mar 2 6 2007 cinfed employees federal credit union, appellant, v. dola jean wooding, appellee, on...

18
IN THE SUPREME COURT OF OHIO Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of Appeals Case No. C-050958 MEMORANDUM IN SUPPORT OF JURISDICTION OF APPELLANT CINFED EMPLOYEES FEDERAL CREDIT UNION C. Edward Noe (0001757) (COUNSEL OF RECORD) Noe & Macleid Co. L.P.A. 2430 Central Parkway Cincinnati, Ohio 45214 (513) 381-7333 Fax No. (513) 381-1390 ednoerc,,one.net COUNSEL FOR APPELLANT CINFED EMPLOYEES FEDERAL CREDIT UNION Dola Jean Wooding Pro Se Litigant 5478 Bahama Terrace, #10 Cincinnati, Ohio 45223 (513) 956-0944 PRO SE LITIGANT MAR 2 6 2007 MARCIA J. MENGEL, CLERK SUPREME COURi OF OHIO

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Page 1: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

IN THE SUPREME COURT OF OHIO

Cinfed Employees FederalCredit Union,

Appellant,

V.

Dola Jean Wooding,

Appellee,

On Appealfrom the HamiltonCounty Court of Appeals,First Appellate District

Court of AppealsCase No. C-050958

MEMORANDUM IN SUPPORT OF JURISDICTION OFAPPELLANT CINFED EMPLOYEES FEDERAL CREDIT UNION

C. Edward Noe (0001757) (COUNSEL OF RECORD)Noe & Macleid Co. L.P.A.2430 Central ParkwayCincinnati, Ohio 45214(513) 381-7333Fax No. (513) 381-1390ednoerc,,one.net

COUNSEL FOR APPELLANT CINFED EMPLOYEES FEDERAL CREDIT UNION

Dola Jean WoodingPro Se Litigant5478 Bahama Terrace, #10Cincinnati, Ohio 45223(513) 956-0944

PRO SE LITIGANT

MAR 2 6 2007

MARCIA J. MENGEL, CLERKSUPREME COURi OF OHIO

Page 2: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

TABLE OF CONTENTS

EXPLANATION OF WHY THIS CASE IS A CASE OF PUBLIC OR GREATGENERAL INTEREST ... ......... ........... ......... ..... ..... .. ....... .. ....... .. ..... ... .. ... 1

STATEMENT OF THE CASE AND FACTS .................................................1

ARGUMENT IN SUPPORT OF PROPOSITIONS OF LAW ..............................4

Proposition of Law No. I: Cross collateral clauses in contracts creating securityinterests between a borrower and their credit union are enforceable to extendthe security interest to future advances ...................................................4

Proposition of Law No. II: Use of a credit card by a cardholder constitutes assentto the terms of a cardholder agreement ............................:......................5

CONCLUSION .....................................................................................9

PROOF OF SERVICE ...........................................................................10

APPENDIX Apox. Page

Opinion of the Hamilton County Court of Appeals(February 23, 2007) .....................................................................11

Page 3: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

EXPLANATION OF WHY THIS IS A CASE OF PUBLIC OR GREAT GENERALINTEREST

This case presents two critical issues regarding the general enforceability of

contracts in the State of Ohio. The first issue requires the Court to affirm the

enforceability of cross collateral clauses as expressed in O.R.C. §1309.204. The second

issue requires the Court to affirm what the several appellate courts in the State of Ohio'

have determined is the law regarding the enforceability of credit cardholder agreements.

These issues are significant because they are considered as settled areas of law

relied upon by borrowers and lenders in making contracts to extend credit. The First

Appellate District has rendered an opinion in this action that effectually announces a

departure from legal precedent that would, if given broad effect, fundamentally alter the

relationships relied upon by contracting parties in Ohio. Resultantly, millions of credit

cardholder agreements would be unenforceable, and security interests created by cross

collateral clauses, as well as the statute that permits them, would be nullified. Appellant

therefore entreats this Court to assume jurisdiction over the case in order that it might

reaffirm settled principles of law drawn into shadows by the decision rendered by the

Appellate court.

STATEMENT OF THE CASE AND FACTS

The case involves the interplay of two contracts between the parties, Cinfed

Employees Federal Credit Union (Lender) and Dola Jean Wooding (Borrower). The

Lender is a federally regulated credit union, devoted to providing banking services for its

members. Borrower was a member of Lender credit union.

