        DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                               FOURTH DISTRICT

           3709 N. FLAGLER DRIVE PRODIGY LAND TRUST,
                   MANGO HOMES LLC, as Trustee,
                            Appellant,

                                     v.

BANK OF AMERICA, N.A., DEREK HOVEY, JENNIFER HOVEY a/k/a
 JENNIFER COOK, CITY OF WEST PALM BEACH, FLORIDA, et al.,
                         Appellees.

                               No. 4D16-3255

                              [August 30, 2017]

  Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Donald W. Hafele, Judge; L.T. Case No. 2013CA014335
XXXXMB.

   Michael Farrar, Doral, for appellant.

   No brief filed for appellees.

PER CURIAM.

   Appellant challenges the trial court’s entry of final judgment of
foreclosure against its interest in the property which is subject to a
mortgage. The trial court concluded that appellant, which received title to
the property by quitclaim deed prior to the institution of foreclosure
proceedings, could not contest the appellee’s standing to bring the
foreclosure action. We hold that appellant was a proper party to the
proceedings; thus, the court erred in refusing to allow appellant to contest
the appellee’s standing to bring the foreclosure proceeding. We reverse.

   In 2009, the appellee Bank of America (“the Bank”) originally sought to
foreclose on a mortgage given to Amnet Mortgage Inc., d/b/a American
Mortgage of Florida, Inc., by Jennifer and Derek Hovey on property owned
by them. But in 2012, the Bank voluntarily dismissed the proceedings.
The Hoveys transferred title to 3709 N. Flagler Dr. Prodigy Land Trust (“the
Trust” or “appellant”) by quitclaim deed in August 2013. The next month
the Bank refiled its foreclosure complaint, but it failed to make appellant
a party. The lis pendens was filed after the transfer of title to appellant.
After securing a default final judgment, the property was sold and
certificate of sale issued in February 2015. Discovering the sale, appellant
moved to intervene and to vacate the sale and judgment. The court
granted the motion and vacated the final judgment. In June 2015, the
Bank refiled the complaint, adding appellant as a party. Appellant
answered and raised as an affirmative defense the Bank’s lack of standing
to enforce the note.

   At trial, the Bank asserted that appellant was not a party to the note or
mortgage, and thus should not be allowed to contest anything other than
damages at trial. Appellant contended that it had the right to contest the
Bank’s standing to foreclose on the mortgage. The court also mistakenly
believed that appellant was an intervenor instead of a party to the
proceeding. Citing to Whitburn, LLC v. Wells Fargo Bank, N.A., 190 So. 3d
1087 (Fla. 2d DCA 2015), the trial court ultimately reasoned that appellant
did not have standing to contest the Bank’s ability to foreclose. Further,
there was no finding by the court that the transfer of ownership to
appellant via quitclaim deed was done in an attempt to frustrate the timely
resolution of the foreclosure action. The court required the Bank to prove
only the amount of damages and did not entertain appellant’s arguments
on standing, nor did the Bank’s witness testify as to its standing. Although
the court was later apprised that appellant was indeed a party and not an
intervenor, the court did not change its ruling. After the final judgment of
foreclosure was entered, appellant appealed.

    “Standing is, in the final analysis, that sufficient interest in the outcome
of litigation which will warrant the court's entertaining it.” Gen. Dev. Corp.
v. Kirk, 251 So. 2d 284, 286 (Fla. 2d DCA 1971). An owner of property
must be joined in a foreclosure proceeding of that property in order to
make a decree of foreclosure valid. See Jordan v. Sayre, 24 Fla. 1, 3 So.
329, 330 (1888); see also English v. Bankers Tr. Co. of Cal., 895 So. 2d
1120, 1121 (Fla. 4th DCA 2005). In this case, the Bank recognized this
maxim by agreeing to the vacation of the original final judgment and
refiling the complaint to join appellant as a party to the case. Therefore,
there is no question that appellant had standing to contest the foreclosure
proceeding.

