MEMORANDUM OPINION ON TRUSTEE'S MOTION FOR SUMMARY JUDGMENT

JOHN E. HOFFMAN, JR., Bankruptcy Judge.

I. Introduction

Susan L. Rhiel ("Trustee"), the trustee appointed in the Chapter 7 case of Mohamed Kebe ("Debtor"), commenced this adversary proceeding to obtain, among other things: (1) avoidance of the Debtor's mortgage on certain real property ("Mortgage"); (2) preservation of the lien represented by the Mortgage for the benefit of the Debtor's estate; and (3) sale of the co-owner's interest in the property. Pending before the Court is the Trustee's motion for summary judgment ("Motion") (Doc. 23), as well as responses to the Motion filed by Mamadou Seye ("Seye"), the co-owner of the property ("Seye Response") (Doc. 27), and Central Mortgage Company ("Central"), the holder of the Mortgage ("Central Response") (Doc. 31).1

For the reasons explained below, the Court concludes that the Trustee is entitled to summary judgment on her claims for avoidance of the Mortgage under 11 U.S.C. § 544(a)(3) (Count Two of the Complaint) and preservation of the lien represented by the Mortgage for the benefit of the Debtor's estate pursuant to § 551 (Count Four). On the current state of the record, however, summary judgment on the request to sell Seye's interest in the property (Count Six) is not appropriate. The Court therefore denies summary judgment on Count Six. The Court also declines to grant summary judgment in favor of the Trustee on her remaining claims for relief.2

II. Jurisdiction

The Court has jurisdiction to hear and determine this adversary proceeding pursuant to 28 U.S.C. §§ 157 and 1334 and the general order of reference entered in this district. This is a core proceeding. See 28 U.S.C. § 157(b)(2).

III. Background

A. Background Relevant to the Avoidance of the Mortgage Under § 544(a)(3)

The facts that are material to the issue of avoidance are undisputed. On March 11, 2010 ("Petition Date"), the Debtor filed a voluntary petition for relief under Chapter 7 of the Bankruptcy Code. On September 20, 2004, the Debtor granted the Mortgage on his interest in real property located at 6797 Sowers Drive, Canal Winchester, Ohio 43110 ("Property").3 The Debtor owns the Property jointly with Seye.

The certificate of acknowledgment accompanying the Mortgage provides as follows:

In other words, the certificate of acknowledgment is blank in the place where the persons acknowledging the signing of the Mortgage should have been identified.4 This is the Trustee's sole factual basis for the avoidance of the Mortgage. See Mot. at 4.

According to Central, despite the blank certificate of acknowledgment, the Mortgage substantially complies with Ohio law. In support of its substantial-compliance argument, Central relies on the following undisputed facts:

Central Resp. at 13-14.

According to Central, the Trustee cannot avoid the Mortgage because she had constructive notice of it as of the Petition Date. In support of its constructive-notice argument, Central relies on the following undisputed facts:

The Mortgage was recorded on September 24, 2004 in the Franklin County, Ohio Recorder's Office ("Recorder"). See id. at 2. The Mortgage was assigned to Central by means of an assignment dated November 7, 2008 and recorded on December 12, 2008 ("Assignment"). See id. at 2-3. The Assignment contains a legal description of the Property and also provides as follows:

Central Resp. Ex. A-4.

On December 9, 2008, Central filed a foreclosure complaint against the Debtor and Seye in the Franklin County, Ohio Court of Common Pleas ("State Court"), Case No. 08 CVE 12-17508 ("Foreclosure Action"). The Foreclosure Action sought a judgment on the promissory note ("Note") executed by the Debtor and Seye and sought foreclosure of their interests in the Property. In paragraph 3 of the State Court complaint, Central stated that the Mortgage was a good and valid first lien upon the Property. On February 19, 2009, Central filed a motion for default judgment against Seye and the Debtor. On that same day, Janice Davis, the Vice President of Central, filed an affidavit in the Foreclosure Action ("Davis Affidavit") asserting Central's interest in the Property and identifying the Note and the Mortgage. On February 23, 2009, the State Court granted Central default judgment against Seye and the Debtor ("Judgment Entry"). The Judgment Entry was never vacated, released or satisfied. On March 31, 2009, Central voluntarily dismissed the Foreclosure Action without prejudice. See Central Resp. at 4-5.

Central did not file a certificate of judgment with the Recorder, and records contained on a website maintained by the Recorder show that no such document was filed in those records. Likewise, records contained on a website maintained by the Franklin County Clerk of Courts ("Clerk") show that no certificate of judgment was filed with the Clerk, and Central does not contend that it did so.

In support of its objection, Central filed the Affidavit of Dow T. Voelker ("Voelker Affidavit"). Dow T. Voelker ("Voelker") is an attorney and a title examiner. In the Voelker Affidavit, Voelker states that he examined the documents filed of record with the Recorder and the Clerk with respect to the Property. He also states that "[a]s a title examiner, who has examined real estate records for twenty-five (25) years, I would have inquired and found [the Mortgage, the Assignment, the Foreclosure Action and the Davis Affidavit]" and that "[a]s a title examiner who would issue a title insurance policy on the Property, I would not have ignored the [the Mortgage, the Assignment, the Foreclosure Action and the Davis Affidavit][,] and I would have identified Central's interest in the Property." Voelker Aff. ¶¶ 14 & 15.

