SCOTT BLITCH AND BARBARA BLITCH, APPELLANTS,
v.
FREEDOM MORTGAGE CORPORATION, APPELLEE

Fla. 2d DCA | 2016-02-05
No. 2D14-4398
CASANUEVA and MORRIS, JJ., Concur.
185 So. 3d 645 Florida District Court of Appeal, Second District (2016) Positive Treatment
Cited by 10 cases

AI-generated. These summaries, headnotes, and key points are machine-generated and may contain errors or omissions. Always verify against the full opinion text below. Not legal advice.

Synopsis

The Blitches appealed a foreclosure judgment where the trial court reestablished a lost promissory note but failed to provide adequate protection against claims by other parties to enforce the instrument, as required by Florida Statute § 673.3091. The court reversed and remanded for the trial court to address the adequate protection requirement.


Holding

The court held that adequate protection is a post-proof condition required by statute before a court may enter judgment reestablishing a lost note. Because the trial court made no provision for adequate protection and did not determine that it was unnecessary, the judgment must be reversed and remanded for the trial court to address the means by which the Bank must satisfy this requirement.


Headnotes

[1] A court may not enter judgment reestablishing a lost instrument unless the payor is adequately protected against loss from another claim to enforce the instrument.

[2] Adequate protection for a payor against loss from another claim to enforce a lost instrument is a post-proof condition for entry of judgment, not an element of the plaint…

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Key Quotes

“The court may not enter judgment in favor of the person seeking enforcement unless it finds that the person required to pay the instrument is adequately protected against loss that might occur by reason of a claim by another person to enforce the instrument.”

Establishes the statutory requirement for adequate protection as a condition of judgment in lost note reestablishment cases.

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Facts & Procedural History

Freedom Mortgage Corporation filed a two-count complaint against the Blitches seeking to reestablish a lost promissory note and foreclose on the mortg…

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Opinion of the Court
VILLANTI, Chief Judge.

VILLANTI, Chief Judge.

Scott and Barbara Blitch seek review of the - final judgment of foreclosure entered against them and in favor of Freedom Mortgage Corporation (the Bank). We reject without -discussion the Blitches’ arguments that the Bank failed to prove that it had standing to foreclose and that the Bank failed to offer sufficient evidence to reestablish the lost note. - However, because the final judgment reestablishes the lost note without providing-adequate-protection to the -Blitches, we reverse and remand for entry of an amended final judgment that- contains such protection.

The Bank filed a two-count complaint against the Blitches seeking to reestablish a lost promissory note and to foreclose on the mortgage that secured the note. To prove its claim for reestablishing the lost note, the Bank was required to show the following:

(1) A person not in possession of an instrument is entitled to enforce the instrument if:
(a) The person seeking to enforce the instrument was .entitled to enforce the instrument when loss of possession occurred, or has directly or indirectly acquired ownership of the instrument from a person who was entitled to enforce the instrument when loss of possession occurred;
*646(b) The loss of possession was not the result of a transfer by the person or a lawful seizure; and
(c) The person cannot reasonably obtain possession of the instrument because the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process.
(2) A person seeking enforcement of an instrument under subsection (1) must prove the terms of the instrument and the person’s right to enforce the instrument. If that proof is made, s673.3081 applies to the case as if the person seeking enforcement had produced the instrument. The couH may not enter judgment in favor of the person seeking enforcement unless it finds that the person required to pay the instrument is adequately protected against loss that might occur by reason of a claim by another person to enforce the instrument. Adequate protection may be provided by any reasonable means.

§ 673.3091, Fla. Stat. (2014) (emphasis added). As this statutory language makes clear, and contrary to the Blitches’ argument here, adequate protection is not an element of the Bank’s prima facie case. Instead, it is a post-proof condition of the entry of the final judgment. See Fifth Third Bank v. Alaedin & Majdi Invs., Inc., No. 8:11-CV-2206-T-17TBM, 2012 WL 1137104, at *3 (M.D.Fla. Apr. 4, 2012) (noting that after the plaintiff showed that it was entitled to enforce the note at the time it lost the note, “the Court is required to address the issue of providing adequate protection to the defaulting party against loss that might occur if a claim were brought by another party to enforce the instrument”); see also Correa v. U.S. Bank Nat’l Ass’n, 118 So.3d 952, 956 n. 2 (Fla. 2d DCA 2013) (stating that “[iff the court is concerned that another person might attempt to enforce the original note, it may require security in favor of the payor to ensure adequate protection” (emphasis added)); Beaumont v. Bank of New York Mellon, 81 So.3d 553, 555 (Fla. 5th DCA 2012) (after discussing the deficiencies in the bank’s proof, stating “[t]he trial court was also required to address the issue of providing adequate protection to Beaumont” (emphasis added)). Because the court’s consideration of the issue of adequate protection is a condition of entering a judgment that reestablishes a lost note, its failure to provide adequate protection, or to make a finding that none is needed under the circumstances, requires reversal and remand for the court to consider the issue. See Delia v. GMAC Mortg. Corp., 161 So.3d 554, 556 (Fla. 5th DCA 2014). Generally this post-proof condition is satisfied through a written indemnification agreement in the final judgment, the posting of a surety bond, a letter of credit, a deposit of cash collateral with the court, or “[sjuch other security as the court may deem appropriate under the circumstances.” § 702.11(1)(e), Fla. Stat. (2014).

