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Foreclosure upheld against wife's interest in property where she ratified mortgage in bankruptcy petition

In light of the undisputed evidence that defendant-Lori Klemm took actions to affirm her husband's (defendant-Jeffrey Klemm) acts, the court held that the trial court did not err in ruling that she ratified the mortgage at issue. Thus, it affirmed the trial court's order granting the plaintiff summary disposition and entering a judgment of foreclosure against Lori's interest in the property. Jeffrey executed the mortgage on her behalf under a POA whose authenticity she later disputed. "Jeffrey and Lori used the proceeds to pay off an existing note and mortgage on the property that they had both executed." The note and mortgage at issue were eventually assigned to plaintiff, which sued for judicial foreclosure. Jeffrey and Lori alleged that when he executed the mortgage on her behalf he did not have written authority to do so. On appeal, Lori contended that the evidence showed she did not have knowledge of the material facts concerning the mortgage and, thus, her subsequent actions could not ratify it. However, before plaintiff sued to foreclose in 3/12, Lori petitioned for bankruptcy. In her petition, she stated that she knew about the mortgage and considered herself a codebtor. She also listed plaintiff as a secured creditor, listed the amount outstanding on the note, and stated that it was her intent to surrender the property. Thus, the evidence showed that she "was aware of the material facts related to the mortgage executed on her behalf." Further, her assertions in her bankruptcy petition showed that she had elected to treat the mortgage as authorized. Also, less than three months after her husband signed the mortgage on her behalf, Lori went to the title company and signed a new POA, giving Jeffrey authority as to mortgages on the property. While it was "unclear when she learned the specific details concerning the note and mortgage, the evidence showed that Lori Klemm eventually became aware of the material terms related to the note and mortgage and took steps to ensure that the process was complete" by signing the new POA. "She also continued to live at the property and considered herself a co-owner, which was only possible because the proceeds" from the note and mortgage were used to pay off a prior note and mortgage.

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