2014.03.13 Initial Brief

IN THE DISTRICT COURT OF APPEALFOURTH DISTRICT OF FLORIDA

CASE NO.: 4D13-3514

TAOUFIQ SEFFAR,

Appellant,

vs.

BAYVIEW LOAN SERVICING, LLC,

Appellee.

On appeal from the Seventeenth JudicialCircuit Court in and for Bro\vard County. Florida

L.T. Case No.: 10 25802

INITIAL BRIEF OF APPELLANTTAOUFIQ SEFFAR

DAVID H. CHARLIP, B.C.S.CI-IARLIP LAW GROUP, LC17501 Biscayne Blvd.Suite 510Aventura, Florida 33 1 60Telephone: (305) 354-9313Facsimile: (305) 354-9314Counsel for Appellant

TABLE OF CONTENTS

PAGE NO.

TABLE OF AUTHORITIES ui-vu

STATEMENT OF THE CASE 1

STATEMENT OF THE FACTS 1

STANDARD OF REVIEW 10

SUMMARY OF ARGUMENT 10-11

ARGUMENT 12

I. REVERSAL IS REQUIRED WHERE TRIAL COURT ABUSESITS DISCRETION BY PERMITTING SUBSTITUTION OF THEPLAINTIFF OVER DEFENSE OBJECTION TWO (2) DAYSPRIOR TO TRIAL 12

H. REVERSAL IS REQUIRED WHERE TRIAL COURT ERREDIN OVERRULING APPELLANT’S LACK OF FOUNDATION,AUTHENTiCATION AND HEARSAY OBJECTIONS TOAPPELLEE’S DOCUMENTARY EVIDENCE ANDTESTIMONY 14

IlL THE TRIAL COURT ERRED BY FAILING TO GRANTAPPELLANT’S MOTION FOR INVOLUNTARYDISMISSAL 21

a. Appellee failed to prove that its predecessor held the note at the timethe Complaint was filed, or was otherwise authorized to bring suit onbehalf of the true holder.

b. The alleged Notice of Default alleged to have been given byAppellee was defective in that it failed to conform to the language setforth in paragraph 22 of the Mortgage.

c. Appellee failed to prove Notice of Default was sent to Appellant

I

CONCLUSION .24

CERTIFICATE OF SERVICE 25

CERTIFICATE OF COMPLIANCE 25

II

TABLE OF AUTHORITIES

PAGE NO.

CasesA.JD. v. State, 842 So.2d 297 (Fla. 3d DCA 2003) 27Amos v. Gartnei; Inc., 17 So.3d 829, 833 (FIa. 1 OCA, 2009) 25Baker v. Florida Unemployment Appeals Commission, 35 Fla. L. Weekly Dli 88

(Fla. 3d T’Iay 26, 2010) 35Carapezza v. Pate, 143 So.2d 346, 347 (Fla. 3d DCA 1962) 37Corcoran v. Brody, 347 So. 2d 689, 690 (Fla. 4th DCA 1977) 39CWCapital Asset Mgmt., LLC v. Chicago Properties, LLC, 610 F3d 497(7th Cir.

0) 23, 40Dainico ‘i’. Lundberg, 379 So.2d 964, 965 (Fla. 2d DCA 1979) 36azicJl4ili, 491 So.2d at 1 139 36Ederer v. Fisher, 183 So.2d 39, 41 (Fla. 2d DCA 1965) 32Elston Leetsdale LLC v. CW Capital Asset, 87 So. 3d 14 (Fia. 4th DCA 2012). 22FC’D Dev.. LLC v. S. Fla. Sports Comm., Inc., 37 So.3d 905, 909 (Fla. 4th DCA

2010) 21, 37Feints v. US. BankNat ‘lAss ‘ii, 80 So.3d 375, 377 n. 2 (FIa. 2d DCA 2012) 32Fla Stat. §671.201(44) (2011) 3 1Forester v. Norman Roger Jewell & Brooks Intern., Inc., 610 So.2d 1369, 1373 (Fla.

1St 1:)(D\. 1992) 26Frost v. Regions Bank, 15 So. 3d 905, 906-07 (Fla. 4th DCA 2009) 42Gordon v. State, 787 So.2d 892, 894 (Fla. 4th DCA 2001) 29Hack v. Estate qfffelling, 811 So. 2d 822, 825 (Fla. 5th DCA 2002) 36Haves v. Wal-Mart Stores. Inc., 933 So. 2d 124 (FIa. 4th DCA 2006) 21Jackson v. State. 738 So.2d 382. 386 (Ha. 4th DCA 1999) 29Johnson v. Dept ofHealth & Rehab. Sen’s., 546 So.2d 741, 743 (Fla. 1St DCA

1989) 30Juega v. Davidson, 8 So. 3d 488 (Fla. 3d DCA 2009) 23Kelly v. State Farm Mut. Auta Ins., 720 So.2d 1145, 1146 (Fla. 5th DCA 1998)....29Kingv. State, 590 So.2d 1032 (Fla. 1st DCA 1991) 28Lowe’s ofTallahassee v. Giabno, 552 So.2d 304. 305 (Fla. I st DCA 1989) 25, 26Mazine 1’. M&I Bank, 67 So. 3d 1129, 1129 (Fla. 1st DCA 2011) 25McCabe v. Hanlei’, 886 So. 2d 1053, 1055 (Fla. 4th DCA 2004) 36McKenzie Tank Lines, Inc. v. Roman, 645 So.2d 547 (Fla. 1st DCA 1994) 28Mortgage Elec. Registration Sys., Inc. v. Azize, 965 So.2d 151, 153 (Fla. 2d DCA

2007) ... . . 37Nationwide Mitt. Fire Ins. Co. v. Bruscarino, 982 So.2d 753 (Fla. 4th DCA 2008)..2 I

111

Phil4ppon v. Shreffler, No. 4D07-4104 (Fla. 4th DCA 2010) .21Phillips v. State, 621 So.2d 734 (Fla. 3d DCA 1993) 28Phiogene v. ABNAmro Mortgage Group Inc., 948 So.2d 45,46 (Fla. 4th DCA

2006) 37Reynolds v. State, 934 So.2d 1128 (Fla. 2006) 21Saporito v. Madras, 576 So.2d 1342 (Fla. 5th DCA 1991) 37Servedio v. US. BankNat. Assn, 46 So. 3d 1105 (Fla. 4th DCA 2010) 37Snelling & Snelling, Inc. v. Kaplan, 614 So.2d 665 (Fla. 2d DCA 1993) 28State. Department ofHealth and Rehabilitative Services v. Thibodeaux, 547 So.2d

1243 (Fla. 2d 1De 1989) 36Stone v. Bank, 115 So. 3d 411 (Fla. 2nd DCA 2010) 40Sunshine Chevrolet Oldsmobile v. Unemployment Appeals Commission, 910 So.2d

948 (FIa. 2d D’ 2005) 27Sykes v. Eastern Metal Supply. Inc., 659 So.2d 475, 477 (Fla. 4th DCA 1995) 317’ill,r,csrz v. Baskin, 260 So.2d 509 (Fla. 1972) .36I.J.D.cD. §1—201(44) 31t.i.c.ir. §3—403 31Verizzo v BankofN.1. 28 So.3d 976, 978 (Ha. 2d DCA 2010 37flarl7er-Lambert C’o. v. Patrick, 428 So. 2d 718 (Fla. 4th DCA 1983) 39Williams v. State, 666 So.2d 187 (Fla. 2d DCA 1995) 27Wilson v. Tanner, 346 So.2d 1077 (Fla. 1st 1)CA 1977) 21Yang v. Sebastian Lakes Condominium Association, Inc., No’s. 4D12-3363 and

4D12—3364 (Fla. 4th tDA 2013) 21Yisrael v. State, 993 So. 2d 952. 956-57 (Fla.. 2008) 28Zervas v. Wells Fargo Bank N.A., Case NO. 2D1 1-750 (FIa. 2d DCA July 18, 2013)

. 32

Iv

F”,

PREFACE

Defendants—Appellants, Taouflq Seffar and Hanan Seffar will he referred to,

throughout this brief, as “Seffar” or “Appellants”. Plaintiff—Appellee, Bavview Loan

Servicing, LLC, will be referred to as “Bavview” or “Appel lee”. The original

plaintiff in this case, Residential Credit Solutions Inc.. will be referred to as

“Original Plaintiff’ or “RCS”.

