Central Park A Metrowest Condominium Assoc., Inc. v. AmTrust REO I, LLC

Citations: 169 So. 3d 1223; 2015 Fla. App. LEXIS 10842; 2015 WL 4366573Docket: No. 5D14-1511

Court: District Court of Appeal of Florida; July 17, 2015; Florida; State Appellate Court

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In this post-judgment foreclosure case, Central Park A Metrowest Condominium Association (Metrowest) appeals a trial court order granting 1224AmTrust REO I, LLC (REO) the safe-harbor protection under section 718.116 of the Florida Statutes regarding past-due condominium fees. The trial court correctly interpreted the law but lacked continuing jurisdiction to rule on the matter, leading to the order being quashed. REO initiated foreclosure proceedings against several parties, including Metrowest, asserting that AmTrust-NP SFR Venture, LLC owned the note and had authorized REO to foreclose. Metrowest counterclaimed for foreclosure based on its lien for unpaid condominium assessments. After a stipulated foreclosure judgment and property sale to REO, Metrowest demanded payment for past-due assessments. REO invoked the safe-harbor provision and motioned for a determination of owed amounts, requesting an accounting from Metrowest. Metrowest contended that REO, as the servicer and not the property owner, could not invoke the safe-harbor provision and argued that the trial court lacked jurisdiction to rule on the matter post-judgment. The trial court ultimately ruled in favor of REO; however, Metrowest challenges this on jurisdictional grounds.

A trial court generally loses jurisdiction after a final judgment is rendered and the time for altering or vacating that judgment has expired. Jurisdiction may be retained if specifically reserved in the final judgment or provided by statute or procedural rules. In the case of Central Mortgage Company v. Callahan, the Third District Court affirmed that the trial court lacked authority to issue a post-judgment order regarding assessments owed to condominium associations after a final judgment of foreclosure. The judgment had stated that Central Mortgage's lien was superior to any claims, except for those assessments deemed superior under section 718.116. Although the trial court reserved jurisdiction for certain orders, it did not specifically reserve jurisdiction for determining the amounts owed to the associations. Central Mortgage's appeal was denied, as the court emphasized there was no specific reservation to address the post-judgment motion and reiterated that inherent jurisdiction to enforce previously entered orders does not apply in foreclosure cases absent specific reservation. Central's reference to Huml v. Collins was deemed inappropriate due to its differing context involving dissolution of marriage, where courts retain broader enforcement authority. The court also dismissed the argument that the post-judgment motion was simply enforcing the foreclosure judgment, reinforcing that jurisdiction had been lost.

Entitlement to assessments was not addressed in the foreclosure case, as the final judgment did not specify any amount owed to the condominium associations. The judgment established the priority of liens, affirming that Central's lien is superior, except for assessments under section 718.116. Central's post-judgment motion was unenforceable because there was no prior adjudication on the assessments; courts cannot impose new duties that have not been litigated. The court rejected Central Mortgage's claim of retained jurisdiction for future orders regarding unpaid assessments, noting that earlier case law requires specific reservation of jurisdiction for such issues to be enforceable. In a related case, Montreux, a motion for determining unpaid assessments was reversed on appeal because the original judgment did not address this issue, and the motion sought new obligations rather than enforcement of an existing judgment. Central’s motion, filed after the deadline for amending the judgment, similarly lacked jurisdiction. Consequently, the trial court's order was quashed.

Section 718.116 of Florida's Condominium Act establishes the following key points regarding assessments and liability for unit owners and mortgagees: 

1. Unit owners, irrespective of how they acquired their title (including through foreclosure), are responsible for all assessments due while they own the unit.
2. For first mortgagees or their successors/assignees who acquire a unit through foreclosure or deed in lieu of foreclosure, their liability for unpaid assessments prior to their acquisition is limited to the lesser of:
   - Unpaid common expenses and periodic assessments due within the 12 months preceding their title acquisition, or
   - One percent of the original mortgage debt.
3. This limitation applies only if the first mortgagee included the condominium association as a defendant in the foreclosure action.
4. Joinder of the association is not required if the association was dissolved or did not have a known or discoverable office or agent for service of process on the date the foreclosure complaint was filed.
5. The term "successor or assignee" refers solely to subsequent holders of the first mortgage.