Professional Documents
Culture Documents
Petitioners/Appellees,
v.
Respondent/Appellant.
Page
TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii
STATEMENT OF THE CASE AND FACTS . . . . . . . . . . . . . . . . . . . . . . 1
SUMMARY OF ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
I. THE DECISION OF THE FIFTH DISTRICT THAT OWNERSHIP
OF A NOTE AND MORTGAGE BY THE PLAINTIFF IS NOT
NECESSARY IN AN ACTION TO FORECLOSE A MORTGAGE
ON REAL PROPERTY EXPRESSLY AND DIRECTLY
CONFLICTS WITH NUMEROUS FLORIDA SUPREME COURT
DECISIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
II. THE DECISION OF THE FIFTH DISTRICT ALSO EXPRESSLY
AND DIRECTLY CONFLICTS WITH NUMEROUS DECISIONS
FROM THE OTHER DISTRICT COURTS OF APPEAL, ALL OF
WHICH REQUIRE PROOF OF OWNERSHIP OF THE NOTE
AND MORTGAGE TO FORECLOSE.. . . . . . . . . . . . . . . . . . . . . . . . 9
CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
i
TABLE OF AUTHORITIES
CASES
Carapezza v. Pate,
Chestnut v. Robinson,
Johns v. Gillian,
Jordan v. Sayre,
Lizio v. McCullom,
ii
Miller v. Ellenwood,
Mills v. Hamilton,
Rubin v. Kapell,
Smith v. Kleiser,
Stewart v. Gaines,
Stone v. Bankunited,
iii
2013 Fla. App. LEXIS 16877 (Fla. 3d DCA October 23, 2013) . . . . . . . . . .8
Secondary Authorities
_Materials/PEBUCC/ PEB_Report_111411.pdf . . . . . . . . . . . . . . . . . . . . . . . . . . .7
iv
Wells Fargo Bank, N.A. (“Appellant”), sued Daniel and Sharon Morcom
(Op.1 at 1). The Appellant failed to allege that it was “the owner and holder of the
note and mortgage” as a basis for seeking foreclosure. Instead, the Appellant merely
alleged that it was “now entitled to enforce Mortgage and Mortgage Note pursuant to
(Op. at 1). Additionally, the Appellant also failed to allege that it was proceeding in
a representative capacity for the owner of the note and mortgage. (Op. at 2). During
discovery, the Appellant in response to a request for admission, admitted that it was,
in fact, not the owner of the note and mortgage. (Op. at 2).
On August 9, 2011, Appellees filed a motion for summary judgment in the trial
court, arguing Appellant was not the owner of the note and mortgage. (Op. at 2).
Relying on the same cases cited in this jurisdictional brief, the trial court granted the
foreclosure case requires evidence that the plaintiff is the owner of the note and
mortgage, even though the plaintiff has the right to enforce the note pursuant to the
1
The opinion of the Fifth District is abbreviated as “Op.”
1
Appellants appealed to the Fifth District Court of Appeal, which reversed the
trial court on the basis that, pursuant to Florida’s Uniform Commercial Code
(“UCC”), all that is necessary in order to foreclose a mortgage on real property is that
the plaintiff be entitled to enforce the promissory note which the mortgage secures.
(Op. at 3-4). In so deciding, the Fifth District unjustifiably, and admittedly, rejected
Florida Supreme Court precedent (cited in this jurisdictional brief) requiring that a
plaintiff “must both hold and own the note and mortgage to satisfy the standing
The decision of the Fifth District expressly and directly conflicts with
numerous cases decided by the Florida Supreme Court and by other District Courts
of Appeal, all of which hold that a plaintiff must own the note and mortgage, as well
as hold the note and mortgage, in order to proceed with an action to foreclose a
mortgage on real property. The Fifth District’s flawed attempt to distinguish the
Florida Supreme Court cases based on Florida’s passage of the UCC nearly 50 years
ago – the very first Florida appellate court to ever attempt such a distinction – does not
diminish the express-and-direct conflict created by its decision. Instead, with nearly
50 years having passed since the UCC’s adoption, the fact that the Fifth District seeks
to now rely on the UCC as a basis to sweep away long standing precedent of the
Florida Supreme Court cries out for the Florida Supreme Court to accept discretionary
jurisdiction over this appeal pursuant to Article V, Section 3(b)(3), of the Florida
conflicts with decisions from each of the other four District Courts of Appeal which
have each held that proof of owning, as well as holding, the note and mortgage is
required for a plaintiff to pursue a mortgage foreclosure action. This conflict serves
as an alternate basis for the Florida Supreme Court to exercise jurisdiction in this case.