As used throughout this Brief the following symbols will be used:

_____)“

— Record, followed by page number;

“(A.

______

)“ —Appendix, followed by page number; and

iT. )“ — Transcript of hearing beftre the 1-lonorable Dale Ross, Judge of

the 17th Judicial Circuit, in and for Broward County, Florida, on September 12,

201 3, followed b page number.

STATEMENT OF THE CASE

On June 28, 2010, the Original Plaintiff, RCS, filed its Complaint for

mortgage foreclosure against Appellants [R. ]. Thereafter, on March 17, 2011,

Appellants filed their Answer and Af1rmative Defenses I R. j. Among their

defenses, Appellants challenged RCS’ ability to bring the action. The primary basis

of Appellants’ challenge was that RCS made no allegations concerning the chain of

title. The note and mortgage attached to RCS’ complaint named the lender as ABN

Amro IVIortgage Group, Inc. and purported to have been executed on October 1 6.

2006. [R. ]. While RCS attached an assignment from the FDIC as receiver for

FRANKLIN BANK, S.S.B. ç’FRANKLIN BANK”) to MERS as nominee for

RESIDENTIAL CREDIT SOLUTIONS, INC. (“RCS”),’ it did not attach any

documents to the Complaint that would allege the circumstances of the Note’s

alleged transferred from ABN Amro Mortgage Group. Inc. to Franklin Bank. As

such, the chain of assignments and/or endorsements of the Note and Mortgage was

broken, that is, the transfer from ABN to FRANKLIN BANK was not shown,

Moreover, the Complaint neither asserted that RCS owned nor held the note and

mortgage. Instead, it asserted that the RCS had “the right to enforce the mortgage”,

without alleging or disclosing from whence that right emanated.

On March 11, 2011, RCS filed what purported to be the original note and for

the first time the note was coupled with an al longe [R. j. The al longe was not dated

and appeared to have been endorsed “in blank” by one named Helene I)imitroffi

who was listed as the First Vice President of ABN AMRO MORTGAGE GROUP,

The facts surrounding the supposed assignment of the mortgage from theFDIC to RCS reflect that the “Attorney in Fact” lacked authority to execute thatassignment because the Limited Power of Attorney was not conferred upon her untilafter her execution of the Assignment of the Mortgage. In any event, the Appelleenever sought to introduce that Assignment as a trial exhibit.

2 The allonge was neither an exhibit to the Complaint nor was it attached to theNote when documents were produced to Seffar as he requested in a debt validationletter or in discovery.

INC. (“ABN”) [Declaration of Taoufiq Seffar ¶4(h)]. Review of the Notice of Filing

Original Note disclosed that the allonge did not appear to bear an original signature

but instead appeared to be stamped with a signature stamp. Additionally, the allonge

did not appear to be “permanently affixed” to the Note, particularly because it did

not bmaterialize until months after the action was filed.3

On October 19, 2011, RCS moved for summary judgment arguing that no

genuine issues of material fact remained with respect to its ability to bring suit [R. ].

On December 1, 2011, Appellants filed their Response and Opposition to RCS’

Motion for Summary Judgment asserting that because genuine issues of material

fact remained with regards to both RCS’ case-in-chief and Appellants’ affirmative

defenses, namely, RCS’ ability to maintain standing and that RCS’ Motion for

Summary Judgment should therefore be denied [R. 1.

On April 17, 2013, the trial court ordered that the Motion for Summary

Judgment be deferred and the matter set for trial [R. ]. On August 30, 2013, RCS

In a line of questioning regarding how RCS came to be the holder of the Note andMortgage at issue in this case, RCS’ corporate representative answered that she didnot know how the Note was transferred from ABN to Franklin Bank and had notseen any documents reflecting such a transfer. See M. Sequete depo., Nov. 28, 2011,p. 28—29. She also responded that she did not know how much RCS paid for theNote and that such information was not listed on RCS’ computer system. Id. at p.30. She further testified that she was not involved in the assignment of the mortgage.Id. at p. 38. It should also be noted that RCS’ corporate representative was unable tosay whether the allonge was transferred with the note or was even attached to thenote when it allegedly came into RCS’ possession, or whether the allonge or thenote that was filed with the court were “original” documents. Ii at p. 32—34.

3

filed its Motion to Substitute Party P1aintiff allegedly based upon an unsworn

service transfer from RCS to Bayview [R. ]. A hearing was held on September 10,

2014, two (2) days before trial was to commence to rule on RCS’ Motion to

Substitute Party Plaintiff [R. 1. Despite Seffar’s objections on the grounds of

prejudice, the trial court granted the motion and denied an ore tentis motion for trial

continuance [R. ][Tr. ]. The trial was held on September 12, 2013[R. 1.

On the day of trial, Seffar filed his Trial Brief and Motion for Involuntary

Dismissal pointing out to the trial court that there was no documentation or

testimony reflecting transfer from ABN to FRANKLIN BANK; that the Complaint

was filed with a note as an exhibit but with no allonge; that the corporate

representative of Bayview would not be the appropriate person to testify as to the

business records of RCS, the previous servicer and that the notice of default letter in

this case was insufficient to satisfy the conditions precedent required by the

acceleration clause of the mortgage. this motion was also orally argued at the close

of Bayview’s case [R. ijTr. 1.

The case proceeded and Bayview put on its sole witness, Mr. Ilosh

Azarsepandan, an employee of Bayview, to testify as to the business records of all

of the servicers that had allegedly serviced this loan — Citi, RCS and Bayview. [Ti’. 1

It was established through Mr. Azarsepandan’s testimony that he was neither the

4

records custodian for Bayview nor did he have personal knowledge as to the records

in the case [Tr. ]. As a result of his lack of competency in this regard, Seffar made

numerous objections on the grounds of foundation, hearsay and authenticity, which

are more fully set out in the ‘Statement of Facts” portion of this brief [Tr. ].

At the close of Bayview’s case, Seffar argued his Motion for Involuntary

Dismissal on the grounds that Bayview could not prove the requisite standing on the

basis that (a) Appellee did not put forth a competent witness; (b) the documents

presented lacked a proper foundation, were not authenticated, and constituted

hearsay, (c) the proof of indebtedness was inadmissible; and (d) the Notice of

Default ‘was defective [Tr. 63]. Seffar’s motion was denied [Tr. 73].

The case proceeded and Appellant put forth two witnesses. One of the

witnesses was Mr. Seffar who, among other matters, testified that he believed the

signature on the allonge was fraudulent [Tr. ]. The other testimony heard was

certain portions of the deposition testimony of RCS’ corporate representative, which

was read into the record [Tr. ]. After the witnesses testified and closings were

heard, the trial court granted judgment in favor ofPlaintiff [R. ].

5

STATEMENT OF THE FACTS

During the trial, the parties each put on one witness and Seffar also read into

the transcript portions of the testimony of the Original Plaintifrs RCS’) testimony.

Each of the witnesses’ testimonies will be addressed in turn.

a. Trial Testimony of Appellee’s Witness, Ilosh Azarsepandan

During its case-in-chiet Bayview put on Mr. Ilosh Azarsepandan to testify as

to the bank’s business records [Tr. 8—9]. Mr. Azarsepandan’s job description

included reviewing and managing the portfolio of litigated loans and mediations,

hearings and trials [Tr. 9]. 1-Ic indicated that Bayview was the servicer and holder of

the subject note [Tr. 9]. Before any business records were presented to the court, Mr.

Azarsepandan was asked about the individuals that entered the data that were the

subject of the business records [Tr. 9]. Appellant’s counsel immediately objected on

the grounds that there were no business records before the court at that particular

point in time [Tr. 10]. Appellant’s objections were overruled twice, at which point

counsel requested to you dire the witness [Jr. 10].

