Appeals court remands Wells Fargo foreclosure case for new trial

By David Hutton | Apr 14, 2017

PALM BEACH — The Florida 4th District Court of Appeals has sided with Wells Fargo Bank in its appeal of a judgment granting involuntary dismissal of a foreclosure case.

PALM BEACH — The Florida 4th District Court of Appeals has sided with Wells Fargo Bank in its appeal of a judgment granting involuntary dismissal of a foreclosure case.

In December 2010, Wells Fargo had filed a foreclosure complaint against Bryan and Mindy Ayers, et al. According to court records, the appeals court concluded that Wells Fargo waived any argument that the trial court erred in involuntarily dismissing the action before Wells Fargo rested its case. 

“However, because Wells Fargo submitted evidence in support of its lost note claim that was  sufficient  to  preclude  an involuntary dismissal, we reverse the final judgment and remand for a new trial,” the court wrote in its ruling.

After filing the foreclosure in 2010, Wells Fargo amended the complaint to include a count to reestablish the lost note.

The amended complaint also included a lost note affidavit, as well as a copy of the note, according to court records. The lost note affidavit stated that as part of the search for the lost note, Wells Fargo “check(ed) with (its) current and/or prior attorney.”

During the trial, the lone witness called by Wells Fargo was a bank employee whose duties included reviewing and verifying business records. The employee, a loan verification analyst, testified that in 2010, before the filing of the foreclosure suit, Wells Fargo sent the original note to its former attorney. The witness said that the note was lost at some point after it was sent to the attorney.

The witness also outlined the bank’s procedures for determining whether a note is lost. He said Wells Fargo would back-track and check all areas where a note could be, including with former counsel. He testified that the bank followed the same steps in the Ayers case.

The trial court then received a copy of the note without objection.

The Ayers’ counsel objected to the reestablishment of a lost note, arguing that Wells Fargo could not prove that the note was indeed lost.

According to the Ayers' lawyer, there was no direct evidence that Wells Fargo contacted its former attorney, who worked for a now-defunct law firm. He then asked the court for an involuntary dismissal because Wells Fargo had failed to prove its case.

The court agreed and asked the counsel if he was making the motion at that time.

“I would," the Ayers’ counsel said, according to court records. "Well, they haven’t concluded their case, so I will certainly wait for them, but I would move for an involuntary dismissal, Your Honor.”

The trial court allowed Wells Fargo to continue with its questioning, and the witness again confirmed that the bank followed its procedures to contact the former law firm to track down the lost note.

At that point, after questioning concluded, Wells Fargo’s counsel argued that the evidence established the note was lost.

After the Ayers’ counsel moved for an involuntary dismissal, there was a brief exchange, and the motion was granted.

The appeals court cited Williams v Salem Free Will Baptist Church, noting that the trial court had committed a procedural error by entering a directed verdict in favor of the plaintiff at the close of the plaintiff’s case but before the defendants had presented their case.

“We conclude that the trial court erred in granting involuntary dismissal based on its finding that Wells Fargo presented no evidence that it contacted its former counsel to determine whether the note was lost," the appeals court wrote in its ruling. "Wells Fargo did present unrebutted, competent evidence that it contacted its former attorney when searching for the lost note."

According to the appeals court, Wells Fargo’s witness testified that when a note cannot be found after it was sent to a law firm, Wells Fargo’s routine practice involves contacting that law firm and that it followed that routine practice in this case.

“This evidence was competent evidence of routine practice under Florida’s Evidence Code,” the court wrote. “It was sufficient to preclude an involuntary dismissal, as the trial court was required to view the evidence and all inferences of fact in a light most favorable to Wells Fargo, the nonmoving party.”

As a result, the appeals court reversed the final judgment entered upon the order granting involuntary dismissal and remanded the case for a new trial.

District Court of Appeal of the State of Florida Case 4th District No. 4D16-288

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