Thursday, April 28, 2011

Fourth District Reverses Order Finding Personal Jurisdiction Because No Contacts With Florida

In Corporacion Aero Angeles v. Fernandez (4D09-4997), the Fourth District reversed a trial court's order and concluded that personal jurisdiction cannot be constitutionally exercised over the appellee. "This case arises out of the breach of an oral brokerage agreement for the sale of a jet owned by Aero Angeles, a Mexican Corporation. The plaintiff, Jaime Gaston Fernandez, claims that he was not paid a commission in connection with the sale and filed suit seeking damages from Aero Angeles.  The corporation contends that it did not enter into a contract to pay him a commission."

As with any personal jurisdiction issue, the contacts with the state of Florida were analyzed-or lack of contacts. The court stated:
The jet was headquartered in Mexico and was never offered for charter flights to Florida or for Florida residents. Palero testified that the company had no type of business in Florida. The company did not have employees, offices, phone listings, bank accounts, leases or sales in Florida. It did not engage in business in Florida and did not register to do business in the state. It did not have an agent in Florida for service of process and never paid Florida taxes. The company did not bring paying passengers to Florida.
With regard to the law and the requirements necessary to satisfy personal jurisdiction, the Court stated:
Stated another way, to satisfy the minimum contacts requirement for purposes of personal jurisdiction a defendant’s contacts (1) must be related to the plaintiff’s cause of action or have given rise to it, (2) must involve some act by which the defendant has purposefully availed itself of the privilege of conducting activities within the forum, and (3) the defendant’s contacts with the forum must be such that the defendant should reasonably anticipate being haled into court there.
In this case, the Fourth District determined that "none of the three criteria for minimum contacts has been satisfied." Therefore:
We conclude that the appellant has not shown that jurisdiction can be constitutionally asserted over Aero Angeles. Specific jurisdiction based upon minimum contacts between Aero Angeles and Florida has not been established. Reversed with directions to dismiss the cause of action for lack of jurisdiction.
On June 29, 2011, the Fourth District released an opinion denying rehearing but adding a paragraph to its original opinion. That additional information can be viewed HERE

Thursday, April 21, 2011

Entry Of Default Is Not Discretionary

In TBOM Mortgage Holdings LLC v. Brown (3D11-229), the Third District agreed with the petitioner that the trial court erred by refusing to enter a default. The trial court had refused to enter the default based upon "what must be called the spurious reason that the non-military affidavit was in some unspecified (because non-existent) way 'insufficient'.”
In fact and in law, the affidavit, which was in the universally accepted form, and was supported by evidence which clearly established that the defendant, who was personally served at his home in Miami-Dade County, was not in the military service, was legally impeccable. Since it is established and we repeat that the trial court is not free to refuse to follow the law because of some personal disinclination or otherwise....and that it is, therefore,mandatorily required to enter the default sought in this is ordered that it expeditiously do so.
Judge Salter dissented for two reasons. First, he believed this should have been treated as a petition for certiorari and not mandamus. Had it been treated as a petition for certiorari the petition would have been untimely. Second, Judge Salter stated that Florida Rule of Civil Procedure 1.500(b) uses "may" regarding the entry of default and not "must." The use of the word "may," according to Judge Salter, renders it a discretionary task and inappropriate for mandamus.

Friday, April 15, 2011

Motion To Vacate Default Must Be Heard Before Entry Of Final Default Judgment

In Goodman v. Joffe (4D10-4663), the Fourth District reversed the trial court's final default judgment.  The "trial court should have ruled on her pending motion to vacate the default entered against her before entering a default final judgment."  The court affirmed the trial court's ruling denying a motion to quash service of process.

Sunday, April 10, 2011

Possession Of Note Payable To Bearer Entitled Lender To Seek Foreclosure

In Isaac v. Deutsche Bank National Trust Company (4D09-3036), the appellant argued "that Deutsche Bank failed to provide sufficient documentation reflecting how it obtained ownership of the mortgage and note from the original assignee, an entity called Option One."  In response to the appellants argument, the court stated:
To  prove  its  ownership,  Deutsche  Bank  filed  with  the  court  the original mortgage, note, and an allonge  from Option One, payable to bearer, together with the aforementioned affidavit.   The allonge, signed by an assistant secretary of Option One, did not state a payee.  In this case, because the allonge did not state a payee, the note is “payable to bearer.”...
The court stated:
Deutsche Bank, by virtue of its possession of an instrument payable to bearer, is a valid holder of the note and, therefore, is entitled to enforce it.  The affidavit from Option One’s successor in interest, also uncontested, provides proof of Deutsche Bank’s right to foreclose the mortgage....
Because no genuine issue of material fact remained, the trial court properly entered summary judgment for the bank.

Saturday, April 9, 2011

Order Setting Aside Foreclosure Sale Reversed To Allow For Evidentiary Hearing

In Arsali v. Deutsche Bank National Trust Company, et al (4D10-3830), the Fourth District reversed a trial court's order cancelling a foreclosure sale "because the trial court erred in summarily granting the bank’s motion to rescind the foreclosure sale without notice to appellant and without an evidentiary hearing on the bank’s allegations that the bid was grossly inadequate and resulted from mistake, fraud, or other irregularity in the sale."

