Third District Court of Appeal State of Florida
Opinion filed December 19, 2018. Not final until disposition of timely filed motion for rehearing.
________________
No. 3D17-2469 Lower Tribunal No. 10-22236 ________________
CitiMortgage, Inc., Appellant,
vs.
Jorge Porter, et al., Appellees.
An Appeal from the Circuit Court for Miami-Dade County, Thomas J. Rebull, Judge.
Akerman and Nancy M. Wallace (Tallahassee) and William P. Heller (Fort Lauderdale) and Eric M. Levine (West Palm Beach), for appellant.
The Ticktin Law Group and Kendrick Almaguer (Deerfield Beach); Krinzman Huss & Lubetsky and Cary A. Lubetsky and Lynette Ebeoglu McGuinness; Pila Law Group and Tomas A. Pila, for appellees.
Before ROTHENBERG, C.J., and SALTER and LINDSEY, JJ.
SALTER, J. CitiMortgage, Inc. (“CitiMortgage”), appeals a final summary judgment in
favor of Sun West Mortgage Company, Inc. (“Sun West”), regarding the relative
priority of the parties’ respective mortgage liens. CitiMortgage’s mortgage was
recorded before Sun West’s reverse mortgage, but a series of suspicious documents
and occurrences called that priority into question. Concluding that Sun West “was
a bona fide purchaser for value without notice of any alleged irregularities in the
public record chain of title,” and that CitiMortgage was “in the best position to
correct the official records and is the least innocent,” the trial court granted Sun
West’s motion for final summary judgment. For the reasons which follow, we
reverse.
I. Facts; Proceedings in the Circuit Court
A. CitiMortgage
In 2005, appellee Jorge Porter (“Porter”) executed a promissory note and
first mortgage encumbering his residence. The mortgage was duly recorded, as
were a later loan modification agreement and various assignments culminating in
an assignment to CitiMortgage.
In 2010, CitiMortgage’s attorneys at the time, David J. Stern, P.A., filed the
circuit court foreclosure action involved in the present appeal, and a lis pendens. A
year later, Stern withdrew as counsel and CitiMortgage’s present counsel were
substituted. But in 2011, two months after Stern’s withdrawal, the Stern firm
2 allegedly executed a “Notice of Voluntary Dismissal with Prejudice and Release of
Lis Pendens.” The notice did not appear on the electronic docket at that time, but
the docket does reflect a voluntary dismissal on June 8, 2012, and the signed notice
and release of lis pendens was recorded in the public records on the same date.
And in the interim, on February 6, 2012, a satisfaction of mortgage
purportedly executed in October 2009 by one of the interim mortgagees of record
(by assignment)—not by CitiMortgage—was recorded in the public records. The
borrower and mortgagor, Porter, paid the recording fee for the satisfaction.1
On June 26, 2012, CitiMortgage moved to “strike the notice of dismissal
recorded on June 8, 2012 or . . . vacate the notice of dismissal.” CitiMortgage
contended “the notice of dismissal was not authorized by [CitiMortgage] and
should not have any prospective application . . . [because] it is clear that the notice
of dismissal was improperly recorded, it should be stricken, or in the alternative,
vacated by this Court.”
On July 10, 2012, the trial court entered an order granting CitiMortgage’s
motion, providing “[t]he notice of voluntary dismissal recorded on June 8, 2012,
shall have no further force or effect.” CitiMortgage did not record the trial court’s
1 The purported satisfaction carried an execution and notarization date of October 30, 2009, some five months before CitiMortgage commenced its foreclosure action. The document was not filed for recording by Porter until over two years after that date of execution, and 22 months after the CitiMortgage foreclosure commenced.
3 order. CitiMortgage claims “[t]he original order disappeared from the court file—
which is why it was never recorded and why the record on the appeal needed to be
supplemented with a conformed copy.”
B. Sun West; Amended Foreclosure Complaint
In May 2012, Porter’s mother applied for a reverse mortgage loan on
Porter’s residence, which was actually still owned by Porter and the subject of an
active foreclosure case. Porter conveyed the residence to his Mother on June 13,
2012. The reverse mortgage loan closed on August 21, 2012, six weeks after the
trial court’s order vacating the dismissal of CitiMortgage’s foreclosure action. The
reverse mortgage was recorded in September 2012, and an assignment of that
mortgage to Sun West was recorded in November 2012.
In 2014, CitiMortgage amended its foreclosure complaint to add Sun West
and the assignor of the mortgage to Sun West as defendants. Sun West’s answer
and affirmative defenses alleged: (1) Sun West was a bona fide lender for value
without notice of CitiMortgage’s mortgage lien as of the time the Sun West
mortgage closed; (2) CitiMortgage’s lien is barred as “between two innocent
parties, the one who caused or allowed or could have avoided the loss, must bear
responsibility for the loss”; and (3) CitiMortgage is estopped from bringing its
claim of priority against Sun West.
