in the circuit court of the «circuit» judicial circuit · 2013, fannie mae filed a reply to...
TRANSCRIPT
IN THE SECOND DISTRICT COURT OF APPEAL
IN AND FOR THE STATE OF FLORIDA
FEDERAL NATIONAL MORTGAGE
ASSOCIATION,
Appellant, CASE NO.: 2D14-5165
vs.
L.T. No.: 12-CI-006707
CHARLES A. MORTON, LATASHA A.
MORTON, CHASE BANK USA N.A.,
VALENCIA PARK HOMEOWNERS'
ASSOCIATION, INC, et.al.,
Appellees.
/
ON APPEAL FROM THE CIRCUIT COURT
OF THE SIXTH JUDICIAL CIRCUIT
IN AND FOR PINELLAS COUNTY, FLORIDA
APPELLANT’S INITIAL BRIEF
Mary P. Stella
Florida Bar No.: 84553
Daniel Stein Florida Bar No.: 0117412
David Rosenberg
Florida Bar No.: 100963
POPKIN & ROSALER, P.A.
1701 West Hillsboro Blvd
Suite 400
Deerfield Beach, FL 33442
Telephone: (954) 360-9030
ATTORNEYS FOR APPELLANT
i
TABLE OF CONTENTS
TABLE OF CONTENTS ........................................................................................... i
TABLE OF AUTHORITIES ................................................................................... iii
INTRODUCTION ..................................................................................................... 1
STATEMENT OF THE CASE AND OF THE FACTS ........................................... 1
SUMMARY OF ARGUMENT ................................................................................. 6
ARGUMENT ............................................................................................................. 7
I. The Trial Court Erred in Granting the Motion for Involuntary Dismissal
Before Allowing Fannie Mae to Present any Evidence .................................. 7
II. Even if the Motion for Involuntary Dismissal Was Not Premature, the Trial
Court Erred by Weighing a Document not in Evidence when Considering the
Motion for Involuntary Dismissal .................................................................10
III. Even if the Trial Court Could Weigh the Evidence, it Had No Evidence to
Weigh .............................................................................................................13
IV. The Premature Order on Motion for Involuntary Dismissal at Trial is a
Denial of Fannie Mae’s Due Process and Constitutes Fundamental Error ...14
V. The Language in the Demand Letter more than Substantially Complies with
Paragraph Number 22 of the Mortgage .........................................................15
ii
VI. Morton’s Arguments Regarding the Content of the Demand Letter are
Insufficient Because the Demand Letter Complies with the Plain Language
of Paragraph Number 22 of the Mortgage .....................................................21
A. The Demand Letter Advises that the Loan is in Default due to Non-Payment
of a Specific Monetary Amount ....................................................................21
B. The Demand Letter Specifies the Actions Required to Cure the Default ......22
C. The Demand Letter States that Morton’s Failure to Cure the Default May
Result in Foreclosure .....................................................................................22
D. The Demand Letter Advises of the Right to Assert in the Foreclosure
Proceeding the Nonexistence of the Default .................................................23
VII. The Trial Court Erred in Denying Fannie Mae’s Motion for Rehearing ......24
CONCLUSION ........................................................................................................25
CERTIFICATION OF SERVICE............................................................................27
CERTIFICATION OF TYPEFACE COMPLIANCE .............................................27
iii
TABLE OF AUTHORITIES
Cases
A.N. v. M.F.—A.,
946 So. 2d 58 (Fla. 3d DCA 2006) ......................................................................9, 15
Allard v. Al-Nayem Int’l, Inc.,
59 So. 3d 198 (Fla. 2d DCA 2011) ............................................................................ 5
Allstate Floridian Ins. Co. v. Farmer,
104 So. 3d 1242 (Fla. 5th DCA 2012) .....................................................................16
Allstate Ins. Co. v. Manasse,
707 So. 2d 1110 (Fla. 1998) .................................................................................6, 24
Bain v. State,
730 So. 2d 296 (Fla. 2d DCA 1999) ........................................................................15
Bosem v. A.R.A. Corp.,
350 So. 2d 526 (Fla. 3d DCA 1977) ........................................................................14
Coca-Cola Bottling Co. v. Clark,
299 So. 2d 78 (Fla. 1st DCA 1974) .........................................................................14
Cohen v. Rothman,
127 So. 2d 143 (Fla. 3rd DCA 1961) .......................................................................16
Cromartie v. State,
70 So. 3d 559 (Fla. 2011) ........................................................................................... 6
iv
D’Angelo v. Fitzmaurice,
863 So. 2d 311 (Fla. 2003) ......................................................................................... 6
Day v. Amini,
550 So. 2d 169 (Fla. 2d DCA 1989) ........................................................................12
Deutsche Bank Nat'l Trust Co. v. Huber,
137 So. 3d 562 (Fla. 4th DCA 2014) ......................................................................... 6
Deutsche Bank Nat'l Trust Co. v. Santiago,
117 So. 3d 1146 (Fla. 3d DCA 2013) ........................................................................ 8
Fidelity Bank v. Krenisky,
72 Conn. App. 700 (Conn. App. Ct. 2002) ..............................................................17
Fleming v. Demps,
918 So. 2d 982 (Fla. 2d DCA 2005) ........................................................................15
Floyd v. Ott,
221 So. 2d 163 (Fla. 2d DCA 1969) ........................................................................10
Hartnett v. Fowler,
94 So. 2d 724 (Fla. 1957) .........................................................................................12
Haskin v. Haskin,
677 So. 2d 376 (Fla. 4th DCA 1996) .......................................................................11
Huff v. State,
569 So. 2d 1247 (Fla. 1990) .................................................................................6, 24
v
In re Estate of McCoy,
445 So. 2d 680 (Fla. 2d DCA 1984) .......................................................................... 9
Konsulian v. Busey Bank, N.A.,
61 So. 3d 1283 (Fla. 2d DCA 2010) ........................................................................17
Krolick v. Monroe ex rel. Monroe,
909 So. 2d 910 (Fla. 2d DCA 2005) ............................................................. 6, 24, 25
Lustig v. Garcia,
789 So. 2d 482 (Fla. 4th DCA 2001) ...................................................................9, 11
Mortgage Electronic Reg. Systems v. Goduto,
110 Conn. App. 367 (Conn. App. Ct. 2008) ............................................................17
Palm Beach Mall, Inc. v. Walker,
585 So. 2d 1149 (Fla. 4th DCA 1991) .....................................................................11
Pettry v. Pettry,
706 So. 2d 107 (Fla. 5th DCA 1998) .......................................................................15
Prida v. Transamerica Ins. Fin. Corp.