ARGUMENT
The Fifth District rejected the trial court’s view which held that Florida
Supreme Court precedent requires that a plaintiff in a foreclosure action own, as well
as hold, the note and mortgage, unless the plaintiff is proceeding in a representative
capacity. The Fifth District’s decision holding that ownership of the note and
conflicts with Smith v. Kleiser, 107 So. 262 (Fla. 1926), and Edason v. Central
Farmers' Trust Co., 129 So. 698, 699 (Fla. 1930), which require that a foreclosure
action be brought in the name of the owner of the note and mortgage.2 Accordingly,
the Florida Supreme Court has jurisdiction to entertain this appeal pursuant to Article
The Florida Supreme Court in Smith v. Kleiser, 107 So. 262 (Fla. 1926),
2
The Fifth District’s decision also conflicts with numerous other decisions of
the Florida Supreme Court which clearly indicate that the Florida Supreme Court has
consistently required that ownership of the note and mortgage be pled and proved in
real property foreclosure actions, and that Smith and Edason are not anomalous cases
that should be disregarded. These cases include: Strickland v. Gainesville Nat’l Bank,
77 So. 615, 615-16 (Fla. 1918)(“It is also alleged that the note sued on, which is made
payable to the complainant, is a renewal of the original note. This we think is
sufficient allegation of ownership by the complainant of the indebtedness and the
mortgage . . . .”); Chestnut v. Robinson, 95 So. 428 (Fla. 1923)(“The ownership of
the notes was thus made an issue which was incumbent upon the complainant to
establish.”); Hotel Management Co. v. Krickl, 158 So. 118, 120 (Fla. 1934)(holding
that ownership of a note is adequately alleged by stating that the plaintiff is the owner
of the note and that plaintiff received the note endorsed to her); Mills v. Hamilton,
163 So. 857, 858-859 (Fla. 1935)(reviewing final decree granting a foreclosure in a
proceeding that had been brought by the executor of the estate of the mortgagee
holding that personal representative was the owner and holder of the mortgage,
thereby requiring ownership of the note to foreclose); Johns v. Gillian, 184 So. 140,
144 (Fla. 1938)(holding Gillian was “equitable owner of the mortgage and [that]
entitle[d] him to foreclose the same,” thereby requiring ownership of the note (i.e.
debt) and mortgage were required for the plaintiff to be entitled to foreclose in equity);
Lakeland Production Credit Ass’n v. Coachman, 5 So. 2d 49 (Fla. 1941)(affirming
denial of a motion to dismiss a complaint to foreclose, where defendant claimed that
the bill contained allegations that tended to contradict allegations of ownership,
holding that “[i]n view of the allegations of ownership of the note and mortgage . . .
we conclude that the same are legally sufficient under which to receive testimony of
the ownership by the plaintiff of the note and mortgage. An issue can be formed by
denial thereof in an answer and testimony adduced by the respective parties.”).
4
recognized the obligation of the party bringing a foreclosure action to prove that it was
the owner of the note. As explained in Smith: “If suit to foreclose a mortgage which
has been assigned is by bill in equity it should be in the name of the real owner of
the debt secured.” Smith, 107 So. at 263-64 (Fla. 1926)(emphasis added)(citations
omitted).
