Legislative Update

On May 5, 2023, the Florida Legislature concluded another legislative session. During this most recent session, it passed several laws that have an impact on financial institutions and credit unions. We want to take this time to make you aware of these changes and how they may impact your credit union.

Payoff Letters

One bill that was passed during the latest session makes changes to Section 701.041, Florida Statutes, and payoff letters. Pursuant to these changes, a payoff letter must be provided in writing within ten (10) days of receipt of a written request. This is a change from the previous requirement of fourteen (14) days. The changes also address requests from third parties. If a request is made by someone other than the borrower, such as a title company, the request must include a copy of the instrument showing their entitlement to the payoff letter. Upon receipt of the request, the credit union must make the borrower aware of the third party’s request for a payoff letter.  

The changes also provide clarification on how requests must be both received and sent. Regarding requests for a payoff, they must be sent to the credit union by first-class mail, postage prepaid, common carrier service, or by e-mail, facsimile, or other electronic means at an address made available by the credit union. The request is considered received five (5) business days after it is deposited in the mail, provided it is sent by first-class mail; the day it is delivered by common carrier; or the day it is sent, if sent by e-mail, facsimile, or other electronic means. If the delivery date falls on a non-business day, it will revert to the next business day. These dates are important, as they will determine the ten-day window for responding to the request. The payoff letter must be sent to the requesting party in the manner requested in the written request for a payoff.

The legislative change also addresses what information must be provided in the letter. Under the changes, the payoff letter must provide an itemization of the amounts owed on the loan, as well as the daily interest, per diem, and a good through date for the payoff. Under the previous law, the credit union was only required to provide the total unpaid balance. The change also addresses the accuracy of the letters. Unless the mortgage is subject to a current foreclosure or bankruptcy, the credit union cannot reserve the right to change, condition, or disclaim the information provided in the payoff letter. Any attempt to do so will be void and unenforceable. Therefore, it is important that accurate information be provided in the payoff letter. The statute does provide an exception if the payoff letter contains a mistake. If there is a mistake, a corrected payoff letter must be received by the requesting party by 3:00 P.M. in their time zone at least one (1) business day before a payment is issued in reliance of the original payoff letter. If these conditions are not met, the credit union must honor the original payoff letter. 

These changes take effect October 1, 2023. 

Satisfaction of Mortgage and Judgement Lines

Not only does Section 701.041, Florida Statutes, address payoff letters, it also addresses satisfaction of mortgage and judgment liens. Whenever payment is made in full on a mortgage or a judgment lien, the credit union, its servicer, or lawyer of a judgment lien, must record a satisfaction within sixty (60) days. It is important that you record the satisfaction within sixty days, because failure to do so can entitle the borrower or judgment debtor to an award of reasonable attorney’s fees.

These changes take effect October 1, 2023.

Collateral Protection Insurance (CPI)

The Legislature also enacted regulations for Collateral Protection Insurance. Under the new statute, Section 627.9901, Florida Statutes, regulations are provided for insurers as it relates to CPI. Under this new law, a CPI policy cannot be applied any earlier than the date of lapse of coverage and must terminate when the borrower obtains acceptable insurance coverage, the mortgage is no longer a lien on the property, or a date specified in the policy or by the lender. If CPI is added, an individual policy or a certificate of insurance must be mailed by first-class mail to the borrower at their last known address. Any policy coverage must be based on the replacement cost value of the property. The Statute provides a basis for determining what the value may be and is set forth in Section 627.9905, Florida Statutes. In the event of any loss, any insurance proceeds that exceed the unpaid principal balance must be paid to the borrower.

This law took effect July 1, 2023.

Fraud

The Florida Legislature also passed a series of laws to combat real property fraud in Florida. 

Witnesses to a Recorded Instrument

Another change is to witnesses to recorded instruments. Under Section 695.26(1)(c), Florida Statutes, any witness to a recorded instrument must include their post office address beneath their signature. This is in addition to requiring that the witness’s name appear legibly under their signature. 

This change takes effect January 1, 2024.  