4 Sun West moved for summary judgment, based on the recorded satisfaction
of CitiMortgage’s mortgage among the public records and on CitiMortgage’s
failure to record the trial court’s order vacating the voluntary dismissal and
discharging the lis pendens. CitiMortgage opposed the motion, filing an affidavit
of a CitiMortgage officer attesting that CitiMortgage had never satisfied or
released the Porter mortgage. CitiMortgage also filed an affidavit of the lead
general counsel of Nationwide Title Clearing, Inc. (“NTC”), shown in the
“Document Prepared By” entries on the recorded satisfaction of the Porter
mortgage. NTC’s affiant conducted an investigation of the alleged satisfaction of
mortgage and concluded that the satisfaction was not in fact “prepared or sent for
recording by NTC.”2 The affiant observed that a postal ZIP Code for NTC’s
address contained an extra digit, a format “which does not exist and could not print
out on any of NTC’s forms.”
CitiMortgage also submitted summary judgment evidence in the form of
deposition excerpts from a representative of the Stern law firm, stating that the
firm did not prepare the notice of voluntary dismissal. Finally, CitiMortgage filed
2 The NTC counsel and affiant noted, for example, that the supposed satisfaction of mortgage was notarized in Miami-Dade County, though NTC has no physical presence and has not signed documents there, as NTC’s authorized agents in Florida are required to sign in the presence of a Pinellas County Notary, where NTC is located.
5 the Miami-Dade Clerk of Court records department receipts indicating that Porter
recorded the satisfaction of mortgage himself.
The trial court granted Sun West’s motion for final summary judgment,
concluding that as between the two parties, CitiMortgage was the “least innocent”
and thus required to bear the loss. This appeal followed.
II. Analysis
We review an order granting a motion for summary judgment de novo.
Volusia County. v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126, 130 (Fla.
2000).
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Third District Court of Appeal State of Florida
Opinion filed December 19, 2018. Not final until disposition of timely filed motion for rehearing.
________________
No. 3D17-2469 Lower Tribunal No. 10-22236 ________________
CitiMortgage, Inc., Appellant,
vs.
Jorge Porter, et al., Appellees.
An Appeal from the Circuit Court for Miami-Dade County, Thomas J. Rebull, Judge.
Akerman and Nancy M. Wallace (Tallahassee) and William P. Heller (Fort Lauderdale) and Eric M. Levine (West Palm Beach), for appellant.
The Ticktin Law Group and Kendrick Almaguer (Deerfield Beach); Krinzman Huss & Lubetsky and Cary A. Lubetsky and Lynette Ebeoglu McGuinness; Pila Law Group and Tomas A. Pila, for appellees.
Before ROTHENBERG, C.J., and SALTER and LINDSEY, JJ.
SALTER, J. CitiMortgage, Inc. (“CitiMortgage”), appeals a final summary judgment in
favor of Sun West Mortgage Company, Inc. (“Sun West”), regarding the relative
priority of the parties’ respective mortgage liens. CitiMortgage’s mortgage was
recorded before Sun West’s reverse mortgage, but a series of suspicious documents
and occurrences called that priority into question. Concluding that Sun West “was
a bona fide purchaser for value without notice of any alleged irregularities in the
public record chain of title,” and that CitiMortgage was “in the best position to
correct the official records and is the least innocent,” the trial court granted Sun
West’s motion for final summary judgment. For the reasons which follow, we
reverse.
I. Facts; Proceedings in the Circuit Court
A. CitiMortgage
In 2005, appellee Jorge Porter (“Porter”) executed a promissory note and
first mortgage encumbering his residence. The mortgage was duly recorded, as
were a later loan modification agreement and various assignments culminating in
an assignment to CitiMortgage.
In 2010, CitiMortgage’s attorneys at the time, David J. Stern, P.A., filed the
circuit court foreclosure action involved in the present appeal, and a lis pendens. A
year later, Stern withdrew as counsel and CitiMortgage’s present counsel were
substituted. But in 2011, two months after Stern’s withdrawal, the Stern firm
2 allegedly executed a “Notice of Voluntary Dismissal with Prejudice and Release of
Lis Pendens.” The notice did not appear on the electronic docket at that time, but
the docket does reflect a voluntary dismissal on June 8, 2012, and the signed notice
and release of lis pendens was recorded in the public records on the same date.
And in the interim, on February 6, 2012, a satisfaction of mortgage
purportedly executed in October 2009 by one of the interim mortgagees of record
(by assignment)—not by CitiMortgage—was recorded in the public records. The
borrower and mortgagor, Porter, paid the recording fee for the satisfaction.1
On June 26, 2012, CitiMortgage moved to “strike the notice of dismissal
recorded on June 8, 2012 or . . . vacate the notice of dismissal.” CitiMortgage
contended “the notice of dismissal was not authorized by [CitiMortgage] and
should not have any prospective application . . . [because] it is clear that the notice
of dismissal was improperly recorded, it should be stricken, or in the alternative,
vacated by this Court.”
