Vargas v. Deutsche Bank Nat'l Trust Co.
| Decision Date | 08 January 2013 |
| Docket Number | No. 3D11–554.,3D11–554. |
| Parties | Rogelio VARGAS, et al., Appellants, v. DEUTSCHE BANK NATIONAL TRUST CO., et al., Appellees. |
| Court | Florida District Court of Appeals |
OPINION TEXT STARTS HERE
John Herrera, Boca Raton, for appellants.
Van Ness Law Firm, P.A., and Katherine J. Walke, Deerfield Beach, for appellees.
Before WELLS, C.J., and ROTHENBERG and LAGOA, JJ.
Rogelio Vargas appeals from an order approving a general magistrate's report and recommendation on his post-final judgment “Motion to Enforce Loan Modification Agreement Entered into in Open Court.” We affirm for three reasons: first, because the court below was without authority to entertain Vargas' multiple motions to force or enforce a loan modification agreement after a foreclosure judgment became final; second, because there is no evidence that the lender bank agreed to a modification of the underlying loan on the foreclosed property “in open court” at a post-judgment hearing; and third, because Vargas' claim that he entered into a modification of his loan agreement “in open court” is barred by the applicable statute of frauds.
On July 28, 2006, Vargas and his wife borrowed nearly a quarter of a million dollars—$232,000—from First NLC Financial Services, LLC. As a condition of receiving this substantial sum of money, Vargas and his wife executed a promissory note, agreeing to repay the loan on a monthly basis. Vargas and his wife simultaneously executed a mortgage securing repayment.1
After complying with their obligations under the note and mortgage for little more than a year, Vargas and his wife failed to make any promised payments after September 1, 2007. On December 21, 2007, Deutsche Bank brought suit to foreclose the mortgage. Mrs. Vargas failed to answer and a default was entered against her. Mr. Vargas answered and raised four affirmative defenses, none of which have been argued here.2
On March 20, 2008, Deutsche Bank's motion for summary judgment was heard. At that time, the original promissory note was surrendered to the lower court; and, based on the uncontroverted affidavits submitted by Deutsche Bank, a final judgment of foreclosure was entered. The foreclosure judgment set the public sale of the property for June 18, 2008.
At Deutsche Bank's request, the sale date was twice reset, the last setting for November 19, 2008. In the interim, Ocwen Loan Servicing, LLC (apparently the servicing agent for this loan) offered to modify the Vargases' loan, providing them with a written modification agreement, dated October 1, 2008. Importantly, the cover letter attached to the offered loan modification provided that the Vargases must accept the offer by October 24, 2008, as the offer expired on that date:
The U.S. Government has recently introduced many new programs designed to help homeowners like you who are struggling to make their monthly mortgage payments.
Ocwen is not only cooperating with the Government, we are attempting to exceed expectations....
....
You have been selected to receive a special “STREAMLINED LOAN MODIFICATION” that will lower your mortgage payment....
....
ACT NOW because this offer is part of a specialized initiative program that ends on October 24, 2008. There are other options that are part of this initiative program, but the KEY IS TO ACT NOW, because all of the options are tied to the initiative program, and it ends October 24, 2008.
What you should do.
To take advantage of this offer you must read, understand and sign the attached agreement. You must also send us the first month's payment. A loan modification changes the original terms of your mortgage, so please make sure you read and understand all the new terms.
(Emphasis added).
The unsigned agreement attached to the cover letter stated the principal balance due on the loan as modified would be $267,939.14, an amount greater than both the principal amount due on the original now defaulted loan ($230,596.06) and the total amount due under the foreclosure judgment ($248,840.88), which had been accruing interest since the lower court entered the final judgment on March 20, 2008. The modification agreement also contained a waiver and release of all claims against the lender:
LOAN MODIFICATION AGREEMENT
Ocwen Loan Servicing, LLC (“Ocwen”) is offering you this Loan Modification Agreement (“Agreement”), dated October 1, 2008 which modifies the terms of your home loan obligations as described in detail below:
....
Pursuant to our mutual agreement to modify your Note and Mortgage and in consideration of the promises, conditions, on terms set forth below, the parties agree as follows:
1. In order for the terms of this modification to become effective, you promise to make an initial down payment (“Down Payment”) of $1, 207.38 on or before October 24, 2008 and 2 equal monthly payments of principal and interest in the amount of $1,207.38 to Ocwen (“Trial Period”) beginning on December 1, 2008, and thereafter due on the 1[st] day of each succeeding month.
2. If you successfully complete the Trial Period, your loan will automatically be modified pursuant to the terms of this Agreement....
