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In the District Court of Appeal Second District of Florida
_________________________
CASE NO. 2D13-4785
(Circuit Court Case No. 09-CA-006508) _____________________
DEUTSCHE BANK NATIONAL TRUST CO., Appellant,
v.
BARRY KEITH PATTERSON Appellee.
____________________________________
ON APPEAL FROM THE NINTH JUDICIAL CIRCUIT IN AND FOR ORANGE COUNTY, FLORIDA
___________________________________________
ANSWER BRIEF OF APPELLEE BARRY KEITH PATTERSON _______________________________________
Dineen Pashoukos Wasylik Florida Bar No. 0191620 DPW LEGAL PO Box 48323 Tampa, FL 33646 Tel: 813-778-5161 Fax: 813-971-0180 [email protected]; [email protected] Of Counsel for Appellee Barry Keith Patterson
Mark P. Stopa Florida Bar No. 550507 STOPA LAW FIRM 2202 N. West Shore Blvd., Ste 200 Tampa, FL 33607 Tel: (727) 851-9551 [email protected] Counsel for Appellee Barry Keith Patterson
TABLE OF CONTENTS
TABLE OF AUTHORITIES ....................................................................... iii-viii STATEMENT OF THE CASE .................................................................... 1 SUMMARY OF ARGUMENT .................................................................... 4 ARGUMENT ................................................................................................. 5 I. THE BANK FAILED TO PRESERVE THE ARGUMENTS IT NOW RAISES ............................................................................... 5 II. PATTERSON’S SUMMARY JUDGMENT MOTION WAS PROPERLY BEFORE THE COURT ............................................. 8 III. SUMMARY JUDGMENT WAS PROPERLY GRANTED GIVEN THE ABSENCE OF OPPOSING EVIDENCE ................. 13 IV. THE SUBJECT LETTER DID NOT COMPLY WITH THE TERMS OF PARAGRAPH 22 OF THE MORTGAGE ................. 22
A. The letter fails to inform Patterson of the right to assert defenses in the foreclosure proceeding, instead counseling Patterson to bring a separate court action ................................ 27
B. The letter did not specify the action required to cure the default......................................................................... 30
C. The letter did not specify the default. ...................................... 32
D. The out of state and trial court cases cited by the bank are not persuasive here ............................................................. 33
CONCLUSION .............................................................................................. 35
i
CERTIFICATE OF SERVICE ................................................................... 36 CERTIFICATE OF FONT COMPLIANCE ............................................. 36
ii
TABLE OF AUTHORITIES
Abrams v. Paul, 453 So. 2d 826 (Fla. 1st DCA 1984) .................................................... 12-13 Aills v Boemi, 29 So. 3d 1105 (Fla. 2010) ................................................................... 5 Allstate Floridian Ins. Co. v. Farmer, 104 So. 3d 1242 (Fla. 5th DCA 2012) .................................................. 20 Anderson v. State, 93 So. 3d 1201 (Fla. 1st DCA 2012) .................................................... 20 Applegate v. Barnett Bank of Tallahassee, 377 So. 2d 1150 (Fla. 1979) ................................................................. 5 Asset Mgmt. Consults. of Virginia, Inc. v. City of Tamarac, 913 So. 2d 1179 (Fla. 4th DCA 2005) .................................................. 7 Ballinger v. Bay Gulf Credit Union, 51 So. 3d 528 (Fla. 2d DCA 2010) ....................................................... 17 Breed Technologies, Inc. v. AlliedSignal, Inc., 861 So. 2d 1227 (Fla. 2d DCA 2003) ................................................... 33 Bryson v. Branch Banking and Trust Co., 75 So. 3d 783 (Fla. 2d DCA 2011) ....................................................... 13, 22 Caraffa v. Carnival Corp., 34 So. 3d 127 (Fla. 3d DCA 2010) ....................................................... 13 Cerron v. GMAC Mortgage, LLC, 93 So. 3d 456 (Fla. 2d DCA 2012) ....................................................... 13, 22
iii
City of West Palm Beach v. Roberts, 72 So. 3d 294 (Fla. 4th DCA 2011) ...................................................... 19 Cohen v. Rothman, 127 So. 2d 143 (Fla. 3d DCA 1961) ..................................................... 20 Congress Office Park Condos II, LLC v. First-Citizens Bank & Trust Co., 105 So. 3d 602 (Fla. 4th DCA 2013) .................................................... 18 Coral Ridge Properties, Inc. v. Playa Del Mar Ass'n, Inc., 505 So. 2d 414 (Fla. 1987) ................................................................... 10-12 Dade County Sch. Bd. v. Radio Station WQBA, 731 So. 2d 638 (Fla. 1999) ................................................................... 32, 33 David v. Sun. Fed. Savings & Loan Ass'n, 461 So. 2d 93 (Fla. 1984) .................................................................... 25 DiSalvo v. SunTrust Mortgage, Inc., 115 So. 3d 438 (Fla. 2d DCA 2013) ..................................................... 13, 22 Dominko v. Wells Fargo Bank, N.A., 102 So. 3d 696 (Fla. 4th DCA 2012) .................................................... 13, 22 Estate of Willis v. Gaffney, 677 So. 2d 949 (Fla. 2d DCA 1996) ..................................................... 8 First N. American v. Hummel, 825 So. 2d 502 (Fla. 2d DCA 2002) ..................................................... passim Florida League of Cities v. Smith, 607 So. 2d 397 (Fla. 1992) ................................................................... 30-31 Frost v. Regions Bank, 15 So. 3d 905 (Fla. 4th DCA 2009) ...................................................... 14, 22
iv
Geer v. Jacobson, 880 So. 2d 717 (Fla. 2d DCA 2004) ..................................................... 12 Goldman v. State Farm Fire Gen. Ins. Co., 660 So. 2d 300 (Fla. 4th DCA 1995) .................................................... 25-26 Gonsharuk v. HSBC Mortgage Services, Inc., 62 So. 3d 680 (Fla. 2d DCA 2011 ........................................................ passim Haberl v. 21ST Mortg. Corp., 138 So. 3d 1192 (Fla. 5th DCA 2014) .................................................. passim Hagood v. Wells Fargo, N.A., 112 So. 3d 770 (Fla. 5th DCA 2014) .................................................... 19 Hamilton Constr. Co. v. Bd. of Public Instruction of Dade County, 65 So. 2d 729 (Fla. 1953) ..................................................................... 16 Harris v. Wilson, 656 So. 2d 512 (Fla. 1st DCA 1995) .................................................... 16 Hoskins v. State, 75 So. 3d 250 (Fla. 2011) ..................................................................... 19 In re Demers, 2014 WL 2620961 (Bankr. D.R.I. 2014) .............................................. 29 J.A.B. Enters. v. Gibbons, 596 So. 2d 1247 (Fla. 4th DCA 1992) .................................................. 19 Judy v. MSMC Venture, LLC, 100 So. 3d 1287 (Fla. 2d DCA 2012) ................................................... passim Konsulian v. Busey Bank, N.A., 61 So. 3d 1283 (Fla. 2d DCA 2011) ..................................................... passim
v
Kurian v. Wells Fargo Bank, N.A., 114 So. 3d 1052 (Fla. 4th DCA 2013) .................................................. passim Landers v. Milton, 370 So. 2d 368 (Fla. 1979) ................................................................... 18 Laurencio v. Deutsche Bank Nat’l Trust Co., 65 So. 3d 1190 (Fla. 3d DCA 2011) ..................................................... passim Lazuran v. Citimortgage, Inc., 35 So. 3d 189 (Fla. 4th DCA 2010) ...................................................... 14, 22 Lindgren v. Deutsche Bank Nat'l Trust Co., 115 So. 3d 1076 (Fla. 4th DCA 2013) .................................................. 17 Martinez v. Fraxedas, 678 So. 2d 489 (Fla. 3d DA 1996) ....................................................... 9-10 McDaniel v. Liberty Nat. Life Ins. Co., 722 So. 2d 865 (Fla. 5th DCA 1998) .................................................... passim Midtown Enterprises, Inc. v. Local Contractors, Inc., 750 So. 2d 683 (Fla. 3d DCA 2000) ..................................................... 31-32 On Target, Inc. v. Allstate Floridian Ins. Co., 23 So. 3d 180 (Fla. 2d DCA 2009) ....................................................... passim Opella v. Bayview Loan Servicing, LLC, 48 So. 3d 185 (Fla. 3d DCA 2010) ....................................................... 10 Peach State Roofing, Inc. v. 2224 South Trail Corp., 3 So. 3d 442 (Fla. 2d DCA 2009) ......................................................... 25 Pino v. Lopez, 361 So. 3d 192 (Fla. 3d DCA 1978) ..................................................... 17