651 So. 2d 763 (Fla. 3d DCA 1995) ........................................................................17
Pullam v. Hercules Inc.,
711 So. 2d 72 (Fla. 1st DCA 1998) .........................................................................16
Sapp v. Redding,
178 So. 2d 204 (Fla. 1st DCA 1965) ......................................................................... 9
vi
Sea Tower Apartments, Inc. v. Century Nat'l Bank,
406 So. 2d 69 (Fla. 4th DCA 1981) .........................................................................11
Seaside Cmty. Dev. Corp. v. Edwards,
573 So. 2d 142 (Fla. 1st DCA 1991) .......................................................................16
Sheldon Greene & Associates, Inc. v. Williams Island Associates,
550 So. 2d 1142 (Fla. 3d DCA 1989) ......................................................................10
Sims v. New Falls Corp.,
37 So 3d 358 (Fla. 3d DCA 2010) ...........................................................................16
SJS Enters. v. Cates,
547 So. 2d 226 (Fla. 4th DCA 1989) ......................................................................... 9
Slotnick v. Slotnick,
891 So. 2d 1086 (Fla. 4th DCA 2004) .....................................................................15
St. Lucie County Bank & Trust Co. v. Aylin,
114 So. 438 (Fla. 1927) ............................................................................................16
State, Dep’t of Health & Rehabilitative Services on behalf of Williams v.
Thibodeaux,
547 So. 2d 1243 (Fla. 2d DCA 1989) ......................................................................11
Strategic Res. Group, Inc. v. Knight-Ridder, Inc.,
870 So. 2d 846 (Fla. 3d DCA 2003) ................................................................. 16, 17
Surat v. Nu-Med Pembroke,
vii
632 So. 2d 1136 (Fla. 4th DCA 1994) .....................................................................25
Tillman v. Baskin,
260 So. 2d 509 (Fla. 1972) ................................................................................ 11, 12
Turtle Lake Associates, Ltd. v. Third Financial Services, Inc.,
518 So. 2d 959 (Fla. 1st DCA 1988) .......................................................................14
U.S. Bank Nat’l Ass’n v. Busquets,
135 So. 3d 488 (Fla. 2d DCA 2014) ........................................................................17
Wachovia Mortg., FSB v. Montes,
2015 Fla. App. LEXIS 1036 (Fla. 4th DCA Jan. 28, 2015) ...................................... 9
Statutes
Fla. Stat. § 924.051(3) ..............................................................................................15
Rules
Rule 1.420(b) of the Florida Rules of Civil Procedure .................................... passim
Constitutional Provisions
Fla. Const. Art. I, § 9................................................................................................15
1
INTRODUCTION
The Appellant, Federal National Mortgage Association (“Fannie Mae”), was
the Plaintiff in the lower tribunal. The Appellee, Latasha A. Morton (“Morton”),
was a Defendant in the lower tribunal. The symbol “R” will identify the Record on
Appeal. The symbol “T” will identify the Transcript of the non-jury Trial at which
the Order on Motion for Involuntary Dismissal at Trial was entered that is being
appealed herein.
STATEMENT OF THE CASE AND OF THE FACTS
On June 1, 2006, Morton and Charles Morton (collectively, the
“Borrowers”) executed and delivered a promissory note in favor of Chase Bank
USA, N.A. in the principal sum of $139,920.00 (“Note”). (R. at 2 (¶ 5), R. at 28-
34). To secure repayment of the Note, Borrowers executed and delivered a
mortgage (“Mortgage”) on real property located at 2062 San Marino Way N,
Clearwater, Florida 33763. (R. at 2 (¶ 5), R. at 5-27). Fannie Mae is the owner
and holder of the Note. (R. at 2 (¶ 6).
Borrowers defaulted under the terms of the Note and Mortgage by failing
to make the payments due on and since June 1, 2010. (R. at 2 (¶6). On April 11,
2011, a letter was sent to Morton pursuant to paragraph number 22 of the Mortgage
(“Demand Letter”). (R. at 206-215). Due to Borrowers’ default under the terms of
the Note and Mortgage, an action to foreclose the Note and Mortgage was
2
commenced on May 24, 2012. (R. at 1-36). Morton filed her Answer and
Affirmative Defenses on October 28, 2013. (R. at 127-131). On November 12,
2013, Fannie Mae filed a reply to Morton’s Answer and Affirmative Defenses. (R.
at 170-176). Fannie Mae filed the original Note with the trial court on October 23,
2013. (R. at 117-126).
Morton filed a Motion for Summary Judgment on November 26, 2013,
alleging that the Demand Letter was deficient because it did not comply with the
notice requirements outlined in paragraph number 22 of the Mortgage. (R. at 178-
79). Specifically, the Motion for Summary Judgment alleged that the Demand
Letter “does not specify the default,” “does not specify the actions required to cure
the default, as it requires payment of unspecified sums above and beyond the
amount set forth in the letter”, “does not specify that failure to cure the default may
result in ‘foreclosure by judicial proceedings,’ as it falsely advises Defendant she
has ‘the right to bring a court action,’” and “was not sent by the Lender.” (R. at
178-179).
