Carroll & Associates, PA v. Galindo

• Decision Date: 19 November 2003
• Docket Number: No. 3D03-916, No. 3D03-1345.
• Citation: 864 So.2d 24
• Parties: CARROLL & ASSOCIATES, P.A., Appellant, v. Rafael GALINDO, etc., et al., Appellees.
• Court: Florida District Court of Appeals

864 So.2d 24

CARROLL & ASSOCIATES, P.A., Appellant, v. Rafael GALINDO, etc., et al., Appellees.

Nos. 3D03-916, 3D03-1345.

District Court of Appeal of Florida, Third District.

November 19, 2003.

Rehearing Denied January 23, 2004.

Linda L. Carroll, Miami, for appellant.

Ruden, McClosky, Smith, Schuster & Russell and John H. Pelzer and Norman S. Segall, Miami, for appellees.

Before SCHWARTZ, C.J., and GREEN, and WELLS, JJ.

ON REHEARING

WELLS, Judge.

We have for consolidated review Carroll & Associates, P.A.'s appeal from a final summary judgment of foreclosure in favor of Rafael and Nelly Galindo¹ and Carroll's motion for rehearing in Carroll's earlier appeal from an order granting summary final judgment on Carroll's cross-complaint against the Galindos. For the following reasons, we deny rehearing in Case Number 3D02-1345 regarding the summary judgment on Carroll's cross-complaint, substituting this opinion for our earlier opinion in that matter, and reverse the final summary judgment of foreclosure which is the subject of Case Number 3D03-916.

I Facts Relevant to Both Appeals

In 1995, Philip Feigenblatt acquired a fee simple interest in a condominium located in Bal Harbor, Florida. He subsequently conveyed a life estate interest in this condominium to his mother, Flora Rojas Parks, retaining the remainder interest for himself. In early 1998, Carroll obtained a $9,381 final judgment against Feigenblatt for unpaid legal fees. That judgment was recorded in the property records of Miami-Dade County on May 28, 1998.

Less than a month later, on June 17, 1998, the Galindos entered into an agreement to lease Feigenblatt's and Parks' Bal Harbor condominium until June 16, 1999 (or, if extended, until June 2000) with an option to purchase upon the Galindos' sale of another unit in the building. That agreement accorded exclusive occupancy of the Feigenblatt/Parks condominium to the Galindos in exchange for the Galindos' agreement to pay, among other things, Feigenblatt's and Parks' mortgage payments to EMC Mortgage Company. The Galindos also agreed to "satisfy the outstanding mortgage with EMC" upon closing of the sale.

The Galindos thereafter timely exercised the option to purchase the unit paying $25,000 (as required by the parties' agreement) to Feigenblatt and Parks. But before a closing could take place, Carroll acted to protect its interest in the property by foreclosing its recorded judgment lien against Feigenblatt's remainder interest. A writ of execution was issued and a notice of levy recorded against the condominium. In addition, a notice of Sheriff's sale of Feigenblatt's remainder interest in the condominium was advertised, served on Feigenblatt and provided to the Galindos. Feigenblatt and the Galindos unsuccessfully sought court intervention to cancel the public sale of Feigenblatt's remainder interest, and on February 10, 1999, with the Galindos' attorney present, the Sheriff conducted a public auction of Feigenblatt's remainder interest in the condominium. The Galindos' attorney did not bid on their behalf, and Carroll, the highest bidder, purchased Feigenblatt's remainder interest for $4,500 and received a Sheriff's deed conveying the remainder interest to it.

The Galindos continued to live in the condominium following the Sheriff's sale and made monthly mortgage payments to EMC as agreed until April 1999 when they ceased making payments.

In September 1999, Independent National Mortgage Corporation, claiming to be the holder of a note secured by a mortgage on this property, brought suit to foreclose the mortgage.² Feigenblatt, Parks, the Galindos, and Carroll were joined as defendants in the foreclosure action as having some right, title or interest in the property.

