Bank of America, N.A. v. Nash

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
BANK OF AMERICA, N.A., ETC.,
Appellant,
v. Case No. 5D14-4511
LINDA A. NASH, ET AL.,
Appellees.
________________________________/
Opinion filed May 6, 2016
Appeal from the Circuit Court
for Seminole County,
Robert J. Pleus, Jr., Senior Judge.
Mary J. Walter, of Liebler Gonzalez
& Portuondo, Miami, for Appellant.
John G. Pierce, of Pierce & Associates,
PLC, Orlando, for Appellee, Linda A. Nash.
Shawn Timothy Newman, Olympia, Pro
Hac Vice, for Appellee, Homeowners
SuperPAC.
PER CURIAM.
Bank of America, N.A. (“Bank”), as successor by merger to BAC Home Loans
Servicing, LP f/k/a Countrywide Home Loans Servicing, LP, appeals the trial court’s final
judgment denying its foreclosure action against Linda A. Nash, invalidating the note and
mortgage, ordering a refund of all mortgage payments, and awarding attorney’s fees to
Nash. We reverse.
In 2005, Nash executed a promissory note secured by a mortgage in favor of
America’s Wholesale Lender (“AWL”). Countrywide Home Loans, Inc., “a New York
Corporation Doing Business as America’s Wholesale Lender,” subsequently indorsed
the note in blank, and MERS, as nominee for AWL, assigned the mortgage to BAC
Home Loans Servicing, LP, formerly known as Countrywide Home Loan Servicing, LP
(“BAC”). In 2010, BAC sent a notice of default to Nash. When Nash failed to cure the
default, Bank, successor by merger to BAC, filed a mortgage foreclosure complaint
against her, alleging that all conditions precedent had been performed. Copies of the
original mortgage and note, acceleration notice, and assignment of mortgage were
attached to the complaint. Nash filed an answer and affirmative defenses, alleging that
Bank did not have standing to foreclose and that the note and mortgage were invalid
because both documents and the indorsement delineated AWL as both a corporation
and a fictitious name.
Following a trial, the trial court entered a final judgment in favor of Nash, finding
that Bank did not have standing to bring the action and that the note and mortgage were
void because AWL was not incorporated when the loan was made, was not a licensed
mortgage lender in Florida, and did not have authority to do business in Florida. The
trial court then ordered Bank to repay to Nash all sums that she had paid on the note
and mortgage as well as her attorney’s fees.
“A crucial element in any mortgage foreclosure proceeding is that the party
seeking foreclosure must demonstrate that it has standing to foreclose.” McLean v. JP
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Morgan Chase Bank Nat’l Ass’n, 79 So. 3d 170, 173 (Fla. 4th DCA 2012) (finding that,
to establish standing, plaintiff must show it held or owned note at time complaint was
filed). Under section 673.3011, Florida Statutes (2011), a person entitled to enforce the
note and foreclose on a mortgage is the holder of the note, a non-holder in possession
of the note who has the rights of a holder, or a person not in possession of the note who
is entitled to enforce under section 673.3091, Florida Statutes. Thus, “[t]he party that
holds the note and mortgage in question has standing to bring and maintain a
foreclosure action.” Deutsche Bank Nat’l Tr. Co. v. Lippi, 78 So. 3d 81, 84 (Fla. 5th DCA
2012). If the note does not name the plaintiff as the payee, the note must bear a special
indorsement in favor of the plaintiff or a blank indorsement. See Riggs v. Aurora Loan
Servs., LLC, 36 So. 3d 932, 933 (Fla. 4th DCA 2010).
“A trial court's decision as to whether a party has satisfied the standing
requirement is reviewed de novo.” Sosa v. Safeway Premium Fin. Co., 73 So. 3d 91,
116 (Fla. 2011). We conclude that the trial court erred in finding that Bank did not have
standing to bring this action. According to the unrebutted testimony from Chad
Anderson, a mortgage resolution associate with Bank who was familiar with the subject
loan and its records, Bank, or entities that merged into Bank, had always serviced the
loan. He identified AWL as the original lender and Countrywide as the original loan
servicer. He testified that AWL was “a business entity or a business name under
Countrywide” and that Countrywide, a New York corporation, was doing business as
AWL. Mr. Anderson testified that Countrywide serviced the loan from commencement
until April 27, 2009, when its name changed to BAC. In July 2011, BAC merged into
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Bank. Thus, the evidence shows that the loan was never transferred, and Bank, as a
result of the merger with BAC, had standing to foreclose.
