FL 2nd DCA: SPENCER v. DITECH FINANCIAL – Some-Evidence, No-Evidence Rule in Foreclosures

Are Florida’s Appellate Courts finally getting fed up with the lower courts allowing inadmissible evidence in foreclosure proceedings? Read Judge Salario’s Specially concurring opinion below, along with the full opinion attached and decide for yourselves.

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ISAIAH L. SPENCER and SHATIKA L. SPENCER,

V

DITECH FINANCIAL, LLC

CASE NO. 2D16-4817

ROTHSTEIN-YOUAKIM, J., Concurs. SALARIO, J., Concurs specially.

SALARIO, Judge, Specially concurring.

The Spencers argue in this appeal that the evidence was insufficient to sustain the judgment. They correctly point out that EverHome’s sole trial witness, Ms. Knight, lacked any personal knowledge of EverHome’s routine practice concerning the mailing of paragraph 22 letters and that without her testimony the evidence was insufficient as a matter of law to support a finding that such a letter was mailed to them. I agree with the reasoning of and the result reached by the majority, including the instruction that the trial court enter an order of involuntary dismissal instead of hold a new trial on remand, because I think as the majority does that both are compelled by our decisions in Edmonds, 215 So. 3d at 631, and Allen, 216 So. 3d at 688. See also Knight v. GTE Fed. Credit Union, 43 Fla. L. Weekly D348 (Fla. 2d DCA Feb. 14, 2018).

I write to express my growing unease with what we are saying in foreclosure cases about proceedings on remand when the plaintiff as appellee in our court has failed to prove at trial an element of or condition precedent to bringing the foreclosure action.

Outside the foreclosure context, our court routinely follows the general rule that a party that fails to meet its burden of proof in the trial court does not, when we reverse a judgment in its favor, get a second bite at the apple by way of a new trial or hearing on remand. See, e.g., Asset Mgmt. Holdings, LLC v. Assets Recovery Ctr. Invs., LLC, 43 Fla. L. Weekly D458 (Fla. 2d DCA Feb. 23, 2018); Airsman v. Airsman, 179 So. 3d 342, 345 (Fla. 2d DCA 2015); Carlough v. Nationwide Mut. Fire Ins. Co., 609 So. 2d 770, 771-72 (Fla. 2d DCA 1992) (citing In re Forfeiture of 1987 Chevrolet Corvette, 571 So. 2d 594, 596 (Fla. 2d DCA 1990)). This is as it should be: The interests of the parties and the judicial system in finality and in avoiding drawn-out, expensive, piecemeal litigation require that the parties and the courts regard the trial as the brass ring and not as the first step of an odyssey to an eventual result many proceedings away. See Carlough, 609 So. 2d at 772; Morton’s of Chi., Inc. v. Lira, 48 So. 3d 76, 79-80 (Fla. 1st DCA 2010). Thus, although we have departed from the rule when a party that won in the trial court was denied a fair opportunity to present its full case during the first trial, see Elder v. Farulla, 768 So. 2d 1152, 1155 (Fla. 2d DCA 2000), the default position is that there is no new trial when a party fails to prove its case and we reverse a judgment in its favor on appeal. My own inclination is that the interests served by the rule demand that a party present compelling equitable circumstances to justify a departure from this default position. See Morton’s of Chi., 48 So. 3d at 80. And I am inclined to adhere to that standard in circumstances where, as here, the party’s proof was rendered insufficient by our determination on appeal that the only evidence it offered to prove a controlling point on which it bore the burden of proof was not admissible.

Something different, however, seems to be happening in foreclosure cases. We have been determining whether to grant a new trial according to considerations that either appear alien to those that underlie the general rule or that are not clearly tied to a legal principle we can apply across cases (or both). For example, in cases where we reverse a judgment of foreclosure because a plaintiff failed to adduce legally sufficient evidence proving the amount of the defendant’s indebtedness—an element of its claim for foreclosure—our most recent cases hold that a new trial is proper where a plaintiff has introduced “some evidence” of that amount, either admissible or inadmissible, and that involuntary dismissal is required when it has “failed to offer any evidence” of that amount. Paeth v. U.S. Bank Nat’l Ass’n, 220 So. 3d 1273, 1275 (Fla. 2d DCA 2017) (emphasis in original) (holding that plaintiff was entitled to a new trial on the amount of indebtedness where it introduced some evidence of the amount, but the evidence was legally insufficient); see also Evans v. HSBC Bank, USA, Nat’l Ass’n, 223 So. 3d 1059, 1063-64 (Fla. 2d DCA 2017) (characterizing amount of indebtedness as “damages” and remanding for new trial where plaintiff presented “some” evidence of indebtedness, but the evidence was not admissible). The cases do not, however, explain whether or how this some-evidence-no-evidence test relates to the general rule against allowing new trials when a plaintiff fails to meet its burden of proof, the policies underlying that rule, or any compelling equity that would justify making an exception to it in a particular case. Nor do they explicitly state any principle that limits that test to a foreclosure plaintiff’s proof of the amount of indebtedness—as distinguished from, say, standing, default, or compliance with paragraph 22—or, indeed, that limits the test to foreclosure cases at all.