During voir dire, Mr. Azarsepandan admitted that he had come onto the case

approximately two months prior and that Bayview would not have had any business

records about this case [Jr. 10—Il]. The mortgage had previously been serviced by

two prior servicers, Citi and RCS [Tr. 14—15]. When asked who would have

generated business records about this case prior to that time, he admitted that it

6

would have been the prior servicer, RCS [Tr. 11]. The witness thereafter agreed that

he had not worked for RCS, was not the records custodian for RCS, nor was he

present at the time that RCS generated its business records [Tr. 1 1—12]. He thrther

admitted that he was not familiar with the policies of RCS as to how the records

were generated, did not know the people who created the records for RCS, nor was

he fbmiliar with the computer system that RCS used to generate the records [Tr.

12]? The witness agreed that to the extent that Bayview received RCS’ business

records, he took all of those records as being true; having no knowledge as to

whether the information was input correctly or not [Tr. 13]. He testified that he was

not the record custodian for Bayview and admitted that he could not vouch for the

accuracy of those records; only that he received them from the prior servicers [Tr.

14—15]. His testimony would be, in part, based on Citi’s records even though he was

not the records custodian for Citi [Tr. 15].

After Seffar’s voir dire of Bayview’s witness, Bayview proceeded with direct

examination and began by asking questions pertaining to the business records and

the individuals who were responsible for entering the data at the time when the

events occurred [Tr. 16]. Seffar’s counsel objected twice on the basis that the

witness lacked the requisite knowledge and therefore a foundation had not been laid

‘ Mr. Azarsepandan’s responses were the same as they related to servicing by CitijTr. 15—16].

Mr. Azarsepandan’s responses were the same as they related to servicing by Citi

7

[Fr. 1 61 7]. The court overruled counsel s objections [Fr. 1 6—1 7j. The witness was

then asked whether it was the regular practice of the bank to make and keep such

records [Tr. 1 7]. Seffar’s counsel objected on the basis of foundation and again his

objection was overruled [Fr. 1 7]. Ihe witness was asked i F the business records were

made in the ordinary course of the servicer’s business — an important question for

purposes of establishing a predicate for admitting records under the business records

exception [Tr. 1 7]. Seffar’s counsel objected as to foundation of that question and

while the objection was overruled, the question went unanswered [Ti’. 1 7]. During

direct examination, the witness was asked to describe the procedure b which

Bavview received the business records from the prior servicer. RCS [Ti’. 1 8]. The

\ itness responded that the prior servicer, including RCS, would send archives of

their books and records to Bayview and that the information contained within the

archives would then be uploaded into Bayview’s systems [Tr. 1 8].

Thereafter, the witness was presented with a copy of the note and the allonge

[Tr. 19]. At that point, Seffar’s counsel objected to the introduction of the

instrument on the grounds that it would need to be admitted into evidence before the

witness would he able to testify from it [Fr. 19]. Counsel indicated that because

objections had previously been made with regards to admitting the allonge into

evidence, he wanted to you dire the witness to determine whether a predicate could

[Tr. 15—16].

8

be established to admit the allonge [Tr. 19]. Nevertheless, over Seffar’s counsel’s

objection, the court permitted the witness to answer questions pertaining to the

allonge [Tr. 22—24]. Specifically. he was asked whether he knew when the allonge

was dated, whether the signature was a stamp signature, whether the allonge was

ever affixed on the note itselfprior to the time it was filed with the Court, whether it

was attached to the Complaint as an exhibit in this case, whether it was attached as

part of the original note [Tr. 2 1—23]. The witness answered all of these questions in

the negative [Tr. 21—22]. He testified that he first saw the original note immediately

prior to trial [Tr. 22]. He did not know when the allonge was executed [Tr. 22]. He

did not know if the signature on the allonge was a stamp or a wet ink signature [Tr.

23]. He did not know if the allonge was ever affixed to the note itself prior to it

being filed with the court [Tr. 23]. He indicated that the allonge was not attached to

the note as part of the complaint and that he did not know why [Tr. 23].

The witness was then asked about whether there was a purchase agreement

between Bayview and RCS [Tr. 25]. He responded that while he believed that such

an agreement was present, he had never actually seen it [Tr. 26]. Seffar’s counsel

objected to the admission of the note and allonge on the basis of foundation,

authenticity, and hearsay, but the court admitted the exhibit, overruling such

objections [Tr. 29].

9

Thereafter, the witness was asked questions by Seffar’ s counsel [Tr. 31]. The

first document that was presented to the witness was the servicing transfer notice

from Citi Mortgage to RCS (the “Goodbye Letter”) and he was asked to read the

highlighted portion of the notice [Tr. 31]. Seffar’s counsel objected on the basis that

the document was not in evidence, to which the court directed the witness to answer

anyway [Tr. 31]. Bayview’s counsel then requested that the letter be entered into

evidence under the business record exception [Tr. 32]. Seffar’s counsel objected on

the basis of hearsay, authenticity, and foundation, but the document was nonetheless

accepted [Tr. 32]. Seffar’s counsel indicated to the judge that, but for one letter from

Bayview. he would have the same objections to all of RCS’ records [Tr. 32].

Bayview then sought to introduce a letter from RCS, which essentially informed

Seffar that effective November 17, 2009, RCS would be providing the loan

servicing on the subject account [Tr. 32]. Another servicing letter was introduced.

which informed the addressee that the loan had been assigned, sold and transferred

from RCS to Bayview effective July 9, 2013, and which also included the right to

collect payments [Tr. 32]. The next document that was introduced was a letter from

Bayview which stated commencing July 9, 2013, Bayview would become the new

loan servicer (the “hello letter”) [Tr. 321.6

6 The “goodbye letter” and the “hello letter” shall be collectively referred to as the“hello/goodbye letters”.

I0

The witness was then asked some questions by Bayview’s counsel pertaining

to a “Notice of Intent to Take Legal Action” letter (“breach” or “default” letter) that

was sent by RCS to Sear. The witness indicated that he had not seen the original

copy of the breach letter, and that he did not have the return receipt for the certified

letter [Tr. 36]. The witness acknowledged that the loan number in the letter did not

match the loan number on the mortgage [Tr. 36—37]. The witness testified that he

was not familiar with how RCS sent out its default letters nor did he have personal

knowledge of whether the breach letter had actually been sent out [Tr. 37]. There

was nothing in his records that would confirm that Seffar received the default letter

[Tr. 37—3 8]. Based on the witnesses’ responses, Seffar’s counsel objected to the

breach letter on grounds of authenticity, foundation and hearsay [Tr. 38]. Bayview’s

counsel requested that the letter be admitted into evidence pursuant to the business

record exception [Tr. 38]. The Court admitted the exhibit [Tr. 38].

The “Notice of Intent to Take Legal Action” letter [R. J states, in part, “If

your loan is accelerated, you may have additional rights to cure the default under

your loan and may have the legal right to assert the non-existence of a default or any

other defense you may have to the acceleration and foreclosure...”. [R. J. The

language of this letter differs from the acceleration requirements contained in

paragraph 22 of the mortgage, which states that the borrower had “the right to

reinstate after acceleration and the right to assert in the foreclosure proceeding the

II

non-existence of a default or any other defense of Borrower to acceleration and

foreclosure.” [R. J. Additionally, the loan number referenced in the letter,

1000134984, is not the loan number for the loan which loan number listed on the

note and mortgage is 653880635 [Tr. 1•

On cross-examination, the witness was asked about information from the

computer system that RCS used to generate account statuses [Tr. 40]. With regards

to a particular part of the account status titled “corporate advances”, the witness

indicated that he had no specific information as to what the corporate advances were

for [Tr. 41—42]. Also, as it related to items called “expense advances”, he could not

explain what these were for [Tr. 42]. Seffar’s counsel thereafter objected to all of the

documents on the basis of foundation, hearsay and authenticity [Tr. 45].

The witness was then asked about where certain advance figures comprising

the amount on the draft final judgment came from, that is, what documentation were

those figures derived from [Tr. 47]. The witness did not know what they were [Tr.

48].

