For the past several years there has been confusion among Florida courts
about how the statute of limitations works in foreclosure cases. The main
point of contention is the point when a bank becomes time-barred from
filing a new foreclosure case after the first foreclosure case is dismissed.
In Florida, people have five years to collect an overdue debt. The debt
could be a medical bill, credit card, or a mortgage. If the person owed
the debt does not take any action to collect it within five years of the
time that it became due, the statute of limitations is over and that person
or entity will never be able to collect the debt.
In the context of mortgage foreclosure, there has been a debate between
the state’s district courts of appeal about when this statute begins
to run if there have been multiple foreclosure cases. In the Florida’s
Third District Court of Appeal (3rd DCA), which covers Miami-Dade and Monroe Counties, the counties’
trial courts previously followed an appellate case called
Deutsche Bank Trust Co. Americas v. Beauvais.
Beauvais, the bank filed for foreclosure against Harry Beauvais in January of 2007,
alleging that he had failed to make payments on his mortgage beginning
in September of 2006. That case was dismissed because the bank failed
to appear at a case management conference. Over five years later, in December
of 2012, the bank filed a new foreclosure case based on Beauvais’
missed payment from October of 2006.
In the second foreclosure case, Beauvais and his homeowner association
argued that Deutsche Bank’s case was barred by the statute of limitations
because the bank had failed to pursue a foreclosure within five years
of the time that the loan went into default and was accelerated. The trial
court agreed, and held that Deutsche Bank could not pursue its foreclosure.
The bank then appealed the decision to the 3rd DCA. The appellate court
confirmed the trial court’s decision, and held that absent a withdrawal
of the loan acceleration, the suit was time-barred.
Deutsche Bank requested a rehearing by a full panel of appellate judges. After an
en banc hearing, the 3rd DCA reversed its decision based on a 2004 Florida Supreme
Court case. The full panel of appellate judges held that multiple foreclosure
actions were permitted, and that the statute of limitations does not prohibit
the bank from filing a new foreclosure action based on a new default date.
Essentially, this ruling allows banks in the Miami area to avoid the statute
of limitations entirely by filing a foreclosure lawsuit based on any missed
payment within the previous five years. Homeowners whose foreclosure cases
were dismissed long ago can still be sued for foreclosure if their loan
is in default.
Beauvais ruling may not be the law for long. The state’s District Courts of
Appeal are in conflict about this issue, and the Florida Supreme Court
is expected to decide on how the foreclosure statute of limitations works
within the next few months.
For now, homeowners who are in default should not rely on the statute of
limitations to protect their homes. If your mortgage loan is in default,
you need to speak with an experienced foreclosure attorney as soon as possible.
At Loan Lawyers, our attorneys can help you create a plan to defend your
home from foreclosure. We can review the status of your loan and any pending
foreclosure cases, and advise you of your legal rights and options.
To schedule your free and confidential case review, contact Loan Lawyers
today by calling (888) FIGHT-13 (344-4813).