NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED
IN THE DISTRICT COURT OF APPEAL
OF FLORIDA
SECOND DISTRICT
ZDZISLAW JESSE ROZANSKI, ) ) Appellant, ) ) v. ) Case No. 2D16-3800 ) WELLS FARGO BANK, N.A., and HALINA ) KWIATKOWSKI, ) ) Appellees. ) )
Opinion filed June 22, 2018.
Appeal from the Circuit Court for Pinellas County; Marion L. Fleming, Judge.
Alexander Allred of Castle Law Group, P.A., Largo, for Appellant.
Martin S. Awerbach and Michael A. Cohn of Awerbach | Cohn, Clearwater, for Appellee Wells Fargo Bank, N.A.
No appearance for remaining Appellee.
MORRIS, Judge.
Zdzislaw Rozanski appeals a partial summary judgment entered in favor
of Wells Fargo Bank, N.A., imposing and foreclosing an equitable lien against
Rozanski's real property. Rozanski argues that the trial court erred in allowing Wells Fargo to foreclose on the equitable lien because Wells Fargo did not show that
Rozanski was in default on the loan from which the lien arose. We agree and reverse
the decision of the trial court on the issue of foreclosure.
I. Facts
In 2002 Rozanski purchased the property that is the subject of this case.
That same year, he married Halina Kwiatkowski. In 2003 he executed a note with Wells
Fargo in the amount of $273,000, which was secured by a mortgage on the property.
Both the mortgage and the note were in his name alone.
In 2007 Kwiatkowski filed for divorce from Rozanski. A final judgment of
dissolution was entered in 2008, pursuant to a marital settlement agreement, granting
Kwiatkowski sole possession of the property, and a quit claim deed was executed in her
favor. Also in 2008, Kwiatkowksi refinanced the property through a loan with Wells
Fargo in the amount of $370,000, which was secured by a mortgage. A portion of this
money was used to pay off the balance of Rozanski's mortgage, $321,042, and Wells
Fargo issued a release of Rozanski's mortgage.
In 2012 Wells Fargo filed a complaint for mortgage foreclosure against
Kwiatkowski. In 2014 Wells Fargo added Rozanski as a defendant. He answered,
alleging that the quit claim deed conveying ownership to Kwiatkowksi was a forgery. In
the dissolution case, Rozanski obtained a judgment setting aside the final judgment of
dissolution based on fraud upon the court. In the meantime, Wells Fargo amended its
complaint to allege a count to impose and foreclose an equitable lien against Rozanski's
property, "under principles of subrogation," in the amount of the payoff of Rozanski's
mortgage. In response to the final judgment setting aside the dissolution of marriage,
-2- Wells Fargo filed a motion for summary judgment, proceeding solely on its count to
impose and foreclose an equitable lien.
After a hearing, the trial court granted Wells Fargo's motion and entered a
final judgment imposing and foreclosing an equitable lien. The trial court ruled that
Wells Fargo "is entitled to impose and foreclose the Equitable Lien against the Property
in the Prior Mortgage Payoff amount of $321,042.02, based upon subrogation," citing
Tribeca Lending Corp. v. Real Estate Depot, Inc., 42 So. 3d 258 (Fla. 4th DCA 2010).
II. Analysis
On appeal, Rozanski contends that Wells Fargo had no legal or equitable
basis to foreclose on the equitable lien, although he does not "take issue with the
existence of the equitable lien." He argues that Wells Fargo was not entitled to
foreclose on the equitable lien because he was never in default on his mortgage.
Equitable liens may be imposed to prevent unjust enrichment. See Palm
Bch. Sav. & Loan Ass'n v. Fishbein, 619 So. 2d 267, 270 (Fla. 1993); Tribeca Lending
Corp., 42 So. 3d at 262. "[T]he doctrine of equitable subrogation, a twin remedy to the
equitable lien, is designed to apply where the claimant satisfied an obligation of another
and then stands in the shoes of the satisfied creditor." Tribeca Lending Corp., 42 So.
3d at 262. "As a result of equitable subrogation, the party discharging the debt . . .
succeeds to the right and priorities of the original creditor." Dade Cty. Sch. Bd. v. Radio
Station WQBA, 731 So. 2d 638, 646 (Fla. 1999).
Because Wells Fargo discharged Rozanski's debt when Kwiatkowski
obtained her loan in 2008, Wells Fargo succeeded to the rights and priorities it had as
Rozanski's original lender and mortgagee. Therefore, Wells Fargo was entitled to the
-3- equitable lien, which Rozanski does not dispute. However, Wells Fargo was entitled to
only the rights and priorities that it had at the time it satisfied Rozanski's mortgage in
2008, and Wells Fargo did not plead or demonstrate below that it had the right to
foreclose on Rozanski's mortgage in 2008.
