Stanley Streicher v. U.S. Bank National Association

Case: 16-11621 Date Filed: 12/21/2016 Page: 1 of 7
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-11621
Non-Argument Calendar
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D.C. Docket No. 9:14-cv-80265-KAM
STANLEY STREICHER,
MARSHA STREICHER,
Plaintiffs-Appellants,
versus
U.S. BANK NATIONAL ASSOCIATION,
U.S. BANK NATIONAL ASSOCIATION AS SUCCESSOR
TRUSTEE OF THE WELLS FARGO ASSET SECURITIES
CORPORATION,
Mortgage Pass-Through Certificates 2005-AR16,
Defendants-Appellees.
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Appeal from the United States District Court
for the Southern District of Florida
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(December 21, 2016)
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Before WILLIAM PRYOR, MARTIN, and ANDERSON, Circuit Judges.
PER CURIAM:
Stanley and Marsha Streicher appeal the district court’s order denying their
motion for summary judgment and granting summary judgment to the defendants.
After careful review, we affirm.
I.
In June 2010, a mortgage foreclosure action was brought against the
Streichers in Florida state court. According to the complaint, the party that brought
the foreclosure action against the Streichers was U.S. Bank National Association as
Successor Trustee to Wachovia Bank, National Association, as Trustee for Wells
Fargo Asset Securities Corporation, Mortgage Pass-Through Certificates Series
2005-AR16 (“U.S. Bank”). Although U.S. Bank was the only named plaintiff in
the foreclosure action, Wells Fargo Bank, N.A. (“Wells Fargo”), the mortgage
servicer for U.S. Bank, sought to bring the suit on U.S. Bank’s behalf. At trial,
U.S. Bank made no appearance and Wells Fargo litigated in its place. After the
close of Wells Fargo’s evidence, the state court granted the Streichers’ motion for
involuntary dismissal. The state court dismissed the case on the ground that Wells
Fargo lacked standing because it failed to prove that U.S. Bank authorized it to
bring suit on U.S. Bank’s behalf.
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The Streichers then filed this suit in state court against U.S. Bank, and U.S.
Bank removed the case to federal court.1 The Streichers seek a declaratory
judgment that the state court’s dismissal of the foreclosure action has preclusive
effect on any future actions by U.S. Bank to enforce the promissory note
underlying their mortgage. In plain English, they are asking the federal court to
bar U.S. Bank from collecting the amount the Streichers allegedly owe on their
mortgage, on the ground that the state court determined that Wells Fargo was not
the proper party to bring the original foreclosure action against them.
Both parties moved for summary judgment. The Streichers are entitled to
summary judgment (and U.S. Bank is not) if the state court’s dismissal of the
foreclosure action has preclusive effect as a matter of law, also known as res
judicata. Under Florida law, res judicata may apply only if there has been a prior
adjudication “on the merits.”2 Topps v. State, 865 So. 2d 1253, 1255 (Fla. 2004)
(per curium) (quoting Kent v. Sutker, 40 So. 2d 145, 147 (Fla. 1949)); see also
Vasquez v. YII Shipping Co., 692 F.3d 1192, 1199 (11th Cir. 2012). Thus, we
1
The Streichers’ operative complaint names U.S. Bank as a defendant in its capacity as
Trustee and in its individual capacity. We refer to both collectively as “U.S. Bank.”
2
In addition to the requirement that the earlier action be adjudicated on the merits,
Florida law also requires that “four identities” be present. See Topps, 865 So. 2d at 1255 (“The
doctrine of res judicata applies when four identities are present: (1) identity of the thing sued for;
(2) identity of the cause of action; (3) identity of persons and parties to the action; and (4)
identity of the quality of the persons for or against whom the claim is made.”). Because the state
court action was not decided on the merits, we do not reach the issue of whether the “four
identities” are satisfied.
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must decide whether, under Florida law, dismissal of a foreclosure action for lack
of standing constitutes an adjudication on the merits such that it triggers res
judicata. The district court found that it does not. The Streichers appeal that
decision.
II.
Whether to apply the doctrine of res judicata is a question we review de
novo. Norfolk S. Corp. v. Chevron, U.S.A., Inc., 371 F.3d 1285, 1288 (11th Cir.
