[RPPTL-constructionlaw] Foreclosure-Related Bills Filed

Tue Oct 11 10:57:59 PDT 2011

Reese:

Regarding HB 145, "Florida Mortgage Collection Fairness Act," the remedies
seem too broad and out of place.  

Paragraph 2(a) seems to be an appropriate subject for FDUTPA, although I am
concerned about eroding protections for items offered in the context of a
judicial proceeding.  I am also not certain that "knows to be false" is the
best standard.  I can envision significant litigation over the question of
what is "known" and whether something known by one department (e.g., the
title review department) was known by an attorney making an argument before
the judge.  Is it "known" if the title review was performed by an outside,
but captive, company?  The proposed statute does not provide any guidance.

Paragraph 2(b) is a breach of contract.  The firm is not a party to the
mortgage modification agreement between the borrower and the mortgagee, so
it doesn't make sense to me to say that a "mortgage collection firm may not
. . ."  Perhaps the remedy should be attorney's fees, which could be
statutorily imported, but it is not the firm that violates Paragraph 2(b),
it is the mortgagee.  I also have a concern that mortgagees will say that
the "agreement" was not a "bona fide mortgage modification agreement,"
because of language that they will insert that says that they can back out
of the agreement (thus, with no mutuality, rendering the agreement either
voidable or void).  This simple addition to the agreement would render this
provision of the statute useless.

Paragraph 2(c) has several problems.  The mortgagee cannot "retake" what it
never had.  Furthermore, if it were to do so, it certainly would not be
deceptive.  At best, it is unfair.  Again, how can the firm violate
Paragraph 2(c)?  The mortgagee takes possession, the firm does not.  This
"violation" does not meet the condition that the firm must have violated
Paragraph 2.  There should also be a savings clause: It should be absolutely
clear that, if a foreclosure judgment, sale, and certificate of title are
vacated, then the taking of the property (and current possession) by anyone
pursuant to the issuance of the certificate of title that is now vacated
does not constitute a violation of this provision, unless the mortgage
collection firm violated Paragraph 2(a) in order to procure the now-vacated
judgment 

I would also be in favor of more specific remedies for a violation of
Paragraph (2)(c).  Perhaps the statute should provide for owner's moving
expenses (both out of and back into the subject property), rental and
related costs, reimbursement of damages for any rental agreement that the
owner must breach in order to be able to move back into his house, etc.
These may (or may not) all be "damages" under FDUTPA, but the improperly
displaced owner should be able to bring his list of expenses to a judge
without the need of an attorney, and the judge should know for what basic
expenditures the owner is entitled to receive reimbursement.  The owner will
be entitled to attorney's fees if he retains an attorney, but he probably
does not have an attorney, and he probably will not know that he is entitled
to reimbursement for his attorney's fees under the Statute.

Regarding HB 149, regarding website notice, this is a clear attempt to make
it less likely that owners will be notified of foreclosures.  Given an
epidemic of Affidavits of Diligent Search in which foreclosing firms say
they have conducted diligent searches to find and serve owners when they
clearly have not, there are significant constitutional concerns about making
it easier to hide suits from owners.  Publishing in a newspaper allows for
some (albeit small) possibility that someone will see the notice and inform
the owner.  The website approach undermines any chance of that.

Regarding HB 65, the "Foreclosure Debt Claims Act," is there a reason why
homestead property is not defined by reference to the meaning of the term
under the Florida Constitution?  I am not sure why we need yet another
definition of homestead.  

Why is "Corporation" not defined, and why is it not capitalized in Paragraph
(3)?  Is there another corporation involved in administration?  

Why is "waiver of deficiency," as used in Paragraph (5), not defined?  Can
it be conditioned?  On what?    

Assuming that all the funds have not been disbursed and the program funds
depleted, for how long after settlement may a claim be filed pursuant to
Paragraph (6)?  

Summary:  I acknowledge the evils that these Bills are aimed at combatting,
but I do not think that any of these addresses the concerns with sufficient
specificity.  With no offense meant to the drafters, I also believe that
they could be crafted better.

Scott

E. SCOTT GOLDEN, ESQUIRE
GOLDEN & LaNEVE
644 Southeast Fourth Avenue
Fort Lauderdale, Florida 33301
Tel: 954-764-6766 
Fax: 954-764-6789

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From: constructionlaw-bounces at lists.flabarrpptl.org
[mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of Reese J.
Henderson, Jr.
Sent: Friday, October 07, 2011 10:45 AM
To: RPPTL constructionlaw
Subject: [RPPTL-constructionlaw] Foreclosure-Related Bills Filed

CLC Members,

We have been asked by the RPPTL Section leadership to provide comments on
the attached proposed legislation, if we have any.  Please let me have your
comments no later than next Thursday, October 13, so that I can incorporate
them into a consolidated response.

Thanks,

Reese

Reese J. Henderson, Jr.

Board Certified Construction Attorney 

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707 Peninsular Place
Jacksonville, Florida 32204

Phone (904) 354-5200
Facsimile (904) 354-5256
 <mailto:%5Be-mail%5D> Reese.Henderson at tritthenderson.com 
 <http://www.tritthenderson.com/> www.tritthenderson.com

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