Wednesday, May 4, 2011

Order Canceling Foreclosure Sale Reversed

In Jade Winds Association, Inc. v. Citibank, N.A. (3D11-275), the Third District reversed an order entered by the trial court canceling a foreclosure sale. After a foreclosure complaint was filed, a condominium association filed a cross-claim against the debtor for unpaid assessments. A default judgment was entered on the cross-claim and Jade Winds took title to the property.

Jade Winds the filed a "Waiver of Public Sale" and Jade Winds also sought summary judgment in favor of Citibank. A summary judgment was entered and a foreclosure sale was scheduled. On the morning of the foreclosure sale, the bank filed an emergency motion to cancel the foreclosure sale allegedly based upon instruction from the client (bank) to cancel the sale to determine if the borrower qualified for a loan modification.

The Third District said the basis for canceling the sale, to explore loan modification, "obviously was misleading" since the borrower no longer owned the property. Further, Jade Winds was not served with the motion to cancel the sale. Therefore, the motion to cancel was heard on an ex parte basis and was granted.

After the order was entered, Jade Winds sought sanctions against the bank. The motion was granted and monetary sanctions were imposed against the bank. The court also ordered the sale be rescheduled for January 4, 2011 and that the sale could not be cancelled. Notwithstanding the bar on canceling the sale, the bank filed a motion to cancel the January 2011 sale. Jade Winds was not served with the motion to cancel or the notice of hearing. The motion to cancel the January 2011 sale was considered, ex parte, and granted due to "affidavit review." The Third District stated:
In the instant case, without rehashing the facts set forth in this opinion, it is clear that Citibank failed to properly serve Jade Winds’ counsel with the Second Motion to Cancel and failed to notify counsel of the hearing. We recognize that the Second Motion to Cancel was filed on an “emergency” basis, but note that Citibank apparently made no attempt to notify Jade Winds’ counsel of the motion by either delivery, facsimile, email, or phone call, although Jade Winds’ counsel actively participated in this litigation. Further, based on Judge Langer’s previous order imposing sanctions against Citibank, Citibank knew that its actions were inappropriate. As Judge Langer simply found, Citibank’s “conduct was in direct violation of [Jade Winds’] due process rights” and the Order Canceling Sale was “void for lack of notice.”
The Court then referred Citibank's counsel to the applicable Miami-Dade administrative order (10-E), In re Amendments to the Florida Rules of Civil Procedure, 44 So. 3d 555, 557-58 (Fla. 2010), and reversed the order canceling the foreclosure sale with instructions to consider whether sanctions should be imposed.


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