With regards to the assignment of the mortgage, the witness testified that the

mortgage was assigned on March 22, 2010 [Tr. 51]. He indicated that he had no

reason to believe that RCS was transferred the note prior to that date [Tr. 51] and

that because the default letter predated the assignment, RCS would not have been

the owner or holder of the note and mortgage by virtue of that assignment [Tr. 52].

12

Understandably so, he did not know who was the holder of the note at the time the

notice of default was sent out [Tr. 53] and stated that RCS brought the action as

servicer and not as owner and holder of the note and mortgage [Tr. 56]. He also

could not explain why RCS’ response to Seffar’s Request foi• Validation letter did

not contain a copy of the allonge {Tr. 57—58], and further stated that no allonge had

been produced in response to Seffar’s letter {Tr. 74—76].

Later on in the deposition, the witness testified that the FDIC had assigned the

mortgage to RCS after they took over Franklin Bank [Tr. 59—60], but that he did not

know how Franklin I3ank actually came into possession of the note and mortgage

[Tr. 60].

b. Trial Testimony of Party Witness, Taoufiq Seffar

Appellant Taoufiq Seffar took the stand during Appellant’s case—in-chief [Fi’.

73]. Seffar testified that he had conducted some research into the Vice President of

ABN AMRO Mortgage Group, Inc. (“ABN”), Helene Dirnitroff, and discovered that

she left ABN in 2007 [Yr. 76—77]. During his research, he began to question the

authenticity of the allonge because he believed that the signature on it was

fraudulent [Tr. 79]. He said that the signature on the allonge was a stamp [Tr. 79].

Seffar also questioned the amounts claimed because he determined that he was

After Seffar received the hello/goodbye letters from Bayview and RCS. he sent a

Request for\7alidation letter attempting to verify the servicing of the subject loan

[R.].

being double billed for insurance [Ti’. 80]. I-Ic was never able to determine what the

advances charged were for [Tr. 80].

c. Deposition Testimony of Melissa Alexis Seguet

As part of its defense, Seffar’s counsel read portions of the deposition

transcript of RCS’ corporate representative, Ms. Sequet [Tr. 82]. As the corporate

representative, she did not know how Franklin Bank came into possession of the

note and mortgage nor had she seen any document that would reflect such a transfer

[Tr. 86]. She testified that she did not know if the allonge was stapled to the original

note, but agreed, “it should have been” [Ti’. 88]. She also did not know if the

signature on the allonge was an original signature [Tr. 88] and could not explain

what the corporate advances were for [Tr. 90]. She testified that she did not know

whether she had received the return receipt on the default letter, but indicated that it

was RCS’ practice to retain them if they had [Tr. 93]. With regards to the note itself,

given that the last page of the note had plenty of room on it for an endorsement, Ms.

Sequet did not know why an allonge was used at all [Ti’. 941.

SUMMARY OF ARGUMENT

The trial court abused its discretion and erred in granting Bayview’s Motion

for Substitution two (2) days before trial without continuing the trial. The trial court

further erred by admitting Bayview’s evidence over Seffar’s objections after

Appellant’s voir dire of Bayview’s sole witness demonstrated that he lacked the

‘4

requisite foundational knowledge, capacity or familiarity to properly authenticate or

admit Bayview’s documentary evidence, nor was he properly a “records custodian”

such that he could overcome Seffar’s hearsay objections through the business

records exception. Such evidentiary rulings constituted harmful error because were

the trial court to have granted Seffar’s objections, Bayview would have had no

evidence in support of its allegations.

The trial court further erred by admitting, over Seffar’s objections, the

documentary evidence establishing the contested facts as to the mortgage and note,

notice of default and amount claimed to be due and owing. Such documentary

evidence was classic inadmissible hearsay not properly admitted pursuant to the

business records exception.

Finally, the trial court erred in denying Seffar’s Motion for Involuntary

Dismissal of the Complaint for Mortgage Foreclosure because even if the Court

were to credit all of the evidence adduced by Appellee, Appellee still never piovecl

essential allegations necessary to sustain its burden of obtaining a foreclosure

judgment on its Complaint - that it owns and holds the mortgage and that it

complied with all conditions precedent to the relief it was seeking.

STANDARD OF REViEW ON APPEAL

This appeal involves review of the Trial Court’s decision to grantial

judgment in favor of Appellee. To the extent that certain rulings were made

‘5

pertaining to determinations of law, the standard of review is de novo. FCD Dcv.,

LLC v. S. F/a. Sports Comm., Inc., 37 So.3d 905, 909 (Fla. 4th DCA 2010). Review

of a trial court*s ruling on the admissibility of evidence is based upon the abuse of

discretion standard. I? evno/ds v. State. 934 So.2d 1128 (Ha. 2006). That discretion.

however, is limited by the rules of evidence. Yang v. Sebastian Lakes Condominium

Association, inc., No’s. 4D1 2-3363 and 4D 12-3364 (Fla, 4th DCA 2013); P!?i/ippon

v. S/ire/f/er, No. 4D07-4 104 (Ha. 4th DCA 2010); Nationwide Miii. Fire ins. Co. v.

Bruscarino, 982 So.2c1 753 (Fla. 4111 DCA 2008); Hayes v. Wa/-Mart Stores, inc., 933

So. 2d 124 (FIa. 4th DCA 2006). The standard of review on appeal of the trial

courts ruling on a motion for directed verdict is de novo: it is the same lest used by

the trial court in ruling on the motion. Wi/son v. Tanner, 346 So.2d 1077 (Fla. 1 st

DCA 1977).

ARC t M E NT

I. REVERSAL IS REQUIRED WHERE TRIALCOURT ABUSES ITS DISCRETION BYPERMITTING SUBSTITUTION OF THEPLAINTIFF OVER DEFENSE OBJECTION TWO(2) DAYS PRiOR TO TRIAL.

On August 30, 2013, Original Plaintiff RCS filed a Motion to Substitute Party

Plaintiff [R. j. to which Seffar objected. [R.j. RCS’ motion was based on the

contention that because Bavview had allegedly been servicing the subject loan as of

6

July 9, 2013, it should be substituted for RCS as party plaintiff. At the hearing on

RCS’ Motion to Substitute Party Plaintiff held on September 10, 2013, Seffar raised

various issues pertaining to the motion, including prejudice to him from the filing of

the motion at the last minute as to his defenses relating to standing pertaining to the

previous servicer. [Sept. 10,2013 Hrg. Trans. at p. 4]. RCS’s counsel contended that

under Elston Leetsdale LLC v. CW Capital Asset, 87 So. 3d 14 (Fla. 4th DCA 2012),

the servicer was permitted to bring an action on behalf of the owner of the note.

[Sept. 10, 2013 Hrg. Trans. at p. 5].

Florida Rule of Civil Procedure 1.210(a) permits an action to be prosecuted in

the name of someone other than, but acting for, the real property in interest. A

servicer may be considered a party in interest to commence legal action as long as

the real party in interest joins or ratifies its action. Elston Leetsdale LLC, 87 So. 3d

16. To support a finding of standing by a servicer on behalf of the real party in

interest, this Court in Elston Leetsdale indicated that there would have to be

substantial evidence, affidavits or other documents supporting an allegation that a

servicer was authorized to prosecute an action on behalf of the real party in interest.

Id. at 17. Where a servicer relies on nothing more than its own allegations and

affidavit to support its argument that it has standing to sue on behalf of another, that

in and of itself is insufficient evidence. Id. at 17—18. In reaching its decision, this

Court relied on considerations taken into account by the Seventh Circuit in a case

17

captioned CWCapital Asset Mgmt., LLC v. Chicago Properties, LLC, 610 F3d 497

(7th Cir. 2010).

In CWCapital Asset Mgmt., LLC, the court found that a special servicer to a

loan had standing to bring an action in its own name against a mortgagor and

landlord. In that particular case, the special servicer filed an affidavit of the trustee,

which was not contradicted, thereby ratiing the servicer’s commencement of the

lawsuit. Id. at 502. Additionally, the pertinent pooling and servicing agreement was

placed in evidence as additional evidence that the servicer’s principal granted it

authority to enforce the debt instruments that the servicer neither owned nor held. id.

atSOl.

