CITIBANK, FSB F/K/A CITICORP SAVINGS OF FLORIDA, APPELLANT,
v.
PNC MORTGAGE CORPORATION OF AMERICA FORMERLY SEARS MORTGAGE CORPORATION; CITIZENS BANK OF CLEARWATER, BELLEAIR SANDS CONDOMINIUM ASSOCIATION, INC.; MILLER FREEMAN, INC. F/K/A GRALLA PUBLICATIONS; ANTHONY R. TALLMAN; JAMES A. HAMPSON; HOUSEHOLD BANK, F.S.B., APPELLEES
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Citibank appeals a foreclosure sale distribution order that allocated surplus proceeds to junior lienholders without determining the legal priorities among them. The appellate court reversed, holding that the trial court must prioritize all junior lienholders' claims before distributing surplus funds.
Citibank was not entitled to relief under Florida Rule of Civil Procedure 1.540(b) for failing to attend the hearing because it failed to support its claim of excusable neglect with sworn evidence. However, Citibank was entitled to relief because the trial court erred by failing to determine the priorities and amounts due to all competing junior lienholders before disbursing the surplus funds, and a lienholder's claim is not lost by mere failure to attend a disbursement hearing.
[1] A trial court must determine the priorities and amounts due to all competing junior lienholders before distributing surplus foreclosure proceeds.
[2] A junior lienholder's claim to surplus foreclosure proceeds is not lost by the mere failure to attend a disbursement hearing.
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Join FLexlaw to unlock all legal intelligence“After a foreclosure sale, the trial court is required to prioritize the interests of the competing junior lienholders and the amounts due each.”
Establishes the mandatory duty of trial courts to determine priorities among all junior lienholders before distributing surplus proceeds.
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Join FLexlaw to unlock all legal intelligenceA foreclosure sale generated $38,028.73 in surplus proceeds. Four junior lienholders—Citibank, Belleair Sands Condominium Association, Citizens Bank o…
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CASANUEVA, Judge.
In this appeal, Citibank challenges the trial court’s distribution of surplus proceeds in a foreclosure action and the trial court’s failure to vacate or reconsider the challenged order. We reverse.
Following a summary final judgment of foreclosure, a sale of the foreclosed property generated surplus proceeds of $38,028.73. Several junior lienholders, appellant Citibank, appellees Belleair Sands Condominium Association, Inc. (Belleair), Citizens Bank of Clearwater (Citizens), and Miller Freeman, Inc. (Miller), had each asserted a claim to the surplus proceeds in their responsive pleadings preceding the summary judgment of foreclosure. After the foreclosure sale, Bel-leair filed a motion to determine priorities and Citizens and Miller each filed a motion for order of distribution of surplus funds.
At the hearing on the competing motions of the junior lienholders, Belleair and Citizens relied upon previously filed affidavits of indebtedness to support each’s claim, Miller relied upon its filed evidence of claim, and Citibank did not attend although it had notice of the hearing. Following the hearing, the court entered two orders. The first, on May 15, 1997, distributed funds to Citizens and Bel-leair; the second, on May 27, 1997, distributed funds to Miller. Neither disbursed funds to Citibank, although Citibank was apparently senior to Citizens and Miller. Citibank’s motion for rehearing or other relief was heard on May 27 and the order denying the motion was signed on May 28,1997.
First, we address whether Citibank was entitled to relief under Florida Rule of Civil Procedure 1.540(b). It asserted excusable neglect for its failure to attend the hearing held upon the motions of Belleair, Citizens, and Miller. Citibank failed to support this assertion with sworn evidence. It submitted neither testimony nor affidavit. Accordingly, the trial court properly denied relief under this rule. See Lee v. Chung, 528 So. 2d 1313 (Fla. 2d DCA 1988); Pertz v. Zohar, 556 So. 2d 459 (Fla. 2d DCA 1990).
Although Citibank is not entitled to rule 1.540 relief, we conclude that it is nonetheless entitled to relief because the trial court erred by failing to entertain Citibank’s claim on rehearing and by disbursing the surplus funds without first determining the priorities and amounts due to the remaining junior lienholders. After a foreclosure sale, the trial court is required to prioritize the interests of the competing junior lienholders and the amounts due each. See Schroth v. Cape Coral Bank, 377 So. 2d 50 (Fla. 2d DCA 1979).
The rights of Citibank arose at the time of foreclosure. See United States v. Sneed, 620 So. 2d 1093 (Fla. 1st DCA 1993).
A claim is not lost by the mere failure to attend a disbursement hearing. Id. Inferior junior lienholders have no equitable claim to the surplus proceeds until superior junior lienholders have had their claims satisfied. Here, the orders disbursing the surplus funds failed to determine the legal priorities of the junior lienholders. This was error.
Accordingly, we reverse and remand for the trial court to determine the respective rights to the surplus proceeds of all junior lienholder claimants.
ALTENBERND, A.C.J., and FULMER, J., concur.
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Amado Evarito Garcia v. Stewart, 906 So. 2d 1117 (Fla. 4th DCA 2005)…even after the foreclosure sale. See Cone Bros., 193 So. at 290. “After a foreclosure sale, the trial court is required to prioritize the interests of the competing junior lienholders and the amounts due each.” Citibank, FSB v. PNC Mortgage Corp., 718 So. 2d 300, 302 (Fla. 2d DCA 1998); United States v. Sneed, 620 So. 2d 1093, 1094 (Fla. 1st DCA 1993). “[A]ny surplus remaining after a foreclosure sale should be paid to the junior lienholders in accordance with the priority of their liens on the proper [*112…
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Mathews v. Branch Banking & Tr. Co., 139 So. 3d 498 (Fla. 2d DCA 2014)…gs BB & T filed in the suit involving U.S. Bank did not satisfy this requirement.3 [*501] In interpreting the mandatory claim requirement in section 45.031(7)(b), the trial court relied on a case from this court, Citibank v. PNC Mortg. Corp. of Am., 718 So. 2d 300 (Fla. 2d DCA 1998). We conclude that the trial court’s reliance on Citibank was improper. When Citibank was issued in 1998, chapter 45, Florida Statutes (1997), did not contain the statutory language providing for a sixty-day time limit to file a cl…
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Dever v. Wells Fargo Bank Nat'l Ass'n, 147 So. 3d 1045 (Fla. 2d DCA 2014)…m for the funds within the sixty days following the sale. Wells Fargo responded in March 2013 by filing its own motion to disburse surplus funds and memorandum of law opposing the Devers’ motion. Relying on Citibank v. PNC Mortgage Corp. of America, 718 So. 2d 300 (Fla. 2d DCA 1998), Wells Fargo argued that it had timely raised a claim to the surplus in its answer. The circuit court granted Wells Fargo’s motion, denied the Devers’ motion, and ordered the funds to be disbursed to Wells Fargo. We hold that the…
Previewing 3 of 6 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Schroth v. The Cape Coral Bank, 377 So. 2d 50 (Fla. 2d DCA 1979)
- Hyun LEE and Oh Hi Lee v. Su Shin Chung and Yang Soon Chung, 528 So. 2d 1313 (Fla. 2d DCA 1988)
- Pertz v. Zohar, 556 So. 2d 459 (Fla. 2d DCA 1990)
- United States v. Heard Sneed and Willie Inez Sneed, 620 So. 2d 1093 (Fla. 1st DCA 1993)