Wells Fargo argues that foreclosure of the equitable lien was proper
pursuant to the decision in Fishbein, 619 So. 2d 267. In Fishbein, the husband
borrowed $1,200,000, secured by a mortgage on the homestead property, but he forged
his wife's signature on the mortgage. Id. at 268. The loan proceeds were used to pay
off three prior mortgages on the property in the amount of $930,000. Then the
mortgage went into default, and the bank commenced foreclosure proceedings. Id. at
269. The parties divorced, and the wife was awarded the house. The trial court ruled
that the mortgage could not be enforced against the house but that the bank was
entitled to an equitable lien. The supreme court agreed that the bank was entitled to an
equitable lien in the amount of $930,000. Id. at 270-71.
The court reasoned that an equitable lien was appropriate because the
wife stood "in no worse position than she stood before the execution of the mortgage,"
noting that "[w]hen the bank made its loan, one of the prior mortgages was already
overdue" and that the parties could not pay the prior mortgages. Id. Wells Fargo relies
on the fact that only one of the three prior mortgages was in default in Fishbein as
support for its argument "that being in default is not a required element for the . . .
foreclosure of the equitable lien." On the other hand, Rozanski argues that the bank
could only foreclose on the equitable lien in Fishbein because at least one mortgage
was overdue in that case, whereas in this case there was no evidence that Rozanski
-4- was overdue on his mortgage. However, as we read Fishbein, the court did not decide
the issue of whether the bank was entitled to foreclose on the equitable lien.1 Rather,
the court focused solely on whether the bank was entitled to imposition of an equitable
lien where the wife claimed a homestead interest and had not engaged in any
misconduct herself.
We also note that the facts of this case are distinguishable from Tribeca
Lending Corp., 42 So. 3d 258, which the trial court cited in its judgment. The party
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NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED
IN THE DISTRICT COURT OF APPEAL
OF FLORIDA
SECOND DISTRICT
ZDZISLAW JESSE ROZANSKI, ) ) Appellant, ) ) v. ) Case No. 2D16-3800 ) WELLS FARGO BANK, N.A., and HALINA ) KWIATKOWSKI, ) ) Appellees. ) )
Opinion filed June 22, 2018.
Appeal from the Circuit Court for Pinellas County; Marion L. Fleming, Judge.
Alexander Allred of Castle Law Group, P.A., Largo, for Appellant.
Martin S. Awerbach and Michael A. Cohn of Awerbach | Cohn, Clearwater, for Appellee Wells Fargo Bank, N.A.
No appearance for remaining Appellee.
MORRIS, Judge.
Zdzislaw Rozanski appeals a partial summary judgment entered in favor
of Wells Fargo Bank, N.A., imposing and foreclosing an equitable lien against
Rozanski's real property. Rozanski argues that the trial court erred in allowing Wells Fargo to foreclose on the equitable lien because Wells Fargo did not show that
Rozanski was in default on the loan from which the lien arose. We agree and reverse
the decision of the trial court on the issue of foreclosure.
I. Facts
In 2002 Rozanski purchased the property that is the subject of this case.
That same year, he married Halina Kwiatkowski. In 2003 he executed a note with Wells
Fargo in the amount of $273,000, which was secured by a mortgage on the property.
Both the mortgage and the note were in his name alone.
In 2007 Kwiatkowski filed for divorce from Rozanski. A final judgment of
dissolution was entered in 2008, pursuant to a marital settlement agreement, granting
Kwiatkowski sole possession of the property, and a quit claim deed was executed in her
favor. Also in 2008, Kwiatkowksi refinanced the property through a loan with Wells
Fargo in the amount of $370,000, which was secured by a mortgage. A portion of this
money was used to pay off the balance of Rozanski's mortgage, $321,042, and Wells
Fargo issued a release of Rozanski's mortgage.
In 2012 Wells Fargo filed a complaint for mortgage foreclosure against
Kwiatkowski. In 2014 Wells Fargo added Rozanski as a defendant. He answered,
alleging that the quit claim deed conveying ownership to Kwiatkowksi was a forgery. In
the dissolution case, Rozanski obtained a judgment setting aside the final judgment of
dissolution based on fraud upon the court. In the meantime, Wells Fargo amended its
complaint to allege a count to impose and foreclose an equitable lien against Rozanski's
property, "under principles of subrogation," in the amount of the payoff of Rozanski's
mortgage. In response to the final judgment setting aside the dissolution of marriage,
-2- Wells Fargo filed a motion for summary judgment, proceeding solely on its count to
impose and foreclose an equitable lien.
After a hearing, the trial court granted Wells Fargo's motion and entered a
final judgment imposing and foreclosing an equitable lien. The trial court ruled that
Wells Fargo "is entitled to impose and foreclose the Equitable Lien against the Property
in the Prior Mortgage Payoff amount of $321,042.02, based upon subrogation," citing
Tribeca Lending Corp. v. Real Estate Depot, Inc., 42 So. 3d 258 (Fla. 4th DCA 2010).