B. Background Relevant to the Sale of the Property Free of Seye's Interest

As explained below, the facts relevant to the Trustee's request to sell the Property free of Seye's interest are disputed:

1. The Trustee's Allegations

The Trustee has attached to the Motion an affidavit ("Trustee Affidavit") stating that:

Trustee Aff. at 1-2.

2. Seye's Allegations

Seye responded to the Trustee's allegations with statements set forth in the Seye Response.6 First, Seye alleges that the Debtor owns little, if any, of the equitable interest in the Property:

Seye Resp. at 2, 4-5.

Second, Seye contends that the benefit to the estate of the sale of the Property would not outweigh any detriment to Seye, stating as follows:

Id. at 5-6.7

IV. Legal Analysis

A. Summary Judgment Standard

Under Rule 56 of the Federal Rules of Civil Procedure ("Civil Rule(s)"), made applicable in this adversary proceeding by Rule 7056 of the Federal Rules of Bankruptcy Procedure, a court "shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R.Civ.P. 56(a).8 "On a motion for summary judgment, facts must be viewed in the light most favorable to the nonmoving party only if there is a genuine dispute as to those facts." Ricci v. DeStefano, 557 U.S. 557, 129 S.Ct. 2658, 2677, 174 L.Ed.2d 490 (2009) (internal quotation marks omitted). A dispute is genuine only if it is "based on evidence upon which a reasonable [finder of fact] could return a [judgment] in favor of the non-moving party." Gallagher v. C.H. Robinson Worldwide, Inc., 567 F.3d 263, 270 (6th Cir.2009). And a "factual dispute concerns a `material' fact only if its resolution might affect the outcome of the suit under the governing substantive law." Id.

B. Avoidance Under § 544(a)(3)

Section 544(a)(3) of the Bankruptcy Code provides as follows:

11 U.S.C. § 544(a)(3). Exercising the "strong-arm powers" granted her by § 544(a)(3), the Trustee seeks to avoid the Mortgage as to the Debtor's one-half interest in the Property because the certificate of acknowledgment is indisputably blank. It is well-established that trustees may avoid mortgages under § 544(a)(3) based on blank certificates of acknowledgment, see, e.g., Rhiel v. Huntington Nat'l Bank (In re Phalen), 445 B.R. 830 (Bankr. S.D.Ohio 2011) (analyzing numerous cases), and there is no point in re-plowing that ground here. Instead, the Court will address why the Trustee is entitled to avoidance in this case notwithstanding each of Central's arguments to the contrary.

1. The Mortgage

First, Central's reliance on the recording of the Mortgage is misplaced. "Since the Bankruptcy Code gives [the] trustee ... the rights of a bona fide purchaser without actual knowledge ... [the trustee] is entitled to the rights of a subsequent bona fide purchaser without knowledge of the prior mortgage." Simon v. Chase Manhattan Bank (In re Zaptocky), 250 F.3d 1020, 1028 (6th Cir.2001). And, although "the Bankruptcy Code's strong arm clause does not immunize a trustee who has constructive [notice] of a prior mortgage," id. at 1027, "Ohio law deems any purchaser—including bankruptcy law's hypothetical [bona fide purchaser]—to have constructive notice of all instruments executed by the current owner of the land" only if those instruments are "`proper[ly] record[ed].'" Argent Mortg. Co. v. Drown (In re Bunn), 578 F.3d 487, 489 (6th Cir. 2009) (quoting Thames v. Asia's Janitorial Serv., Inc., 81 Ohio App.3d 579, 611 N.E.2d 948, 953 (1992)).9 In other words, "[u]nder Ohio law, only mortgages that were properly recorded have priority over the interests of bona fide purchasers." Hazlett v. Chase Home Fin., LLC (In re Nowak), 414 B.R. 269, 274 (Bankr.S.D.Ohio 2009) (emphasis added). Furthermore, "[t]o be properly recorded ... the Mortgage must be an `instrument[] of writing properly executed for the conveyance or encumbrance of lands, tenements, or hereditaments....'" Id. (quoting Ohio Rev.Code Ann. § 5301.25).10

Central's contention that the Mortgage was properly executed, see Central Resp. at 11, is plainly incorrect. The blank certificate of acknowledgment rendered the Mortgage improperly executed. See, e.g., Phalen, 445 B.R. at 841-57 (analyzing relevant provisions of the Ohio Revised Code as well as Smith's Lessee v. Hunt, 13 Ohio 260 (1844) and other cases). And not only is an improperly executed mortgage "not entitled to [be] record[ed]... even if it is recorded, the defective mortgage is treated as though it has not been recorded." Mortg. Elec. Registration Sys. v. Odita, 159 Ohio App.3d 1, 822 N.E.2d 821, 825 (2004).

Central argues that, despite the blank certificate of acknowledgment, the Mortgage was entitled to be recorded because the certificate of acknowledgment adequately identified the persons whose signatures were being acknowledged under Ohio's substantial-compliance standard.11 But nothing to which Central points—not the inclusion of Seye and the Debtor in the Mortgage's granting clause, nor Seye's initialing of the Mortgage, nor the fact that Seye signed the Mortgage individually and as attorney in fact for Debtor, nor the appearance of their names on the Mortgage below the signatures— causes the certificate of acknowledgment itself to identify the persons whose signatures were being acknowledged. The Mortgage, therefore, was not executed in substantial compliance with Ohio law. See Fifth Third Bank v. Farrell, 2010 WL 3852223, at *6 (Ohio Ct.App. Sept. 28, 2010) ("In the present case, there is no ... information relating to Michael Farrell in the [certificate of acknowledgment]. It is blank.... We therefore find, pursuant to Smith's Lessee, [that] the certificate of [acknowledgment] in the present case does not substantially comply with [Ohio Revised Code §] 5301.01 because it was left blank.");12 Phalen, 445 B.R. at 848 ("[C]ourts in this district consistently have held that a certificate of acknowledgment does not satisfy the substantial-compliance standard if it completely fails to identify the mortgagor.").13

The representation made in the Voelker Affidavit that Voelker would have found and not ignored the Mortgage is beside the point because the issue here is not whether someone might have obtained actual knowledge of the Mortgage—which, as explained above, cannot be charged to the Trustee—but whether the Mortgage provided constructive notice of the Debtor's interest in the Property.