    The trial court relied on Whitburn for its ruling. There, Whitburn
acquired title to property after a foreclosure complaint and notice of lis
pendens was filed. Whitburn then sought to intervene post-judgment to
cancel the sale of the property. The trial court denied the motion on the
basis that Whitburn had no standing, and the Second District affirmed,
first noting that Whitburn was not a party to the foreclosure. In agreeing
that Whitburn had no standing, the court relied on the well-established

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principle “when property is purchased during a pending foreclosure action
in which a lis pendens has been filed, the purchaser generally is not
entitled to intervene in the pending foreclosure action.” 190 So. 3d at 1089.
(citations omitted). Therefore, because it did not acquire its interest until
after the filing of the lis pendens, it had no “sufficient stake in a justiciable
controversy, with a legally cognizable interest that would be affected by the
outcome of the litigation.” Id. at 1091 (citations omitted).

    We agree with Whitburn that the acquisition of title to property after the
filing of a foreclosure complaint and notice of lis pendens does not confer
on the title holder standing to intervene in the foreclosure proceeding,
because the title holder’s interest is clearly inferior, as a matter of law, to
the interest of the foreclosing party. In this case, however, the appellant
Trust acquired its title prior to the filing of the complaint and lis pendens
and was made a party to the proceeding. Thus, Whitburn is inapplicable.

   The trial court seized on language in Whitburn which we deem as mere
dicta. The court in Whitburn, in further attempting to buttress its
conclusion said, “We further point out that Wells Fargo's mortgage on the
property was recorded in 2006; therefore, even if Wells Fargo had not
recorded a lis pendens in its foreclosure action, Whitburn was charged
with constructive notice of Wells Fargo’s superior interest in the property.”
Id. While that is certainly true, as noted above an owner of property whose
interest was acquired before the filing of a foreclosure complaint and lis
pendens is an indispensable party to a foreclosure proceeding. The dicta
in Whitburn should not be read to conclude that any subsequent
purchaser would have no standing to contest a foreclosure proceeding,
even when the interest is acquired prior to the filing of the notice of lis
pendens. We do not think that the Second District intended such a result.
It merely noted that Whitburn’s interest would always be inferior to the
mortgage and thus another reason why post judgment intervention should
be denied. Thus, Whitburn is simply inapposite.

    The question, then, is whether appellant Trust can assert the
affirmative defense of lack of standing to bring the foreclosure proceeding.
The Trust obtained title to the property subject to the mortgage, no doubt.
Such a purchaser is estopped from contesting a mortgage which is valid
on its face. See Eurovest, Ltd. v. Segall, 528 So. 2d 482, 483 (Fla. 3d DCA
1988). But contesting standing of a plaintiff to bring a foreclosure action
is not contesting the validity of the mortgage itself. Further, if the plaintiff
does not have standing, it is not entitled to enforce the note and foreclose
on the property. Standing in a foreclosure proceeding requires the plaintiff
to show that it is the holder or is in possession of the note at the time of
filing suit. See Caraccia v. U.S. Bank, Nat’l Ass'n, 185 So. 3d 1277, 1279

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(Fla. 4th DCA 2016). A subsequent title owner may contest the plaintiff’s
standing to foreclose on the mortgage to the extent that there is no
prejudicial delay to the proceedings occasioned by any transfer of
ownership during the pending process. A subsequent purchaser has an
interest in assuring that the foreclosing plaintiff actually has the authority
to bring the suit and is entitled to raise such a defense so long as they do
not cause unreasonable delay to any ongoing proceedings. To hold
otherwise would allow a stranger to the note and mortgage to foreclose on
the property, and a subsequent purchaser would never have the ability to
defend against the taking of a bona fide interest in the property through a
foreclosure sale.

   Because we hold that the appellant was entitled to allege the Bank’s
lack of standing as an affirmative defense, the trial court erred in refusing
to allow appellant to assert this defense at trial and in entering final
judgment without the Bank establishing its standing to foreclose. We thus
reverse the final judgment for a new trial in which appellant’s affirmative
defense can be litigated.

   Reversed and remanded for further proceedings.

WARNER, CIKLIN and KLINGENSMITH, JJ., concur.

                            *         *         *

   Not final until disposition of timely filed motion for rehearing.




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