' i.e. the Tenth, Fifth, Ninth, and Eighth Appellate Districts are all in accord, incontradiction to the First Appellate District, which decided this case.

1

Page 4: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

The first contract negotiated between the parties was executed May 1998. The

Lender loaned money to the Borrower for the purchase of a used car. The contract terms

provided that the purchased automobile would serve as collateral to secure the money

loaned. The contract was significantly titled "Open End Credit Agreement." The

significance is that the title implies that terms of this contract may apply to other

instances of borrowing between the credit union and its member. Further intimating this

collateral arrangement is found in the contract under the subsection titled "Security

Agreement," which states, inter alia, "Collateral securing other loans with credit union

will also secure this loan." Further evidence that the loan has collateral security

implications appears on the front page of the contract, where it reads as follows.

"Collateral is required for all advances in excess of my (Borrower's) unsecured limit. The

credit union will take a security interest in the property purchased with the advance or in

the property offered as collateral for the advance."

The implications of these provisions are clear; this is not a discrete loan. Rather, it

represents an ongoing relationship of advancing credit between the credit union and its

member.

Further clarifying the issue is the cross collateral clause presented in the box just

north of the Borrower's signature. It reads in pertinent part "Collateral securing other

loans with the credit union.... will also secure this loan. All security listed above secures

this debt and all other obligations ... direct or indirect, absolute or contingent, now

existing or hereafter arising with the credit union." These provisions manifest that the

Borrower's collateral will serve to secure all loans made with the credit union now or in

2

Page 5: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

the future. This would include a credit card provided by the Lender to the Borrower at a

later time.

Three months later, in August of 1998, Borrower applied for, and received a

credit card and cardholder agreement. The Borrower adjured that she did not receive a

copy of the cardholder agreement when she received the card. The Appeals court relied

upon this assertion by the Borrower in its decision, but as we will see, its dependence on

this claim was misplaced. It is the policy generally of card issuers to provide a copy of a

cardholder agreement when the card is issued.

Borrower does not dispute that she received the card, and that she made use of it

to purchase goods and services. She further does not dispute that she ultimately defaulted

on her obligation to repay a balance on that card. The trial court rendered a judgment on

this unpaid balance in the amount of $2,531.63. The Appeals court affirmed that part of

the judgment. The debt remains unpaid.

The application signed by the Borrower for the card states in pertinent part, that "I

understand that Cinfed Credit Union will be taking a security interest in any and all

accounts ... listed in my name(s). And in the event of default, I authorize Cinfed Credit

Union to apply same accounts to payment of said application." The credit card

application also expressly stated that the Borrower "agree[d] to the terms and conditions

accompanying the card(s)."

The cardholder agreementfurther referenced the issue of collateral, stating in

pertinent part that if the Lender held "any title, pledge or security interest in any of your

property, it may be that the terms of the instrument creating [that] ... interest will also

3

Page 6: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

secure your obligations on the Account." These terms are noted in the Appeals' court

decision.

The following facts explain the genesis of the case. On or about 3/14/2003,

Borrower defaulted on her credit card. The car had been paid off the year before. Lender

had not issued the title to the automobile to Borrower because of the outstanding balance

remaining on the credit card. The car was totaled in an accident in 2004. Borrower's

insurance company demanded the title of the car before it would release proceeds to her

in compensation for the loss. Borrower demanded the title from the Lender, which

refused, citing that the collateral represented by the title was yet encumbered because of

the outstanding balance on the credit card account. Borrower sued for declaratory

judgment and specific performance, demanding that the title be released to her. Lender

answered and counterclaimed for the unpaid balance of the credit card account. The

Magistrate found for the Lender, and entered judgment as indicated above. Borrower

appealed, and the Appeals court reversed judgment in respect to Lender's holding the

title. They directed the Lender to release the title to the Borrower. As stated previously,

they affirmed the judgment in favor of the Lender for the unpaid balance on the credit

card.

ARGUMENT IN SUPPORT OF PROPOSITINS OF LAW

Proposition of Law No. I: Cross collateral clauses in contracts creating securityinterests between a borrower and their credit union are enforceable to extendthe security interest to future advances.

The original contract for the car provided for a security interest in that collateral.

The cross collateralization clause provided that this collateral would secure any other

4

Page 7: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

contracts between the parties. Such clauses are permissible in Ohio pursuant to O.R.C.

