Nationstar Mortg., LLC v. Johnson

• Decision Date: 29 June 2018
• Docket Number: Case No. 2D17–2398
• Citation: 250 So.3d 808
• Parties: NATIONSTAR MORTGAGE, LLC, as successor in interest to Wells Fargo Bank, N.A., Appellant, v. Stephen JOHNSON a/k/a Stephen L. Johnson a/k/a Stephen Lynn Johnson; Carrie Johnson a/k/a Carrie Laura Armstrong; and Bonnie Claire Lanese Johnson n/k/a Bonnie Claire Lanese, Appellees.
• Court: Florida District Court of Appeals

250 So.3d 808

NATIONSTAR MORTGAGE, LLC, as successor in interest to Wells Fargo Bank, N.A., Appellant,

v.Stephen JOHNSON a/k/a Stephen L. Johnson a/k/a Stephen Lynn Johnson; Carrie Johnson a/k/a Carrie Laura Armstrong; and Bonnie Claire Lanese Johnson n/k/a Bonnie Claire Lanese, Appellees.

Case No. 2D17–2398

District Court of Appeal of Florida, Second District.

Opinion filed June 29, 2018

Nancy M. Wallace of Akerman LLP, Tallahassee; William P. Heller of Akerman LLP, Fort Lauderdale; and Eric M. Levine of Akerman LLP, West Palm Beach, for Appellant.

Mark P. Stopa of Stopa Law Firm, Tampa, for Appellees Stephen Johnson and Carrie Johnson.

No appearance for remaining Appellee.

ROTHSTEIN–YOUAKIM, Judge.

Nationstar Mortgage, LLC, as successor in interest to Wells Fargo Bank, N.A.,¹ appeals from the dismissal of a foreclosure complaint. Because the trial court erroneously concluded that Nationstar did not have standing at the time of trial, we reverse.

Facts

Stephen L. Johnson executed a promissory note in favor of Wells Fargo Bank, N.A., on May 22, 2012. The note was secured by a mortgage encumbering Johnson's real property in Manatee County, Florida. Johnson made no payments on the note, and Wells Fargo sent Johnson a notice of default. Johnson made no attempt to cure the default, and on April 17, 2013, Wells Fargo filed the underlying foreclosure complaint.² Wells Fargo attached a copy of the note, which was indorsed in blank, to the complaint, and it filed the original blank-indorsed note and the mortgage with the trial court in November 2013. The Johnsons answered the complaint and alleged various affirmative defenses. Wells Fargo filed an amended complaint in September 2015, and the Johnsons filed no answer to that.

In December 2016, Wells Fargo filed a motion to substitute party plaintiff, asserting that during the pendency of the foreclosure action, it had transferred the mortgage to Nationstar and that Nationstar was now the real party in interest. Wells Fargo attached to its motion a copy of the assignment of the mortgage. The day before trial was to begin, Wells Fargo, still the plaintiff, moved for the court to release the original documents that it had filed previously. Wells Fargo also moved to continue the trial so that Nationstar could enter an appearance and request the return of the original documents. Thus, Wells Fargo plainly contemplated that Nationstar would take physical possession of the original note in anticipation of trial.

Trial took place on February 28, 2017. Before it began, the trial court, over the Johnsons' objection, granted Wells Fargo's motion to substitute and granted Wells Fargo's motion and Nationstar's oral request to release the original note and mortgage into Nationstar's custody "for use at trial." During the trial, Nationstar then introduced the original note into evidence through its corporate witness. Although the Johnsons objected to the admission of the assignment of the mortgage, they did not object to the admission of the original note and mortgage.

Relying on Geweye v. Ventures Trust 2013–I–H–R, 189 So.3d 231 (Fla. 2d DCA 2016), and Creadon v. U.S. Bank, N.A., 166 So.3d 952 (Fla. 2d DCA 2015), the Johnsons moved for an involuntary dismissal at the conclusion of Nationstar's case, arguing that Nationstar lacked standing at trial. The trial court agreed and granted the motion. This appeal followed.

