LEONARD MARIO INSUA, JR., APPELLANT,
v.
LORENZO R. OTERO AND ROSALINDA OTERO, HIS WIFE, APPELLEES
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Florida appellate court reversed dismissal of defendant from foreclosure action, holding that defendant remains a necessary party where reformation of the underlying debt obligation is still pending.
A defendant in a foreclosure action cannot be dismissed as a non-party when the complaint seeks reformation of the underlying debt obligation, as the court must adjudicate the extent of the defendant's obligation.
[1] A defendant who executed an agreement for deed remains a necessary party to a foreclosure action when the complaint seeks reformation of the underlying debt obligation, e…
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Join FLexlaw to unlock all legal intelligenceInsua executed an agreement for deed to secure payment of a promissory note to the Oteros. A dispute arose over whether Insua had fully paid the amoun…
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FRANK, Judge.
Appellant Insua, the defendant below, appeals from an order of the trial court dismissing him from this lawsuit on the basis that he is not a necessary party to the Oteros’ foreclosure action. In their amended complaint the Oteros have sought reformation of an agreement for deed and promissory note and the foreclosure of an agreement for deed. Insua had executed the agreement for deed in order to secure payment of a promissory note for money owed to the Oteros, and this lawsuit arose following a dispute over whether Insua had fully paid the amounts due. During the pendency of the action, the Oteros became aware that the Internal Revenue Service had given a deed to the subject real property to the United States of America, a transaction having its genesis in a levy issued to collect unpaid taxes owed by Insua to the government. The trial court determined that In-sua retained no legal or equitable interest in the real property and accordingly dismissed him from the suit. We reverse that order. In one count of the amended complaint the Oteros seek to have the agreement for deed reformed to reflect the accurate amount Insua allegedly owes. As long as this count is pending before the trial court, it is error to dismiss Insua over his objection, especially when it appears from the record that the trial court will be called upon to adjudicate the extent of Insua’s obligation to the Oteros.
Accordingly, we reverse the order under review and remand for further proceedings consistent with this opinion.
CAMPBELL, A.C.J., and PARKER, J., concur.
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Chanrai Invs., Inc. v. Clement, 566 So. 2d 838 (Fla. 5th DCA 1990)…ase is the fact that all parties necessary for reformation were not before the court. The original grantor, Ocala Properties, and the original grantee, Ferndale, are not parties to the reformation action. The Second District Court in Insua v. Otero, 524 So. 2d 1142 (Fla. 2d DCA 1988) held that it was error to dismiss a party who had executed the instrument sought to be reformed. So, too, because Ocala Properties and Ferndale were the original grantor and grantee, they are necessary parties to an action seeking…