at 880. An 

assignment of a note may be by negotiation, pursuant to R.C. 

1303.21 , or transfer pursuant to R.C. 1303.22 . "Negotiation" 

requires transfer of possession of the instrument. R.C. 

1303.21(A). The "transfer" of an instrument requires physical 

delivery of the note "for the purpose of giving to the person 

receiving delivery the right to enforce the instrument." R.C. 

1303.22(A). 

Wells Fargo Bank, N.A. v. Byers, 10th Dist. No. 13AP-767, 2014-Ohio-3303, ¶ 16. A 

continuous chain of transfer shows a series of valid transfers between each and every 

person entitled to enforce the note supported by evidentiary-quality proof for each person 

so as not to break the chain. 

{¶ 16} The Georges disputed that Wells Fargo Bank, N.A. was entitled to execute 

the allonge and, thereby, disputed U.S. Bank as the note's holder, a material issue of fact 

relating to U.S. Bank's standing. R.C. 1301.201(B)(21)(a) and former R.C. 

1301.01(T)(1)(a) and (b). The issue of U.S. Bank's standing to bring the action was 
9 

No. 14AP-817 

squarely addressed by both parties on summary judgment before the trial court.3 As we 

stated in George I, Jones' affidavit was deficient. It did not specifically set forth the 

transfers of the note and mortgage but, rather, addressed the transfers in the barest of 

generalities with this language: " '[a]ttached as exhibits hereto are copies of the Note with 

any applicable indorsements and the Mortgage with any applicable Assignments, * * * 

redacted solely to protect any private, personal, financial information.' " George I at ¶ 6, 

citing Jones' Aff. at ¶ 9. There existed in the record no certificate of merger, and the 

testimony of McCray was not reliable evidence of such a merger. The record did not 

support the authority of Wells Fargo Bank, N.A. to indorse the note indorsed to Wachovia 

to U.S. Bank. 

B. The Original Note 

{¶ 17} U.S. Bank's contention that "the evidence was undisputed that U.S. Bank 

had possession of the original Note" because it was putatively produced at deposition is 

not established by our decision. (Memo. in Support of Mot. for Recons. at 7.) No 

stipulations of the parties exist to support this assertion. What we did state in our 

decision is that: 

The trial court further relied on appellee's production of what 

was represented as the original note at the Civ.R. 30(B)(6) 

deposition of its representative, John McCray, with the 

indorsements and allonges, as in the copies attached to its 

pleadings. * * * A plaintiff moving for summary judgment in 

a foreclosure action must submit evidentiary-quality 

materials. 

(Emphasis added.) George I at ¶ 17. At no point did we discuss in our decision whether 

this evidence was disputed. Nor did we find in our de novo review that U.S. Bank had 

possession of the original note. We cannot say whether the original note is in the record. 

The affidavit of Jones identifying a note and mortgage is so oblique as to be nonspecific. 

And there exists in the record unexplained discrepancies between the version of the note 

attached to both the complaint and amended complaint and to Jones' affidavit in support 

of the motion for summary judgment. The records custodian, McCray, at his deposition 

had no knowledge of where the purported original note was kept. Nor could he testify to 

 

3 "Plaintiff contends that the right to enforce the note * * * provides it with standing in the foreclosure case. 

A promissory note is a negotiable instrument." (Pl.'s Reply to Defs.' Memo. in Opp. to Mot. for Summ. Jgmt. 

at 10.) 
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No. 14AP-817 

any semblance of a chain of custody as to how the purported original note came to be at 

the deposition for his identification of it. He had no knowledge of when the allonge to the 

note was made or how it came to be attached to what was purported to be the original 

note. For U.S. Bank to state that our decision established that it was undisputed that U.S. 

Bank had possession of the original note is not supported by either the record or the plain 

language of our decision. It is a mischaracterization that, at best, pushes the envelope. It 

would be impossible for the trial court or this Court to find from the record that (1) it is 

undisputed that U.S. Bank had possession of the original note or that (2) U.S. Bank is a 

holder of the Georges' note or a nonholder in possession with rights of a holder for the 

purposes of granting summary judgment as U.S. Bank argues. 