3. You agree that, at the end of the Trial Period, the new principal balance due under your modified Note and Mortgage will be $267,939.14 ....
....
10. BY EXECUTING THIS MODIFICATION, YOU FOREVER IRREVOCABLY WAIVE AND RELINQUISH ANY CLAIMS, ACTIONS OR CAUSES OF ACTION, STATUTE OF LIMITATIONS OR OTHER DEFENSES, COUNTERCLAIMS OR SETOFFS OF ANY KIND WHICH EXIST AS OF THE DATE OF THIS MODIFICTION, WHETHER KNOWN OR UNKNOWN, WHICH YOU
MAY NOW OR HEREAFTER ASSERT IN CONNECTION WITH THE MAKING, CLOSING, ADMINISTRATION, COLLECTION OR THE ENFORCEMENT BY OCWEN OF THE LAON DOCUMENTS, THIS MODIFICAITON OR ANY OTHER RELATED AGREEMENTS.
(Emphasis added).
Vargas did not accept the offer. He neither executed the agreement by October 24, 2008, nor made the initial payment required by that date. Instead, on November 5, 2008—well after the loan modification offer had expired—he filed a motion styled “Motion to Stay Foreclosure Sale and to Compel Reasonable Forbearance Agreement,” in which he acknowledged his refusal to accept the offer in its current form and requested the trial court to compel an offer that Vargas would accept:
MOTION TO STAY FORECLOSURE SALE AND TO COMPEL REASONABLE FORBEARANCE AGREEMENT
The Defendant, ROGELIO VARGAS, by and through his undersigned counsel, hereby files this Motion to Stay Foreclosure Sale and Compel Reasonable Forbearance Agreement, and in support thereof state[s] as follows:
1. An Order granting Plaintiff's Motion for Summary Final Judgment of Foreclosure was entered by this Court on March 20, 2008. According to this Order, within sixty (60) days, the bank was to provide the Defendant a Forbearance package.[ 3]
2. On October 1, 2008, more than sixty (60) days after this Court's Order, the Plaintiff provided a Loan Modification Agreement to the Defendants....
3. The aforesaid Loan Modification Agreement is unreasonable and the Defendant cannot enter into such an agreement unless modifications are made to the unreasonable terms contained therein.
4. Pursuant to paragraph 3 of the Loan Modification Agreement “the new principal balance due ... will be $267,939.14[.”]
5. Under the Final Judgment of Foreclosure, the grand total set forth in said judgment is $248,840.88. This means the loan modification is approximately $19,000.00 more than the amount set forth in the Summary Judgment Order and is unreasonable.
....
7. Pursuant to paragraph 10 [of the Loan Modification Agreement], the Defendants are waiving any and all rights and claims that may rise in connection with the mortgage or loan modification agreement, which in effect serves to release the Plaintiffs from any and all liability in the event they engage in some wrong doing concerning this matter. This is an unreasonable term for the Defendant to accept and agree.
....
WHEREFORE, the Defendant, ROGELIO VARGAS, respectfully requests that his Honorable Court enter an Order Staying the Foreclosure sale that is currently set for November 19, 2008 and compel the parties herein to negotiate a loan modification agreement that is acceptable to both parties within thirty (30) days of this Order....
(Emphasis added).
The foreclosure sale was reset for February 12, 2009. On January 14, 2009, Vargas filed a second post-judgment motion, styled “Second Motion to Stay Foreclosure Sale and to Compel Reasonable Forbearance Agreement.” In that motion, he again acknowledged his refusal to accept the now-expired loan modification offer and again asked the trial court to compel Deutsche Bank to offer him a better deal. This motion, using identical language, lodged the same objections that his first post-judgment motion had raised about the terms of the October 1, 2008 offer to modify his loan. The motion additionally claimed that Vargas' counsel had “diligently attempted to obtain a reasonable forbearance agreement but to no avail.” As of the filing of this motion, Vargas had made no payments to Deutsche Bank for at least sixteen months; the mortgage on his home already had been foreclosed for almost a year; and, he concededly had been unable to reach an agreement with the bank to modify his loan.
On January 29, 2009, Vargas' second motion to postpone the February 12th public sale and to compel what he deemed a “reasonable” settlement was heard. The lower court summarily denied the motion, ordering the public sale to proceed as scheduled on February 12. Eleven days later, just three days before the scheduled sale, Vargas filed an unverified “Emergency Motion to Postpone Sale” in which he represented that at the January 29th hearing on the second motion to postpone sale, the “Parties' respective counsels [a]greed in open Court to the terms of the Loan Modification Agreement, offered to the Defendant's [sic] on October 1, 2008,” with the only pending issue being “whether to apply...
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