Roy D. Oppenheim, of Oppemheim Law in Weston. Photo: J. Albert Diaz/ALM.

A homeowner who prevailed in a foreclosure case missed out on an award of $104,700 in attorney fees and costs Wednesday, when the Fourth District Court of Appeal reversed a trial court's order allowing it.

The appellate panel found that because Farshadi Faramarz had used a lack of standing defense to get the lawsuit dismissed, that took away his right to fees.

Repeating a line from a previous opinion, the Fourth DCA stressed that “the borrower cannot have it both ways,” meaning they can't claim the financial institution lacks standing, but then use contractual links to obtain attorney fees from that same plaintiff.

The opinion certified a conflict with two cases in the Fifth District Court of Appeal, which found that borrowers were entitled to fees regardless of whether they'd used a lack of standing defense, because there was proof of a contract between the parties at trial. The Fourth DCA repeated its disagreement with those opinions, declining “to go down that rabbit hole.”

U.S. Bank N.A. brought the original lawsuit, but was substituted by Nationstar Mortgage LLC at trial. The defense argued there was no evidence that the original plaintiff, U.S. Bank, had possession of the promissory note when it filed the complaint.

Broward Circuit Judge Frank Ledee agreed, dismissing the case and finding that Faramarz was entitled to fees, adding, ”I don't know any argument against that,” according to Wednesday's opinion.

Nationstar appealed the award, arguing that the homeowner shouldn't get fees because he had succeeded on a lack of standing defense.

Faramarz's attorney Jonathan Kline in Weston and counsel to Nationstar Allison Morat of Bitman O'Brien & Morat in Maitland did not respond to a request for comment by deadline.

'Mark my words'

Roy D. Oppenheim of Oppenheim Law in Weston has practiced foreclosure defense and real estate law in New York and Florida for 32 years, and said this opinion signals dark days ahead.

“Mark my words,” Oppenheim said. “There will be remarkable unintended consequences for these kinds of outcome-determinative decisions, and they will have an impact that no one can envision right now. But they won't be good.”

The Florida Supreme Court will likely have to address the conflicts.

“It looks like this is becoming purely a political issue, and that's what's so shameful,” Oppenheim said. “The judicial branch, historically, has always done whatever it possibly could to not look political, and it's starting to look political.”

Oppenheim argues that if the lien on the mortgage is valid, then its accompanying attorney fee provision is too. And though the mortgage says attorney fee provisions are one way, Florida contractual law interprets them as going both ways.

He claims Florida is a nationwide outlier on this issue.

“There is no other state to my knowledge where a bank can drag you through the mud, foreclose on your property, request attorney fees and then say, 'Oops, we screwed up, but you're still not getting fees because our screw up was so bad we didn't even have a right to be in court in the first place,'” Oppenheim said.

Fourth DCA Judge Alan O. Forst wrote the opinion. Photo: Melanie Bell/ALM.

Wednesday's opinion relied on the Fourth DCA's ruling in Nationstar v. Glass, which found that no standing means no attorney fees. But it has a shaky history. The Glass case went to the Florida Supreme Court, which ruled in favor of the homeowner then spontaneously retracted that four months later, finding it didn't have jurisdiction to rule.

In the original Jan. 4 opinion, Florida Justice Peggy Quince — backed by Justice Jorge Labarga and retired Justices Barbara Pariente and R. Fred Lewis — addressed “the mischaracterization of the procedural history of this case by the district court.” But when Quince, Lewis and Pariente retired, their replacements had different interpretations.

Related story: In 'Bizarre' Flip, Florida Supreme Court Retracts Nationstar Attorney-Fee Ruling

How did the fees break down?

The trial court applied a multiplier of 2.0 to award Faramarz $96,100 in attorney fees and granted $5,000 for a fee expert and $3,600 in taxable costs, most of which came from the fee expert's deposition and preparation.

Defense attorney Kline billed $35,000 for 70 hours of work at $500 an hour, according to the trial court's final judgment, while a senior associate billed $11,500, a junior associate charged $4,000 and a paralegal $1,300.

Fourth DCA Judge Alan O. Forst wrote the opinion, with Judges Dorian K. Damoorgian and Burton C. Conner concurring.

 

Read the opinion:

 

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