{¶ 18} In fact, the trial court erroneously made findings in its summary judgment 

decision that were based on a failure to construe the evidence in a light most favorable to 

the Georges as is required by Civ. R. 56(C) and controlling law. The trial court stated, 

"[i]n the case at hand, the Court finds that Plaintiff has presented evidence that it is in 

possession of the Note. * * * Finally, as stated above, Defendants were presented with the 

original Note * * * during the deposition of Mr. McCray." (Aug. 15, 2014 Decision 

Granting Pl.'s Mot. for Summ. Jgmt. at 7-8.) As noted earlier, the evidence showed, and 

even U.S. Bank conceded, that McCray lacked personal knowledge as a mere keeper of the 

records. In George I at ¶ 8 and in previous decisions, we have held that this type of 

factfinding on summary judgment is not permitted. Rather: 

In ruling on a motion for summary judgment, the court must 

resolve all doubts and construe the evidence in favor of the 

nonmoving party. Pilz v. Ohio Dept. of Rehab. & Corr., 10th 

Dist. No. 04AP-240, 2004-Ohio-4040, P 8. See also Hannah 

v. Dayton Power & Light Co., 82 Ohio St.3d 482, 485, 1998 

Ohio 408, 696 N.E.2d 1044 (1998) ("Even the inferences to be 

drawn from the underlying facts contained in the 

evidentiary materials, such as affidavits and depositions, 

must be construed in a light most favorable to the party 

opposing the motion.")

(Emphasis added.) Deutsche Bank Natl. Trust Co. v. Thomas, 10th Dist. No. 14AP-809, 

2015-Ohio-4037, ¶ 8. U.S. Bank's arguments on the original note lack merit. 
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No. 14AP-817 

C. Whether U.S. Bank was a Holder of the Note or Was a Nonholder in 

Possession of the Note with the Rights of a Holder 

{¶ 19} Regardless whether U.S. Bank was able to prove that it had possession of 

the original note, for U.S. Bank to qualify as a "holder" of the note (and thereby be a 

person entitled to enforce the instrument as set forth in R.C. 1303.31(A)(1)), it must have 

both possession of the note, and the note must be indorsed either in blank to the bearer or 

specifically to the one presenting it (U.S. Bank). See former R.C. 1303.01(T)(1)(a) and (b) 

(2002) (currently set forth in R.C. 1301.201(B)(21)(a)). U.S. Bank urges that we adopt a 

holding that essentially permits a transferee of a note to gain the rights of a holder without 

negotiation or indorsement and without other circumstances that by operation of law 

would affect a transfer of a note from one holder to another (such as a merger) and 

otherwise without separate negotiation and indorsement. Thus, U.S. Bank argues that 

indorsement is not necessary to qualify as a holder and that mere possession alone is all 

that is needed to qualify as a holder under R.C. 1303.31(A)(2) and 1301.201(B)(21)(a). 

{¶ 20} U.S. Bank states correctly the proposition that a person entitled to enforce 

an instrument, in addition to being a holder, can be " 'a nonholder in possession of the 

instrument who has the rights of a holder.' " (Emphasis added.) (Memo. in Support of 

Mot. for Recons. at 5, citing R.C. 1303.31(A)(2).) However, we cannot adopt U.S. Bank's 

argument that it somehow becomes a "holder" of the Georges' note by operation of R.C. 

1303.22(A) and (B). R.C. 1303.22(A) defines when a "transfer" occurs ("when it is 

delivered by a person other than its issuer for the purpose of giving to the person receiving 

delivery the right to enforce the instrument"). R.C. 1303.22(B) provides that "[t]ransfer of 

an instrument, whether or not the transfer is a negotiation, vests in the transferee any 

right of the transferor to enforce the instrument, including any right as a holder in due 

course." 

