VENTURE HOLDINGS & ACQUISITIONS GROUP, LLC vs. A.I.M. FUNDING GROUP | FL 4DCA, (3) Consolidated Reversals “A.I.M. did not file the original promissory note” - FORECLOSURE FRAUD

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VENTURE HOLDINGS & ACQUISITIONS GROUP, LLC vs. A.I.M. FUNDING GROUP | FL 4DCA, (3) Consolidated Reversals “A.I.M. did not file the original promissory note”

VENTURE HOLDINGS & ACQUISITIONS GROUP, LLC vs. A.I.M. FUNDING GROUP | FL 4DCA, (3) Consolidated Reversals “A.I.M. did not file the original promissory note”

Great job! FL Atty Carol C. Asbury

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
July Term 2011

VENTURE HOLDINGS & ACQUISITIONS GROUP, LLC and VINCENZO GURRERA,
Appellants,

v.

A.I.M. FUNDING GROUP, LLC,
Appellee.
No. 4D10-832

REAL INVESTMENTS, LLC and ALEXANDER GONZALEZ,
Appellants,

v.

A.I.M. FUNDING GROUP, LLC,
Appellee.
No. 4D10-1159

REAL INVESTMENTS, LLC and ALEXANDER GONZALEZ,
Appellants,

v.

A.I.M. FUNDING GROUP, LLC,
Appellee.
No. 4D10-1848

[ November 23, 2011 ]

PER CURIAM.

In these consolidated appeals, appellants challenge three separate
final summary judgments of foreclosure entered in favor of appellee,
A.I.M. Funding Group, LLC. Appellants raise several arguments on
appeal, two of which merit discussion: (1) A.I.M., having assigned the
promissory note as collateral for a loan, was not the proper party in
interest to file suit, and (2) the trial court erred in granting summary
judgment for A.I.M. without receiving the original promissory note or
accounting for its absence. We find that because A.I.M. did not file the
original promissory note or account for its absence before the court
entered summary judgment, we must reverse the summary judgment
orders in each of the cases. We further find that A.I.M. lacked standing
to foreclose at the time it filed its complaints, but that some parties
waived the defense of lack of standing. Any remaining issues are
rendered moot by our decision and we decline to address them.

Factual Background

In April 2007, Venture Holdings & Acquisitions Group, Inc. and
Vincenzo Gurrera, individually, entered into a loan agreement with A.I.M.
and gave A.I.M. a mortgage on certain real property. Gurrera, Venture’s
president, signed the promissory note as a guarantor.

Likewise, Real Investments LLC entered into two loans with A.I.M, one
in January 2008 and another in May 2008. In connection with these
loans, Real gave A.I.M. a mortgage on two properties. Alexander
Gonzalez, Real’s president, signed the promissory notes as a guarantor.
There is no dispute that the borrowers failed to remain current on
their payments and defaulted on all three loans. Accordingly, A.I.M. filed
mortgage foreclosure actions on the three properties.

In Case No. 09-19636, A.I.M. sought to foreclose o n Venture’s
property. Gurrera filed a proper answer, but Venture did not. A.I.M.
moved for default against Venture and the court granted the motion.
This default has not been contested in this appeal.

In Case Nos. 09-018086 and 09-18089, A.I.M. sought to foreclose on
the two properties owned by Real. In Case No. 09-018086, Gonzalez filed
a proper answer, but Real did not. A.I.M. moved for a default against
Real and the court granted the motion. This default has not been
contested in this appeal. In Case No. 09-18089, however, both Real and
Gonzalez answered the complaint.

In each of its complaints, A.I.M. alleged that it “now owns and holds
the Mortgage Note and Mortgage.” Prior to initiating suit, A.I.M. assigned
its interest in the properties as collateral for a loan. This was indicated
by an allonge attached to each promissory note. The assignment was
still in effect when A.I.M. filed suit.1 The circuit court, in each case,
determined that no issues of genuine fact were raised by the defendants.
In each case summary judgment was entered against the defendants and
in favor of A.I.M. These consolidated appeals followed.