vi
Pollock v. Danner, 98 So. 3d 650 (Fla. 2d DCA 2012) ....................................................... 32, 33 Robertson v. State, 829 So. 2d 901 (Fla. 2002) ................................................................... 18 Rollins v. Rollins, 783 So. 2d 1114 (Fla. 1st DCA 2001) .................................................. 5-6 Rose v. Clements, 973 So. 2d 529 (Fla. 1st DCA 2007) .................................................... 6-7 Saka v. Saka, 831 So. 2d 709 (Fla. 3d DCA 2002) ..................................................... 5 Samaroo v. Wells Fargo Bank, 137 So. 3d 1127 (Fla. 5th DCA 2014) .................................................. passim Sandoro v. HSBC Bank, USA, N.A., 55 So. 3d 730 (Fla. 2d DCA 2011) ....................................................... 14, 22 State v. Osvath, 661 So. 2d 1252 (Fla. 3d DCA 1995) ................................................... 6 Taylor v. Bayview Loan Servicing, LLC, 74 So. 3d 1115 (Fla. 2d DCA 2011) ..................................................... 14, 22 U.S. Bank Nat. Ass'n v. Busquets, 135 So. 3d 488 (Fla. 2d DCA 2014) ..................................................... 24 Valencia v. Deutsche Bank Nat’l Trust Co., 67 So. 3d 325 (Fla. 4th DCA 2011) ...................................................... 14, 22 Vives v. Wells Fargo Bank, N.A., 128 So. 3d 9 (Fla. 3d DCA 2012) ......................................................... 20
vii
Volusia County v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126 (Fla. 2000) ................................................................... 8 Whistler's Park, Inc. v. Florida Ins. Guaranty, 90 So. 3d 841 (Fla. 5th DCA 2011) ...................................................... 8-9, 15 Wright v. Life Ins. Co. of Georgia, 762 So. 2d 992 (Fla. 4th DCA 2000) .................................................... 9 Wroblewski v. American Home Mortgage Servicing, Inc., 68 So. 3d 431 (Fla. 5th DCA 2011) ...................................................... 14, 22 Fla.R.Civ.P. 1.110 ........................................................................................... 9 Fla.R.Civ.P. 1.510 ........................................................................................... passim
viii
STATEMENT OF THE CASE AND FACTS
In its statement of facts in the Initial Brief, Appellant, Deutsche Bank
National Trust Co. (“the Bank”), generally sets forth the procedural history of the
case, but the Bank’s statement contains several glaring omissions, misstatements,
and understatements that merit clarification.
First, Appellee Barry Keith Patterson (“Patterson”) emphasizes that the
Bank did not provide this Court with a transcript of the summary judgment hearing
which gave rise to the Order on review, nor did the Bank re-create the record.
Thus, the Bank has failed to provide this Court with any record of what it argued
before the trial court.
Second, the Bank designated no summary judgment evidence in opposition
to Patterson’s summary judgment motion under Fla.R.Civ.P. 1.510(c) and filed no
opposing affidavits or any other summary judgment evidence. Yes, the Bank filed
a “Memorandum in Opposition to Defendants Motion for Summary Judgment or
Motion to Dismiss,” which attached a copy of a letter. R.160-69. However, the
Bank did not authenticate the letter, attach it to any affidavit, or file any summary
judgment evidence reflecting the letter was sent. Even upon filing a written
opposition to Patterson’s Amended Motion for Summary Judgment, R.190-227,
and again in seeking rehearing of the trial court’s initial ruling in Patterson’s favor,
1
R.228-237, the Bank filed nothing sworn and nothing supporting its assertion the
letter was sent. While the Bank alleges in passing the Amended Complaint was
verified, that “verification” was done on “knowledge and belief,” not the summary
judgment standard in Fla.R.Civ.P. 1.510. R.92-125.
Finally, the Bank’s Statement of the Case fails to set out either the language
of the Mortgage that creates the condition precedent, or the language of the letter
the Bank claimed (via unsworn assertions) it sent. Paragraph 22 of the Mortgage is
the only paragraph of the entire Mortgage set out entirely in bold print. R.55-69.
The paragraph reads:
22. Acceleration; Remedies. Lender shall give notice to Borrower prior to acceleration following Borrower's breach of any covenant or agreement in this Security Instrument (but not prior to acceleration under Section 18 unless Applicable Law provides otherwise). The notice shall specify: (a) the default; (b) the action required to cure the default; (c) a date, not less than 30 days from the date the notice is given to Borrower, by which the default must be cured; and (d) that failure to cure the default on or before the date specified in the notice may result in acceleration of the sums secured by this Security Instrument, foreclosure by judicial proceeding and sale of the Property. The notice shall further inform Borrower of the right to reinstate after acceleration and the right to assert in the foreclosure proceeding the non-existence of a default or any other defense of Borrower to acceleration and foreclosure. If the default is not cured on or before the date specified in the notice, Lender at its option may require immediate payment in full of all sums secured by this Security Instrument without further demand and may foreclose this Security Instrument by judicial proceeding. …
2
R.67 (emphasis in original). Patterson argued and swore that he did not receive
any notice. See R.182-89 (motion); R.179-81 (supporting affidavit). Patterson’s
amended affidavit stated that Patterson had “never received any such notice” and
had “never been given any default or given any notice of any alleged default on my
mortgage or an opportunity to cure said default.” R.180. The Bank did not supply
any counter-affidavit, and instead merely referenced the letter it had attached to its
previous memo. R.190-227.
The unauthenticated and inadmissible letter did not, however, meet the
requirements of paragraph 22 even if it had been properly before the trial court.
Compare R.67 to R.163. For example, the letter stated “Your loan is in default
because you have not made the required payments when they came due,” but failed
to set out the precise amount the recipient had to pay to cure the default, instead
directing:
“Because of interest, late charges, and other charges that may vary from day to day, the amount due on the day you pay may be greater. Hence, if you pay the amount shown above, an adjustment may be necessary after we receive your check, in which event we will inform you before depositing the check for collection. For further information, write Saxon at the address below or call…
R. 163 (underline added).
3
SUMMARY OF THE ARGUMENT
The Bank failed to preserve the arguments it now makes on appeal, as it has
no transcript of the hearing below and did not even try to re-create the record.
Moreover, many of the Bank’s arguments are clearly not contained within the
written memoranda it filed in the lower court.
The Bank acts as if there were procedural improprieties about the manner in
which the lower court dismissed this case, but that is simply not so. Patterson was
entitled to move for summary judgment before filing an Answer, and his pro se
letter directed to a prior version of the Complaint did not waive that right. Try as it
might, the Bank cannot avoid one, inescapable conclusion – Patterson met his
summary judgment burden by filing a supporting affidavit (showing the requisite,
Paragraph 22 notice was not given), and the Bank filed no summary judgment
evidence in opposition.