Quitclaim Deeds

The Legislature also addressed what it felt were inconsistencies in quitclaim deeds. A quitclaim deed is a legal instrument in Florida that transfers title to real property. Unlike a warranty deed or special warranty deed, a quitclaim deed does not include any warranties by the grantor as to the marketability of title or even its ownership interest. These are commonly used for conveyances amongst family or divorcing spouses, as well as deeds in lieu of foreclosure. The Legislature, in its desire to create uniformity, created a form quitclaim deed that is found in Section 689.025, Florida Statues. The notable change is that it requires the parcel identification number or a blank box for this formation to be included. 

These changes took effect July 1, 2023. 

Lee County Pilot Program

The Legislature created the Title Fraud Prevention Through Identify Verification Pilot Program in Lee County, Florida. Under the Pilot Program, the Lee County Clerk of Court will require the production of a government issued photo identification document from the person that is presenting a document for recording that acts as a conveyance of real property. If the recording is done in person, the Clerk will record their name and address, along with the book and page of the document being recorded. This information will be kept confidential. If the recording request is made by electronic means, the Clerk will retain a copy of the government issued photo identification document. If proper identification is not provided, the Clerk can refuse to record any document that conveys title to real property. 

This Pilot Program will continue until July 1, 2025. By no later than December 31, 2025, the Clerk must present a report regarding the Program to the Governor, Speaker, and President of the Senate. 

Statewide Notification Service

Under a new law, the Clerk of Court in every county in Florida must create and operate a free recording notification service. Under this service, the owner of real property can opt-in to receive electronic notification anytime a document is recorded that encumbers or conveys real property that they own. The notification will be sent within twenty-four (24) hours of the document being recorded. 

Mandatory compliance by the Clerks of Court is required by July 1, 2024. 

If you have any questions about these recently enacted laws and how they may impact your credit union, please do not hesitate to contact one of the lawyers at SVL for legal advice.     

What is an Interpleader and How is it Used to Protect the Credit Union in Account Disputes?

Interpleader – this type of action has come up a lot lately, and I wanted to address what it is, how it is used, and what a Credit Union may expect from such an action.  

In Florida, an Interpleader “is an equitable proceeding,” governed by Florida Rule of Civil Procedure 1.240, which enables a third party, who faces liability as a result of conflicting claims to an asset, but that has no interest in that asset, to commence an action against the competing claimants and to compel them to litigate the matter among themselves in order to determine who is entitled to the assets. The rule states as follows:

Persons having claims against the plaintiff may be joined as defendants and required to interplead when their claims are such that the plaintiff is or may be exposed to double or multiple liability. It is not ground for objection to the joinder that the claim of the several claimants or the titles on which their claims depend do not have a common origin or are not identical but are adverse to and independent of one another, or that the plaintiff avers that the plaintiff is not liable in whole or in part to any or all of the claimants. A defendant exposed to similar liability may obtain such interpleader by way of crossclaim or counterclaim. The provisions of this rule supplement and do not in any way limit the joinder of parties otherwise permitted. Fla. R. Civ. P. 1.240.

Traditionally, and in most instances, interpleader actions involve escrow agents in real estate transactions or entitlement to insurance proceeds. However, as to Credit Unions, the most common actions involve a dispute as to ownership of funds in an account following the death of the owner, a dispute following a divorce, or a final draw in a construction contract. As I am sure you are aware, it is not uncommon for a Credit Union holding money to be placed in a situation where multiple parties claim entitlement to the funds being held. While in many, if not most, of these situations, it is clear who is entitled to the funds, occasionally due to a timing issue or other intervening issues, it is not clear who is entitled to the funds. Given the competing claims to the funds, a Credit Union can wait for the parties to resolve their dispute or file an interpleader action, asking a Court to decide who should get the funds being held. In the absence of an interpleader action, a Credit Union must either give the asset or property to one of the parties claiming ownership or face a lawsuit for wrongfully giving the funds to the other claimant. An interpleader action, therefore, enables a Credit Union to turn the disputed funds over to the registry of the Court while the claimants litigate it. It is designed to eliminate multiple lawsuits over the same funds and to protect the interpleading party (here, the Credit Union) from actual or potential liability.