In other decisions, our consideration of whether to remand for a dismissal or a new trial when a foreclosure plaintiff has failed to prove its case appears to have hinged on whether the trial court erroneously admitted some evidence offered by the plaintiff. See, e.g., Heller v. Bank of Am., N.A., 209 So. 3d 641, 645 (Fla. 2d DCA 2017) (remanding for new trial where trial court erroneously admitted a copy of a note to prove its contents in violation of the best evidence rule); Sas v. Fed. Nat’l Mortg. Ass’n, 112 So. 3d 778, 780 (Fla. 2d DCA 2013) (remanding for new trial where proof of amount due was based on inadmissible evidence the trial court erroneously admitted). These are cases where, as here, had the inadmissible evidence not been admitted, the remaining evidence (if any) would have been insufficient to permit a judgment in the plaintiff’s favor.  Although we have not explicitly stated what considerations drive the result in those circumstances, allowing a new trial where the trial court has erroneously admitted some of the plaintiff’s evidence and the remaining evidence is insufficient might be linked to the notion that the plaintiff was denied a fair opportunity to present its case— i.e., that the trial court’s erroneous admission of some of the plaintiff’s evidence induced the plaintiff not to present other evidence that would have been admissible and that would have proved the same point.

But if that is the basis for these decisions, we have not said so. Nor have we explained why there should be a categorical distinction between pure sufficiency problems and admissibility problems that lead to sufficiency problems. On the contrary, other cases seem to suggest that determining whether a new trial is necessary in a case involving an admissibility issue that creates a sufficiency problem requires a fact- specific inquiry rather than a categorical rule. See, e.g., Mathis v. Nationstar Mortg., LLC, 227 So. 3d 189, 193 (Fla. 2d DCA 2017) (remanding for involuntary dismissal where trial court erroneously allowed witness to testify, over objection, to the contents of an allonge in violation of the best evidence rule and the original was not produced); Holt Calchas, LLC, 155 So. 3d 499, 507 (Fla. 4th DCA 2015) (remanding for involuntary dismissal where plaintiff’s only evidence that a paragraph 22 letter was sent was hearsay that was erroneously admitted over objection); Burdeshaw v. Bank of N.Y. Mellon, 148 So. 3d 819, 826-27 (Fla. 1st DCA 2014) (reversing foreclosure judgment based on an evidentiary error and remanding for order of involuntary dismissal where remand for new trial was inappropriate under the facts of the case).

This case provides a good example of why a categorical distinction between pure sufficiency and admissibility cases may not make sense. Here, it is hard to imagine that if the trial court had correctly excluded Ms. Knight’s routine practice testimony, EverHome would have been prepared to produce other admissible evidence that the paragraph 22 letter was mailed to the Spencers. It seems obvious that a person without personal knowledge of a party’s routine business practice cannot testify as to that practice or parrot the hearsay statements of others to establish it. See § 90.604, .802, Fla Stat. Yet Ms. Knight was the only witness EverHome decided to bring to the trial, and her testimony established that she had no knowledge to impart about the mailing of the paragraph 22 letter apart from her inadmissible testimony concerning routine practice. Had the trial court excluded that evidence, to which the Spencers contemporaneously objected, it seems quite certain that EverHome would simply have failed to prove compliance with paragraph 22. And had the trial court rendered a judgment of foreclosure notwithstanding that failure of proof, we would likely remand for an order of involuntary dismissal under the rule that a plaintiff that fails to prove its case does not get a second bite at the apple on remand. Granting a new trial here simply because the trial court admitted some plainly inadmissible testimony does not seem to protect legitimate reliance on a trial court’s evidentiary ruling; rather, it seems to reward either (or both) a litigant’s insufficient trial preparation or a strategic decision that it might be able to convince a court to admit clearly inadmissible evidence—precisely the kinds of results the general rule against granting a new trial when a party fails to prove its case the first time around is designed to avoid.

In the interest of brevity, I am oversimplifying a bit. There is more to our decisions on the scope of remand in foreclosure cases than this opinion allows. My point, however, is that we are making decisions about when a foreclosure plaintiff gets an involuntary dismissal or a new trial based on considerations that do not bear an obvious relationship to the rule governing the consequences of a party’s failure to meet its burden of proof that we apply in cases other than foreclosures and that we may not be able to limit to the foreclosure context on a principled basis. Someday, for instance, a lawyer is going to ask that we apply the some-evidence-no-evidence rule in a garden variety contract or tort case, a result we may well consider unadvisable. At least on the basis of what our opinions say, “that is a foreclosure rule” may be the only answer we are able to give for not extending it. But that answer is not going to be a credible or persuasive one. Speaking for myself, I would be open to examining these issues in an appropriate case as a full court with the object of settling on a general approach that we can apply on a principled basis across cases.

Full opinion with footnotes below…

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4closureFraud.org

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ISAIAH L. SPENCER and SHATIKA L. SPENCER, V DITECH FINANCIAL, LLC

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Comments
2 Responses to “FL 2nd DCA: SPENCER v. DITECH FINANCIAL – Some-Evidence, No-Evidence Rule in Foreclosures”
  1. William Peterson says:

    There are a bunch of folks that have been … more, or less, screaming about this for a decade. Meanwhile for the past decade courts have, in near lock step unison, routinely been disregarding long standing, and well established, doctrines, rules, statutes, and decisional law. At this point there is a new body of decisional law that will have to be undone.

    Judge Salario has only been on the bench since December 2014, or a little over 3 years.

    https://ballotpedia.org/Samuel_Salario

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