II. Analysis
On appeal, Rozanski contends that Wells Fargo had no legal or equitable
basis to foreclose on the equitable lien, although he does not "take issue with the
existence of the equitable lien." He argues that Wells Fargo was not entitled to
foreclose on the equitable lien because he was never in default on his mortgage.
Equitable liens may be imposed to prevent unjust enrichment. See Palm
Bch. Sav. & Loan Ass'n v. Fishbein, 619 So. 2d 267, 270 (Fla. 1993); Tribeca Lending
Corp., 42 So. 3d at 262. "[T]he doctrine of equitable subrogation, a twin remedy to the
equitable lien, is designed to apply where the claimant satisfied an obligation of another
and then stands in the shoes of the satisfied creditor." Tribeca Lending Corp., 42 So.
3d at 262. "As a result of equitable subrogation, the party discharging the debt . . .
succeeds to the right and priorities of the original creditor." Dade Cty. Sch. Bd. v. Radio
Station WQBA, 731 So. 2d 638, 646 (Fla. 1999).
Because Wells Fargo discharged Rozanski's debt when Kwiatkowski
obtained her loan in 2008, Wells Fargo succeeded to the rights and priorities it had as
Rozanski's original lender and mortgagee. Therefore, Wells Fargo was entitled to the
-3- equitable lien, which Rozanski does not dispute. However, Wells Fargo was entitled to
only the rights and priorities that it had at the time it satisfied Rozanski's mortgage in
2008, and Wells Fargo did not plead or demonstrate below that it had the right to
foreclose on Rozanski's mortgage in 2008.
Wells Fargo argues that foreclosure of the equitable lien was proper
pursuant to the decision in Fishbein, 619 So. 2d 267. In Fishbein, the husband
borrowed $1,200,000, secured by a mortgage on the homestead property, but he forged
his wife's signature on the mortgage. Id. at 268. The loan proceeds were used to pay
off three prior mortgages on the property in the amount of $930,000. Then the
mortgage went into default, and the bank commenced foreclosure proceedings. Id. at
269. The parties divorced, and the wife was awarded the house. The trial court ruled
that the mortgage could not be enforced against the house but that the bank was
entitled to an equitable lien. The supreme court agreed that the bank was entitled to an
equitable lien in the amount of $930,000. Id. at 270-71.
The court reasoned that an equitable lien was appropriate because the
wife stood "in no worse position than she stood before the execution of the mortgage,"
noting that "[w]hen the bank made its loan, one of the prior mortgages was already
overdue" and that the parties could not pay the prior mortgages. Id. Wells Fargo relies
on the fact that only one of the three prior mortgages was in default in Fishbein as
support for its argument "that being in default is not a required element for the . . .
foreclosure of the equitable lien." On the other hand, Rozanski argues that the bank
could only foreclose on the equitable lien in Fishbein because at least one mortgage
was overdue in that case, whereas in this case there was no evidence that Rozanski
-4- was overdue on his mortgage. However, as we read Fishbein, the court did not decide
the issue of whether the bank was entitled to foreclose on the equitable lien.1 Rather,
the court focused solely on whether the bank was entitled to imposition of an equitable
lien where the wife claimed a homestead interest and had not engaged in any
misconduct herself.
We also note that the facts of this case are distinguishable from Tribeca
Lending Corp., 42 So. 3d 258, which the trial court cited in its judgment. The party
seeking the imposition and foreclosure of the equitable lien in that case, Tribeca
Lending Corp., had paid off a prior mortgage, but that prior mortgage was in default and
a foreclosure judgment had been entered. 42 So. 3d at 260-61. Thus, Tribeca Lending
Corp. was entitled to foreclose on the equitable lien in the same way the original lender
was entitled to foreclose on the mortgage. Here, there was no showing that Rozanski
was in default on his mortgage or that Wells Fargo was entitled to foreclose on the
mortgage at the time it satisfied Rozanski's debt with the refinancing in 2008. See
Brotheridge v. Option One Mortg. Corp., 67 So. 3d 254, 256 (Fla. 2d DCA 2010) (noting
that foreclosure of equitable lien would not be proper where debtors were not given an
opportunity to make payment on the lien amount and there was no proof of any default
by the debtors on their earlier obligations).
Because there was no showing that Rozanski was in default on his
mortgage in 2008, the trial court erred in ordering the foreclosure of the equitable lien.
1The court noted that the trial court had "stayed any foreclosure sale on the equitable lien for six months to permit [the wife] to try to make a private sale of the house." Fishbein, 619 So. 2d at 269. There was no other discussion regarding foreclosure of the equitable lien.
-5- We affirm the imposition of the equitable lien against Rozanski's property, but we
reverse the final summary judgment to the extent that it orders foreclosure of that lien.
Affirmed in part, reversed in part, and remanded.
BADALAMENTI and ROTHSTEIN-YOUAKIM, JJ., Concur.
-6-