CENTURY GROUP, INC., A FLORIDA CORPORATION, APPELLANT,
v.
PREMIER FINANCIAL SERVICES EAST, L.P., A DELAWARE LIMITED PARTNERSHIP, APPELLEE
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Century Group appealed a trial court's denial of a protective order that would have stayed discovery in a foreclosure deficiency proceeding. The Florida appellate court reversed the denial of the protective order, holding that Premier should pursue a deficiency judgment hearing before executing on a promissory note to avoid inequitable double recovery and because prediscovery proceedings would be premature and wasteful.
A party can recover only once on the same debt. While a party may pursue both foreclosure and execution on a note, when a party has already initiated a deficiency proceeding and received a ruling that a hearing on deficiency is necessary, it has elected its remedy and must complete that proceeding before executing on the note. Discovery prior to deficiency determination is premature, potentially irrelevant, and costly.
[1] A party may not recover more than the total amount of a single debt, even if multiple judgments exist for that debt.
[2] If the proceeds from an initial collection method do not satisfy the entire debt, a party may pursue another method of collection to obtain the remaining amount.
Previewing 2 of 5 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“It is axiomatic that a party can only recover once on the same debt.”
Establishes the foundational principle limiting creditor recovery to one satisfaction of the debt regardless of multiple collection methods.
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Join FLexlaw to unlock all legal intelligencePremier Financial Services held a mortgage and guarantee on property foreclosed by its predecessor, the Resolution Trust Corporation. After foreclosur…
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QUINCE, PEGGY A., Associate Judge.
This appeal arises from the foreclosure of property on which Premier holds a mortgage and a guarantee. Because we find that under the facts of this case Premier should be not be permitted to proceed with its discovery, we reverse the trial court’s denial of the protective order. Otherwise, we affirm.
Century Group argues that Premier should be required to pursue a foreclosure deficiency hearing prior to executing on the money judgment obtained below. The question this court faces is the effect on a collection action if a party attempts to execute on a promissory note following a foreclosure sale rather than pursue the deficiency amount in a deficiency judgment hearing.
It is axiomatic that a party can only recover once on the same debt. See Flagship Bank v. Bryan, 384 So. 2d 1323 (Fla. 5th DCA 1980)(“However, the indebtedness can be collected only once, and any payment on any of the judgments must be credited to the others.”) Thus, if Premier had pursued execution of the money judgment and recovered the entire judgment amount, then it could not pursue execution of the foreclosure judgment. If Premier pursued foreclosure, and the sale amounts satisfied the judgment, then Premier could not pursue its judgment on the note. Complications arise, however, if the proceeds resulting from the initial collection method, execution on the note or foreclosure, do not satisfy the entire debt. In that circumstance, a party is required to pursue another method of collection to obtain the entire amount of the judgment.
Although a party may pursue both a foreclosure action and an execution on note, Mellor v. Goldberg, 658 So. 2d 1162 (Fla. 2d DCA 1995), typically a party will follow a foreclosure sale by initiating a deficiency hearing to obtain a deficiency judgment. In this instance, Premier is attempting to execute on the promissory note to obtain the difference between the foreclosure sale amount and the amount of the judgment. Premier’s collection efforts have the potential to result in an inequity. By executing on a promissory note and then setting-off the amount recovered at foreclosure, Premier avoids a hearing on the amount of deficiency between the foreclosure sale amount and the judgment amount pursuant to section 702.06, Florida Statutes.1 In this case, prior to Premier’s discovery efforts, its predecessor in interest, the Resolution Trust Corporation, moved for a deficiency judgment, and the trial court determined that an evidentiary hearing was necessary to determine the deficiency amount, if any, between the foreclosure sale price and the judgment. Under the circumstances of this case, where Premier has already initiated a deficiency proceeding by asking for and receiving a ruling from the trial court that it is entitled to a hearing on deficiency, Premier has elected its remedy. See Reid v. Miami Studio Properties, 139 Fla. 246,190 So. 505 (Fla.1939).
Discovery prior to a determination of a deficiency would be a potentially irrelevant and costly exercise. Once a deficiency amount has been determined, Premier may proceed with its discovery and apply any monies obtained during execution to the deficiency between the foreclosure sale amount and the judgment.
Reversed in part; affirmed in part.
PARKER, C.J., and WHATLEY, J., Concur. . The amount bid at a mortgage foreclosure sale does not conclusively establish market value of property for purposes of a deficiency decree. Fulton v. R.K. Cooper Const. Co., 208 So. 2d 863 (Fla. 3d DCA 1967).
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Farah v. Iberia Bank, 47 So. 3d 850 (Fla. 3d DCA 2010)…pose of this ruling is to prevent the circumvention of the process required to establish the right to a deficiency judgment, which prominently includes a valuation of the mortgaged property. See Century Group, Inc. v. Premier Fin. Servs. East, L.P., 724 So. 2d 661 (Fla. 2d DCA 1999). In other words, we disapprove any effort — including those already undertaken by the appellee in this case— to reach the personal assets of the mortgagor until, unless, and only to the extent that a deficiency judgment is rendere…
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Blue v. Covington Cnty. Bank, 77 So. 3d 909 (Fla. 1st DCA 2012)…the amount of a deficiency, if any, a mortgagee should not be permitted to attempt to execute on a promissory note following the foreclosure sale and before entry of a deficiency judgment. Century Group, Inc. v. Premier Financial Servs. East, L.P., 724 So. 2d 661 (Fla. 2d DCA 1999); see also Farah, 47 So. 3d at 851 (disapproving efforts to reach mortgagor’s personal assets before entry of a deficiency judgment). DISMISSED. PADOVANO, THOMAS, and SWANSON, JJ., concur.…
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Bonita Real Est. P'rs, LLC v. SLF IV Lending, L.P., 222 So. 3d 647 (Fla. 2d DCA 2017)…or damages on the note.” Hammond v. Kingsley Asset Mgmt., LLC, 144 So. 3d 673, 675 (Fla. 2d DCA 2014), However, “[i]t is axiomatic that a party can only recover once on the same debt.” Id. (quoting Century Grp., Inc. v. Premier Fin. Servs. E., L.P., 724 So. 2d 661, 662 (Fla. 2d DCA 1999)); see Royal Palm Corp. Ctr. Ass’n v. PNC Bank, N.A., 89 So. 3d 923, 933 (Fla. 4th DCA 2012) (recognizing that it is impermissible for a judgment to “simultaneously allow[ ] the plaintiff to execute on the money judgment and f…
Previewing 3 of 5 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Reid v. Miami Studio Props., Inc., 139 Fla. 246 (Fla. 1939)
- Flagship Bank OF Orlando v. Jackson Bryan, 384 So. 2d 1323 (Fla. 5th DCA 1980)
- Fulton v. R. K. Cooper Constr. Co., 208 So. 2d 863 (Fla. 3d DCA 1967)
- Mellor v. Morton A. Goldberg, 658 So. 2d 1162 (Fla. 2d DCA 1995)