On December 3, 2013, Fannie Mae filed its Response in Opposition to
Defendant’s Motion for Summary Judgment (“Response”). (R. at 190-205). The
Response argued that the language contained within the Demand Letter fully
complied with paragraph number 22 of the Mortgage. (R. at 192 (¶¶ 9-11)). On
December 6, 2013, Fannie Mae filed its Affidavit in Support of Plaintiff’s Motion
3
for Summary Judgment stating that the Demand Letter was sent to Morton and
attaching a copy of the Demand Letter. (R. at 206-215). After hearing arguments
and reviewing the file, the trial court denied Morton’s Motion for Summary
Judgment. (R. at 325-326).
On July 7, 2014, an order was entered setting the case for a non-jury trial
(“Trial Order”) on October 3, 2014. (R. at 265-266). On October 3, 2014, counsel
for Fannie Mae appeared with his trial witness for the non-jury trial before the
Honorable Judge Ray E. Ulmer. (T. at p. 1, Ln. 12; T. at p. 2, Ln. 3, T. at p. 3, Ln.
3). Prior to the commencement of trial, Morton made a Motion for Involuntary
Dismissal pursuant to Rule 1.420(b) of the Florida Rules of Civil Procedure based
upon alleged deficiencies contained within the Demand Letter. (T. at p. 4-15).
Counsel for Morton argued that the Demand Letter fails to provide a detailed
explanation as to how the “Amount Due” was calculated, does not specify the
actions required to cure the default, fails to specify that failure to cure the default
may result in foreclosure, and does not advise Morton of the right to assert in the
foreclosure proceeding the nonexistence of the default. (T. at p. 5-8).
In response, counsel for Fannie Mae argued that the Demand Letter
complies with paragraph number 22 of the Mortgage. (T. at p. 8, Ln. 18-19).
Counsel for Fannie Mae explained that the Demand Letter specifies the default,
specifies the action required to cure the default, states that failure to cure the
4
default may result in foreclosure by judicial proceedings and sale of the property,
and states that “[y]ou have the right to reinstate your loan after acceleration and the
right to bring a court action or assert in a foreclosure proceeding the nonexistence
of a default.” (T. at p. 9, Ln. 2-24; T. at P. 10, Ln. 1-21).
Based on the oral argument of counsel for Morton, the trial court granted
Morton’s Motion for Involuntary Dismissal and entered the “Order on Motion for
Involuntary Dismissal at Trial.” (R. at 482). When the trial court granted the
Motion for Involuntary Dismissal, Fannie Mae’s witness had not been sworn in.
(T. at 1-15). Further, neither the Mortgage nor the Demand Letter had been
introduced into evidence. (T. at 1-13). In fact, they had not even been marked for
identification or presented for admission. (T. at 1-13). As such, there was no
Mortgage or Demand Letter for the trial court to consider. Based upon the trial
transcript, there is no way of knowing what demand letter or mortgage the trial
judge reviewed in making his decision. Notwithstanding the fact that no
documents had been admitted into evidence, the trial court weighed the language in
an unidentified document and determined that it was inadequate.
It was only after the trial court granted Morton’s Motion for Involuntary
Dismissal that Fannie Mae’s witness was sworn in. (T. at p. 15, Ln. 1-4). Fannie
Mae was not given the opportunity to present its case. Instead, Fannie Mae was
only permitted to proffer its case after it had already been dismissed.
5
On October 15, 2014, Fannie Mae timely filed its Motion for Rehearing
and Reconsideration of the Order on Motion for Involuntary Dismissal at Trial
(“Motion for Rehearing”). (R. at 483-504). The Motion for Rehearing alleged
that: (1) the Motion for Involuntary Dismissal did not comply with Rule 1.420(b)
of the Florida Rules of Civil Procedure because it was made before Fannie Mae
presented its prima facie case at trial; (2) the trial court improperly weighed a
document not in evidence when it ruled on Morton’s Motion for Involuntary
Dismissal; and (3) the Demand Letter did in fact comply with the notice
requirements contained in paragraph number 22 of the Mortgage. (R. at 483-496).
The trial court denied Fannie Mae’s Motion for Rehearing on October 17, 2014.
(R. at 505-506).
STANDARD OF REVIEW
A trial court’s order granting a motion for involuntary dismissal is reviewed
de novo on appeal. Allard v. Al-Nayem Int’l, Inc., 59 So. 3d 198, 201 (Fla. 2d
DCA 2011). “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." Deutsche Bank Nat'l Trust Co. v. Huber, 137 So. 3d 562, 563-
64 (Fla. 4th DCA 2014).
6
A trial court’s decision to deny a request for a new trial is reviewed for
abuse of discretion on appeal. Krolick v. Monroe ex rel. Monroe, 909 So. 2d 910,
913 (Fla. 2d DCA 2005). “The appellate court should apply the reasonableness
test to determine whether the trial judge abused his discretion, to wit, ‘discretion is
abused only where no reasonable [person] would take the view adopted by the trial
court.’” Allstate Ins. Co. v. Manasse, 707 So. 2d 1110, 1111 (Fla. 1998) (quoting
Huff v. State, 569 So. 2d 1247, 1249 (Fla. 1990)). Additionally, it takes “a greater
showing to reverse an order granting a new trial than one denying a new trial.”
Krolick, 909 So. 2d at 912 (citing Manasse, 707 So. 2d 1110).
The standard of review for fundamental error is de novo. Cromartie v. State,
70 So. 3d 559, 564 (Fla. 2011) (citing D’Angelo v. Fitzmaurice, 863 So. 2d 311,
314 (Fla. 2003)).
