Stanley Streicher v. U.S. Bank National Association

Case: 16-11621 Date Filed: 12/21/2016 Page: 1 of 7

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT
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No. 16-11621
Non-Argument Calendar
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D.C. Docket No. 9:14-cv-80265-KAM

STANLEY STREICHER,
MARSHA STREICHER,

Plaintiffs-Appellants,

versus

U.S. BANK NATIONAL ASSOCIATION,
U.S. BANK NATIONAL ASSOCIATION AS SUCCESSOR
TRUSTEE OF THE WELLS FARGO ASSET SECURITIES
CORPORATION,
Mortgage Pass-Through Certificates 2005-AR16,

Defendants-Appellees.

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Appeal from the United States District Court
for the Southern District of Florida
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(December 21, 2016)
Case: 16-11621 Date Filed: 12/21/2016 Page: 2 of 7

Before WILLIAM PRYOR, MARTIN, and ANDERSON, Circuit Judges.

PER CURIAM:

Stanley and Marsha Streicher appeal the district court’s order denying their

motion for summary judgment and granting summary judgment to the defendants.

After careful review, we affirm.

In June 2010, a mortgage foreclosure action was brought against the

Streichers in Florida state court. According to the complaint, the party that brought

the foreclosure action against the Streichers was U.S. Bank National Association as

Successor Trustee to Wachovia Bank, National Association, as Trustee for Wells

Fargo Asset Securities Corporation, Mortgage Pass-Through Certificates Series

2005-AR16 (“U.S. Bank”). Although U.S. Bank was the only named plaintiff in

the foreclosure action, Wells Fargo Bank, N.A. (“Wells Fargo”), the mortgage

servicer for U.S. Bank, sought to bring the suit on U.S. Bank’s behalf. At trial,

U.S. Bank made no appearance and Wells Fargo litigated in its place. After the

close of Wells Fargo’s evidence, the state court granted the Streichers’ motion for

involuntary dismissal. The state court dismissed the case on the ground that Wells

Fargo lacked standing because it failed to prove that U.S. Bank authorized it to

bring suit on U.S. Bank’s behalf.

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The Streichers then filed this suit in state court against U.S. Bank, and U.S.

Bank removed the case to federal court.1 The Streichers seek a declaratory

judgment that the state court’s dismissal of the foreclosure action has preclusive

effect on any future actions by U.S. Bank to enforce the promissory note

underlying their mortgage. In plain English, they are asking the federal court to

bar U.S. Bank from collecting the amount the Streichers allegedly owe on their

mortgage, on the ground that the state court determined that Wells Fargo was not

the proper party to bring the original foreclosure action against them.

Both parties moved for summary judgment. The Streichers are entitled to

summary judgment (and U.S. Bank is not) if the state court’s dismissal of the

foreclosure action has preclusive effect as a matter of law, also known as res

judicata. Under Florida law, res judicata may apply only if there has been a prior

adjudication “on the merits.”2 Topps v. State, 865 So. 2d 1253, 1255 (Fla. 2004)

(per curium) (quoting Kent v. Sutker, 40 So. 2d 145, 147 (Fla. 1949)); see also

Vasquez v. YII Shipping Co., 692 F.3d 1192, 1199 (11th Cir. 2012). Thus, we

1
The Streichers’ operative complaint names U.S. Bank as a defendant in its capacity as
Trustee and in its individual capacity. We refer to both collectively as “U.S. Bank.”
2
In addition to the requirement that the earlier action be adjudicated on the merits,
Florida law also requires that “four identities” be present. See Topps, 865 So. 2d at 1255 (“The
doctrine of res judicata applies when four identities are present: (1) identity of the thing sued for;
(2) identity of the cause of action; (3) identity of persons and parties to the action; and (4)
identity of the quality of the persons for or against whom the claim is made.”). Because the state
court action was not decided on the merits, we do not reach the issue of whether the “four
identities” are satisfied.
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must decide whether, under Florida law, dismissal of a foreclosure action for lack

of standing constitutes an adjudication on the merits such that it triggers res

judicata. The district court found that it does not. The Streichers appeal that

decision.

II.

Whether to apply the doctrine of res judicata is a question we review de

novo. Norfolk S. Corp. v. Chevron, U.S.A., Inc., 371 F.3d 1285, 1288 (11th Cir.

