February 27, 2013
Due Process and the Internet

by Justice Paul E. Pfeifer

This case presents a sort of collision between constitutional obligations and technological advancements. It began when PHH Mortgage Corporation filed a foreclosure action against Michael S. Prater in April 2008.

The Clermont County Sheriff’s Office scheduled the property to be sold at a sheriff’s sale in January 2009. But the sheriff withdrew that foreclosure sale at PHH's request. A new date was set for June, but was again withdrawn at PHH’s request. A third sale was scheduled for November 2009, but again, PHH requested it be withdrawn.

Each time, PHH received notice by mail of the date, time, and location of these sale dates. The notice of the third sale date was accompanied by a letter from the sheriff, which stated: “In an effort to control the ever-increasing costs, effective December 31, 2009, the Clermont County Sheriff’s Office will be discontinuing the practice of sending sheriff sales property advertisements…” The letter said that future information about sheriff sales would be available online, and then gave the website address.

In April 2010 the property was scheduled for sale a fourth time. This time the sale went forward, and Scott A. Wolf purchased the real estate.

Afterward, PHH filed a motion in court to set aside the sale, claiming that it hadn’t received written notice of the date and time of the sale. The trial court denied PHH’s motion. PHH appealed, but the court of appeals affirmed the trial court’s judgment. After that, the case came before us – the Supreme Court of Ohio – for final review.

In 1950, the United States Supreme Court held that “an elementary and fundamental requirement of due process in any proceeding ... is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.” In other words, to satisfy the constitutional requirement of due process, all effort must be made to notify interested parties of pending legal action.

That 1950 court went on to say that at a minimum, the Due Process Clause requires “that deprivation of life, liberty or property by adjudication be preceded by notice and opportunity for hearing appropriate to the nature of the case.”

In that 1950 case, the court held that notice by newspaper publication was insufficient to notify people whose place of residence was known. The court said that it would be “idle to pretend that publication alone ... is a reliable means of acquainting interested parties of the fact that their rights are before the courts.

“Chance alone brings to the attention of even a local resident an advertisement in small type inserted in the back pages of a newspaper. Where the names and post office addresses of those affected by a proceeding are at hand, the reasons disappear for resort to means less likely than the mails to apprise them of its pendency.” In 1993, our court reached the same conclusion in a similar case.

In this case, Scott Wolf argued that PHH’s attorney received actual notice from the sheriff’s office that the date and location of the sheriff’s sale would be found on the sheriff’s website. But what Wolf referred to as actual notice was really notice of a change in the procedure of how notice would be given, not actual notice of the time, date, and location of the sale.

Instead of receiving notice by the traditional method of mail, PHH was required by the new notice procedure to continually monitor the sheriff’s website in order to glean the information. Wolf’s argument confuses notice of the change in procedure with actual notice.

Wolf contended that unlike traditional newspaper publication, the notice letter was directed to PHH’s attorney and advised him where to obtain all the sale information. He also argued that instead of obtaining a local paper, the attorney could immediately access the website information from his computer 200 miles away in Cleveland. And he maintained that unlike traditional print publication, the sheriff’s website displays information for months prior to the sale, which makes it continuously accessible.

Many of these assertions may be accurate, but they still don’t overcome the due process issue, because the sheriff’s new Internet notice procedure shifts the burden of notification from the sheriff’s office to the person to whom the notice is directed.

Rather than sending notice by mail to those parties whose names and addresses are known, the new notice system transfers the burden to the parties to take active steps to research and monitor the information.

While the interest in using technology to conserve resources is understandable, we determined that notice by Internet posting is more akin to publication in a newspaper, and due process demands more in this instance.

In addition, requiring parties to first read a notice that directs them to a website to then search for information that could just as readily have been a part of the original notice poses an additional, unnecessary burden on the party, particularly for those that don’t have readily available high-speed Internet access or the skills to navigate the websites.

Last year, it was reported that 32 percent of households in the United States do not use the Internet at home. And senior citizens access the Internet at a notably lower rate than other adults. Clearly, notice that misses such a large percentage of its intended audience does not constitute the notice our Constitution demands when property is in jeopardy.

Mail is not the only form of notice that would satisfy due process, but under the facts of this case, requiring a party to look at a website to find notice of the date and time of a sheriff’s sale is insufficient.

By a seven-to-zero vote we concluded that notice through the Internet, which is more akin to notice by publication in a newspaper, is simply not sufficient or reasonably calculated to provide actual notice to all interested parties. We therefore reversed the judgment of the court of appeals denying PHH’s motion to set aside the sheriff’s sale.

EDITOR'S NOTE: The case referred to is PHH Mtge. Corp. v. Prater, 133 Ohio St.3d 91, 2012-Ohio-3931. Case No. 2011-1526. Decided September 6, 2012. Majority opinion written by Justice Evelyn Lundberg Stratton.