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Articles Posted in Foreclosure Defense

We lost a trial in January of 2015 even though I thought we had a very clear winnable issue based on the “best evidence rule.” This rule is a fairly small body of law but it seems many lawyers and judges struggle to fully comprehend what it means and how it gets applied. In this case, the trial judge gave us ample time and consideration to make our argument. However, he ultimately did not agree with our position and entered final judgment against our clients. We appealed and the Fourth District Court of Appeal of Florida agreed with us. JUDGMENT REVERSED! CASE DISMISSED!

4th DCA Opinion Reversing Final Judgment & Remanding for Entry of Involuntary Dismissal

Trial Transcript

On or about March 13, 2009, our client, Mr. Julian Garvin, was called to active duty by the United States Army for one year, to begin on March 22, 2009. On March 26, 2009, he informed his mortgage servicer, JPMorgan Chase Bank, N.A., that he had been called to serve. Mr. Garvin provided a copy of his deployment order and asked them to reduce his interest rate, as required by federal law. No such adjustments were made. While on active duty, and for 11 months after his return, Mr. Garvin continued to make his full monthly payments. Then, at the peak of the crisis, he was unable to continue to pay.

On November 14, 2012, ALS-RVC, LLC, the entity claiming the right to foreclose, filed suit. The case went to trial and was involuntary dismissed, in part, because of ALS-RVC’s failure to adjust the interest rate as required by the Servicemember Civil Relief Act (SCRA). 50 U.S.C.A §3937. ALS-RVC appeals. In their Initial brief they concede the SCRA “applies to this situation, and [Mr. Garvin’s] loan payments should have been credited with a reduced interest rate during his active duty…” They also concede that “Subsection (e) of 527 is entitled ‘Penalty’ and reads, ‘Whoever knowingly violates subsection (a) shall be fined as provided in title 18, United States Code, imprisoned for not more than one year, or both.’ 50 U.S.C.A § 3937(e).” Yet, rather than trying to make amends for their admitted, jailable offense committed against a member of the United States Army, the bank and their lawyers appeal.

In the 80s, we were introduced to the phrase “trickle down economics.” From what I see in this and so many other cases, the only thing trickling down from Wall Street is fraud, greed, arrogance and a complete disregard for the rule of law.

This was one of our more complex cases.  Suit was filed in mid-May, 2009. There were ten trial orders setting the case for trial. Ultimately, trial started in February of 2015 and was spread out over three days, months apart. Finally, in June of 2015, trial was concluded – with a dismissal in favor of our client!

Here are the highlights of this great win for our war hero client:

When suit was filed, the Plaintiff didn’t attach even a copy of the note to Complaint, as is required by Florida Rule of Civil Procedure 1.130. Subsequent to filing suit, they filed a copy of a note with an allonge. We often “joke” in the industry that an allonge is a French word for fraud but it is legally defined as an indorsement to the note made on a separate piece of paper, which must be firmly affixed to the note. The Plaintiff later filed an “original” note but the “original” didn’t have that allonge. At trial, they suddenly claimed the allonge was lost.  After all this time, the Plaintiff never moved to amend their complaint to plead lost note and attach the note with a copy of the lost allonge.  There is an abundance of law which holds that the parties are bound to their pleadings.  The pleadings frame the issues for trial and, generally, what the Plaintiff pleads in their complaint, limits what they can raise and attempt to prove at trial.  Without a court order, agreement between the parties or implied consent, a party cannot suddenly switch their theory of recovery at trial for the first time.  Regardless, the Plaintiff never proved up any of the elements required to enforce a lost note.

Had another trial win recently – thankfully, we have been on a roll, winning multiple trials back to back to back! In this particular case, the original lender and the Plaintiff are Flagstar.  Attached to the Complaint is an unendorsed note, payable to Flagstar.  As is common in foreclosure cases, the Plaintiff substitutes in Green Tree a few months back and shows up at trial with note, endorsed, in blank.  I object to note as being outside the scope of the pleadings, citing to Holub v. Holub – parties are bound by their pleadings, and 1.130 – attachments to pleadings are considered a part of the pleading for all purposes.  Judge listens and goes back and forth but lets the note into evidence, with a smile to me. I think she’s hinting she knows this might later be a problem if the Plaintiff doesn’t move to amend their complaint and, more importantly, it could be a standing at inception issue.

After direct examination of the bank’s witness, Christopher Ly, a rigorous cross examination ensues resulting from him trying to be cute and not answer my questions.  I keep hammering him and the Judge never stops me.  Eventually, he capitulates and gives in, just in time for my cross on no evidence to show possession at inception, condition of note at inception and when the endorsements were placed on the note.  He wasn’t there when the note was endorsed, he didn’t see the endorsement placed on the note, he didn’t place the indorsement on the note, he didn’t possess the note at anytime, etc., and more….  that was fun.

