Posted on June 15th, 2013 by Mark Stopa
As we all know by this point, Florida Governor Rick Scott has signed HB87 into law. There are aspects of the bill that I, as a consumer advocate and foreclosure defense attorney, don’t like. Portions of the bill, however, are quite favorable for consumers. In fact, this new law gives Florida homeowners a whole new round of defenses, effective immediately.
Under Fla. Stat. 702.015, if a foreclosure plaintiff files a complaint after July 1, 2013 and is the “holder” of the original promissory Note, that plaintiff is required to certify under penalty of perjury that it is in possession of the Note, the name and title of the individual giving the certification, the name of the person who verified the plaintiff’s possession, and the date on which possession was verified.
If a foreclosure plaintiff is seeking to re-establish a lost Note, the obligations are even more onerous. In that event, an affidavit under penalty of perjury must be attached to the Complaint, and that affidavit must: (a) detail a clear chain of all assignments, transfers, or assignments of the Note; (b) set forth facts showing the plaintiff is entitled to enforce the lost Note; and (c) attach documents to the affidavit which support the plaintiff’s claims.
I’m very confident the banks are unprepared to comply with these requirements. From what I know of the banking industry, the foreclosure complaints they’re filing now were drafted months ago – before this new law came into effect. Hence, it’s likely that many if not most of the foreclosure complaints filed in Florida since June 7, 2013 will be subject to dismissal for failure to comply with these new requirements.
From what I know of the banking industry, I suspect it will take many weeks, perhaps months, before the Complaints the banks file comply with these requirements in Fla. Stat. 702.015. As a result, so long as these complaints are deficient, Florida judges will be obligated to grant motions to dismiss these complaints.
HB87 isn’t all bad, folks. This is obviously good news.
To answer some obvious questions …
These requirements apply to complaints filed after July 1, 2013. If your complaint was filed before then, these aspects of 702.015 don’t apply.
If a foreclosure lawsuit was filed before July 1, 2013 but the plaintiff files an Amended Complaint after that date, do these portions of 702.015 apply? The statute doesn’t specify, but I think so. The statute is remedial in nature, so I’d think most judges will require that amended complaints filed after July 1, 2013 include these pleading requirements – just as most judges I know required Amended Complaints filed after the verification requirement in Rule 1.110(b) be verified.
Is the “certification” and “affidavit” required by Fla. Stat. 702.015 different than the verification requirement of Fla.R.Civ.P. 1.110(b)? Absolutely. The verification requirement of Rule 1.110(b) is quite vanilla. The statutory requirements here are much more onerous. Plus, while the Rule allows verifications on “knowledge and belief,” the statute requires unequivocal verifications. This is, truly, an obligation to sign under penalty of perjury.
The banks don’t like signing under penalty of perjury (crooks never do), so we’ll see how they handle these new requirements. Eventually, I suspect they’ll start complying with the new certification and affidavit requirements. Until they do, however, make sure you’re asking that foreclosure complaints be dismissed for failure to comply with the new requirements of Fla. Stat. 702.015.
Mark Stopa
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Posted on June 15th, 2013 by Mark Stopa
I see all sorts of bizarre and unethical conduct in foreclosure-world on a regular basis. This one, though, might just take the cake.
Apparently, some attorneys are representing plaintiffs AND defendants in foreclosure cases. Yes, there are lawyers in Florida who act as counsel for banks while also acting as counsel for homeowners. Once I realized this was happening, I did some digging. Incredibly, it seems this is a regular occurrence in Florida courtrooms.
I know this is really taking a trip into bizarro-world, but try to imagine it. You’re a homeowner, and your lawyer is helping you fight foreclosure in a lawsuit filed by Bank of America. Yet that same attorney is also going to court on behalf of Bank of America, trying to help it foreclose on homeowners.
Can you imagine that? Until recently, the thought of doing this would have never occurred to me. Seriously, how can anyone have the passion and zeal necessary to represent homeowners in one instant, yet in the next breath help Bank of America try to foreclose on a homeowner? In my view, they can’t. It’s just not possible.
Apparently, though, it happens all the time, often in the context of “local counsel.”
In many parts of Florida, judges don’t allow telephone hearings. Orange County, Brevard County, and Manatee County are but a few examples. As a result, instead of traveling to these courthouses for in-person hearings, the banks and their lawyers hire “local counsel,” i.e. attorneys who reside close to those courthouses. These local attorneys often don’t formally appear as counsel of record in a case, they just show up to court and argue for the banks.
From what I’m told, the banks don’t pay these “local counsel” much money. As a result, these attorneys are left searching for more work. So what do they do? Often, they act as counsel for homeowners in foreclosure cases. Yes, even though these attorneys regularly go to court for banks, they simultaneously represent homeowners.
The problem here is worse than a moral dilemma. There’s more going on here than the appearance of impropriety when an attorney represents both sides simultaneously. You see, all Florida Bar attorneys are bound by Rule 4-1.7 of the Rules Regulating The Florida Bar, which provides:
RULE 4-1.7 CONFLICT OF INTEREST; CURRENT CLIENTS
(a) Representing Adverse Interests. Except as provided in subdivision (b), a lawyer shall not represent a client if:
(1) the representation of 1 client will be directly adverse to another client; or
(2) there is a substantial risk that the representation of 1 or more clients will be materially limited by the lawyer’s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.
(b) Notwithstanding the existence of a conflict of interest under subdivision (a), a lawyer may represent a client if:
(1) the lawyer reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client;
(2) the representation is not prohibited by law;
(3) the representation does not involve the assertion of a position adverse to another client when the lawyer represents both clients in the same proceeding before a tribunal; and
(4) each affected client gives informed consent, confirmed in writing or clearly stated on the record at a hearing.
You read the rule, and you tell me. Can an attorney act as counsel for Wells Fargo in one case and simultaneously act as counsel for a homeowner, adverse to Wells Fargo, in another?
Under subsection (b), it’s theoretically possible, I suppose, but as a practical matter, it’s virtually impossible. After all, there’s no dang way any bank is going to give informed consent, in writing, to the attorney acting in this manner, and I can’t imagine any homeowner doing so, either.
It’s past time that the foreclosure industry clean up this mess. Lawyers shouldn’t be able to flaunt the Bar Rules in this regard. Hence, if you see anyone representing banks and lawyers at the same time, tell them about Rule 4-1.7. Ask to see the “informed consent” required by subsection (b)(4). File motions to disqualify counsel, where appropriate. Object to appearances by “local counsel.”
Foreclosure-world has enough problems already. It’s an uphill climb as it is. Homeowners shouldn’t have to worry if their attorney moonlights as an attorney for the banks. And, as much as I might dislike the banks, even the banks shouldn’t have to wonder if their attorneys do double-duty as counsel for homeowners. Rule 4-1.7 exists for a reason, and everyone should be following it.
Mark Stopa
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