One month later, the Galindos brought a separate suit against Feigenblatt, Parks, and Sally Sawh, their prior attorney, seeking (1) title to Parks' life estate via specific performance of the Feigenblatt/Parks agreement; (2) damages against Feigenblatt and Parks for the diminished value of the condominium sale contract (due to Carroll's ownership of the remainder interest); and (3) damages against Sawh for failing to bid on Feigenblatt's remainder interest at the Sheriff's sale. In that action, the Galindos expressly elected to be bound by their agreement with Feigenblatt and Parks, and although they had failed to make monthly mortgage payments as agreed and had been joined as defendants in an action to foreclosure that mortgage, they affirmatively alleged that they had "fully performed all that was to be done on their part [under the agreement]" and stood "ready, willing and able to do any and all further things which ... may be required of them."

In the meantime, the Galindos asked the court in the mortgage foreclosure action to permit them, "as contract purchasers and tenants of the [Feigenblatt/Parks] property," to redeem the mortgage and to enter an order subrogating them to the mortgagee's rights in the foreclosure action. Carroll objected. In late February 2000, while this request was pending, the Galindos obtained the "payoff figures" for, and paid off, the loan secured by the Independent National mortgage—the loan the Galindos had obligated themselves to pay in their agreement with Feigenblatt and Parks.³ Two months later, the trial court granted the Galindos' motion for redemption effectively ordering satisfaction of the loan.

Three months later, and almost six months after the Galindos' had paid-off the loan, Independent National executed an assignment of the Feigenblatt note and mortgage to the Galindos. Based on this assignment, the Galindos obtained leave to "realign" the parties in the Independent National foreclosure suit to substitute themselves as plaintiffs. Alleging that Feigenblatt had failed to pay the note and mortgage after April 1999, an obligation that they had agreed to pay in a contract that they were seeking to enforce in another court, the Galindos sought to foreclose.

On January 17, 2002, the Galindos obtained a judgment against Parks in the suit against Feigenblatt, Parks, and Sawh, granting specific performance of the Feigenblatt/Parks agreement. Parks was ordered to deliver a warranty deed conveying her life estate interest in the condominium to the Galindos. Less than two weeks later, the Galindos moved for summary judgment on Carroll's crossclaims against them in the foreclosure action. That cross-claim sought to determine ownership and possessory rights in the condominium and to hold the Galindos liable for "unpaid" mortgage payments, assessments and expenses while they were in possession of the condominium.

Using their recently acquired judgment in the specific performance action, the Galindos argued entitlement to both possession of, and title to, a life estate in the property. They also represented that all payments were current on the condominium. Their motion for summary judgment on Carroll's cross-claim was granted with the trial court finding that: (1) Carroll succeeded to Feigenblatt's remainder interest in the condominium when it purchased that interest at the Sheriff's foreclosure sale; (2) the Galindos held a life estate interest in the condominium; and (3) the Galindos had redeemed the mortgage that was the subject of the foreclosure suit and were current on all condominium expenses. The trial court also found that as a consequence of the Galindos' actions in paying $25,000 to purchase a life estate, in redeeming the mortgage, and in paying all expenses related to the condominium, they had acquired a superior "equitable" right to title in the condominium. Consequently, Carroll's claims for declaratory judgment, to quiet title, and for damages were dismissed with prejudice, and Carroll was ordered to "execute a special warranty deed [conveying its remainder interest in the condominium] in favor of the Galindos," upon the Galindos' payment of $4,500 to Carroll. Carroll appealed from this judgment.

While that appeal was pending, the Galindos moved for and were granted a final judgment of foreclosure. Carroll has appealed the foreclosure judgment as well, and we have, on rehearing, consolidated the earlier cross-claim appeal with the foreclosure appeal.

We affirm that portion of the summary judgment on Carroll's cross-claim dismissing Carroll's request to declare the Galindos to have no legal or possessory rights in the condominium and to order them to pay damages. However, we reverse that portion of the summary judgment ordering Carroll to convey its remainder interest to the Galindos. We also reverse the foreclosure judgment and remand for dismissal of that action.

II The Summary Judgment on Carroll's Cross-Claims

Because the unrebutted record (as well as counsel's representations at oral argument) shows that the Galindos hold a life estate interest in the condominium and have redeemed or satisfied the outstanding first mortgage and assumed responsibility for, and have paid, all assessments, taxes and expenses related to the condominium, that portion of the summary...