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Source of Title Blog

Shockingly Inadequate Argument in Foreclosure Appeal
by Robert Franco | 2013/07/17 |

Apparently, in the underlying foreclosure case the lender sought reformation to correct a typo in the legal description and the homeowner argued that the mistake was not "mutual," therefore the lender was not entitled to reformation and could not foreclose "due to an improper and incorrect legal description."  The trial court granted summary judgment to the lender and the homeowner appealed.

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The court of appeals found that the main issue raised as to the summary judgment was the reformation of the legal description.  The Court then stated the relevant law:

Reformation of an instrument [such as a deed] is an equitable remedy whereby a court modifies the instrument which, due to a mutual mistake on the part of the original parties to the instrument, does not evince the actual intention of those parties.  A person seeking reformation of a written instrument must prove by clear and convincing evidence that the mistake was mutual.


This seems like a favorable recitation of the law for the homeowner.  It is a fairly high burden of proof placed on the lender that it must overcome to have the mortgage reformed; it must prove by clear and convincing evidence that the mistake was mutual.

So what was the mistake that the homeowner had an issue with?  Here is the Court's explanation:

In the case sub judice, the description attached to the mortgage failed to include the term "aluminum" in identifying the type of identification cap used on the survey marker.  The legal description attached to the mortgage at issue currently reads, in pertinent part: "The iron pins set are 19 mm (3/4 inch) diameter rebars; 762 mm (30 inches) in length topped with a 38 mm (1-1/2 inch) diameter identification cap marked 'ODOT R/W, George A. Hofmann, P.S. 7652'".

It is undisputed that the portion of the legal description should read, in pertinent part: "The iron pins set are 19 mm (3/4 inch) diameter rebars; 762 mm (30 inches) in length topped with a 38 mm (1-1/2 inch) diameter aluminum identification cap marked 'ODOT R/W, George A. Hofmann, P.S. 7652'".

The Court found that it was irrelevant whether the mistake was mutual, because the missing word is not material to the legal description.  A mortgage is valid when "in substance" it follows the statutory form: a description of the land or interest in land and encumbrances, reservations, and exceptions, if any.  "In other words, Ohio mortgage law does not set forth a precise legal description that must be included on a mortgage.  A description of legal property is sufficient if it is such as to indicate the land intended to be conveyed, so as to enable a person to locate it."

In this case, the homeowner was unable to show that they were prejudiced by the reformation of the legal description. Therefore, even if the trial court erred by finding "mutual mistake" and granting the reformation claim, it was harmless error. Regardless of the type of metal used on the cap, there was no dispute over the existence or location of the cap.  And there was no demonstration that the mortgage was intended to apply to any property other than that which was the subject of the lender's foreclosure action.

Of course, the court of appeals affirmed the trial court's order granting summary judgment.

This seems to be very close to a frivolous action.  I find it hard to believe that the attorney for the homeowner had any good-faith belief that the law supported his arguments for the appeal.  Perhaps he was taking a flier to try to delay the eviction of his client.  Perhaps, there was good reason to do so.  Perhaps, there is a greater moral good served here than the record reflects.  I'd like to give this attorney the benefit of the doubt.

Motivations aside, I don't think any of us here would object to the sufficiency of the legal description because it did not identify the cap as being made of "aluminum." Now you can "not object" with the certainty and peace of mind that a court agrees with you. 

Nimble Corp. v. Wilson, 2013-Ohio-3112 (5th Dist. 2013).




Categories: General Interest

946 words | 10275 views | 3 comments | log in or register to post a comment

De-volution by bench law?

Seems to me that if the language of the stature is clear and where, here, it places

the burden of proving mutual mistake on the party alleging a mistake is mutual, that should be that. To add language or intent to clear language imo is bench law and it's how real law gets

devolved. That law, by my thinking, says the party asserting mutuality must prove it, not that they don't have to if it isn't material.  

by john gault | 2013/07/19 | log in or register to post a reply

That isn't quite what the court did...

The Court didn't really change the standard or law for reformation.  What the Court was saying was that even if the lower court was wrong in granting the reformation claim, because the lender could not prove (by clear and convincing evidence) that the mistake was mutual, it was a harmless error.

In other words, even if the lender lost the reformation argument, and the legal description was not reformed, the lender could still foreclose because the description - even with the mistake - was still sufficient to identify the property and the mortgage was enforceable.

So, the law of reformation and the requirement that the lender must prove by clear and convincing evidence is still intact.  This case is merely a reminder that you only need reformation when the mistake sought to be corrected is material to the claim or transaction.


by Robert Franco | 2013/07/19 | log in or register to post a reply

I see what you mean

The error in the legal description is what is not material, which in this case, I agree. Therefore, no one had to prove it was a mutual mistake.   

by john gault | 2013/07/19 | log in or register to post a reply
Source of Title Blog

Robert A. FrancoThe focus of this blog will be on sharing my thoughts and concerns related to the small title agents and abstractors. The industry has changed dramatically over the past ten years and I believe that we are just seeing the beginning. As the evolution continues, what will become of the many small independent title professionals who have long been the cornerstone of the industry?

Robert A. Franco



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