Similarly, in .Juega v. Davidson, 8 So. 3d 488 (Fla. 3d DCA 2009), a case also

relied upon by this Court in Elston Leetsdale LLC, the Third District reversed an

order of dismissal for lack of standing where the plaintiff in that case was deemed to

have been the agent who had been granted fUll authority to act for the real party in

interest. Juega, 8 So. 3d at 489. The court concluded that there was no violation of

rule 1.2 10(a) because there was ample evidence that the agent/plaintiff had been

granted fUll authority to act on the real party in interest’s behalf. Id.

Like Elston Leetsdale, but unlike CWCapital Asset Mgmt., LLC and Juega,

the original plaintiff here (RCS) did provide any substantial or compelling

evidence to support the contention that it had the requisite standing to bring a claim

18

against Seffar. While in paragraph 3 of its Complaint herein RCS alleged that it had

the right to enforce the note and mortgage, there was no allegation as to the identity

of the owner and holder of the note and mortgage from whom that right to enforce

allegedly derived. RCS’ standing was allegedly based upon its being authorized by

an undisclosed principal to act as its agent to enforce the note and mortgage. The

only “evidence” that RCS attached to its Motion was a letter it allegedly sent to

Seffar on June 13, 2013, informing him that the servicing was being transferred to

Bayview. However, that is just more of the same — that is, not actual evidence but

merely its own allegations. Lastly, RCS’ motion for substitution was unsworn and

only indicated that servicing of the note and mortgage had been transferred. again,

presumably by the unnamed and undisclosed principal that owned and held the note

and mortgage.

The requested substitution should have been denied because it was nothing

more than an attempt to cure the original plaintiffs standing deficiencies. The trial

court erred in granting RCS’ Motion to Substitute Party Plaintiff because it caused

prejudice to Seffar in that it was heard on the eve of trial and in that the ruling

presupposed that the original plaintiff had standing to bring the action against Seffar

in the first place.

IL REVERSAL IS REQUIRED WHERE TRIALCOURT ERRED IN OVERRULING APPELLANT’S

19

LACK OF FOUNDATION, AUTHENTICATIONAND HEARSAY OBJECTIONS TO APPELLEE’SDOCUMENTARY EVIDENCE AND TESTIMONY

The Mortgage and Note

As the Court instructed in Amos v. Gartner, Inc., 17 So.3d 829, 833 (Fla. 1

DCA, 2009):

Authentication of evidence is required as a condition precedent to itsadmissibility. See § 90.90 1, Fla. Stat. (2008). Evidence sufficient tosupport a finding that the matter in question is what its proponentclaims satisfies the authenticity requirement. See id. Extrinsicevidence of authenticity is required except for those documents whichare self-authenticating. See § 90.902(1 )-( 11), Fla. Stat. (2008). Exceptas provided by statute, hearsay evidence is inadmissible. See § 90.802,Fla. Stat. (2008). Where no proper foundation is laid, a record cannotbe admitted under an exception to the hearsay rule. See Lowe’s ofTallahassee v. Giaimo, 552 So.2d 304, 305 (Fla. 1st DCA 1989)(reversing JCC’s admission of records into evidence where foundationsatising rules of admissibility not established).

Mr. Azarsepandan, who testified about the purported business records in the

present case, lacked the necessary foundation to identi& the records and also lacked

the requisite knowledge for being considered a records custodian. Before a

document may be admitted as a business record, a foundation for such admission

must be laid. Mazine v. M&I Bank, 67 So. 3d 1129, 1129 (Fla. 1st DCA 2011). To

lay a proper foundation for the admission of a business record, it is necessary to call

a witness who can show that each of the foundational requirements set out in the

statute is present Charles W. Ehrhardt, Florida Evidence Sec. 803.6, at 585 (2d ed.

20

1991). Although it is not necessary to call the person who actually prepared the

document, the witness must have the necessary knowledge to testify as to how the

record was made. If the offering party does not lay the necessary foundation, the

evidence is not admissible under section 90.803(6). Id. See also Lowe’s of

Tallahassee v. Giaimo, 552 So.2d 304, 305 (Fla. 1 st DCA 1989) (affidavit failed to

make requisite showing to provide proper predicate for admission of doctor’s records

under section 90.803(6)). Forester v. Norman Roger Jewel! & Brooks Intern., Inc.,

610 So.2d 1369, 1373 (Fla. 1st DCA 1992) (being able to generally identify records

as the type of forms that a business or entity utilizes or completes is insufficient to

lay a proper foundation for the introduction of business records).

To illustrate, in Mazine, the bank had a regional security officer testify by

looking at files in the bank’s system and testifying as to the business records. The

officer’s duties were related to fraud and internal investigations. It was evident from

the circumstances that the officer had not been involved with the documents

personally. In that case, the witness admitted he had no knowledge as to the

preparation or maintenance of the documents offered by the bank. He further

indicated that he did not have any idea whether the information was input into the

bank’s system correctly nor could he vouch for the authenticity of any of the

information. He could not testify that the amounts owed were actually kept in the

regular course of business. He also did not know if the source of the information

21

contained in the affidavit was correct or whether the purported amounts \ere

accurate. Despite these unfavorable circumstances, the trial court admitted the

testimony and the records to come as business records. Defendant appealed the trial

court’s decision on the grounds that the circumstances proved that the officer did not

have the requisite knowledge to have been considered the records custodian. That,

coupled with the fact that there had been no attempt to admit the affidavit by

certification and declaration pL1rs1laI1t to Section 90.8036(c) of the Florida Statutes.

resulted in the First District reversing the case and entering judgment in favor of the

defendant.

Of particular relevancy and interest is a case captioned Kelsev v. SunTmust

\iortgage. inc. No. 3D 12-2994 (Ha. 3rd DCA, Feb. 12. 201 4). In Kelsci, the trial

court had allowed the appellee bank’s purported corporate representative to

authenticate documents without showing that she was a records custodian or that she

had personal knowledge of the documents. The bank subsequently filed a partial

concession of error with the appellate court, admitting that the trial court erred in

allowing certain documents given that they were hearsay without the proper

authentication. Id. The Third DCA agreed on the issue and remanded the case for

rehearing. Id.

Furthermore, as stated in The Florida Bar, Evidence in Fiomida §9.67 (7th ed.

2008):

The attorney should be careful to select the proper witness to qualify adocument under F.& 90.803(6). The witness should know how thebusiness generally operates and the usual procedure for preparing thetype of document involved. Failure to select a properly qualifiedwitness could result in the document being rejected as a businessrecord. See Sunshine Chevrolet Oldsmobile v. Unemployment AppealsCommission, 910 So.2d 948 (Fla. 2d DCA 2005) (although solewitness for employer at unemployment compensation hearing claimedto be custodian of records, failure to produce any testimony satisfyingthree foundational requirements for admission under F.S. 90.803(6)meant that hearing referee properly rejected records as inadmissiblehearsay); A.JD. v. State, 842 So.2d 297 (Fla. 3d DCA 2003)(probation officer was not custodian or otherwise qualified person totestify about preparation of school attendance records); Williams v.State, 666 So.2d 187 (Fla. 2d DCA 1995) (accused’s currentprobation officer, who had no personal knowledge of events alleged inviolations report by former officer, did not know if report was kept inusual course of business; thus, admission of report was error);McKenzie Tank Lines, Inc. v. Roman, 645 So.2d 547 (Fla. 1st DCA1994) (lab report showing that employee tested positive for cocaineproperly excluded in unemployment compensation hearing, becauseemployer did not make report in regular course of business and no onefrom outside testing lab had testified to lay proper foundation toqualify report under business record exception); Phillips v. State, 621So.2d 734 (Fla. 3d DCA 1993) (hospital nurse who admittedly wasnot custodian of proffered hospital records was not proper witness tolay foundation for them as business records); Snelling & Snelling, Inc.v. Kaplan, 614 So.2d 665 (Fla. 2d DCA 1993) (property manager ofparty wishing to withdraw funds from escrow account was not properwitness to lay foundation for party’s ledger books, because managerwas neither custodian of nor familiar with transactions recorded inledgers); King v. State, 590 So.2d 1032 (Fla. 1st DCA 1991)(probation officer was not custodian of Department of Correctionscomputer printout showing defendant’s release date for previousoffense and did not know how record was prepared).

