Chapter 4-1 Overview of Standing to Foreclose

4-1 Overview of Standing to Foreclose

Perhaps no issue in mortgage foreclosure has been the subject of more litigation than standing to foreclose in recent years.¹

Standing to foreclose is examined by an analysis of whether the plaintiff is a "person entitled to enforce an instrument" as defined by the Florida Uniform Commercial Code.² The "person entitled to enforce an instrument" is defined as: (1) the holder of the instrument; (2) a non-holder in possession of the instrument who has the rights of a holder; or (3) a person not in possession of the instrument who is entitled to enforce the instrument pursuant to Fla. Stat. § 673.3091 or 673.4181(4).³ A person may be a person entitled to enforce the instrument even though the person is not the owner of the instrument or is in wrongful possession of the instrument.⁴ A "holder" is "[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."⁵

Standing to foreclose must be proven as of the time the action is filed and at the time judgment is entered.⁶ Lack of standing at the inception of the case is not a defect that can be cured after the case is filed.⁷ Standing to foreclose must be proven by competent, substantial evidence.⁸

--------

Notes:

^[1] A Westlaw search reveals over 300 Florida District Court opinions that use the term "Standing to Foreclose" since 2010.

^[2] Wells Fargo Bank, N.A. v. Morcom, 125 So. 3d 320 (Fla. 5th DCA 2013) (Florida adopted the Uniform Commercial Code on January 1, 1967).

^[3] Fla. Stat. § 673.3011.

^[4] Fla. Stat. § 673.3011.

^[5] Fla. Stat. § 671.201(21).

^[6] Corrigan v. Bank of Am., N.A., 189 So. 3d 187, 189 (Fla. 2d DCA 2016) (reversing final judgment for the bank where no evidence was presented at trial to show that the original plaintiff held the note indorsed in blank at the time the time the case was filed). The Second District issued its ruling en banc to recede from its decision in AS Lily, LLC v. Morgan, 164 So. 3d 124 (Fla. 2d DCA 2015) where it was suggested that standing may be established at the time an amended complaint is filed. When the plaintiff is not the same plaintiff that filed suit, the plaintiff at trial must prove the standing of both entities at the relevant time, which is discussed in section 4-9.

^[7] Kiefert v. Nationstar Mortgage, LLC, 153 So. 3d 351, 353 (Fla. 1st DCA 2014) (reversing final judgment of foreclosure where the foreclosing plaintiff failed to present evidence...