On March 16, 2017, the FL Supreme Court denied all pending motions for rehearing made by the borrowers and other groups who filed briefs on behalf of homeowners in the landmark Bartram case, thus making the opinion issued in November 2016 official and final (as all pending motions for rehearing were denied).
This finalizes the state of the law in Florida with regard to the statute of limitations as foreclosure. The Florida Supreme Court’s opinion in Bartram now officially holds that the involuntary dismissal of a prior foreclosure action, with or without prejudice, does not prevent the filing of a new foreclosure action based on new, and continuing, monthly defaults in payment.
This will surely start a whole new wave of foreclosure filings as many banks were awaiting Bartram to become final before proceeding with many old foreclosures that were dismissed for one reason or another and the borrower(s) still in default since.
In a rather perplexing decision, Bank of New York Mellon Trust Co. v. Fitzgerald, Case No. 3D16-981, at *2 (3d DCA Mar. 1, 2017), the 3rd DCA recently rules that when a lender sues and loses the case because it cannot prove its standing to foreclose, the borrower cannot claim his/her attorney’s fees paid to defend as the prevailing party per 57.105(7). Typically in a foreclosure case, when the borrower “wins” the case (or lender does not prove its case), the borrower can claim his/her attorney’s fees paid to defend the case under the mortgage (contract) and 57.105 (7) providing that if there is a prevailing party clause, it is reciprocal and each party can claim it against the other.
In this case, at trial the court determined that plaintiff failed to establish its standing as owner/holder of the note to foreclose based on the fact that there was no assignment or mortgage or other document showing transfer of the note to plaintiff from the original lender.
The borrower moved for attorney’s fees and was granted as it is routinely done.
The lender appealed arguing that it cannot possibly be liable for borrower’s attorney’s fees as the trial court held that it was not even a party to the note and mortgage; and thus if not a party was not bound by the terms of the note/mortgage to pay anyone attorney’s fees. The court followed a recent opinion with a similar holding out of the 5th DCA in HFC Collection Ctr., Inc. v. Alexander, 190 So. 3d 1114 (Fla. 5th DCA 2016); but was merely not in the mortgage foreclosure context.
The 3rd DCA held that since there was no contract between borrower and plaintiff per the trial court’s judgment in favor of defendant, borrower could not use the contractual terms to collect attorneys fees from plaintiff.
In essence, this line of cases now allows any lender to sue a borrower whether it can prove its case or not without fear of paying borrower’s attorney’s fees. The lenders can sue anyone they want without repercussion or fear of having to pay out, and likely will be more cavalier with their case filings knowing such.