Lexology-

On February 13, 2018, the Florida Supreme Court accepted jurisdiction in an appeal emanating from a hot button issue in contested foreclosures – can the borrower in a foreclosure secure an award of contractual attorney’s fees after successfully defending the foreclosure on the basis that the lender lacked standing to enforce the mortgage contract?

Florida law follows the American Rule on attorney’s fees, i.e. the loser does not pay the winner’s fees, unless there is a basis in contract or statute that provides for fee shifting. The avenue for a borrower to secure attorney’s fees in a unsuccessful foreclosure is most often the mortgage’s fee shifting provision.

However, where the borrower successfully defends the foreclosure on the grounds that the lender lacks standing to enforce the mortgage, Florida’s District Courts of Appeal presently hold that the borrower cannot access the fee shifting clause. As one opinion on the issue states, what is good for the goose is good for the gander. If the lender lacked the necessary privity to enforce the mortgage against the borrower, so too there must be insufficient privity for the borrower to enforce the mortgage (specifically its fee shifting provisions) against the lender.

[LEXOLOGY]

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