Foreclosure Statute of Limitations in Florida
Oral arguments in a case we’ve been following for over a year, Bartram v. US Bank, regarding the foreclosure statute of limitations in Florida, were heard by the Florida Supreme Court last week. The core issue the Court is evaluating is whether the five year foreclosure statute of limitations in Florida bars claims by a lender where the lender institutes a legal proceeding, purports to accelerate the mortgage in the proceeding, the proceeding is dismissed, and more than five years later, the lender attempts to reinstitute a foreclosure proceeding. You can review earlier blogs for more background and listen to the full argument here.
The attorney for Bartram, the homeowner, began his argument with two points that are the core of the argument in favor of his client: (1) since 1974, the statute of limitations for foreclosure is 5 years; and (2) that subsequent case law consistently provides that an acceleration makes all payments on a debt immediately due. He didn’t make it much further before he faced a series of difficult questions by Justice Pariente followed by questions from other justices.
A few of the attorney’s key points in response to questions posed included:
- Valid acceleration starts acceleration, meaning that all payments are that would be due in the future become due immediately. This means that acceleration predicated based on lack of preconditions or if the lender waived reliance by for example, accepting payment, arguable would not accelerate the payments due.
- Res judicata is a distinct issue from statute of limitations. Thus, Singleton v. Greymar Associates, 882 So. 2d 1004 (Fla. 2004), a case that allowed a second foreclosure action on the same mortgage after an initial case was dismissed with prejudice on the grounds that res judicata, does not extend to the instant case or mandate a decision in favor of the lender.
- A final judgment of foreclosure is not required in order for acceleration to begin. Rather, acceleration begins upon notice of acceleration.
- Statute of repose also favors a decision in favor of the homeowner.
For his part, US Bank’s attorney predictably disagreed with most of the homeowner attorney’s points. Justice Pariente was again vocal in her questioning at one point, questioning US Bank’s attorney about the weight of authority in cases nationally, which supports the homeowner’s position. Among the Bank attorney’s points:
- Acceleration is not effective until a final judgment is instituted. He analogized it to a 5k where the notice of acceleration in the beginning of the litigation is the start of the race, but like a race is not complete until the finish line is crossed, the acceleration isn’t complete until a final judgment is entered.
- The principles of res judicata set forth in Singleton v. Greymar Associates, 882 So. 2d 1004 (Fla. 2004) were applicable by analogy to the case. There would be no difference in outcome between a dismissal with prejudice and a dismissal without prejudice.
If you’re a little confused, don’t worry, even the justices acknowledged that this is a legally “complicated” case during oral arguments and based on the oral argument alone, there was no clear winner. One thing is certain the decision will have important implications for homeowners facing foreclosure across the state of Florida. A decision in favor of Bartram will give homeowners an important tool in fighting against foreclosure.
If you’re facing foreclosure and want to learn more about how the foreclosure statute of limitations in florida could affect your case, the Jacksonville foreclosure defense attorneys at Adam Law Group are available to discuss it.