Pealer v. Wilmington Trust Nat'l Ass'n

• Decision Date: 17 March 2017
• Docket Number: Case No. 2D15–2822
• Citation: 212 So.3d 1137 (Mem)
• Parties: Bonnie PEALER, Appellant, v. WILMINGTON TRUST NATIONAL ASSOCIATION, as trustee FOR the MFRA TRUST; William W. Pealer; Kathleen Bedard, a/k/a Kathleen R. Bedard; Elizabeth Turner; and Claud Turner, Appellees.
• Court: Florida District Court of Appeals

212 So.3d 1137 (Mem)

Bonnie PEALER, Appellant,

v.WILMINGTON TRUST NATIONAL ASSOCIATION, as trustee FOR the MFRA TRUST; William W. Pealer; Kathleen Bedard, a/k/a Kathleen R. Bedard; Elizabeth Turner; and Claud Turner, Appellees.

Case No. 2D15–2822

District Court of Appeal of Florida, Second District.

Opinion filed March 17, 2017

Michael P. Fuino of Weidner Law, P.A., St. Petersburg, for Appellant.

D.S. "Dar" Airan of Airan Law, P.A., Miami (withdrew after briefing); Roger N. Gladstone, Jason Joseph, and Amina McNeil of Gladstone Law Group, P.A., Boca Raton (substituted as counsel of record), for Appellee Wilmington Trust National Association.

No appearance for remaining Appellees.

PER CURIAM.

Affirmed.

CASANUEVA and KHOUZAM, JJ., Concur.

SLEET, J., Concurs specially.

SLEET, Judge, Specially concurring.

Bonnie Pealer appeals the final judgment of foreclosure in favor of Wilmington Trust National Association. On appeal, Mrs. Pealer challenges the admission of the bank's payment history, the bank's standing to foreclose, and the award of attorney fees against Kathleen Bedard and Claud and Elizabeth Turner. I concur with the majority that none of Mrs. Pealer's arguments have merit. I write only to note that because Mrs. Pealer was not a party to the underlying note and mortgage, it is questionable whether she even had standing to raise these issues below.

The record reflects that the note was signed by Ms. Bedard and that the mortgage was signed by Ms. Bedard and the Turners. The mortgage was dated September 10, 2007, and the bank alleged that Ms. Bedard and the Turners defaulted on November 1, 2011. The Pealers acquired the property from a foreclosure sale on July 5, 2011, after the homeowner's association foreclosed on its subordinate lien. JP Morgan Chase filed the first complaint in this action on February 20, 2013, naming the Pealers, the Turners, Ms. Bedard, and others as defendants. Wilmington Trust National Association was substituted as party plaintiff by an agreed order prior to trial. Final judgment of foreclosure was entered in favor of the bank after a nonjury trial.

Ms. Bedard and the Turners took no part in the bank's foreclosure action. However, the Pealers participated fully at trial, disputing the admissibility of the bank's records and challenging the bank's standing to foreclose. Mrs. Pealer even testified at trial regarding her personal suspicions that the bank had engaged in fraud and forgery in obtaining ownership of the note. Although by failing to object the bank waived any argument that the Pealers lacked standing to fully participate in the foreclosure proceeding because they were not parties to the note and mortgage, see Corrigan v. Bank of Am., N.A. , 189 So.3d 187, 192 n.2 (Fla. 2d DCA 2016), had they properly preserved such an argument, I believe it would have had merit in this case.

The Pealers took their interest in the property before the bank filed its complaint or lis pendens. Therefore, they were indispensable parties properly named in the bank's complaint. SeeU.S. Bank Nat'l Ass'n v. Bevans , 138 So.3d 1185, 1188 (Fla. 3d DCA 2014). However, they did not assume the mortgage at the time they purchased the property; according to Mrs. Pealer's trial testimony, the Pealers took their interest with actual notice of and subject to the bank's superior mortgage. Thus, they do not stand in the shoes of the mortgagors and cannot participate in the bank's foreclosure as though they were a party to the mortgage. See, e.g. , CCM Pathfinder Palm Harbor Mgmt., LLC v. Unknown Heirs of Gendron , 198 So.3d 3, 7 (Fla. 2d DCA) ("[I]f a recorded mortgage is valid on its face, a subsequent purchaser ‘is assumed to have recognized it as a valid lien against the property which he is buying.’ " (quoting Spinney v. Winter Park Bldg. & Loan Ass'n , 120 Fla. 453, 162 So. 899, 904 (Fla. 1935) )), review denied sub nom. Thebeau v. CCM Pathfinder Palm Harbor Mgmt., LLC , 192 So.3d 45 (Fla. 2015) ; Clay Cty. Land Trust No. 08–04–25–0078–014–27, Orange Park Trust Servs., LLC v. JPMorgan Chase Bank, Nat'l Ass'n , 152 So.3d 83, 84 (Fla. 1st DCA 2014) (holding that only a party to a mortgage could challenge a violation of the mortgage's terms); Irwin v. Grogan–Cole , 590 So.2d 1102, 1104 (Fla. 5th DCA 1991) (holding that a subsequent purchaser who took subject to a superior mortgage could not challenge the running of the statute of limitations). Therefore I question whether the Pealers' limited interest in the property provided them standing to challenge the bank's standing to foreclose or the admissibility of the bank's records at trial.

Standing "requires a would-be litigant to demonstrate that he or she reasonably expects to be affected by the outcome of the proceedings, either directly or indirectly." Hayes v. Guardianship of Thompson , 952 So.2d 498, 505 (Fla. 2006). And "[t]he party asserting standing must have ‘a sufficient stake in a justiciable controversy, with a legally cognizable interest that would be affected by the outcome of the litigation.’ " Whitburn, LLC v. Wells Fargo Bank, N.A. , 190 So.3d 1087, 1091 (Fla. 2d DCA 2015) (quoting Centerstate Bank Cent. Fla., N.A. v. Krause , 87 So.3d 25, 28 (Fla. 5th DCA 2012) ). "The issue of whether a party has standing in a particular action is not subject to a blanket rule[ ] but, instead, requires examination of the asserted interest." Krause , 87 So.3d at 28. As we explained in Whitburn , a third-party purchaser's "interest in [a] foreclosure proceeding is not a legally cognizable interest because even though it now holds legal title to the property, it purchased the property subject to [the bank's] foreclosure proceeding and superior interest in the property." Whitburn , 190 So.3d at 1091–92.

The Pealers hold a subordinate interest in the property; therefore under section 45.0315, Florida Statutes (2016), they have a right of redemption. At any time before the filing of the certificate of sale, the Pealers "may cure the mortgagor's indebtedness and prevent a foreclosure sale by paying the amount of moneys specified in the judgment, order, or decree of foreclosure." § 45.0315. They may choose to exercise this right prior to the entry of a foreclosure judgment "by tendering the performance due under the security agreement, including any amounts due because of the exercise of a right to accelerate, plus the reasonable expenses of proceeding to foreclosure incurred to the time of tender, including reasonable attorney's fees of the creditor." Id. However, until the Pealers assert their right of redemption and attempt to clear title to the property, their interest in the bank's...