Happy Thanksgiving from Florida’s Fourth District
Florida’s Fourth District Court of Appeal issued two wonderful opinions today, just in time for Thanksgiving.
In Duke v. HSBC Mortgage Services, LLC, the court reversed an order granting a bank’s motion for summary judgment. The facts in that case were like those I see in many foreclosure cases: the note did not have an indorsement, and was apparently lost, so HSBC relied on an Assignment of Mortgage for the requisite standing. But the assignment post-dated the filing of the complaint. In reversing the summary judgment, the Fourth District explained:
genuine issues of material fact remain in dispute regarding the owner and holder of the note and mortgage at the time the complaint was filed.
This is yet another illustration of how foreclosure defense attorneys can appropriately defend foreclosure cases. The issue in this case wasn’t whether the homeowner was behind on mortgage payments. The issue was HSBC’s ability to prove its entitlement to foreclosure. This is not an anomaly, folks – fact-patterns like this exist in countless foreclosure cases throughout Florida.
A second case from the Fourth District is perhaps even more powerful. In Venture Holdings & Acquisitions Group, LLC v. A.I.M. Funding Group, LLC, the Fourth District not only reversed a summary judgment of foreclosure, it directed the lower court to dismiss the case outright! As the court explained:
An assignment of a promissory note or mortgage, or the right to enforce such, must pre-date the filing of a foreclosure action. Jeff-Ray Corp. v. Jacobson, 566 So. 2d 885, 856 (Fla. 4th DCA 1990). A party must have standing to file suit at its inception and may not remedy this defect by subsequently obtaining standing. … Here, before A.I.M. filed any of the foreclosure actions below, A.I.M. assigned the promissory note and mortgage to a third party as collateral for a loan. Thus, A.I.M. did not have standing to foreclose on any of the properties at the time it filed suit.
In so ruling, the Fourth District distinguished those defendants who had properly defended the case (and were entitled to be dismissed as defendants) from those who did not properly defend, (were defaulted, and were not entitled to be dismissed). This ruling, of course, again illustrates the importance of defending a foreclosure suit from its inception.
The moral of these two decisions? The bank’s obligation to prove its standing to foreclose is well-established in Florida law. And even if the bank appears to be the “right” bank to sue, that’s not the end of the inquiry – the bank had to be the “right” bank to sue as of the date the foreclosure lawsuit was filed.
Mark Stopawww.stayinmyhome.com
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