2. The Assignment

As with the Mortgage, the representation made in the Voelker Affidavit that Voelker would have found and not ignored the Assignment does not support Central's argument against avoidance because the issue is not whether someone might have obtained actual knowledge of the Mortgage through the recording of the Assignment, but whether the recording of the Assignment provided constructive notice of the Mortgage. For the reasons explained below, the Court concludes that the Assignment's recording did not provide constructive notice of the Mortgage.

Although the Assignment itself was properly recorded and it does refer to the Mortgage, a recorded instrument's reference to a prior instrument does not provide constructive notice if the referenced instrument itself was defectively executed. See Thames, 611 N.E.2d at 954. In Thames, where a land contract was at issue, the Ohio court of appeals held that "while it is undisputed that the ... deed referencing the land contract . . . was recorded... the land contract to which it referred was defectively executed and, therefore, the reference in the deed to the land contract does not constitute constructive notice ... of the existence of the land contract...." Id. This holding was based on the rule of law that "where [a] land contract ... is defectively executed in contravention of [Ohio Revised Code § ] 5301.01, the reference to it in another recorded deed does not serve as constructive notice to a subsequent purchaser...." Id.

Substitute "mortgage" for "land contract" and "assignment of mortgage" for "deed"—under Ohio law there is no reason not to do so—and the rule of law announced in Thames directly applies here. That rule of law, of course, is that, if a mortgage is defectively executed in contravention of Ohio Revised Code § 5301.01, the reference to it in an assignment of mortgage does not serve as constructive notice to a subsequent purchaser.14 This must be the result here. As discussed in more detail below, "[w]here an intermediate appellate state court rests its considered judgment upon the rule of law which it announces, that is a datum for ascertaining state law which is not to be disregarded by a federal court unless it is convinced by other persuasive data that the highest court of the state would decide otherwise." West v. Am. Tel. & Tel. Co., 311 U.S. 223, 237, 61 S.Ct. 179, 85 L.Ed. 139 (1940). Although the Assignment was properly recorded and the Assignment referenced the Mortgage, the Mortgage itself was defectively executed. Accordingly, the reference in the Assignment to the Mortgage does not provide constructive notice of the existence of the Mortgage.

The arguments and cases on which Central relies to support its position to the contrary are unavailing. Central relies on Noland v. Wells Fargo Bank N.A. (In re Williams), 395 B.R. 33 (Bankr.S.D.Ohio 2008) for the proposition that, for the purpose of constructive notice, "[t]he `contents' of ... a recorded instrument include recitals or disclosures therein as to outstanding rights in the property even though not created by that instrument." Williams, 395 B.R. at 45. See Central Resp. at 10. Central fails to note, however, that Williams was quoting Thames and that, as discussed above, the holding of Thames—that a recorded instrument's reference to a prior instrument does not provide constructive notice if the referenced instrument itself was defectively executed—is directly contrary to Central's argument. In addition, Williams is inapposite. In that case the bankruptcy court held that a properly executed and recorded mortgage could not be avoided by the trustee merely because an assignment of the mortgage had not been recorded. See Williams, 395 B.R. at 45 ("[T]he Trustee will take subject to the Mortgage despite the failure to record an assignment of that Mortgage...."). Unlike in Williams, in this case the Mortgage was not properly executed and thus was not entitled to be recorded. The holding of Williams, therefore, has no application on the facts of this case.

Also inapposite is another decision on which Central relies, Drown v. Wells Fargo Bank, N.A. (In re Scott), 424 B.R. 315 (Bankr.S.D.Ohio 2010). In Scott, the issue was whether Chapter 7 trustees could avoid mortgages based on alleged defects in the execution of deeds through which the debtors acquired their property, not on any defects in the execution of mortgages themselves. The Court held that the mortgages, having been perfected through proper recording by the time the debtors filed their bankruptcy cases, were not avoidable by the trustees in exercise of their strong-arm powers. As Central states, the Court, "[r]elying on Wayne Building & Loan Co. v. Yarborough, 11 Ohio St.2d 195, 228 N.E.2d 841 (1967) ... explained that as hypothetical purchasers of the property, the Trustees would be deemed to have searched the real estate records under the Debtors' names to have found the properly executed and recorded mortgages." Central Resp. at 11. True, but here the Mortgage was not properly executed and thus was incapable of proper recordation. Scott, then, undercuts rather than supports Central's position. See Scott, 424 B.R. at 328 ("The deemed title search ... provides a trustee with constructive notice of properly executed and recorded real-estate instruments only, not of improperly executed or unrecorded ones.").

