Fl S.Ct: Roman Pino vs. Bank of New York


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Editor’s Analysis: Lawyers and Homeowners like to curse out the judicial system every time they get a decision they don’t like. The Pino case is one of them. “HOMEOWNERS LOSE” is the headline across the board in all media. Homeowners did not lose. Civil procedure won, and the homeowners were, once again, on the wrong side of it, although they were inadvertently encouraged by the Florida Supreme Court who took jurisdiction even after the case was dismissed and settled.

My guess is that the justices who decided to take the case thought there was some meat in there that would prevent false claims in court. This court, composed of progressive judges, was clearly looking for a way to chastise the banks for filing forged, false, fabricated and misleading documents. After reviewing it, they realized they couldn’t do that without throwing the whole judicial system out of whack — something that didn’t bother the banks but does bother the Supreme Court of any state.

But in every opinion that seems negative to homeowners there are oft-ignored instructions on how to do it right. Here we have Tom Ice, attorney for the homeowner and a competent one at that, against David Stern’s operation that was so dirty his own investors sued him for selling them a bunch of crap. Stern’s firm was known to have a full fledged document fabrication and forgery system which was used with impunity because once they got caught they dismissed the claim.

The issue taken up by the Florida Supreme Court was whether the Court could retain jurisdiction of a case that was dismissed and settled for the sole purpose of punishing a party who lied or submitted false documents into evidence. Much as the court probably would have liked to impose kangaroo justice on the banks and Stern, it reluctantly concluded that it just didn’t have the power (jurisdiction) to do that. To say otherwise would make every voluntary dismissal non-final. Thus any settlement would never be final.

Ice is wrong when he says that the Supreme Court doesn’t care about fraud in the judicial system. They cared enough to take a shot at stopping it with an ill-advised grab at jurisdiction to end this madness. We can’t change the law, the rules of procedure or the laws of evidence to suit the result we think should be the outcome. We are required, in a nation of laws, to arrive at the destination of justice using existing law and procedure. There is little doubt that the Florida Supreme court is very concerned about fraud in the judicial system and that it will do something about it as soon as the the existing laws and rules allow it.

There is a hidden good message in this decision. If the party who committed the fraud got nothing as a result of it, then the dismissal cannot be reversed. THAT is precisely the center of gravity of the homeowner defense: the banks did get millions of homes submitting fraudulent  documents and therefore are subject to various causes of action for having done so. In addition, the fact that the original transaction, for the most part, was never supported by consideration, making both the note invalid and nullifying the illusion of a lien imposed by the mortgage, means that the homeowner who attacks directly the basic premises of the foreclosure action using established law and procedure will be greeted by a friendly audience a the Florida Supreme Court. The headline should have been “Florida Supreme Court Opens door to damage claims for fraudulent documents.”

In short, the borrowers didn’t lose and the Court, far from being unsympathetic to the light of borrowers made that abundantly clear:

Because Pino sought no other available sanctions, and the case has since been resolved between the parties, we need not reach the question of whether the trial court should be able to award monetary sanctions under the circumstances of this case. We therefore approve the result reached by the Fourth District affirming the trial court’s denial of Pino’s motion.

“While affirming the decision of the Fourth District, we also understand the concerns of those who discuss the multiple abuses that can occur from fraudulent pleadings being filed with the trial courts in this state. While rule 1.420(a)(1) has well served the litigants and courts of this state, we request the Civil Procedure Rules Committee review this concern and make a recommendation to this Court regarding whether (a) explicit sanction authority should be provided to a trial court pursuant to rule 1.110(b), even after a case is voluntarily dismissed, (b) rule 1.420(a)(1) should be amended to expressly allow the trial court to retain jurisdiction to rule on any pending sanction motions that seek monetary sanctions for abuses committed by either party during the litigation process, or to allow the trial court explicit authority to include attorney’s fees in any award to a party when the dismissed action is reinstated, or (c) to adopt a rule similar to Federal Rule 11 to provide explicit authority for the trial court to impose sanctions.”

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