Ohio Supreme Court: Homeowner can seek restitution by appealing foreclosure

A borrower who attempts but fails to stop a property foreclosure can seek restitution after the property has been sold, the Supreme Court of Ohio ruled this week.

In a unanimous opinion, the Supreme Court ruled that an appeal of a foreclosure is not moot if the trial court refuses to stay the foreclosure proceedings and allows the property to be sold. The Court found R.C. 2329.45 allows a borrower who challenges a foreclosure to seek restitution if an appeals court rules the foreclosure was improper.

Writing for the Court, Justice Daniel R. Hawkins explained that some Ohio appeals courts, including the Eighth District Court of Appeals, have ruled that an appeal from a foreclosure is moot if a stay has not been secured, the property was sold, and the proceeds from the sale have been distributed. 

However, R.C. 2329.45 indicates that while property owners who have not secured a stay cannot recover their property, they can seek financial compensation through court-ordered restitution.

“Moreover, courts may generally impose restitution by court order and routinely do so in situations involving claims of unjust enrichment to recoup a benefit conferred on a party,” Justice Hawkins wrote.

Today’s decision reversed an Eighth District ruling that Grace Doberdruk’s appeal of her foreclosure was moot because she was unable to post a bond and stay the order to sell her home at a sheriff’s auction. 

The Court ordered the appeals court to consider the merits of Doberdruk’s challenge to her foreclosure and determine whether the lender, Wells Fargo Bank, owes her restitution.