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Delia v. GMAC | FL 5th DCA – "Because the bank failed to introduce any evidence on the element of adequate protection for its lost note, we reverse."

stopforeclosurefraud.com | October 20, 2014




v. Case No. 5D14-78

Opinion filed October 17, 2014

Appeal from the Circuit
Court for Orange County,

Lawrence R. Kirkwood, Judge

George M. Gingo and James E. Orth, Jr.,
Titusville, for Appellant.

Allyson L. Smith, Albertelli Law, Tampa,
for Appellee.

Dennis Delia (homeowner) appeals the final judgment of foreclosure entered by the trial court in favor of GMAC Mortgage Corporation (bank). Because the bank failed to introduce any evidence on the element of adequate protection for its lost note, we reverse.

The bank filed a complaint against the homeowner seeking foreclosure of a mortgage on real property. At trial, the bank advised the court and the homeowner that it was not in possession of the loan documents and that it intended to re-establish the note and mortgage through testimony at trial. The bank then presented testimony related to the issue of how the loan documents became lost and to the issue of the authenticity of its copies of the loan documents.

The homeowner contends that the trial court reversibly erred in concluding that the bank sustained its burden of proving that it possessed standing to proceed on its lost note theory because the bank failed to submit any evidence on the issue of adequate protection. We agree.

Section 673.3091, Florida Statutes (2013), governs the enforcement of lost notes: 673.3091. Enforcement of lost, destroyed, or stolen instrument

(1) A person not in possession of an instrument is entitled to enforce the instrument if:

(a) The person seeking to enforce the instrument was entitled to enforce the instrument when loss of possession occurred, or has directly or indirectly acquired ownership of the instrument from a person who was entitled to enforce the instrument when loss of possession occurred;

(b) The loss of possession was not the result of a transfer by the person or a lawful seizure; and

(c) The person cannot reasonably obtain possession of the instrument because the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process.

(2) A person seeking enforcement of an instrument under subsection (1) must prove the terms of the instrument and the person’s right to enforce the instrument. If that proof is made, s. 673.3081 [proof of signatures and status as holder in due course] applies to the case as if the person seeking enforcement had produced the instrument. The court may not enter judgment in favor of the person seeking enforcement unless it finds that the person required to pay the instrument is adequately protected against loss that might occur by reason of a claim by another person to enforce the instrument. Adequate protection may be provided by any reasonable means. (Emphasis added). Section 702.11(1), Florida Statutes (2013), explains the concept of adequate protection: 702.11. Adequate protections for lost, destroyed, or stolen notes in mortgage foreclosure (1) In connection with a mortgage foreclosure, the following constitute reasonable means of providing adequate protection under s. 673.3091, if so found by the court:

(a) A written indemnification agreement by a person reasonably believed sufficiently solvent to honor such an obligation;
(b) A surety bond;
(c) A letter of credit issued by a financial institution;
(d) A deposit of cash collateral with the clerk of the court; or
(e) Such other security as the court may deem appropriate under the circumstances.

Any security given shall be on terms and in amounts set by the court, for a time period through the running of the statute of limitations for enforcement of the underlying note, and conditioned to indemnify and hold harmless the maker of the note against any loss or damage, including principal, interest, and attorney fees and costs, that might occur by reason of a claim by another person to enforce the note.

In this case, the bank failed to present any evidence on the issue of adequate protection. Accordingly, we are constrained to reverse the foreclosure judgment and to remand this matter for establishment of the lost note and mortgage. See Guerrero v. Chase Home Fin., LLC, 83 So. 3d 970, 974 (Fla. 3d DCA 2012) (remanding for establishment of the lost note and mortgage when the bank failed to sustain its burden presenting evidence proving that the homeowners would be adequately protected against loss).


SAWAYA and LAMBERT, JJ., concur.


Back to October 2014 Archive

CFLA was founded by the Nation's Leading Foreclosure Defense Attorneys back in 2007 to serve the Foreclosure Defense Industry and fight pervasive Bank Fraud. Since opening our virtual doors, CFLA has rapidly expanded to become the premier online legal destination for small businesses and consumers. But as the company continues to grow, we're careful to hold true to our original vision. For us, putting the law within reach of millions of people is more than just a novel idea—it's the founding principle, just ask Andrew P. Lehman, J.D.. With convenient locations in Houston and Los Angeles, you can contact Our National Account Specialist and General Manager / Member Damion W. Emholtz at 888-758-2352 for a free Mortgage Fraud Analysis or to obtain samples of work product, including cutting edge Bloomberg Securitization Audits, Litigation Support, Quiet Title Packages, and for more information about our Nationally Accredited and U.S. Department of Education Approved "Mortgage Securitization Analyst Training Certification" Classes (3 days) 24 hours for approved CLE & MCLE Credit (Now Available Online).

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