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Empire Beauty Salon v. Commercial Loan Solutions IV, LLC

Citations: 159 So. 3d 136; 2014 Fla. App. LEXIS 18697; 2014 WL 5877947Docket: No. 5D13-2238

Court: District Court of Appeal of Florida; November 13, 2014; Florida; State Appellate Court

Narrative Opinion Summary

In this case, Empire Beauty Salon, Inc., along with Robert E. Hernandez and Salon Dominicano Associates Corporation, appealed a summary judgment that awarded damages to Fidelity Bank of Florida, N.A., due to Empire's default on a promissory note. The appeal contested several issues, primarily the improper service of process on Salon Dominicano. The court initially granted summary judgment in favor of Fidelity, dismissing a motion to quash the service. Salon Dominicano argued that the service was improperly executed through Hernandez, who was not an authorized representative of the corporation. The appellate court found merit in this contention, ruling that the service did not comply with Florida Statutes section 48.081, which dictates proper service procedures on corporations. As a result, the foreclosure judgment against Salon Dominicano was reversed, and the matter was remanded for further proceedings. Meanwhile, Hernandez's appeal was abated due to his bankruptcy filing, leaving no judgment against him. The case underscores the importance of adhering to statutory requirements for service of process on corporations to establish court jurisdiction properly.

Legal Issues Addressed

Burden of Proof for Valid Service

Application: Fidelity Bank failed to prove valid service on Salon Dominicano, as the return of service did not fulfill statutory requirements, and no evidentiary hearing was conducted to validate the service.

Reasoning: Fidelity bore the burden to prove valid service, which it failed to do.

Defective Return of Service

Application: A defective return of service, which lacks necessary information or fails to demonstrate attempts to serve the registered agent, cannot establish valid service, leading to the reversal of the foreclosure judgment.

Reasoning: The return of service was defective as it failed to confirm an attempt to serve the registered agent during the required hours and lacked essential information as mandated by statute.

Service of Process on Corporations

Application: The appellate court found that service of process on Salon Dominicano was invalid because it was not served in accordance with Florida Statutes section 48.081, which requires service on a corporation's registered agent or a qualifying employee.

Reasoning: Salon Dominicano contended that the foreclosure judgment was erroneous due to improper service, as it was served through Hernandez, who was neither its employee nor officer.

Substitute Service on Corporations

Application: Substitute service on a corporation must be accompanied by a factual basis demonstrating its validity, which was lacking in this case, necessitating remand for further proceedings.

Reasoning: Although substitute service is allowable, the process server must provide a factual basis for its effectiveness.

Waiver of Jurisdictional Challenge

Application: The appellate court rejected the argument that Salon Dominicano waived its jurisdictional challenge by participating in mediation, as it did not seek affirmative relief.

Reasoning: The appellee contended that the corporation waived its jurisdictional challenge by seeking mediation, but this argument was rejected as no affirmative relief was sought.