In Florida, to initiate an interpleader action, a Credit Union must file a complaint, alleging that it is the holder of the assets, has no claim to the assets in dispute, and does not know to which claimant the funds should be delivered, and may be exposed to double or multiple liability. The Court must then decide whether the interpleader is proper. The Court has discretion to allow the interpleader, but it may deny the relief if the Credit Union is guilty of some wrongdoing. If the Court grants the interpleader, the Credit Union is typically directed to deposit the funds in the registry of the Court, discharging the Credit Union from further liability while the claimants are given the right to litigate their claims. As to the court costs and attorney’s fees, these are typically assessed against the funds being held, if the Credit Union has either a contractual right or common law right as a “disinterested party.” The actual timeline for said actions is shorter than most actions, because it typically only involves one hearing on the matter. However, like all actions, the timing is highly dependent on the current status or backlog of matters in the Court in which it is filed.

If you have any questions about interpleader actions or how to initiate one, please do not hesitate to contact one of the lawyers at SVL for legal advice.  

Staff Spotlight on McKinley Hill

McKinley was born in Memphis, Tennessee, and moved at the age of 8 to a small town in Alabama, called Opp. Her family moved to Tallahassee, Florida, when her dad got a football coaching job at North Florida Christian where McKinley attended high school. McKinley is starting Florida State University in the fall as a sophomore due to her 36 dual enrollment credits! She is planning on majoring in social work and then attending law school to become a child advocacy lawyer. McKinley’s family are huge Florida State fans, and she says it was a dream to be accepted and attend FSU for college!

At the office, McKinley is our bankruptcy clerk. She assists the bankruptcy legal assistants with setting up their new files, preparing the Notices of Appearance for the specific cases, and e-filing them on PACER. She is also beginning to prepare reaffirmation agreements for Chapter 7 bankruptcies and proceeding to send those to either the debtor or the debtor’s attorney. We are grateful to have McKinley here with us part-time while she is attending school!

In McKinley’s spare time, away from the office, she likes to stay active. She loves to run, workout, kayak, hike, and find/walk trails around town. She also likes going to the beach with her family and exploring new restaurants and stores in Tallahassee. Thank you McKinley for all you do!

Staff Spotlight on Haley Grant

Haley was born and raised in Tallahassee, Florida. She joined the SVL team in June of this year and is one of our legal assistants in the post-judgment department. Haley assists our Credit Union clients in recovering money once a Final Judgment is entered. 

Away from the office, Haley enjoys spending time with her family, especially her sister-in-law and her niece, who is 16 months old. To Haley, Little Miss is the best entertainment. Haley enjoys watching her experience the world through her eyes. The three of them love watching movies and taking golf cart rides together. Haley has a golden doodle pup named Remi who she loves to spend time with, as well. 

We are happy to have Haley as a part of our team! Thank you for all you do for the firm.

Back to School & Making a Difference

We kicked off the new school year by sponsoring two local children and providing them with all their school supplies. It is always amazing to see our employees come together to make a difference with our gratitude projects. Not only did we donate crayons, notebook paper, erasers, pencils, earphones, backpacks, and other supply needs, but our staff’s monetary contribution also allowed our firm to donate gift cards for the children to shop for new clothes! What a huge way to help those in need. Great job SVL!

On July 26, 2023, the Consumer Financial Protection Bureau (CFPB) issued a new Supervisory Highlights Report (Summer 2023). This report provides insight into recent CFPB examinations, including issues or activities the Bureau seeks to highlight. As the Director stated, “Today’s report furthers our efforts to highlight conduct that violates federal law, including the prohibition on abusive practices in consumer financial services.”

