The burden is on the one seeking reformation to demonstrate that the third party had notice of the matters in the reformed deed and therefore could not rightfully claim injury. The Knocks and the Ruehmers met this burden as well. See Spitzer v. Dever (1967), 11 Ohio App.2d 6, 9, 227 N.E.2d 660; Guenther v. Downtown Mercury, Inc. (1958), 105 Ohio App. 125, 129, 151 N.E.2d 749; cf. Tiller v. Hinton (1985), 19 Ohio St.3d 66, 482 N.E.2d 946.Guenther, supra, at 130, 151 N.E.2d 749.
In three interrelated assignments of error, Buckeye Union asserts that the court erred in interpreting the evidence, especially in light of contradictory evidence concerning Jacob Fischer's intentions. A mistake in reducing an agreement to writing is subject to reformation if the resulting written contract fails to reflect the agreement of the parties. Castle v. Daniels (1984), 16 Ohio App.3d 209, 16 OBR 224, 475 N.E.2d 149; Guenther v. Downtown Mercury, Inc. (1958), 105 Ohio App. 125, 5 O.O.2d 413, 151 N.E.2d 749; Greenfield v. Aetna Cas. Sur. Co. (1944), 75 Ohio App. 122, 127-128, 30 O.O. 427, 429, 61 N.E.2d 226, 229 ("equity will afford a remedy by way of reformation of a written instrument to make it conform to the real agreement or intention of the parties"). As Buckeye Union aptly notes, "The real question * * * is whether the contract of insurance as written and issued embodies the actual agreement of the parties to it."
Antill v. Antill, 1984 WL 3504, at *4 (Ohio Ct. App. June 4, 1984) (citation omitted).Guenther v. Downtown Mercury, 105 Ohio App. 125, 129-30, 151 N.E.2d 749, 752 (Ohio Ct. App. 1958) (citing 45 Am. Jur. § 112 at 649). Here, as to the elements of establishing Shoregate's status as a BFP, there is no dispute that Shoregate acquired its interest in the lease for value.
The equitable powers of a court to grant reformation are exercised only with great care. Rather than to permit reformation on a lesser showing of proof, the Ohio courts have limited the power of reformation to a showing of "clear and convincing evidence." Guenther v. Downtown Mercury, Inc., 105 Ohio App. 125, 151 N.E.2d 749 (Ct.App. 1958); Greenfield v. Aetna Casualty Surety Co., 75 Ohio App. 122, 61 N.E.2d 226 (Ct.App. 1944). This high standard has not been met by either party in the instant matter. Courts should be reluctant to grant summary judgment on matters such as the ones presented by this case, in which the conclusive finding of fact will rest upon the intentions of parties to activities that occurred years ago. Although the Court notes its misgivings about the finding of mutual mistake permitting reformation in the circumstances of this case, it withholds judgment until the matter is brought to trial.
Even if the error in execution were a mistake capable of correction by section 2719.01, reformation cannot be made when it would "prejudice the rights of bona fide and innocent purchasers." Guenther v. Downtown Mercury, Inc., 151 N.E.2d 749, 753 (Ohio Ct.App. 1958); see Easter, 367 B.R. at 615 ("right of reformation cannot be invoked to abrogate the rights of an innocent intervening third party."). Accordingly, because the defect in execution is one which could not be reformed under Ohio Rev. Code § 2719.01, and alternatively because reformation cannot be made as against the trustee as a bona fide purchaser, the Court holds that MERS is not entitled to reform the mortgage at issue.
" 69 Ohio Jurisprudence 3d 88, Mortgages and Deeds of Trust, citing German Natl. Bank v. Bode (1902), 5 Ohio C.C.(N.S.) 30; Youtz v. Julliard (C.P. 1888), 10 Ohio Dec.Rep. 298. See also Guenther v. Downtown Mercury, Inc. (1958), 105 Ohio App. 125, 129, 5 O.O.2d 413, 151 N.E.2d 749, quoting 76 Corpus Juris Secundum, Reformation of Instruments, Section 58 ("`An instrument may not be reformed as against a subsequent bona fide purchaser for value without notice'"); In re Easter (Bankr.Ct.S.D.Ohio 2007), 367 B.R. 608, 615 (stating that "the right of reformation cannot be invoked to abrogate the rights of an innocent intervening third party"), citing Sullivan v. Doehler Die Casting Co. (C.P. 1945), 15 Ohio Supp. 122, 31 O.O. 28; 13A Ohio Jurisprudence 3d 87, Cancellation and Reformation of Instruments; cf. Huber v. Knock, Hamilton App. No. C-080071, 2008-Ohio-5900, 2008 WL 4891562, at ¶ 10 ("A reformed deed can not be enforced against a bona fide purchaser for value — i.e., an innocent third party — to that party's prejudice"). The trial court made no findings as to whether Joe Senior and his heirs are innocent third parties.
Mason, at 50; see, also, Stewart v. Gordon (1899), 60 Ohio St. 170, paragraph one of the syllabus. However, the general rule is that an instrument may not be reformed as against a bona fide purchaser for value. Guenther v. Downtown Mercury, Inc. (1958), 105 Ohio App. 125, 129. A bona fide purchaser has been defined as one who takes in good faith, for value, and without actual or constructive notice. See Wayne Bldg. Loan Co. v. Yarborough (1967), 11 Ohio St.2d 195, 200.