Monday, July 11, 2011

Fla. Appeals Court To Trial Judge: Pending Affirmative Defenses, Counterclaim Preclude Execution Of Judgment; Score Another Win For Pro Se Homeowners

A Florida appeals court recently granted another request to reverse an erroneous order granting summary judgment of foreclosure in favor of a lender, finding that allowing a subsequent foreclosure sale to proceed was erroneous because affirmative defenses and a counterclaim for fraud were still pending.

Palm Beach County Circuit Court Judge Meenu T. Sasser was the guilty trial judge in this basic screw-up involving fundamental issues of law.

For the ruling, see Peterson v. Affordable Homes of Palm Beach, Inc., 4D09-5180 (Fla. App. 4th DCA, June 29, 2011).

(1) In granting the request of a self-represented homeowner, the three-judge appellate court panel gave trial court Judge Sasser this lesson on basic Florida law applicable here:

  • "Courts have repeatedly held that, where summary judgment is granted for a plaintiff and a counterclaim remains pending, the trial court should stay the execution of the judgment pending the resolution of the counterclaim." Tooltrend, Inc. v. C.M.T. Utensili, S.r.l., 707 So.2d 1162, 1162 (Fla. 2d DCA 1998).

    "[T]he issue of fraud, raised by appellants as a defense and counterclaim, is usually considered a jury question and is not ordinarily appropriate for summary judgment proceedings." L & S Food Servs., Inc. v. Roberts Cafeteria, Inc.,
    422 So.2d 45, 45 (Fla. 2d DCA 1982). See also Millennium Group I, L.L.C. v. Attorneys Title Ins. Fund, Inc., 847 So.2d 1115, 1117 (Fla. 1st DCA 2003) (stating that when summary judgment is granted for one party and a counterclaim on an original claim remains pending, the trial court should stay the execution of the judgment pending the resolution of the remaining claim).

    Here, allowing the foreclosure action to proceed before deciding Peterson's counterclaim effectively denied Peterson the right to a jury trial, which she had demanded in her counterclaim. See Del Rio v. Brandon,
    696 So.2d 1197, 1198 (Fla. 3d DCA 1997). "The purpose of the compulsory counterclaim is to promote judicial efficiency by requiring defendants to raise claims arising from the same `transaction or occurrence' as the plaintiff's claim."

    Id. In Londono v. Turkey Creek, Inc.,
    609 So.2d 14, 20 (Fla. 1992), our supreme court explained "transaction or occurrence," using the "logical relationship test" in order to determine whether a claim was compulsory:

    A claim has a logical relationship to the original claim if it arises out of the same aggregate of operative facts as the original claim in two senses: (1) that the same aggregate of operative facts serves as the basis of both claims; or (2) that the aggregate core of facts upon which the original claim rests activates additional legal rights in a party defendant that would otherwise remain dormant.


    Here, Peterson's counterclaim alleged fraud on the part of Affordable Homes in connection with the purchase of the property. Her counterclaim was compulsory, as issues of fact which were "logically related" remained as to the liability of Affordable Homes. Thus final summary judgment of foreclosure should not have been ordered before the trial court considered it.

    We therefore reverse the order granting summary judgment and remand this cause for further proceedings.

Go here for links to some Florida case law on the staying of execution on a judgment while a counterclaim is pending.

While we're at it, a court's granting of summary judgment while discovery is pending is generally problematic for Florida appeals courts as well. See:

Payne v. Cudjoe Gardens Prop. Owners Ass'n, 837 So. 2d 458 (Fla. App. 3d DCA 2002):

  • Where discovery is not complete, the facts are not sufficiently developed to enable the trial court to determine whether genuine issues of material facts exist. See Singer v. Star, 510 So. 2d 637, 639 (Fla. 4th DCA 1987).

  • Thus, where discovery is still pending, the entry of Summary Judgment is premature. See Smith v. Smith, 734 So. 2d 1142, 1144 (Fla. 5th DCA 1999)("Parties to a lawsuit are entitled to discovery as provided in the Florida Rules of Civil Procedure including the taking of depositions, and it is reversible error to enter summary judgment when discovery is in progress and the deposition of a party is pending."); Henderson v. Reyes, 702 So. 2d 616, 616 (Fla. 3d DCA 1997)(reversing the entry of Summary Judgment where depositions had not been completed and a request for the production of documents was outstanding.); Collazo v. Hupert, 693 So. 2d 631, 631 (Fla. 3d DCA 1997) (holding that a trial court should not entertain a motion for summary judgment while discovery is still pending); Spradley v. Stick, 622 So. 2d 610, 613 (Fla. 1st DCA 1993); Singer v. Star, 510 So. 2d 637 (Fla. 4th DCA 1987).

Fleet Fin. & Mortg. v. Carey, 707 So. 2d 949 (Fla. App. 4th DCA 1998):

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