Deutsche Bank Nat'l Trust Co. v. Sombrero Beach Rd., LLC
Decision Date | 28 November 2018 |
Docket Number | No. 3D16-2884,3D16-2884 |
Citation | 260 So.3d 424 |
Parties | DEUTSCHE BANK NATIONAL TRUST COMPANY, as Indenture Trustee Under the Indenture Relating to IHM Assets Corp., Collateralized Asset-Backed Bonds, Series 2004-7, Appellant, v. SOMBRERO BEACH ROAD, LLC, a Florida Limited Liability Company, et al., Appellees. |
Court | Florida District Court of Appeals |
Blank Rome LLP, Anthony R. Yanez and Nicole R. Topper (Fort Lauderdale), for appellant.
Oppenheim & Pilelsky, Yanina Zilberman, Roy D. Oppenheim, Geoffrey E. Sherman and Jacquelyn Trask (Weston), for appellees.
Before, SUAREZ, SCALES, and LUCK, JJ.
Deustche Bank National Trust Company, as Indenture Trustee under the Indenture Relating to IHM Assets Corp., Collateralized Asset Backed Bonds, Series 2004-7 ("Deutsche Bank"), the plaintiff below, appeals a final order dismissing with prejudice its foreclosure action for Deutsche Bank's alleged repeated failure to comply with unspecified trial court orders. We reverse and remand for the trial court to hold an evidentiary hearing to apply the factors espoused in Kozel v. Ostendorf, 629 So.2d 817 (Fla. 1993) ( ).
In June 2015, Deutsche Bank filed the instant action to foreclose on a residential mortgage encumbering real property located in Monroe County. In June 2016, the appellees, defendants below, filed their answer and affirmative defenses to the complaint.
On August 1, 2016, the trial court entered an order ("the Trial Order") setting the case for trial in November 2016, and also scheduling a pre-trial conference before a special master on September 15, 2016. The Trial Order specified that both the trial attorneys and the parties were required to attend the pre-trial conference, the failure of which could result in dismissal of the action.1
Neither a representative from Deutsche Bank, nor Deutsche Bank's trial counsel, attended the September 15, 2016 pre-trial conference. Consequently, the special master entered a report and recommendation recommending that Deutsche Bank's complaint be dismissed for its failure to appear at the pre-trial conference.
On September 20, 2016, Deutsche Bank filed an exception to the special master's recommendation of dismissal, attaching an affidavit of the Hearings Department Supervisor from the law firm that represented Deutsche Bank in the lower proceedings. In the affidavit, the Hearings Department Supervisor attested that the law firm had received the Trial Order on August 2, 2016, but that "the Pre-trial Conference cited within the Order and scheduled for September 15, 2016, was never placed on the ... Attorney Hearing Calendar nor was the Plaintiff itself notified that it was required to appear at said hearing, due to my department's failure to enter that information into the internal case management system."
On September 26, 2016, the appellees filed their response in opposition to Deutsche Bank's exceptions to the special master's recommendation of dismissal. Therein, the appellees alleged additional grounds for the trial court to dismiss the action beyond Deutsche Bank and its trial counsel's failure to attend the September 15, 2016 pre-trial conference. Specifically, the appellees alleged, among other things, that: (i) Deutsche Bank and its current trial counsel had failed to comply with various requirements set forth in a March 7, 2016 scheduling order in this case; and (ii) in a prior action to foreclose the same mortgage before a different trial judge, Deutsche Bank and its prior counsel had similarly failed to comply with the various requirements set forth in a scheduling order resulting in the prior action ultimately being dismissed without prejudice.
On November 2, 2016, without conducting a hearing on Deutsche Bank's exceptions or the appellees' response, the trial court entered an order ratifying and approving the special master's recommendation that the instant foreclosure action be dismissed, for failure to attend the September 15, 2016 pre-trial conference. Immediately thereafter on that same day, and also without holding a hearing, the trial court then entered a separate order giving additional grounds for the lower court's dismissal of this action. In this second order, the trial court explained that, while it normally would not dismiss a case with prejudice for failure to attend a pre-trial conference, repeated violations of court orders in both the instant foreclosure action and the prior foreclosure action warrant the extreme sanction:
On November 7, 2016, the trial court entered a final order of dismissal with prejudice. That same day, Deutsche Bank moved for rehearing, arguing that the trial court had failed both to: (i) provide Deutsche Bank with an evidentiary hearing, and (ii) engage in the six-factor analysis to determine whether a dismissal with prejudice was an appropriate sanction for the errant conduct of Deutsche Bank's trial counsel. See Kozel, 629 So.2d at 818. The trial court denied the motion for rehearing, and Deutsche Bank appealed.
Dismissing an action with prejudice as a sanction for failing to comply with multiple court orders is "the most severe of all sanctions which should be employed only in extreme circumstances." Ham v. Dunmire, 891 So.2d 492, 495 (Fla. 2004) (quoting Mercer v. Raine, 443 So.2d 944, 946 (Fla. 1983) ). "While no ‘magic words’ are required, the trial court must make a ‘finding that the conduct upon which the order is based was equivalent to willfulness or deliberate disregard.’ " Id. at 496 (quoting Commonwealth Fed. Sav. & Loan Ass'n v. Tubero, 569 So.2d 1271, 1273 (Fla. 1990) ).
To ensure that a party is not overly punished for the errors of the party's trial counsel, the Florida Supreme Court has articulated a six-factor test that the trial court must consider when determining whether dismissal with prejudice is warranted due to counsel's errant conduct:
1) whether the attorney's disobedience was willful, deliberate, or contumacious, rather than an act of neglect or inexperience; 2) whether the attorney has been previously sanctioned; 3) whether the client was personally involved in the act of disobedience; 4) whether the delay prejudiced the opposing party through undue expense, loss of evidence, or in some other fashion; 5) whether the attorney offered reasonable justification for noncompliance; and 6) whether the delay created significant problems of judicial administration.
Kozel, 629 So.2d at 818. In conducting this analysis, the trial court "must make express findings of fact concerning each of the Kozel factors." Deutsche Bank Nat'l Trust Co. v. Cagigas, 85 So.3d 1181, 1182 (Fla. 3d DCA 2012) ; see also Deutsche Bank Nat'l Trust Co. v. Avila-Gonzalez, 164 So.3d 90, 93 (Fla. 3d DCA 2015) (). This generally requires the trial court to conduct an evidentiary hearing. See Chappelle v. S. Fla. Guardianship Program, Inc., 169 So.3d 291, 293 (Fla. 4th DCA 2015) ; Celebrity Cruises, Inc. v. Fernandes, 149 So.3d 744, 752 (Fla. 3d DCA 2014) ; Toll v. Korge, 127 So.3d 883, 887-88 (Fla. 3d DCA 2013).
In this appeal, the appellees argue that the trial court was not required to conduct the Kozel analysis, claiming that, on this record, it is apparent that Deutsch Bank itself, rather than Deutsche Bank's trial counsel, was guilty of the misconduct cited by the trial court. See Avila-Gonzalez, 164 So.3d at 93 () ; Ledo v. Seavie Resources, LLC, 149 So.3d 707, 710 (Fla. 3d DCA 2014) (). We disagree. In this...
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