SUMMARY OF ARGUMENT
Morton’s Motion for Involuntary Dismissal was premature pursuant to
Rule 1.420(b) of the Florida Rules of Civil Procedure because it was made before
Fannie Mae was able to present any of its case at trial. Even if it is determined that
the Motion for Involuntary Dismissal was not premature, the trial court erred by
weighing a document not in evidence when considering the Motion for Involuntary
Dismissal. Further, even if the trial court could have weighed the evidence, it had
no evidence to weigh as no testimony was taken and no exhibits were introduced
7
into evidence. In addition, the trial court denied Fannie Mae due process by
prematurely granting the Motion for Involuntary Dismissal. Fannie Mae’s denial of
due process constitutes fundamental error.
Even assuming, arguendo, that the trial court properly considered the
Motion for Involuntary Dismissal, Fannie Mae complied with paragraph number
22 of the Mortgage. The Demand Letter specifies the default, the actions required
to cure the default, that failure to cure the default may result in foreclosure by
judicial proceedings, advises of the right to reinstate the loan after acceleration,
and assert defenses in a foreclosure proceeding. The trial court abused its
discretion in denying Fannie Mae’s Motion for Rehearing.
For the forgoing reasons, the trial court erred in granting the Motion for
Involuntary Dismissal and this Court should vacate the Order on Motion for
Involuntary Dismissal at Trial and remand the case for a new trial.
ARGUMENT
I. The Trial Court Erred in Granting the Motion for Involuntary
Dismissal Before Allowing Fannie Mae to Present any Evidence
Pursuant to the Trial Order, a non-jury trial was set for October 3, 2014 at
9:00 am. (R. at 265-266). Before the trial commenced, Morton made a Motion for
Involuntary Dismissal pursuant to Rule 1.420(b) of the Florida Rules of Civil
Procedure. (T. at p. 4-15). Morton’s Motion for Involuntary Dismissal was granted
8
by the trial court before Fannie Mae had the opportunity to commence the
presentation of its case. Id. In fact, Fannie Mae’s witness was not even sworn in
and Fannie Mae had no opportunity to present any evidence or testimony in
support of its case before it was dismissed. Id.
Rule 1.420(b) of the Florida Rules of Civil Procedure provides in
pertinent part that:
After a party seeking affirmative relief in an action
tried by the court without a jury has completed the
presentation of evidence, any other party may move
for a dismissal on the ground that on the facts and the
law the party seeking affirmative relief has shown no
right to relief, without waiving the right to offer evidence
if the motion is not granted. The court as trier of the
facts may then determine them and render judgment
against the party seeking affirmative relief or may
decline to render judgment until the close of all the
evidence . . . .
(emphasis added). In applying Rule 1.420(b) of the Florida Rules of Civil
Procedure, Florida courts have held that an involuntary dismissal may not be
entered before the plaintiff has completed the presentation of its evidence. See
Deutsche Bank Nat'l Trust Co. v. Santiago, 117 So. 3d 1146, 1146-47 (Fla. 3d
DCA 2013) (reversing trial court's sua sponte involuntary dismissal of the case
entered before bank completed examination of its witness); A.N. v. M.F.—A., 946
So. 2d 58, 60 (Fla. 3d DCA 2006) ("By denying appellants the opportunity to
complete their case-in-chief, the trial court denied appellants their due process.");
9
Lustig v. Garcia, 789 So. 2d 482, 483 (Fla. 4th DCA 2001) ("[A]n involuntary
dismissal may not be entered before the plaintiff has completed the presentation of
his evidence."); SJS Enters. v. Cates, 547 So. 2d 226, 227 (Fla. 4th DCA 1989)
(trial court cannot “jump the gun” by granting involuntary dismissal while plaintiff
was presenting its first witness).
This Court considered the application of Rule 1.420(b) of the Florida
Rules of Civil Procedure in In re Estate of McCoy, 445 So. 2d 680 (Fla. 2d DCA
1984). In McCoy, this Court reversed an order granting a motion for involuntary
dismissal that was entered prior to the plaintiff resting her case. Id. This Court
reasoned that “[e]very party litigant is entitled to his ‘day in court,’ and this
includes the right of a plaintiff to present admissible evidence in an attempt to
prove the cause of action he has alleged, even though the testimony of his first
witnesses may indicate that he has a weak case or none at all.” Id. at 683 (citing
Sapp v. Redding, 178 So. 2d 204, 206 (Fla. 1st DCA 1965)).
It is improper to grant a motion for involuntary dismissal when the
plaintiff has just begun presenting its case. See Wachovia Mortg., FSB v. Montes,
2015 Fla. App. LEXIS 1036 (Fla. 4th DCA Jan. 28, 2015) (holding that the
granting of a motion for involuntary dismissal was improper when bank has only
scarcely started presenting its case); Sheldon Greene & Associates, Inc. v. Williams
Island Associates, 550 So. 2d 1142 (Fla. 3d DCA 1989) (holding that it was error
10
to dismiss a case as a matter of law after hearing only opening statements). But cf.
Floyd v. Ott, 221 So. 2d 163, 164 (Fla. 2d DCA 1969) (noting that “there may be
instances in which some fact which is uncontroverted and uncontrovertible [sic]
may be elicited at trial which determines the case as a matter of law.”).
Here, Fannie Mae had not even started the presentation of its case when
the Motion for Involuntary Dismissal was heard. (T. at p. 4-15). As such, the
Motion for Involuntary Dismissal was prematurely and this Court should vacate
the Order on Motion for Involuntary Dismissal at Trial and remand for a properly
held trial.
II. Even if the Motion for Involuntary Dismissal Was Not Premature,
the Trial Court Erred by Weighing a Document not in Evidence
when Considering the Motion for Involuntary Dismissal
Morton’s premature Motion for Involuntary Dismissal was based upon an
alleged deficiency in the language of the Demand Letter sent to Morton. (T. at p. 6-
8). Morton argued that the Demand Letter fails to provide a detailed explanation
as to how the “Amount Due” was calculated, to specify the actions required to cure
the default, to specify that failure to cure the default may result in foreclosure, and
to advise Morton of the right to assert in the foreclosure proceeding the
nonexistence of the default. (T. at p. 5-8). The trial court weighed a document not
in evidence and determined that this document was inadequate. (T. at p. 13, Ln. 3-
14).
