Credo LLC v. Speyside Invs. Corp., 3D17-0815

• Decision Date: 15 August 2018
• Docket Number: No. 3D17-0815,3D17-0815
• Citation: 259 So.3d 893
• Parties: CREDO LLC, Appellant, v. SPEYSIDE INVESTMENTS CORPORATION, Appellee.
• Court: Florida District Court of Appeals

259 So.3d 893

CREDO LLC, Appellant,

v.SPEYSIDE INVESTMENTS CORPORATION, Appellee.

No. 3D17-0815

District Court of Appeal of Florida, Third District.

Opinion filed August 15, 2018

Law Offices of Paul Morris, P.A., and Paul Morris ; Roniel Rodriguez, IV, for appellant.

Rothman and Tobin, P.A., Michael Rothman, and Ellen Patterson, for appellee.

Before LOGUE, LUCK and LINDSEY, JJ.

LINDSEY, J.

A seller of real property appeals an order requiring $3.3 million paid by a buyer at the closing on a sale of real property, intended to satisfy a preexisting mortgage, to be deposited into the court registry pending litigation by the mortgage holder, initiated after the closing, over the payoff amount. We affirm for the reasons set forth below.

I. BACKGROUND

This case began in August of 2006, when Sally Sawh executed a promissory note in favor of Fairmont Funding, LTD, predecessor-in-interest to Wells Fargo Bank, N.A. ("Wells Fargo") in the original principal amount of $3,000,000.00. As security for the note, Ms. Sawh and Paolo Dellacassa executed a mortgage on a parcel of real property located at 4575 Sabal Palm Road in Miami, Florida (the "Property"). It is this property that is the subject of yet a second appeal to this Court.

In August of 2012, appellant seller, Credo, LLC ("Credo") obtained a Sheriff's Deed to the Property in exchange for the payment of $10.00 (ten dollars). In October of 2013, Wells Fargo, the plaintiff below, filed the instant action seeking to foreclose on the mortgage and/or enforce the note naming Ms. Sawh, Mr. Dellacassa and Credo, among others, as defendants herein. While the foreclosure was pending, Credo contracted to sell the Property to appellee buyer, Speyside Investments Corp. ("Speyside").

On February 26, 2014, just prior to the closing, Credo filed a motion to redeem the mortgage purportedly pursuant to section 45.0315, Florida Statutes, and set it for hearing on a five minute motion calendar on March 10, 2014. The trial court entered an order granting the motion to redeem ("the March 10 Redemption Order") and authorizing Credo to tender to Wells Fargo, on or before May 1, 2014, the total sum of $3,347,233.21 ("$3.3 million"). In exchange, the trial court directed that "[u]pon redemption, this Order shall constitute a satisfaction of said mortgage, extinguishing the mortgage of record."

With the March 10 Redemption Order in hand, Credo sold the Property to Speyside on April 30, 2014, for the sum of $6,150,000.00 ("$6.15 million"), some of which Speyside borrowed and some of which Speyside paid out-of-pocket. At closing, the $3.3 million identified in the March 10 Redemption Order was disbursed to Wells Fargo. Credo pocketed the net sum of $1,815,336.89 ("$1.8 million") as part of this transaction. A Warranty Deed from Credo in favor of Speyside was recorded on May 6, 2014.

While Wells Fargo accepted the $3.3 million Speyside tendered at the closing to pay off the mortgage, it did not release its lien or otherwise recognize and comply with the March 10 Redemption Order. Instead, three weeks later, while still in possession of the $3.3 million, Wells Fargo moved the trial court for reconsideration or, alternatively, to vacate the March 10 Redemption Order. Wells Fargo claimed that the amount was unliquidated and that the trial court should have held an evidentiary hearing before fixing the amount necessary to redeem the mortgage. The motion was accompanied by an affidavit from Wells Fargo alleging that the correct redemption amount was $4,624,169.03 ("$4.6 million"), or $1,276,935.82 ("$1.276 million") more than the amount that had been fixed by the trial court. The trial court denied the motion and entered an order dismissing the action below. Wells Fargo appealed both orders to this Court, which were consolidated in Wells Fargo Bank, N.A. v. Sawh (Credo I), 194 So.3d 475 (Fla. 3d DCA 2016).

In Credo I, this Court found in favor of Wells Fargo, stating that "the amounts due to Wells Fargo under section 45.0315 were not liquidated when the motion to redeem was filed, at the time that motion was heard, or at any subsequent time." 194 So.3d at 482-83. In so finding, this Court held that "because Wells Fargo's damages were not liquidated, the burden fell on Credo to have set an evidentiary hearing on its motion to redeem and to adduce evidence or to spread a stipulation on the record to prove the amounts that it was obligated to pay under section 45.0315 to redeem." Id. at 483.