The Bank cannot argue before this Court that the paragraph 22 notice it
purportedly sent created an issue of fact before the trial court, because it never
proffered admissible evidence of any such letter. Even if it could, however, that
letter did not comply with the requirements of paragraph 22 of the Mortgage
contract or Florida law.
For all of these reasons, the Order on review should be affirmed.
4
STANDARD OF REVIEW
Patterson agrees the Order at bar is reviewed de novo. See Volusia County
v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126, 130 (Fla. 2000) (applying de
novo standard to summary judgment ruling). Moreover, “a decision interpreting a
contract presents an issue of law that is reviewable by the de novo standard of
review.” On Target, Inc. v. Allstate Floridian Ins. Co., 23 So. 3d 180, 182 (Fla. 2d
DCA 2009).
ARGUMENT
I. THE BANK FAILED TO PRESERVE THE ARGUMENTS IT NOW RAISES.
Florida law requires appellants to show the errors about which they
complain on appeal were preserved for review. See Aills v. Boemi, 29 So. 3d 1105
(Fla. 2010) (setting forth three requirements for preservation of error).1 As many
Florida courts have explained, this requires appellants to present a transcript of the
hearing or to re-create the record. See Applegate v. Barnett Bank of Tallahassee,
377 So. 2d 1150 (Fla. 1979). In the words of the First District:
No transcript of the hearing was provided because there was no court reporter present at the hearing. There was no statement of the evidence as permitted by Fla.R.App.P. 9.200(b)(4). Accordingly,
1 The only exception, when there is “fundamental error,” plainly does not apply here. See State v. Osvath, 661 So. 2d 1252 (Fla. 3d DCA 1995).
5
appellate review is precluded and we are unable to ascertain whether the trial court erred. See Mead v. Mead, 726 So. 2d 865 (Fla. 1st DCA 1999); Starks v. Starks, 423 So. 2d 452, 454 (Fla. 1st DCA 1983) (“Litigants who proceed … without a court reporter take a calculated risk. If the facts are determined adversely they may well be unable to demonstrate error on appeal due to the absence of a record.”).
Rollins v. Rollins, 783 So. 2d 1114 (Fla. 1st DCA 2001); see also Saka v. Saka,
831 So. 2d 709 (Fla. 3d DCA 2002); State v. Osvath, 661 So. 2d 1252, 1254 (Fla.
3d DCA 1995) (“an appellate court must confine the parties litigant to the points
raised and determined in the court below, and must not permit the presentation of
points, or objections for the first time in the appellate court”).
The fact that the Order on review emanates from a summary judgment
hearing (as opposed to an evidentiary hearing or trial) does not change the Bank’s
obligation in this regard. As the First District has explained:
After discovering that the record on appeal did not contain a transcript of the summary judgment hearing, this court issued an order directing Appellants to supplement the record pursuant to Florida Rule of Appellate Procedure 9.200(f)(2) with this information. Appellants did not file a transcript or a reconstructed record in response to this order. Due to the insufficient record, this court is unable to determine on what basis, if any, Appellants argued against the motion for summary judgment because the hearing on this motion was not recorded. Thus, this court is unable to review the factual or legal basis for the trial court’s decision.
Rose v. Clements, 973 So. 2d 529, 530 (Fla. 1st DCA 2007) (internal citations
6
omitted); see also Asset Mgmt. Consults. of Virginia, Inc. v. City of Tamarac, 913
So. 2d 1179, 1180 (Fla. 4th DCA 2005) (“There is no transcript of the summary
judgment hearing, so it is unknown if [appellant argued the issue on appeal] at the
hearing.”).
The Bank made multiple, written submissions in opposition to summary
judgment, R.160-69 (memo in opposition to defendant’s initial motion for
summary judgment); R.190-227 (memo in opposition to defendant’s amended
motion for summary judgment); R.228-237 (Plaintiff’s Motion for Rehearing), yet
nowhere in these written submissions (and certainly not at the hearing, for which
the Bank has no transcript), did the Bank raise the issues about which it now
complains. In particular, the Bank did not argue: (i) Patterson waived the
arguments at bar by filing a pro se response to the original Complaint (IB at 11-
13); (ii) Patterson could not obtain summary judgment because he did not
specifically deny conditions precedent in an Answer (IB at 11-12); (iii) the trial
court somehow incorrectly resolved a factual dispute (IB at 13-17); or (iv)
Patterson was not prejudiced by the defects in the letter in question (IB at 15-16).
Under the controlling authorities cited herein, this Court must reject these
arguments without further discussion.
7
II. PATTERSON’S SUMMARY JUDGMENT MOTION WAS PROPERLY BEFORE THE COURT.
The Bank would have this Court believe there is some type of confusion as
to the procedural manner in which the Order on review was entered. That is
simply not so. Though the motion at bar was entitled a “Motion to Dismiss or for
Summary Judgment,” R.151-157, the Order on review plainly reflects the lower
court’s granting of the summary judgment portion of the motion based on the
Bank’s failure to meet the conditions precedent found in paragraph 22 of the
Mortgage. See Estate of Willis v. Gaffney, 677 So. 2d 949, 951 (Fla. 2d DCA
1996) (court must analyze the substance of a motion rather than its label). Plus, the
Bank appropriately acknowledged, in seeking rehearing, that the lower court had
granted summary judgment. R.228-234 (asking trial court to reconsider “the order
granting Defendant’s motion for summary judgment”).
While the Order on review imposed a remedy of dismissal, that is the
appropriate remedy whenever a defendant prevails on summary judgment for
failure to comply with conditions precedent. See e.g. Whistler’s Park, Inc. v.
Florida Ins. Guaranty, 90 So. 3d 841 (Fla. 5th DCA 2011) (granting summary
judgment in favor of insurer given insured’s failure to comply with conditions
precedent, but explaining “dismissal without prejudice to allow belated compliance
8
with the EUO provision is the most prudent course of action”); Wright v. Life Ins.
Co. of Georgia, 762 So. 2d 992 (Fla. 4th DCA 2000). Quite simply, the Bank’s
failure to give the requisite, paragraph 22 notice before filing the subject lawsuit
does not prevent the Bank from ever suing again, i.e. it does not give rise to a
judgment on the merits. Rather, the Bank’s undisputed failure to provide that
notice required this case be dismissed without prejudice to the Bank filing a new
lawsuit, id., just as the lower court ruled.2
The Bank also contends Patterson waived his summary judgment argument
by filing a pro se “Answer” to the original Complaint, which “Answer” did not
specifically deny conditions precedent. Its failure to preserve this argument aside,
see Issue I, supra, the Bank is wrong for multiple reasons.
First, Patterson’s pro se response to the original Complaint was not an
Answer at all, but merely a letter. See Fla.R.Civ.P. 1.110(c) (defines what
constitutes an answer). The only case the Bank cites arguing its position otherwise
is Martinez v. Fraxedas, 678 So. 2d 489, 491 (Fla. 3d DCA 1996). That case,
however, actually supports Patterson’s position. In Martinez, the Third District
2 The undersigned has obtained this result approximately 400 times in mortgage foreclosure cases and can scarcely recall and bank lawyer ever even arguing for a contrary result. Clearly, if the paragraph 22 condition precedent is not satisfied, and the homeowner proves it at summary judgment, the remedy is dismissal without prejudice.
9
held that a pro se response to the complaint requesting appointment of counsel
should not have been treated as an Answer (as defined by the Florida Rules of
Civil Procedure), but rather as a motion for appointment of counsel. Id. at 491.
