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Borrowers Seeking Fees Cannot Use Same Contracts Establishing Right to Foreclose

  • Borrowers Seeking Fees Cannot Use Same Contracts Establishing Right to Foreclose

    Borrowers Seeking Fees Cannot Use Same Contracts Establishing Right to Foreclose

    In a recent opinion put forth by fourth district court of appeal judge Jeffrey T. Kuntz, borrowers seeking attorneys fees on appeal cannot use the same contracts that said they prevail on an argument of lacking legal right to foreclose.
    The opinion stemmed from a case involving a borrower named Marie Ann Glass, who relied on a mortgage clause and the reciprocity provisions within Florida statutes. The specific statute referenced permits courts to apply fees and provisions pertaining to contracts for both parties, even if a the contract in question is a one-sided contract. However, the statute has two requirements, a prevailing litigant and multiple parties within the contract. Kuntz stated that because the statute specifically opposes common law, it must be adhered to in a strict manner.
    Glass’ case sought attorney’s fees from a business known as Champion Mortgage Co., after they challenged a judge’s dismissal of an amended foreclosure complaint. Glass succeeded on an argument that the company lacked standing to foreclose on her debt, but her victory blocked her claim for appellate fees.
    Kuntz stated that the borrower must establish that both parties within the lawsuit must also be the parties within the contract that contains the fee provision. Since Glass succeeded on her argument that Champion Mortgage Co. did not have a right to foreclose, then her contract did not specifically deal with them and she would be unable to see fees.
    However, there is an exception to this opinion which arises when the lender specified in a contract is the original party in the contract, and are still unable to establish legal standing for the right to foreclose.