Accordingly, we reversed the final order dismissing the foreclosure action, vacated the March 10 Redemption Order and remanded back to the trial court for an evidentiary hearing to determine the amount that must be paid to Wells Fargo to redeem, i.e., payoff, the mortgage. Id. This Court further stated "[i]n light of this determination, we order Wells Fargo to reimburse Credo any sums paid by it in compliance with the March 10 [Redemption Order]." Id. (emphasis added). On June 17, 2016, the mandate issued directing that such further proceedings in this cause take place.

Ten days later, Credo filed an emergency motion in the trial court for contempt for failure to comply with the mandate and for sanctions. Credo alleged it tendered the $3.3 million to Wells Fargo and that, pursuant to the mandate, Wells Fargo should be held in contempt of court for failing to return those funds to Credo.¹

Wells Fargo responded two days later with its own motion to enforce the mandate and for entry of an order permitting Wells Fargo to deposit the funds received in connection with the March 10 Redemption Order into the court registry, a law firm trust account or other escrow account.² Wells Fargo alleged that the March 10 Redemption Order required Credo to pay an incorrect redemption amount, noted that Credo I does not address the sale of the Property by Credo to Speyside and asserted that the intent of this Court was to return the parties to the position they were in prior to the March 10 Redemption Order.³

On July 19, 2016, the trial court entered an order granting Credo's motion to enforce the mandate, requiring Wells Fargo to choose either to accept the $3.3 million in full satisfaction of the Mortgage or to deliver the $3.3 million to Credo, in which event, Speyside would be entitled to intervene.⁴ Six days later, on July 25, 2016, Wells Fargo elected to deliver the $3.3 million to Credo. Speyside, having been granted leave to intervene, filed a motion to require the funds remitted to Credo by Wells Fargo on July 25, 2016 to be deposited into the court registry, essentially, seeking the same relief Wells Fargo had sought.⁵

On April 4, 2017, the trial court held a hearing, noticed as evidentiary, on Speyside's motion. Treating Speyside's motion as seeking injunctive relief, the trial court entered an order requiring Speyside to post an $80,000.00 bond with the court within 72 hours, and ordering Credo to deposit the $3.3 million into the court registry within 72 hours from the posting of the bond by Speyside. The trial court specifically found:

(a) That counsel for SPEYSIDE appeared, along with a representative on behalf of SPEYSIDE, and SPEYSIDE's expert witness;

(b) That counsel for Plaintiff, WELLS FARGO BANK, N.A. appeared, without a representative from Plaintiff or any additional witnesses;

(c) That counsel for CREDO appeared, without a representative from Credo or any additional witness;

(d) That there is a substantial likelihood that the funds at issue, $3,347,233.21, will ultimately belong to Plaintiff than [sic] CREDO;

(e) That the failure to deposit the $3,347,233.21, previously remitted to CREDO, into the Court Registry would result in irreparable harm to SPEYSIDE if the funds are not safe kept, as the realty at issue in this foreclosure action, now owned by SPEYSIDE, remains encumbered by Plaintiff's mortgage.

(f) That the specific funds at issue were generated at closing upon SPEYSIDE's purchase from CREDO and were intended to be applied towards the payoff of Plaintiff's mortgage.

(g) That the threatened injury, i.e., the possibility that CREDO may not safeguard the $3,347,233.21 and it may otherwise be unavailable when the total redemption amount owed to Plaintiff is determined, highly outweighs the possible harm caused to CREDO; and

(h) That the issuance of temporary injunction is equitably justified. SeeHullum v. Bre-lew Corp., 93 [So. 2d] 727 ( [Fla]. 1957) and Jones v. Carpenter, 90 Fla. 407, 106 So. 127 (Fla. 1925).

The trial court based these findings on the following: "the arguments made by counsel for the parties, the case law presented to this Court, this Court's review of all relevant papers, pleadings and orders and its interpretation of the intent of the Third District Court of Appeal's Mandate, the proffer of testimony provided on behalf of SPEYSIDE and for all reasons stated on the record[.]" (Emphasis added).⁶ Further, the trial court specifically noted the equitable nature of the underlying action as an additional reason for requiring the funds to be deposited into the court registry. The very next day, Credo filed the instant appeal.

I. STANDARD OF REVIEW

A trial court is afforded broad discretion in granting, denying, dissolving, or modifying injunctions, and unless a clear abuse of discretion is demonstrated, an appellate court must not disturb the trial court's decision. Jackson v. Echols, 937 So.2d 1247, 1249 (Fla. 3d DCA 2006) (citing Wise v. Schmidek, 649 So.2d 336, 337 (Fla. 3d DCA 1995) ); Vargas v. Vargas, 771 So.2d 594, 595 (Fla. 3d DCA 2000). Our review is limited to whether the trial court's findings are supported by competent substantial evidence. See P & O Ports Fla., Inc. v. Cont'l Stevedoring & Terminals, Inc., 904 So.2d 507, 510 (Fla. 3d DCA 2005) (an appellate court's review of a trial court's findings on factual matters is limited to whether they are supported by competent substantial evidence).

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