Here, too, the handwritten letter filed by Patterson – in which he simply stated “I
request that my response to said complaint be observed. I wish to have my side
heard in this case,” R.40 – is not an Answer. See also Vives v. Wells Fargo Bank,
N.A., 128 So. 3d 9 (Fla. 3d DCA 2012) (pro se letter was not an Answer); Opella
v. Bayview Loan Servicing, LLC, 48 So. 3d 185 (Fla. 3d DCA 2010) (same).
Tellingly, this letter was not docketed as an Answer by the Clerk, either. See
Index to Record (referring to “RESPONSE OF BARRY PATTERSON”).
As Patterson’s pro se response was not an Answer, but merely a paper,
Patterson did not waive anything by not specifically denying conditions precedent
in that response. The Bank would have this Court believe otherwise, arguing
Patterson was obligated to file an Answer (with this specific denial) before moving
for summary judgment. That contention, however, is simply wrong.
In 1987, the Florida Supreme Court tracked the language of Fla.R.Civ.P.
1.510 and ruled a defendant can move for summary judgment “at any time,”
without having filed an Answer, even where that motion is predicated on an
affirmative defense that would traditionally have to be pled. Coral Ridge
10
Properties, Inc. v. Playa Del Mar Ass’n, Inc., 505 So. 2d 414, 417 (Fla. 1987). In
so holding, the Court explained:
We first address the issue of whether a defendant may file a motion for summary judgment based on release without first asserting that affirmative defense in an answer. Under rule 1.110, a pleading in response to a previous pleading must affirmatively set forth all affirmative defenses on which the pleader plans to rely. The objective of this requirement is to timely present and join the issues on which the parties will rely and to preserve issues for appellate review. Wise v. Quina, 174 So. 3d 590 (Fla. 1st DCA 1965). The rule does not, on its face, require that motions for summary judgment based on affirmative defenses be preceded by an answer in which the affirmative defense is pleaded. Further, reading the rule to require filing an answer prior to a motion for summary judgment, would be contrary to Florida Rule of Civil Procedure 1.510(b) which permits a motion for summary judgment at any time. Thus, contrary to the district court below, we conclude that there is no requirement that a motion for summary judgment under rule 1.510(b) be preceded by an answer presenting the affirmative defense under rule 1.110(d). This conclusion is consistent with Florida Rule of Civil Procedure 1.140(b) which permits certain defenses to be made by motion prior to the filing of a responsive pleading. The requirement in rule 1.140(b) that every defense in law or fact be asserted in the responsive pleading is qualified by the caveat “if one is required.” When a suit is disposed of, as here, by summary judgment, there is no requirement that a responsive pleading be filed.
Respondent also urges that it was prejudiced by the failure of petitioners to present the affirmative defense of release in a responsive pleading prior to the motion for summary judgment. We see no prejudice to a plaintiff when, by its terms, rule 1.510(c) requires that the motion for summary judgment “state with particularity the grounds upon which it is based and the substantial matters of law to be argued” and that the motion “be served at least twenty days before the time fixed for the hearing.” Filing a responsive pleading with the same information prior to the motion for summary judgment would
11
not benefit the plaintiff. Regardless of whether the motion for summary judgment was presented before or after a responsive pleading, respondent was required to present an avoidance of the release. We do not agree that the order of presentation was prejudicial.
Id. Here, Patterson had not filed an Answer, either in response to the original
Complaint or the Amended Complaint, and he specifically denied compliance with
the conditions precedent via his summary judgment motion, just as the law allows.
See Coral Ridge. As such, Patterson waived nothing by not specifically denying
conditions precedent in an Answer. The Bank’s argument otherwise is incorrect.3
Even if Patterson’s response to the original Complaint could somehow be
deemed an Answer, Patterson cannot be said to have waived his summary
judgment arguments in response to the Amended Complaint by virtue thereof.
After all, under established Florida law, Patterson’s pro se response to the original
Complaint did not carry over to the Amended Complaint. Geer v. Jacobsen, 880
So. 2d 717, 720 (Fla. 2d DCA 2004); Abrams v. Paul, 453 So. 2d 826, 827 (Fla. 1st
DCA 1984) (“the answer to the original complaint did not carry over so as to be
3 The cases cited by the Bank are inapposite, as, in those cases, the defendant had already filed an Answer yet failed to specifically deny the condition precedent in question in that Answer. See Ingersoll v. Hoffman, 589 So. 2d 223 (Fla. 1991); Scarborough Assocs. v. Financial Fed. Sav. & Loan Ass’n of Dade Cty, 647 So. 2d 1001 (Fla. 3d DCA 1994). There is clearly a difference between a defendant filing an Answer and failing to specifically deny conditions precedent and a defendant who has not yet been required to Answer because the case has not yet reached that procedural posture. See Coral Ridge.
12
considered a response to the amended complaint.”). In short, “[p]rior pleadings are
superseded by the amendment.” Caraffa v. Carnival Corp., 34 So. 3d 127, 130 (Fla.
3d DCA 2010). The Bank’s argument otherwise, made, tellingly, without any
legal citations, is misguided.
In light hereof, Patterson’s summary judgment motion was procedurally
proper and appropriately adjudicated by the lower court. The Bank’s contentions
otherwise are not even worthy of written opinion. This Court should affirm.
III. SUMMARY JUDGMENT WAS PROPERLY GRANTED GIVEN THE ABSENCE OF OPPOSING EVIDENCE.
Florida courts have long recognized that paragraph 22 of the standard,
Fannie Mae mortgage operates as a condition precedent to acceleration and
foreclosure, precluding foreclosure where a plaintiff did not comply. See Haberl v.
21ST Mortg. Corp., 138 So. 3d 1192 (Fla. 5th DCA 2014); Samaroo v. Wells
Fargo Bank, 137 So. 3d 1127, 1128 (Fla. 5th DCA 2014); DiSalvo v. SunTrust
Mortgage, Inc., 115 So. 3d 438 (Fla. 2d DCA 2013); Kurian v. Wells Fargo Bank,
N.A., 114 So. 3d 1052 (Fla. 4th DCA 2013); Dominko v. Wells Fargo Bank, N.A.,
102 So. 3d 696 (Fla. 4th DCA 2012); Cerron v. GMAC Mortgage, LLC, 93 So. 3d
456 (Fla. 2d DCA 2012); Judy v. MSMC Venture, LLC, 100 So. 3d 1287 (Fla. 2d
DCA 2012); Bryson v. Branch Banking and Trust Co., 75 So. 3d 783 (Fla. 2d DCA
13
2011); Taylor v. Bayview Loan Servicing, LLC, 74 So. 3d 1115 (Fla. 2d DCA
2011); Wroblewski v. American Home Mortgage Servicing, Inc., 68 So. 3d 431
(Fla. 5th DCA 2011); Valencia v. Deutsche Bank Nat’l Trust Co., 67 So. 3d 325
(Fla. 4th DCA 2011); Laurencio v. Deutsche Bank Nat’l Trust Co., 65 So. 3d 1190
(Fla. 2d DCA 2011); Goncharuk v. HSBC Mortgage Services, Inc., 62 So. 3d 680
(Fla. 2d DCA 2011); Konsulian v. Busey Bank, N.A., 61 So. 3d 1283 (Fla. 2d
DCA 2011); Sandoro v. HSBC Bank, USA N.A., 55 So.3d 730 (Fla. 2d DCA
2011); Lazuran v. Citimortgage, Inc., 35 So. 3d 189 (Fla. 4th DCA 2010); Frost v.
Regions Bank, 15 So. 3d 905 (Fla. 4th DCA 2009).
Paragraph 22 of the mortgage in question contains these same notice
requirements. R.92-125 (Mortgage, ¶ 22). Where the undisputed, summary
judgment evidence shows the Bank did not comply, R.171-172, this Court should
follow the rulings of these cases and affirm. It is really that simple.