§1309.204(C).5 The statute states that a security agreement may provide that secured

collateral applies also to future advances. Here the contract states in unambiguous fashion

that the contract for the car would extend the security interest in the car to other advances

made by Borrower from Lender. While the relevant provisions of this cross

collateralization were noted by the Appeals court, they failed to address the effect of

these provisions on the future advance of funds to the Borrower under the credit card

agreement.

The effect of this oversight results in a de facto nullification of those provisions in

the Lender's contract. Consequently, Lender's security interest is stripped, and they are

ordered to surrender the interest to the Borrower. Borrower is permitted to realize her

recovery from the insurance company, and need not pay her debt from those proceeds.

This is keenly unfair to the Lender, who reasonably relied upon the security relationship

created in the original contract when they extended credit to the Borrower on the credit

card.

Apart from this injustice, the Supreme Court has an interest in rectifying this

misstatement of law that has resulted in Lender's injury.

Proposition of Law No. II: Use of a credit card by a cardholder constitutes assent

to the terms of a cardholder agreement.

The Appeals court based its decision on what at first blush appears to be a factual

issue. But its implications are unavoidably implicated as a restatement of established

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Page 8: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

legal precedent. It is an established legal precedent in Ohio that a credit cardholder

obligates himself or herself to the terms of a credit cardholder agreement by use of the

credit card. It is not necessary for a card issuer to procure a signature on every iteration of

its operative cardholder agreement in order to enforce the terms of the agreement.

As a legal matter, all Ohio appellate courts that have addressed the issue have

stated this proposition as definitive. A sample list follows.

Discover Financial Servs., Inc. v. Belmont, 2006-Ohio-1539 8th District Court of

Appeals of Ohio, Cuyahoga County, decided on March 30, 2006 "So regardless whether

he solicited the card or not, he used it and in doing so, bound himself to the terms of the

credit card agreement "(¶4); accord Natl. Check Bur. v. Buerger, 2006-Ohio-6673 9th

District Court of Appeals of Ohio, Lorain County, decided on December 18, 2006 "We

find that Appellant pled the essential elements of breach of contract ... that by use of the

credit card *** Defendant became bound by the terms and conditions of the Credit Card

Agreement."(¶17-18); accord Discover Bank v. Poling, 2005-Ohio-1543 10th District

Court of Appeals of Ohio, Franklin County, decided on March 31, 2005 "in Bank One,

Columbus, N.A. v. Palmer (1989), 63 Ohio App.3d 491, 493, we stated that "credit card

agreements are contracts whereby the issuance and use of a credit card creates a legally

binding agreement." See, also, State Savings Bank v. Watts (Mar. 4, 1997), Franklin App.

No. 96AP-809; Bank One of Columbus v. Might (June 15, 1982), Franklin App. No.

82AP-86. Following our decision in Bank One, the Fifth District Court of Appeals in

Asset Acceptance LLC v. Davis, Fairfield App. No. 2004-CA-00054, 2004-Ohio-6967,

held that a creditor need not produce a signed credit card application to prove the

existence of a legally binding agreement because the credit card agreement created one,"

6

Page 9: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

(117) Affirmed Calvary SPVI, LLC v. Furtado, 2005-Ohio-6884 (¶18) decided 12/27/05;

and Am. Express Travel Related Servs. V. Silverman, 2006-6374 (¶10), decided 12/5/06;

and accord Manufacturers & Traders Trust Co. v. Lindauer (1987), 135 Misc.2d 132,

513 N.Y.S.2d 629.

Notwithstanding this body of precedent, the First District Court of Appeals held it

dispositive of the issue that the general cardholder agreement lacked a signature, and as a

consequence, the terms therein stated were not enforceable in respect to the issue of cross

collateralization. They stated "...our resolution of the assignments of error is very simple,

because the record does not contain an executed copy of the credit card agreement." (¶12)

In the following paragraph, the court concedes that "[a]lthough the signed credit

card application is in the record, the application stated only that [Borrower] would agree

to the terms and conditions that would accompany the card."(Emphasis added) The

application further reads, "I understand that Cinfed Credit Union will be taking a security

interest in any and all accounts...listed in my name(s)." This is stated directly above the

Borrower's initials. The court notes this, and then promptly dismisses its effect on the

grounds that the admonishment fails to specify the car as the collateral to which it refers.

The Borrower reasonably relied on the inference that the car would be included in the

phrase "any and all [accounts] listed in my name(s)."

