HSBC BANK USA, NATIONAL ASSOC., ETC.
v.
JULIO R. SANCHEZ A/K/A JULIO RAMIREZ SANCHEZ, GINA CARVALLO
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HSBC Bank filed successive foreclosure actions against borrowers for mortgage defaults. The trial court dismissed the second foreclosure suit, finding it failed to state a cause of action because it alleged defaults occurring during the pendency of the first suit. The appellate court reversed, holding that under Bartram v. U.S. Bank Nat'l Ass'n, each subsequent default after dismissal of the first action creates a new cause of action.
The court reversed and held that under Bartram, each subsequent default accruing after dismissal of the first foreclosure action creates a new cause of action. Because the Bank's complaint alleged missed payments occurring after April 9, 2014, it stated a valid cause of action. The case was remanded for entry of judgment in favor of the Bank and determination of damages.
[1] Each payment default occurring after dismissal of an earlier foreclosure action constitutes a separate and new cause of action, permitting a lender to file a successive f…
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Join FLexlaw to unlock all legal intelligenceThe first foreclosure suit was filed in 2009 and dismissed with prejudice on April 9, 2014, in favor of the borrowers. The second foreclosure suit was…
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PER CURIAM. This appeal involves successive foreclosure lawsuits filed by HSBC Bank against the Appellees (the “borrowers”). The trial court found that the Bank’s complaint failed to state a cause of action because the default date alleged fell during the pendency of its prior foreclosure action. Because the Bank alleged a series of payment defaults which were successive causes of action, some accruing during the pendency of the first suit and some accruing after its dismissal, we reverse.
In this case, the first foreclosure suit was filed in 2009 and judgment was entered in favor of the borrowers on April 9, 2014 (with prejudice). The second foreclosure suit was filed in 2015, alleging that the borrowers were in default for failing to make the payment due under their note on May1, 2011, and all subsequent payments. Following a non-jury trial, the court found in favor of the Bank on all issues, and would have entered judgment in favor of the Bank but for language found in Bartram v. U.S. Bank Nat’l Ass’n, 211 So. 3d 1009 (Fla. 2016), which said:
[The lender] was not precluded by the statute of limitations from filing a subsequent foreclosure action based on payment defaults occurring subsequent to the dismissal of the first foreclosure action, as long as the alleged subsequent default occurred within five years of the subsequent foreclosure action. Id. at 1012 (emphasis added). The trial court interpreted this language to mean that a second or subsequent foreclosure complaint failed to state a cause of action where it alleged a payment default occurring prior to the dismissal of the first foreclosure action.
Bartram expressly found that “each subsequent default accruing after the dismissal of an earlier foreclosure action creates a new cause of action.” Id. at 1020. Therefore, in this case, under Bartram, a new cause of action accrued each time the borrowers missed a payment after April 9, 2014 (when the first foreclosure action was dismissed). Because the Bank’s complaint included allegations of missed payments (defaults) occurring subsequent to the dismissal of the first cause of action, the Bank stated a cause of action under Bartram.1 We reverse the order of dismissal and remand for entry of judgment in favor of the Bank. We note that the trial court failed to make any findings concerning the Bank’s damages, so on that issue, we remand for further proceedings.
Reversed and remanded for further proceedings. GERBER, C.J., GROSS and KUNTZ, JJ., concur. * * * Not final until disposition of timely filed motion for rehearing.