Florida Appeals Court Says Mortgage Lender Need Not Pay Condo Maintenance Fees While Dragging Its Feet In Proceeding To Foreclosure Sale

A Florida appellate court recently issued the following decision reversing a lower court ruling that forced a foot-dragging, foreclosing mortgage lender to either proceed with a foreclosure sale or begin paying the monthly maintenance fee on the condominium unit securing its loan. In ruling in favor of the lender, it agreed with a 2009 decision of a sister appellate court that reached the same conclusion in a another case with the same fact pattern:

• On May 12, 2008, Deutsche Bank National Trust Company filed a mortgage foreclosure complaint, naming the unit owner, Dario Luna, as well as the Coral Key Condominium Association (at Carolina), Inc., as defendants. After seven months of no record activity, the Association filed a motion to compel Deutsche to proceed with the foreclosure sale or pay monthly assessments due to the Association. The trial court granted the motion, explaining that it was fair and equitable for the mortgage holder to pay monthly assessments due to the Association if there is an extended period of delay in the foreclosure proceeding for no good reason. We reverse.

• After the trial court entered the order appealed, the Third District issued U.S. Bank National Ass'n v. Tadmore, 23 So. 3d 822 (Fla. 3d DCA 2009), which addressed this precise issue. In Tadmore, the court rejected the notion that equity and fairness support an order requiring a bank to pay condominium assessments while foreclosure proceedings are pending since section 718.116(1)(b), Florida Statutes (2009), makes it clear that the first mortgagee is required to pay assessments only after acquiring title, and equity follows the law. Id. at 823-24. We agree with Tadmore and reverse.

For the ruling, see Deutsche Bank National Trust Company as Trustee v. Coral Key Condominium Association (at Carolina), Inc., 4D09-3392 (Fla. 4th DCA April 14, 2010).