Sarit J. Assil n/k/a Sarit Levy v. Aurora Loan Services, LLC, Soheil Assil, etc., Victoria Grove Homeowners Associaton, Inc., John Doe and Jane Doe, etc.

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT

SARIT J. ASSIL n/k/a SARIT LEVY,
Appellant,

v.

AURORA LOAN SERVICES, LLC, SOHEIL ASSIL, and any and all
unknown parties claiming by, through, under, and against the herein
named individual defendant(s) who are not known to be dead or alive,
whether said unknown parties may claim an interest as spouses, heirs,
devises, grantees or other claimants, VICTORIA GROVE HOMEOWNERS
ASSOCIATION, INC., JOHN DOE and JANE DOE, as unknown tenants
in possession,
Appellees.

No. 4D14-2257

[ August 12, 2015 ]

Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Howard H. Harrison, Senior Judge; L.T. Case No.
502008CA025998XXXXMB.

Craig A. Boudreau, Wellington, for appellant.

Nancy M. Wallace of Akerman LLP, Tallahassee, William P. Heller of
Akerman LLP, Fort Lauderdale, and Celia C. Falzone of Akerman LLP,
Jacksonville, for Appellee-Aurora Loan Services, LLC.

PER CURIAM.

We reverse the final judgment of foreclosure entered in favor of appellee
Nationstar Mortgage, LLC, successor in interest to Aurora Loan Services,
LLC (Aurora), because appellee failed to establish by competent evidence
that Aurora had standing to enforce the mortgage when it filed the
mortgage foreclosure action.

Whether a party has standing to bring an action is reviewed de novo.
Boyd v. Wells Fargo Bank, N.A., 143 So. 3d 1128, 1129 (Fla. 4th DCA
2014).

“The plaintiff must prove that it had standing to foreclose when the
complaint was filed.” Vidal v. Liquidation Props., Inc., 104 So. 3d 1274,
1276 (Fla. 4th DCA 2013) (quoting McLean v. JP Morgan Chase Bank Nat’l
Ass’n, 79 So. 3d 170, 173 (Fla. 4th DCA 2012)) (quotation marks omitted).
“Pursuant to Florida Rule of Civil Procedure 1.260, a substituted plaintiff
acquires the standing of the original plaintiff.” Kiefert v. Nationstar Mortg.,
LLC, 153 So. 3d 351, 353 n.4 (Fla. 1st DCA 2014).

“[S]tanding may be established from a plaintiff’s status as the note
holder, regardless of any recorded assignments.” McLean, 79 So. 3d at
173. A person entitled to enforce an instrument is either the “holder of
the instrument,” the “nonholder in possession of the instrument who has
the rights of a holder” or “[a] person not in possession of the instrument
who is entitled to enforce the instrument . . . .” § 673.3011, Fla. Stat.
(2008). A “holder” is defined as “[t]he person in possession of a negotiable
instrument that is payable either to bearer or to an identified person that
is the person in possession.” § 671.201(21)(a), Fla. Stat. (2008). “If the
note does not name the plaintiff as the payee, the note must bear a special
endorsement in favor of the plaintiff or a blank endorsement.” McLean, 79
So. 3d at 173.

In Seffar v. Residential Credit Solutions, Inc., 160 So. 3d 122, 123 (Fla.
4th DCA 2015), this court found that a substituted plaintiff failed to prove
the original plaintiff had standing to file the foreclosure complaint. The
original plaintiff/servicer, RCS, alleged that it had the right to enforce the
note and mortgage. Id. The note attached to the complaint named another
institution as the original lender and did not contain any endorsements or
allonges. Id. After filing the complaint, RSC filed the original note with an
undated blank allonge, payable to the bearer. Id. Before trial, RSC
substituted Bayview Loan Servicing as plaintiff. Id. at 123-24.

At trial, Bayview failed to prove that RCS was the holder or that RCS or
itself was a nonholder in possession. Id. at 125-26. As an alternative
proof of ownership of the note and mortgage, Bayview relied on a letter
from RCS to the homeowners, notifying them of the transfer of servicing
rights to RCS. Id. at 126. Bayview sent out a similar letter when it
obtained servicing rights. Id. Neither letter addressed RCS’s or Bayview’s
rights to enforce the note. Id. Moreover, Bayview did not introduce RCS’s
or Bayview’s servicing agreements into evidence to prove what rights they
acquired under those agreements. Id. This court reversed because the
evidence presented was inadequate to prove standing. Id. at. 127.

Similar to the situation in Seffar, Nationstar failed to provide any
evidence, such as a servicing agreement, to prove that Aurora had the right
to enforce the Note when it filed the foreclosure action. Aurora filed its

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foreclosure complaint on August 25, 2008. In the original complaint,
Aurora alleged that it was the owner or holder of the Note and that the
Note was lost. Aurora subsequently amended the complaint three times.
In the First Amended Complaint, Aurora dropped the lost note count and
attached a copy of the Note to the complaint, with a special endorsement
to Deutsche Bank. In the Third Amended Complaint, instead of alleging
that it was the owner or holder of the Note, Aurora alleged that it was a
servicing agent for Deutsche Bank and that it was authorized to prosecute
the foreclosure action on behalf of Deutsche Bank.

At trial, Nationstar presented evidence that Deutsche Bank was the
owner of the Note when Aurora filed the complaint. The original Note
contained a special endorsement to Deutsche Bank, and Nationstar’s only
witness testified that Deutsche Bank was the owner of the Note.
Nationstar introduced into evidence a print screen from Aurora’s system
which shows the scanned copy of the Note including a special endorsement
to Deutsche Bank. The print screen was dated August 22, 2008, three
days prior to Aurora filing the complaint.

Appellee failed to establish that Aurora had standing to sue on the date
of the filing of the suit where there was no assignment of the mortgage and
Note, no blank or special endorsement in favor of Aurora on the promissory
Note, and no competent evidence that Aurora held the Note on the date it
filed suit.

Because Aurora was not shown to be the holder of the Note, it
essentially proceeded under the theory that it was a nonholder in
possession of the Note with the rights of a holder. However, Aurora failed
to provide sufficient proof that it was authorized at any time to prosecute
the foreclosure action on behalf of Deutsche Bank. In short, there was
insufficient proof that Aurora was the holder of the Note or was otherwise
a person entitled to enforce the Note at the time it filed the action.
Accordingly, we reverse the final judgment of foreclosure and remand for
the trial court to enter an order of involuntary dismissal.

Reversed and Remanded.

TAYLOR, MAY and KLINGENSMITH, JJ., concur.

* * *

Not final until disposition of timely filed motion for rehearing.

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