Central also relies on Tiller v. Hinton, 19 Ohio St.3d 66, 482 N.E.2d 946 (1985) in support of its argument that the Trustee had constructive notice of the Mortgage. In Tiller, the Ohio Supreme Court held that "[p]ursuant to [Ohio Revised Code § ] 5301.25, an unrecorded easement is not enforceable against a bona fide purchaser for value who has no actual or constructive notice of such easement." Tiller, 482 N.E.2d at 948 (syllabus). That holding provides no support for Central's argument here. Central contends that the Assignment's reference to the Mortgage provides "inquiry notice that the Mortgage encumbers the Property" and that "[t]o find that the Trustee was not put on inquiry notice ... would render the long standing Ohio doctrine of inquiry notice a nullity." Central Resp. at 12. Central then describes Ohio law on inquiry notice as follows: "`[A] purchaser will be charged with knowledge of a previous encumbrance upon real property when he has knowledge of facts which would induce a prudent person to make an inquiry by which he would have or could have obtained knowledge of [the] prior encumbrance.'" Id. at 11-12 (quoting Thames, 611 N.E.2d at 953). What Central omits from its quotation of Thames, however, is that two sentences later the court stated that the inquiry-notice standard "has only been applied in Ohio in the absence of a recording statute." Thames, 611 N.E.2d at 953 (emphasis in original) (citing Wayne Building, 228 N.E.2d at 847; Shaker Corlett Land Co. v. Cleveland, 139 Ohio St. 536, 41 N.E.2d 243, 246 (1942); Hembree v. Mid-America Fed. S. & L. Assn., 64 Ohio App.3d 144, 580 N.E.2d 1103, 1110-11 (1989)). As discussed above, the court in Thames held that where—as in that case and here—Ohio's recording statute applies, a recorded instrument's reference to another instrument does not provide constructive notice if the referenced instrument itself was defectively executed. See Thames, 611 N.E.2d at 954.

In the final analysis, it is a correct application of Thames—not Central's incorrect interpretation of that decision or its misplaced reliance on other inapposite cases—that must govern the issue of whether the Assignment provided constructive notice of the Mortgage.15 This is because, as noted above, in making its prediction of how the Ohio Supreme Court would rule—which is the Court's role here—a decision of an Ohio appeals court such as Thames must not be disregarded unless there exists "other persuasive data that the highest court of the state would decide otherwise." West, 311 U.S. at 237, 61 S.Ct. 179. See also Puckett v. Tenn. Eastman Co., 889 F.2d 1481, 1485 (6th Cir.1989) ("[A] federal court may not disregard a decision of the state appellate court on point, unless it is convinced by other persuasive data that the highest court of the state would decide otherwise."); Grantham & Mann, Inc. v. Am. Safety Prods., Inc., 831 F.2d 596, 608-09 (6th Cir.1987) ("[A]lthough a decision by a lower state court is not controlling where the highest state court has not spoken, the decision of an intermediate appellate state court ... is a datum for ascertaining state law which is not to be disregarded by a federal court unless it is convinced by other persuasive data that the highest court of the state would decide otherwise." (citations and internal quotations marks omitted)).

Central has failed to provide any such persuasive data. Unlike Thames, the decisions on which Central relies are not on point and therefore cannot override the requirement that the Court apply Thames. See Gettins v. U.S. Life Ins. Co., 221 F.2d 782, 785 (6th Cir.1955) ("It must be assumed that the Court of Appeals for Cuyahoga County was familiar with the prior cases decided by the Ohio Supreme Court. [T]he Supreme Court has ... made no decision on the particular question involved in the present case. On the other hand, the Court of Appeals for Cuyahoga County appears to have supplied a controlling answer to the question here in issue. That being so, we are bound by it, until or unless the Supreme Court of Ohio gives a contrary answer. In these circumstances, it is not for us to exercise our independent judgment, to look to other jurisdictions, or to speculate as to what the Supreme Court of Ohio might some day decide.") (citing West, 311 U.S. at 223, 61 S.Ct. 179). Thus, the Court concludes that the result here must be consistent with Thames—that is, the Assignment's reference to the Mortgage, which was defectively executed, did not provide constructive notice of the Mortgage.

3. The Foreclosure Action, the Davis Affidavit and the Judgment Entry

Equally unavailing is Central's reliance on the Foreclosure Action, the Davis Affidavit and the Judgment Entry in support of its argument that the Trustee had constructive notice of the Mortgage. Central does not contend that it filed a certificate of judgment regarding the Foreclosure Action, the Davis Affidavit or the Judgment Entry with the Recorder, and records contained on a website maintained by the Recorder—of which the Court may take judicial notice, see In re Trenton Ridge Investors, LLC, 461 B.R. 440, 483 (Bankr.S.D.Ohio 2011)—show that no such document was filed in those records. Furthermore, records contained on a website maintained by the Clerk show that no certificate of judgment was filed with the Clerk, and Central does not contend that it did so. Filing a certificate of judgment with the Clerk would have provided Central with a judgment lien on the Property, and such a filing, if done properly, could have provided constructive notice of that lien to third parties; the Judgment Entry itself, however, does not provide constructive notice. See State ex rel. Collier v. Farley, 2006 WL 2692573, at *5 & n. 3 (Ohio Ct.App. Sept. 8, 2006) ("[P]ursuant to [Ohio Revised Code § ] 2329.02, a lien is immediately created upon the lands of the judgment debtor when a certificate of judgment is filed with the clerk of courts. The act of filing is constructive notice to all parties of the existence of the lien.... In our view, the [Ohio Revised Code §] 2329.02 provision that a judgment becomes a lien upon the filing of a certificate of judgment requires a filing in addition to the court's filing of the original judgment entry, even though that filing may also occur in the office of the clerk of the court which originally rendered the judgment." (citations omitted)).16 Central, however, failed to file a certificate of judgment.