This ruling states that the security provisions of the cardholder agreement are

unenforceable for the stated reason that the Borrower did not execute the general

cardholder agreement. This is a misstatement of the law, as noted by the list of precedents

above. It is settled law that mere use of a credit card will bind the user to the terms and

conditions of the cardholder agreement. Though not stated, it may be that specific terms

7

Page 10: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

could be held unenforceable for other reasons, but it is clear that they will not be held

unenforceable solely for lack of a signature. Use of the card demonstrates the Borrower's

assent to all terms of the cardholder agreement that are not otherwise determined to be

unenforceable.

The reason that underlies this rationale is unavoidable. Card issuers have literally

millions of customers. On occasion they need to alter the terms of the operative

agreement, often in response to national consumer protection legislation. It would be

impossible for a card issuer to renegotiate each account. It would further be unfair

because the terms of each account would be impacted by the individual status of each

account. Which is to say that a cardholder could unfairly impose concessions on the card

issuer at such a juncture in order to gain their assent to new terms or be compelled to

discharge the debt. In recognition of this reality, card issuers must rely on more general

indicators of assent, such as use of the credit card, or a signature on an application. The

law wisely allows for this.

Consequently, the appeals court cannot coherently maintain that the security

interest clause(s) are unenforceable because the agreement lacked a signature. Moreover,

the application for the card clearly bears the Borrower's signature.

This leaves only that the security provisions in the cardholder agreement were

held unenforceable by the court of Appeals because the provisions did not specify the car

as the collateral they referred to in the general phrase any and all accounts. And because

the issue of signature is immaterial, the several references to a security interest that

appear in the text of the cardholder agreement must either be given full effect, or also

nullified on the proposition that their lack of specificity renders them unenforceable.

8

Page 11: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

Clause (E) of the cardholder agreement states, "[i]f we...hold any ... security

interest in any of your property, it may be that the terms of the instrument creating

the ... security interest will also secure your obligations on th[is] Account."

And the original contract clearly does create a cross collateral security interest in

future advances like the credit card account. In order to reach the result obtained by the

Appeals court, this provision must be thrown out for lack of specificity. Despite its

specific reference directly to the only other contract held by the Borrower, which created

the security interest in the car.

The Supreme Court will not fail to recognize that this precedent asserted by the

First District, clothed though it is in a wrapper of mere factual concerns, cannot rationally

survive within the climate of its own contradictions. For the sake of clarity and

consistency in the law, the decision of the Appeals court must be overruled.

CONCLUSION

Appellant respectfully requests the Supreme Court recognize that the

misstatements detailed above significantly impact the enforceability of some of the most

common consumer contracts in effect in Ohio. Consequently, it is of great public and

general interest to reaffirm sound and established law on these issues. And overturn the

ruling of the First District Court of Appeals as indicated.

Respectfully Submitted:

C. Edward No Counsel of Record

C. Edward NoeCOUNSEL FOR APPELLANTCINFED CREDIT UNION

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Page 12: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

Certificate of Service

I certify that a copy of this Memorandum in Support of Jurisdiction was sent by ordinaryU.S. mail to Pro Se Liti.-ant Dola Jean Wooding at her address of record, 5478 BahamaTerrace, #10, Cincinnati, Ohio 45223 on th^ day of March, 2007.

COUNSEL FOR APPELLANTCINFED CREDIT UNION

10

Page 13: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

IN THE COURT OF APPEALS

FIRST APPELLATE DISTRICT OF OHIO

HAMILTON COUNTY, OHIO

DOLA JEAN WOODING,

Plainti ff-Appellant,

vs.

CINFED EMPLOYEES FEDERALCREDIT L^IION,

Defendant-Appellee.

FEB 2 3 2007IMAGE

APPEAL NO. C-050958"['R[AL NO. A-0501 5l4

JUDG ^bIEN7' EN7'X Y.

'fhis cause was heard upon the appeal, the record, the bricfs, and arguments.

The judgment of the trial court is affirmed in part, reversed in part, and final

judgment entered for the reasons set forth in the Decision filed this date.

Further, the court holds that there were reasonable grounds for this appeal, allows

no penalty and orders that costs are taxed under App. R. 24.

The court further orders that 1) a copy of this Judgment with a copy of the

Decision attached constitutes the mandate, and 2) the mandate be sent to the trial court

for execution under App. R. 27.

`I'o The Clerk:

Enter upon the Journal of the Court on February' 23, 2007 per Order of the Court.

