       DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                             FOURTH DISTRICT

DEUTSCHE BANK NATIONAL TRUST COMPANY, As Trustee For GSR
Mortgage Loan Trust 2006-OA1, Pass-Through Certificates, Series 2006-
                               OA1,
                            Appellant,

                                    v.

                        FLEMING HARRIS, et al.,
                              Appellees.

                             No. 4D19-2812

                            [August 12, 2020]

   Appeal from the Circuit Court of the Seventeenth Judicial Circuit,
Broward County; Frank Ledee, Judge; L.T. Case No. CACE-15-12995.

   Shawn Taylor and Brandi Nicole Wilson of DeLuca Law Group, PLLC,
Fort Lauderdale, for appellant.

  Bruce K. Herman of The Herman Law Group, P.A., Fort Lauderdale, for
appellee Harris.

CURLEY, G. JOSEPH, Associate Judge.

    Deutsche Bank National Trust Company, (“Deutsche Bank”) appeals
the trial court’s Final Judgment based on lack of standing in favor of
appellee Fleming Harris (“the borrower”). Deutsche Bank also appeals the
trial court’s order denying Deutsche Bank’s motion for rehearing. We
reverse and remand for further proceedings.

                                Background

    As Trustee for GSR Mortgage Loan Trust 2006-OA1, Pass-Through
Certificates, Series 2006-OA1, Deutsche Bank filed a verified mortgage
foreclosure complaint, seeking to foreclose a mortgage on the borrower’s
property. The mortgage secured a note in the amount of $220,000.00 to
the original lender, Solutions Funding, Inc. Deutsche Bank attached a
copy of the note to its complaint that included two indorsements: the first
from the original lender, Solutions Funding, to IndyMac Bank, F.S.B.
(“IndyMac”), and the second from IndyMac to blank.
   In his answer and affirmative defenses, the borrower claimed that
Deutsche Bank lacked standing.          The borrower asserted that the
indorsement from IndyMac in blank was anomalous because IndyMac
ceased to exist as of January 2008. The borrower suggested that the
indorsement was made between March 21, 2011, and September 18, 2013.
The borrower offered a different copy of the note that was included with a
prior foreclosure action in which the indorsement from IndyMac in blank
did not appear. The borrower argued the possibility that IndyMac may not
have been in existence when the note was indorsed. The borrower asserted
that “the indorsement is an anomalous indorsement and may be
fraudulent.”

   At trial, Deutsche Bank presented testimony from a loan servicer on
the history of the note. Among other things, the loan servicer testified that
a previous servicer, One West Bank (the “first servicer”), had serviced the
note following a merger with IndyMac. When asked whether previous
copies of the note contained the indorsements by Solutions Funding to
IndyMac and from IndyMac in blank, the loan servicer testified that many
copies of the note contained those indorsements and that he had seen
multiple copies of the note which had been imaged into the servicing
processing systems.

   Deutsche Bank also asserted that it was entitled to use Ortiz v. PNC
Bank, N.A., 188 So. 3d 923, 925 (Fla. 4th DCA 2016), to demonstrate
standing because it possessed the original note indorsed in blank which
was an exact copy of the note attached to its complaint. The borrower
asserted that proof of an anomalous indorsement would trump Ortiz.
Deutsche Bank countered that the borrower failed to prove his fraud
defense and had offered only speculation that the note was indorsed in
blank only after IndyMac ceased to exist based on a prior case complaint
that attached a different copy of the note. Moreover, Deutsche Bank
argued it established standing through the testimony of the loan servicer
that he had seen the note indorsed in blank and the establishment of the
Ortiz presumption. No testimony was offered by IndyMac or any other
witnesses that the indorsement was unauthorized or otherwise
anomalous.

   The trial court ruled that Deutsche Bank lacked standing due to an
anomalous indorsement.          The trial court held that because the
indorsement did not specifically give the first servicer the ability to enforce
the note, “that particular [i]ndorsement fails and it is, for all intent[s] and
purposes, an anomalous [i]ndorsement.” In the trial court’s view, due to
what it believed was an anomalous indorsement in blank, the only party
who could have acted on the note was IndyMac.


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    Deutsche Bank filed a motion for rehearing and argued it had produced
competent evidence of standing because the note was indorsed in blank.
In the same motion, Deutsche Bank also argued that the borrower had
offered only speculation to meet his burden of proof to show the
indorsement was unauthorized or fraudulent when made, as he had
specifically pled in his affirmative defense.

