Regents Park Investments, LLC v. Bankers Lending Services, Inc.

197 So. 3d 617, 2016 Fla. App. LEXIS 11084, 2016 WL 3911219
CourtDistrict Court of Appeal of Florida
DecidedJuly 20, 2016
Docket16-0529
StatusPublished
Cited by4 cases

This text of 197 So. 3d 617 (Regents Park Investments, LLC v. Bankers Lending Services, Inc.) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Regents Park Investments, LLC v. Bankers Lending Services, Inc., 197 So. 3d 617, 2016 Fla. App. LEXIS 11084, 2016 WL 3911219 (Fla. Ct. App. 2016).

Opinion

*619 SUAREZ, C.J.

Appellant Regents Park Investments, LLC (“Regents”) appeals an Order discharging a lis pendens which it recorded on certain parcels of real property in connection with its suit for specific performance. We reverse.

Regents was the buyer and Appellee Bankers Lending Services, Inc. (“Bankers”) was the seller in a contract for five parcels of land in Miami-Dade County. The sales contract was amended with eight addenda. Addendum Number 2 contained an agreement that any liens and claims would not render the title unmarketable or preclude closing and that instead the parties could escrow funds from the proceeds pending release of the liens. Paragraph 7 of Addendum Number 8 provided the option to escrow $50,000 at closing until resolution of the liens. Paragraph 7 also required the escrow agreement to be acceptable to Old Republic National Title Insurance Co., Regents’ title insurer. The Old Republic National Title Insurance Company Commitment required lot clearing liens to be released, but did not provide for escrow in lieu of the release of those liens.

It is undisputed that the properties in question were encumbered with lot clearing liens in favor of the City of Miami. Bankers attempted to obtain release of the existing lot clearing liens by way of a suit against the lienholders. Bankers eventually entered into a settlement agreement with the lienholders under which it paid an agreed amount for release of the liens. The parties to that action also agreed to a joint stipulation and proposed order for release of the liens. The joint stipulation and proposed order were submitted to the court for approval and signature, but, as of the date of the closing, the stipulation had not been approved and the final order had not been signed by the trial court.

In light of the fact that the order was unsigned and the lot clearing liens were, therefore, still in place, Bankers was willing to have $50,000 of the purchase price placed into escrow at the closing and communicated that -willingness to Regents. Bankers also attempted to establish a time for the closing of the sale. However, Old Republic Insurance Company was unwilling to agree to the escrow arrangement in lieu of release of the liens, so Regents did not proceed with the closing. After the date for closing lapsed, Bankers sent Regents a notice stating that it had been ready willing and able to close on the closing date and that Regents, as buyer, had failed to close.

Shortly thereafter, Regents filed the present suit for specific performance and recorded the lis pendens at issue here. After discovery was undertaken, Bankers moved to discharge the lis pendens. After hearing on the motion, the trial court granted the motion for discharge. In its oral ruling the trial court stated that the correct standard for the trial court to use was “ — the one that’s articulated in the Golden Shores 1 case [ ]. Under the circum *620 stances, there’s a colorable case certainly, but I don’t think clear and convincing evidence 'has been presented to the court sufficient to overcome the motion to discharge or dissolve the lis pendens.” The trial court then dissolved the lis pendens. Regents argues, and we agree, that clear and convincing was not the proper standard for the trial court to use. However, the proper standard of proof is not entirely obvious under existing case law. Therefore, we must' first examine what is the proper standard.

As stated in Chiusolo v. Kennedy, 614 So.2d 491 (Fla.1993), a “lis pendens cannot be dissolved if, in the evidentiary hearing on request for discharge, the proponent can establish' a fair nexus between the apparent legal or equitable ownership of the property and the dispute embodied in the lawsuit..,. The’relevant question is whether alienation of the property or the imposition of intervening liens, if either actually occurred, conceivably could dis-serve the purpose^ for which lis pendens' exists.” Id. at 492.

.The question, in this case is how that “fair nexus” can be shown and what burden of proof the proponent of the lis pen-dens bears. On this issue the court in Chiusolo stated only that “the quantum of proof necessary” was not “as severe” as the substantial likelihood on the merits standard which had been imposed by the Fifth Circuit in its ruling. Id. at n. 2. In addition, in Acapulco Construction, Inc. v. Redavo Estates, Inc., 645 So.2d 182 (Fla. 3d DCA 1994) this Court held that the burden was not “the greater weight of the evidence.” See also Christian v. Sanderhoff, 731 So.2d 804, 805 (Fla. 4th DCA 1999).

In Nu-Vision, LLC v. Corporate Convenience, Inc., 965 So.2d 232 (Fla. 5th DCA 2007) the Court addressed a claim in which a tenant/proponent of a lis pendens sought review of an order granting discharge where it claimed to have an option to purchase the real property which was the subject of its lease and of an eviction action against it. In upholding the discharge order, the Court there stated:

[Establishing a ‘fair nexus’ between a claim in litigation and the property’s title requires, a little more than simply pleading a theoretical nexus.
■To establish a fair nexus requires the showing of a good faith, viable claim. In this case, [tenant] cannot make that showing because the December 16, 2004 letter cannot support an action for specific performance as a matter of law.
H* * *
[W]ith respect to the specific performance count, we find that the complaint fails to state a cause of action, and could not therefore support a finding of a ‘fair nexus’ as a matter of law.
*. ⅜ *
In our view, [ ] Chiusolo simply left unanswered the question as to the quantum of proof required of a lis pendens proponent to succeed in defending against a motion to dissolve the lis pen-dens, The Court stated only that ‘the burden of proof rests on the proponent’ and that the ‘quantum of proof is not as severe as’ the substantial likelihood of success on the merits standard necessary to maintain a temporary injunction under Florida law. The Court would not have needed to place the burden of proof on either party if there was noth *621 ing to prove — which would be the case if any allegation in a pleading that states a theoretical connection to the title in real property was sufficient to maintain a lis pendens throughout the litigation.
In our view, it would also be contrary to sound public policy to allow a lis pen-dens proponent to tie up real property belonging to another person when the proponent cannot even make a minimal showing that there is at least some basis for the underlying claim. And requiring the proponent to show that he or she has a good faith basis to allege facts supporting a claim and that the facts alleged would at least state a viable claim, if true,' is completely consistent with Chiusolo. ...
For these reasons, we have elected to follow the definition of ‘fair nexus’ adopted by the Third and Fourth Districts after

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Bluebook (online)
197 So. 3d 617, 2016 Fla. App. LEXIS 11084, 2016 WL 3911219, Counsel Stack Legal Research, https://law.counselstack.com/opinion/regents-park-investments-llc-v-bankers-lending-services-inc-fladistctapp-2016.