GREGORY A. PRESNELL, United States District Judge.
This matter comes before the Court on Appellant's Initial Brief (Doc. 12) appealing the United States Bankruptcy Court for the Middle District of Florida's order (Doc. 10-13) overruling his objection to a claim of U.S. Bank, N.A. ("U.S. Bank") and denying without prejudice his Motion to Determine Secured Status (Doc. 10-1). In resolving this appeal, the Court has also considered the Appellee's Brief (Doc. 15) filed by U.S. Bank and Ocwen Loan Servicing, LLC ("Ocwen").
Anthony owns a home in Cocoa Beach, Florida. U.S. Bank holds a note secured by a mortgage on Anthony's home. Ocwen services the mortgage on behalf of U.S. Bank. As set forth in the Bankruptcy Court's order, U.S. Bank initiated a foreclosure action on its mortgage in state court in May 2009.
On August 18, 2014, Anthony filed a voluntary petition pursuant to Chapter 13 of the Bankruptcy Code. On February 4, 2015, Anthony filed a proof of claim on behalf of U.S. Bank and Ocwen (henceforth, the "Secured Creditors"). Anthony asserted that the claim was based on a recorded mortgage and that the value was $0.00. Three weeks later, Anthony filed an objection to the Secured Creditors' claim (henceforth, the "Objection"), arguing inter alia that the mortgage was unenforceable due to the running of the statute of limitations. (Doc. 12-2 at 22). On April 14, 2015, Anthony filed a motion to determine secured status (henceforth, the "Motion"). Anthony argues that he sought the status determination pursuant to 11 U.S.C. § 506(d). (Doc. 12 at 5). With some exceptions not applicable to the instant case, 11 U.S.C. § 506(d) provides that "[t]o the extent that a lien secures a claim against the debtor that is not an allowed secured claim, such lien is void."
After an evidentiary hearing regarding the Objection and the Motion, the Bankruptcy Court ruled in favor of the Secured Creditors, for two reasons: First, because Anthony was required to bring an adversary proceeding rather than simply treating the Objection and the Motion as contested matters, and second, on the merits Anthony's argument had been rejected by most Florida courts. (Doc. 10-13). By way of the instant appeal, Anthony challenges both of these conclusions.
Generally speaking in reviewing a decision of the Bankruptcy Court, the District Court must accept the Bankruptcy Court's factual findings unless they are clearly erroneous, but any legal conclusions are reviewed de novo. See, e.g., In re Englander, 95 F.3d 1028, 1030 (11th Cir.1996). The parties agree that the Bankruptcy Court's determinations as to the necessity of an adversary proceeding and the running of the statute of limitations are legal conclusions, subject to de novo review on appeal.
When controversies arise in bankruptcy cases, they can usually be categorized as an adversary proceeding or a contested matter. Contested matters are resolved
1 Howard J. Steinberg,
Most objections to claims are resolved as contested matters; but when such objections challenge "the validity, priority, or extent of a lien," the objecting party must file an adversary proceeding. Fed.R.Bankr.P. 3007(b); 7001(2). Before the Bankruptcy Court, Anthony argued that he was not obligated by Fed. R.Bankr.P. 7001(2) to bring an adversary proceeding because he was seeking to determine the validity of a claim — i.e., the note — rather than the validity of a lien — i.e., the mortgage.
The Bankruptcy Court disagreed, finding that regardless of however else the relief sought might be characterized, in substance Anthony was seeking a determination as to the validity and extent of the mortgage. Upon review, this Court finds that the Bankruptcy Court did not err in overruling the Objection and dismissing the Motion due to the failure to file an adversary proceeding. Pursuant to Section 506(d), a determination that the note was unenforceable would have rendered the mortgage invalid. The Objection and Motion were attacks on the mortgage, not just the note.
Florida law provides a five-year statute of limitations for foreclosure actions. Fla. Stat. § 95.112(c).
Before the Bankruptcy Court, Anthony relied on the opinion in Deutsche Bank Tr. Co. v. Beauvais, 2014 WL 7156961 (Fla. 3d DCA Dec. 17, 2014), which held, in essence, that when a lender accelerates the underlying debt and sues to foreclose the mortgage, and then has its foreclosure case dismissed without prejudice, the statute of limitations precludes any subsequent actions to collect the accelerated debt. (Doc. 10-13 at 5). The Bankruptcy Court rejected the Beauvais decision in favor of a line of cases originating with Singleton v. Greymar Associates, 882 So.2d 1004 (Fla.2004). Singleton also involved an acceleration and foreclosure; however, the foreclosure action in Singleton had been dismissed with prejudice. Id. at 1005. The lender subsequently filed another foreclosure action, based on a different default. Id. Despite the fact that judgment had been entered against the lender in the first action after an acceleration, the Florida Supreme Court held that res judicata did not bar the second suit.
Singleton, 882 So.2d at 1007 (emphasis added). Under this line of cases, an unsuccessful acceleration does not bar later actions based on subsequent defaults — and therefore the note is enforceable.
The decision in Beauvais was recently withdrawn on rehearing en banc; it has been superseded by an opinion in which the Third District Court of Appeals determined that Singleton controlled its decision and the lender could file a second foreclosure action despite the dismissal of the first one:
Deutsche Bank Trust Co. Americas v. Beauvais, 188 So.3d 938, 941 (Fla. 3d DCA 2016). In his brief, Anthony has not pointed to any other case reaching the result he now advocates. As such, the Court finds that the Bankruptcy Judge did not err in concluding that the Note and Mortgage
The order of the Bankruptcy Court overruling the Objection without prejudice and denying the Motion without prejudice is