Similarly, the Florida Supreme Court in Edason v. Central Farmers' Trust Co.,
129 So. 698, 699 (Fla. 1930), underscored the holding in Smith, requiring that the
owner of the note bring the action to foreclose, explaining: “A Bill to for[e]close a
mortgage should show that it is brought in the name of the owner of the debt secured
by the mortgage. Smith v. Kleiser, 91 Fla. 84, 107 So. R. 262; Chestnut v. Robinson,
85 Fla. 87, 95 So. R. 428; Armstrong & Donahue, Florida Chancery Jurisprudence,
In the instant case, the Appellee responded in the trial court to a request for
admission, admitting that it did not own the note and mortgage. Applying Florida
Supreme Court precedent, including Smith and Edason, the trial court held that the
plaintiff, who was not moving forward in a representative capacity, could not proceed
as it was not the owner of the note and mortgage, although it was the holder. The
Fifth District’s decision reversing the trial court expressly rejected Florida Supreme
(Op. at 6).3
The fact that the District Court sought to distinguish the controlling Florida
Supreme Court precedent, including Smith and Edason, on the basis of the 1967
passage of the UCC, does not detract from the existence of express-and-direct conflict.
See DK Arena, Inc. v. EB Acquisitions I, LLC, 112 So.3d 85, 96-97 (Fla.
Tanenbaum v. Biscayne Osteopathic Hosp., Inc., 173 So. 2d 492, 495 (Fla. 3d DCA
1965), on the basis that the case being reviewed did not involve “an attempt to set up
3
The Appellees also cited the following cases to the Fifth District (in addition
to Smith, Edason, and those cases cited in footnote 2) but these cases were only cited
as examples of the Florida Supreme Court’s use of the term “owner and holder of the
note and mortgage” (or, “holder and owner of the note and mortgage”): Jordan v.
Sayre, 10 So. 823 (1892); Miami Real Estate Co. v. Baxter, 124 So. 452, 452-453
(Fla. 1929); Stewart v. Gaines, 137 So. 794, 795-796 (Fla. 1931); Byrd v. South
Florida Mortg. Co., 143 So. 124, 125 (Fla. 1932); Pritchett v. New York Life
Insurance Company, 170 So. 700 (1936); Rubin v. Kapell, 105 So. 2d 28 (1958);
Stokes v. Home Owners Loan Corporation, 189 So. 657 (1939); Miller v. Ellenwood,
164 So. 140 (1935). Jordan is evidently the basis for the reference to the late 1800s.
6
City of Orlando, 997 So.2d 1089, 1094 (Fla. 2008)(finding express-and-direct conflict
where the district court erroneously sought to distinguish multiple decisions from
other district courts of appeal relating to the authority of judge of compensation claim
Moreover, the very fact that the Fifth District expressly rejected – now, for the very
first time – an entire line of Florida Supreme Court cases relating to mortgage
foreclosure on the basis of a nearly 50 year old uniform act, whose own Permanent
“both substance and procedure,”4 cries out for the Supreme Court to exercise its
intended to sweep away in one stroke of the legislative broom the jurisprudence of the
4
See REPORT OF THE PERMANENT EDITORIAL BOARD FOR THE UNIFORM
COMMERCIAL CODE, APPLICATION OF THE UNIFORM COMMERCIAL CODE TO SELECTED
ISSUES RELATING TO MORTGAGE, at 1-2 (American Law Institute and the National
Conference of Commissioners on Uniform State Laws 2011), available at
http://www.uniformlaws.org/Shared/Committees_Materials/PEBUCC/PEB_Report
_111411.pdf (“The UCC, of course, does not resolve all issues in this field. Most
particularly, as to both substance and procedure, the enforcement of real estate
mortgages by foreclosure is primarily the province of a state’s real property law
(although determinations made pursuant to the UCC are typically relevant under that
law).”); see also Restatement (Third) of Mortgages, Commentary to Section 8.5:
“Enforceability of the original note and of the mortgage are governed by different
bodies of law; the obligation’s enforcement is governed by the Uniform Commercial
Code and by contracts law, while mortgage enforcement is governed by a specialized
body of property law.” (Emphasis added).
7
Florida Supreme Court” related to mortgage foreclosure. See e.g., West v. Caterpillar
Tractor Co., 336 So. 2d 80 (Fla. 1976)(expressly approving the decision in Ford
Motor Co. v. Pittman, 227 So.2d 246, 249 (Fla. 1st DCA 1969), to avoid finding that
the enactment of the UCC swept “away in one stroke of the legislative broom the
“unless the legislature has in unequivocal terms spelled out to the courts of this State
that it has by the enactment of the omnibus Uniform Commercial Code severed the
implied warranty doctrine from the jurisprudence of this State, we will not be the
cases was unheard of before 2006, when the conflating5 of an action to enforce a
promissory note at law and an action to foreclose a mortgage in equity was first
achieved in Philogene v. ABN Amro Mortg. Group, Inc., 948 So. 2d 45, 46 (Fla.