11
After a plaintiff has rested, it is well-established that a trial court may not
weigh the evidence or the credibility of witnesses in ruling on a motion for
involuntary dismissal. Lustig v. Garcia, 789 So. 2d 482, 483 (Fla. 4th DCA 2001);
see also Haskin v. Haskin, 677 So. 2d 376, 377 (Fla. 4th DCA 1996); Palm Beach
Mall, Inc. v. Walker, 585 So. 2d 1149, 1150 (Fla. 4th DCA 1991); Sea Tower
Apartments, Inc. v. Century Nat'l Bank, 406 So. 2d 69 (Fla. 4th DCA 1981).
Rather, such a decision is limited to determining whether the plaintiff has
presented a prima facie case. See Sea Tower Apartments, 406 So. 2d at 70; Lustig,
789 So. 2d at 483; Capital Media v. Haase, 639 So. 2d 632, 633 (Fla. 2d DCA
1994) (“This court and others have consistently held that on a motion for
involuntary dismissal, made at the close of the plaintiff’s case in a nonjury trial, a
trial court is limited to determining whether or not the plaintiff has made a prima
facie case.”); Tillman v. Baskin, 260 So. 2d 509, 511-12 (Fla. 1972); State, Dep’t of
Health & Rehabilitative Services on behalf of Williams v. Thibodeaux, 547 So. 2d
1243, 1244 (Fla. 2d DCA 1989) (“A trial judge cannot weigh evidence when ruling
on a defendant’s rule 1.420(b) motion for involuntary dismissal following the
presentation of a prima face case by a plaintiff.”).
The Florida Supreme Court has held that the trial court cannot weigh the
evidence presented by the plaintiff when ruling on a motion for involuntary
dismissal. Tillman, 260 So. 2d at 511-12. The Florida Supreme Court stated:
12
It is inconceivable that a trial judge can fairly find for a
defendant after hearing nothing more than testimony
from a plaintiff establishing a prima facie case in the
plaintiff’s favor. We hold that a trial judge cannot weigh
evidence when ruling on a defendant’s Rule 1.420(b)
F.R.C.P. motion for involuntary dismissal following the
presentation of a prima facie case by a plaintiff.
Id.
Additionally, this Court has held that when a party makes a motion for
involuntary dismissal, “the movant admits the truth of all facts in evidence and
every reasonable conclusion or inference based thereon favorable to the non-
moving party.” Day v. Amini, 550 So. 2d 169, 171 (Fla. 2d DCA 1989); Hartnett
v. Fowler, 94 So. 2d 724, 725 (Fla. 1957) (“It is also well settled that a party who
moves for a directed verdict admits for the purpose of testing the motion the facts
in evidence and in addition admits every reasonable and proper conclusion based
thereon which is favorable to the adverse party.”).
In the case at bar, the trial court improperly weighed a document not in
evidence by evaluating the adequacy of this document when ruling on Morton’s
Motion for Involuntary Dismissal. The trial court was limited to determining only
whether Fannie Mae had established a prima facie case and it was improper for the
trial court to conduct a deeper evaluation of the adequacy of the Demand Letter.
As such, the trial court erred in granting the Motion for Involuntary Dismissal and
13
this Court should vacate the Order on Motion for Involuntary Dismissal at Trial
and remand for a new trial.
III. Even if the Trial Court Could Weigh the Evidence, it Had No
Evidence to Weigh
Morton’s premature Motion for Involuntary Dismissal was based upon
Morton’s allegation that the Demand Letter did not comply with paragraph number
22 of the Mortgage. (T. at p. 6-8). Morton argued that the Demand Letter fails to
provide a detailed explanation as to how the “Amount Due” was calculated, to
specify the actions required to cure the default, to specify that failure to cure the
default may result in foreclosure, and to advise Morton of the right to assert in the
foreclosure proceeding the nonexistence of a default. (T. at p. 5-8). The trial
court weighed a document not in evidence and determined it was inadequate. (T.
at p. 13, Ln. 3-14). When the trial court granted the Motion for Involuntary
Dismissal, neither the Mortgage nor the Demand Letter had been introduced into
evidence. In fact, they had not even been marked for identification or presented
for admission. As such, there was no Mortgage or Demand Letter for the trial
court to consider. Based upon the trial transcript, there is no way of knowing what
demand letter or mortgage the trial court reviewed in making its decision.
Documents that have not been properly admitted into evidence cannot
form the basis of a trial court’s ruling. See Bosem v. A.R.A. Corp., 350 So. 2d 526,
528 (Fla. 3d DCA 1977); Turtle Lake Associates, Ltd. v. Third Financial Services,
14
Inc., 518 So. 2d 959 (Fla. 1st DCA 1988); Coca-Cola Bottling Co. v. Clark, 299
So. 2d 78 (Fla. 1st DCA 1974).
Because the Mortgage and the Demand Letter were not properly
authenticated and entered into evidence, the trial court should not have considered
them in ruling on the Motion for Involuntary Dismissal. As such, this Court
should vacate the Order on Motion for Involuntary Dismissal at Trial and remand
for a new trial.
IV. The Premature Order on Motion for Involuntary Dismissal at Trial is a
Denial of Fannie Mae’s Due Process and Constitutes Fundamental Error
When the trial court granted the Motion for Involuntary Dismissal,
Fannie Mae’s witness had not even been sworn in. (T. at P. 1-15). Further, neither
the Mortgage nor the Demand Letter had been introduced into evidence. (T. at P.
