Thorlton v. Nationstar Mortg., LLC, Case No. 2D17-2328

Citation257 So.3d 596
Decision Date17 October 2018
Docket NumberCase No. 2D17-2328
Parties Peggy A. THORLTON and William D. Thorlton, Appellants, v. NATIONSTAR MORTGAGE, LLC, Appellee.
CourtCourt of Appeal of Florida (US)

Randall O. Reder of Randall O. Reder, P.A., Tampa, for Appellants.

Nancy M. Wallace and Ryan D. O'Connor of Akerman LLP, Tallahassee; William P. Keller of Akerman LLP, Fort Lauderdale; and David A. Karp of Akerman LLP, Tampa, for Appellee.

MORRIS, Judge.

Peggy A. and William D. Thorlton appeal the final judgment of foreclosure entered against them and in favor of Nationstar Mortgage, LLC, following a bench trial. For the reasons we explain, we conclude that Nationstar adequately established that its predecessor in interest, Chase Home Finance a/k/a JPMorgan Chase Bank National Association satisfied a condition precedent to filing suit: providing written notice of default as required by paragraph 22 of the mortgage. Thus we affirm on that issue. We affirm on all other issues without further comment.

BACKGROUND

On May 13, 2003, the Thorltons executed a promissory note and mortgage in favor of Wachovia Mortgage Corporation. Paragraph 22 of the mortgage provided that prior to acceleration, the lender must give the borrower notice and an opportunity to cure the default. Paragraph 15 provided that any such notice must be written and that it "shall be deemed to have been given to Borrower when mailed by first class mail or when actually delivered to Borrower's notice address if sent by other means."

In 2008, Chase Home Finance filed a foreclosure complaint against the Thorltons. Chase alleged that it was the servicer of the loan and acting on behalf of the owner. That complaint alleged generally that all conditions precedent to the acceleration of the note and mortgage had been performed.

Chase subsequently filed two motions for substitution of party plaintiff, alleging first that it had merged with JPMorgan Chase Bank N.A. and, at a later time, that it had become organized under a new charter and had changed its name to JPMorgan Chase Bank, National Association. In July 2016, prior to trial, a motion to substitute Nationstar as the party plaintiff was filed and ultimately granted.

At trial, Nationstar admitted a copy of the default letter purportedly mailed to the Thorltons on October 2, 2008, in compliance with paragraph 22. The letter contained a header proclaiming "CERTIFICATE OF MAILING." As part of the same exhibit, Nationstar included a screenshot from Chase's electronic records indicating that the default letter was scanned into Chase's system on October 3, 2008. The exhibit was admitted through the testimony of Jason George, a default case specialist employed by Nationstar. Mr. George testified that he had previously worked for JPMorgan Chase and, prior to that, worked for Chase Home Finance before the two entities merged. Mr. George testified he worked for Chase from July 2011 until March 2015. He testified generally about his familiarity with Chase's practices and procedures for creating and maintaining records as well as his familiarity with the boarding process that occurs when one lender takes over the servicing of a loan from another lender.

Prior to the admission of the default letter, the Thorltons' counsel objected based on "hearsay, lack of foundation, and lack of personal knowledge." Specifically, the Thorltons' counsel argued that Mr. George did not have personal knowledge of whether the letter was actually mailed out, regardless of whether it was mailed by Chase or by a third-party vendor.1 The Thorltons' counsel also argued that Mr. George was not qualified to lay a business records predicate for the admission of the document when the letter was mailed "by yet another department of the company that he apparently spoke to someone about." The trial court overruled the objection and admitted the letter.

During questioning about the letter, Mr. George testified that the letter was part of Nationstar's business records that had previously been part of Chase's business records. He testified that the records were made by employees with personal knowledge of the information being entered at the time it was entered, that the records were kept in the course of Chase's regularly-conducted business activities, and that it was Chase's regular business practice to make and maintain such records. When asked how he knew that the letter was mailed to the Thorltons, Mr. George responded: "That was the routine practice back then for Chase Home Finance."

On cross-examination, Mr. George testified that he worked in multiple departments with Chase and Nationstar, including two days in Chase's breach letter department. Mr. George acknowledged that Chase used a third-party vendor to mail the breach letters and that he knew this because he worked with the third-party vendor during his training. Mr. George explained that the third-party vendor obtains a PDF copy of the breach letter from the lender, prints and mails it first class, and then sends a CD back to the lender informing the lender that the letter was mailed. Mr. George explained that the lender also receives proof of mailing via a copy of each letter with a "proof of mailing stamp from the post office." Mr. George subsequently admitted that he did not work for the third-party vendor at the time that the Thorltons' breach letter was mailed and that he never actually worked for the third-party vendor. He explained that his knowledge about the third-party vendor's mailing process came through his two-day assignment in Chase's breach letter department. He also explained that his knowledge about the third-party vendor's mailing process came entirely from other Chase employees who told him about the third-party vendor.

On appeal, the Thorltons challenged the sufficiency of the evidence regarding the mailing of the default letter. Specifically, the Thorltons argued that because Mr. George did not work for Chase at the time the letter was mailed, he could not have personal knowledge of that issue and, as a result, Nationstar failed to prove it complied with the condition precedent set forth in paragraph 22 of the mortgage.