{¶ 21} It appears that U.S. Bank conflates "transferee" with "holder" to leap-frog 

over holes in the chain of transfer that are not supported in the record by evidentiaryquality materials. Under either R.C. 1303.22(A) or (B), a transferee gets only what the 

transferor had to give, no matter the intention or purpose of the transferor. R.C. 

1303.22(A) does not magically transform a note's "transfer" to "rights of a holder." This 

is especially true, since R.C. 1303.22(B) limits the rights of the transferee to the rights 

held by the transferor. Thus, if Wells Fargo Bank, N.A. was not a "holder" or a "person 
12 

No. 14AP-817 

entitled to enforce" the Georges' note, neither is U.S. Bank. R.C. 1303.22(B). Even 

looking to R.C. 1303.31(B), where a transferee may have wrongly received the note (such 

as a transferor purporting to transfer "right to enforce" it under R.C. 1303.22(A)), we 

must consider other provisions of the UCC, such as R.C. 1301.304, which requires that 

"[e]very contract or duty within Chapters 1301., 1302., 1303., 1304., 1305., 1307., 1308., 

1309., and 1310. of the Revised Code imposes an obligation of good faith in its 

performance and enforcement."4 

{¶ 22} U.S. Bank claims it is a nonholder in possession with the rights of a holder 

(R.C. 1303.31(A)(2)) by means of Wells Fargo Bank, N.A.'s transfer of the Georges' note to 

it, also based on its previously asserted interpretation of R.C. 1303.22(A) and (B). Under 

no set of facts evidenced by the record can we find as a matter of law that U.S. Bank is 

either a holder or a person entitled to enforce the Georges' note. U.S. Bank did not show 

with evidentiary-quality materials that Wells Fargo Bank, N.A., one of the note's 

purported predecessors in interest, was either a holder or a person entitled to enforce the 

Georges' note. R.C. 1301.201(B)(21) (and former R.C. 1301.01(T)(1)(a) and (b)) 

specifically define "holder" as "[t]he person in possession of a negotiable instrument that 

is payable either to bearer or to an identified person that is the person in possession." No 

certificate of merger appears in the record between WFHMI and Wells Fargo Bank, N.A. 

No evidence appears in the record of Wells Fargo Bank, N.A.'s authority to negotiate 

(evidenced by indorsement of) the Georges' note from the Wachovia trust it had been 

indorsed to by WFHMI before its merger with Wells Fargo Bank, N.A. There is 

insufficient evidence in the record to support a finding that Wells Fargo, N.A. was a 

"person entitled to enforce"5 the Georges' note, as a holder, or as a nonholder in 

possession of the instrument who has the rights of a holder or otherwise. R.C. 1303.31(A).

{¶ 23} U.S. Bank further requests this Court to adopt its interpretation of R.C. 

1303.22(A) and (B) in support of its claim that it gains the rights of a holder simply by a 

 

4 R.C. 1301.304 applies to R.C. Chapter 1303, because R.C. 1303.01(D) acknowledges that, "[i]n addition, 

Chapter 1301. of the Revised Code contains general definitions and general principles of construction and 

interpretation applicable throughout this chapter." 

5 R.C. 1303.31(A) defines a "[p]erson entitled to enforce" a negotiable instrument as a "holder," a 

"nonholder in possession of the instrument who has the rights of a holder" or "[a] person not in possession 

of the instrument who is entitled to enforce the instrument" because the instrument has been destroyed or 

wrongfully executed by mistake, even if the person is not the owner of the instrument or is in wrongful 

possession of the instrument. R.C. 1303.31(B). 
13 

No. 14AP-817 

transfer—without negotiation and indorsement—of what is purported to be the Georges' 

original note based on Wells Fargo Bank, N.A.'s purported status as a person entitled to 

enforce the Georges' note. Were we to adopt U.S. Bank's argument, based on its 

interpretation and application of R.C. 1303.22(A) and (B), the result would be to 

eviscerate the Georges' and others' ability to challenge any transfers of the note and 

mortgage in defense of an action to enforce a note and a foreclosure action in equity. Such 

an interpretation misapplies the application of the UCC to the negotiation of the 

instruments at issue. U.S. Bank's argument that Wells Fargo Bank, N.A.'s transfer to it did 

not require negotiation and that the simple act of a physical transfer suffices to make U.S. 