1-13). In fact, they had not even been marked for identification or presented for
admission. (T. at P. 1-13). It was only after the trial judge granted Morton’s
Motion for Involuntary Dismissal that Fannie Mae’s witness was sworn in. (T. at
P. 15, Ln. 1-4). Fannie Mae was not given the opportunity to present its case.
Instead, Fannie Mae was only permitted to proffer its case after it had already been
dismissed.
The dismissal of an action at trial prior to the plaintiff’s complete
presentation of its case constitutes a denial of plaintiff’s due process. A.N. v. M.F.-
A., 946 So. 2d at 60 (“By denying appellants the opportunity to complete their
15
case-in-chief, the trial court denied appellants their due process.”); Slotnick, 891
So. 2d at 1089 (finding that “the trial court committed reversible error when it
denied the former wife’s request to present evidence.”).
The denial of due process is fundamental error. Fleming v. Demps, 918 So.
2d 982, 984 (Fla. 2d DCA 2005) (reaffirming that “due process requires that a
party be given the opportunity to be heard and to testify and call witnesses on his
behalf, and the denial of this right is fundamental error.”) (quoting Pettry v. Pettry,
706 So. 2d 107, 108 (Fla. 5th DCA 1998)); see Fla. Const. Art. I, § 9.
Fundamental error does not require a simultaneous objection to be preserved for
appellate review. Fla. Stat. § 924.051(3); see Bain v. State, 730 So. 2d 296, 300
(Fla. 2d DCA 1999).
The trial court denied Fannie Mae due process by prematurely granting the
Motion for Involuntary Dismissal. Fannie Mae’s denial of due process constitutes
fundamental error and this Court should vacate the Order on Motion for
Involuntary Dismissal at Trial and remand for a new trial.
V. The Language in the Demand Letter more than Substantially Complies
with Paragraph Number 22 of the Mortgage
Even absent the forgoing arguments, the trial court erred in granting the
Motion for Involuntary Dismissal because the language contained within the
Demand Letter more than substantially complies with paragraph number 22 of the
16
Mortgage. “Courts require there to be at least substantial compliance with
conditions precedent in order to authorize performance of a contract.” Allstate
Floridian Ins. Co. v. Farmer, 104 So. 3d 1242, 1246 (Fla. 5th DCA 2012) (citing
Seaside Cmty. Dev. Corp. v. Edwards, 573 So. 2d 142, 145 (Fla. 1st DCA 1991));
Cohen v. Rothman, 127 So. 2d 143, 147 (Fla. 3rd DCA 1961). A mortgage is a
contract and therefore contract interpretation and principles apply to its review.
Sims v. New Falls Corp., 37 So 3d 358, 361 (Fla. 3d DCA 2010).
“Substantial performance is performance ‘nearly equivalent to what was
bargained for.’” Strategic Res. Group, Inc. v. Knight-Ridder, Inc., 870 So. 2d 846,
848 (Fla. 3d DCA 2003) (quoting Pullam v. Hercules Inc., 711 So. 2d 72, 75 (Fla.
1st DCA 1998)). Courts have long recognized that strict interpretation of a
contract may thwart its purpose. St. Lucie County Bank & Trust Co. v. Aylin, 114
So. 438, 441 (Fla. 1927). Indeed, contractual interpretation and enforcement often
entails consideration of the surrounding circumstances and apparent intent of the
parties. Id. For example, in Strategic Res. Group, Inc., the court held that a
publisher substantially complied with a contract where it published an image that
had been reduced by 3.83% from the contractually agreed image quality. Id. at
848. Similarly, the court in Prida v. Transamerica Ins. Fin. Corp. 651 So. 2d 763,
764 (Fla. 3d DCA 1995) held that a notice of cancellation printed in 9.5-point type
17
substantially complied with the underlying insurance contract, even though that
contract required a 12-point type notice of cancellation.
Accordingly, the content of a demand letter need not be a verbatim
recitation of the notice language stated in a mortgage. See e.g. U.S. Bank Nat’l
Ass’n v. Busquets, 135 So. 3d 488, 490 (Fla. 2d DCA 2014) (holding that “the
language of the Bank’s notice meets the notice requirements set forth in the plain
language of the mortgage contract.”); Konsulian v. Busey Bank, N.A., 61 So. 3d
1283, 1285 (Fla. 2d DCA 2010) (“Under Florida law, contracts are construed in
accordance with their plan language, as bargained for by the parties.”). Appellate
courts in other jurisdictions have held that a demand letter is sufficient if it notifies
the borrower of her rights, obligations, and remedies as stated in the plain language
of the Mortgage. See Mortgage Electronic Reg. Systems v. Goduto, 110 Conn.
App. 367, 375 (Conn. App. Ct. 2008) (refusing to require “mechanistic
compliance” with the notice provisions if “the actual notice received resulted in no
prejudice and fairly appraised the noticed party of its contractual rights.”). The
strict replication of contractual language is often unnecessary. Fidelity Bank v.
Krenisky, 72 Conn. App. 700, 710 (Conn. App. Ct. 2002) (holding that “literal
enforcement of the relevant notice provision would serve no purpose because the
defendants had actual notice of their right to reinstate the mortgage after
acceleration.”).
18
In the instant case, the language contained within the Demand Letter
more than substantially complied with the notice requirements stated in paragraph
number 22 of the Mortgage. Paragraph numbered 22 of the Mortgage states in
relevant part:
Acceleration; Remedies. Lender shall give notice to
Borrower prior to acceleration following Borrower’s
breach of any covenant or agreement in this Security
Instruction (but not prior to acceleration under Section 18
unless Applicable Law provides otherwise). The notice
shall specify: (a) the default; (b) the action required to
cure the default; (c) a date, not less than 30 days from the
date the notice is given to Borrower, by which the default
must be cured; and (d) that failure to cure the default on
or before the date specified in the notice may result in
acceleration of the sums secured by this Security
Instrument, foreclosure by judicial proceeding and sale of
the Property. The notice shall further inform Borrower of
the right to reinstate after acceleration and the right to
assert in the foreclosure proceeding the nonexistence of a
default or any other defense of Borrower to acceleration
and foreclosure.
