Same loan, three different notes: Ohio court blocks Deutsche Bank foreclosure

What followed was a long paper trail with a conspicuous gap in it. In 2006, Deutsche Bank attached copies of the note to two separate foreclosure actions against the borrower. Both filings carried the identical signature page – and neither included an endorsement from New Century, despite the fact that Deutsche Bank was the party trying to enforce the note. Deutsche Bank later dropped both actions voluntarily. 

Then came the third attempt. In February 2018, Deutsche Bank filed a fresh foreclosure complaint with another copy of the note. But this time, the signature page looked different. It now carried an endorsement from New Century that had appeared in neither earlier filing. The borrower flagged the problem. In his answer, he denied the document was authentic and stated it “was not signed by Defendant Joseph F. Russo.” He later filed certified copies of the prior filings so the court could compare pages directly, pointing out that the signature looked different and the font on the page had changed. 

A magistrate ruled for Deutsche Bank anyway, finding the borrower had not “specifically denied” his signature under Ohio’s commercial paper statute, R.C. 1303.36, and lacked standing to challenge the endorsement chain. The trial court adopted that decision. 

The appeals court disagreed on both counts. It found the borrower had done more than offer a blanket denial – he specifically denied the document’s authenticity and stated it was not signed by him. Ohio is a notice-pleading state, the court noted, and pleadings must be read to “do substantial justice.” Even a layperson, the court observed, could spot the discrepancies between the three versions: a different signature, a different font, and an endorsement that materialized only in the 2018 filing. 

On standing, the court held that the cases the magistrate relied on did not bar a borrower from contesting how a note was transferred. Due process, it said, guarantees the right to challenge every element of the bank’s case – including whether Deutsche Bank is actually the rightful holder.