Bank a nonholder in possession with rights of a holder, is not supported by the record or 

the UCC. If an instrument is payable to bearer, it may be negotiated by transfer of 

possession alone. But the record is clear that the Georges' note is not a bearer note. 

{¶ 24} Under U.S. Bank's theory, negotiation and indorsement no longer matter. 

But under this theory, neither would the Uniform Commercial Code. Yet, U.S. Bank 

argues UCC definitions support its contention that no negotiation is needed of the 

Georges' note by Wells Fargo Bank, N.A. to U.S. Bank (even though it is not a bearer 

note), arguing the definition of "parties." R.C. 1303.31(A)(2). "Parties" under the UCC are 

persons that have "engaged in a transaction or made an agreement subject to Chapters 

1301., 1302., 1303., 1304., 1305., 1307., 1308., 1309., and 1310. of the Revised Code." 

R.C. 1301.201(B)(26). U.S. Bank uses the UCC on the one hand to exempt it from 

negotiation of the Georges' note but ignores cardinal rules of Article 3 of the UCC on 

entitlement to enforce a note. Simple transfer does not make one a holder or nonholder 

in possession with rights of a holder status unless the note is a bearer note. In the face of 

uncontroverted evidence that the Georges' note is not a bearer note, U.S. Bank's argument 

fails. 

{¶ 25} The UCC provides that, "[u]nless otherwise agreed, if an instrument is 

transferred for value the transferee has a specifically enforceable right to the unqualified 

indorsement of the transferor, but negotiation of the instrument does not occur until the 

indorsement is made by the transferor." (Emphasis added.) R.C. 1303.22(C). There is 

no evidence in the record that the transfer of the Georges' note between Wells Fargo 

Bank, N.A. and U.S. Bank was not for value or that there was an agreement otherwise 
14 

No. 14AP-817 

between U.S. Bank and Wells Fargo Bank, N.A. dispensing with it. There is no evidence in 

the record that prior transfers of the note were not for value or that there was an 

agreement otherwise between the transferring parties. Absent such evidence, there is a 

specifically enforceable right of indorsement by the transferor for the subsequent 

possessor to be entitled to enforce the note. And R.C. 1303.22(C) specifies that 

negotiation occurs upon indorsement. No indorsements appear as between WFHMI and 

Wells Fargo Bank, N.A. Even assuming their merger would dispense with the 

requirement of negotiation and transfer, there is insufficient evidence of the merger. 

Because WFHMI negotiated and indorsed the Georges' note to the Wachovia trust before 

the alleged merger of WFHMI and Wells Fargo Bank, N.A., the evidence is insufficient to 

support Wells Fargo Bank, N.A.'s status as a person entitled to enforce the Georges' note 

or as a person entitled to negotiate and indorse it to U.S. Bank. 

{¶ 26} Whether or not U.S. Bank proved it had possession of the original note, it 

acknowledges that it also had to establish that it was either a holder of the note or a 

nonholder in possession with rights of a holder. In attempting to meet its legal burden 

under UCC Article 3 (R.C. Chapter 1303, and only UCC Article 3 is properly addressed by 

the parties, there being no relevance here of UCC Article 9) to show its right to enforce the 

note, U.S. Bank did not provide evidentiary-quality materials to the trial court to establish 

its status of being either a holder or a person in possession of the note having the rights of 

a holder. Summary judgment should not have been granted. 