Acting Presiding Judge

Page 14: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

F9L.EDCOURT OF APPEALS

FEB 2 3 2007

GREGORY HARTMAriNCLERK OF COURTSHAMILTON COUNTY

IN THE COURT OF APPEALS

FIRST APPELLATE DISTRICT OF OHIO

HAMILTON COUNTY, OHIO

DOLA JEAN WOODING,

Plaintiff-Appellant,

vs.

CINFED EMPLOYEES FEDER,%T.CREDtT UNION.

Defendant-Appellee.

APP}rAL NO. C-0509-58TRIAL NO. A-0501 514

DECISIO:V.

D72 '1 i-t^3g

PRESENTED TO T};E CLF.4KOF COURTS FOR fi,

FEB 2 3 2007

COURT OF APPEALS

Civil Appcal Froin: Hamilton County Court of Common Pleas

Judgment Appealed From Is Afft:aned in Part, Revrrsed in Part, and Final JudgmentEntercd

Date of Judtn:ent Entry on Appeal: Pebrua r•^_3, 2007

Dol.r,/cart {Vooditts,>. pro se.

C. Ediccrrd :A'o" snd:Voc & .Aluclaid CoM ^ R

L.P.:1.. for Defz :dant-.\ppcl',cc.

Page 15: MAR 2 6 2007 Cinfed Employees Federal Credit Union, Appellant, V. Dola Jean Wooding, Appellee, On Appealfrom the Hamilton County Court of Appeals, First Appellate District Court of

OHIO FIRST DISTRICT COURT OF APPEALS

HII-DEBRAVDT, Presiding Judgc.

{T,1} Plaintiff-appellant, Dola Jean Woodina, appeals the judgment of the

Hamilton C.ounty Court of Common Pleas in favor of del'endant-arpellce, Cinfed

Employees Federa! Credit Union, in a suit alleging unfair lending practices. Vdoodin`

also appeals the court's judgment in fa^ar of Cinfcd on a counterclaim for an unpa:d

debt.

{¶2} In titay 1998. Wooding received a loan from Cinfed for the purchase of art

autoinobile. 'I-he loan document, captioned "Open End Credit Agreement," listcd the car

as collateral for the loan. It also provided the following. "COLLA TERAi,. Col;atcral

securing other loans with the credit union other than your personal residence «ill also

secure this loan. AIl security listed abo-,e secures this debt and all other obligations

excluding your personal residcnce, direct or indirect, absolute or contingent. non ex?sting

or hercafter arising with the credit union.°

{'rz} Ttien, in AuQust 1998, Wooding applied for a credit card ^cith Cinfed.

Thc application pro^idcd, 'I understand that Cinfcd Credit Union \cill b,- takirw, a

security intcrest itr any and all accounts (exccpt individual rotiretnent accounts) lis'ed in

n1y natne(s). And in the c\ent of default, I authorize Cinfed Credit tinion to ipp l\ same

accounts to paN mcnt nf said obligations.-

{i^d} A capita!ized notice in the application further r;cited that ould

"agrcx to the tcrm,3nd conditions accomp,imin« thc card(s)." \Coodim, initi:ilcd ncxt to

that prMision, indicating that sh: had rend it. Shc was appro^ed for the crcdit car.l and

inctoTcd sirnifieant debt ti•:rou oh its use. At son e point, she delaulted on the credit-card

debt.

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OHIO FIRST DISTRICT COURT OF APPEALS

{TS} Woodini_4 paid off the car loan in 2002, but she had not paid the entire

balance on the credit-card account.

{1j6} In 2004, Wooding wrecked the car, and she requested that Cinfed provide

her «ith the car's title so that she could obtain insurance procceds. Cinted refused the

request, stating that the car ,cas collatera! for the credit-car debt and that her default on

that debt permitted Cinfed to retain the title to the car.

{S7} Wooding filed suit, claiming that Cinfed's retention of the title violated

various federal and state consumer-protection statutes. Cinfed filed a counterclaim

seeking the balance nf the credit-card dcbt. In licu of live testimony, the parties

submitted trial memoranda to a niagistrate.

