Today's Trends in Credit Regulation

Life Goes On in Florida After Robo-Signing
By Meghan S. Musselman

As state attorneys general continue to investigate whether mortgage lenders and servicers properly completed supporting documentation in foreclosure actions, and have proposed settlement terms to some, the question remains what will happen to foreclosures affected by these “robo-signing” allegations. In Florida, which had a staggering backlog of foreclosures even before the robo-signing allegations surfaced, the state intermediate appellate court recently allowed a bank to re-file a foreclosure that was originally supported by an insufficient chain of title and a questionable assignment.

In Pino v. Bank of New York Mellon,[1] the Bank of New York Mellon filed a foreclosure action against Roman Pino. The mortgage attached to the complaint identified Silver State Financial Systems as the lender and Mortgage Electronic Registration Systems as mortgagee. The complaint alleged (1) that BNY Mellon was the assignee of the note and mortgage but included no proof of assignment, and (2) that the original promissory note was lost. Pino sought to have the foreclosure action dismissed on grounds that, where the original note is missing, proof of a valid assignment is required. BNY Mellon amended the complaint and attached a new, unrecorded assignment that was dated shortly before the foreclosure complaint was filed and was executed by an employee of BNY Mellon’s attorney. Pino sought sanctions against BNY Mellon on grounds that the assignment was fraudulent. BNY Mellon eventually filed a notice of voluntary dismissal of the action.

Five months later, BNY Mellon re-filed its action to foreclose on Pino’s mortgage. The new complaint no longer claimed that the note was lost, and included a new assignment of mortgage that was dated after the voluntary dismissal. Pino moved to strike BNY Mellon’s voluntary dismissal under Florida Rule of Civil Procedure asserting that BNY Mellon effected a fraud on the court, and sought dismissal of the new action as a sanction. The trial court denied Pino’s motion and ruled that it lacked jurisdiction to consider sanctions because the previous action had been voluntarily dismissed. Pino appealed. The Florida Court of Appeals affirmed the trial court.

The appellate court found that the Florida Rules of Civil Procedure 1.420 allows a plaintiff to dismiss an action at any time before a motion for summary judgment is heard or before the matter is sent to the jury or to the court in a non-jury case. The appellate court found that BNY Mellon’s voluntary dismissal did not fall under any of the narrow exceptions to this rule, that BNY Mellon did not obtain any affirmative relief and that the voluntary dismissal did not adversely affect Pino. Thus, the appellate court ruled in favor of BNY Mellon and allowed the foreclosure to proceed.

This case may represent a light at the end of the robo-signing tunnel if other state courts follow Florida’s lead and allow lenders and servicers to correct errors in documentation and allow foreclosures to proceed.

One final note: Stay tuned in Florida. The appellate court deemed the issue in Pino one of great public importance and certified it to the Florida Supreme Court.

Meghan S. Musselman is a partner in the Maryland office of Hudson Cook, LLP. Meghan can be reached at (410) 865-5403 or by email at

[1] Pino v. Bank of New York Mellon, 2011 Fla. App. LEXIS 1056 (Fla. App. February 2, 2011)

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