FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
from the Circuit Court for Brevard County, Lisa Davidson,
Bowin, of Bowin Law Group, Indialantic, for Appellant.
Brandon S. Vesely, of Albertelli Law, Tampa, for Appellee,
Green Tree Servicing, LLC.
Appearance for other Appellees.
Green ("Borrower") appeals the trial court's
final foreclosure judgment in favor of Green Tree Servicing,
LLC ("Green Tree"). Because Green Tree did not
establish its standing to foreclose, we reverse and remand
for the entry of an involuntary dismissal.
2004, Borrower executed and delivered a note and mortgage in
favor of Countrywide Home Loans, Inc. ("CHL,
Inc."). In December 2009, BAC Home Loans Servicing, LP
("BAC"), f/k/a Countrywide Home Loans Servicing, LP
("CHL Servicing, LP"), filed a foreclosure
complaint against Borrower, alleging a January 2009 default
date. BAC also alleged its status as loan servicer and holder
of the note. To the complaint, BAC attached an unindorsed
copy of the note. Borrower answered the complaint, denying
BAC's ownership of the note, and asserted a lack of
standing as an affirmative defense.
2012, the trial court granted BAC's motion to substitute
Bank of America, N.A., its successor by merger, as plaintiff.
Then, in April 2014, the trial court granted Bank of
America's motion to substitute Green Tree as plaintiff,
by virtue of assignment. In October 2014, Green Tree filed an
amended complaint, once again alleging a January 2009 default
date. In the amended complaint, Green Tree alleged its status
as holder of the note and attached a copy of the note bearing
an undated blank indorsement from CHL, Inc. In his answer,
Borrower again raised BAC's lack of standing.
trial, Green Tree called Christopher Lee, a foreclosure
mediation specialist for Ditech Financial, LLC
("Ditech"), "formerly known as Green Tree
Servicing LLC." The original note admitted into evidence
at trial bore the same blank indorsement as the copy attached
to the amended complaint. Lee testified that he had no
knowledge of when CHL, Inc., indorsed the note, and provided
no business records to indicate the date. Over Borrower's
objection, the trial court admitted several merger documents,
including an August 2015 certificate of merger between Green
Tree and Ditech. The certificate of merger provided that
"[t]he surviving limited liability company is Green Tree
Servicing LLC, " but then added that "[t]he name of
the surviving limited liability company is hereby amended to
Ditech Financial LLC." Lee further testified that
"Countrywide Home Loan Servicing was renamed BAC Home
Loan Servicing" in April 2009, before the filing of the
original complaint, but Green Tree presented no other
evidence or testimony about any servicing agreements. After
trial, the lower court entered final judgment of foreclosure
for Green Tree.
crucial element in any mortgage foreclosure proceeding is
that the party seeking foreclosure must demonstrate that it
has standing to foreclose." McLean v. JP Morgan
Chase Bank Nat'l Ass'n, 79 So.3d 170, 173 (Fla.
4th DCA 2012). We review a trial court's decision as to
this standing requirement de novo. See Elsman v. HSBC
Bank USA, 182 So.3d 770, 771 (Fla. 5th DCA 2015).
"[A] person entitled to enforce the note and foreclose
on a mortgage is the holder of the note, a non-holder in
possession of the note who has the rights of a holder, or a
person not in possession of the note who is entitled to
enforce . . . ." Gorel v. Bank of N.Y. Mellon,
165 So.3d 44, 46 (Fla 5th DCA 2015) (citing § 673.2011,
Fla. Stat. (2013)). Generally, "a party's standing
is determined at the time the lawsuit was filed."
McLean, 79 So.3d at 173. Here, BAC's original
complaint did not establish its holder status because it
included only an unindorsed note payable to the original
lender, CHL, Inc. Cf. § 671.201(21), Fla. Stat.
(2015) (defining "holder" as "[t]he person in
possession of a negotiable instrument that is payable either
to bearer or to an identified person that is the person in
possession"). Thus, Green Tree properly concedes that
its subsequent filing of the indorsed note with the amended
complaint and at trial did not retroactively establish
BAC's standing at the inception of the suit. See
Walsh v. Bank of N.Y. Mellon Tr., 219 So.3d 929, 930
(Fla. 5th DCA 2017).
Instead, Green Tree asserts that the merger between BAC and
CHL Servicing, LP, established BAC's standing at the time
of filing the original complaint. "[I]n order to prove
standing to foreclose based upon a merger, the surviving
entity must prove that it 'acquired all of [the absorbed
entity's] assets, including [the] note and mortgage, by
virtue of the merger.'" Vogel v. Wells Fargo
Bank, N.A., 192 So.3d 714, 716 (Fla. 4th DCA 2016)
(quoting Fiorito v. JP Morgan Chase Bank, Nat'l
Ass'n, 174 So.3d 519, 521 (Fla. 4th DCA 2015)).
Here, like the witness in Vogel, Green Tree's
witness offered no explanation "as to why the copy of
the note attached to the complaint . . . did not reflect the
[i]ndorsements" and testified that he did not know when
the blank indorsement was placed on the note. See
id. at 716-17. Additionally, the witness testified
primarily about Ditech's receipt of Green Tree's and
BAC's business records but failed to address the transfer
of the note to BAC pursuant to the merger. Thus, Green Tree
failed to demonstrate that BAC acquired standing based on the
merger. See id.
the merger may not have established BAC's standing even
with the necessary evidence at trial. The merger involved BAC
and CHL Servicing, LP, while the original note listed CHL,
Inc., as the original lender. Neither Green Tree nor its
witness explained the relationship between these two distinct
entities. Furthermore, throughout trial, Green Tree's
counsel improperly conflated the two by referring to both as
"Countrywide Home Loans, " or simply
"Countrywide." See Wisman v. Nationstar Mortg.,
LLC, 42 Fla.L.Weekly D2251, D2252 (Fla. 5th DCA Oct. 20,
2017) ("While Nationstar claims that CHL Inc., CHL
Servicing, LP and BAC are the same entity, its own evidence
demonstrates otherwise. . . . [T]he evidence fails to show
that CHL Inc. was affiliated with either CHL Servicing, LP or
BAC."). Thus, Green Tree unpersuasively argues that BAC
acquired possession of the note by way of the merger with CHL
Servicing, Inc., which never held the note. See
Vogel, 192 So.3d at 716. Only on appeal does Green Tree
argue that CHL Servicing, LP, had standing as the original
servicer. However, the servicer relationship alone does not
demonstrate standing to foreclose. See Rodriguez v. Wells
Fargo Bank, N.A., 178 So.3d 62, 63 (Fla. 4th DCA 2015).
none of Green Tree's purported predecessors had standing
to foreclose at the inception of the case, the trial court
erred by finding that Green Tree acquired standing to
foreclose. See Corrigan v. Bank of Am., N.A., 189
So.3d 187, 190 (Fla. 2d DCA 2016). Accordingly, we ...