(R. at 18).
A comparison of the language contained in the Demand Letter with the
information required by paragraph number 22 of the Mortgage demonstrates that
the Demand Letter more than substantially complies with paragraph number 22 of
the Mortgage:
a) Information Required by Paragraph 22: “The default.”
19
Language in the Demand Letter: “Your loan is in default, arising from
the non-payment of the following amount: Amount Due: $11,519.00.”
b) Information Required by Paragraph 22: “The action required to cure the
default.”
Language in the Demand Letter: “We hereby demand that you cure this
default by payment of the amount shown above.”
c) Information Required by Paragraph 22: “A date, more than 30 days from
the date of the letter by which the default must cured.”
Language in the Demand Letter: The default must be cured by “May 16,
2011.” This date is more than 30 days from April 11, 2011, the date the
Demand Letter was sent to Morton.
d) Information Required by Paragraph 22: “That failure to cure the default
on or before the date specified in the notice may result in acceleration of
the sums secured by the mortgage, foreclosure by judicial proceedings,
and sale of the property.”
Language in the Demand Letter: “Failure to cure the default will result in
acceleration of the sums secured by the mortgage and may result in the
sale of the premises . . . IF THE DEFAULT IS NOT CURED ON OR
BEFORE THE EXPIRATION DATE, THE LOAN OWNER … MAY
20
PROCEED WITHOUT FURTHER NOTICE TO COMMENCE
FORECLOSURE PROCEEDINGS.”
e) Information Required by Paragraph 22: “That Borrower has the right to
reinstate after acceleration.”
Language in the Demand Letter: “You have the right to reinstate your
loan after acceleration . . .”
f) Information Required by Paragraph 22: “That Borrower has the right to
assert in the foreclosure proceeding the non-existence of the default or
any other defense of Borrower to acceleration and foreclosure.”
Language in the Demand Letter: “You have the right to reinstate your
loan after acceleration and the right to bring a court action or assert in the
foreclosure proceedings the nonexistence of a default or any other
defense to acceleration and sale.”
(R. at 18, 503-504).
Accordingly, the trial court should not have granted Morton’s Motion for
Involuntary Dismissal because the language contained within the Demand Letter
more than substantially complies with the requirements of paragraph number 22 of
the Mortgage.
21
VI. Morton’s Arguments Regarding the Content of the Demand Letter are
Insufficient Because the Demand Letter Complies with the Plain
Language of Paragraph Number 22 of the Mortgage
A. The Demand Letter Advises that the Loan is in Default due to Non-
Payment of a Specific Monetary Amount
The Motion for Involuntary Dismissal alleged that the Demand Letter is
defective because it does not provide a detailed explanation as to how the “Amount
Due” was calculated. (T. at P. 6 Ln. 1-3). Yet paragraph number 22 of the
Mortgage does not require a detailed explanation, but just “the default.” (R. at 18).
Here, the Demand Letter specifies that the borrower is in default because she failed
to pay a specific amount: “Your loan is in default, arising from the non-payment of
the following amount: Amount Due: $11,519.00.” (R. at 503).
Morton cited Judy v. MSMC Venture, LLC, 100 So. 3d 1287 (Fla. 2d
DCA 2012) in support of her Motion for Involuntary Dismissal. (T. at P. 5 Ln.
23). However, Judy is inapplicable because it involved a substantively different
demand letter, and that demand letter was defective because it only “generally
alleged that the Judys committed a breach.” Id. at 1289. By contrast, the Demand
Letter in the instant case identifies the breach that caused the default: “Your loan is
in default, arising from the non-payment of the following amount: Amount Due:
$11,519.00.” (R. at 503).
22
B. The Demand Letter Specifies the Actions Required to Cure the Default
The Motion for Involuntary Dismissal also alleged that the Demand
Letter fails to specify the actions required to cure the default. Specifically, Morton
argued that the language in the Demand Letter creates confusion as to the amount
the borrower is supposed to pay to cure the default because the Demand Letter
states: “in addition your regular payment may become due by the expiration date.
The delinquent amount of principal continues to accrue interest.” (T. at P. 6, Ln.
25, P. 7 Ln. 1-4 and Ln. 7-9).
However, the Demand Letter also states that the default will be cured “by
payment of the amount shown above.” (R. at 503). The “amount shown above” is
a clear and distinct number: “Amount Due: $11,519.00.” (R. at 503). The
Demand Letter also specifies the possible methods of payment: “certified check,
cashier’s check, or money order.” (R. at 503). It provides a date by which the
borrower must pay the “Amount Due” to cure the default. (R. at 503). These
detailed instructions specify the actions required to cure the default.
C. The Demand Letter States that Morton’s Failure to Cure the Default
May Result in Foreclosure
The Motion for Involuntary Dismissal also alleges that the Demand
Letter fails to specify that failure to cure the default may result in foreclosure. In
support thereof, Morton focused on one sentence in the Demand Letter: “Failure to
23
cure the default will result in acceleration of the sums secured by the mortgage and
may result in the sale of the premises.” (R. at 503). However, this sentence is
mandated by paragraph number 22 of the Mortgage, which requires the Demand
Letter to specify “[t]hat failure to cure the default on or before the date specified in
the notice may result in acceleration of the sums secured by the mortgage,
foreclosure by judicial proceedings, and sale of the property.” (R. at 503).
