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Lender's standing continues to be hotly litigated in Florida

By Kerry McInerney • Wednesday, August 15, 2012

District Court of Appeal, Third District, 89 So3d 1069 (June 6, 2012)

The borrower appealed a decision from the Circuit Court, Miami‐Dade County wherein the trial court granted summary judgment in favor of the lender. On appeal, the borrower challenged the lender's standing to bring the foreclosure action arguing that the securitization trust failed to comply with its pooling and servicing agreement when it took possession of the original note and mortgage, nullifying its authority to foreclose. In citing Pennsylvania, Massachusetts and Florida case law, the District Court of Appeals, Third District, held that since the borrower was neither a party to, nor a third party beneficiary of, the securitization trust, the borrower lacked standing to raise this issue.  The final judgment of foreclosure in favor of the securitization trust was affirmed.

District Court of Appeal, Fifth District, 2012 WL 2359656 (June 22, 2012)

In this case, the Appellate court reversed the Citrus County Circuit Court's foreclosure judgment.   In the lender's complaint, it alleged that it owned and held the note and mortgage.  In support of its motion for summary judgment, the lender filed the original note, an assignment of mortgage, and supporting affidavits. An allonge to the note was of record which specifically endorsed the note to a securitization trust.  Because the allonge was inconsistent with the mortgage assignment and the lender's pleadings, the court ruled that a genuine issue of material fact existed justifying reversal of the foreclosure judgment.

District Court of Appeal, Fourth District, 2012 WL 1108428 (April 4, 2012)

In this decision, the Appellate Court reverses a foreclosure judgment from the Circuit Court, Broward County. A bank sued to foreclose on the borrower's mortgage.  After the suit was filed, the bank submitted the promissory note and an assignment of the mortgage.  The promissory note was specifically endorsed to the bank; but the endorsement was not dated.  The assignment transferred the interest of the mortgage to the bank; however, the assignment had an effective date after the date the suit was filed.  The bank also filed an affidavit stating that it was the holder and owner of the mortgage. The trial court granted the bank's motion for summary judgment and the borrower appealed.  The appellate court reversed the trial court's decision finding that the bank had failed to establish standing to foreclose.  The Court noted that in order to establish standing, the plaintiff must submit: (1) the note bearing a special endorsement in favor of the plaintiff, and (2) an assignment from payee to plaintiff or an affidavit of ownership proving its status as holder of the note. In this case, the Court found that the note endorsement in favor of the bank was not dated, the mortgage was not assigned until the day after the complaint, and the bank failed to submit evidence establishing the date on which the bank acquired possession of the note.

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