D. Transfer of the Note through Transfer of the Mortgage 

{¶ 27} Because the language in at least one of M/I Financial's two separate 

documents assigning the mortgage to WFHMI also included assignment of its rights in 

the note to WFHMI, with assignment thereafter being made to U.S. Bank by "Wells Fargo 

Bank, N.A. successor by merger to Wells Fargo Home Mortgage, Inc.," U.S. Bank argues it 

is a nonholder in possession of the note with the rights of a holder by virtue of the 

mortgage language. (Ex. E, Compl.) Thus U.S. Bank argues that the chain of assignments 

of the mortgage resulted in assignment of the note. The Georges counter that Wells Fargo 

Bank, N.A. had no authority to assign the mortgage on behalf of WFHMI based on 

analogous arguments relating to the similar assignment of the note. U.S. Bank states that, 

for the purposes of R.C. 1303.31(A)(2), "there did not need to be any indorsements of the 

Note, but only evidence showing that U.S. Bank had possession of the Note and that M/I 
15 

No. 14AP-817 

[Financial] and WFHMI transferred their rights [to the mortgage] to [U.S. Bank]." 

(Emphasis sic.) (Memo. in Support of Mot. for Recons. at 7.) The UCC Article 3 analysis 

we applied to the Georges' note applies to the Georges' mortgage as well. The evidence is 

insufficient to support U.S. Bank's argument that the transfer of the mortgage occurred in 

conformity with the UCC. 

{¶ 28} Not only is the evidence insufficient to support U.S. Bank's argument, but 

recent case law from the Supreme Court of Ohio precludes this argument as a matter of 

law. In Deutsche Bank Natl. Trust Co. v. Holden, __ Ohio St.3d __, 2016-Ohio-4603, the 

plaintiff in foreclosure argued similarly that, under the law, assignment of the mortgage 

resulted in assignment of the note. As the Supreme Court stated in its decision: 

The bank urges the court to adopt the approach of the 

Restatement of the Law 3d , Property (Mortgages) and hold 

that the right to enforce the note also follows from the 

assignment of the mortgage securing it. 

Id. at ¶ 16. The Supreme Court declined to adopt this, holding instead that "[w]e have 

long recognized that an action for a personal judgment on a promissory note and an 

action to enforce mortgage covenants are 'separate and distinct' remedies." Id. at ¶ 25, 

citing Carr v. Home Owners Loan Corp., 148 Ohio St. 1 (1947). Speaking further, the 

Supreme Court specifically negated that argument and specifically related it to standing. 

Parties and courts have seized upon that "failed to establish an 

interest in the note or mortgage" statement in [Fed. Home 

Loan Mtge. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 2012-

Ohio-5017] as establishing that a plaintiff in a foreclosure 

action must have an interest in either the note or the 

mortgage at the time of filing in order to establish standing. 

However, the "or" statement in Schwartzwald was a 

description of the particular facts in that case rather than a 

statement about the requisites of standing. 

Holden at ¶ 31. Accordingly, in accord with the Supreme Court's decision in Holden, we 

deny U.S. Bank's argument that the assignment of the mortgage affected the assignment 

of the note. 
16 

No. 14AP-817 

E. Whether the Court Properly Considered Whether U.S. Bank Was a 

Nonholder in Possession with the Rights of a Holder 

{¶ 29} U.S. Bank argues on reconsideration that the Georges "never argued that 

U.S. Bank could not qualify as a nonholder in possession" and that "the evidence shows 

that U.S. Bank was a nonholder in possession." (Memo. in Support of Mot. for Recons. at 

10.) A nonholder in possession must have the rights of a holder. R.C. 1303.31(A)(2). In 

sections D and E of their appellate brief, the Georges argued that U.S. Bank needed to 

show that it had the rights of a holder, having failed to show evidence of the merger and 

the terms of the trust. The Georges also argued, citing Coffey at ¶ 10, that U.S. Bank had 

not demonstrated that it had obtained the right to enforce their note either as a holder or 

a nonholder in possession. In fact, the Georges' argument before the trial court on this 

point was even more specific than was U.S. Bank's. (Defs.' Memo. in Opp. to Pl.'s Mot. for 

Summ. Jgmt. at 19.) U.S. Bank's argument in this vein lacks merit. 