In its final judgment, the trial court also found that AWL was not licensed or
authorized to do business in Florida. This was not raised as an affirmative defense, and
no record evidence establishes that AWL or Countrywide was not licensed as a
mortgage lender in 2005. Even if AWL was required to obtain a license and did not do
so, disciplinary measures for such a violation would include, among others, a fine or
reprimand.1 §§ 494.0025, 494.0072, Fla. Stat. (2005). The failure to comply with the
licensing requirement would “not affect the validity or enforceability of any mortgage
loan . . . .” § 494.0022, Fla. Stat. (2005). Likewise, while section 607.1501(1), Florida
Statutes (2005), prohibits a foreign corporation from transacting business in Florida until
it obtains a certificate of authority from the Department of State, activities including
1While it is unlawful for any person to act as a mortgage lender in Florida without
a current active license, see section 494.0025(1), Florida Statutes (2005), there are
exceptions for
(a) A bank, bank holding company, trust company, savings
and loan association, savings bank, credit union, or
insurance company if the insurance company is duly
licensed in this state.
(b) Any person acting in a fiduciary capacity conferred by
authority of any court.
(c) A wholly owned bank holding company subsidiary or a
wholly owned savings and loan association holding company
subsidiary that is approved or certified by the Department of
Housing and Urban Development, the Veterans
Administration, the Government National Mortgage
Association, the Federal National Mortgage Association, or
the Federal Home Loan Mortgage Corporation.
§ 494.006(1)(a)-(c), Fla. Stat. (2005).
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“[c]reating or acquiring indebtedness, mortgages, and security interests in real or
personal property” or “[s]ecuring or collecting debts or enforcing mortgages and security
interests in property securing the debts” do not constitute transacting business. §
607.1501(2)(g), (h), Fla. Stat. (2005). Thus, even assuming AWL/Countrywide was a
foreign corporation, it did not need to obtain a certificate of authority in order to create or
enforce a mortgage or note.
The only remaining issue concerns Nash’s claim that AWL was a fictitious name
for Countrywide, if Countrywide failed to register that name. A person may not engage
in business under a fictitious name unless the name is registered with the Division of
Corporations of the Department of State. § 865.09(3), Fla. Stat. (2005). If a business
fails to comply, it and any successors or assigns may not maintain any action, suit, or
proceeding in any court. Id. § 865.09(9)(a). Here, there is no evidence to suggest that
Countrywide failed to register AWL as a fictitious name, but, even so, such a failure to
register “does not impair the validity of any contract, deed, mortgage, security interest,
lien, or act of such business and does not prevent such business from defending any
action, suit, or proceeding in any court of this state.” Id. § 865.09(9)(b).
The trial court also found that a condition precedent of the foreclosure had not
been met because there was no receipt of the default letter. However, the failure to
perform a condition precedent was not raised in Nash’s affirmative defenses. As a
result, the defense is waived. Fla. R. Civ. P. 1.140(h). Even had it been properly
raised, it was meritless.
According to Mr. Anderson, the default letter was mailed to Nash at her
designated mailing address. The trial court’s conclusion that Bank was required to
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establish proof of delivery in order to establish that it met all required conditions
precedent to foreclosure was misplaced. Here, the note states that
[u]nless applicable law requires a different method, any
notice that must be given to me under this Note will be given
by delivering it or by mailing it by first class mail to me at the
Property Address above or at a different address if I give the
Note Holder a notice of my different address.
Thus, under the note, notices may be mailed to the property address or to a different
address, if designated. Bank did so. The fact that the letter may not have been
received is irrelevant.
Bank also argues that the trial court erred by granting relief beyond Nash’s
pleadings, specifically, by invalidating the note and mortgage and ordering Bank to
return all prior mortgage payments when Nash never requested this relief. “A trial court
is without jurisdiction to award relief that was not requested in the pleadings or tried by
consent.” Wachovia Mortg. Corp. v. Posti, 166 So. 3d 944, 945 (Fla. 4th DCA 2015).
Therefore, “a judgment which grants relief wholly outside the pleadings is void.” Bank of
N.Y. Mellon v. Reyes, 126 So. 3d 304, 309 (Fla. 3d DCA 2013); see Mullne v. Sea-Tech
Constr. Inc., 84 So. 3d 1247, 1249 (Fla. 4th DCA 2012). Further, granting relief, which
was neither requested by appropriate pleadings, nor tried by consent, is a violation of
due process. Posti, 166 So. 3d at 945-46. Pleadings sufficient to invoke a court’s
jurisdiction, according to the rules of civil procedure, include a complaint, petition,
counterclaim, crossclaim, and a third-party complaint. Fla. R. Civ. P. 1.100(a).
We agree that the trial court erred by granting relief that was outside the scope of
the pleadings. Nash alleged in her answer and affirmative defenses that the note and
mortgage were invalid, but no request for repayment was pled.
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For these reasons, we reverse the judgment in favor of Nash and remand for
entry of judgment in favor of Bank. We also reverse the award of attorney’s fees in
favor of Nash.
REVERSED and REMANDED.
ORFINGER, BERGER and EDWARDS, JJ., concur.
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