   The trial court denied the motion for rehearing.

                                   Analysis

    The borrower argues the trial court properly found that the note had
an anomalous indorsement. Deutsche Bank maintained its position that
it possessed standing because the note had a blank indorsement and the
holder of a blank-indorsed note should have been presumed to possess
standing under Ortiz. Deutsche Bank also asserted that the borrower’s
evidence was nothing more than speculation premised on a complaint from
an earlier case, which should have been disregarded in the face of the loan
servicer’s testimony and Ortiz.

   In a foreclosure proceeding, where the trial court’s findings are based
on fact, the standard of review is abuse of discretion while any legal
conclusions are subject to de novo review. Gonzalez v. Fed. Nat’l Mortg.
Ass’n, 276 So. 3d 332, 335 (Fla. 3d DCA 2018).

   A holder is “in possession of a negotiable instrument that is payable
either to bearer or to an identified person that is the person in possession.”
§ 671.201(21)(a), Fla. Stat. (2019). “[I]f an instrument is payable to an
identified person, negotiation requires transfer of possession of the
instrument and its indorsement by the holder. If an instrument is payable
to bearer, it may be negotiated by transfer of possession alone.” §
673.2011(2), Fla. Stat. (2019).

   A signature, “regardless of the intent of the signer,” is an indorsement
unless the instrument unambiguously indicates the intent was to not sign
as an indorser. § 673.2041(1), Fla. Stat. (2019). The signature on an
indorsement is presumed to be authentic and authorized. § 673.3081(1),
Fla. Stat. (2019).

   “When indorsed in blank, an instrument becomes payable to bearer
and may be negotiated by transfer of possession alone until specially
indorsed.” § 673.2051, Fla. Stat. (2019).




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   An indorsement “made by a person who is not the holder” of the note
is an “anomalous indorsement.”      § 673.2051(4), Fla. Stat. (2019).
However, “[a]n anomalous indorsement does not affect the manner in
which the instrument may be negotiated.” Id.

   The trial court improperly found that the indorsement of the note was
an anomalous indorsement. Although the borrower claimed that the
note’s second endorsement made by IndyMac in blank could not have been
made by the note’s holder because IndyMac did not exist at the time the
indorsement was made, the indorsement made by IndyMac had no date.
The borrower offered only speculation as to when the indorsement was
actually made. The borrower offered no specific evidence that the
indorsement was not made at an earlier time when IndyMac was in
existence. On the other hand, Deutsche Bank offered evidence of the
existence of the note’s proper and timely indorsement and also relied on
the Ortiz presumption, under which Deutsche Bank filed a copy of the note
with blank indorsements and produced an identical, original copy of the
note. Deutsche Bank was in fact the holder of an instrument payable to
bearer. See § 671.201(21)(a).

   Moreover, an instrument with an anomalous indorsement does not
alter the negotiation of the instrument. See § 673.2051(4). If the
instrument were payable to an identified person, negotiation would require
indorsement by the holder. See § 673.2011(2). The indorsement on the
note was made from IndyMac in blank, meaning the holder’s indorsement
was no longer required for negotiation. Because the note contained an
indorsement in blank from IndyMac, Deutsche Bank was free to negotiate
the instrument because it possessed the original note. See § 673.2051(2).

    Additionally, an anomalous indorsement does not affect the manner of
negotiation. See § 673.2051(4). An anomalous indorsement may indicate
a break in the chain of transfer by which someone other than the holder
is attempting to indorse the note. It is undisputed that IndyMac was the
holder, as the loan servicer’s testimony indicated. With this note, no break
in the chain of transfer occurred: Solutions Funding indorsed to IndyMac,
and IndyMac indorsed to blank. Because there was a special indorsement
from Solutions Funding to IndyMac, IndyMac was the holder. As a result,
IndyMac’s indorsement was not anomalous. See § 673.2051(1); see also §
673.2051(4).

                                  Standing

  The borrower argues that Deutsche Bank failed to prove standing.
Deutsche Bank responds that it established its standing by showing


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holder status, that is, by filing a copy of the note with blank indorsements
and by producing the identical original of the note. We agree.