The only aspect of this case that may make it appear different than these
other, paragraph 22 cases is that Patterson did not defeat the Bank’s summary
judgment based on paragraph 22 non-compliance; he obtained a summary
judgment of his own. Even if that could be said to be a distinction, however, it is a
distinction without a difference.
Florida law has long recognized that dismissal of a lawsuit without prejudice
14
to re-filing a new suit is an appropriate result where a plaintiff does not prove
compliance with a requisite condition precedent. See Whistler’s Park, 90 So. 3d at
846. Significantly, the Bank does not disagree with that proposition of law. The
Bank does not contend paragraph 22 is not a condition precedent in this case. The
Bank does not argue summary judgment is not the proper vehicle for relief when a
foreclosure plaintiff fails to comply with paragraph 22. The Bank does not
complain about insufficient notice or any other such procedural issue, either.
Rather, the Bank spends much of its Initial Brief arguing the content of the
paragraph 22 letter itself. This Court, however, cannot even reach that question
because the letter at bar was not properly considered at a summary judgment
hearing.
In First N. American v. Hummel, the county court had granted summary
judgment in the face of unauthenticated letters filed in opposition. 825 So. 2d 502
(Fla. 2d DCA 2002). The circuit court reversed, finding those letters created
material issues of fact, but this Court quashed that ruling on certiorari, finding
summary judgment was properly granted, explaining:
In seeking summary judgment, FNANB met its burden by filing a supporting affidavit. See Fla.R.Civ.P. 1.510. Hummel did not file any affidavits or other admissible evidence in opposition to FNANB's motion, and the pleadings and discovery contained in the record did not otherwise show the existence of a genuine issue of material fact.
15
While Hummel filed three documents with the county court, the documents were not authenticated or supported by any affidavit or other evidentiary proof. See Daeda v. Blue Cross & Blue Shield of Fla., Inc., 698 So. 2d 617, 618 (Fla. 2d DCA 1997); Harris v. Wilson, 656 So. 2d 512, 517 (Fla. 1st DCA 1995). Therefore, based on the record properly before it, the county court correctly granted summary judgment. See Fleming v. Peoples First Fin. Sav. & Loan Ass’n, 667 So. 2d 273 (Fla. 1st DCA 1995); DeMesme v. Stephenson, 498 So. 2d 673, 675 (Fla. 1st DCA 1986).
By relying on the unauthenticated documents to reverse the county court, the circuit court did not apply the correct law governing summary judgment proceedings. Therefore, we grant FNANB's petition for writ of certiorari, quash the decision of the circuit court, and reinstate the final judgment of the county court.
Id. at 503-504; see also Harris v. Wilson, 656 So. 2d 512, 517 (Fla. 1st DCA 1995)
approved, 693 So. 2d 945 (Fla. 1997) (upholding summary judgment in
defendant’s favor where plaintiff filed unsworn and unauthenticated documents in
opposition to summary judgment).
Hummel is controlling on the facts at bar. The Bank’s mere filing of a
paragraph 22 letter, without an affidavit authenticating that letter and averring that
letter was sent, does not create an issue of fact. Patterson met his burden for
summary judgment by filing the affidavit reflecting the absence of such a notice,
R.171-172; 179-181, and the Bank filed no summary judgment evidence to the
contrary. As such, there were no disputed issues of fact vis a vis the Bank’s failure
16
to comply with the conditions precedent in paragraph 22 of the subject mortgage.
The lower court’s Order was correct and this Court should affirm.
The Bank may argue otherwise by pointing to the “verified” complaint.
Established law, however, is clear. A “verification” done on “knowledge and
belief” is not summary judgment evidence and cannot be considered for summary
judgment purposes. See Ballinger v. Bay Gulf Credit Union, 51 So. 3d 528 (Fla.
2d DCA 2010) (“The qualified verification here fails to meet the requirements of
rule 1.510(e) and, therefore, should not have been considered by the trial court on a
motion for summary judgment.”); Lindgren v. Deutsche Bank Nat’l Trust Co., 115
So. 3d 1076 (Fla. 4th DCA 2013) (following Ballinger in the context of a
“knowledge and belief” verification in a mortgage foreclosure case). Hence, the
fact the Complaint was verified under Rule 1.110(b) does not save the Bank for
purposes of summary judgment.4
The Bank may persist in ruling otherwise because the Order on review
actually considered the content of the letter (and did not exclude the letter for
4 Even if the Complaint had been verified under the summary judgment standard, it would not create an issue of fact because the allegation that the Bank “complied with all conditions precedent is purely a legal conclusion. See Pino v. Lopez, 361 So. 3d 192 (Fla. 3d DCA 1978) (“Plaintiff’s affidavit in opposition to the motion for summary judgment was insufficient as a matter of law because it alleged conclusions of law without supporting facts.”).
17
summary judgment purposes, as Patterson urges here). Any such argument would
be unavailing. When a trial court reaches the right result, even if it is for the wrong
reasons, the appellate court should affirm so long as “there is any basis which
would support the judgment in the record.” Robertson v. State, 829 So. 2d 901,
906 (Fla. 2002) (explaining the so-called tipsy coachman doctrine). Once
Patterson tendered competent evidence, in the form of his affidavit, to support his
motion, the bank had a duty to come forward with evidence sufficient to create a
genuine issue of fact. See Landers v. Milton, 370 So. 2d 368, 370 (Fla. 1979)
(describing evidentiary burden on non-movant facing summary judgment). As the
Fourth District Court of Appeal has lamented, a “common problem we encounter
in mortgage foreclosure appeals is that the appellant slings legal terminology in a
brief…without tying the legal concept to any set of real-world facts established in
the trial court.” Cong. Park Office Condos II, LLC v. First-Citizens Bank & Trust
Co., 105 So. 3d 602, 610 (Fla. 4th DCA 2013), reh’g denied (Feb. 13, 2013). Such
is the case here. The Bank slinks all sorts of legal terminology, such as
“substantial compliance” and “lack of prejudice,” without grounding any of those
arguments in record facts. When faced with such a situation, “the duty rests upon
the appealing party to make error clearly appear.” Id. But the bank failed to bring
forth any evidence, and therefore to make any error “clearly appear.” The Court
18
should therefore affirm without even considering the language of the purported
letter. The record simply does not support any other result.5
Another way to look at the Bank’s attempt for this Court (and, for that
matter, the lower court) to consider the content of the paragraph 22 letter is under
the doctrine of invited error. Under established law, the Bank should not be
permitted to ask the lower court to err by considering the content of the letter at
summary judgment,6 see Hummel, then argue the court erred in its consideration of
5 The Bank may want to argue, on Reply, that paragraph 15 of the Mortgage only required it to “send” the paragraph 22 letter and that Patterson’s affidavit showing non-receipt did not prove the letter was not sent. Such an argument must fail, for several reasons. First, this argument was not raised below and is hence not preserved. See Issue I of this Answer Brief, supra. Second, this argument cannot be raised for the first time in a Reply Brief. See Hoskins v. State, 75 So. 3d 250 (Fla. 2011); Hagood v. Wells Fargo, N.A., 112 So. 3d 770 (Fla. 5th DCA 2014); J.A.B. Enters. v. Gibbons, 596 So. 2d 1247 (Fla. 4th DCA 1992) (“[A]n issue not raised in an initial brief is deemed abandoned and may not be raised for the first time in a reply brief.”). Third, the Bank did not designate paragraph 15 of the Mortgage as summary judgment evidence in the lower court, so it cannot rely upon such to oppose the granting of that motion. See Fla.R.Civ.P. 1.510(c). Fourth, proof that the Paragraph 22 notice was not received proves the notice was not sent, see City of West Palm Beach v. Roberts, 72 So. 3d 294, 298 (Fla. 4th DCA 2011) (holding “the City had not sent the proper notice to the Robertses” based on “Mr. Roberts [testimony] that he had not received any notice”), and where that testimony is undisputed, it carries the day. 6 Remember, absolutely none of the Bank’s filings in the lower court reflect it made any objection to the lower court’s consideration of the content of the letter. In fact, it was the Bank which asked the court to consider the letter by filing it with its written memoranda.
