Ricardo Ortiz, Nuria Almeida and Frank Padron v. PNC Bank, National Association
188 So. 3d 923
| Fla. Dist. Ct. App. | 2016Background
- Appellants Ortiz, Almeida, and Padron obtained a mortgage and note that were indorsed and ultimately shown with a blank indorsement; PNC Bank filed a foreclosure complaint attaching a copy of the note that reflected those indorsements.
- PNC later filed the original note with the court matching the copy attached to the complaint; a witness could not confirm whether PNC possessed the original note at the time the complaint was filed.
- Before suit, PNC sent a default letter that informed borrowers they had a right to "bring a court action" if they believed the loan was not in default or had other defenses; Paragraph 22 of the mortgage required notice of the right to "assert in the foreclosure proceeding" the non-existence of default or other defenses.
- Appellants moved for involuntary dismissal at trial; the court denied the motion, and entered final judgment for PNC. Appellants appealed.
- The Fourth DCA addressed two principal issues: (1) whether PNC had standing to foreclose at the time it filed suit, and (2) whether PNC’s default letter substantially complied with Paragraph 22 of the mortgage.
Issues
| Issue | Plaintiff's Argument (PNC) | Defendant's Argument (Appellants) | Held |
|---|---|---|---|
| Standing to foreclose | Copy of note with blank indorsement attached to complaint plus later filing of original matching note establishes possession at filing and thus standing | Appellants challenged PNC’s possession at the time complaint filed; witness could not confirm possession | Court: Attachment of copy plus later filing of original in same condition is sufficient to establish standing absent contrary evidence; affirmed trial court |
| Compliance with Paragraph 22 notice requirement | Default letter’s language (right to "bring a court action") substantially complies with mortgage notice requirement | Letter did not strictly follow Paragraph 22 wording (which requires right to "assert in the foreclosure proceeding") and thus was deficient | Court: Apply substantial-compliance standard; letter substantially complied and there was no demonstrated prejudice; affirmed trial court |
Key Cases Cited
- Westport Recovery Corp. v. Midas, 954 So. 2d 750 (Fla. 4th DCA 2007) (standing is a question of law reviewed de novo)
- McLean v. JP Morgan Chase Bank Nat’l Ass’n, 79 So. 3d 170 (Fla. 4th DCA 2012) (plaintiff must have standing when complaint is filed)
- Rodriguez v. Wells Fargo Bank, N.A., 178 So. 3d 62 (Fla. 4th DCA 2015) (possession is core element for bearer notes)
- Clay County Land Trust v. JPMorgan Chase Bank, Nat’l Ass’n, 152 So. 3d 83 (Fla. 1st DCA 2014) (copy of note with blank endorsement attached to complaint can establish standing)
- Reilly v. Reilly, 94 So. 3d 693 (Fla. 4th DCA 2012) (contract interpretation is reviewed de novo)
- Green Tree Servicing, LLC v. Milam, 177 So. 3d 7 (Fla. 2d DCA 2015) (mortgage notice requirement subject to substantial compliance standard)
- Casa Linda Tile & Marble Installers, Inc. v. Highlands Place 1981, Ltd., 642 So. 2d 766 (Fla. 4th DCA 1994) (definition of substantial performance)
- Ocean Ridge Dev. Corp. v. Quality Plastering, Inc., 247 So. 2d 72 (Fla. 4th DCA 1971) (substantial performance principle)
- Bank of N.Y. Mellon v. Nunez, 180 So. 3d 160 (Fla. 3d DCA 2015) (discussing substantial-compliance approach among districts)
- Gorel v. Bank of N.Y. Mellon, 165 So. 3d 44 (Fla. 5th DCA 2015) (absence of prejudice can affect enforceability of contract conditions)