The next paragraph of the Demand Letter contains the required language
that Morton argued was missing, namely that failure to cure the default could result
in foreclosure proceedings. The Demand Letter states:
IF THE DEFAULT IS NOT CURED ON OR BEFORE
THE EXPIRATION DATE, THE LOAN OWNER AND
WE INTEND TO ENFORCE THE LOAN OWNER’S
RIGHTS AND REMEDIES AND MAY PROCEED
WITHOUT FURTHER NOTICE TO COMMENCE
FORECLOSURE PROCEEDINGS.
(R. at 503).
D. The Demand Letter Advises of the Right to Assert in the Foreclosure
Proceeding the Nonexistence of the Default
The Motion for Involuntary Dismissal asserted that the Demand Letter
fails to advise of the right to assert in the foreclosure proceeding the nonexistence
of the default because it states Morton has a “right to bring a court action . . .” (T.
at P. 7 Ln. 24-25, P. 8 Ln. 1-3). In highlighting these words, Morton failed to
24
mention the remainder of the sentence in the Demand Letter, which does in fact
contain the required language. The full sentence in the Demand Letter reads:
You have the right to reinstate your loan after
acceleration and the right to bring a court action or assert
in the foreclosure proceedings the nonexistence of a
default or any other defense to acceleration and sale.
(R. at 503). This sentence in the Demand Letter advises of the right to assert in a
foreclosure proceeding the nonexistence of the default, and therefore complies with
the plain language of paragraph number 22 of the Mortgage.
For the preceding reasons, Morton’s arguments regarding the Demand
Letter were insufficient, and the trial court erred in granting Morton’s Motion for
Involuntary Dismissal.
VII. The Trial Court Erred in Denying Fannie Mae’s Motion for Rehearing
A trial court’s decision to deny a request for new trial is reviewed for abuse
of discretion on appeal. Krolick, 909 So. 2d at 913. “The appellate court should
apply the reasonableness test to determine whether the trial judge abused his
discretion, to wit, ‘discretion is abused only where no reasonable [person] would
take the view adopted by the trial court.’” Allstate Ins. Co., 707 So. 2d at 1111
(quoting Huff, 569 So. 2d at 1249). Additionally, it takes “a greater showing to
reverse an order granting a new trial than one denying a new trial.” Krolick, 909
So. 2d at 912 (citing Manasse, 707 So. 2d 1110).
25
Specifically, “[a] trial judge is authorized to grant a new trial when he or she
becomes aware of a specific or substantial prejudicial error or when he or she finds
that the jury verdict is ‘contrary to the manifest weight of the evidence.’” Krolick,
909 So. 2d at 914 (quoting Ford v. Robinson, 403 So. 2d 1379, 1382 (Fla. 4th
DCA 1981) (citing Collins Fruit Co. v. Giglio, 184 So. 2d 447 (Fla. 2d DCA
1966))).
Fannie Mae should have been permitted to proceed with the trial as
scheduled and permitted to introduce all of its evidence for the trier of fact to
review. As the court in Surat v. Nu-Med Pembroke, 632 So. 2d 1136 (Fla. 4th
DCA 1994) observed, “[t]he appearance of justice, alone, dictates requiring a
meaningful opportunity to be heard, given the oppressive result of dismissal at the
start of trial after a plaintiff has witnesses present and ready for trial, and following
substantial expense and preparation.” Id. at 1137.
CONCLUSION
Morton’s Motion for Involuntary Dismissal was premature and thus did
not comply with Fla. R. Civ. P. 1.420(b) as it was made before Fannie Mae
commenced the presentation of its case at trial. The trial court also erred by
weighing documents not in evidence when hearing the Motion for Involuntary
Dismissal as Rule 1.420(b) of the Florida Rules of Civil Procedure does not permit
the trial court to weigh evidence.
26
Additionally, the Motion for Involuntary Dismissal was ostensibly based
on the language contained within the Demand Letter, but no demand letter or
mortgage was admitted into evidence. It is not clear from the record what demand
letter the trial court was considering when it granted the Motion for Involuntary
Dismissal as it was not properly authenticated and admitted into evidence at that
time. Assuming the trial court had allowed Fannie Mae to proceed with the trial
and admitted the Demand Letter and Mortgage into evidence, the content of the
Demand Letter complies with paragraph number 22 of the Mortgage.
The trial court also failed to apply the applicable standard when
reviewing compliance with conditions precedent. Instead of determining whether
the Demand Letter at least substantially complied with the notice requirements
contained in the plain language of the mortgage contract, the trial court arguably
applied a strict standard of compliance with conditions precedent. Further error
occurred when the trial court then held that the Demand Letter did not specify the
default, the actions required to cure the default, that failure to cure the default
might result in foreclosure proceedings, and the right to assert in the foreclosure
proceedings the nonexistence of a default. The Demand Letter does contain this
required language.
The denial of Fannie Mae’s request for a rehearing or new trial after
raising these issues was prejudicial and an abuse of discretion. Fannie Mae
27
respectfully requests that this Court vacate the Order granting the Motion for
Involuntary Dismissal and remand the case for a new trial.
CERTIFICATION OF SERVICE
I HEREBY CERTIFY that a true and correct copy of the foregoing has been
furnished by E-Mail to: Mark P. Stopa, Esq., 2202 N. Westshore Blvd., Suite 200,
Tampa, FL 33607, Primary e-mail: [email protected],
Secondary e-mail: [email protected], this 26th
day of February, 2015.
/s/ Mary Pascal Stella
MARY PASCAL STELLA
/s/ Daniel Stein
DANIEL STEIN
CERTIFICATION OF TYPEFACE COMPLIANCE
I HEREBY CERTIFY that Appellant’s Initial Brief has been submitted in
Times New Roman 14-point type in complaince with the font requirements of Rule
9.210(a)(2) of the Florida Rules of Appellate Procedure.
/s/ Mary Pascal Stella
MARY PASCAL STELLA
/s/ Daniel Stein
DANIEL STEIN