In short, Central did not take the steps necessary to place third parties on constructive notice of its interest in the Property. See ABN AMRO Mortg. Grp., Inc. v. Roush, 2005 WL 858182, at *1, *8 (Ohio Ct.App. Apr. 14, 2005) ("Here, it is undisputed that appellant did not record ... a certificate of judgment after she won the Roush lawsuit.... Thus, the trial court was correct in determining that appellee did not have constructive notice of appellant's interest in the property."). Absent the filing of a certificate of judgment, the Davis Affidavit, which was filed with the Clerk, is no more effectual for providing constructive notice than are the Judgment Entry and the Foreclosure Action.

Under the doctrine of lis pendens, the Foreclosure Action would have prevented the Trustee from prevailing on her avoidance action if the Foreclosure Action had been pending as of the Petition Date. Unfortunately for Central, it was not. "Lis pendens is a Latin term that means a suit pending." Condren v. Harrison (In re Borison), 226 B.R. 779, 782 n. 3 (Bankr.S.D.N.Y.1998). The following description by the Ohio Supreme Court of the common-law background of the doctrine of lis pendens is helpful in understanding why the doctrine does not apply here in light of the dismissal of the Foreclosure Action:

Beneficial Ohio, Inc. v. Ellis, 121 Ohio St.3d 89, 902 N.E.2d 452, 454-55 (2009) (quoting Cook v. Mozer, 108 Ohio St. 30, 140 N.E. 590 (1923) (emphasis added)).

In Ohio, the doctrine of lis pendens is codified in Ohio Revised Code § 2703.26, which also makes clear that the action must be pending in order for the doctrine to apply. See Ohio Rev.Code Ann. § 2703.26 (emphasis added) ("When a complaint is filed, the action is pending so as to charge a third person with notice of its pendency. While pending, no interest can be acquired by third persons in the subject of the action, as against the plaintiff's title.") (emphasis added).17 Because the Ohio Revised Code states that "[w]hile pending, no interest can be acquired by third persons in the subject of the action," Ohio Rev.Code Ann. § 2703.26, and because one of the requirements for the doctrine's application is that "the court must have jurisdiction both of the person and the res," Beneficial Ohio, 902 N.E.2d at 455, courts consistently have held that lis pendens applies only while the action that gave rise to it remains pending. See, e.g., Helbling v. Cleary (In re Cleary), 2010 WL 2649949, at *6, 2010 Bankr.LEXIS 2156, at *16 (Bankr.N.D.Ohio July 1, 2010) ("[T]he trustee cannot be charged with constructive notice [of the mortgage] because the [foreclosure] case was not pending at the commencement of the bankruptcy petition on May 31, 2009. [Ohio Revised Code § 2703.26] requires that the case be `pending' in order to charge third parties with notice."); ABN AMRO Mortg., 2005 WL 858182, at *1, *7; Bank of N.Y. v. Stambaugh, 2003 WL 22844267, at *3 (Ohio Ct.App. Nov. 26, 2003) ("The doctrine of lis pendens protects a plaintiff's interest in real estate while the case is pending. The... action was no longer pending [when the mortgage to the bank was executed].... [Thus,] [t]he doctrine of lis pendens does not protect appellee's interest in the real estate.").

The Ohio court of appeals decision in ABN AMRO Mortgage is particularly instructive here. In that case, not only had there been a dismissal of the lawsuit that was the linchpin for the application of lis pendens, but the prevailing party relied in part on an affidavit that appears to be inconsistent with the Voelker Affidavit:18

ABN AMRO Mortg., 2005 WL 858182, at *1-2, *7-9 (footnotes omitted).

Again, Voelker's statement that he would have found and not ignored the Foreclosure Action or the Davis Affidavit does not support Central's position in this adversary proceeding. Not only is the argument that Central makes based on the Voelker Affidavit inconsistent with the argument on which ABN AMRO Mortgage prevailed in the Ohio appeals court, the Voelker Affidavit cannot change the fact that the Foreclosure Action was no longer pending on the Petition Date. In light of the foregoing, the Court GRANTS summary judgment on Count Two in favor of the Trustee.

C. Preservation of the Avoided Mortgage Under § 551

Pursuant to § 551 of the Bankruptcy Code "[a]ny transfer avoided under section ... 544 ... is preserved for the benefit of the estate but only with respect to property of the estate." 11 U.S.C. § 551. After avoidance, § 551 preserves the portion of the Mortgage granted by the Debtor on his one-half interest in the Property for the benefit of his estate. See Castle Nursing Homes, Inc. v. Ransier (In re Sullivan), 359 B.R. 357 (table), 2007 WL 1018763 at *6 (6th Cir. BAP Apr. 4, 2007) ("Any transfer avoided under § 544 is automatically `preserved for the benefit of the estate.'" (quoting § 551)); Terlecky v. Chase Home Fin., LLC (In re Sauer), 417 B.R. 523, 541 (Bankr.S.D.Ohio 2009) (same). The Court therefore GRANTS summary judgment on Count Four in favor of the Trustee.