The Summer 2023 Supervisory Highlights Report addresses the following issues: auto origination and servicing, consumer reporting, debt collection, deposits, Fair Lending, information technology, mortgage origination and servicing, payday and small-dollar lending, and remittances. I will highlight the issues that impact a Credit Union’s collection departments. The CFPB’s pronouncements regarding use of a cross-collateral clause in certain situations will be of particular interest.

The CFPB found the following instances of unfair or abusive acts or practices by auto loan services:

• Charging fraudulent interest on inflated loan balances;
• Canceling automatic payments without sufficient notice, leading to unavoidable late fees;
• Engaging in illegal collection practices after repossession.

The illegal collection practices identified by the CFPB involved enforcement of a cross-collateral clause. The CFPB was concerned with servicers who refused to allow the consumer to redeem the vehicle for the auto loan balance. In the identified situation, the servicers required that the borrower pay the full balance of the auto loan and the other cross-collateralized loan. The CFPB stated that using the cross-collateral clause in this manner is unfair and abusive.

This is the first time the CFPB has addressed the use of a cross-collateral clause. The CFPB did not indicate when and where the use of a cross-collateral clause would be legal. The CFPB did not suggest that a cross-collateral clause is always unfair and abusive. Thus, we conclude that there are situations where the use of a cross-collateral clause is legal. When and where that clause is legal remains to be seen and further guidance from the CFPB is needed.

Regarding consumer credit reporting, the CFPB found that creditors have failed in their duties under the Fair Credit Reporting Act by failing to periodically review and update their policies and procedures regarding credit reporting and credit disputes. The Bureau also found that creditors were failing to conduct a reasonable investigation of direct disputes, failing to notify consumers that a dispute had been determined to be frivolous or irrelevant, and failing to identify the additional information needed to investigate a dispute.

In addition, the CFPB found lenders whose dispute handling process had changed but the policies and procedures had not been changed. This is a reminder to schedule regular reviews of policies and procedures to be sure they reflect current practices and comply with applicable law. For instance, it is time for a re-draft if your policies and procedures do not reflect your current practices.

The additional areas of concern addressed by the CFPB in the Supervisory Highlights included:  concerns about fair lending, involving pricing discrimination and discriminatory lending restrictions; lenders who failed to implement adequate information technology security controls; mortgage origination and mortgage servicing compliance; and failure to comply with the Remittance Rule under Regulation E. A full copy of the Supervisory Highlights can be found here.

Sorenson Van Leuven will continue to monitor CFPB advice and provide additional guidance regarding the use of cross-collateral clauses. If you have further questions or would like us to review your current use of a cross-collateral clause, please do not hesitate to contact one of our lawyers.

-Jim

FinCEN and Beneficial Ownership Information Reporting Requirements

The Financial Crimes Enforcement Network (“FinCEN”) is an agency of the Treasury Department that operates to safeguard the financial system from illicit use and to combat domestic and international money laundering, terrorist financing, and other financial crimes. 

As a part of the Corporate Transparency Act, FinCEN has issued a Final Rule that will take effect on January 1, 2024, which will require certain entities to file reports that identify two categories of individuals: (1) the beneficial owners of the entity and (2) the individuals who have filed an application with specified governmental authorities to create the entity or register it to do business. 

The Final Rule identifies two types of “reporting companies,” domestic and foreign. A domestic reporting company is a corporation, limited liability company, or any entity created by the filing of a document with the secretary of state or any similar office under the law of a state or Indian tribe. 

The Final Rule defines a “beneficial owner,” as anyone who, directly or indirectly, owns or controls at least 25% of the ownership interests of a company registered to do business in the U.S. or someone exercising “substantial control” over such a company. 

The requirement will necessitate the reporting of beneficial ownership information, which includes name, birthdate, and address for each beneficial owner. In addition to these three pieces of information, a unique identifying number from an identification document acceptable to FinCEN will need to be provided, along with an image of that document, for each beneficial owner. 

The intention of this reporting requirement is to prevent criminal actors from using anonymous shell companies and other corporate structures to hide their illicit gains. These criminal actors could include oligarchs, terrorists, drug and/or human traffickers. In support of this effort to stop such illicit actors, Credit Unions and Banks will have to collect beneficial ownership information from the companies they do business with. 

