Court rules against homeowner in foreclosure fraud case

TALLAHASSEE, Fla. – Feb. 8, 2013 – Florida’s highest court on Thursday ruled basically, “no-harm, no foul,” in a closely watched ruling dealing with foreclosure fraud, forged documents and one of the nation’s largest banks.

In a unanimous ruling, the Florida Supreme Court upheld lower court decisions dismissing a case brought by a Palm Beach County homeowner against the Bank of New York Mellon, which was accused of using forged documents in a foreclosure action that began in 2008.

When homeowner Roman Pino challenged the document’s authenticity, the bank dismissed the case.

Pino contended the bank dismissed the case to hide the fact that it used bogus documents. He wanted the case reopened. The lower courts refused, saying Pino, who had reached an agreement with the bank, had not been harmed and the bank, though it may have avoided prosecution, didn’t gain anything from its decision. The high court agreed.

“In this case, because BNY Mellon did not obtain affirmative relief before taking the voluntary dismissal, the trial court did not have jurisdiction to reinstate the dismissed foreclosure action for the purpose of dismissing the action with prejudice,” Justice Barbara Pariente wrote for the court.

During arguments last fall, Pino’s attorneys argued that courts had an obligation to punish lenders and their law firms for forging foreclosure documents, a practice that came to light in 2010 as courts in Florida and other states dealt with a deluge of foreclosure proceedings.

Attorneys for the lender said Florida allows plaintiffs in civil cases to dismiss their cases up until a jury is selected for trial without interference from the court.

Both the trial court and 4th District Court of Appeal rejected the appeal, in large part because Pino had settled his case with the bank and was no longer involved in foreclosure proceedings – making the argument moot in the current case.

Mortgage lenders and others involved in the foreclosure process have closely watched the case. Florida led the nation in 2012 in percentage of foreclosure proceedings, with one in 32 homeowners involved in foreclosure.

In the 26 states that require foreclosure cases to go through the courts, the number of foreclosures is increasing, according to figures compiled by RealtyTrac.

gavelSource: News Service of Florida, Michael Peltier

Reprinted with permission. Florida Realtors®. All rights reserved.

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