D. Declaratory Judgment

In Count One the Trustee seeks a declaratory judgment "that the Debtor's one-half interest in the Property is not encumbered by the Mortgage." Compl. at 3. The Court has concluded that the Trustee may avoid the Mortgage for the reasons explained above. As a result, the Trustee's request for a declaratory judgment that the Debtor's one-half interest in the Property is not encumbered by the Mortgage is of no practical significance and therefore is moot. See Finstad v. Florida, Dep't of Bus. & Prof'l Regulation, 295 Fed.Appx. 352, 353 (11th Cir.2008) ("A complaint becomes moot when it no longer presents a `live' controversy or a ruling on the issues would have no practical significance."). The Court accordingly DISMISSES Count One of the Complaint on the basis of mootness.

E. Avoidance Under § 547

The Trustee seeks in Count Three to avoid the transfer of the Debtor's one-half interest in the Property to Central as a preferential transfer under § 547(b). In light of the Court's ruling that the Mortgage is avoidable pursuant to § 544(a)(3), the request for relief under § 547 is no longer of practical significance and therefore is moot. See Finstad, 295 Fed.Appx. at 353; Hardesty v. U.S. Bank, N.A. (In re Schmidt), 445 B.R. 865, 868 (Bankr. S.D.Ohio 2011) (dismissing as moot the Chapter 7 trustee's claim to avoid a mortgage under § 544(a)(1) after the court granted summary judgment in favor of the trustee on his claim to avoid the mortgage under § 544(a)(3)). The Court, therefore, DISMISSES Count Three on the basis of mootness.

F. Recovery Under § 550

In Count Five the Trustee seeks, pursuant to § 550, to recover from Central the value of property the Debtor transferred to it. Compl. at 5. Recovery is not appropriate where the avoidance of the mortgage is a sufficient remedy in and of itself. See Suhar v. Burns (In re Burns), 322 F.3d 421, 427 (6th Cir.2003) ("[W]hen the avoidance alone is a sufficient remedy, there is no need for the trustee to seek recovery."); Phalen, 445 B.R. at 864 (citing additional cases). On the other hand, in those instances where "merely [avoiding] the [transfer] ... and placing the burden on the Trustee to sell the Property... would not restore the bankruptcy estate to where it would have been had the [transfer] not taken place," Slone v. Lassiter (In re Grove-Merritt), 406 B.R. 778, 812 (Bankr.S.D.Ohio 2009), recovery may be warranted. For the reasons explained below, it remains an open question whether the Trustee will be able to sell the Property; thus, it is too early to tell whether avoidance will be an adequate remedy on the facts of this case. The Court, therefore, DENIES the Trustee's request for summary judgment on Count Five of the Complaint without prejudice to her renewing the request in the event that she is unable to sell the Property.

G. Sale of Seye's Interest Under § 363(h)

The Court also denies the Motion insofar as it relates to the Trustee's request to sell Seye's interest in the Property. Section 363(h) states as follows:

11 U.S.C. § 363(h). "The Trustee bears the burden of proving each of the four elements of § 363(h)." Durand v. Ackerman (In re Durand), 2010 WL 3834587, at *12 (E.D.N.Y. Sept. 27, 2010).

Seye characterizes the statements in the Trustee Affidavit relating to the requirements of § 363(h)(1) and (2) as "self-serving opinions" with "no factual basis...." Seye Resp. at 4. Central makes a similar point. See Central Resp. at 17 ("[T]he Trustee has failed to prove any of the elements under Section 363(h) demonstrating that she is entitled to sell the property. As noted above, the Trustee's affidavit contains only legal conclusions. This affidavit is not enough to support a motion to sell."). The Court, however, concludes that § 363(h)(1) and (2) are satisfied here. Because there is no question that the home located on the Property is a single family residence, see Seye Resp. at 1, there can be no genuine dispute that partition in kind of the Property among the estate and Seye is impracticable or that the sale of the estate's undivided interest in the Property would realize significantly less for the estate than the sale of the Property free of Seye's interest. See Bostic v. Nat'l City Bank (In re DeRee), 403 B.R. 514, 522-23 (Bankr.S.D.Ohio 2009) ("[C]ourts have recognized that as a general proposition [w]here property is a single family residence, there is no practicable manner of partition other than a sale and division of the proceeds" [and that] the sale of a bankruptcy estate's undivided interest will generate substantially less than the sale of the property free of each owner's interest because of the chilling effect that the sale of the undivided interest usually has on prospective purchasers of the property." (citations and internal quotation marks omitted)); Berland v. Gauthreaux (In re Gauthreaux), 206 B.R. 502, 505-06 (Bankr. N.D.Ill.1997) (same). Accordingly, the Trustee has carried her burden of proof under § 363(h)(1) and (2).

Further, the Trustee Affidavit states that the Property is not used in the production, transmission, or distribution, for sale, of electric energy or of natural or synthetic gas for heat, light, or power, and Seye does not contend otherwise. Section 363(h)(4), therefore, imposes no impediment to the entry of summary judgment in favor of the Trustee on her request to sell the Property free and clear of Seye's interest. Rather, the obstacle to the Trustee's obtaining summary judgment is § 363(h)(3), which requires her to establish that the benefit to the Debtor's estate of a sale of the Property free of Seye's interest outweighs any detriment to Seye.