19
that letter. Anderson v. State, 93 So. 3d 1201, 1202 (Fla. 1st DCA 2012) (“Under
the invited error doctrine, a party may not make or invite error at trial and then take
advantage of the error on appeal.”). Quite simply, the letter was not properly
considered and the Bank had no summary judgment evidence. This Court should
affirm.
To the extent this Court considers this argument a close call, it should
consider the policy implications of its decision. Florida’s circuit courts are
bursting at the seams with foreclosure cases. The instant case had been pending
for more than four years. Four years! The Bank was aware of its paragraph 22
obligations, yet even when faced with adverse summary judgment and an affidavit
in support, had nothing to present to the lower court to prove compliance with the
requisite conditions precedent. Respectfully, there must come a point in time
where foreclosure plaintiffs like the Bank – plaintiffs which are incessantly
clogging our courts – have to “put up or shut up.”7
In this same vein, this Court should want to encourage litigants like
Patterson to advance foreclosure cases on the merits. The adjudication of cases in
7 Florida’s summary judgment rule allows defendants such as Patterson to move for summary judgment “at any time.” See Fla.R.Civ.P. 1.510. Where Patterson avails herself of Florida procedure to try to adjudicate a four year-old foreclosure case on the merits, the Bank should not get to say “well, I have no proof, but this case should remain pending.”
20
this manner is far easier, and far less of a strain on the system, than having cases
languish for over four years before the lower court sua sponte sets the case for trial
because the Bank refuses to prosecute its own case to judgment (as so often
happens in foreclosure cases like this), only to have the case resolved in the same
manner, i.e. dismissed because the Bank had no paragraph 22 notice.8 9
Where Patterson moved for summary judgment and a supporting affidavit on
a simple, dispositive issue in a case that had been pending for a year, the filing of a
competing affidavit was not much to ask. The summary judgment evidence before
the lower court was undisputed, and this Court should affirm.
8 Often, when homeowners such as Patterson move for summary judgment on an issue like this, the foreclosing plaintiff files a competing affidavit, asserting the paragraph 22 notice had been sent. That did not happen here, of course, but when it happens, that facilitates/expedites the resolution of the case. Given the strain on our courts, this Court should encourage that approach whenever possible. 9 The undersigned apologizes if this Court believes the last few paragraphs of this brief are misplaced. The undersigned struggled on whether to include them but, candidly, has often seen (having litigated many hundreds of foreclosure cases in the past four-plus years) that the adjudication of foreclosure cases sometimes turns on policy decisions and judicial expediency as much as the law. Hence, to the extent this Court believes the appeal herein is a close call, the undersigned thought this Court may want to consider these issues as it renders a decision. If that was in error, the undersigned apologizes.
21
IV. THE SUBJECT LETTER DID NOT COMPLY WITH THE TERMS OF PARAGRAPH 22 OF THE MORTGAGE.
Even if, arguendo, this Court concludes the subject letter constitutes
summary judgment evidence and considers the content thereof for purposes of this
appeal, this Court should still affirm the Order on review because the letter does
not contain the information required by paragraph 22 of the Mortgage.
The Bank argues, throughout its Initial Brief, that “substantial compliance”
is the standard this Court should employ when considering the content of the letter.
That is simply not so.
Florida’s appellate courts have discussed the issue of paragraph 22 in the
mortgage foreclosure context on many occasions. Not once have these courts ever
characterized a lender’s obligations in these regards in terms of “substantial
compliance.” Not once. Haberl, 138 So. 3d at 1192; Samaroo, 137 So. 3d at 1128;
DiSalvo, 115 So. 3d at 438; Kurian, 114 So. 3d at 1053; Dominko, 102 So. 3d at
697; Cerron, 93 So. 3d at 456; Judy, 100 So. 3d at 1289; Bryson, 75 So. 3d at 784;
Taylor, 74 So. 3d at 1115; Wroblewski, 68 So. 3d at 431; Valencia, 67 So. 3d at
325; Laurencio, 65 So. 3d at 1190; Goncharuk, 62 So. 3d at 680; Konsulian, 61 So.
3d at 1283; Sandoro, 55 So. 3d at 730; Lazuran, 35 So. 3d at 189; Frost, 15 So. 3d
at 905.
22
For instance, in Samaroo, the Fifth District held that a paragraph 22 letter
did not “comply” with the terms of the mortgage, rejecting the concept of
“substantial compliance” as “an argument we cannot credit.” 137 So. 3d at 1129.
Likewise, several other decisions have characterized a foreclosure plaintiff’s
obligations vis a vis paragraph 22 in terms of “compliance,” not “substantial
compliance.” Haberl, 138 So. 3d at 1192 (“the notice of default … does not
comply with the pre-acceleration notice requirements set forth in paragraph 22 of
the mortgage”); Kurian, 114 So. 3d at 1055 (“The letter attached to the Complaint
did not satisfy section 22's requirements.”); Judy, 100 So. 3d at 1288; Laurencio,
65 So. 3d at 1191-93 (“Clearly, Deutsche Bank’s letter did not comply with
paragraph 22”).
Tellingly, not one of these cases even mentions the term “substantial
compliance,” “substantially comply,” or any version thereof. Quite simply, this is
not even part of the vernacular when assessing the content of a paragraph 22 letter.
Undaunted by the lack of any case authority whatsoever, the Bank argues
U.S. Bank Nat. Ass'n v. Busquets, 135 So. 3d 488 (Fla. 2d DCA 2014), supports its
position. However, Busquets does not even use the term “substantial compliance”
in the decision. Instead, that narrow decision turned on its facts, i.e. two specific
defects in that letter that this Court found sufficient to comply with paragraph 22.
23
To wit, a “foreclosure proceeding” and “foreclosure by judicial proceeding” are the
same thing in Florida (where only judicial foreclosure takes place), and informing
a borrower he “may” have the right to reinstate complies with paragraph 22
because the right to reinstate is not unequivocal and requires compliance with the
terms of paragraph 19 of the mortgage. Id. at 490. Hence, nothing about Busquets
supports the Bank’s argument for substantial compliance in this case.
Likewise, the Bank’s assertion that prejudice is part of the analysis in the
paragraph 22 context is misguided. As was the case with its “substantial
compliance” argument, not a single case that has addressed paragraph 22 has
employed a prejudice analysis. Not one. See cases (string-cited, supra). As this
Court ruled in Judy (and the cases both before and after Judy), prejudice is simply
not a factor. 100 So. 3d at 1289. Well, technically, this Court did not say
“prejudice is not a factor” in the analysis, but by declining to even discuss the issue
of prejudice in this very context (in Judy or any other paragraph 22 case), that is
what this Court has ruled – prejudice is not a factor.10 Id. That ruling is required,
of course, because paragraph 22 has “clear and unambiguous” terms, Konsulian,
10 It would have been easy for this Court to write an opinion in Judy affirming the foreclosure judgment, even though the paragraph 22 letter lacked the requisite information, because the homeowner was not prejudiced by the defect(s) in the letter. Obviously, this Court declined to do so, reversing the foreclosure judgment where the letter was defective irrespective of any prejudice to the homeowner. Id.
