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48 Legal Industry Update State Focus FLORIDA How Foreclosing Plaintiffs Are Held to a Higher Standard in Florida By Robert R. Edwards & Areeb Naseer, Robertson, Anschutz & Schneid, PL e statute of limitations for mortgage fore- closures in Florida is five years. From there it gets complicated. On August 26, 2016, Florida's Second District Court of Appeal (DCA) issued an opinion in Bollettieri v. BONY concluding that, provided a plaintiff alleged a "continuing state of default," it could both accelerate and recover for all amounts that became due within the five years preceding filing of the complaint, even if the initial default date alleged fell outside of that five years. In do- ing so, the Second DCA certified to the Florida Supreme Court a direct conflict with the Fifth DCA's opinion in Hicks v. Wells Fargo. In Hicks, Florida's Fifth DCA held that, where the initial default date alleged in the complaint fell outside the five years, the five year statute of limita- tions barred recovery of anything and warranted involuntary dismissal of the case in its entirety, even if the plaintiff had alleged a state of default continuing to within the five-year period. A closer analysis of this and related issues reveals how foreclosing plaintiffs are often held to a higher standard in Florida than are their counterparts in other types of civil litigation. One "perfectly acceptable practice" common to civil litigation is called "pleading in the alterna- tive." To plead in the alternative is to allege two or more (often inconsistent) theories, or statements of facts, under which the plaintiff is entitled to prevail, and then present the evidence at trial to determine under which theory, if any, the plaintiff can prevail. is is effectively what the plaintiffs did in Bollettieri and Hicks: ey alleged that the borrowers failed to make a payment due on a giv- en date (more than five years before suit was filed), and that they failed to make a payment on every due date thereafter (i.e., they alleged a "continuing state of default"). Accordingly, they could recover for amounts that became due within the five years prior to filing suit, and for future amounts due by virtue of acceleration triggered by a payment missed within the five years. It is the equivalent of filing a complaint with up to 59 counts on a 30-year mortgage—one for each missed payment and each demanding acceleration based on the payment missed. In such a case, the court could rightly find the plaintiff entitled to recover on some counts (i.e., those alleging a payment missed within five years), but not on other counts (i.e., those alleging a payment missed outside the five years). Not so though with Hicks where the Fifth DCA effectively precluded the foreclosing plaintiff from pleading in the alternative. Within the context of Florida foreclosure jurisprudence, however, Bollettieri is the anomaly, not Hicks. For example, a foreclosing plaintiff can prevail on several different theories of standing (e.g., as an "owner," as a "holder," or as a "non-holder in possession with the rights of a holder," etc.). But the Florida Supreme Court issued a foreclosure complaint form on January 14, 2016, prompting foreclosing plaintiffs to select at the outset one theory of standing on which to proceed, in part, the Supreme Court wrote, "to conserve judicial resources . . . being wasted on … inconsistent allegations." While technically not binding, the form provides a persuasive default value to lower courts such that, in practice, a plaintiff-mort- gagee is reluctant to allege alternative theories of standing. e Florida Rules of Civil Procedure further tighten the reigns by requiring foreclosing plaintiffs to verify foreclosure complaints under oath—something unheard of in other types of standard civil litigation. To verify a pleading in the alternative would approach confirmation by the verifier that he or she is equivocal about which theory of standing applies, possibly subjecting the verifier to sanctions. By contrast, the defendant- borrowers are not required to verify their plead- ings and can allege in defense, and with virtual impunity, anything they want to allege regardless of whether there is any basis for it in fact or law and regardless of whether their contentions are consistent. is leads into another unique facet of Florida foreclosure law. Instead of requiring defendants to raise and prove their affirmative defenses, the burden of overcoming affirmative defenses is often shifted to the foreclosing plaintiff who must now disprove affirmative defenses as part of its case in chief. Standing provides a prime example. It is well established that "[the lack of] [s]tanding is an affirmative defense that is waived if not raised in a responsive pleading," Collins v. Property Asset Management. As the Florida Supreme Court explained in Custer v. United Auto: An affirmative defense is an assertion of facts or law by the defendant that, if true, would avoid the action and the plaintiff is not bound to prove that the affirmative defense does not exist. e defendant has the burden of proving the affirmative defense . . . Notwithstanding the above, consider the following DCA quotations when it comes to foreclosures: A crucial element in any mortgage foreclosure proceeding is that the party seeking foreclosure must demonstrate that it has standing to fore- close. Elsman v. HSBC Bank USA

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