As with the other subsections of § 363(h), the ultimate burden of proving compliance with § 363(h)(3) rests with the Trustee. See Peterson v. Lewis (In re Jenkins), 347 B.R. 77, 86 (Bankr.N.D.Ill. 2006) ("In connection with this requirement (as with the other three conditions of § 363(h)), the trustee bears the burden of proof."). But the burden under § 363(h) is a shifting one. The Trustee's "initial burden... is simply to show that a sale free of the interests of the debtor's co-owners will produce a benefit to the estate." Id. "Once that burden is met, the defendants must come forward with evidence of detriment." Id. "If the Defendant then shows that such a sale would produce a detriment to him, the Trustee must show that the benefit to the estate is greater than the detriment to the Defendant." Gray v. Burke (In re Coletta Bros. of North Quincy, Inc.), 172 B.R. 159, 165 (Bankr.D.Mass. 1994).

To meet her initial burden of demonstrating that a sale of the Property free of Seye's interest would produce a benefit to the estate, the Trustee must show "that the estate's share of the net proceeds would exceed existing liens on the Debtor's interest in the property." Id. And to do that the Trustee must produce evidence of the value of both the Property and the liens on the Property as well as the costs to the estate of obtaining authority to sell the Property. As described below, the Trustee has not met her burden here.

With respect to value "[t]he trustee often satisfies this burden through stipulations as to the value of the property and the amount of existing liens, or through the testimony of appraisers or the parties themselves." Jenkins, 347 B.R. at 86. See also Durand, 2010 WL 3834587, at *12 ("[T]he Bankruptcy Court based its determination [to approve the sale free of the co-owner's interest] on the only evidence in the record as to the [value of] the property, an appraisal stating that it was valued at $361,500." (internal quotation marks omitted)); Nathan v. Barbera (In re Barbera), 1996 WL 446821, at *3 (Bankr. E.D.Mich. Aug. 5, 1996) ("The Trustee called an appraiser who presented evidence as to the current value of the properties... as a justification for his request to sell the entire properties, including Mrs. Barbera's interests, under section 363(h) of the Bankruptcy Code. The Defendants did not dispute the appraiser's evidence."). By contrast, here the Trustee relies on the value of the Property set forth in, and the liens identified on, the Debtor's schedules of assets and liabilities ("Schedules"). See Mot. at 18 ("The Debtor's Schedules value the Property at $161,000.00. The Property is subject to a purported mortgage of approximately $141,675.00, half of which can be avoided, preserved, and recovered for the estate. Therefore, the sale of the entire Property would yield a significant dividend for the estate, which outweighs any detriment resulting to Seye."). Although under appropriate circumstances a debtor's schedules can be properly viewed as admissions of the debtor, they generally are not considered admissions of a non-debtor party. See Am. Express Bank v. Askenaizer (In re Plourde), 418 B.R. 495, 505 n. 13 (1st Cir. BAP 2009) ("Generally, a bankruptcy court may properly consider a debtor's petition, schedules and statement of affairs as evidentiary admissions made by the debtor.... However, when the objecting party is the trustee, the bankruptcy schedules are not admissible as an admission against the trustee."). And although the value of property set forth on a debtor's schedules could be sufficient evidence of value where the schedules are admitted into evidence without objection, see Jenkins, 347 B.R. at 87, or where there is no opposition to the trustee's motion for summary judgment, see DeRee, 403 B.R. at 523, Seye has opposed the Motion. Although Seye appears to assume that the value of the Property is the one set forth in the Schedules, he does so only for the sake of argument. See Seye Resp. at 5 ("[A]ssuming for the sake of argument that the Debtor's interest is one half and also assuming that the property could sell for $161,000, the estate would receive $80,500."). Under these circumstances, the Court may not rely on the Schedules for the purposes of granting summary judgment.

Moreover, in order to carry her initial burden under § 363(h)(3) of showing that the estate's share of the net proceeds would exceed existing liens on the Debtor's interest in the property, the Trustee must present evidence regarding other liens on the Property, if any. The Trustee has alleged in her Motion the amount of the Mortgage lien, but has not made any representations in her Affidavit that there currently are no other liens on the Property, such as tax liens, judgment liens or junior mortgages. For this additional reason, the Trustee has failed to carry her burden of proof under § 363(h)(3). See Jenkins, 347 B.R. at 87 & n. 6 ("Contributing to the insufficiency of the proofs [regarding the benefit to the estate] is the dearth of evidence concerning the existence... of any liens or encumbrances on the Property.... [T]here is virtually no testimony or other evidence to show that there are no mortgages, real estate tax liens, or other encumbrances on the Property at present. Again, the entry on Schedule A, listing the value of Debtor's interest in the Property as $70,000 with corresponding `Amount of Secured Claim' shown as `0.00,' has little or no probative value in this case. Accordingly, the court finds that the Chapter 7 Trustee has failed to establish a right to sell the entire Property pursuant to § 363(h) of the Bankruptcy Code."). Similarly, in order to carry her initial burden under § 363(h)(3) of showing that the estate's share of the net proceeds would exceed existing liens on the Debtor's interest in the property, the Trustee must present evidence of the costs of sale. See Coletta Bros., 172 B.R. at 165 (denying summary judgment on the trustee's request under § 363(h) where there was no evidence of the value of the property or the costs of sale). Here, the Trustee has submitted no evidence of the costs to the estate of selling the Property free and clear of Seye's interest, nor has she submitted any evidence of the costs of pursuing this litigation to sell the Property free of Seye's interest—costs that will reduce the proceeds that ultimately are available to be distributed to unsecured creditors.