The Final Rule provided a timeline for reporting entities: (1) a reporting entity that was created or registered before January 1, 2024, will have one year (January 1, 2025) to file their initial reports and (2) reporting entities created or registered after January 1, 2024, will have thirty days after creation or registration to file their initial reports. 

To accommodate the beneficial ownership information, FinCEN is developing a Beneficial Ownership Secure System (“BOSS”) to store and secure the data it receives. FinCEN’s current rules state that Credit Unions and other financial institutions may only have limited access to BOSS data. Additionally, and of more concern, Credit Unions and other financial institutions may be liable for civil or criminal penalties if they do not safeguard beneficial ownership information. Sorenson Van Leuven will continue to monitor for more information and guidance regarding potential penalties for failure to comply with the reporting requirements. 

FinCEN is set to provide more guidance in preparation for the January 1, 2024, effective date. Future guidelines will help Credit Unions comply with this new reporting requirement. Furthermore, FinCEN is set to prepare a “Small Entity Compliance Guide” that will help inform small entities required to file reports. 

Sorenson Van Leuven will continue to review the Final Rule and update its clients on any additional guidance provided by FinCEN in preparation of the effective date. If you have any questions or concerns regarding the beneficial ownership information reporting requirement, do not hesitate to reach out to SVL. 

Recent Changes to Service of Process in Florida

In 2022, the Florida Legislature passed S.B. 1062, which made significant changes to the procedures for service of process in the state of Florida. The changes impact service of process on business entities but do not change the procedure for service of process on an individual. S.B. 1062 took effect on January 2, 2023. 

Service of process is the process or procedure by which a party is given notice of a pending lawsuit. Without proper service of process, the lawsuit or legal action cannot proceed forward. If a party files a legal action and cannot complete service of process, the lawsuit will be dismissed.

The way the statute is structured is to promote service of process first on the business entity’s registered agent (if one exists). A registered agent is a person appointed by the business to accept service of process on behalf of the business entity. In Florida, a registered agent can be a person or business entity. Some business entities, such as corporations, are required to appoint a registered agent. Financial Institutions, including Credit Unions, are not required to appoint a registered agent but can appoint one under Section 655.0201, Florida Statutes.

If service cannot be accomplished on a registered agent, then service of process can be made on the business entity’s representatives (owners or officers). The party seeking to serve process only has to attempt service of process once on the registered agent. After one good faith attempt, the party can proceed to serve the appropriate business entity’s representatives, identified in the statute. For example, when serving process on a corporation, serving the board chair, president, any vice president, secretary, treasurer, or person listed on the corporation’s latest annual report will be sufficient. If attempting to serve a limited liability company, the party can serve the managers, if manager-managed or a member (owner).

As a last resort, service can be had on the Florida Secretary of State or through electronic means. To serve the Florida Secretary of State, service can be accomplished by electronic filing, personal service through process server or sheriff, or through certified mail. The statute also provides an alternative to service on the Florida Secretary of State, which is the ability to serve through other “reasonable means.” This requires that a party file a motion with the Court to establish their right to use the alternative means method. These alternative means can include email or other electronic means. If the court approves the motion, then the party can effectuate service via email or other approved electronic means.  

The changes should make litigation against business entities less expensive, time consuming, and eliminate some of the prior disputes over service of process on a business entity. We do recommend that each Credit Union have a registered agent for service of lawsuits and other legal notices. Should you have questions about this new law or the appointment of a registered agent, please do not hesitate to contact a lawyer at Sorenson Van Leuven Law Firm.   

Staff Spotlight on Jazmin Gallien

Jazmin is originally from Louisiana. She moved to Florida in 2021 after her dad and her twin brother, Jordan, persuaded her to come to the sunshine state! She joined the SVL Team in February of 2023 and she is a legal assistant in our post-judgment department. Jazmin is a mother of three wonderful children, ages 7, 8, and 10. Alijah, 7, her youngest son, loves karate and enjoys lego creating; Ariana, 8, enjoys dancing, being silly, and riding her bike; and Dina, 10, likes swimming, reading, singing, and dancing! 