24
supra, so extrinsic evidence is not permitted. Peach State Roofing, Inc. v. 2224
South Trail Corp., 3 So. 3d 442 (Fla. 2d DCA 2009) (“where a contract is clear and
unambiguous, the express contract terms may not be varied by resort to extrinsic
evidence”). As a result, no matter how much the Bank might want to present
evidence on this issue, it is simply not allowed.11
The Bank tacitly admits the language of its pre-suit notice does not actually
comply with the bolded requirements of the mortgage contract. Undoubtedly, this
is why the Bank argues the notice was “close enough” and “substantially complies
11 To the extent the Bank tries to cite case law from the insurance context, such cases are unpersuasive. There, an insurance company is trying to enforce conditions precedent against a consumer/insured in a contract that it (the insurance company) drafted. In that context, i.e. from a consumer protection standpoint, it may make sense to consider prejudice in the analysis against the corporation which drafted the contract. See Goldman v. State Farm Fire Gen. Ins. Co., 660 So. 2d 300, 303 (Fla. 4th DCA 1995) (pointing to a “substantial line of cases support[ing] the rule” that a party to a contract “need not show prejudice” when the other party “breaches conditions precedent to suit.”). Here, on the other hand, the bank is merely being asked to comply with a boldfaced condition precedent in a contract that it drafted. Unlike in the insurance context, there is no reason (e.g. consumer protection) to do anything except force a behemoth financial institution like the Bank from complying with its own contract. See David v. Sun Fed. Savings & Loan Ass’n., 461 So. 2d 93 (Fla. 1984) (even though mortgage foreclosure is an equitable proceeding, the Court recognizes certain situations require the denial of relief, including “where the mortgagee failed to perform some duty upon which the exercise of his right to accelerate was conditioned.”). To rule otherwise, and employ some type of “close enough” standard would run afoul of the “rules” and “predictability on the decision-making process” deemed so critical by the David Court. Id.
25
with each element of paragraph 22 of the Mortgage,” IB at 21, then cites trial court
and out-of-state cases applying a “substantial compliance” standard in other
contexts without even discussing or comparing the language of this default letter it
allegedly sent to the language of this mortgage. See IB at 22-32. Instead, the bank
simply and broadly asserts that the letter is “consistent with the intent” of the
mortgage and leaves it at that. See IB at 22.
But an actual comparison of the language of the mortgage and the letter
shows that the notice letter does not comply with the dictates of the Mortgage.
Specifically, the contract requires, in bold type:
22. Acceleration; Remedies. Lender shall give notice to Borrower prior to acceleration following Borrower's breach of any covenant or agreement in this Security Instrument (but not prior to acceleration under Section 18 unless Applicable Law provides otherwise). The notice shall specify: (a) the default; (b) the action required to cure the default; (c) a date, not less than 30 days from the date the notice is given to Borrower, by which the default must be cured; and (d) that failure to cure the default on or before the date specified in the notice may result in acceleration of the sums secured by this Security Instrument, foreclosure by judicial proceeding and sale of the Property. The notice shall further inform Borrower of the right to reinstate after acceleration and the right to assert in the foreclosure proceeding the non-existence of a default or any other defense of Borrower to acceleration and foreclosure.…
26
R. 67 (emphasis in original).12 As the trial court held, the letter failed to specify
the default, failed to specify the action required to cure the default, and failed to
inform Patterson of the right to assert in the foreclosure proceeding the non-
existence of a default or any other defense. R. 67. As such, this Court should
affirm the Order on review.
A. The letter fails to inform Patterson of the right to assert defenses in the foreclosure proceeding, instead counseling Patterson to bring a separate court action.
The trial court properly held that the Letter sent by the Bank failed to
comply with the dictates of paragraph 22 because the letter failed to “inform
Borrower of …the right to assert in the foreclosure proceeding the non-
existence of a default or any other defense of Borrower to acceleration and
foreclosure” as required by paragraph 22. See R.67 (contract), R.163 (letter),
R.239 (order). Instead of informing this borrower of this right to assert defenses in
the foreclosure proceeding, the letter stated:
You also have the right to bring a court action to assert the nonexistence of a default or any other defense to acceleration that you may have.
12 As noted in the footers of the Mortgage, R. 55-69, the Mortgage in this case is a Florida-specific standard form mortgage, which is used throughout the state of Florida. See e.g., Goncharuk, 62 So. 3d at 681 (describing mortgage at issue in both that case and this one as a “A standard Fannie Mae/Freddie Mac Form 3010 1/01 mortgage”).
27
R. 163 (underline added). By advising the defendant he could “bring a court
action” rather than “assert in the [existing] foreclosure proceeding” his defenses to
acceleration, the Bank gave a notice that is clearly and materially differed from the
notice required by the Bank’s own security instrument. As one trial court has
explained, “[i]n the most fundamental sense there is a world of difference between
having to bring a court action to assert the non existence of a default or any other
defense to acceleration and the right to assert in the foreclosure proceeding the non
existence of a default or any other defense to acceleration. Bank of America, N.A.
v. Casey, No. CACE12003317 at 2 (17th Jud. Cir., Jan. 22, 2013)(Haury, J.) See
Notice of Supplemental Authority. This is because “the former requires
affirmative action on the part of the borrower to file a complaint, which almost all
are ill equipped to do, or pay an attorney to do so.” Id. “It also requires the
payment of a filing fee at a time when the borrower is least capable of doing so. It
is significantly different from taking no action, waiting until the foreclosure
proceeding is filed and then asserting why acceleration is not correct or specifying
other defenses.” As the Casey court concluded, “[t]o equate the two is to ignore
both the terms of plaintiff’s mortgage and the economic burden of the substituted
language.” Id.
28
The Fifth District, adopting this view, recently reversed a summary
judgment of foreclosure entered in favor of the bank where, as here, the pre-suit
notice given failed to inform the borrower of the right to assert in the foreclosure
proceeding, as oppose to in a borrower-initiated court action, the non-existence of
a default or other defense of borrower to acceleration and foreclosure. Haberl, 138
So. 3d 1192 at n.1 (Fla. 5th DCA 2014).
Notably, in non-judicial foreclosure jurisdictions where foreclosure is
accomplished without court action, the “standard” paragraph 22 language is
materially different, in that it expressly requires the bank to notify the borrower of
“the right to bring a court action,” since there is not already a court action required
to foreclosure. See, e.g., In re Demers, BR 13-11539, 2014 WL 2620961 (Bankr.
D.R.I. 2014) (explaining that paragraph 22 of that mortgage requires the lender to
notify the borrower of the “right to bring a court action” and that a notice that
merely informed that the borrower had the right to “argue” and “present” defenses
did not comply with the condition precedent). If there was no material difference
between notifying the borrower of “the right to assert in the foreclosure proceeding
the non-existence of a default or any other defense” and “the right to bring a court
action,” there would be no need for the standard Fannie Mae/Freddie Mac
29
language to change depending on whether the Mortgage is being issued in a
judicial foreclosure state or a non-judicial foreclosure state.
B. The Letter Did Not Specify the Action Required to Cure the Default.
The letter in this case advises the borrower that in order to avoid acceleration
and foreclosure, the borrower must:
PAY THE AMOUNT IN DEFAULT, AS STATED ABOVE, WITHIN 30 DAYS FROM THE DATE OF THE LETTER (THE CURE DATE) PLUS ANY REGULAR PAYMENT, LATE CHARGES OR FEES THAT MAY COME DUE DURING THE 30 DAY PERIOD.
R. 163 (bold and all caps in original). The letter goes on to state:
Because of interest, late charges, and other charges that may vary from day to day, the amount due on the day you pay may be greater. Hence, if you pay the amount shown above, an adjustment may be necessary after we receive your check, in which event we will inform you before depositing the check for collection. For further information, write Saxon at the address below or call…
R. 163. By failing to specify with sufficient detail the action the borrower must
make to cure the default, the notice fails to give the notice required by the
Mortgage. As the Florida Supreme Court has explained:
“Specify” means “[t]o mention specifically; to state in full and explicit terms; to point out; to tell or state precisely or in detail; to particularize, or to distinguish by words one thing from another.” Black's Law Dictionary 1399 (6th ed. 1991). “Specify” means a “statement explicit, detailed, and specific so that misunderstanding is impossible.”
