Deutsche Bank National Trust Company v. Colin F. Baker, Debbyta Baker, Mortgage Electronic, etc. ( 2016 )

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
DEUTSCHE BANK NATIONAL TRUST COMPANY, AS TRUSTEE FOR
GSAMP TRUST 2007-HSBC1 MORTGAGE PASS-THROUGH
CERTIFICATES, SERIES 2007-HSBC1,
Appellant,
v.
COLIN F. BAKER, DEBBYTA BAKER, MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC., AS NOMINEE FOR IRWIN UNION
BANK AND TRUST COMPANY, UNKNOWN TENANT IN POSSESSION 1
and UNKNOWN TENANT IN POSSESSION 2,
Appellees.
No. 4D15-1293
[ June 1, 2016 ]
Appeal from the Circuit Court for the Seventeenth Judicial Circuit,
Broward County; Barry J. Stone, Judge; L.T. Case No. CACE14005201.
Charles P. Gufford of McCalla Raymer, LLC, Orlando, for appellant.
Matthew D. Bavaro and Chase E. Jenkins of Loan Lawyers, LLC, Fort
Lauderdale, for Appellees Colin F. Baker and Debbyta Baker.
PER CURIAM.
Deutsche Bank, the plaintiff in this foreclosure action, appeals a final
order of involuntary dismissal. Because Deutsche Bank presented a prima
facie case—albeit one based upon erroneously admitted evidence of
damages—the trial court erred in granting an involuntary dismissal. 1 We
1 We find that Deutsche Bank’s other arguments for reversal are based upon
mischaracterizations of the record. For example, Deutsche Bank argues that the
trial court erred in sustaining the defense objection to evidence of the prior
servicer’s payment history, but the record shows that the trial court never ruled
on the objection; instead, before the trial court made a final determination on the
objection, Deutsche Bank’s counsel explicitly elected to proceed without
introducing evidence of the prior loan servicer’s payment history. Likewise,
Deutsche Bank argues that the trial court abused its discretion in dismissing the
action based upon an alleged discovery violation, but this claim of error rests
therefore reverse for a new trial on damages.
The standard of review for a trial court’s ruling on a motion for
involuntary dismissal is de novo. Deutsche Bank Nat’l Trust Co. v. Huber,
137 So. 3d 562, 563 (Fla. 4th DCA 2014).
Where a foreclosure plaintiff presents evidence of the amount of
damages under the loan, there is sufficient prima facie evidence of
damages to preclude an involuntary dismissal, even if the evidence of
damages was based on inadmissible hearsay that was erroneously
admitted at trial. See Beauchamp v. Bank of New York, 150 So. 3d 827,
829 n.2 (Fla. 4th DCA 2014) (reversing and remanding for further
proceedings to determine the amount due under the note, rather than
reversing for a dismissal, where “the Bank established the amount of
indebtedness through witness testimony, even though that testimony
concededly was inadmissible hearsay”); Peuguero v. Bank of Am., N.A., 169
So. 3d 1198, 1203–04 (Fla. 4th DCA 2015) (reversing for a determination
of the correct amount owed, rather than reversing for a dismissal, where
the Bank’s loan payment history reflected the amount of principal, but the
only evidence of the amount of interest came from a witness who merely
testified that the amount written on an unadmitted proposed final
judgment was correct); but compare Wolkoff v. Am. Home Mortg. Servicing,
Inc., 153 So. 3d 280, 281–82 (Fla. 2d DCA 2014) (reversing for dismissal
where the plaintiff failed to produce any evidence, admissible or not,
supporting the amount of indebtedness).
Here, the trial court dismissed the action because it found that
Deutsche Bank failed to present reliable evidence of damages. However,
we conclude that Deutsche Bank did present a prima facie case, albeit one
based upon erroneously admitted evidence of damages.
Deutsche Bank established the principal balance of the loan—the only
amount on which Deutsche Bank was seeking a judgment—through the
current servicer’s loan payment history, which was admitted into evidence
over the defense objection to the portion of the exhibit listing the starting
principal balance. The starting principal balance contained in the current
servicer’s payment history was purportedly taken from the prior servicer’s
records, which were not admitted into evidence. The court admitted the
upon a false premise. The record shows that the court did not dismiss the action
based upon the alleged discovery violation, but rather dismissed the action based
upon its conclusion that Deutsche Bank failed to present reliable evidence of
damages.
2
current servicer’s loan history into evidence “without prejudice” to defense
counsel arguing the issue concerning the starting principal balance.
However, the court later allowed Deutsche Bank’s witness to testify that
the unpaid principal balance was $362,216.30.
We have reviewed the trial testimony, and we find that Deutsche Bank
did not lay a foundation for admitting, as a business record, the starting
principal balance in the current servicer’s payment history. 2 See generally
Bank of New York v. Calloway, 157 So. 3d 1064, 1071–72 (Fla. 4th DCA
2015). Nonetheless, Deutsche Bank presented a prima facie case, even
though its evidence of damages was erroneously admitted without a proper
foundation. Having admitted into evidence Deutsche Bank’s proof of
damages, the trial court should not have granted an involuntary dismissal.
Accordingly, we reverse the involuntary dismissal and remand for a new
trial on damages. Of course, at the new trial on remand, Deutsche Bank
may introduce evidence of the prior servicer’s business records, or the
entry on the current servicer’s records concerning the starting principal
balance, if it lays the proper foundation.
Reversed and Remanded.
CIKLIN, C.J., TAYLOR and MAY, JJ., concur.
* * *
2 To be sure, the reason Deutsche Bank did not lay the proper foundation can be
traced to a defense objection to testimony about the boarding process, which
prompted a long discussion culminating in Deutsche Bank abandoning its
attempt to introduce such evidence. The defendants objected “to any testimony
regarding the boarding process,” arguing in essence that Deutsche Bank had
committed a discovery violation when Deutsche Bank refused to answer the
defendants’ interrogatory about the boarding process. Deutsche Bank had raised
a boilerplate objection to the interrogatory, claiming, among other things, that it
was not reasonably calculated to lead to the discovery of admissible evidence.
However, by proceeding to trial without obtaining a ruling on Deutsche Bank’s
objection to their interrogatory, the defendants waived any objection to Deutsche
Bank’s failure to answer. See Fla. R. Civ. P. 1.340 (Committee Note to 1972
Amendment) (“If objections are made, the interrogating party has the
responsibility of setting a hearing if that party wants an answer.”); see also Pac.
Sun Pub. Co. v. Chronicle Pub. Co., 31 Fed. R. Serv. 2d 1243, 1981 WL 380709 at
*1 (N.D. Cal. 1981) (“When plaintiffs failed to pursue an answer to the
interrogatory by a motion to compel, they in essence waived their ability to require
supplementation . . . .”).
3
Not final until disposition of timely filed motion for rehearing.
4