Background
In December 2022, Wells Fargo Bank filed a foreclosure complaint against Grace Doberdruk, alleging default on a promissory note secured by a mortgage on real property with a principal balance of $449,905. After the trial court granted Wells Fargo’s motion for summary judgment and entered a judgment of foreclosure in January 2024, Doberdruk appealed to the Eighth District Court of Appeals. The trial court denied her motion to stay the sheriff’s sale pending appeal, and the property was sold to a third party at public auction in May 2024. Doberdruk was unable to post the $472,905 supersedeas bond the trial court required to stay the foreclosure proceedings, and the sale was confirmed and proceeds distributed in July 2024.
With the proceeds distributed and no stay in place, the Eighth District sua sponte ordered briefing on whether Doberdruk’s appeal was moot. The Eighth District dismissed the appeal as moot, following its own precedent holding that R.C. 2329.45’s restitution remedy applies only when an appellant obtains a stay of the distribution of sale proceeds. Doberdruk moved to certify a conflict with decisions from the Second, Sixth, and Tenth District Courts of Appeals, and the Supreme Court of Ohio accepted both the certified-conflict question and a discretionary appeal, consolidating the two matters.
The Court’s Holding
In a unanimous decision authored by Justice Hawkins, the Supreme Court of Ohio reversed the Eighth District and held that a foreclosure appeal is not rendered moot by the distribution of sale proceeds when the appellant failed to obtain a stay. The court grounded its holding in the plain text of R.C. 2329.45, which provides that when a judgment in satisfaction of which land is sold is reversed on appeal, the purchaser’s title is protected but the judgment creditor must make restitution equal to the sale proceeds plus interest. The court concluded that nothing in the statute conditions this remedy on the appellant having obtained a prior stay, and that a trial court may order such restitution from the judgment creditor even after the proceeds have been distributed.
The court also rejected Wells Fargo’s argument that failure to post a supersedeas bond constitutes a voluntary satisfaction of judgment that moots the appeal under Blodgett v. Blodgett, 49 Ohio St.3d 243 (1990). The court distinguished Blodgett by emphasizing that mootness turns on whether effectual relief remains available — not on how the underlying controversy reached its current posture. Because R.C. 2329.45 preserves a monetary restitution remedy, the appellate controversy remains live. The court expressly disapproved appellate decisions, including those from the Eighth and Ninth Districts, that had equated the distribution of proceeds with a Blodgett-type voluntary satisfaction.
Key Takeaways
- A foreclosure appeal is not moot after sale-proceeds distribution: R.C. 2329.45 allows a common pleas court to order restitution from the judgment creditor equal to the sale price plus interest if the judgment of foreclosure is reversed on appeal, regardless of whether a stay was obtained.
- Failure to post a supersedeas bond is not a “voluntary satisfaction of judgment” under Blodgett — mootness hinges on whether any effectual remedy remains available, and restitution under R.C. 2329.45 is such a remedy.
- The restitution remedy under R.C. 2329.45 is limited: a successful appellant cannot recover title to the property, which remains with the third-party purchaser. Obtaining a stay is still the only way to prevent title from transferring during appeal.
- Courts ordering restitution must consider all persons who lost an interest in the property and the priority of those interests, as the statute requires.
Why It Matters
This decision resolves a longstanding circuit split among Ohio’s appellate districts and establishes a uniform statewide rule: foreclosure defendants who pursue but cannot afford a stay bond do not automatically forfeit their right to appellate review. By anchoring the mootness analysis to the availability of the R.C. 2329.45 restitution remedy rather than to the procedural step of obtaining a stay, the court prevents lenders from effectively defeating appeals through the mechanics of a rapid sale and distribution.
For practitioners, the ruling has immediate consequences on both sides of foreclosure litigation. Lenders and servicers must now contend with the possibility of restitution liability even after proceeds are distributed, complicating post-sale finality. For homeowners and housing advocates — five legal aid organizations filed amicus briefs urging reversal — the decision preserves the practical value of an appeal for borrowers who cannot post substantial supersedeas bonds, ensuring that the merits of a contested foreclosure judgment receive appellate scrutiny.