    “A plaintiff has standing to foreclose if it is entitled to enforce the
promissory note under Florida’s enactment of the Uniform Commercial
Code.” U.S. Bank Nat’l Ass’n v. Clarke, 192 So. 3d 620, 622 (Fla. 4th DCA
2016). Under the UCC, a “person entitled to enforce” a negotiable
instrument means the holder of the instrument, a nonholder in possession
of the instrument who has the rights of a holder, or a person entitled to
enforce a lost note. § 673.3011(1)–(3), Fla. Stat. (2019). A holder has
“possession of a negotiable instrument that is payable either to bearer or
to an identified person that is the person in possession.” § 671.201(21)(a).
“A party may establish standing by showing that it was entitled to enforce
the note at the time it filed suit.” U.S. Bank Nat’l Ass’n. v. Becker, 211 So.
3d 142, 144 (Fla. 4th DCA 2017). A plaintiff who is not the original lender
may establish its standing to foreclose with proof that it was in possession
of the original note with a blank or special indorsement when it filed the
complaint. See Kenney v. HSBC Bank USA, Nat’l Ass’n, 175 So. 3d 377,
379 (Fla. 4th DCA 2015).

    “A transfer vests in the transferee only the rights enjoyed by the
transferor, which may include the right to enforcement, through the
shelter rule.” PennyMac Corp. v. Frost, 214 So. 3d 686, 689 (Fla. 4th DCA
2017). “To prove standing as a nonholder in possession with the rights of
a holder, the plaintiff must prove the chain of transfers starting with the
first holder of the note.” Murray v. HSBC Bank USA, 157 So. 3d 355, 358
(Fla. 4th DCA 2015). “Where the plaintiff cannot prove that a transferor
had any right to enforce the note, it cannot derive any right from the
transferor and is not a nonholder in possession of the instrument with the
rights of a holder to enforce.” Cox v. U.S. Bank Tr. N.A., 291 So. 3d 1026,
1031–32 (Fla. 4th DCA 2020).

   Deutsche Bank had standing to bring the foreclosure action. See §
673.3011(1)–(3). Although the Note did not identify Deutsche Bank as the
bearer, Deutsche Bank was a holder in possession of a note payable to
bearer. See § 671.201(21)(a); Kenney, 175 So. 3d at 379.

   Deutsche Bank relies on the presumption in Ortiz. In Ortiz, this Court
found that where a bank had actual possession of a note at the time a
complaint is filed, attaches a copy of the note, and later files with the court
the original note in the same condition as the copy, the bank is presumed
to have sufficiently established actual possession of the note and standing
to bring a foreclosure action. 188 So. 3d at 925. The borrower argued




                                      5
that Ortiz does not apply due to the alleged anomalous indorsement. For
the reasons above, the borrower’s effort to avoid Ortiz is unavailing.

   Deutsche Bank had the right to enforce the note through the chain of
transfer. See Pennymac, 214 So. 3d at 689. The two indorsements—from
Solutions Funding to IndyMac and from IndyMac to blank—are properly
connected, proving that Deutsche Bank is entitled to enforce as a holder.
See Murray, 157 So. 3d at 358; Cox, 291 So. 3d at 1031–32. With the Ortiz
presumption and the chain of transfers intact, Deutsche Bank properly
demonstrated that it had standing to foreclose on the note.

                         The Motion for Rehearing

    “A denial of a motion for rehearing is reviewed under the abuse of
discretion standard.” J.J.K. Intern., Inc. v. Shivbaran, 985 So. 2d 66, 68
(Fla. 4th DCA 2008).

    “If reasonable [persons] could differ as to the propriety of the action
taken by the trial court, then it cannot be said that the trial court abused
its discretion.” Canakaris v. Canakaris, 382 So. 2d 1197, 1203 (Fla. 4th
DCA 1980).

   Here, the trial court improperly denied Deutsche Bank’s motion for
rehearing. The trial court at the conclusion of the bench trial stated that
the defect in Deutsche Bank’s case was curable with proper indorsement
from the successor in interest and with support from competent evidence.
This information was not needed because the note had a blank
indorsement. Deutsche Bank’s motion for rehearing properly argued
against an anomalous indorsement and showed it had provided adequate
evidence otherwise and under the Ortiz presumption. 1

                                  Conclusion

    The circuit court’s final judgment is reversed, and the case is remanded
for further proceedings.

   Reversed and remanded.


1 The trial court was obviously influenced by the copy of the note from the earlier

case which lacked an indorsement in blank. To reach its conclusion, the trial
court would have been required to stack many inferences or engage in rank
speculation that the note could not have been timely and properly indorsed in
blank by a duly authorized IndyMac representative.


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GROSS and KUNTZ, JJ., concur.

                            *     *    *

  Not final until disposition of timely filed motion for rehearing.




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