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Skyworks, Ltd. v. Centers for Disease Control & Prevention, No. 5:20-CV-2407, 2021 WL 911720 (N.D. Ohio Mar. 10, 2021) is a case of first impression for Ohio. While the Eastern District of Texas in Terkel v. Centers for Disease Control & Prevention, 6:20-CV-00564, 2021 WL 742877 (E.D. Tex. Feb. 25, 2021), found that the CDC Order to be unconstitutional, Skyworks holds that the “Centers for Disease Control and Prevention's orders—Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19, 85 Fed. Reg. 55,292 (Sept. 4, 2020) and Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19, 86 Fed. Reg. 8020 (Feb. 3, 2021)—exceed the agency's statutory authority provided in Section 361 of the Public Health Service Act, 42 U.S.C. § 264(a), and the regulation at 42 C.F.R. § 70.2 promulgated pursuant to the statute, and are, therefore, invalid.” The Ohio case focuses on statutory authority, while the Texas case focuses on constitutionality.
The Supreme Court of Texas, in PNC Mortgage v. Howard, recently held that the holder of a deed of trust was entitled to foreclose through equitable subrogation, even after the four-year foreclosure statute of limitations had lapsed. Click here to read the opinion.
In 2003, the borrowers purchased a home with loans secured by two purchase-money liens on their property. Two years later, the borrowers refinanced the mortgages with a new loan and paid off the purchase-money mortgages. The note and deed of trust securing the loan were subsequently assigned to and acquired by a new lending entity (“mortgagee”).
In January 2009, the mortgagee notified the borrowers of their default and intent to accelerate the loan, and five months later, accelerated the note. Concurrently, the original lender initiated foreclosure proceedings against the borrowers despite having assigned the loan to the mortgagee, which resulted in a sale of the property.
Arkansas Court of Appeals Holds Statute of Limitation Bars Foreclosure Five (5) Years After Acceleration Unless There Is Clear Intent to Abandon the Acceleration
On September 9. 2020, in the case of Ocwen Loan Servicing, LLC v. Oden, 2020 Ark. App. 384, The Arkansas Court of Appeals clarified what is needed to abandon a prior acceleration of a loan for purposes of the statute of limitations. The Court held that the servicer must show a clear intent to abandon a prior acceleration to prevent the expiration of the limitation period.
In Oden, the borrower’s last payment was made in November 2010, and the servicer declared a default on December 2, 2010. The servicer then sent a Notice of Acceleration on March 17, 2011, after which two different non-judicial foreclosures were started then canceled. In 2015 and 2016, eight (8) separate “Delinquency Notices” were sent to the borrows that stated the number of days since the date the loan had become delinquent and the total amount necessary to bring the loan current. In 2017, the borrowers filed a declaratory judgment action claiming that foreclosure was barred by Arkansas’ five (5) year statute of limitations.
On January 14, 2021, the United States Supreme Court handed down their decision in City of Chicago v. Fulton, No. 19-357, 2021 WL 125106 (Jan. 14, 2021). The question before the Court was whether an entity violates §362(a)(3) by retaining possession of a debtor’s property after a bankruptcy petition is filed. The Court held that mere retention of estate property after the filing of a bankruptcy petition does not violate §362(a)(3) of the Bankruptcy Code.
Until this decision, the majority position held by the Second, Seventh, Eighth, Ninth, and Eleventh Circuits was that the automatic stay prohibited a creditor’s passive retention of property seized before a bankruptcy case began. Weber v. SEFCU (In re Weber), 719 F.3d 72, 81 (2d Cir. 2013); Thompson v. General Motors Acceptance Corp., 566 F.3d 699 (7th Cir. 2009), Knaus v. Concordia Lumber Co. (In re Knaus), 889 F.2d 773, 775 (8th Cir. 1989); California Emp’t Dev. Dep’t v. Taxel (In re Del Mission Ltd.), 98 F.3d 1147, 1151 (9th Cir. 1996); Motors Acceptance Corp. v. Rozier (In re Rozier), 376 F.3d 1323, 1324 (11th Cir. 2004).
Florida Supreme Court Holds Borrower is Entitled to Attorney’s Fees Despite Bank’s Failure to Prove Standing at the Inception of the Case
On December 31, 2020, in Page v. Deutsche Bank Trust Company Americas, No. SC19-1137, the Florida Supreme Court quashed the Fourth DCA’s ruling that the borrower was not entitled to attorney’s fees due to the bank's failure to prove standing, and approved the decisions made in Madl v. Wells Fargo Bank, N.A., 244 So. 3d 1134 (Fla. 5th DCA 2017) and Harris v. Bank of New York Mellon, 2018 WL 6816177 (Fla. 2d DCA 2018).
In Page, the lower court held that the bank did not prove standing at the time the complaint was filed, but did establish standing at trial. The Fourth DCA ruled that the borrower who successfully argues that the bank lacked standing at the time the suit was filed cannot rely on the contract to obtain attorney’s fees under Fla. Stat. section 57.105(7).
The Fourth DCA in Page certified conflict with the Fifth DCA’s decision in Madl and the Second DCA’s decision in Harris. Both Madl and Harris held that a prevailing borrower is entitled to attorney’s fees if it is established that plaintiff became subject to the unilateral fee provision in the contract. In other words, if plaintiff lacks standing at the time the suit was filed, but subsequently establishes standing at trial, then the borrower is entitled to attorney’s fees under section 57.105(7). By contrast, in Page, the Fourth DCA did not give weight to the fact that the plaintiff subsequently established standing at trial.
Florida’s Fourth DCA Confirms the One-Year Statute of Limitations for a Deficiency Action Brought Within a Foreclosure Case
On December 9, 2020, in Accardi v. Regions Bank, No. 4D20-0662, the Fourth DCA held that the one-year statute of limitations specified in section 95.11(5)(h), Fla. Stat., applies to a motion for deficiency judgment brought within an existing mortgage foreclosure action. The Court also determined the limitation period began with the issuance of the Certificate of Title.
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