2004). When deciding the preclusive effect of a state court judgment, we must

give that judgment the same preclusive effect that “another court of that State

would give [it].” Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280,

293, 125 S. Ct. 1517, 1527 (2005) (quotation omitted) (citing the Full Faith and

Credit Act, 28 U.S.C. § 1738). Thus, we look to what the Florida courts have said

about whether dismissal of a foreclosure action for lack of standing constitutes an

adjudication on the merits for purposes of res judicata. Because the Florida

Supreme Court has not addressed this question, we turn to the Florida appellate

courts. See Galindo v. ARI Mut. Ins. Co., 203 F.3d 771, 775 (11th Cir. 2000)

(“Absent a decision by the highest state court or persuasive indication that it would

decide the issue differently, federal courts follow decisions of intermediate

appellate courts in applying state law.”); Pardo v. State, 596 So. 2d 665, 666

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(Fla. 1992) (“[T]he decisions of the district courts of appeal represent the law of

Florida unless and until they are overruled by this Court.” (quotation omitted)).

The Florida Fifth District Court of Appeal recently decided the precise issue

before us in this case. See Brown v. M & T Bank, 183 So. 3d 1270 (Fla. Dist. Ct.

App. 2016). In Brown, the court considered “[w]hether the dismissal of a

foreclosure action for lack of standing operates as an adjudication on the merits for

purposes of res judicata.” Id. at 1270. The court held it does not. Id.

We must apply the Brown decision unless there is “persuasive indication

that [the Florida Supreme Court] would decide the issue differently.” Galindo, 203

F.3d at 775. There is no indication that it would. It is well established under

Florida law that a judgment is “upon the merits” such that it carries preclusive

effect when the judgment “amounts to a declaration of the law as to the respective

rights and duties of the parties based upon the ultimate facts disclosed by the

pleadings and evidence and upon which the right of recovery depends.” J. Schnarr

& Co. v. Virginia-Carolina Chem. Corp., 159 So. 39, 42 (Fla. 1934); see also State

St. Bank & Trust Co. v. Badra, 765 So. 2d 251, 254 (Fla. Dist. Ct. App. 2000) (“A

judgment rendered on any grounds which do not involve the merits of the action

may not be used as the basis for the operation of the doctrine of res judicata.”). In

Badra, the court held that the trial court’s dismissal of a foreclosure action on the

ground that the bank “fail[ed] to comply with certain conditions precedent” under

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the mortgage was not “an adjudication on the merits” because “[a]t no time did the

court grant summary judgment on the basis that the mortgage was unenforceable.”

Badra, 765 So. 2d at 254–55. Here, like Badra, the state court made no decision as

to the enforceability of the mortgage. To the contrary, the court dismissed the

suit—and refused to reach the merits—because the party seeking relief lacked

standing. Cf. Vasquez, 692 F.3d at 1199 (holding that a Florida court’s dismissal

for forum non conveniens “was not a judgment on the merits because it did not

resolve the respective rights and duties of the parties.” (quotation omitted)).

Because a dismissal for lack of standing is not an adjudication on the merits, the

state court’s dismissal of the foreclosure action against the Streichers does not have

preclusive effect.

The Streichers claim that Florida Rule of Civil Procedure 1.420(b) supports

their argument that a dismissal for lack of standing is an adjudication on the merits.

However, Rule 1.420(b) says that, although an involuntary dismissal generally

“operates as an adjudication on the merits,” a “dismissal for lack of jurisdiction”

does not. Fla. R. Civ. P. 1.420(b). Under Florida law, it is clear that a dismissal

for lack of standing is a dismissal for lack of jurisdiction. See Rogers & Ford

Const. Corp. v. Carlandia Corp., 626 So. 2d 1350, 1352 (Fla. 1993) (“The

determination of standing to sue concerns a court’s exercise of jurisdiction to hear

and decide the cause pled by a particular party.”); Ervin v. Taylor, 66 So. 2d 816,

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817 (Fla. 1953) (en banc) (holding that the court was without jurisdiction where

there were no actual adversaries as to a present controversy). Because the state

court’s dismissal falls into the category of dismissals that the Florida Rules of Civil

Procedure expressly designate as not being “on the merits,” the state court’s

dismissal of the foreclosure action cannot have preclusive effect.

The district court was correct in its determination that the state court

dismissal does not have res judicata effect under Florida law.

AFFIRMED.