Discussion

We review de novo an order granting a motion for involuntary dismissal at the close of the plaintiff's case. Deutsche Bank Nat'l Tr. Co. v. Kummer, 195 So.3d 1173, 1175 (Fla. 2d DCA 2016) (citing Allard v. Al–Nayem Int'l, Inc., 59 So.3d 198, 201 (Fla. 2d DCA 2011) ).

On appeal, Nationstar argues that its physical possession of the original blank-indorsed note at the beginning of the trial was sufficient to establish its standing at trial. We agree. "A plaintiff who is not the original lender may establish standing to foreclose a mortgage loan by submitting a note with a blank or special endorsement, an assignment of the note, or an affidavit otherwise proving the plaintiff's status as the holder of the note." Focht v. Wells Fargo Bank, N.A., 124 So.3d 308, 310 (Fla. 2d DCA 2013). Having granted Wells Fargo's motion to substitute Nationstar as plaintiff, the trial court, upon Wells Fargo's motion and Nationstar's pretrial request, released the original note to Nationstar, and Nationstar introduced the note into evidence. Nationstar, therefore, physically possessed the note at trial and had standing to foreclose at that time as the holder of the note. See § 671.201(21)(a), Fla. Stat. (2016) (defining "holder" as "[t]he person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession"); see also Caraccia v. U.S. Bank, Nat'l Ass'n, 185 So.3d 1277, 1279 (Fla. 4th DCA 2016) ("A negotiable instrument ... is enforceable by the holder ...."); cf. Partridge v. Nationstar Mortg., LLC, 224 So.3d 839, 841–42 (Fla. 2d DCA 2017) (reversing the final judgment and directing the trial court to grant summary judgment in favor of the mortgagor because the original lender had filed the original note with the trial court long before Nationstar commenced its foreclosure action and "Nationstar's unilateral decision to leave the original note ... with the trial court does not establish possession of the note"). Contrary to the Johnsons' contention, Nationstar did not have to show that Wells Fargo had formally transferred the note to it; Nationstar's physical possession of the blank-indorsed note was sufficient to establish its status as the holder. Cf. § 673.3011, Fla. Stat. (2016) (providing that even a person who wrongfully possesses a negotiable instrument may be entitled to enforce it).

Nationstar's possession of the original note at trial distinguishes this case from both Geweye and Creadon.³ In Geweye, JPMorgan Chase Bank, N.A., filed a foreclosure complaint and attached copies of the blank-indorsed note and the mortgage. Subsequently, Chase filed the original note and the original mortgage. 189 So.3d at 232. Later, Chase transferred its interest in the mortgage to Ventures Trust, executed an assignment of the mortgage to Ventures, and moved to substitute Ventures as the party plaintiff. The trial court granted the substitution. Id. At trial, Ventures introduced a copy of the assignment of mortgage. The assignment, however, did not purport to assign any interest in the note, and there was no separate assignment of the note. Id. at 232–33. In reversing, this court explained:

"[A] plaintiff who is not the original lender may establish standing to foreclose a mortgage loan by submitting a note with a blank or special [i]ndorsement, an assignment of the note, or an affidavit otherwise proving the plaintiff's status as the holder of the note." Focht v. Wells Fargo Bank, N.A., 124 So.3d 308, 310 (Fla. 2d DCA 2013). Ventures submitted none of these and thus failed to establish its standing at the time of trial.

Ventures asserted that the original note indorsed in blank, coupled with the assignment of mortgage, provided it with standing. However, Chase filed the original note indorsed in blank with the court long before Ventures was substituted as the party plaintiff. As such, Ventures could not establish that it was the holder or nonholder in possession for purposes of standing. SeeCreadon v. U.S. Bank, N.A., 166 So.3d 952, 954 (Fla. 2d DCA 2015). Further, Ventures failed to explain how the assignment of mortgage, reflecting only the transfer of the mortgage and not the note, provided it with standing; nothing in the assignment of

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