Court Opinion

ID: 6328101
Source: CourtListenerOpinion
Date Created: 2022-03-30 15:02:43.699269+00
Date Added: 2024-06-11T09:22:35.937848
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                            FOURTH DISTRICT

   U.S. BANK NATIONAL ASSOCIATION, NOT IN ITS INDIVIDUAL
  CAPACITY BUT SOLELY AS TRUSTEE FOR MEB LOAN TRUST IV,
                         Appellant,

                                    v.

             STEVEN D. GROB, DOROTHY M. GROB,
         THE RIVER HOMEOWNERS ASSOCATION, INC.,
       RENEE A. HAY a/k/a RENEE HAY, and BARRY F. HAY,
                           Appellees.

                             No. 4D21-1456

                            [March 30, 2022]

  Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Donald W. Hafele, Judge; L.T. Case No.
502020CA008537XXXXMB.

   David Rosenberg and Jarrett Cooper of Robertson, Anschutz, Schneid,
Crane & Partners, PLLC, Boca Raton, for appellant.

   Joseph J. Huss and Benny A. Ortiz of Krinzman Huss Lubetsky
Feldman & Hotte, Fort Lauderdale, for appellees Steven and Dorothy
Grob.

   J. Michael Burman of Reid Burman Lebedeker Xenick Pepin, West
Palm Beach, for appellee Renee Hay.

KUNTZ, J.

   U.S. Bank National Association, as trustee for MEB Loan Trust IV,
appeals the circuit court’s order granting the Borrowers’ motion to
dismiss U.S. Bank’s foreclosure complaint. We reverse.

                               Background

   After the Borrowers defaulted on a home equity line of credit, secured
by a mortgage, U.S. Bank, as trustee for MEB Loan Trust IV, filed suit.
U.S. Bank alleged that the mortgage was assigned to MEB Loan Trust IV
by the original lender and that the “plaintiff has standing to enforce its
rights and obligations under the HELOC, including the right to foreclose
the subject HELOC and Mortgage.” 1 Further, Specialized Loan Servicing
LLC was the servicer of the HELOC and the mortgage. As servicer,
Specialized Loan signed the verification to the foreclosure complaint.2
Finally, a copy of the original loan documents, endorsed in blank, was
attached to the complaint.

   The Borrowers moved to dismiss the complaint, arguing that “the
HELOC is a nonnegotiable instrument that can only be enforced by its
owner.” The Borrowers stated that “[s]ince this action was brought by
the servicer, on behalf of the trustee for the owner of the debt, this action
cannot be maintained and must be dismissed.”

    The circuit court granted the motion to dismiss the complaint for lack
of standing.

                                      Analysis

   U.S. Bank argues the circuit court erred when it dismissed the
complaint for lack of standing. U.S. Bank asserts the allegations within
the complaint establish standing. The Borrowers respond that the
circuit court correctly found U.S. Bank lacked standing and that the
“discreet issue before this Court is whether a loan servicer, on behalf of
the owner of a non-negotiable instrument, can bring an action to enforce
the non-negotiable instrument.”

   The Borrowers are correct that the HELOC here is a nonnegotiable
instrument. The HELOC acted as a “credit line” for the Borrowers. But,
generally, assignees of nonnegotiable instruments take “all the rights of
the assignor . . . subject to all the equities and defenses of the debtor
connected with or growing out of the obligation that the obligor had
against the assignor at the time of the assignment.” State v. Fam. Bank
of Hallandale, 667 So. 2d 257, 258 (Fla. 1st DCA 1995); see also
OneWest Bank, FSB v. Nunez, 193 So. 3d 13, 14 (Fla. 4th DCA 2016).
So, U.S. Bank, as trustee for MEB Loan Trust IV, acquired the rights of
the original holder.

1   A “HELOC” is a home equity line of credit.
2 The complaint confusingly stated that Specialized Loan had “the authority to
initiate the instant foreclosure on behalf of Plaintiff pursuant to a power of
attorney or servicing agreement.”

                                          2
  The remaining question is whether the allegations in the complaint
were enough to show standing. The answer is yes.

    The complaint alleged that the mortgage was assigned to the plaintiff:
U.S. Bank, as trustee for MEB Loan Trust IV. An attachment to the
complaint showed that the original lender assigned its interest to MEB
Loan Trust IV. Further, when the complaint was filed, a certification of
possession was filed under penalty of perjury stating that U.S. Bank
National Association, as trustee for MEB Loan Trust IV, had possession
of the original loan documents. Those facts support standing.

   But the verification of the complaint by Specialized Loan, the servicer,
seems to have caused unnecessary confusion.                The servicer’s
involvement does not diminish the authority of the holder to foreclose.
See, e.g., Caraccia v. U.S. Bank, Nat’l Ass’n, 185 So. 3d 1277, 1279 (Fla.
4th DCA 2016); Deutsche Bank Nat’l Tr. Co. v. Huber, 137 So. 3d 562,
564 (Fla. 4th DCA 2014) (“A plaintiff’s loan servicing agent is a proper
representative to verify a mortgage foreclosure complaint.”).

   As the alleged trustee for MEB Loan Trust IV, U.S. Bank has the right
to “[p]rosecute or defend, including appeals, an action, claim, or judicial
proceeding in any jurisdiction to protect trust property or the trustee in
the performance of the trustee’s duties.” § 736.0816(23), Fla. Stat.
(2020).

    Therefore, U.S. Bank, as trustee for MEB Loan Trust IV, had standing
to foreclose, and the court erred when it dismissed the complaint.

                                Conclusion

  The circuit court’s order dismissing the complaint filed by U.S. Bank
National Association, as trustee for MEB Loan Trust IV, is reversed.

   Reversed and remanded for further proceedings.

CONNER, C.J., and FORST, J., concur.

                           *           *      *

   Not final until disposition of timely filed motion for rehearing.

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