23

Out-of-court statements offered to prove the truth of the matter asserted are

inadmissible unless the statements fall under a recognized exception to the rule

against hearsay. See § 90.802, Fla. Stat. (2013). All of the documentary evidence

introduced by Bayview8was proffered to be admissible under the business records

exception to the hearsay rule [Tr. ]. The Florida Supreme Court in dealing with

the business records exception to the hearsay rule recently stated in Yisrael i’. State.

993 So. 2d 952, 956-57 (Fla., 2008):

To secure admissibility under this exception, the proponent must showthat (1) the record was made at or near the time of the event; (2) wasmade by or from information transmitted by a person with knowledge;(3) was kept in the ordinary course of a regularly conducted businessactivity; and (4) that it was a regular practice of that business to makesuch a record. See, e.g., Jackson v. State, 738 So.2d 382, 386 (Fla. 4thDCA 1999). Additionally, the proponent is required to present thisinformation in one of three formats. First, the proponent may take thetraditional route, which requires that a records custodian take thestand and testi& under oath to the predicate requirements. See §90.803(6)(a), Fla. Stat. (2004). Second, the parties may stipulate to theadmissibility of a document as a business record. See, ag, Kelly v.State Farm Mut. Auto. Ins., 720 So.2d 1145, 1146 (Fla. 5th DCA1998) (holding that the parties stipulated to the admissibility of [993So.2d 957] medical records under the business-records exception); butsee Gordon v. State. 787 So.2d 892, 894 (Fla. 4th DCA 2001)(holding that the State and defense counsel’s stipulation regarding thedefendant’s release date was not sufficient to relieve the State of itsburden to prove the defendant’s release date by a preponderance of theevidence). Third and finally, since July 1, 2003, the proponent hasbeen able to establish the business-records predicate through acertification or declaration that complies with sections 90.803(6)(c)

Exhibits “1— “ [R. ].

24

and 90.902(11). Florida Statutes (2004). The certihcation—underpenalty of peijury--— must state that the record:

(a) Was made at or near the time of the occurrence of the mattersset forth by, or from information transmitted by, a person havingknowledge of those matters;

(b) Was kept in the course of the regularly conducted activity;and

(c) Was made as a regular practice in the course of the regularlyconducted activity[.]

§ 90.902(1 l)(a)-(c), Fla. Stat. (2004).

‘If evidence is to be admitted under one of the exceptions to the hearsay rule, it must

be offered in strict compliance with the requirements of the particular exception.’

Johnson v. Dep’! of Health & Rehab. Sen’s.. 546 So.2d 741. 743 (Fla. 1st DCA

1989). 1-lere, a records custodian did not appear as a witness j. the parties

did not stipulate to admissibility, and the Appellee did not provide a certiflcation

under Section 90.902(11) Fla, Statute (2013).

Much like in Marine as well as Kelse’, where the appellate courts ultimately

reversed the cases in favor of the defendant on the grounds that plaintiffs’ main

witnesses did not have the requisite knowledge to have been considered the records

custodian sand that the records were inadmissible as business records, here, none of

the requirements for admission of a business record were met by Ba view. The trial

hearing transcript is replete with objections by Seffar’s counsel regarding the

untrustworthiness of this evidence, namely that the proper foundation was lacking.

there was no authentication, and that the evidence constituted hearsay.

In this case, Bayview’s sole witness lacked knowledge as to the preparation or

maintenance of the documents offered. He testified that he did not work for RCS,

was never the records custodian for RCS, nor was he present at the time that RCS

generated its business records [Tr. 11—12]. He further testified that he was not

familiar with the policies of RCS as to how the records were generated, did not

know the people who created the records for RCS, nor was he familiar with the

computer system that RCS used to generate the records [Tr. 12]. The witness agreed

that to the extent that Bayview received RCS’ business records, he took all of those

records as being true; having no knowledge as to whether the information was input

correctly or not [Tr. 13].

With respect to whether the witness knew if the business records were made

in the ordinary course of the servicer’s business — an important question for

purposes of establishing a predicate for admitting records under the business records

exception, that question was never answered [Tr. 17].

The Note & Allonge

Of particular importance are the facts concerning the sudden appearance of an

allonge purporting to convert the note to a bearer instrument which are suspicious at

best and otherwise raise numerous factual issues concerning when, where, how, and

why such an allonge was created, how, when, whether and why it was affixed to the

26

Note, whether it was an original or not and whether the signature was real.

Fla. Stat. §673.4021(1 )(20 11) provides, in pertinent part, that “an

unauthorized signature is ineffective.” An unauthorized endorsement includes a

forgery. Moreover, “[a]n unauthorized signature also includes any endorsement

made without actual, implied or apparent authority.” Sykes v. Eastern Metal Supply,

Inc., 659 So.2d 475, 477 (Fla. 4th DCA 1995); Fla Stat. §671.201(44) (2011); see

also U.C.C. §1-201(44); Official Comment 1 to U.C.C. §3403. Indeed, “[t]here is

no presumption that the endorsements of a prior holder are genuine, and when

properly put in issue by the pleadings, the party seeking to establish the status of

holder of order paper must prove the validity of those endorsements on which his

status depends.” Ederer v. Fisher, 183 So.2d 39,41 (Fla. 2d DCA 1965).

Seffar consistently maintained and defended against the underlying

foreclosure action based on RCS’ failure to demonstrate negotiability of the

instruments at issue, including the allonge. Instead of attempting to reffite that

affirmative defense, RCS filed in the court file what was labeled, without any proper

testimony authenticating same, “the original note and allonge”. That allonge was

never attached to the complaint nor was leave of court ever sought to amend the

complaint to allege the existence of an allonge. Introduction of this document into

the court file was patently improper. Zervas v. Wells Fargo Ban/c N.A., Case NO.

27

2D 11-750 (Fla. 2d DCA July 18, 2013 ),9

During the trial, Seffar’s counsel challenged the admission of the allonge on

the basis of authenticity. Given that Seffar had put at issue the blank endorsement on

the supposed allonge and pointed out certain discrepancies to Bayview (e.g., the

dates surrounding the purported execution of the allonge, the fact that it was not

attached to the complaint, the fact that it appeared to be a signature stamp of

someone who was not even employed with ABN at the time the purported transfer

took place), Bayview was required to prove that the allonge was, in fact, dully

executed, when it was executed, and when it was transferred. Bayview did not offer

such proof and without adequate admissible proof of those facts, Seffar’s Motion for

involuntary dismissal should have been granted [Tr. 1 00].

In Zervas, the Cowi stated:

We also note that the mortgage and note attached to the complaint showthe lender to be Fremont Investment and Loan. On April 1 , 201 0,approximately six months after the complaint was filed, Wells Fargofiled a lost note affidavit, which alleged that the note was lost by itsattorney some time after the attorney received it on November 2, 2009.In their motion to dismiss, the Zervases alleged, among other grounds,that Wells Fargo did not have standing to bring the foreclosurecomplaint because it did not have a written assignment of the loan.Then on July 26, 2010, seven days before the hearing on the motion forsummary judgment, Wells Fargo filed the note as a supplementalexhibit to its complaint. The note contains an endorsement in blank, butthere is no evidence in the record establishing that the endorsement inblank was made to Wells Fargo prior to the filing of the foreclosurecomplaint. See Feitus v. U.S. Bank Nat ‘1 Ass ‘n, 80 So.3d 375, 377 n. 2(Fla. 2d DCA 2012) (holding that bank was required “to prove the

28

As grounds for his Motion for Involuntary Dismissal and during closing

arguments, Seffar emphasized that since he put at issue the blank endorsement on

the supposed allonge and pointed out the discrepancies regarding the dales and the

fact that the allonge was not attached to the Note, pursuant to Fla. Stat.

673,4O21(l), Bayview had the burden to prove the allonge was duly executed as

well as the date of the execution and the purported transfer. [Tr...].