{18} G'`'ith its trial memorandum, Cinfed submitted an unsigned, undatcd

document captioned "Cinted Employees Federal Credit Union Visa'•tiiastercard Credit

Card Account ?.grec.ment." The credit-card agreement stated, "If we noM or hereafter

hold any title, pledge or sccurity interest in any of your property, it may be that ihe terms

of thc instrunient cteating the title, plcdge or security interest \\i'1 a:so secu.,c your

obligations on the .Account.-

{T9} The magistrate rccommended that judemcnt be entered in f::%'or of Cinfcd

on q ll oC Woodin_'s claims, concluilino tha: \'ti•oodirlo had alidl} plcd-acd thz car as

securit}for the credit-card account. Thc magistrate also recomniended th.il Cinfe;i he

awarded $?,; 31.h ^ on its counterclaitn for the balance of the cr:dit-c-ard debt The trial

court overniled \V-ooding's oh:ectieas to the magistrate's report and entcred jud-ment in

accordance %%itl: the r.,a^istrate'; recommendations.

{T10} In her first throu-h fifth assi(7nments of error, Wooding ar'-ues that the

trial court erred in holding that the cross-collateralization clause in the credit-card

3

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OH7O FIRST DISTRICT COII12T' OF APPEALS

agreement justified Cinfed's retention of the automobile title. We address the

assignments together.

(1111) A judgment supported by some competent, credible e^idence going to all

the essential elements of the case will not be reversed as being against the manifest

weight of the evidence.t But even under that deferential standard, we hold that the trial

court erred in this case,

{T12} Wooding presents a number of arguments concerning federal aad state

consumer-protection laws. But our resolution of the assignments of error is very simple,

because the record does not include an executed copy of the credit-card agreemcnt.

(113} Throughout the proceedings, Wooding maintained that she had not seen

the credit-card agreetnent. Althotlgh the signed credit-card application is in the record.

the application stated only that Wooding would agree to the terms and conditions that

w•ould accompany the card. The record does not reflect that Wooding had actually

received the credit-card agreement, much tess that she had understood and assented to its

tenns.

(4,114) And %rhile the credit-card app;ication stated that Cinfed could assert a

security interest in R'ooding's other "accounts," there was nothing in the application that

identitied the car or any other tangible property as collateral.

{I;IS} Sin:ilarly, thotl,h the automobilc-loan al-reement recitcLl that ihe car

%^ould serve as collateral for "all other oblications." there ^+as nothine in al)N of the

documents CXCcutzit by WOodin- to indicate speGtlcalll' that the car tiolll:-1 sca:R: the

crcdlt-card acco'1ni. Under thcse 6rcl1[11i'anccs, \\",- cOnclnde Ihat t11C.rc N^ai t'.p tileennL

' See C E. ;ifurrrs C'a v. Foley Corstr.Co. ( 197S), `1 Oh;o St 2d 279.3716 '.J.E.2d _^ 75, scIIabus

4

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OHIO FIRST DISTRICT COURT OF APPEALS

of the minds with respect to the cross-collateralization of the automobila.Z We sustain the

first through fifth assignments of error.

{Jj 16} In the sixth assignment of error, IX'ooding argues that the trial court erred

in entertaining Cinfed's counterclaim. We find no error. Cinfed's counterclaim for the

unpaid credit-card debt arose "from the transaction or occurrence"3 that was the subject

of V'ooding's claim, and it did not require the presence of any party outside the court's

jurisdiction. Accordinglv, it was a compulsory counterctaim under Civ.R. 13(A), and we

overrule the sixth assignment of error.

{!^17} In her seventh and tinal assignment of error, Wooding argues that the trial

court erred in overruling her objections to the magistrate's report. \l-e agree with Cinfed

that this assignntent of error is subsumed under the remaining assignments. We sustain it

in part and overnile in part without addressing it in detail.

{¶18} The judgnnent of the trial court with respect to Wooding's claims is

reversed. I;Ve lterebv enter judgment declaring that the automobile was not collatera: for

the credit-car loan, and we order Cinfecl to convey the automobile title to Wooding. In all

other respects. \^e affirn the jud,ment of the trial court.

Judgmcnt accordfngly.

StiNDERNt ANti and HENDON, JJ., concur.

Plerrse Nnra

The court hzs placed of record its o%cn entry ir- this case on the date of the rcleasc

of this Decision.

See, gcnerally, Lu:dner v ,.{rrr. Nad. fi:.r. C o, 15: Ohio App.3d 30, 2007-Oh!o-5394, 793 N.G?d I i90, atI 19, and Rr^rfi- v Cincinnati Ben,4na, /nc..(2001), I43 Ohio App.3d 516,521, 758 N.E.2d 678.' Civ.R. 13(A). See, also, ('rines Auro Fin. Sans, v. 8rnxn, 163 Ohio App3d 746,2_005-Ohio-5207, 840N.E.2d 254, at 41J2.

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