When Jazmin is away from the office, she enjoys spending time with her boyfriend, going to the beach, and sitting at a local lake here in Tallahassee to watch the wildlife. She also spends much of her time at the park with her kids, nieces, and nephews who keep her busy! One fun fact about Jazmin is that she likes to cook creole/Cajun cuisine – gumbo, jambalaya, and crawfish etouffee. Her favorite thing is to bake. She makes an incredible mud pie and banana pudding. Jazmin would love to own her own café one day. 

Jazmin, thank you for all you do at Sorenson Van Leuven! We look forward to many more years with you.

Staff Spotlight on Magdalene Nwokeji

Magdalene joined the SVL Team in February of this year as our newest bankruptcy legal assistant. Originally from Sarasota, Florida, Magdalene came to Tallahassee for college and stayed here after graduating, seeking a job. After the pandemic, she was interested in the concept of consumer debt and how it related to the financial system. Sorenson Van Leuven caught her eye as she was browsing the internet. She appreciated the personalized and educational touch that the website had compared to other law firms. She applied for the open position we had available and now Magdalene is apart of the Bankruptcy Team, assisting our clients with Ch. 7 and Ch. 13 cases that have been filed by their Credit Union members. 

Away from the office, Magdalene enjoys spending time with friends, reading, and being “in the know” about world and political events. She also likes to dance and listen to music. She loves makeup and all things fashion too! Magdalene also loves cats and considers herself a “cat whisperer.” She doesn’t own any cats, but every cat that she meets loves her (even ones that she’s never met before). There is one cat in particular who visits her house, which she considers to be “unofficially officially” hers now. 

We are thankful to have Magdalene as a part of our Sorenson Van Leuven Team. She is a valuable asset to our firm and we appreciate all that she does!

Out of Office

On Saturday, May 13, SVL hosted a Family Fun Day at a local hangout – District 850. We enjoyed bowling, laser tag, and fun arcade games for the afternoon. It was a fun time away from the office spending time with our co-workers, their spouses, and their children. We are looking forward to the next staff get-together later this year!

2023 CUCP Summit

Our firm sponsored and attended the 2023 Credit Union Collection Professionals (CUCP) Summit in Orlando on May 17-19, 2023. The mission of the CUCP is to develop, educate, promote, and provide a professional support system to all people in the Credit Union movement. Attorney Steve Orsillo from our office spoke on the topic of Negotiation Strategies and was also a part of a panel on Legal Hot Topics. It was a great time networking with some of our current Credit Union clients and also building new relationships too. Thank you CUCP for including us!

Towing, Storing, and Mechanic’s Lien Shenanigans

In today’s ever-changing financial landscape, Credit Unions must do everything they can to keep a competitive edge. With inflation high and consumer credit card debts skyrocketing, we have seen an uptick in motor vehicle defaults. However, another area that we have seen an increase in issues that Credit Unions are dealing with is liens from towing, storage, or mechanic’s shops on their collateral. Unfortunately, all of these dealings haven’t been with reputable shops.

Under Section 713, Florida Statutes, towing and storage companies and mechanic shops are granted a lien on a vehicle for the services they perform. If they are not paid for their services, they have the ability to sell the vehicle free and clear of any lien if they follow the correct steps, as set forth in the statute. For some Credit Unions, when they receive the required Notice Of Claim of Lien and Proposed Sale they look at it as if they have two options: (1) either pay what is owed to the company or (2) chalk it up as a loss. However, there is a third option that we have had a lot of success with in preserving the rights of our clients as to the collateral and giving them an upper hand in dealing with these shops.

In many instances, we have seen that Credit Unions are having a hard time getting reliable information from the shops as to the nature of the charges and the condition of the vehicle. In some instances, they have not even been able to have a representative inspect the vehicle to determine the condition in order to make an informed decision as to paying off what is owed. In these situations, sometimes a phone call or a strongly worded demand letter from an attorney’s office can rectify the situation without needing to get too involved. However, this is not always the case. What we have found is that there are (shockingly) some shops that are less than honest about the vehicle and are good at playing games. In this situation, we will need to step it up a notch.

