Kaan v. Wells Fargo Bank, N.A.
2013 U.S. Dist. LEXIS 160288
| S.D. Fla. | 2013Background
- Plaintiff Ronald Kaan executed a note and mortgage related to 2115 South Ocean Boulevard, Delray Beach, FL, with MERS as nominee for Aegis Wholesale Corp.
- Mortgage was assigned to Wells Fargo Bank, N.A. as Trustee on January 9, 2008; Flagstar holds a home equity line of credit on the property.
- Plaintiff defaulted by failing to pay July 1, 2007; Wells Fargo filed a foreclosure on February 15, 2008 and later dismissed it without prejudice in September 2011.
- Plaintiff commenced a quiet-title action arguing that the previous foreclosure dismissal bars any recovery due to Florida's five-year statute of limitations.
- Court analyzes whether the note/mortgage constitute a cloud on title, whether successive defaults can support new foreclosures, and whether MERS or Flagstar have actionable interests.
- Court grants motions to dismiss, holding the lien remains enforceable and no cloud exists; dismissal is with prejudice but does not bar future quiet-title actions based on different facts.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether quiet title requires a cloud on title and valid lien remains | Kaan contends cloud exists due to dismissed foreclosure action | Wells Fargo/others argue lien remains enforceable; cloud not established | No cloud; lien remains enforceable |
| Effect of prior foreclosure dismissal on later foreclosures based on different defaults | Dismissal with prejudice bars subsequent actions | Subsequent defaults can support new actions; res judicata not applicable | Subsequent distinct defaults can support new foreclosure; not barred |
| Whether five-year statute of limitations bars relief under Florida law | All recoveries barred since earlier defaults beyond five years | Older payments may be outside SOL; newer defaults create action window | Note and mortgage remain enforceable; ongoing rights preserved |
| Whether MERS has any interest in Kaan's property justifying a quiet-title claim | MERS has some interest via mortgage/assignment | MERS' interest is nominal; no claim stated | Plaintiff fails to state a quiet-title claim against MERS |
| Whether Flagstar has any cognizable interest to support a quiet-title claim | Alleges claims against Flagstar | Fails to plead any facts showing Flagstar's interest | Plaintiff fails to state a quiet-title claim against Flagstar |
Key Cases Cited
- Singleton v. Greymar Assoc., 882 So.2d 1004 (Fla. 2004) (new/defaults create separate foreclosures; not barred by earlier action)
- Star Funding Solutions, LLC v. Krondes, 101 So.3d 403 (Fla.Dist.Ct.App. 2012) (new default creates new action; dismissal with prejudice not fatal)
- Stark v. Frayer, 67 So.2d 237 (Fla.1953) (cloud on title requires pleading of valid and invalid facts)
- McDaniel v. McElvy, 108 So. 820 (Fla.1926) (elements of quiet-title action; need actual cloud facts)
- Crenshaw v. Lister, 556 F.3d 1283 (11th Cir.2009) (exhibits may govern when conflict with pleadings; attached docs central)
- Starship Enterprises of Atlanta, Inc. v. Coweta County, Ga., 708 F.3d 1243 (11th Cir.2013) (motion-to-dismiss evidence may be considered without converting to summary judgment)