Wednesday, June 13, 2012
Case Law Update
Drummond v. Welsh (In re Welsh), Means test allows debtor to deduct from current monthly income payments on secured debts; debtor need not take into account Social Security income to satisfy § 1325.
Deutsche Bank National Trust Company v. Clarke
The trial court entered a directed verdict in favor of the defendant, finding that the Plaintiff's failure to enter the original note and mortgage at trial was fatally defective to its case. During the course of the trial, the court inquired as to the location of the originals. "The original note had been filed with the clerk of the court and was in the court file in preparation for an earlier scheduled summary judgment hearing." The trial court stated it would accept the use of copies after being advised of the originals whereabouts. There was no objection to the use of the copies pursuant to the best evidence rule. Fla. Stat. § 90.953 (2010). The court reserved ruling and did not enter its order until the trial was concluded.
In overturning the trial court's order, the Fourth DCA not only made an evidentiary ruling, it also harmonized a series of cases addressing the need to tender the original documents to the trial court in foreclosure proceedings. Through its opinion, the Fourth DCA has held the tender of the documents to the court at any time during the foreclosure action should be sufficient.
McNeal v. GMAC Mortgage, LLC, Homecomings Financial, LLC
The holding in McNeal v. GMAC Mortg., LLC (In re McNeal), 2012 U.S. App. LEXIS 9589 (11th Cir May 11, 2012) is based on the concept that Dewsnup - which involved an attempt to cramdown a partially secured mortgage - did not overrule, explicitly, the Folendore decision. Accordingly, it remains good law, and a three judge panel cannot overrule an earlier three judge panel. The undercutting of the Folendore reasoning by the Supreme Court was not sufficient to allow lower courts to disregard binding precedent of the earlier 11th Circuit decision.
At present, stripping mortgages in Chapter 7 is permitted in the 11th Circuit.
Castillo v Deutsche, June 6, 2012
The Florida Third District Court of Appeals ruled on an issue that relates to borrower claims that an investor must establish compliance with its obligations under a Securitized Trust Agreement as a condition of enforcing a note and mortgage held by the trust. The Court ruled that the borrower does not have standing. This ruling is subject to a motion for rehearing and is not final but confident it will stand.