{¶ 30} Having reviewed U.S. Bank's motion for reconsideration, the Georges' 

response, and U.S. Bank's reply, we remain unconvinced that we made an obvious error 

or failed to fully consider an issue that should have been considered. Our decision in 

George I did not establish that it was undisputed that U.S. Bank had the Georges' original 

note. U.S. Bank's evidence fell short of proving that it was a nonholder in possession with 

the rights of a holder such as would entitle it to summary judgment on the Georges' note 

and mortgage. Moreover, U.S. Bank's conflicting evidence submitted on motion for 

summary judgment as compared with its prior evidence in the record created a genuine 

issue of a material fact—its standing to file suit on the note in the first instance, and to 

thereafter seek its remedy on the mortgage in equity. The trial court erred in granting 

summary judgment on the note and in foreclosure on the mortgage. U.S. Bank is not 

entitled to summary judgment as to either. 

III. CONCLUSION 

{¶ 31} We overrule U.S. Bank's motion for reconsideration. 

Motion for reconsideration denied. 

HORTON, J., concurs. 

DORRIAN, P.J., concurs in judgment only. 

 
17 

No. 14AP-817 

DORRIAN, P.J., concurring in judgment only. 

{¶ 32} I concur in judgment only with the majority's denial of reconsideration 

because I believe that U.S. Bank waived the sole issue that it now argues on 

reconsideration. Additionally, I respectfully write separately to disagree with certain 

analyses contained in the majority opinion on reconsideration not necessary for 

resolution of the issue raised. 

{¶ 33} In order to recover on summary judgment, U.S. Bank had to prove that it 

was the person entitled to enforce the Georges' note. Deutsche Bank Natl. Trust Co. v. 

Holden, __ Ohio St.3d __, 2016-Ohio-4603, ¶ 2, 26-27, 33, 35. The Georges argued on 

appeal that U.S. Bank failed to meet this burden. In response, U.S. Bank contended that it 

qualified as the person entitled to enforce the Georges' note because either (1) it was the 

holder of the note, or (2) it was "[a] nonholder in possession of the [note] who ha[d] the 

rights of a holder." See R.C. 1303.31(A)(1) and (2). We held that, due to the existence of 

genuine issues of material fact regarding which version of the note introduced by U.S. 

Bank was the Georges' original note, U.S. Bank could not establish that it had status as 

either the holder of the note or a nonholder in possession with the rights of a holder 

(hereinafter "nonholder in possession"). U.S. Bank Natl. Assn. v. George, 10th Dist. No. 

14AP-817, 2015-Ohio-4957, ¶ 16, 28, 33-34. 

{¶ 34} Now, on reconsideration, U.S. Bank asserts that our decision did not fully 

consider the evidence that it met the criteria necessary for it to qualify as a nonholder in 

possession. This assertion does not provide a basis for reconsideration. U.S. Bank's 

argument that it is a nonholder in possession deserves no consideration because U.S. 

Bank waived that argument by not raising it before the trial court. 

{¶ 35} As I pointed out in my separate opinion in George, a party who fails to raise 

an argument in the trial court waives his or her right to raise that argument on appeal. Id.

at ¶ 43, fn. 9 (Dorrian, J., concurring in judgment only), citing Niskanen v. Giant Eagle, 

Inc., 122 Ohio St.3d 486, 2009-Ohio-3626, ¶ 34. Consistent with my prior position, I 

disagree with the majority's conclusion that U.S. Bank raised the argument below. Before 

the trial court, U.S. Bank premised its right to enforce the Georges' note only on its 

supposed status as the holder of that note. In their memorandum in opposition to 

summary judgment, the Georges challenged U.S. Bank's proof that it qualified as a holder. 
18 

No. 14AP-817 

Additionally, the Georges sua sponte attacked U.S. Bank's ability to prove that it was a 

nonholder in possession. Despite this attack, U.S. Bank raised no contrary argument in 

its reply brief. U.S. Bank, therefore, waived the argument that it qualified as a nonholder 

in possession, and consideration of the same on appeal was neither warranted nor 

necessary. Likewise, the waived argument does not present a reason for this court to 

grant U.S. Bank reconsideration. 

