JUSTIN FRIEDLE and SANDRA FRIEDLE v. THE BANK OF NEW YORK MELLON, etc.

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
JUSTIN FRIEDLE and SANDRA FRIEDLE,
Appellants,
v.
THE BANK OF NEW YORK MELLON, f/k/a THE BANK OF NEW YORK,
as successor-in-interest to JPMORGAN CHASE BANK, N.A., as trustee
for STRUCTURED ASSET MORTGAGE INVESTMENTS II INC., BEAR
STEARNS ALT-A TRUST, MORTGAGE PASSTHROUGH CERTIFICATES,
SERIES 2005-10,
Appellee.
No. 4D15-1750
[September 27, 2017]
Appeal from the Circuit Court for the Seventeenth Judicial Circuit,
Broward County; Kathleen D. Ireland, Judge; L.T. Case No. CACE12-
32115.
Thomas Erskine Ice of Ice Appellate, Royal Palm Beach, for appellants.
William L. Grimsley and N. Mark New, II of McGlinchey Stafford,
Jacksonville, for appellee.
William P. Keller of Akerman LLP, Fort Lauderdale, and Nancy M.
Wallace of Akerman LLP, Tallahassee, for Amicus Curiae Mortgage
Bankers Association.
ON MOTION FOR REHEARING
WARNER, J.
We grant the motions for rehearing and clarification filed by appellee
and amicus, withdraw the opinion, and substitute the following opinion in
its place.
Appellants challenge a final judgment of foreclosure, contending that
the Bank failed to prove standing. Because the appellee did not prove that
the Bank had possession of the note and was thus a holder at the time of
the filing of the complaint, we reverse.
The standard of review in determining whether a party has standing to
bring an action is de novo. Boyd v. Wells Fargo Bank, N.A., 143 So. 3d
1128, 1129 (Fla. 4th DCA 2014). To prove standing in a mortgage
foreclosure case, the plaintiff must prove its status as a holder of the note
at the time of the filing of the complaint as well as at trial. See Rigby v.
Wells Fargo Bank, N.A., 84 So. 3d 1195 (Fla. 4th DCA 2012). In this case,
the foreclosing bank’s witness could not testify that the Bank had
possession of the note prior to filing the complaint. The Bank conceded
that it presented no testimony that its present servicer or its prior servicer
had possession of the note at the inception of the foreclosure action.
At trial, the Bank attempted to prove possession of the note through a
Pooling and Service Agreement (“PSA”). That document purports to show
the transfer of the mortgage loan to the Bank as trustee. Appellant
objected to the admission of this evidence, which the court allowed on the
ground that it was self-authenticating under section 90.902, Florida
Statutes (2016). While it was certified by the Securities and Exchange
Commission (“SEC”) as being filed with that agency, and thus was self-
authenticating, there is a difference between authentication and
admissibility. Charles Ehrhardt explains the difference:
Documents must be authenticated before they are admissible
evidence . . . . Even after a document is authenticated, it will
not be admitted if another exclusionary rule is applicable. For
example, when a document is hearsay, it is inadmissible even
if it has been properly authenticated.
Charles W. Ehrhardt, Florida Evidence § 902.1 (2017 ed.). Here, the PSA
purportedly establishes a trust of pooled mortgages, but this particular
mortgage was not referenced in the documents filed with the SEC.
Appellant objected that the document was hearsay, as none of the
exceptions to the hearsay rule were established. The Bank did not present
sufficient evidence through its witness to admit this unsigned document
as its business record. While the witness testified that a mortgage loan
schedule, which listed the subject mortgage, was part of the Bank’s
business records, the mortgage loan schedule itself does not purport to
show that the actual loan was physically transferred. And it is clear from
the testimony that the witness had no knowledge of the workings of the
PSA or MLS, nor did any other document or testimony show that the note
was transferred to the Bank in accordance with the terms of the PSA.
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Therefore, the evidence in this case does not establish that this mortgage
note was within the possession of the Bank as Trustee at the time suit was
filed. 1
In its answer brief, the Bank also relies on Ortiz v. PNC Bank, National
Ass’n, 188 So. 3d 923 (Fla. 4th DCA 2016), to support the court’s rulings
under a tipsy coachman analysis. In Ortiz, we created a presumption of
standing if the note attached to the complaint was the same as the note
introduced at trial. We said:
[I]f the Bank later files with the court the original note in the
same condition as the copy attached to the complaint, then we
agree that the combination of such evidence is sufficient to
establish that the Bank had actual possession of the note at
the time the complaint was filed and, therefore, had standing
to bring the foreclosure action, absent any testimony or
evidence to the contrary.
Id. at 925 (emphasis added). Here, the note attached to the complaint was
not in the same condition as the original note introduced at trial, as pointed
out by the appellants in their reply brief. Although the differences may
seem minor, Ortiz infers possession at the time of filing suit where the copy
attached to the complaint and the original are the same, as the copy must
have been made from the original note at the time that the complaint was
filed, without evidence to the contrary. Where the copy differs from the
original, the copy could have been made at a significantly earlier time and
does not carry the same inference of possession at the filing of the
complaint. In this case, as Ortiz had not been decided at the time of the
trial, no effort was made to explain the discrepancies in the condition of
the note attached to the complaint or the original introduced into evidence.
Thus, reliance on Ortiz under a tipsy coachman analysis is not appropriate
on the record made in this case. Although appellate courts generally apply
the law in effect at the time of the appellate court’s decision, Florida East
Coast Railway Co. v. Rouse, 194 So. 2d 260, 262 (Fla. 1966), the record
must be sufficiently developed to support an alternative theory for
affirmance. See State Farm Fire and Casualty Co v. Levine, 837 So. 2d 3631 We have held in past cases that the PSA together with a mortgage loan schedule
are sufficient to prove standing, but in those cases the witness offering the
evidence appears to have been able to testify to the relationship of the various
documents and their workings, or that the documents were admitted into
evidence without objection. See, e.g., Boulous v. U.S. Bank Nat’l Ass’n., 210 So.
3d 691 (Fla. 4th DCA 2016).
3
(Fla. 2002) (ruling that the court could not affirm a decision based on an
alternative legal theory where the alternate ground had not been developed
in the record, stating “The key to applying the tipsy coachman doctrine,
permitting a reviewing court to affirm a decision from a lower tribunal that
reaches the right result for the wrong reasons, is that the record before the
trial court must support the alternative theory or principle of law.”).
Because the Bank failed to prove its standing at the filing of suit, the
court erred in entering the final judgment of foreclosure. We reverse and
remand for vacation of the final judgment and entry of an involuntary
dismissal of the complaint.
TAYLOR and LEVINE, JJ., concur.
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