Taoufiq Seffar v. Residential Credit Solutions, Inc.
160 So. 3d 122
| Fla. Dist. Ct. App. | 2015Background
- Appellant (Seffar) executed a 2006 note and mortgage to ABN Amro Mortgage Group (ABN).
- Servicing transfers: CitiMortgage transferred servicing to Residential Credit Solutions (RCS) in 2009; RCS later transferred servicing to Bayview Loan Servicing shortly before trial.
- RCS filed foreclosure suit alleging it had the right to enforce the note; the original complaint attached the ABN note (stamped “original” with no endorsements/allonges) and an assignment of mortgage from FDIC (receiver for Franklin Bank) to MERS as nominee for RCS.
- Nine months after filing, RCS filed what it claimed was the original note with an undated blank allonge payable to bearer; no proof the allonge was affixed to the note or when it was executed.
- Bayview, as substituted plaintiff, presented testimony from a Bayview litigation manager who lacked firsthand knowledge of prior servicers’ records, had not seen purchase/assignment documents, and could not verify chain-of-title or the allonge’s authenticity.
- Trial court entered a final judgment of foreclosure; the Fourth District reversed, finding plaintiff failed to prove standing at the time suit was filed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did plaintiff prove standing to foreclose at filing? | RCS/Bayview argued they had the right to enforce the note as holder or nonholder in possession (allonge and assignment evidence). | Seffar argued plaintiff failed to prove ownership/possession or valid endorsements at filing. | Reversed — plaintiff failed to prove standing at the time of filing. |
| Was the undated blank allonge sufficient to show plaintiff was a holder? | Allonge payable to bearer shows transfer to plaintiff. | Allonge was undated, not shown attached to the note, and no proof of execution/date. | Allonge insufficient; no evidence it was affixed or effective before filing. |
| Could plaintiff rely on servicer-transfer letters and testimony to establish ownership/rights? | Plaintiff pointed to servicer-transfer letters and litigation manager testimony asserting purchase/possession. | Defendant noted letters do not convey enforcement rights and testimony lacked documents or personal knowledge of transfers. | Insufficient; servicer letters and manager testimony without documentary proof failed to show transfer of enforcement rights. |
| Could a nonholder in possession enforce the note without proving each prior transfer? | Plaintiff contended nonholder-possession status sufficed under applicable statutes/case law. | Defendant argued plaintiff must prove chain of transfers so transferee’s rights derive from transferor. | Court held plaintiff must prove each prior transfer (derivative rights); plaintiff failed to do so. |
Key Cases Cited
- McLean v. JP Morgan Chase Bank Nat’l Ass’n, 79 So. 3d 170 (Fla. 4th DCA 2012) (standing to foreclose must be established at filing; holder or valid assignment required)
- Mazine v. M & I Bank, 67 So. 3d 1129 (Fla. 1st DCA 2011) (person entitled to enforce includes holder or nonholder in possession with holder's rights)
- Booker v. Sarasota, Inc., 707 So. 2d 886 (Fla. 1st DCA 1998) (allonge must be firmly affixed to the note to be effective)
- Isaac v. Deutsche Bank Nat’l Trust Co., 74 So. 3d 495 (Fla. 4th DCA 2011) (discussing allonges and endorsement issues)
- Anderson v. Burson, 35 A.3d 452 (Md. 2011) (transferee must prove each prior transfer; transferee’s enforcement rights are derivative)