After a judgment was entered, the trial court scheduled a foreclosure sale.  Approximately fifteen days prior to the foreclosure sale, counsel for the lender/appellee "filed a Motion to Cancel the Foreclosure Sale to  determine whether the homeowner qualified for a loan modification.  The trial court, however, failed to enter an order cancelling the foreclosure sale, and the sale went forward as scheduled..."  After the foreclosure sale:
The bank promptly filed an Emergency Motion to Rescind and Reschedule the Foreclosure Sale, asserting that '[d]ue to its mistake or inadvertence, and because [the bank] believed the sale would be cancelled, [the  bank] failed to send a representative to the foreclosure sale.'   The bank further alleged that the property was appraised at $185,940.00, and that a third-party purchaser’s bid of $16,100.00 was “grossly undervalued at 11.55% of the property’s appraised value.” Along with the bank’s emergency motion, the homeowner filed an objection to the foreclosure sale; the homeowner mistakenly believed that the foreclosure sale had been cancelled and argued that granting the objection would not prejudice anyone since title to the subject property had not been transferred.
The trial court granted the emergency motion to cancel sale at a motion calendar hearing, however, the appellant was not given notice of the hearing.

The Fourth District first addressed an argument made by the appellee that the appellant did not have standing to bring the appeal.  The court stated:

The bank contends that because appellant did not obtain a court order permitting him to intervene in this foreclosure suit prior to filing this appeal, he now lacks standing to be a party in this action.  Appellant responds that such procedure is unnecessary, as Florida’s well-settled law recognizes that a third-party purchaser who is not a named party in the action becomes a quasi-party with standing to appeal an adverse ruling.  Appellant argues that as a third-party purchaser, he is a quasi-party who does not need to intervene under Rule 1.230 in order to have standing to appeal.   We agree.
After addressing the standing issue, the court discussed the merits of the appeal.
As to the merits, “[w]hether the complaining party has made the showing necessary to set aside a [foreclosure] sale is a discretionary decision by the trial court, which may be reversed only when the court has grossly abused its discretion.”....“It is well established that courts may exercise their discretion as courts of equity to set aside foreclosure sales and allow mortgagors to exercise their statutory right of redemption where there has been some defect in the proceedings regarding notice of the foreclosure sale date, or other egregious  matters,  such as  a  grossly  low  bid by the purchaser and accident or mistake on the part of the mortgagor or an attorney representing the mortgagor, in failing to attend the foreclosure sale.”
For a trial court to properly rescind a foreclosure sale, the record must demonstrate that the sale was improper based upon a two-part test. The mortgagor has the burden of proving not only that “the foreclosure sale bid was grossly or startlingly inadequate,” but also that the bid’s inadequacy resulted from “some mistake, fraud or other irregularity in the sale.”....In determining whether a foreclosure sale should be vacated, a trial court may conduct an evidentiary hearing on the bank’s motion to rescind the sale....A trial court conducts an evidentiary hearing because attorneys’ arguments are not evidence....Moreover, unsworn statements by an attorney at a hearing do not establish facts upon which the trial court can rely.
Finally, the court concluded:
Here, it appears the trial court summarily granted the bank’s motion to rescind the foreclosure sale without holding an evidentiary hearing to determine a factual basis for the bank’s claims. As noted earlier, the bank’s motion did not attach sworn affidavits, and the bank did not present testimony at the calendar call. The record does not reflect that the bank presented witnesses who vouched for the bank’s mistake or testified to the gross inadequacy of the price. We thus conclude that the trial court abused its discretion in summarily granting the motion without holding an evidentiary hearing to determine whether the sale should have been set aside.

After Foreclosure Judgment A Court Has Jurisdiction To Consider Counterclaim Relating To Deficiency Judgment

In Bank of America, N.A. v. Diamond (4D10-2178), the Fourth District denied a petition for writ of prohibition.  The petitioner argued that the trial court lost jurisdiction to consider an answer and counterclaim after the entry of a final judgment of foreclosure.  The entire opinion is copied below:
The petition for writ of prohibition is denied.  The court has jurisdiction to consider the answers and counterclaim filed after the final judgment of foreclosure, as they relate to the motion for deficiency judgment. The answers and counterclaim also contest liability on the guarantees executed by the individual defendants.  The issue of liability on the guarantees was raised in count II of the amended complaint, but those issues were not disposed of in the final judgment of foreclosure. To the extent that the answers and counterclaim are directed solely to the final judgment of foreclosure, the court lacks jurisdiction to disturb that judgment. See Francisco v. Victoria Marine Shipping, Inc., 486 So. 2d 1386 (Fla. 3d DCA 1986) (after time for rehearing ends, trial court loses jurisdiction except to enforce the judgment and as provided in Florida Rule of Civil Procedure 1.540(b)).