After much argument, the Judge agrees the Plaintiff has not met their burden.  She agrees pleadings are not evidence, period, and will not make a “leap of faith,” as per Deutsche Bank v. Huber. (“However, this court does not make “logical and equitable” leaps of faith, as it cannot (and should not) make any such determination unsupported by the record before it.“) Beautiful!  The Plaintiff never proved who had possession at inception.  The only thing we know is there is now a note endorsed in blank and no one knows where the note was at any time prior to today.

A few years ago, great lawyers who are pioneers in our field, tried to blaze a trail alleging fraud in a foreclosure case. The case went all the way up to the Supreme Court of Florida. Despite finding that “many, many mortgage foreclosures appeared to be tainted with suspect documents,” the Court ultimately held that since the bank didn’t get away with it, it’s not fraud. Pino v. Bank of New York, 121 So. 3d 23 (Fla. 2013). The Florida Supreme Court would not even commit to stating that sanctions would be warranted for the bank’s attempted use of fabricated evidence. Id.

Before the case reached the highest court in our state, Justice Polen relayed the words of Justice Farmer, writing that:

Decision-making in our courts depends on genuine, reliable evidence. The system cannot tolerate even an attempted use of fraudulent documents and false evidence in our courts. The judicial branch long ago recognized its responsibility to deal with, and punish, the attempted use of false and fraudulent evidence. When such an attempt has been colorably raised by a party, courts must be most vigilant to address the issue and pursue it to a resolution.

We had a great win just before trial started recently. This was a very special case, referred by a friend. The client had a lot going on in her life, including a foreclosure judgment and the pending sale of her home.  She was successful in getting the sale reset three times but there was likely no judge in the world that would have reset it a fourth time.  The first thing we had to do was get that judgment vacated!  Based on a unique factual scenario, we found an angle and moved to vacate the judgment on the 363rd day after it was entered. We were really threading the needle on this but ultimately, we were on solid legal ground.  The judge agreed with us and we were successful in unwinding the clock. The judgment was vacated and the sale was cancelled.  We next amended our answer, fired off some discovery and then before long, the case got set for trial.

On the day before trial, the Plaintiff files a Motion for Continuance. They allege that the “servicing” was recently transferred. However, “Seterus has not received all the documents it needs from the prior servicer…” So, Plaintiff, now former servicer, is requesting a short continuance “to allow the current servicer additional time to complete the boarding process for the loan…” Plaintiff argues its position at the pre-trial docket sounding. I start my opposition to their Motion for Continuance stating that “this is a 2013 case. This is the second trial. Plaintiff noticed the Court that it was ready for trial and requested a trial date over a year ago. This second trial was set a few months ago. Even though the servicing transfer was effective a few months prior to the date of their motion, I’m sure this was in the works for some period of time prior to that. Yet, now, the day before trial, they move for continuance. What I find most disturbing is the basis, “boarding the loan.” “Judge, we’ve been in trial with the very witness Plaintiff will be calling in this case and in fact, every bank witness I’ve ever heard swears that boarding and verifying for accuracy is completed well before the servicing transfer is ever finalized. They often say something like, ‘the loan would not be transferred if everything is not checked and verified. Just the fact that I am here testifying indicates that the boarding was completed properly.’ Yet here we see, over two and a half months after the transfer of servicing has been completed, the Plaintiff is telling us that not only is boarding not complete, they still haven’t even gotten the documents! Something doesn’t sound right here…” The judge cuts me off, “I agree. Motion DENIED.”

We get called to start trial about an hour later only now, the Plaintiff’s sole witness is upstairs in a trial with Judge Tuter. Our trial judge asks opposing counsel(OC), “how many trials was your witness set for today?” OC says, “I don’t know.” The judge then immediately says, “I’m granting a very short continuance. I want you back here next week.” I ask for the following day and the judge says that’s fine by her. OC fills out the trial date request form for the clerk. I fill in my bar number and ask the clerk to confer with me before finalizing the date. I sit down, dejected, trying to accept that I am about to wait for my continuance date even though I almost had a very easy win. (I have a written admission via Plaintiff’s Motion for Continuance that there was no boarding or verification of the prior servicer’s data. There are no prior servicer records. The acceleration letter is addressed to the wrong address and there are two “original” allonges, with no staples attaching them to the note, all in the court file, filed 6 months ago.) I watch the judge call up the next pair to start their trial but then, within about 10 seconds, I feel as if something just picks me up by the seat of my pants. I rush back over to the clerk and say, “don’t reschedule our trial just yet. I’m going up to Judge Tuter’s courtroom.”