Here, the Bank proved at the bench trial that (1) it was entitled to enforce the note when the loss of possession occurred; (2) the loss of possession was not due to a valid transfer or lawful seizure; and (3) it could no longer reasonably obtain possession of the note because it was lost while in the possession of its first law firm, which is no longer in existence. The Bank also presented evidence to establish the terms of the note and that it had the right to enforce it when it was lost. This evidence was sufficient to show that the Bank was entitled to reestablishment of the lost note. However, the trial court made no provision for adequate protection of the Blitches in the final judgment, nor *647did it determine that adequate protection was unnecessary in this case. This omission requires us to reverse the. final judgment and remand for further proceedings, at which the court must address the means by which the Bank must satisfy this post-proof condition.

In this appeal, the Blitches contend that the Bank should not be allowed a “second bite at the apple” to provide evidence of the adequate protection it could provide. They contend that this court should instead simply remand for entry of judgment in their favor. However, that remedy is not compelled here and is inapposite to the plain language of the statute, which puts the burden'on the court — not the parties-1to address the issue of adequate protection. The Bank should not be penalized for the trial court’s failure to discharge its duty to address this post-proof condition of the final judgment.1

Moreover, at the bench trial, the Blitch-es did not argue that they were entitled to judgment in their favor due to the lack of any evidence of what adequate protection the Bank could provide nor did the Blitch-es request that the. court provide them with adequate protection. The Blitches may not invite error by failing to request desired relief and then use the omission of that relief to obtain a reversal of the judgment. See Downs v. State, 977 So.2d 572, 574 (Fla.2007) (“[A] party may not invite error and then be heard to complain of that error on appeal.” (quoting Cox v. State, 819 So.2d 705, 712 (Fla.2002))); see also Goodwin v. State, 751 So.2d 537, 544 n. 8 (Fla.1999). Finally, when the Blitches did point out the error on rehearing, the trial court denied the motion without hearing argument, thus denying the Bank the opportunity to, offer such protection. Given these facts, there simply is no applicability of a “second bite at the apple” argument, and the issue of adequate protection may be addressed on remand.

Accordingly, we reverse the final judgment and remand for entry of an amended final judgment that provides for adequate protection to the Blitches.' If the trial court needs to take evidence on the appropriate means of providing such protection, it may do so. ’

Reversed .and remanded for further proceedings.

CASANUEVA and MORRIS, JJ., Concur.


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Citator

Cited By

  • Brian and Cynthia Poag v. Nationstar Mortg., LLC, 198 So. 3d 1002 (Fla. 1st DCA 2016)
    …15) (citing Correa v. U.S. Bank, N.A., 118 So. 3d 952 (Fla. 2d DCA 2013)). In order to prove a claim to reestablish a lost note, the party seeking reestablishment must meet the requirements under section 673.3091. See Blitch v. Freedom Mortg. Corp., 185 So. 3d 645, 645-46 (Fla. 2d DCA 2016) (quoting § 673.3091, Fla. Stat. (2014)); see Correa, 118 So. 3d at 955 (“For the requirements to reestablish a lost note we look to section 673.3091, Florida Statutes (2007).”). Section 673.3091 provides the requirements f…
  • …utes (2015). Accordingly, we reverse the final judgment of mortgage foreclosure and remand for further proceedings, “at which the court must address the means by which the Bank must satisfy this post-proof condition.” Blitch v. Freedom Mortg. Corp., 185 So. 3d 645, 646-47 (Fla. 2d DCA 2016) (“Because the court’s consideration of the issue of adequate protection is a condition of entering a judgment that reestablishes a lost note, its failure to provide adequate protection, or to make a finding that none is ne…
  • Debish v. Wells Fargo Bank, N.A., 240 So. 3d 16 (Fla. 4th DCA 2018)
    …s that might occur due to a claim by another person to enforce the lost note, we reverse and remand with directions for the trial court to amend the judgment so as to provide adequate protection to the borrowers. See Blitch v. Freedom Mortg. Corp., 185 So. 3d 645, 646–47 (Fla. 2d DCA 2016); § 673.3091(2), Fla. Stat. (2017). “Because the court’s consideration of the issue of adequate protection is a condition of entering a judgment that reestablishes a lost note, its failure to provide adequate protection, o…

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