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Florida Court Rules on Foreclosure Judgement, Deficiency With Complaint

Last month, the Third DCA affirmed the lower court’s order denying relief from a foreclosure judgment despite the borrower’s assertion that the judgment was void due to procedural deficiencies pertaining to Deutsche Bank’s substitution into the case as the plaintiff. Van Tran v. Deutsche Bank Nat’l Tr. Co. In Van Tran, the initial plaintiff, OneWest Bank, filed a foreclosure complaint against Van Tran and other defendants. Van Tran failed to respond to the complaint, which resulted in the Clerk of Court issuing a default against Van Tran.

Thereafter, OneWest moved to substitute Deutsche Bank as the new plaintiff. The court entered an order granting the substitution and requiring “a corresponding amendment to the style of the case.” Months later the matter proceeded to a non-jury trial. The trial order reflected Deutsche Bank as the plaintiff. Van Tran failed to appear for trial and despite filing (via counsel) an emergency motion to continue trial, Van Tran failed to raise any procedural issues with the trial notice. The court denied Van Tran’s motion for continuance, the trial proceeded, and the court entered judgment for Deutsche Bank.

“Some years later” Van Tran filed a motion for relief from the judgment under Florida Rule of Civil Procedure 1.540(b)(4), asserting it was void because “the complaint was never formally amended to reflect Deutsche Bank as the party plaintiff…” The lower court denied the requested relief and Van Tran appealed that order. The Third DCA affirmed the lower court on the basis that the judgment “at best” was voidable since there was no deprivation of due process. The Court noted that the amending the style of the case “to effect a substitution of the parties,” as ordered by the lower tribunal, “essentially” required amending the complaint. The Court went on to state “… the ensuing collateral attack was time-barred” since rule 1.540(b) motions must be brought within one year from entry of judgment.

The Court explained that “errors, irregularities or wrongdoing in proceedings, short of illegal deprivation of opportunity to be heard…will not render the judgment void.” The Court further elaborated that Van Tran failed to object to OneWest’s motion to substitute, failed to raise a procedural objection upon receipt of the trial notice reflecting Deutsche Bank as the plaintiff and failed to defend the suit at trial. Although strictly speaking, an amendment to the complaint was required, “the identical result was obtained by the pretrial order which did substitute [Deutsche Bank] ….” as the party plaintiff. Further, the Court explained that Van Tran received a copy of the judgment which reflected Deutsche Bank as the plaintiff, but Van Tran still failed to seek timely relief based on the alleged procedural deficiency.

The Court affirmed the judgment noting Florida’s “deep-rooted policy in favor of the repose of judgments…the interest in finality, and the concern in the stability of property titles.”

About Author: Roy Diaz

Roy A. Diaz is the Managing Shareholder of Diaz, Anselmo Lindberg, P.A. The firm provides representation in Florida, Illinois, Ohio, Indiana, Kentucky, Wisconsin and Michigan. Diaz has been a member of the Florida Bar since 1988. He has concentrated his practice in the areas of real estate, litigation, and bankruptcy. He has represented lenders, servicers of both conventional and GSE loans, private investors, and real estate developers throughout his career with an emphasis on the mortgage servicing industry for over 25 years.
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