Case Information
*1 D ISTRICT C OURT O F A PPEAL O F T HE S TATE O F F LORIDA F OURTH D ISTRICT
JONATHAN ROUFFE and RACHEL PEARL
a/k/a RACHEL ROUFFE, Appellants,
v. CITIMORTGAGE, INC., Appellee.
No. 4D16-3583
[March 21, 2018] Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm Beach County; Jeffrey D. Gillen, Judge; L.T. Case No. 50-2011-CA- 018454-XXXX-MB.
W. Trent Steele of Steele Law, Hobe Sound, for appellants.
David Rosenberg and Jarrett Cooper of Robertson, Anschutz & Schneid, P.L., Boca Raton, for appellee.
B ELANGER , R OBERT , Associate Judge.
Appellants, Jonathan Rouffe and Rachel Pearl, a/k/a Rachel Rouffe, (“the Heirs”), appeal the final judgment of foreclosure entered in favor of appellee, CitiMortgage, Inc. (“Citi”). On appeal, the Heirs contend that the trial court erred in denying their motion for involuntary dismissal at trial, arguing that Citi failed to prove the borrower defaulted, Citi failed to provide evidence of a forbearance agreement, and failed to establish the correct date of default. For the reasons discussed below, we affirm in part and reverse in part with remand.
In 2003, the borrower borrowed money to purchase her home. Citi acquired the note and mortgage which secured the borrower’s loan.
In March 2010, the borrower failed to make payments required under the loan. In March 2011, the borrower died, and in November 2011, Citi filed a foreclosure action to enforce the note and mortgage. The Heirs were heirs of the borrower, and were indispensable parties properly named in Citi’s complaint.
At trial, Citi’s main witness testified regarding the date of default, but provided several dates, explaining that the borrower made partial payments for some time, so there was a date of “last full payment,” versus partial payments received.
This witness also mentioned forbearance agreements between the borrower and Citi, and over Citi’s objection, the Heirs’ counsel questioned the witness regarding these agreements. Neither party, however, offered the agreements into evidence.
After Citi rested, the Heirs moved for involuntary dismissal, arguing that Citi failed to provide the forbearance agreements, and therefore, failed to prove how and when the borrower defaulted. The trial court disagreed, denied the Heirs’ motion, and eventually entered a final judgment of foreclosure. The Heirs gave notice of appeal.
The applicable standard of review for a motion for involuntary dismissal
is
de novo
.
Deutsche Bank Nat’l Tr. Co. v. Clarke,
When an appellate court reviews the grant of a motion for involuntary dismissal, it must view the evidence and all inferences of fact in a light most favorable to the nonmoving party, and can affirm a directed verdict only where no proper view of the evidence could sustain a verdict in favor of the nonmoving party.
Id.
;
see also Deutsche Bank Nat’l Tr. Co. v. Huber
,
We affirm the trial court’s ruling for two reasons: (1) the Heirs did not have standing to challenge the borrower’s liabilities under the note and mortgage; and (2) even if the Heirs did have standing, it was their burden to plead the affirmative defense regarding the forbearance agreement.
In
Clay County Land Trust No. 08-04-25-0078-014-27, Orange Park
Trust Services, LLC v. JPMorgan Chase Bank, National Ass’n
, 152 So. 3d
83 (Fla. 1st DCA 2014), the appellant, the current owner of the property
at issue, asserted that the appellee-bank failed to give the borrower written
notice of default and an opportunity to cure as required by the mortgage.
*3
Id.
at 84. The First District held that “[b]ecause appellant was not a party
to the mortgage, appellee correctly asserts that appellant does not have
standing to challenge any violation of these mortgage terms.”
Id.
The
borrower “was the only party who could plead nonperformance of these
conditions precedent.”
Id.
;
see also Pealer v. Wilmington Tr. Nat’l Ass’n for
MFRA Tr.
,
We hold that since the Heirs were not parties to the note and mortgage
in this case, they lack standing to challenge the borrower’s rights and
liabilities under the contract as opposed to challenging only the amount of
damages.
Clay Cty.,
However, even if the Heirs had standing, we would still affirm. On appeal, the Heirs argue that Citi failed to prove the borrower’s default. Specifically, the Heirs argue that Citi was required, but failed, to allege and prove a default of the forbearance agreement, as opposed to proving a default of the original note and mortgage. They cite to two cases in support of this argument: Nowlin v. Nationstar Mortgage, LLC, 193 So. 3d 1043 (Fla. 2d DCA 2016), and Kuehlman v. Bank of America, N.A., 177 So. 3d 1282 (Fla. 5th DCA 2015). However, Nowlin and Kuehlman are distinguishable insofar as both cases involved the parties who actually signed the note and mortgage, and therefore had standing to contest liability under the contract as modified. Nowlin , 193 So. 3d at 1044; Kuehlman , 177 So. 3d at 1283. Here, as Citi correctly argues, and discussed above, the Heirs were never parties to the note and mortgage, and as such, lacked standing to litigate the borrower’s liability thereunder.
We also agree with Citi’s argument that even if the Heirs had standing,
it was their burden to plead the existence of a modification or forbearance
agreement as an affirmative defense.
Accord Bank of N.Y. Mellon v. Bloedel,
43 Fla. Law Weekly D258,
We agree with Citi and align our court with the well-reasoned opinion of Bloedel .
Bloedel reiterates well-settled law, that:
The effect of a modification to a legal agreement, to the extent it would constitute an avoidance of all or part of a defendant’s liability under the agreement, is an affirmative defense that must be pled and proven by the defendant. See Fla. R. Civ. P. 1.110(d) “[A] party shall set forth affirmatively . . . any other matter constituting an avoidance or affirmative defense.”; BSP/Port Orange, LLC v. Water Mill Props., Inc ., 969 So. 2d 1077, 1078 (Fla. 5th DCA 2007) (holding that an alleged modification to an oral commission agreement was an affirmative defense that had to be pled).
Notably, although we hold that the Heirs lack standing to challenge
liability in this case, they do have standing to challenge the amount due
under the note, because it affects their substantive right of redemption
under section 45.0315, Florida Statutes (2016). In this case, there was
testimony and evidence in the form of a payment history, sufficient to
present a prima facie case on damages.
Wachovia Mortg., F.S.B. v.
Goodwill
,
However, we agree with the Heirs that the conflicting evidence regarding the exact date of default affects the specific amount due in order to exercise their right of redemption.
As this court held in
Beauchamp v. Bank of New York
,
Beauchamp has a right of redemption wherein he may prevent divestiture of his legal title upon payment of the amount of the debt specified in the judgment. CCC Props., Inc. v. Kane , 582 So. 2d 159, 161 (Fla. 4th DCA 1991); § 45.0315, Fla. Stat. (2013). Therefore, even though Beauchamp is not personally liable for the debt, the amount of the debt owed is important as it relates to Beauchamp’s right of redemption, specifically as to the amount due under the judgment in order to exercise his right to stop the foreclosure sale.
Thus, the Bank’s failure to provide admissible evidence that would establish the proper amount due on the note was not harmless error. Rather, proof of the amount of debt owed was required to allow the foreclosure, and Beauchamp’s ownership rights and right of redemption are substantive rights that were adversely affected by the error.
Id . at 828-29 (footnote omitted).
As in Beauchamp , we affirm the judgment of foreclosure, except as to the amount due under the note, and remand the case for further proceedings to determine that amount.
Affirmed in part; reversed in part; remanded for further proceedings consistent with this opinion.
C IKLIN and K LINGENSMITH , JJ., concur.
* * *
Not final until disposition of timely filed motion for rehearing.