Sorrell v. U.S. Bank Nat'l Ass'n, 2D14–3883.

• Decision Date: 06 April 2016
• Docket Number: No. 2D14–3883.,2D14–3883.
• Citation: 198 So.3d 845
• Parties: Michael SORRELL, Appellant, v. U.S. BANK NATIONAL ASSOCIATION, as Trustee for Structured Asset Securities Corporation Mortgage Pass–Through Certificates, Series 2006–BC5, Appellee.
• Court: Florida District Court of Appeals

198 So.3d 845

Michael SORRELL, Appellant,

v.U.S. BANK NATIONAL ASSOCIATION, as Trustee for Structured Asset Securities Corporation Mortgage Pass–Through Certificates, Series 2006–BC5, Appellee.

No. 2D14–3883.

District Court of Appeal of Florida, Second District.

April 6, 2016.

Rehearing Denied May 5, 2016.

Jason J. Ricardo of Ricardo & Wasylik, PL, Dade City, for Appellant.

Dean A. Morande and Michael K. Winston of Carlton Fields Jorden Burt, P.A., West Palm Beach, for Appellee.

VILLANTI, Chief Judge.

Michael Sorrell appeals the final judgment of foreclosure entered against him and in favor of U.S. Bank National Association after a bench trial. Because U.S. Bank failed to prove that it had standing to foreclose at the inception of the case, we must reverse.

The record on appeal shows that Sorrell signed a promissory note in favor of BNC Mortgage, Inc., on August 11, 2006, and he secured the note with a mortgage, also in favor of BNC Mortgage, on his home in Wesley Chapel. The mortgage indicated that MERS would be acting as the nominee of the lender.

On May 19, 2008, U.S. Bank filed a two-count foreclosure complaint against Sorrell. Count one was for foreclosure of the mortgage; count two was for reestablishment of a lost note. In its complaint, U.S. Bank alleged that it was the owner and holder of the note and mortgage, and it attached copies of a mortgage and note to its complaint. However, the mortgage showed that it was in favor of BNC Mortgage, and the copy of the unindorsed note showed that it was payable to BNC Mortgage. Further, the note attached to the complaint did not include an allonge. Therefore, as of the date the original complaint was filed, no document of record connected U.S. Bank to its allegations that it owned and held the note and mortgage.

On January 12, 2009, U.S. Bank filed an amended complaint, dropping the lost note count. Attached to the amended complaint was an assignment of the mortgage from MERS to U.S. Bank, which was signed on November 24, 2008, and recorded on December 2, 2008. However, no documents relating to the note were attached to the amended complaint. Sorrell filed an answer and affirmative defenses to the amended complaint, in which he alleged in part that U.S. Bank did not have standing because it did not own or hold the note when it filed the original complaint.

On April 22, 2009, U.S. Bank filed a notice of filing the original note and mortgage and a copy of the assignment of the mortgage. In the stack of filed documents on the page after the original note was an undated allonge signed by Jamie Langford on behalf of BNC Mortgage. The undated allonge is partially typed and partially handwritten. It was undisputed at trial that the allonge was not “affixed” to the note but rather was a separate document filed in the court file. The allonge does not identify what relationship Jamie Langford had to BNC Mortgage.

At the bench trial on the amended complaint, U.S. Bank offered the testimony of Kim Daye, a loan verification specialist for Wells Fargo Bank, N.A, which was the servicer for Sorrell's loan beginning on December 1, 2006. Daye identified the original mortgage, the original note, and the undated allonge as business records of Wells Fargo. He testified that the “transfer” of the note and mortgage to Wells Fargo for servicing occurred on December 1, 2006; however, he admitted that he had no knowledge of the transaction outside of what was reflected in the documents themselves and that none of the documents established the date that U.S. Bank actually acquired the note and mortgage. More importantly, Daye admitted that he had no documents or other evidence to establish that U.S. Bank owned or held the note and mortgage as of May 19, 2008—the date the original complaint was filed—and there were no documents to show when the allonge was created and signed or when (or if) it was attached to the note.

At the close of U.S. Bank's case, Sorrell argued that U.S. Bank was not entitled to judgment in its favor because it had not proven that it owned and held the note and mortgage on the date the original complaint was filed. The trial court denied Sorrell's motion for involuntary dismissal and entered the final judgment of foreclosure in favor of U.S. Bank. This appeal ensued.

In light of the wealth of current case law on this issue, it should no longer be a surprise to a foreclosure plaintiff that it must prove that it had standing to foreclose on the date the original complaint was filed. See, e.g., Corrigan v. Bank of Am., N.A., 189 So.3d 187 (Fla. 2d DCA2016) (en banc); Tomlinson v. GMAC Mortg., LLC, 173 So.3d 1121, 1122 (Fla. 2d DCA 2015) (quoting Focht v. Wells Fargo Bank, N.A., 124 So.3d 308, 310 (Fla. 2d DCA 2013) ); Vidal v. Liquidation Props., Inc., 104 So.3d 1274, 1276 (Fla. 4th DCA 2013) (quoting McLean v. JP Morgan Chase Bank Nat'l Ass'n, 79 So.3d 170, 173 (Fla. 4th DCA 2012) ). To have standing to foreclose, the plaintiff must own or hold the note at issue. See May v. PHH Mortg. Corp., 150 So.3d 247, 248 (Fla. 2d DCA 2014) ; Khan v. Bank of Am., N.A., 58 So.3d 927, 928 (Fla. 5th DCA 2011). Standing to foreclose by one other than the original lender can be established through evidence of an assignment or equitable transfer of the note and mortgage completed before the complaint is filed. See Focht, 124 So.3d at 310 ; Joseph v. BAC Home Loans Servicing, LP, 155 So.3d 444, 446–47 (Fla. 4th DCA 2015). Standing cannot be established by simply filing a note with an undated indorsement or allonge months after the original complaint was filed. See Focht, 124 So.3d at 310 ; Cutler v. U.S. Bank Nat'l Ass'n, 109 So.3d 224, 226 (Fla. 2d DCA 2012) (noting that if the bank could not establish that the undated allonge took effect prior to the complaint being filed, then it would not have standing to bring the foreclosure action). And attempting to bedazzle the trial court with documents establishing all sorts of facts unrelated to standing at the inception of the case will not carry the day.

To prove standing when in possession of only an undated indorsement or allonge, the plaintiff must introduce other admissible evidence to prove that it had the right to enforce the note on the date the complaint was filed. See Focht, 124 So.3d at 310–11 ; Feltus v. U.S. Bank Nat'l Ass'n, 80 So.3d 375, 377 n.2 (Fla. 2d DCA 2012) (stating that to have standing, the bank would have to prove that the indorsement in blank was effectuated before the complaint was filed). This evidence could include testimony from a competent...