Opinion
Case No. 2D18-4848
03-25-2020
HSBC BANK USA, NATIONAL ASSOCIATION, AS Indenture TRUSTEE FOR PEOPLE'S CHOICE HOME LOAN SECURITIES TRUST SERIES 2005-4, Appellant, v. Charles C. ACHINELLI a/k/a Charles Achinelli; Jupiter House, LLC, Appellees.
Jacqueline J. Brown and Sean P. Belmudez of McCabe, Weisberg & Conway, LLC, Tampa, for Appellant. No appearance for Appellees.
Jacqueline J. Brown and Sean P. Belmudez of McCabe, Weisberg & Conway, LLC, Tampa, for Appellant.
No appearance for Appellees.
MORRIS, Judge.
HSBC Bank USA, National Association, as indenture trustee for People's Choice Home Loan Securities Trust Series 2005-4 (the Bank), appeals a final order dismissing a foreclosure complaint against Charles C. Achinelli and Jupiter House, LLC, the third-party purchaser of the property. Because we conclude that the trial court erroneously permitted Jupiter House to intervene in the case, we reverse.
Jupiter House purchased the property at a homeowners' association foreclosure sale on January 17, 2013. The Bank filed its foreclosure complaint and lis pendens on January 23, 2013. While the complaint and lis pendens were filed after Jupiter House executed the purchase documents for the property, the complaint and lis pendens were filed before the certificate of title was issued to Jupiter House on February 12, 2013. Jupiter House moved to intervene in the case, and the trial court granted the motion in July 2013. During the course of the proceedings, Jupiter House was named as a defendant, and ultimately, Jupiter House moved to dismiss the complaint, arguing that the Bank failed to prove standing to foreclose and also failed to prove the amount due. The trial court dismissed the case resulting in the order under review.
While this is not a complete recitation of the procedural history, only the facts relevant to the issue of intervention are necessary to this appeal.
We review the order involuntarily dismissing the Bank's complaint utilizing a de novo standard of review. See Ventures Tr. 2013-I-H-R v. Asset Acquisitions & Holdings Tr., 202 So. 3d 939, 942 (Fla. 2d DCA 2016).
Here, Jupiter House's purchase of the property was not completed until the certificate of title was issued. Thus Jupiter House was a purchaser pendente lite who was not a proper party to the foreclosure action. "A purchaser of property that is the subject of a pending foreclosure action in which a lis pendens has previously been recorded is not entitled to intervene in that foreclosure action." Bank of N.Y. Mellon for Certificateholders CWALT, Inc. v. HOA Rescue Fund, LLC, 249 So. 3d 731, 733-34 (Fla. 2d DCA 2018) (citing Bonafide Props. v. Wells Fargo Bank, N.A., 198 So. 3d 694, 695 (Fla. 2d DCA 2016) ); see also Ventures Tr. 2013-I-H-R, 202 So. 3d at 942-43 ; Whitburn, LLC v. Wells Fargo Bank, N.A., 190 So. 3d 1087, 1089 (Fla. 2d DCA 2015). This is so even where—as here—the purchaser begins the purchase transaction prior to the recording of the lis pendens, but the purchaser's interest is not recorded until after the recording of the lis pendens. See Harrod v. Union Fin. Co., 420 So. 2d 108, 109 (Fla. 3d DCA 1982) (holding that where purchaser's deed was executed prior to but not recorded until after the filing of a lis pendens, "the rule precluding intervention in a mortgage foreclosure action by a person who acquires an interest in the subject property after the recording of a lis pendens" applied); cf. 3709 N. Flagler Dr. Prodigy Land Tr. v. Bank of Am., N.A., 226 So. 3d 1040, 1042 (Fla. 4th DCA 2017) ("[T]he acquisition of title to property after the filing of a foreclosure complaint and notice of lis pendens does not confer on the title holder standing to intervene in the foreclosure proceeding, because the title holder's interest is clearly inferior, as a matter of law, to the interest of the foreclosing party." (emphasis added)).
We note too that even if the Bank had not recorded a lis pendens in the foreclosure action, Jupiter House would be charged with constructive notice of the Bank's superior interest in the property because the mortgage that formed the basis for the foreclosure action was recorded in 2005. Thus Jupiter House would have had constructive notice of a prior encumbrance on the property. See Whitburn, LLC, 190 So. 3d at 1091 (explaining that where bank's mortgage had been recorded seven years before legal title holder took property, the legal title holder was charged with constructive notice of the bank's superior interest in the property).
Consequently, the trial court erred in allowing Jupiter House to intervene in the foreclosure action and, as a result, erred in dismissing the action based on Jupiter House's motion. See HOA Rescue Fund, LLC, 249 So. 3d at 734. We therefore reverse the order dismissing the foreclosure action and remand for further proceedings in conformance with this opinion.
Reversed and remanded.
SILBERMAN and KELLY, JJ., Concur.