Analysis

“The standard of review of an order granting summary judgment is de
novo.” Allenby & Assocs., Inc. v. Crown St. Vincent Ltd., 8 So. 3d 1211,
1213 (Fla. 4th DCA 2009). We examine the record in the light most
favorable to the non-moving party. Id. The moving party must
conclusively show the absence of any genuine issue of material fact. Id.
An assignment of a promissory note or mortgage, or the right to
enforce such, must pre-date the filing of a foreclosure action. Jeff-Ray
Corp. v. Jacobson, 566 So. 2d 885, 886 (Fla. 4th DCA 1990). A party
must have standing to file suit at its inception and may not remedy this
defect by subsequently obtaining standing. Progressive Exp. Ins. Co. v.
McGrath Cmty. Chiropractic, 913 So. 2d 1281 (Fla. 2d DCA 2005). “The
assignee of a mortgage and note assigned as collateral security is the real
party in interest, that he holds the legal title to the mortgage and note,
and that he, not the assignor is the proper party to file a suit to foreclose
the mortgage.” Laing v. Gainey Builders, Inc., 184 So. 2d 897 (Fla. 1st
DCA 1966); see also A & B Discount Lumber & Supply, Inc. v. Mitchell,
799 So. 2d 301, 307-08 (Fla. 5th DCA 2001).

Here, before A.I.M. filed any of the foreclosure actions below, A.I.M.
assigned the promissory note and mortgage to a third party as collateral
for a loan. Thus, A.I.M. did not have standing to foreclose on any of the
properties at the time it filed suit. However, “th e entry of default
precludes a party from contesting the existence of the plaintiff’s claim
and liability thereon.” Fla. Bar v. Porter, 684 So. 2d 810, 813 n.4 (Fla.
1996) (citations omitted). Real, in Case No. 09-018086, was found to be
in default. Venture in Case No. 09-19636, was found to be in default.
Neither party may contest A.I.M.’s standing at the inception of the suit.
See Glynn v. First Union Nat’l Bank, 912 So. 2d 357, 358 (Fla. 4th DCA
2005) (holding that a homeowner waived any claim that the bank lacked
standing to foreclose where the homeowner never filed a motion or an
answer in the trial court).

But even a party in default does not admit that the plaintiff in a
foreclosure action possesses the original promissory note. See Lenfesty
v. Coe, 16 So. 277, 278 (Fla. 1894). “The decree pro confesso cannot be
extended to a confession of ownership of the note in complainant up to
the time of the master’s report and the confirmation thereof by the court,
and the authorities above cited sustain the view that a production of the
note or securities at the hearing is essential to show complainant’s right
to judgment then.” Id. A.I.M., in order to be entitled to summary
judgment, must establish that it is the proper holder of the promissory
note. Id.

In this case, A.I.M. failed to produce the original promissory note,
failed to account for its absence, and failed to present evidence to
otherwise establish it was the proper holder of the note. The allonge
established that the note was indorsed to a third party. A.I.M.’s failure to
produce the original promissory note, or account for its absence, created
a genuine issue of material fact. Lenfesty, 16 So. at 278. For this reason
alone, the summary judgments were improper in each of the cases.2

Accordingly, in Case No. 09-18089, we reverse the final summary
judgment and remand with directions that the action be dismissed in its
entirety without prejudice.

In Case No. 09-19636, we reverse the summary judgment and vacate
the final judgment of foreclosure. With regard to appellant Vincenzo
Gurrera only, we direct that the action be dismissed without prejudice.
With regard to Venture, however, we do not direct dismissal of the action.

In Case No. 09-018086, we reverse the summary judgment and vacate
the final judgment of foreclosure. With regard to appellant Alexander
Gonzalez only, we direct that the action be dismissed without prejudice.
With regard to Real, however, we do not direct dismissal of the action.
While A.I.M. is free to file the original promissory note and to move for
summary judgment in the actions that have not been dismissed as to
Venture and Real, we caution that the absence of Gurrera and Gonzalez
from those proceedings would leave those parties’ interests unaffected by
any judgment.

Reversed and Remanded.

TAYLOR, HAZOURI and LEVINE, JJ., concur.

* * *

Consolidated appeals from the Circuit Court for the Seventeenth
Judicial Circuit, Broward County; Ana I. Gardiner, Judge(Carol, please
check the judges in the other cases) ; L.T. Case Nos. 09-018086 CACE,
09-18089 08, and 09-19636 CACE.

Carol C. Asbury, Fort Lauderdale, for appellants.

Thomas D. Oates of the Law Offices of Oates & Oates, P.A., Pompano,
for appellee.

Not final until disposition of timely filed motion for rehearing.

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