Law Offices of Robin Bresky Obtains Affirmance of Order Limiting Successor Mortgagee’s Liability Following a Foreclosure Sale

Law Offices of Robin Bresky Obtains Affirmance of Order Limiting Successor Mortgagee’s Liability Following a Foreclosure Sale

The Sterling Villages of Palm Beach Lakes v. The Bank of New York, 4D11-3008

The Law Offices of Robin Bresky recently won an affirmance of an order limiting a successor mortgagee’s liability to the homeowner’s association (“HOA”) following a foreclosure sale. Our client held a mortgage on property located within the HOA. The unit owner defaulted. Our client foreclosed on the property, and joined the HOA in the foreclosure suit. Our client purchased the unit at foreclosure sale and obtained a certificate of title.

Following the foreclosure sale, our client sought to determine its liability to the HOA for the outstanding unpaid assessments on the unit. Our client took the position that it was a successor mortgagee whose liability for unpaid assessments was limited by the operation of section 718.116(1)(b), Florida Statutes, to the lesser of the preceding twelve months’ assessments prior to taking title, or one percent of the mortgage debt. The HOA sought discovery on the issue of whether our client was a successor mortgagee. The HOA also argued that our client was required to initiate a separate proceeding in which to determine the amounts due to the HOA. The HOA also sought various amounts for interest and other charges accruing prior to the time our client took title. The trial court rendered an order in our client’s favor denying discovery and limiting our client’s liability pursuant to the statute. The HOA appealed.

We argued on appeal that the trial court had already determined in its Final Judgment of Foreclosure that our client was a successor mortgagee and the HOA had failed to appeal the Final Judgment, so discovery on that issue would not be appropriate. We also argued that our client’s liability was limited by the statute and the statute did not include the various additional amounts sought by the HOA. The Fourth DCA issued a per curiam affirmance of the trial court’s order. This result in the appellate court preserved the beneficial outcome for our client.