Ramphal v. TD Bank National Ass'n

IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FIFTH DISTRICT
NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
MONTIELAL RAMPHAL, BALDWIN
OFFICE PARK, LLC, and FROILAN
BARINAS,
Appellants,
v. Case Nos. 5D16-725
and 5D16-726
TD BANK NATIONAL ASSOCIATION,
A NATIONAL BANKING ASSOCIATION,
AS SUCCESSOR-IN-INTEREST TO
AMERICANFIRST BANK BY ASSET
ACQUISITION FROM THE FEDERAL
DEPOSIT INSURANCE CORPORATION,
AS RECEIVER FOR AMERICANFIRST BANK,
Appellee.
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Opinion filed December 22, 2016
Appeal from the Circuit Court
for Orange County,
Alice Blackwell, Judge.
Gus R. Benitez, of Benitez Law Group, P.L.,
Orlando, and Nick Asma, of Asma & Asma,
P.A., Winter Garden, for Appellants.
Maureen A. Pateman, Kristie Hatcher-Bolin
and John M. Brennan, Jr., of
GrayRobinson, P.A., Orlando, for Appellee.
LAMBERT, J.
In these consolidated appeals, Montielal Ramphal, Baldwin Office Park, LLC, and
Froilan Barinas (collectively “Appellants”) challenge the final deficiency judgment entered
in favor of TD Bank (“Appellee”). Because we find that the trial court erred in concluding
that it was constrained to select either the opinion of one party’s expert witness or the
conflicting opinion of the other party’s expert witness when determining the fair market
value of the foreclosed property, we reverse.
Following the entry of an amended consent final judgment of foreclosure in its favor
in the amount of $1,635,689.18, Appellee purchased the mortgaged property at the
foreclosure sale for a nominal sum. Appellee then filed a motion for a final deficiency
judgment, asserting that the property’s fair market value as of the foreclosure sale date
was less than the amount of the indebtedness determined in the amended final judgment
of foreclosure. See Morgan v. Kelly, 642 So. 2d 1117, 1117 (Fla. 3d DCA 1994)
(explaining that “the correct formula to calculate a deficiency judgment is the total debt,
as secured by the final judgment of foreclosure, minus the fair market value of the
property, as determined by the court” (citations omitted)); Symon v. Charleston Capital
Corp., 242 So. 2d 765, 768 (Fla. 4th DCA 1970) (holding that the date of the foreclosure
sale is the date at which the fair market value is determined).
At the evidentiary hearing on the motion, Appellee presented testimony from its
expert witness that the fair market value of the property at the time of the sale was
$890,000. In response, Appellants’ expert testified that the property’s value at that time
was $1.63 million dollars. Faced with conflicting expert opinions, the trial court, as the
finder of fact in this case, was free to determine the reliability and credibility of these
competing opinions and to weigh them as the court saw fit. Dep’t of Agric. & Consumer
Servs. v. Bogorff, 35 So. 3d 84, 88 (Fla. 4th DCA 2010) (citing Easkold v. Rhodes, 614
So. 2d 495, 498 (Fla. 1993) (additional citation omitted)).
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After closing arguments, the court began doing just that. First, it questioned
whether Appellee’s expert had failed to properly account for the complete square footage
of the property and had used an improper capitalization rate in formulating his opinion,
thus causing the expert’s opinion of value to be too low. Conversely, the court viewed
the comparable sales utilized by Appellants’ expert in reaching his opinion as being not
sufficiently comparable to the foreclosed property, leading the court to believe that
Appellant’s expert had valued the property too high. The court then questioned what
discretion it had under these circumstances in determining fair market value. It indicated
that, in its view, present “case law” dictated that it must now choose one of the two fair
market values submitted by the experts as being the fair market value of the property.
The court expressed the following frustration with this restriction:
[T]here’s an injustice done. There’s an injustice done if the
court picks [Appellee’s expert] because the [Appellants] are
going to pay, by way of a deficiency, more than they ought to.
If I pick [Appellants’ expert], I think that there’s—there is an
injustice done, because . . . there is an inflated value attached
to that appraisal that does away with any deficiency, which I
don’t think is what’s right either.
In the written final judgment, the court reiterated that it believed that it had no
discretion to determine the value of the subject real property “outside the parameters of
the appraisers” and, thus, was limited to choosing between either Appellants’ expert or
Appellee’s expert. It determined the fair market value of the property to be that opined
by Appellee’s expert and entered deficiency judgment accordingly because “[Appellee’s
expert] came closer to getting it right than [Appellants’] expert.”
On appeal, Appellants argue that the court erred in concluding that it had no
discretion other than to pick one of the two expert opinions in determining the fair market
value of the property. Under the circumstances of this case, we agree.
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We first observe that “[a] trial court’s property valuation must be supported by
competent, substantial evidence.” Tucker v. Tucker, 171 So. 3d 158, 159 (Fla. 4th DCA
2015) (quoting Garcia v. Garcia, 25 So. 3d 687, 689 (Fla. 4th DCA 2010)). Moreover, a
trial court is precluded from simply “splitting the difference” between the two evaluations
of the experts, without providing factual findings or an explanation for its value, because
under such circumstances the valuation would not have been supported by competent
substantial evidence. Blossman v. Blossman, 92 So. 3d 878, 878–79 (Fla. 1st DCA 2012)
(citing Spillert v. Spillert, 564 So. 2d 1146 (Fla. 1st DCA 1990)).
In the present case, the trial court was apparently convinced that if it determined a
fair market value somewhere between the values opined by the experts, it would be
improperly “splitting the difference.” While we appreciate the trial court’s concern, we
nevertheless hold that a trial court is not limited to simply selecting the opinion of one
qualified expert over the other in determining the fair market value of property, and we
conclude that it has the discretion to find a different value than that provided by either
expert, if the trial court provides an articulable, factual basis for doing so that is supported
by competent substantial evidence contained in the record. See Peoples Fed. Sav. &
Loan Ass’n of Tarentum, Pa. v. Shoreline Garden Townhomes, II, Ltd., 538 So. 2d 864
(Fla. 1st DCA 1988) (finding that for purposes of computing a deficiency judgment, there
was no abuse of discretion in finding that the fair market value of foreclosed property lay
between the valuations of the two appraisers, based upon the evidence contained in the
record).
Accordingly, because it is clear that the trial court would have attributed a different
fair market value to the property if it believed that it had the discretion and authority to do
so, we reverse the final deficiency judgment and remand for further consideration by the
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court consistent with this opinion. The court may take additional evidence as it deems
necessary.
REVERSED and REMANDED.
PALMER and TORPY, JJ., concur.
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