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March 1, 2013
Supreme Court rules for the bank in foreclosure document case

Trial judges cannot block the voluntary dismissal of mortgage foreclosure cases by plaintiffs or award damages in those cases to defendants unless the plaintiffs obtained some benefit before the dismissal, according to the Florida Supreme Court.

The court on February 7 decided an appeal in which the defendant in a foreclosure sought to reopen a voluntarily dismissed case and then have it dismissed with prejudice because the bank allegedly filed fraudulent documents to support its claim.

The trial judge denied that request and the Fourth District Court of Appeal, in an en banc decision, agreed. It certified the question to the Supreme Court on whether the trial court under Civil Procedure Rule 1.540(b) could reverse a voluntary dismissal if the plaintiff had received no affirmative relief.

Writing for the court, Justice Barbara Pariente said in the opinion “that when a defendant alleges fraud on the court as a basis for seeking to set aside a plaintiff’s voluntary dismissal, the trial court has jurisdiction to reinstate the dismissed action only when the fraud, if proven, resulted in the plaintiff securing affirmative relief to the detriment of the defendant and, upon obtaining that relief, voluntarily dismissing the case to prevent the trial court from undoing the improperly obtained relief.”

The court agreed with the Fourth DCA that Florida’s voluntary dismissal rule 1.420(a) has only narrow exceptions which did not apply in this case. Pariente wrote that Florida in its rules has traditionally had a liberal interpretation of plaintiffs’ right to voluntarily dismiss a suit once without prejudice, even if the reason is “tactical” and used to cure defects with the initial filing.

Pariente noted, though, that while courts cannot prevent the dismissal in cases where the plaintiff has not gained anything, “we emphasize that this does not mean a trial court is powerless to sanction fraudulent conduct. A notice of voluntary dismissal does not divest a trial court of jurisdiction to award sanctions under section 57.105, Florida Statutes (2012), even after a voluntary dismissal is taken.”

The court also asked the Civil Procedure Rules Committee to review the voluntary dismissal rule and advise the court “whether (an) 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 attorneys’ 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.”

Justices Fred Lewis, Peggy Quince, Jorge Labarga, and James Perry concurred with Pariente’s opinion. Chief Justice Ricky Polston and Justice Charles Canady concurred in the result only.

The court acted in Roman Pino v. The Bank of New York, case no. SC11-697.

[Revised: 11-23-2017]