The IZr/denee / Iiidehtedness

Even if Bayview were to argue that Mr. Azarsepandan was indeed a proper

“records custodian” for the documents, a fact which Mr. Azarsepandan himself

denied [Tr j, his testimony as to the amounts allegedly due under the Note

and Mortgage was based upon a proposed Final Judgment, apparently prepared by

his counsel which proposed Final Judgment fails to meet any of the predicate

requirements for a business record.

First, the proposed Final Judgment was not made at or near the time of the

events that it describes and is based upon other records which predate it, Second, the

proposed Final .Judgment was clearly made at the request of Appellee’s counsel for

submission to the Court at trial j R. ] [Tr. 1. )7si’ue! again counsels that:

a document is made for something other than a regularbusiness purpose, it does not fall within the business recordexception, and [w]henever a record is made for the purpose ofpreparing for litigation, its trustworthiness is suspect and should be

endorsement in blank was effectuated before the lawsuit was 1led”).

29

closely scrutinized,” Charles W. Ehrhardt, Florida Evidence 803.6,at 876 n. 3, 877 (2007 ed.) (citing, e.g.. United States v. Kim, 595 F.2d755. 760-64 (D.C.Cir. 1 979) (rejecting an argument that a documentcreated solely for litigation purposes was admissible as a business-records summary of otherwise admissible records. which were notproduced)).

Yisrael at 993 So. 2d 957. Similar to the telefax at issue in Kim, the proposed Final

Judgment at issue herein cannot be admitted as a summary of otherwise admissible

records, which were not produced. Yisi’ae/ at 993 So. 2d 957. Moreover, such a

document cannot form the basis for testimonial evidence of its contents,

notwithstanding the fact that it was not. itself, offered for admission. See ct/so

Thompson v. State, 705 So.2d 1046, 1048 (Fla. 4th DCA 1998) (“[T]he business-

records exception to the hearsay rule ... does not authorize hearsay teslinloiR

concerning the contents of business records which have not been admitted into

evidence.”); United States v. Marshal!, 762 F.2d 419, 423-8 (5th Cir. 1985)

The Deftiult Notice

One of the four (4) exhibits Bayview introduced into evidence is a purported

form letter allegedly providing notice of default to SelThrW. The letter is

inadmissible hearsay unless it is admissible under the business records exception to

the hearsay rule. Mr. Azarsepandan testified that he was not the records custodian of

the letter [T ]. Seffar did not stipulate to the letter’s admissibility nor did

30

Bayview provide a certification or declaration that complies with Sections

90.803(6)(c) and 90.902(1 1). Florida Statutes (2013). Accordingly, the letter is

inadmissible hearsay which was admitted improperly”.

Prejudicial — Not Harmless Error

The admission of Bayview’s exhibits — the Note, Mortgage, Affidavit and

Default letter was prejudicial to Seffar and was not harmless error because

Bayview’s entire prima facie case depended upon those documents. In a civil case,

an error is reversible—that is, harmful error—where “it is reasonably probable that a

result more favorable to Seffar would have been reached if the error had not been

committed.” Damico v. Lundberg, 379 So.2d 964, 965 (Fla. 2d DCA 1979).

Harmless error is not a device for the appellate court to substitute itself for the trier-

of-fact by simply weighing the evidence. The focus is on the effect of the error on

the trier-of-fact. The question is whether there is a reasonable possibility that the

error affected the verdict.” DiGuillo, 491 So.2d at 1139. Here, but for the

erroneously admitted exhibits, Bayview would have no evidence upon which to

saisiS its burden of proof. As such, such error cannot, by definition, be considered

“harmless”.

[R. ].The Third DCA has recently held an unsigned computer generated letter is not evidence of date

ofmailing. Baker i Florida Unemployment Appeals Commission, 35 Fla. L. Weekly Dli 88 (FIa.3d DCA May 26, 2010).

31

III. THE TRiAL COURT ERRED BY FAILING TOGRANT APPELLANT’S MOTION FORINVOLUNTARY DISMISSAL.

“An involuntary dismissal or directed verdict is properly entered only when

the evidence considered in the light most favorable to the non-moving party fails to

establish a prima /icie case on the nonmoving party’s claim.” McCabe v. Han/e),

886 So. 2d 1053, 1055 (Fla. 4th DCA 2004) (quoting Hack v. Estate ofHeiling, 811

So. 2d 822, 825 (Fla. 5th DCA 2002)). On a motion for involuntary dismissal, made

at the close of the plaintiffs case in a nonjury trial, a trial court is limited to

determining whether or not the plaintiff has made a prima facie case. Ti//man v.

Baskin, 260 So.2d 509 (Fla.1972) and State, Department of Health and

Rehabilitative Services v. Thibodeaux, 547 So.2d 1243 (Fla. 2d DCA 1989). The

court in making such a determination can neither weigh the evidence nor consider

the credibility of witnesses. Saporito v. Madras, 576 So.2d 1342 (Fla. 5th DCA

1991).

a. Appellee failed to prove that its predecessor held the note at the time theComplaint was filed, or was otherwise authorized to bring suit on behalf ofthe true holder.

“Whether a party is the proper party with standing to bring an action is a

question of law to be reviewed c/c novo.” FCD Dcv., LLC v. S. F/a. Sports Comm.

Inc., 37 So.3d 905, 909 (Fla. 4th DCA 2010) (quoting Westport Recoveiy Corp. v.

Midas, 954 So.2d 750, 752 (Fla. 4th DCA 2007)). The party seeking foreclosure

must present evidence that it owns and holds the note and mortgage at issue in order

to establish standing to proceed with a foreclosure action. Servedio v. US. Bank Nat

Ass ¶n, 46 So. 3d 1105 (Fla. 4th DCA 2010); Verizzo v. Bank ofN K, 28 So.3d 976,

978 (Fla. 2d DCA 2010); Phiogene v. ABNAmro Mortgage Group Inc., 948 So.2d

45, 46 (Fla. 4th DCA 2006). Where the defendant denies that the party seeking

foreclosure has an ownership interest in the mortgage, the issue of ownership

becomes an issue the plaintiff must prove. Carapezza v. Pate, 143 So.2d 346, 347

(Fla. 3d DCA 1962). The proper party with standing to foreclose a note and/or

mortgage is the holder of the note and mortgage or the holder’s representative. See

Mortgage Elec. Registration Svs., Inc. v. Azize, 965 So.2d 151, 153 (Fla. 2d DCA

2007); Troupe v. Redner, 652 So.2d 394, 395—96 (Fla. 2d DCA 1995); see also

Phiogene, 948 So.2d at 46 (Fla. 4th DCA 2006) (“[W]e conclude that ABN had

standing to bring and maintain a mortgage foreclosure action since it demonstrated

that it held the note and mortgage in question.”).

In regards to Bayview’s ownership and holding of the note and mortgage. the

Original Plaintiff alleged in its Complaint only that it “it has the right to enforce

the note and mortgage.” (emphasis added) [R , ¶3]. The Note and Mortgage

attached as an exhibit to the Complaint names the payee and lender as ABN

AMRO MORTGAGE GROUP, INC [R ]. Significantly, the Note attached as

33

an exhibit to the Complaint contained no allonge, nor was the Complaint ever

amended to allege the execution of an allonge or of the chain of title or assignments

of the Note and Mortgage [R......].

As the Second District stated in Feltus v. US. Bank Nat’! Ass’n, 37 Fla. L.

Weekly D253a (Fla. 2d DCA Jan. 27, 2012): “{w]e view U.S. Bank’s filing of a

copy of the note that it later asserted was the original note as a supplemental exhibit

to its complaint to reestablish a lost note as an attempt to amend its complaint in

violation of Florida Rule of Civil Procedure [190(a). U.S. Bank did not seek leave

of court or the consent of Feltus to amend its complaint. A pleading filed in

violation of rule 1.190(a) is a nullity, and the controversy should be determined

based on the properly filed pleadings. Warner-Lambert Co. v. Patrick, 428 So. 2d

718 (Fla. 4th DCA 1983).” Here the alleged original Note and Allonge were not

even filed as or alleged to be a ‘supplemental exhibit to RCS’ Complaint [R. ].