Strong words, so we’re gonna let the facts speak for themselves:


There is supposed to be only one Note…  At trial, the bank’s lawyer argued that standing at inception was established solely by comparing the indorsement on the “copy” of the Note filed with the initial Complaint with the indorsement on the Original Note, which was later filed with the Court. Specifically, he said:

. . .  to establish standing in this case is a simple matter.  The Plaintiff in this case — the original Plaintiff was OneWest Bank.  And OneWest Bank, upon filing the complaint, had a copy of the note attached to the complaint. This was promptly followed, Your Honor, with filing that same — the original note for that complaint.  The endorsements that were in the copy that was filed with the [Complaint] are the same endorsements that were in the original that was filed with [t]he Court. (emphasis added).

Just before trial starts, the Judge asks to see the file. She wants to review the Complaint and Answer. She takes a few minutes and then trial starts. Both sides waive opening statement – this is fairly common in foreclosure cases. After some brief preliminary questions, the Plaintiff seeks to move in the original note, indorsed in blank. I object – “it’s outside the scope of the pleadings. Plaintiff’s complaint, which was filed back in 2010, had no note attached and this was raised by the defense in the first answer, back in 2010 and TWO subsequent amended answers.” The Plaintiff’s attorney argued “as long as note is pled, they need not attach it to the complaint!” I remind the Judge of Florida Rule of Civil Procedure 1.130(a), titled “Instruments Attached.” It states, “[a]ll bonds, notes, bills of exchange, contracts, accounts, or documents upon which action may be brought or defense made, or a copy thereof or a copy of the portions thereof material to the pleadings, shall be incorporated in or attached to the pleading).” The Judge knew exactly what 1.130(a) stated and immediate said to the Plaintiff’s attorney, “I reviewed the pleadings just a few minutes ago and in 30 seconds I saw what you and your firm should have seen 4 years ago, and yet, you have done nothing to fix!”

The Plaintiff also never responded to or sought relief from our Request for Admissions(RFA) filed in 2010. I read out loud the key RFA’s into the record – “Plaintiff was not in possession of the note at inception of the lawsuit; Plaintiff did not have standing at inception; Plaintiff did not have the right to enforce the note.” There were a few others dealing with the Plaintiff’s failure to satisfy all conditions precedent to filing suit. I then approach and hand the Judge Professor Ehrhardt’s evidence book, turned to the pages addressing what he refers to as “judicial admissions.” No single author is more authoritative and accepted on the subject of evidence then Professor Ehrhardt. Every appellate court, including the Supreme Court of Florida has cited to him numerous times. I say, “judicial admissions are different from evidentiary admissions in that the former are uncontrovertible.” I also hand the Judge Florida Rule of Civil Procedure, 1.370(b) which states that matters which are not timely responded to are deemed admitted and are “conclusively established.” Plaintiff’s attorney stammers and admits she had no idea of this and disputes that RFAs were ever filed! I show her the docket entry which reflects that the RFAs were filing in 2010. Then, the Plaintiff’s attorney as part of her incoherent response says, “well the Defendant didn’t respond to the Plaintiff’s RFA’s either!” The only time I will interrupt opposing counsel in argument is when they state something as fact, which is just flat out not true. I don’t want them to taint the well and have me wind up in a mud fight. (In mud fights, both people have mud on their faces and no one knows who started it.) So, I cut her off immediate and say, “Judge, we got in this case in October of 2014. We saw that Defendant’s prior counsel had not responded some RFAs propounded to the Defendant. We immediately filed a motion seeking relief from those admissions, attaching proposed responses and we then quickly obtained an order granting such relief and deeming our responses timely filed. Plaintiff should have done the same!” Judge cuts me off, “I’m sustaining their objection! You had all this time to fix these issues and did nothing. The note is not coming in to evidence.”

At this point, I offer to the Plaintiff’s attorney, quietly, to take a Voluntary Dismissal and I’ll gladly agree it can be w/o prejudice, as this might help on some statute of limitations issues. She emphatically says no.

Without me saying a word, the Judge denies their motion. We wait around to be called up for trial. During which time, I watch the Judge, with a little unsolicited input from the “peanut gallery” (me), refuse to apply a recent Calloway case – a case which turns the evidence code on its ear. I informed the Defendant’s counsel during his argument that motions for rehearing and for certification were filed, therefore, the Calloway case is not final law. I hated to do it but the Judge was very seriously considering Calloway and I wanted to do all I could to prevent the well from being tainted! So, I was talking out loud a few times but ultimately whispered to Defendant’s counsel a few times and passed him some notes. The Judge asked Defendant’s counsel how he knew and he said a “little birdie told me.” The Judge looked right at me so I offered to show her the motions on my ipad but she said it’s was okay. Then she said, even if it the law was final, “the 4th is now legislating from the bench” and are trying to change the evidence code! Calloway conflicts with the 3rd. She asks what the case from the 3rd on this. I yell out Holt v Grimes. She says, right.  So, there is a conflict with the 3rd and I’m bound to follow the 3rd. She excludes the payment history. Plaintiff’s lawyer asks for continuance. Judge denies and then the bank takes a voluntary dismissal. Beautiful.

We go to lunch…

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