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If Borrower sends a Cease and Desist Letter Argument Can be Made that No Face to Face Requirement is Needed.
On March 25, 2020, the Fourth District Court of Appeal in Bank of America v. Jones, Case No. 4D19-1164 (Fla. 4th DCA 2020) held that if a Borrower sends a cease and desist letter, it is a clear expression that the Borrowers would not cooperate and vitiated the requirement to conduct a face to face meeting. Accordingly, the Fourth District Court of Appeal reversed the involuntary dismissal, and remanded the proceedings. This case is not yet final, and subject to rehearing.
On January 31, 2020, the Second District Court of Appeal in HSBC Bank USA, N.A. v. Sherman, held “that as a dismissal without prejudice does not constitute an adjudication on the merits, in which Plaintiff did not need to send an additional notice of default letter before refiling.”
In reaching this decision, the Second District Court of Appeal cited to PNC Bank, N.A. v. Otero, 277 So. 3d 199 (Fla. 3d DCA 2019), where the the Court held that a dismissal without prejudice “does not constitute an adjudication on the merits” and that “following an involuntary dismissal without prejudice ‘there [is] no practical purpose in requiring an additional notice [of default].' ” Id. at 200-01 (alterations in original) (quoting Sill v. JPMorgan Chase Bank, Nat'l Ass'n, 182 So. 3d 851, 852-53 (Fla. 4th DCA 2016)). Because the instant complaint alleged the same breach as the previous complaint, HSBC was not required to send a new notice under paragraph 22 of the mortgage. See id. at 201 (“[As the first complaint was] dismissed without prejudice, . . . [the original] notice of default remained valid and a second notice of default was not required before filing the second complaint based on the same default.” (alterations in original) (quoting Sill, 182 So. 3d at 852-53)). This case is not yet final and is subject to rehearing.
On Friday, July 14, 2017, the 1st DCA in Forero v. Green Tree Servicing, LLC, Case No. 1D16-2151 (1st DCA July 14, 2017) affirmed that the continuing nature of the default serves to make each foreclosure its own, distinct action, even though the initial date of default was the same as in prior foreclosure actions. Borrower’s appeal raised two main issues: 1) the foreclosure was barred as res judicata under the two dismissal rule (a 2nd voluntary dismissal of a case operates as an adjudication on the merits); and 2) the statute of limitations had expired due to the December 1, 2008 default date. This was the third foreclosure filed with the same 2008 default date and both of the prior foreclosures were voluntarily dismissed. In reaching its decision, the Court ruled, “…the foreclosure action was not rendered res judicata by the two previously dismissed foreclosure suits on the same note, and …the statute of limitations in section 95.11(2)(c), Florida Statutes, did not bar the action due to the inclusion within the allegations of at least some defaulted installment payments within five years of the date the complaint was filed.”
The Court followed the recent rulings in the Desylvester and Bollettieri cases from the 2nd DCA and Supreme Court cases Singleton and Bartram which address the “installment nature” of mortgages and joined the 2nd , 4th and 5th DCAs in confirming that allegations in the complaint of the continuing state of default satisfies the statute of limitations. The Padgett Law Group, through attorney Michael Ruff, represented the servicer in this case, which is a monumental victory that positively impacts Florida law on statute of limitations for lenders and servicers. Click the "read more" link below for the full decision.
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