Curiously, the exhibits reflect an assignment from the FDIC as receiver for

Franklin Bank, but no exhibit reflects any assignment of the mortgage from the

payee and lender as ABN AMRO MORTGAGE GROUP, INC to Franklin Bank. It

was never alleged that Bayview’s predecessor RCS ever owned the mortgage.

Likewise, the record contains no competent testimony that Bayview owns the

mortgage nor was tlat fact ever even alleged. Moreover, there likewise is no

çyefçj testimony that Bayview holds the mortgage.

34

An action may be prosecuted in the name of someone other than, but acting

for, the real property in interest so long as the requirements of Florida Rule of Civil

Procedure 1.210(a) and applicable Florida law are met. See Corcoran v. Brady, 347

So. 2d 689, 690 (Fla. 4th DCA 1977). A servicer of a note would have to prove that

the owner and holder of the note and mortgage granted the plaintiff filing the action

the authority to do so once the action was commenced. Elston/Leetsdale. LLC v. CW

Capital Asset Mgmt. LLC, 87 So.3d 14 (2012) (citing In re Rosenberg, 414 B.R.

826, 842 (Bankr. S.D. Fla. 2009)).

In considering what would be sufficient to support a finding of standing by a

servicer on behalf of the real party in interest, the this Court in Elston/Leetsdale,

relied on the considerations taken into account by the Seventh Circuit in a case

captioned CWCapital Asset Mgm:., LLC v. Chicago Properties, LLC, 610 F3d 497

(7th Cir. 2010). In that case, the court found that a special servicer to a loan had

standing to bring an action in its own name against a mortgagor and landlord. In that

particular case, the special servicer filed an affidavit of the trustee, which was not

contradicted, thereby ratiiing the servicer’s commencement of the lawsuit. Id. at

502. Additionally, the pertinent pooling and servicing agreement was placed in

evidence as additional evidence that the servicer’s principal granted it authority to

enforce the debt instruments that the servicer neither owned nor held. Id. at 501.

35

At the trial in this case, Bayview relied on Stone v. Bank, 115 So. 3d 411 (Fla.

2nd DCA 2010), for the proposition that a party may establish standing in the

presence of a blank endorsed note assignment of a mortgage or evidence of

equitable transfer. Bayview argued that the evidence of equitable transfer were

certain letters purportedly showing that RCS was the receiver on November 17,

2009. Bayview argued that because Seffar sent a letter to RCS on April 9, 2010, that

fact constituted an admission that RCS was in fact the servicer. However, the

purpose of Seffar’s letter was to challenge the authenticity of the service transfer and

to request additional information concerning said transfer [R. Tr. 98]. Even taking

Bayview’s purported evidence as true, such a transfer of servicing letter is

insufficient to satis& the requirement for Bayview to provide competent, substantial

evidence pursuant to Stone.

In Stone, the court held that the transferee bank had standing to bring suit

because it had presented competent, substantial evidence that it owned the note and

mortgage. The evidence presented included testimony from one of its employees,

who worked for the original lender at the time that the property was seized and

placed into receivership and had remained an employee of the new bank, and

evidence of the receivership and a purchase assumption agreement. The employee’s

testimony was so compelling, given her personal knowledge of the particular loan in

question, that the court concluded that the argument that the allonge was indorsed in

36

blank and not affixed to the original note carried no weight in light of the testimony

demonstrating that the new bank acquired ownership of the note and mortgage

through the purchase assumption agreement.

The evidence provided by Bayview in this case does not nearly amount to the

evidence provided by the plaintiff in Stone. In this case, there was no authority put

into evidence to demonstrate that RCS was authorized to file suit as servicer of the

loan. A purchase and assumption agreement or a pooling and servicing agreement

was never presented.

Despite the lack of evidence that Bayview’s predecessor held the note at the

time the Complaint was filed, the trial court improperly denied Seffar’s Motion for

Involuntary Dismissal [Tr. 73].

Additionally, where a defendant raises the affirmative defense that the lender

failed to provide him with notice of the acceleration pursuant to the procedures

specified in mortgage, the lender must tender such proof. See Frost v. Regions Bank,

15 So. 3d 905, 906-07 (Fla. 4th DCA 2009) (“Because the bank did not meet its

burden to refute the Frosts’ lack of notice and opportunity to cure defense, the bank

is not entitled to final final summary judgment of foreclosure.”). Here, RCS’

allegations that it complied with conditions precedent were controverted by Seftar in

his answer and he also asserted an affirmative defense directed to that issue [R.

37

j. Bayview therefore was obligated to prove that the condition precedent to

foreclosure imposed by paragraph 22 of the Mortgage was satisfied.

b The alleged Notice of Default alleged to have been given by Appellee

was defective in that it failed to conform to the language set forth in

paragraph 22 of the Mortgage.

Bavview failed to satisfy that condition precedent because the language of the

letter did not track the language required to be placed in the Notice by paragraph 22

of the Mortgage because the letter quali1ed the foregoing statements with the word

“may” by saying: ““If your loan is accelerated, you may have additional rights to

cure the default under your loan and may have the legal right to to assert the non

existence of a default or any other defense you may have to the acceleration and

foreclosure, . . .“. In construing the notice of acceleration requirements, Florida courts

have stated that acceleration letters must satisfy the “clear and unambiguous”

conditions precedent to foreclosure by giving the required notice. See Konsidian v.

Bzisev Bank. 61 So.3d 1283 (Fla. 2nd DCA 2011) (The language in the mortgage iS

clear and unambiguous. The word “shall” in the mortgage created conditions

precedent to foreclosure, which were not satisfied). In fact, Judge Haury, Jr. of the

Seventeenth Judicial Circuit Court in I3ank of\:eu York Me//on v. Leslie. Case No.

CACE09032841 entered Summary Judgment for the Defendant by stating that the

language in an acceleration letter stating “you mciv have the right to bring a court

action.. .“ does not comply with the mortgage. (Order Granting Defendant’s Motion

for Summary Judgment is attached hereto as an exhibit).

c. Appellee failed to prove Notice of Default was sent to Appellant.

Bavview’s witness indicated that he had not seen the original copy of the

breach letter, and that he did not have the return receipt for the certified letter [Ti.

36]. The witness acknowledged that the loan number in the letter did not match the

loan number on the mortgage [Tr, 36—37]. The witness testified that he was not

familiar with how RCS sent out its default letters nor did he have personal

knowledge of whether the breach letter had actually been sent out [Tr. 37]. There

was nothing in his records that would confirm that Seffar received the default letter

[Tr. 37—38]. Based upon such testimony, Bavview’s proof of compliance with the

condition precedent of sending out a default letter was deficient. Where, as here, a

plaintiff fails to meet its burden of proof the iroper remedy is for the court to grant

a non-suit and dismiss the action with prejudice. It was error here for the trial court

to fail to do so.

CONCLUSION

Based on the foregoing facts and legal authorities, Appellants request this

Court to reverse the entry of the Final Judgment of Mortgage Foreclosure and direct

that the trial court enter judgment on the motion for involuntary dismissal made by

Appellant. Alternatively, Appellant requests this Court to reverse the entry of the

39

Final Judgment of Mortgage Foreclosure and remand this matter for a new trial.

David H. Charlip, B.C.S.Florida Bar No. 329932Charlip Law Group, LCCounsel for AppellantAventura Bayview Bldg.17501 Biscavne 131\IdSuite 510Aventura, Florida 33 160

‘CAiU3-.)3’+.}) 13

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dcharl ipI charl iplawaroup.corn

40

CERTIFICATE OF SERVICE

I HEREBY CERTIFY thai. a cop’ of the foregoing document was sent

via email to Raymond Hora, Esq.. McCalla Ravmer. LLC,

mrservice(mcca11araymer.com on this day of January, 2014.

I)AVID H. CHARLIP, B.C.S.

CERTIFICATE OF COMPLIANCE

In compliance with Florida Rule of Appellate Procedure 9.2 10(2), counsel for

Appellants certifies that the size and style of type used in this Brief is 14 point type.

Times New Roman.

DAVID H. CHARLIP, B.C,S.

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