{¶ 36} Notwithstanding my conclusion that the issue is waived, I write this 

separate concurrence, in part, to disagree with a section of the majority opinion on 

reconsideration that I find particularly troubling in light of prior analyses by this court 

and well-reasoned precedent from other courts. That section begins with the statement 

that this court does not adhere to holdings that prevent homeowners from pointing out 

that a bank's evidence fails to establish entitlement to enforce the note. (See majority 

opinion on reconsideration at ¶ 14.) A footnote following this statement sets forth an 

example of a holding, supposedly rejected by this court, that the majority concludes 

prevents homeowners from pointing out a bank's evidence fails to establish entitlement to 

enforce a note. In short, the holding rejected by the majority provides that when a 

homeowner is not a party to, or beneficiary of, an agreement that governs the trust that 

includes the homeowner's note, the homeowner does not have standing to challenge that 

agreement. 

{¶ 37} I disagree with the majority's assessment of the effect of the holding. A 

homeowner's lack of standing to challenge a trust agreement (also known as a pooling and 

servicing agreement or PSA) does not impede the homeowner from attacking a bank's 

entitlement to enforce the note. Statutes—not trust agreements—set forth the criteria a 

bank must prove to demonstrate that it is the person entitled to enforce the note. See R.C. 

1301.201(B)(21); 1303.21; 1303.22; 1303.31. Consequently, whether a trust agreement is 

valid, and whether the bank complied with the trust agreement, have no relevance in the 

determination of whether the bank is the person entitled to enforce the note. Deutsche 

Bank Natl. Trust Co. v. Sopp, 10th Dist. No. 14AP-343, 2016-Ohio-1402, ¶ 19; Logansport 

Savs. Bank, FSB v. Shope, 10th Dist. No. 15AP-148, 2016-Ohio-278, ¶ 17-18. Contrary to 

the implication in the majority opinion on reconsideration, the rejected holding does not
19 

No. 14AP-817 

prevent homeowners from pointing out that, under the law, a bank's evidence fails to 

establish that it is the person entitled to enforce the note. 

{¶ 38} Furthermore, the majority's rejection of the cited holding contravenes wellreasoned law. See Dauenhauer v. Bank of N.Y. Mellon, 562 Fed.Appx. 473, 480 (6th 

Cir.2014) ("Courts have consistently rejected borrowers' requests to have mortgage 

assignments and foreclosures invalidated due to non-compliance with Pooling and 

Servicing Agreement provisions, based on borrowers' lack of standing."); U.S. Bank Natl. 

Assn. v. Aguilar-Crow, 7th Dist. No. 15 MA 0113, 2016-Ohio-5391, ¶ 67 ("Various courts 

have concluded a debtor lacks 'standing' to challenge whether the transfer of the mortgage 

loan to the trust complied with the pooling and servicing agreement."); HSBC Bank USA 

Natl. Assocs. v. Sherman, 1st Dist. No. C-120302, 2013-Ohio-4220, ¶ 21 ("But [the 

homeowner] is not a beneficiary under the PSA and has no right to claim that [the bank] 

failed to comply with the terms of the PSA."). 

{¶ 39} Finally, I note that the rejection of the cited holding is not necessary for 

resolution of the sole issue raised on reconsideration. See George at ¶ 44 (Dorrian, J., 

concurring in judgment only). 

{¶ 40} In sum, I agree that this court should deny U.S. Bank's application for 

reconsideration, but for a different reason than the majority. Therefore, I respectfully 

concur in judgment only. 

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