4th DCA 2006), which has spawned an entire new body of law to which the Fifth
Accordingly, because the Fifth District’s decision that ownership of the note
5
See, e.g., Vives v. Wells Fargo Bank, N.A., 2013 Fla. App. LEXIS 16877, at
*3-4 (Fla. 3d DCA October 23, 2013)(Judge Shepard, concurring)(noting the
“conflating” of these action and relying on Royal Palm Corp. Ctr. Ass’n v. PNC Bank,
NA, 89 So. 3d 923, 931(Fla. 4th DCA 2012), for the proposition that “foreclosure of
a mortgage and suit on a promissory note are separate and distinct remedies available
to a lender-mortgagee upon default”).
8
of the UCC nearly 50 years ago, expressly and directly conflicts with the Florida
Supreme’s Court decision in Smith, Edason, and the cases cited in footnote 2, all of
which found that ownership of the note and mortgage is required to pursue a
foreclosure action, this Court should exercise its discretionary jurisdiction pursuant
The Fifth District’s decision that ownership of the note and mortgage is
decisions from each of the other Districts, each of which has held that a plaintiff in an
action to foreclose a mortgage must present evidence that its owns (as well as holds),
the note and mortgage. These cases include: (1) Mazine v. M&I Bank, 67 So. 3d
1129, 1131 (Fla. 1st DCA 2011)(“The party seeking foreclosure must present
evidence that it owns and holds the note and mortgage to establish standing to proceed
with a foreclosure action.”); (2) Stone v. Bankunited, 115 So. 3d 411, 413 (Fla. 2d
DCA 2013)(“The party seeking foreclosure must present evidence that it owns and
holds the note and mortgage to establish standing to proceed with a foreclosure
action.”); (3) Carapezza v. Pate, 143 So. 2d 346, 347 (Fla. 3d DCA 1962)(“Ownership
having been put in issue by the answer it followed that ownership of the note and
mortgage became one of the issues in the case and was a material fact to be proved by
the plaintiff.”); (4) Your Construction Center, Inc. v. Gross, 316 So. 2d 596 (Fla. 4th
DCA 1975)(“[W]hen plaintiff files his complaint, he must necessarily allege he is the
owner and holder of the note and mortgage in question.”), certiorari denied, Your
Constr. Center, Inc. v. Gross, 333 So. 2d 466 (Fla. 1976); and (5) Lizio v. McCullom,
36 So. 3d 927, 929 (Fla. 4th DCA 2010)(“The party seeking foreclosure must present
evidence that it owns and holds the note and mortgage in question in order to proceed
this matter due to express and direct conflict with decisions of the First, Second,
Third and Fourth District Courts of Appeal – most of which were decided after the
CONCLUSION
Based upon the foregoing, Petitioners assert there is ample cause for this
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RRESPECTFULLY SUBMITTED,
COMBS GREENE, P.A.
Steven P. Combs
Florida Bar Number 979449
Deborah L. Greene
Florida Bar Number 933716
Robert S. Jeffrey
Florida Bar Number 84362
3217 Atlantic Boulevard
Jacksonville, Florida 32207
Telephone: (904) 359-5505
Facsimile: (904) 359-5506
Email: spcombs@flalawyers.pro
CERTIFICATE OF SERVICE
I hereby certify that on this 30th day of December, 2013, a true and correct
copy of the foregoing was delivered to Dean Morande, Esquire, Michael K. Winston,
Esquire, and Donna L. Eng, Esquire, 525 Okeechobee Boulevard, Suite 1200, West
Palm Beach, Florida 33401, at the following e-mail addresses designated for service
in this matter: dmorande@carltonfields.com (primary), deng@carltonfields.com
(Primary); kcasazza@carltonfields.com (secondary), cramsay@carltonfields.com
(Secondary); wpbecf@cfdom.net (secondary).
Steven P. Combs
Florida Bar Number 979449
11