The embattled foreclosure Law Offices of David J. Stern
, which ceased foreclosure work last month, is at the center of a legal issue that has made its way to the Florida Supreme Court.
Attorneys representing Roman Pino, a man that previously faced foreclosure in the state, have asked the state's Supreme Court to evaluate a lower court's decision in allowing parties operating under the mortgage trustee's name
to voluntarily dismiss the foreclosure case against Pino when allegations of possible fraud surfaced. The fraud allegations arose in relation to the handling of mortgage assignment documents, according to attorneys familiar with the matter and case filings.
When asked about the case Tuesday, a spokesman for The Bank of New York Mellon
, which is listed as the defendant and trustee in the case, explained that "BNY Mellon acts as trustee on certain mortgage-backed securitizations, which are created when mortgage loans are pooled and placed in a trust. While foreclosure actions related to properties held in the trust must be brought in the trustee's name, the foreclosure activity itself is coordinated, litigated and managed entirely by the servicers." This includes the Pino v. BNY case, the spokesman said. The court case did not name the servicer, and it was not immediately clear who acted as servicer.
What happened in the foreclosure case is long-winded and convoluted, but it began in a simple foreclosure proceeding when attorneys for Pino challenged a foreclosure action filed by BNY as trustee.
Pino's attorneys responded to the first action, saying the bank had no assignment for Pino's mortgage, making it impossible for the bank to foreclose, says Enrique Nieves with ICE Legal
, an attorney for Pino.
Court records say representatives for the Trustee "responded by amending the complaint only to attach a new unrecorded assignment, which happened to be dated just before the original pleading was filed." Pino's attorneys and court records allege the assignment was drafted by litigation attorneys in David J. Stern's law office after the case had already begun.
Attorneys for David J. Stern could not be reached for comment.
Pino's attorneys then argued in the district court that the opposition "was attempting fraud on the court (in relation to the new assignment document) and that the court should consider appropriate sanctions, such as dismissal of the action with prejudice."
Before depositions were heard on the issues surrounding the mortgage assignment handled by the David J. Stern law firm, "BNY Mellon filed a notice of voluntary dismissal of the action," court records say.
It's at this point when the issue currently on appeal with the Florida Supreme Court surfaced. Nieves says BNY Mellon went on to file a separate, new foreclosure action against Pino. In response, Pino's attorneys filed a motion "seeking to strike the voluntary dismissal in the original action on the grounds of fraud on the court and for a dismissal of the newly filed action as a consequent sanction, requesting an evidentiary hearing."
The trial court denied that motion, saying Bank of New York Mellon had not succeeded in finalizing its foreclosure prior to the bank's voluntary dismissal, so they would not force an evidentiary hearing or strike the voluntary dismissal.
The attorneys for Pino then appealed to the District Court of Appeal of Florida Fourth District.
The issue presented to the fourth district by Pino's attorneys was whether a party could escape claims of fraud and possible sanctions arising from actions tied to the handling of the mortgage assignment by "evading the issue through a voluntary dismissal."
The official issue outlined by attorneys is:
Does a trial court have jurisdiction and authority under Rule 1.540(b), Fla.R.Civ.P., or under its inherent authority to grant relief from a voluntary dismissal where the motion alleges a fraud on the court in the proceedings but no affirmative relief on behalf of the plaintiff has been obtained from the court?
After a judge retired from the appellate court, the remaining justices at the fourth district were divided on the issue, prompting the case's removal to the supreme court level, attorneys say.
Nieves said the case was filed with the Florida Supreme Court this week. The court has not officially accepted the case, but did note that it's a high-priority case that is likely to receive attention from reporters and interested parties.
, the law firm handling BNY's case on appeal, could not be reached for comment. However, Akerman Senterfitt clearly attempted in previous court filings to separate its role in the case from that of David J. Stern attorneys.
Akerman Senterfitt asked an appellate court in prior court records to note that "[n]o Akerman Senterfitt lawyer was involved with this initial foreclosure action against Pino." The law firm goes a step further in the current case, saying the "filing of the complaint at issue" ties back to an attorney working at the law offices of David J. Stern, P.A.
Write to Kerri Panchuk.