Under Section 713.78 (for towing and storage liens) and 713.585 (for mechanic’s liens), a lienholder on a vehicle that has been set for auction can stop the sale by posting either a cash or surety bond (a surety bond will only cost you roughly 10% of the total amount of the bond) with the Clerk of Court, equal to the total amount due for the charges set forth in the notice, and the daily fees up until the day of the sale. This sounds simple but, in our experience, it has been that many Clerks rarely deal with this type of proceeding and are unfamiliar on how to proceed. We have found a good way to navigate this and ensure that our client gets the outcome they want. First, we file a complaint in the county court of the location of the shop, contesting the amounts owed. This facilitates the process and makes it easier for the Clerk to process the bond with an open case with a case number.

Then, a few days after the case is filed, we go in person to the Clerk’s office and file the surety bond for the full amount owed. I have filed roughly twenty (20) bonds in these types of situations and every single time it has taken around an hour to complete the process. Every time the Clerk at the window had no idea what to do and had to involve their supervisor, who also had rarely, if ever, seen this, so they had to reference their procedures. This is why I prefer to go in person in order to help facilitate the matter if they have questions/concerns (which they almost certainly will). Once the bond is filed with the Clerk, they will issue a Notice, which states that the sale is cancelled, and the shop has to return the vehicle to the Credit Union. I will then drive to the shop and hand deliver to them a letter from our office and a copy of the Notice stating that they have to release the vehicle. In most instances, it is prudent for the Credit Union to have their repossession agent meet me at the shop to pick up the vehicle immediately, as the less time it stays at the shop after the cancellation of the sale, the better.

Once the bond is filed, and the car is released, the process is not over. The shop does have the ability, under the Florida law, to file an action to collec

t on the bond. This would entail a hearing to determine what they are owed under the law and that amount would be taken out of the bond. However, we have not seen this happen. If no action is filed within sixty (60) days, we will ask the Court to release the bond and close out the case.

Dealing with towing, storage, and mechanic’s liens can be a very easy and smooth process, but it can also become a nightmare that involves many headaches and much frustration. If the latter presents itself just know that there are options for the Credit Union. Each case is unique and we recommend you contact an attorney to discuss your rights and the best way to proceed. If you have any questions involving these types of liens, or any other matter, please reach out to us at (850)388-0500 or email.

An Interesting Interpretation on Florida’s Legal Chameleon – Homestead

Florida is known for many unique things, its beautiful beaches, Disney World, and NASA, but one often overlooked unique thing is its homestead laws. The Florida Constitution provides certain homestead protections for individuals that can, at times, be difficult to understand and are often subject to changing interpretations.

When it comes to Florida’s homestead laws, what is important to know is that a person’s homestead property is exempt from forced sale under process of any court and no judgment, decree, or execution shall be a lien thereon, except for the payment of taxes and assessments thereon, obligations contracted for the purchase, improvement, or repair thereof, or obligations contracted for house, field, or other labor performed on the realty. Article X, Section 4. It is also important to understand that if married, you cannot alienate the homestead by mortgage, sale, or gift without the joinder of your spouse. This becomes important to understand when dealing with a mortgage. If the subject property is a married couple’s homestead, both spouses must at least sign the mortgage. Otherwise, the lender may not have a valid and enforceable mortgage lien. An issue that may arise is what happens when you are dealing with a non-owner spouse, meaning one that is not listed on the deed. Or a situation where a married couple is permanently separated (not legally divorced) and are thought to have abandoned the homestead and waived any rights. These issues were recently discussed in Isaacs v. Fannie Mae, 47 Fla. L. Weekly D2632 (Fla. 3d DCA December 14, 2022).

