SCOTT L. SORENSON v. THE BANK OF NEW YORK MELLON

• Court: District Court of Appeal of Florida
• Decided: November 16, 2018
• Docket: 16-0273
• Status: Published

Opinion

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED

IN THE DISTRICT COURT OF APPEAL OF FLORIDA SECOND DISTRICT

SCOTT L. SORENSON, ) ) Appellant, ) ) v. ) Case No. 2D16-273 ) THE BANK OF NEW YORK MELLON ) f/k/a THE BANK OF NEW YORK, as ) trustee for the certificate holders ) CWALT, Inc., alternative loan trust ) 2006-OA7 mortgage pass-through ) certificates, series 2006-OA7; HAYAM ) SALAH GABR; NATIONAL CITY BANK; ) UNKNOWN TENANT NO. 1; ) UNKNOWN TENANT NO. 2; AND ALL ) UNKNOWN PARTIES CLAIMING ) INTEREST BY, THROUGH, UNDER ) OR AGAINST A NAMED DEFENDANT ) TO THIS ACTION, OR HAVING OR ) CLAIMING TO HAVE ANY RIGHT, ) TITLE OR INTEREST IN THE ) PROPERTY HEREIN DESCRIBED, ) ) Appellees. ) ___________________________________)

Opinion filed November 16, 2018.

Appeal from the Circuit Court for Collier County; Hugh D. Hayes, Judge.

Bruce Jacobs and Court E. Keeley of Jacobs Legal, PLLC, Miami, for Appellant.

William L. Grimsley and Derek K. Mountford of McGlinchey Stafford, Jacksonville; and Charles E. Stoecker, and Ralph W Confreda, Jr., of McGlinchey Stafford, Fort Lauderdale, for Appellee The Bank of New York Mellon f/k/a The Bank of New York, CWALT, Inc., alternative loan trust 2006-OA7 mortgage pass-through certificates, series 2006-OA7.

No appearance for remaining Appellees.

KHOUZAM, Judge.

Scott L. Sorenson appeals the final judgment of foreclosure entered

against him and in favor of the Bank of New York Mellon, f/k/a the Bank of New York, as

trustee for the certificate holders CWALT, Inc., alternative loan trust 2006-OA7

mortgage pass-through certificates, series 2006-OA7. We reverse and remand

because the court should have allowed Sorenson to amend his pleadings. In light of

this holding, we do not reach the remaining issues.

On October 9, 2009, the Bank of New York Mellon filed its original

foreclosure complaint against Sorenson, alleging that it was the owner and holder of a

lost note that Sorenson had failed to make payments on since January 1, 2009.

Attached to the complaint was a copy of the note, which showed that the Bank was not

the original lender and bore no endorsements. In March 2010, the Bank filed a

supplemental exhibit with a copy of the note bearing an undated, blank endorsement

signed by David Spector, as managing director of the original lender.

In December 2010, Sorenson filed an answer and affirmative defenses.

Among other claims, he denied that the endorsement and delivery of the note preceded

the filing of the suit; argued that the Bank did not have standing to foreclose; challenged

-2- the validity of the endorsement on the copy of the note filed in March 2010; and

asserted that the Bank had unclean hands because it had imposed illegal or negligent

charges on him.

The Bank filed an amended complaint in August 2013, dropping the lost

note count. Attached to the amended complaint was a copy of the note endorsed in

blank. This was the same version of the note as filed in March 2010.

In May 2015, Sorenson retained new counsel and sought to amend his

answer and affirmative defenses and to add a counterclaim reflecting new theories of

the case. The crux of the new arguments was that the evidence on which the Bank

relied to show standing had been fraudulently created and produced. Specifically,

Sorenson claimed that the Bank had added the undated endorsement during the current

litigation, had provided perjured testimony to falsely backdate the endorsement, and

had submitted a false assignment of the note and mortgage to support its timeline of

events. At the time Sorenson first sought to amend, trial was scheduled for June 2015.

The trial court denied the request to amend. The trial proceeded as scheduled but

ended in a mistrial because the Bank's witness was unavailable to complete her

testimony.

In August 2015, Sorenson again sought to amend his affirmative defenses

and counterclaims, allegedly based on the discovery of additional evidence of

misconduct. His motion was denied. And finally, the day before trial in January 2016,

Sorenson made one last request to amend his pleadings. The request was denied

based on the length of time that the case had been pending. "[I]n a seven-year-old

-3- case it's time to either settle the case or get it tried," the court stated. The trial was held,

and final judgment of foreclosure was entered.

On appeal, Sorenson argues that he should have been given the

opportunity to amend his pleadings to include his fraud defense. Florida Rule of Civil

Procedure 1.190(a) provides that "[l]eave of court [to amend pleadings] shall be given

freely when justice so requires." Behind this rule is a "[p]ublic policy favor[ing] the

liberal amendment of pleadings, and courts should resolve all doubts in favor of allowing

the amendment of pleadings to allow cases to be decided on their merit." Laurencio v.

Deutsche Bank Nat'l Trust Co., 65 So. 3d 1190, 1193 (Fla. 2d DCA 2011) (citing S.

Developers & Earthmoving, Inc. v. Caterpillar Fin. Servs. Corp., 56 So. 3d 56, 62 (Fla.

2d DCA 2011)). "A trial court's refusal to permit an amendment of a pleading is an

abuse of discretion unless it is clear that: (1) the amendment would prejudice the

opposing party, (2) the privilege to amend has been abused, or (3) the amendment

would be futile." Id. (citing S. Developers & Earthmoving, Inc., 56 So. 3d at 62-63).

Granting leave to amend is particularly appropriate where the amendment is based on

the same conduct, transaction, or occurrence from which the original claim arose and

only changes a party's legal theory of the case. See Dausman v. Hillsborough Area

Reg'l Transit, 898 So. 2d 213, 215 (Fla. 2d DCA 2005).

It is true that "[t]his liberality in granting leave to amend diminishes as the

case progresses to trial." Marquesa at Pembroke Pines Condo. Ass'n, Inc. v. Powell,

183 So. 3d 1278, 1280 (Fla. 4th DCA 2016) (alteration in original) (quoting Lasar Mfg.

Co. v. Bachanov, 436 So. 2d 236, 237-38 (Fla. 3d DCA 1983)). But even where the

motion to amend is not filed until shortly before trial, the "justice factor" can outweigh the

-4- prejudice to the opposing party caused by having to prepare for the new issue—

typically, such prejudice should be remedied with a continuance instead of the denial of

amendment. See Carib Ocean Shipping, Inc. v. Armas, 854 So. 2d 234, 236-37, 236

n.2 (Fla. 3d DCA 2003). Here, Sorenson did not wait until the eve of trial to attempt to

amend his pleadings. Though his final request was made the day before the second

trial, by that point he had already made two previous attempts to amend and those

requests had been denied.

We conclude that the court abused its discretion in denying Sorenson the

opportunity to amend to add new arguments solely because of the length of time the

action had been pending. There is no indication that the Bank would be prejudiced by

allowing amendment, especially considering the case had been pending so long in large

part due to the Bank's actions. There is also no indication that Sorenson had abused

the privilege to amend or that amendment would be futile. To resolve this case on the

merits, as the law favors, amendment should be allowed. Accordingly, we reverse and

remand with directions that the trial court permit Sorenson to amend his pleadings.

Reversed and remanded with directions.

NORTHCUTT and MORRIS, JJ., Concur.

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