241 So. 3d 870
Fla. Dist. Ct. App.2018Background
- Borrower took out a mortgage in 2003; CitiMortgage later acquired the note and mortgage.
- Borrower stopped making required payments in March 2010 and died in March 2011.
- Citi filed foreclosure in November 2011; the named defendants included the borrower’s heirs (Appellants).
- At trial Citi’s witness gave inconsistent default timing (last full payment vs. partial payments) and mentioned forbearance agreements; no forbearance agreements were introduced into evidence.
- After Citi rested, the Heirs moved for involuntary dismissal arguing Citi failed to prove default or the correct default date and failed to produce any forbearance agreement.
- Trial court denied the motion and entered a final foreclosure judgment; the Heirs appealed.
Issues
| Issue | Plaintiff's Argument (Heirs) | Defendant's Argument (Citi) | Held |
|---|---|---|---|
| Standing to challenge borrower’s contractual liabilities | Heirs argued Citi failed to prove default and thus they can challenge liability under the note/forbearance | Citi argued Heirs are not parties to the note/mortgage and lack standing to challenge borrower’s contractual liabilities | Heirs lack standing to challenge the borrower’s liabilities under the note and mortgage; they may only challenge amount due affecting redemption |
| Burden to plead forbearance/modification as defense | Forbearance agreement altered default obligations and Citi must prove default under the modified agreement | Citi argued any modification/forbearance is an affirmative defense which the Heirs had to plead and prove | Even if Heirs had standing, they failed to plead or prove a forbearance/modification; affirmative defense rests with the party asserting it |
| Sufficiency of evidence on amount due (damages) | Amount due unclear because of conflicting default dates and missing forbearance documents | Citi presented payment history and witness testimony to establish amount due | Payment history and testimony were sufficient to make a prima facie showing on damages, but conflicting default dates mean the precise amount due is unresolved |
| Remedy and next steps | Heirs sought dismissal or reversal based on evidentiary gaps | Citi sought affirmation of foreclosure judgment | Court affirmed foreclosure judgment generally but reversed and remanded solely to determine the correct amount due (impacting the heirs’ right of redemption) |
Key Cases Cited
- Deutsche Bank Nat’l Tr. Co. v. Clarke, 87 So. 3d 58 (Fla. 4th DCA 2012) (standard for reviewing involuntary dismissal/directed verdict)
- Deutsche Bank Nat’l Tr. Co. v. Huber, 137 So. 3d 562 (Fla. 4th DCA 2014) (same standard discussion)
- Clay Cty. Land Tr. No. 08-04-25-0078-014-27, Orange Park Tr. Servs., LLC v. JPMorgan Chase Bank, N.A., 152 So. 3d 83 (Fla. 1st DCA 2014) (nonparty lacks standing to challenge mortgage notice and cure obligations)
- Pealer v. Wilmington Tr. Nat’l Ass’n for MFRA Tr., 212 So. 3d 1137 (Fla. 2d DCA 2017) (nonparties’ interests subordinate to bank’s note/mortgage interest)
- Nowlin v. Nationstar Mortgage, LLC, 193 So. 3d 1043 (Fla. 2d DCA 2016) (modification/forbearance issues where signatories had standing)
- Kuehlman v. Bank of America, N.A., 177 So. 3d 1282 (Fla. 5th DCA 2015) (same as Nowlin re: standing to contest modifications)
- BSP/Port Orange, LLC v. Water Mill Props., Inc., 969 So. 2d 1077 (Fla. 5th DCA 2007) (modification that avoids liability is an affirmative defense)
- Beauchamp v. Bank of New York, 150 So. 3d 827 (Fla. 4th DCA 2014) (amount due is critical to owner’s statutory right of redemption)
- Wachovia Mortg., F.S.B. v. Goodwill, 199 So. 3d 346 (Fla. 4th DCA 2016) (payment history and witness testimony can establish a prima facie case on damages)
- Ottawa Props. 2 LLC v. Cent. Mortg. Co., 202 So. 3d 102 (Fla. 4th DCA 2016) (insufficient evidence of total indebtedness may require remand)
- CCC Props., Inc. v. Kane, 582 So. 2d 159 (Fla. 4th DCA 1991) (right of redemption discussion)