In Isaacs, a husband and wife separated, resulting in the husband permanently abandoning the homestead, quitclaiming his interest in the property to the wife, and purchasing a separate primary residence (he even claimed a homestead property tax exemption). After years of separation, the wife acquired a mortgage that the husband did not join and sign. Sometime after acquiring this mortgage, the wife passed away. The lender sought to foreclose the mortgage and the husband objected, arguing that the mortgage was invalid, as it was her homestead, and he did not join in alienating the property by signing the mortgage. The trial court agreed with the lender that the husband abandoned the property by conveying his interest and acquiring his own primary residence. Following the entry of a foreclosure judgment for the lender, an appeal ensued, whereby the Third District Court of Appeal held that the mortgage was not valid, as the husband did not join. In reaching its decision, the Third DCA held that a non-owner spouse’s abandonment of the homestead does not constitute a waiver. Rather, under Article X, 4(c), a spouse, if married, must join in the mortgage. Here, the wife was married at the time of the mortgage and it was her homestead. Therefore, the husband had to join. The fact that the husband conveyed his interest in the property, and owned a separate primary residence where he was claiming a homestead residence was of no relevance to the Court, based on its interpretation of the Florida Constitution.

It is important to note that the interpretation of Florida’s homestead laws is always changing, hence it being a legal chameleon. If faced with a situation where the subject property is homestead, it may be wise to have both spouses at least sign the mortgage, or the non-joining spouse sign a waiver of their homestead rights, regardless of whether they are separated. It is also important to note that a tenancy by the entirety and homestead protections for spouses are severed once a divorce is finalized by the Court through a final order.

If you have any questions about Florida’s homestead protections and how they may impact your ability to enforce a mortgage or finalize a transaction, please do not hesitate to contact one of the lawyers at SVL for legal advice.

Staff Spotlight on Carrie Walrath

Carrie joined the SVL team in May 2022. She is a legal assistant in our post-judgment department. She has an associate degree in paralegal studies and has work experience as a chief clerk/traffic clerk in probate court, as a court clerk in the city court system, and has also been employed at a family law firm. Carrie’s background with the Georgia court system is what drew us to her! She is an outstanding asset to our firm.

Carrie is married to her husband Dennis. They have been married twenty years (almost twenty-one!). Carrie has two sons, who are turning twenty-eight and twenty next month. Dennis and Carrie both enjoy traveling and camping. Their favorite place they have visited is out west to explore Yellowstone. She also says nothing compares to the Grand Canyon. When camping, they go on hiking adventures to see all the views and amazing sights.

When Carrie is not at the office, she loves to read. Her favorite authors are Stephen King and John Grisham. She also likes to go on walks and spend time with her friends and family. One more fun fact about Carrie is that she has her commercial driver’s license (CDL) and can operate heavy equipment!

Thank you, Carrie, for all you do – SVL is lucky to have you!

Staff Spotlight on Tanisha Gibson

Prior to joining the SVL team in March 2022, Tanisha was a teacher for ten years. She received her education degree from Ashford University in 2018. Her son Jakarri was her inspiration to pursue this line of work. Tanisha spent her teaching career with VPK age children, preparing them for the transition to kindergarten. We are very grateful to have Tanisha as one of the legal assistants in our collections department at the firm. She has a determined work ethic and is a very valuable team member.

Tanisha’s son, Jakarri, is a fifth grader who loves football, playing the position of quarterback. From what we hear, he is a very talented player! He started playing at the age of four and has won two championship rings, six trophies, and has received the best quarterback award. Jakarri has Tanisha watch both NFL and college football with him during the active seasons – this time together is very special to Tanisha!

When Tanisha is not at the office, she enjoys shopping, spending time with Jakarri, and eating at vegan restaurants. A fun fact about Tanisha is that she has her business license and owns a clothing boutique, which she is planning to open soon. Thank you, Tanisha, for all that you do! You are extremely appreciated.

Giving Back

Each Christmas season, the SVL team adopts a family in hopes of making the season more special for them. We partnered with ECHO Outreach Ministries this year and we were able to help a mom and her three children have a Christmas to remember! Thank you to our team who made this a success.