Court Opinion

ID: 4118320
Source: CourtListenerOpinion
Date Created: 2017-01-25 16:06:49.25361+00
Date Added: 2024-06-11T09:10:00.639260
License: Public Domain

Third District Court of Appeal
                               State of Florida

                          Opinion filed January 25, 2017.
         Not final until disposition of timely filed motion for rehearing.

                               ________________

                               No. 3D15-2723
                         Lower Tribunal No. 09-34679
                             ________________

                   Estate of Enemencia de los Santos,
                                      Appellant,

                                         vs.

                National Equity Recovery Services, Inc.,
                                      Appellee.

     An Appeal from the Circuit Court for Miami-Dade County, Eric William
Hendon, Judge.

     Michael Farrar, for appellant.

     Law Office of Rafael De Araujo, P.A., and Rafael De Araujo, for appellee.

Before WELLS and SCALES, JJ., and SHEPHERD, Senior Judge.

     SCALES, J.

     The Estate of Enemencia de los Santos (“Estate”) appeals an order granting

National Equity Recovery Services, Inc. (“NERS”) fees in the total amount of
$2,292.44 for its services as a surplus trustee under section 45.034 of the Florida

Statutes. Although we conclude that NERS is entitled to seek payment, we reverse

and remand the case to the trial court to conduct an evidentiary hearing to

determine the appropriate amount of such statutory fees.

      During the pendency of a foreclosure action against a condominium unit

owned by Enemencia de los Santos, Ms. de los Santos died. After final judgment

of foreclosure was entered in favor of the lender and after the foreclosure sale –

from which a surplus in the amount of approximately $19,000 went unclaimed –

the trial court appointed NERS to locate the owner of these surplus funds. Under

the statute, NERS had one year from its appointment on February 4, 2013, to

locate the owner. § 45.034(6), Fla. Stat. (2013).

      In the meantime, a summary administration was established in probate court

for the Estate. The heirs of the Estate learned about the surplus foreclosure funds

before NERS identified the heirs. Summary administration of the Estate completed

on August 29, 2013. After obtaining the order of summary administration, the heirs

sought disbursement of the surplus foreclosure funds, obtaining an order from the

trial court for this purpose on September 24, 2013. The heirs did not provide notice

to NERS of the disbursement hearing.

      NERS objected to the disbursement in January of 2014. NERS sought

payment from the Estate of its statutory two percent cost advance and its statutory

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ten percent service charge from the total foreclosure surplus. § 45.034(7), Fla. Stat.

(2013). The trial court agreed with NERS and ordered the Estate to pay NERS

$2,292.44, representing twelve percent of the foreclosure surplus. The Estate has

challenged the order on several grounds.

      We conclude that once NERS had been appointed as surplus trustee, the trial

court should not have disbursed surplus foreclosure funds to the heirs without

notice to NERS of the disbursement hearing. At such a hearing, the trial court has

the discretion to determine the surplus trustee’s entitlement to a cost advance and

service charge, even though circumstance might have contrived against the surplus

trustee obtaining a disbursement order. Nat’l Equity Recovery Servs., Inc. v.

MidFirst Bank, 8 So. 3d 406, 408 (Fla. 4th DCA 2009). In this instance, NERS did

not obtain a disbursement order because it learned, before the one-year deadline for

completing its work, that the funds already had been disbursed to the heirs.

      We reverse the order on appeal and remand the case to the trial court for an

evidentiary hearing that will allow NERS to establish its right to a two percent cost

advance and to demonstrate, based on its performance as the appointed surplus

trustee, its entitlement to a service charge.

      Reversed and remanded with instructions.

      WELLS, J., concurs.

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                       Estate of de los Santos v. National Equity Recovery Services
                                                               Case No. 3D15-2723

      SHEPHERD, Senior Judge, concurring.

      I concur in the reversal of this case for further proceedings, but only on due

process grounds, because it appears from the record that National Equity Recovery

Services, Inc. (NERS) did not receive notice of the hearing on the order of

disbursement, despite the fact that NERS had been appointed surplus trustee

pursuant to section 45.032(3)(c) of the Florida Statutes more than nine months

before the disbursement.

      I write only to add that I believe it is premature for the majority to order an

evidentiary hearing “to determine the appropriate amount of statutory fees.”

NERS’ entitlement to a fee in this case is strictly governed by statute:

      (7) A surplus trustee is entitled to the following service charges and
      fees which shall be disbursed by the clerk and payable from the
      surplus:

      (a) Upon obtaining a court order, a cost advance of 2 percent of the
      surplus.

      (b) Upon obtaining a court order disbursing the surplus to the owner
      of record, a service charge of 10 percent of the surplus.

§ 45.034(7), Fla. Stat. (2013).

      Placing its primary reliance on National Equity Recovery Services, Inc. v.

MidFirst Bank, 8 So. 3d 406 (Fla. 4th DCA 2009), the majority suggests the

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requirements of the statute are discretionary. I disagree. Absent true legerdemain

by the heirs or their counsel (see Maj. Op. at p. 3 suggesting “circumstances may

have contributed against the surplus trustee obtaining a disbursement order”),

NERS must satisfy the plain language of section 45.034(7) in order to recover any

cost advance or service fee.

      National Equity Recovery Services, Inc. v. MidFirst Bank is distinguishable

from the case before us because in that case, there were two competing, eligible

recipients of the ten-percent service fee in question in the case. One of them,

Homeworks Recovery Services had obtained the two-percent cost advance by

court order in its capacity as the statutorily appointed surplus trustee as authorized

by the statute in existence at the time. See § 45.034(7), Fla. Stat. (2007). The

other, the same NERS that is a party to this case, secured the actual release of the

surplus funds and was found by the district court to have an equal claim with

Homeworks Recovery Services on the service fee in its capacity as the statutory

assignee of the owner of the funds under a related provision of the surplus recovery

law. See § 45.033(3), (5), Fla. Stat. (2007). It was under this set of facts that the

court ordered a division of the service fee.

      In this case, we do not have two competing, legally entitled entities, both of

whom have performed a service. Rather, we have a single entity, NERS, which is

entitled to a fee only if it satisfies certain statutory requirements. MidFirst Bank

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cannot be read to authorize discretionary disbursements of the statutory service fee

in all circumstances.

      Accordingly, on the facts of this case, I would remand for consideration of

whether NERS satisfied the requirements of section 45.034(7) and, if not, whether

it has any legal defense, such as legerdemain by the heirs and their counsel, for not

doing so.1

1 Since we are unwinding the entire proceeding, the heirs should also be permitted
to pose any challenges they have to the statute itself, including takings challenges.

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