Torres v. Deutsche Bank Nat'l Trust Co.

• Decision Date: 31 October 2018
• Docket Number: No. 4D17-2727,4D17-2727
• Citation: 256 So.3d 903
• Parties: Samuel TORRES and Melissa Renaldo, Appellants, v. DEUTSCHE BANK NATIONAL TRUST COMPANY, Appellee.
• Court: Florida District Court of Appeals

256 So.3d 903

Samuel TORRES and Melissa Renaldo, Appellants,

v.DEUTSCHE BANK NATIONAL TRUST COMPANY, Appellee.

No. 4D17-2727

District Court of Appeal of Florida, Fourth District.

[October 31, 2018]

Mark L. Pomeranz of Pomeranz & Associates, P.A., Hallandale, for appellants.

James H. Wyman of Hinshaw & Culbertson LLP, Coral Gables, for appellee.

Forst, J.

Appellants Samuel Torres and Melissa Renaldo ("Borrowers") appeal the final judgment of foreclosure entered in favor of Appellee Deutsche Bank National Trust Company ("the Bank"). Borrowers argue the Bank lacked standing to bring the foreclosure action and failed to comply with conditions precedent to foreclose. We affirm without comment on the standing issue. However, we find that the Bank failed to prove compliance with the condition precedent of mailing Borrowers a default notice as required by paragraph 22 of the mortgage. Thus, we reverse and remand for the trial court to enter an order of involuntary dismissal.

Background

Borrowers executed a note and mortgage with Novastar Mortgage, Inc. ("Novastar"). 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 such notice must be written and "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."

The mortgage was assigned to the Bank. Shortly thereafter, the Bank filed a foreclosure complaint against Borrowers, alleging a default under the note and mortgage. The complaint also maintained that all conditions precedent to foreclosure had been fulfilled. In Borrowers' answer, they asserted as an affirmative defense that the Bank failed to comply with the condition precedent of mailing a default notice to Borrowers.

At trial, Bank introduced a default letter addressed to Borrowers from Novastar's servicer, Saxon, through the testimony of a senior loan analyst for the Bank's servicer, Ocwen Financial ("Ocwen"). The loan analyst's testimony laid the necessary foundation for admission of the notice letter, and admissibility of the letter is not at issue on appeal.

The loan analyst testified that, based upon the words "CERTIFIED MAIL" and "Return Receipt Requested" typed on the letter, and the barcode on the letterhead, she believed the letter had been sent to Borrowers. She admitted the file did not contain a copy of a return receipt. When asked if it was possible that the letter was created but never actually mailed, the loan analyst stated, "I don't see what would be the point of the servicer taking the time, money, and energy to generate a letter and not mail it out." The loan analyst further testified that although she was "not sure exactly how Saxon does it," she knew that once a borrower is in default, a letter is generated and verified before it is sent out. When asked if the Saxon payment history might reflect the certified mail cost of sending the letter, the loan analyst identified an entry for $7.00 dated one day after the date on the letter and labelled "breach fee." She stated that Ocwen's certified mail cost was $6.53, "[s]o it is similar."

The trial court denied Borrowers' motion for involuntary dismissal, and subsequently entered a final judgment of foreclosure in favor of the Bank.

Analysis

We review the denial of a motion for involuntary dismissal de novo. Deutsche Bank Nat'l Trust Co. v. Huber , 137 So.3d 562, 563 (Fla. 4th DCA 2014). An involuntary dismissal is proper when the evidence, viewed in the light most favorable to the non-moving party, fails to establish a prima facie case. Wells Fargo Bank, N.A. v. Balkissoon, 183 So.3d 1272, 1275 (Fla. 4th DCA 2016).

Where there are conditions precedent to filing the foreclosure suit, a bank must prove that it has substantially complied with them. Ortiz v. PNC Bank, Nat'l Ass'n, 188 So.3d 923, 925 (Fla. 4th DCA 2016). Along with the note, mortgage, and evidence regarding the outstanding debt on the loan, the default or acceleration letter must be introduced to demonstrate entitlement to foreclosure. Liberty Home Equity Sols., Inc. v. Raulston , 206 So.3d 58, 60 (Fla. 4th DCA 2016). In addition to introducing the letter, the bank must also present competent, substantial evidence that the letter was actually mailed. Ensler v. Aurora Loan Servs., LLC , 178 So.3d 95, 97 (Fla. 4th DCA 2015).

Evidence that a document was drafted is insufficient, standing alone, to establish that it was in fact mailed. See Burt v. Hudson & Keyse, LLC , 138 So.3d 1193, 1195 (Fla. 5th DCA 2014). Rather, the "mailing must be proven by producing additional evidence such as proof of regular business practices, an affidavit swearing that the letter was mailed, or a return receipt." CitiBank, N.A. for WAMU Series 2007-HE2 Tr. v. Manning , 221 So.3d 677, 681 (Fla. 4th DCA 2017) (quoting Allen v. Wilmington Tr., N.A. , 216 So.3d 685, 688 (Fla. 2d DCA 2017) ).

If the evidence comes by way of witness testimony, "the witness must have personal knowledge of the company's general practice in mailing letters." Allen , 216 So.3d at 688 (citing CitiMortgage, Inc. v. Hoskinson , 200 So.3d 191, 192 (Fla. 5th DCA 2016) ); accord Spencer v. Ditech Fin., LLC , 242 So.3d 1189, 1191 (Fla. 2d DCA 2018). Mere reliance on the boarding process to prove that the notice...