On July 10, 2012, the trial court entered an order granting CitiMortgage’s
motion, providing “[t]he notice of voluntary dismissal recorded on June 8, 2012,
shall have no further force or effect.” CitiMortgage did not record the trial court’s
1 The purported satisfaction carried an execution and notarization date of October 30, 2009, some five months before CitiMortgage commenced its foreclosure action. The document was not filed for recording by Porter until over two years after that date of execution, and 22 months after the CitiMortgage foreclosure commenced.
3 order. CitiMortgage claims “[t]he original order disappeared from the court file—
which is why it was never recorded and why the record on the appeal needed to be
supplemented with a conformed copy.”
B. Sun West; Amended Foreclosure Complaint
In May 2012, Porter’s mother applied for a reverse mortgage loan on
Porter’s residence, which was actually still owned by Porter and the subject of an
active foreclosure case. Porter conveyed the residence to his Mother on June 13,
2012. The reverse mortgage loan closed on August 21, 2012, six weeks after the
trial court’s order vacating the dismissal of CitiMortgage’s foreclosure action. The
reverse mortgage was recorded in September 2012, and an assignment of that
mortgage to Sun West was recorded in November 2012.
In 2014, CitiMortgage amended its foreclosure complaint to add Sun West
and the assignor of the mortgage to Sun West as defendants. Sun West’s answer
and affirmative defenses alleged: (1) Sun West was a bona fide lender for value
without notice of CitiMortgage’s mortgage lien as of the time the Sun West
mortgage closed; (2) CitiMortgage’s lien is barred as “between two innocent
parties, the one who caused or allowed or could have avoided the loss, must bear
responsibility for the loss”; and (3) CitiMortgage is estopped from bringing its
claim of priority against Sun West.
4 Sun West moved for summary judgment, based on the recorded satisfaction
of CitiMortgage’s mortgage among the public records and on CitiMortgage’s
failure to record the trial court’s order vacating the voluntary dismissal and
discharging the lis pendens. CitiMortgage opposed the motion, filing an affidavit
of a CitiMortgage officer attesting that CitiMortgage had never satisfied or
released the Porter mortgage. CitiMortgage also filed an affidavit of the lead
general counsel of Nationwide Title Clearing, Inc. (“NTC”), shown in the
“Document Prepared By” entries on the recorded satisfaction of the Porter
mortgage. NTC’s affiant conducted an investigation of the alleged satisfaction of
mortgage and concluded that the satisfaction was not in fact “prepared or sent for
recording by NTC.”2 The affiant observed that a postal ZIP Code for NTC’s
address contained an extra digit, a format “which does not exist and could not print
out on any of NTC’s forms.”
CitiMortgage also submitted summary judgment evidence in the form of
deposition excerpts from a representative of the Stern law firm, stating that the
firm did not prepare the notice of voluntary dismissal. Finally, CitiMortgage filed
2 The NTC counsel and affiant noted, for example, that the supposed satisfaction of mortgage was notarized in Miami-Dade County, though NTC has no physical presence and has not signed documents there, as NTC’s authorized agents in Florida are required to sign in the presence of a Pinellas County Notary, where NTC is located.
5 the Miami-Dade Clerk of Court records department receipts indicating that Porter
recorded the satisfaction of mortgage himself.
The trial court granted Sun West’s motion for final summary judgment,
concluding that as between the two parties, CitiMortgage was the “least innocent”
and thus required to bear the loss. This appeal followed.
II. Analysis
We review an order granting a motion for summary judgment de novo.
Volusia County. v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126, 130 (Fla.
2000). We consider the summary judgment evidence in the light most favorable to
the non-moving party, indulging any reasonable inferences in favor of that party.
Rocamonde v. Marshalls of MA, Inc., 56 So. 3d 863, 864 (Fla. 3d DCA 2011).
Sun West contends that the affidavit of the attorney who served as closing
agent for the Sun West loan is dispositive. Her affidavit describes her title search
and her review of a title commitment from a title insurer. She states that (a) the
title insurer did not list the CitiMortgage mortgage on its June 18, 2012,
commitment, and (b) no one told her, prior to or during the closing on August 21,
2012, that the satisfaction of the CitiMortgage lien or the dismissal with prejudice
and release of the CitiMortgage lis pendens “were incorrect or had been
improperly recorded.”