2004). When deciding the preclusive effect of a state court judgment, we must
give that judgment the same preclusive effect that “another court of that State
would give [it].” Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280,
293, 125 S. Ct. 1517, 1527 (2005) (quotation omitted) (citing the Full Faith and
Credit Act, 28 U.S.C. § 1738). Thus, we look to what the Florida courts have said
about whether dismissal of a foreclosure action for lack of standing constitutes an
adjudication on the merits for purposes of res judicata. Because the Florida
Supreme Court has not addressed this question, we turn to the Florida appellate
courts. See Galindo v. ARI Mut. Ins. Co., 203 F.3d 771, 775 (11th Cir. 2000)
(“Absent a decision by the highest state court or persuasive indication that it would
decide the issue differently, federal courts follow decisions of intermediate
appellate courts in applying state law.”); Pardo v. State, 596 So. 2d 665, 666
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(Fla. 1992) (“[T]he decisions of the district courts of appeal represent the law of
Florida unless and until they are overruled by this Court.” (quotation omitted)).
The Florida Fifth District Court of Appeal recently decided the precise issue
before us in this case. See Brown v. M & T Bank, 183 So. 3d 1270 (Fla. Dist. Ct.
App. 2016). In Brown, the court considered “[w]hether the dismissal of a
foreclosure action for lack of standing operates as an adjudication on the merits for
purposes of res judicata.” Id. at 1270. The court held it does not. Id.We must apply the Brown decision unless there is “persuasive indication
that [the Florida Supreme Court] would decide the issue differently.” Galindo, 203
F.3d at 775. There is no indication that it would. It is well established under
Florida law that a judgment is “upon the merits” such that it carries preclusive
effect when the judgment “amounts to a declaration of the law as to the respective
rights and duties of the parties based upon the ultimate facts disclosed by the
pleadings and evidence and upon which the right of recovery depends.” J. Schnarr
& Co. v. Virginia-Carolina Chem. Corp., 159 So. 39, 42 (Fla. 1934); see also State
St. Bank & Trust Co. v. Badra, 765 So. 2d 251, 254 (Fla. Dist. Ct. App. 2000) (“A
judgment rendered on any grounds which do not involve the merits of the action
may not be used as the basis for the operation of the doctrine of res judicata.”). In
Badra, the court held that the trial court’s dismissal of a foreclosure action on the
ground that the bank “fail[ed] to comply with certain conditions precedent” under
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the mortgage was not “an adjudication on the merits” because “[a]t no time did the
court grant summary judgment on the basis that the mortgage was unenforceable.”
Badra, 765 So. 2d at 254–55. Here, like Badra, the state court made no decision as
to the enforceability of the mortgage. To the contrary, the court dismissed the
suit—and refused to reach the merits—because the party seeking relief lacked
standing. Cf. Vasquez, 692 F.3d at 1199 (holding that a Florida court’s dismissal
for forum non conveniens “was not a judgment on the merits because it did not
resolve the respective rights and duties of the parties.” (quotation omitted)).
Because a dismissal for lack of standing is not an adjudication on the merits, the
state court’s dismissal of the foreclosure action against the Streichers does not have
preclusive effect.
The Streichers claim that Florida Rule of Civil Procedure 1.420(b) supports
their argument that a dismissal for lack of standing is an adjudication on the merits.
However, Rule 1.420(b) says that, although an involuntary dismissal generally
“operates as an adjudication on the merits,” a “dismissal for lack of jurisdiction”
does not. Fla. R. Civ. P. 1.420(b). Under Florida law, it is clear that a dismissal
for lack of standing is a dismissal for lack of jurisdiction. See Rogers & Ford
Const. Corp. v. Carlandia Corp., 626 So. 2d 1350, 1352 (Fla. 1993) (“The
determination of standing to sue concerns a court’s exercise of jurisdiction to hear
and decide the cause pled by a particular party.”); Ervin v. Taylor, 66 So. 2d 816,
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817 (Fla. 1953) (en banc) (holding that the court was without jurisdiction where
there were no actual adversaries as to a present controversy). Because the state
court’s dismissal falls into the category of dismissals that the Florida Rules of Civil
Procedure expressly designate as not being “on the merits,” the state court’s
dismissal of the foreclosure action cannot have preclusive effect.
The district court was correct in its determination that the state court
dismissal does not have res judicata effect under Florida law.
AFFIRMED.
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