30
Florida League of Cities v. Smith, 607 So. 2d 397, 399 (Fla. 1992). Here, the
notice does not “specify… the action required to cure the default,” because
simply paying the “Amount in Default” listed in the letter, by the very terms of the
letter, is not sufficient to cure the default. Misunderstanding is not just possible,
but probable, because the letter alludes to additional “late charges or fees that may
come due during the 30 day period,” but does not explain whether a payment
definitely will come due, or just “may” come due, and does not provide any way
from the face of the letter to determine what “interest, late charges, and other
charges that might vary from day to day” must be paid to cure the default.
The fact that the letter advised Patterson to seek further information by
calling or writing to its sender does not save the letter, either. As explained by the
Third District, when a party is required to give a notice explaining how to cure a
default, the receiving party is “not required to be placed in the position of
detective[]” and cannot be required to “piece together various correspondence to
get the information required.” Midtown Enterprises, Inc. v. Local Contractors,
Inc., 750 So. 2d 683, 685 (Fla. 3d DCA 1999). If the receiving party cannot just
look at the notice and know exactly how to cure the default, then the notice fails to
“specify… the action required to cure the default.” Id.
31
Moreover, because this issue is plainly presented on the record before the
trial court, this court can and should apply the tipsy coachman doctrine and uphold
the decision below even though the trial court did not mention this argument as a
basis for its holding. See, e.g., Pollock v. Danner, 98 So. 3d 650 (Fla. 2d DCA
2012) (affirming when the trial court reached the “right result, albeit for the wrong
reasons,” because a pre-suit notice was legally insufficient); Dade County Sch. Bd.
v. Radio Station WQBA, 731 So. 2d 638, 645 (Fla. 1999)(where there is “any
theory or principle of law which would support the trial court’s judgment in favor
of the plaintiffs, the district court was obliged to affirm that judgment”).
C. The Letter Did Not Specify the Default.
The letter also fails to “specify: (a) the default,” as required by Paragraph
22. R.163. This court has made clear that a Paragraph 22 notice cannot just
“generally allege” that the party committed a breach, but must “specify the default
as required by the mortgage terms.” Judy, 100 So. 3d at 1289.
Here, the letter does not “specify the default as required by the mortgage
terms,” but vaguely states that “Your loan is in default because you have not made
the required payments when they came due.” R. 163. But this statement fails to
identify when the supposedly missed payments were due, what they were for (such
as property taxes, insurance, monthly mortgage payments and, if monthly
32
mortgage payments, which months). Given the variety of payment obligations
found in the mortgage, this notice is not sufficient under the express terms of the
contract to specify the default.
As with the failure to specify the action required to cure the default, this
issue, too, is plain from the trial court record and provides a second and
independent basis to uphold the trial court’s summary judgment. See, Pollock and
Radio Station, supra.
D. The Out of State and Trial Court Cases Cited By the Bank Are Not Persuasive Here.
This Court should not rely on the out-of-state cases or trial court cited by the
Bank because there are sufficient Florida appellate court rulings on point. Out of
state cases only have persuasive value if there are no cases on point within the
state.
In the wake of Samaroo, trial court cases on either side of the issue are
irrelevant, because the trial courts in this district are bound by the decisions of the
other district courts of appeal. Breed Technologies, Inc. v. AlliedSignal Inc., 861
So. 2d 1227, 1231 (Fla. 2d DCA 2003).
Moreover, the Florida Courts of Appeal have, in over a dozen cases,
consistently required compliance with Paragraph 22 of the mortgage, without
33
qualifying the compliance as “substantial” or applying any other qualification. See
cases cited, supra. Thus, there is no need to resort to out of state precedent.
Moreover, Florida courts have rejected out-of-state case law requiring
substantial compliance in other contexts. See e.g. McDaniel, 722 So. 2d at 867
(finding Pennsylvania case law “neither controlling nor persuasive because, unlike
Florida, Pennsylvania law only requires insureds to substantially comply with the
terms of an insurance policy in order to effectuate a change of beneficiary”).
To the extent the Court does find trial court and out of state decisions
generally persuasive, many other courts have held that a letter that informs the
borrower of the “right to bring a court action” does not comply with Paragraph 22.
While the Bank cites a small handful of trial court decisions – at least one of which
was never actually entered – on the other side of the scales is a plethora of
decisions from circuit judges from at least 25 different trial judges throughout
Florida who have granted defense summary judgments based on paragraph 22
noncompliance. See Notice of Supplemental Authority. While these orders are
likewise not binding on this Court, the sheer volume of them is persuasive in that
they properly apply the paragraph 22 precedent of the courts of appeals, without
resort to out-of-state case law.
34
CONCLUSION
The Bank in this case utterly failed to properly oppose the summary
judgment before this Court, and convinced the trial court to consider the merits of a
notice letter it never presented as summary judgment evidence. It then appealed
when it wasn’t happy with the outcome of the analysis Deutsche Bank itself invited
the trial court to make. This Court should not take the bait. Deutsche Bank
waived its arguments regarding the procedural posture of this case. Because
Deutsche Bank did not proffer admissible evidence that it complied with Paragraph
22 of the mortgage, the analysis should end there, regardless of the reasoning
applied by the trial court. And in any event, the trial court applied the proper
analysis to the incorrectly-considered letter. The letter failed to specify how to
cure the default, as the trial court ruled, and also failed to specify several other
facts required by the plain language of the mortgage’s bolded paragraph 22.
In light hereof, and for all of the foregoing reasons, this Court should affirm
the Order on review without the need for written opinion.
35
July 16, 2014 Dineen Pashoukos Wasylik Florida Bar No. 0191620 DPW LEGAL PO Box 48323 Tampa, FL 33646 Tel: 813-778-5161 Fax: 813-971-0180 [email protected]; [email protected] Of Counsel for Appellee Barry Keith Patterson
Respectfully Submitted, /s/Mark P. Stopa . Florida Bar No. 550507 STOPA LAW FIRM 2202 N. West Shore Blvd., Ste 200 Tampa, FL 33607 Tel: (727) 851-9551 [email protected] Counsel for Appellee Barry Keith Patterson
CERTIFICATE OF COMPLIANCE WITH FONT STANDARD
Undersigned counsel hereby respectfully certifies that the foregoing Brief
complies with Fla. R. App. P. 9.210 and has been typed in Times New Roman, 14
Point.
/s/Mark P. Stopa . Mark P. Stopa Florida Bar No. 550507
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a true and correct copy of the foregoing was
served this August 5, 2014 to all parties on the attached service list. Service was
36
by email to all parties not exempt from Rule 2.516 Fla. R. Jud. Admin. at the
indicated email address on the service list, and by U.S. Mail to any other parties.
Respectfully Submitted, /s/Mark P. Stopa . Mark P. Stopa Florida Bar No. 550507
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SERVICE LIST
Richard C. Swank rswank@ bakerdonelson.com fedcts@ bakerdonelson.com Michael D. Starks mstarks@ bakersonelson.com Taraneh Maloney tmaloney@ bakerdonelson.com BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ, PC SunTrust Center 200 South Orange Ave., Suite 2900 Post Office Box 1549 Orlando, Florida 32802 Telephone: (407) 422-6600 Telecopier: ( 407) 841-0325 Attorneys for Appellant Deutsche Bank
Kim Greenburg, Esquire Kahane & Associates, P .A. 2655 S LeJeune Rd Ste 500 Coral Gables, Florida 331345832 notice@ kahaneandassociates.com
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