6 Also in the record, however, were a number of suspicious entries and
occurrences placing Sun West and its originator/underwriter, on notice of
irregularities. First, the purported satisfaction of the CitiMortgage lien, dated
October 30, 2009, was recorded February 6, 2012, and was not executed by an
officer or agent of CitiMortgage. Between the date of the supposed execution (by
Mortgage Electronic Registration Systems, Inc., or “MERS”) of the satisfaction,
and the recordation of the purported satisfaction over two years later, an
assignment of the same note and mortgage was recorded. The assignment was
dated August 18, 2010, recorded September 14, 2010, supposedly prepared by
David J. Stern, Esq., and assigned the note and mortgage from MERS to
CitiMortgage. The satisfaction of the mortgage in 2009 is inconsistent with the
assignment of the note and mortgage nearly a year later.
Second, when the closing agent referred in her affidavit to “public records,”
she did not limit the term to “Official Records,” used to refer only to a county
clerk’s register of recorded documents by “O.R. Book and Page.” The electronic
docket and documents annexed to the docket are also public records. Any review
of the docket of the 2010 CitiMortgage foreclosure case would have shown another
inconsistency—a motion by CitiMortgage to vacate the voluntary dismissal and
release of lis pendens filed only 18 days after it was recorded, and an order on that
motion (and thereby reinstating the lis pendens) docketed July 10, 2012.
7 The docket would have further disclosed that David Stern withdrew as
CitiMortgage’s counsel, and another firm was substituted in Stern’s firm’s place,
two months before his firm supposedly executed the notice of voluntary dismissal
and release of lis pendens, and over a year before that notice and release was
recorded. It would also have disclosed that substantial prosecution and progress
toward foreclosure continued to occur well after the purported satisfaction and
voluntary dismissal were executed.
Third, the purported notice of voluntary dismissal dated in March 2011—
after the withdrawal of the alleged attorney and firm who signed it—carried no
certificate of service indicating service on counsel or delivery to CitiMortgage
(which executed an affidavit stating that such a document was never received by
CitiMortgage).3
Fourth and finally, Porter certainly had knowledge that he was still a
defendant in the CitiMortgage foreclosure case, yet apparently never disclosed to
his own Mother, or his Mother’s lender, that they would be buying their way into a
lawsuit if they closed the loan to his Mother in 2012. The loan closing occurred in
August 2012, well after the docket entries in the electronic, readily-available
online records of the CitiMortgage foreclosure.
3 The purported notice also bears no electronic date/time filing information for filing with the Circuit Court in March 2011; someone simply recorded it in the Official Book fifteen months later (June 2012).
8 Porter’s quitclaim deed to his Mother during the pendency of the foreclosure
case and his own personal recordation of the purported satisfaction of mortgage
over two years after it was supposedly executed (an act denied in the affidavit of
NTC, the entity identified as the preparer) are additional indicia of bad faith on the
part of Porter.
This summary judgment evidence creates triable, genuine issues of material
fact. In Lloyd v. Chicago Title Insurance Co., 576 So. 2d 310, 311 (Fla. 3d DCA
1990), this Court held that “the recording of a void or forged instrument cannot
create legal title or protect those who may claim under it.” (Citing McCoy v. Love,
382 So. 2d 647 (Fla. 1997), and three earlier Florida cases). On this record, the
single-page notice of voluntary dismissal and release of lis pendens was executed
and recorded without authorization by, or notice to, CitiMortgage. Moreover,
there was summary judgment evidence that the purported satisfaction of mortgage
was not prepared by an employee of NTC and was not signed by an authorized
representative of CitiMortgage.
Additional evidence of chicanery, even if by a person or persons as yet
unidentified, is found in this record. Someone removed the predecessor trial
judge’s order of July 10, 2012, from the official court records between the time the
trial judge signed it and the time “Order on Motion to Strike” was entered on the
electronic docket (but without the usual pdf copy of the order as part of the entry).
9 In addition, an attorney from the Stern law firm testified that, at the date of the
purported (and subsequently-stricken) notice of voluntary dismissal and release of
lis pendens, the Stern law firm was “downsizing,” “winding down,” and not doing
that kind of work on the dates that the document was signed or recorded. He
testified:
[A]fter March 31st, 2011, the only thing the law firm did was withdraw from cases. We weren’t representing any clients. We had no authority to file something like this and to my knowledge no attorney with the firm at that point between March and June and there were only a handful of attorneys maybe five and he was not one of were filing motions to withdraw our cases. [Sic].
Our decision in Lloyd, which itself reversed a summary judgment in favor of
a subsequent mortgagee relying on a fraudulent instrument, applies to this record.
A factfinder could determine, though we do not decide the point at this juncture,
that a fraudulent or “intervening criminal act” induced Sun West’s detrimental
reliance. Lloyd, 576 So. 2d at 311.
Reversed and remanded for further proceedings.
ANY POST-OPINION MOTION MUST BE FILED WITHTIN SEVEN DAYS. A RESPONSE TO THE POST-OPINON MOTION MAY BE FILED WITHIN FIVE DAYS THEREAFTER.