In response, Nationstar argued that Mr. George's testimony regarding Chase's routine business practices was sufficient to establish that the letter was mailed. Nationstar asserted that Mr. George was not required to have worked for Chase at the time the letter was mailed in order to establish his knowledge of Chase's routine business practices.

After all briefs had been filed in this case, this court issued Spencer v. Ditech Financial, LLC, 242 So.3d 1189 (Fla. 2d DCA 2018). In Spencer, this court addressed the issue of what constitutes sufficient evidence to establish the mailing of a default letter when the testifying witness was not a current employee of and had never worked for the entity which drafted and mailed the letter. Id. At oral argument, the Thorltons noted the Spencer opinion and argued that it also served as a basis to reverse in this case because like the employee in Spencer, Mr. George did not work for the entity which mailed the letter. The Thorltons filed a notice of supplemental authority citing Spencer on the same day that oral argument occurred.

This court then issued an order directing the parties to address Spencer and its application to this case. The Thorltons' supplemental brief noted that their counsel had raised an objection to the sufficiency of Mr. George's knowledge of the mailing issue at trial, and the Thorltons argued that Spencer was directly on point and required a reversal here because Mr. George testified that his knowledge of the mailing of the letter was based merely on his training and the routine business practices of Chase. Thus, the Thorltons argued that because Mr. George had never worked for the third-party vendor which actually mailed the letter and because his knowledge of the third-party vendor's mailing process had been obtained from other Chase employees, the evidence was insufficient to establish that the letter had been mailed.

In its supplemental brief, Nationstar argued that the Thorltons waived any challenge to Mr. George's testimony regarding routine business practices, arguing that the Thorltons only objected to the admission of the default letter as a business record. Nationstar also argued that this issue was not one related to the sufficiency of the evidence. Instead, Nationstar maintained that the issue was an evidentiary issue related to routine business practices under section 90.406, Florida Statutes (2016), or lack of personal knowledge under section 90.604. Nationstar distinguished Spencer by arguing that there, the testifying witness had never worked for the entity (prior servicer) which drafted the default letter, whereas, in this case, Mr. George had worked for Chase, the entity which drafted the default letter. Nationstar pointed to parts of Mr. George's testimony wherein he described working "at three different stations" in the breach letter department and observing how breach letters were submitted to the third-party vendor for mailing and then how Chase received proof of mailing from the third-party vendor. Thus Nationstar argued that Mr. George's testimony was sufficient under Spencer. Citing other cases, Nationstar also argued that testimony regarding routine business practices related to the drafting and mailing of default letters was sufficient to prove the letter was actually mailed.

ANALYSIS

Addressing first the issue of preservation, we reject Nationstar's attempt to frame this issue as one involving only evidentiary considerations related to the admissibility of a business record. In its answer brief, Nationstar relied on Bank of America, N.A. v. Delgado, 166 So.3d 857 (Fla. 3d DCA 2015), to argue that Mr. George was not required to be employed by Chase at the time the default letter was mailed in order to provide a foundation for the admission of Nationstar's...

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  • Mace v. M&T Bank
    • United States
    • Court of Appeal of Florida (US)
    • 25 Marzo 2020
    ...from which a court can infer that the routine practice was followed and the letter was mailed. See, e.g., Thorlton v. Nationstar Mortg., LLC, 257 So. 3d 596, 601-02 (Fla. 2d DCA 2018) ; CitiMortgage, Inc. v. Hoskinson, 200 So. 3d 191, 192 (Fla. 5th DCA 2016). And a third is properly admitte......
  • Hicks v. State
    • United States
    • Court of Appeal of Florida (US)
    • 12 Junio 2019
    ...1st DCA 2013) ).In fairness, we should have allowed supplemental briefing on this issue. See, e.g., Thorlton v. Nationstar Mortg., LLC , 257 So. 3d 596, 601 (Fla. 2d DCA 2018) (noting that "no due process violation has occurred" through the court's reliance on a new decision released after ......
  • Lapace v. State
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    • 17 Octubre 2018
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    • Court of Appeal of Florida (US)
    • 26 Julio 2019
    ...the paragraph 22 letter was created and mailed, to establish a rebuttable presumption of mailing. See Thorlton v. Nationstar Mortg., LLC, 257 So. 3d 596, 601-02 (Fla. 2d DCA 2018) (affirming final judgment of foreclosure where Nationstar sufficiently established mailing of the paragraph 22 ......
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1 books & journal articles
  • Chapter 2-2 Notice of Default and Opportunity to Cure
    • United States
    • Full Court Press Florida Foreclosure Law 2022 Chapter 2 Default and Acceleration
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    ...is mailed by a third-party mailing vendor, which then sends proof of mailing back to the employer. Thorlton v. Nationstar Mortg., LLC, 257 So. 3d 596, 602 (Fla. 2d DCA 2018). In the Fifth District, testimony of a loan servicer's routine practice by an employee who had seen the routine pract......

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