Even if the Court were to find that the Trustee had carried her initial burden, the Court would not grant the Trustee's request for summary judgment to sell the Property free and clear of Seye's interest at this stage of the proceedings. "Under subsection (h)(3), after the trustee has made his prima facie case establishing that the estate would benefit from the sale of the residence, the burden shifts to the defendant to show ... a detriment to him." Durand, 2010 WL 3834587, at *12. "Detriment has been defined as economic hardship, as well as any loss, harm, injury or prejudice resulting from the involuntary displacement." DeRee, 403 B.R. at 523 (internal quotation marks omitted).

Seye alleges several bases for a finding of detriment here. In response to the Trustee's argument that there is no detriment to him because "[u]pon a sale of the Property, Seye is free to purchase another home or to make an offer to the Trustee to purchase the Debtor's interest in the Property," Mot. at 17-18,20 Seye contends that it would be impossible for him to purchase the Debtor's interest. See Seye Resp. at 5 ("In order to protect his personal residence, Seye would have to find additional financing for $80,500. That would make the total indebtedness on the Property $219,094.02, or 136% of the current value. It is highly improbable that Seye will be able to secure a loan, with so much of it being unsecured, and would not be able to purchase the Debtor's interest, contrary to the assertion's [sic] of the Trustee."). Other courts have found such arguments to be persuasive. See Gauthreaux, 206 B.R. at 506 ("[T]he detriment to [the] Defendant... would be severe. Despite his equity in the property, he cannot obtain financing to enable him to [purchase the debtor's interest in the property], and would suffer hardship in being displaced.... [T]here is no assurance that what he nets would be enough to purchase a new home because he has too much debt to qualify for the substantial new mortgage loan that he would require.").

Seye also contends that detriment to him would arise from his having made all the monthly payments and having paid for all of the maintenance and upkeep on the Property, costs that he would not completely recoup even if he were to receive one-half of the sale proceeds.21 See Seye Resp. at 5-6 ("Seye would have lost $11,202.99 in equity on the property and would have lost his personal residence for which he paid $69,256.60 in just principal and interest alone (on the Note). All told, Seye would be harmed a total of $138,553.61 without even figuring in all of Seye's costs."). Again, other courts have found such arguments to be persuasive on the issue of detriment to the co-owner. See Lovald v. Tennyson (In re Wolk), 451 B.R. 468, 473 (8th Cir. BAP 2011) ("[T]here was substantial evidence of detriment to the co-owner if the court allowed the sale of the property. Such evidence included ... the fact that all the equity in the home had been contributed by the co-owner, not the debtor.").22 See also Cmty. Nat'l Bank & Trust Co. v. Persky (In re Persky), 893 F.2d 15, 21 (2d Cir.1989) ("In weighing detriment to the non-debtor ... a number of variables must be considered[,] [including] ... [the] respective contributions to the purchase price of the home [and] prospects for acquiring a new home....").

The Trustee's response to all of this is that "[a]ny detriment to Seye is the unfortunate result of the Debtor filing bankruptcy while owning a one-half interest in an avoidable mortgage" and that "[t]he detriment results from such avoidance and not from the Trustee's sale of the property." Reply at 17. This argument is unpersuasive. Although the Trustee would not be seeking to sell the Property if she could not avoid the Mortgage, the detriment to Seye, if any, would arise from the sale.

Finally, it bears noting that Seye has submitted only argument, not evidence (such as an affidavit), on the detriment issue. Accordingly, if the Trustee had carried her initial burden, Seye could have lost on summary judgment. See DeRee, 403 B.R. at 523 n. 6 ("In the face of the Trustee's affidavit, a party cannot rely on pleadings, but must put forth evidence."). True, "[i]f a party fails to properly support an assertion of fact ... the [C]ourt may... give an opportunity to properly support the fact," Fed.R.Civ.P. 56(e)(1), but the Court also would have had the authority to grant summary judgment in favor of the Trustee. See Fed.R.Civ.P. 56(e)(3) ("If a party fails to properly support an assertion of fact ... the [C]ourt may ... grant summary judgment if the motion and supporting materials—including the facts considered undisputed—show that the movant is entitled to it....").

V. Conclusion

For the foregoing reasons, the Court GRANTS the Motion in part and DENIES it in part. The Court GRANTS summary judgment in favor of the Trustee on her request in Count Two of the Complaint for avoidance of the Mortgage under § 544(a)(3) and on Count Four of the Complaint for preservation of the lien represented by the Mortgage for the benefit of the Debtor's estate pursuant to § 551. The Court DENIES, on the basis of mootness, summary judgment on Count One of the Complaint (seeking a declaratory judgment that the Debtor's one-half interest in the Property is unencumbered by the Mortgage) and Count Three of the Complaint (seeking avoidance of the Mortgage under § 547) and dismisses both counts. Summary judgment on the Trustee's request for recovery in Count Five (a claim for recovery from Central under § 550) is DENIED without prejudice to the Trustee renewing the request in the event that she is unable to sell the Property. Given the state of the record on the issue of whether the benefit to the Debtor's estate of a sale of the Property free of the interest of Seye outweighs any detriment to Seye, the Court DENIES, without prejudice, summary judgment on the Trustee's request in Count Six of the Complaint to sell Seye's interest in the Property.

In accordance with this memorandum opinion, the Court will enter a separate judgment in favor of the Trustee on Count Two and Count Four and will deny summary judgment on the remaining counts. A status conference on the remaining counts will be scheduled by separate order of the Court.

IT IS SO ORDERED.