IN THE SECOND DISTRICT COURT OF APPEAL LAKELAND, FLORIDA THOMAS J. JOHNSON and SUZANE JOHNSON, Defendants/Appellants, vs.

DEUTSCHE BANK, NATIONAL TRUST COMPANY, As trustee for Saxon Asset Securities Trust 2007-2, Plaintiffs/Appellees. / ON APPEAL FROM THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL DISTRICT IN AND FOR LEE COUNTY _________________________________________________________________ APPELLANT'S REPLY BRIEF _________________________________________________________________ APP. CASE NO.: 2D11-1830 L.T. No.: 08-CA-055898

Barbara Goolsby, Esq. Florida Bar No. 293581 Angela Thompson, Esq. Florida Bar No. 0054320 Florida Rural Legal Services, Inc. 3210 Cleveland Avenue, Suite 101 Fort Myers, Florida 33901 Telephone: 239-334-4554 Facsimile: 239-334-3042 Attorneys for Defendants/Appellants

TABLE OF CONTENTS TABLE OF CITATIONS.................................. PRELIMINARY STATEMENT............................... STATEMENT OF THE FACTS AND OF THE CASE.............. ARGUMENT I. WHETHER DEUTSCHE BANK HAD STANDING TO FORECLOSE WHEN THE COMPLAINT WAS FILED............................. WHETHER DEUTSCHE BANK HAD UNCLEAN HANDS....................................

II.

III. WHETHER THOMAS JOHNSON DEMONSTRATED EXCUSABLE NEGLECT........................ CONCLUSION......................................... CERTIFICATE OF SERVICE............................. CERTIFICATE OF TYPE SIZE AND STYLE.................

TABLE OF CITATIONS Case Law BAC Funding Consortium, Inc. v. Jean Jacques, 28 So.3d 936 (Fla. 2d DCA 2010).......................... Franz Tractor Co. v. J.I. Case Co., 566 So.2d 524-526 (Fla. 2d DCA 1990)..................... Shakil Khan v. Bank of America, N.A., 58 So.3d 927 (Fla. 5th DCA 2011)......................... Progressive Express Insurance Company v. McGrath, 913 So.2d 1281 (Fla. 2d DCA 2005).......................

PRELIMINARY STATEMENT Appellants shall refer to themselves individually by name as the Johnsons or as Appellants. Appellants shall refer to Appellee individually by name as Deutsche Bank or as Appellee. Appellants refer to Appellees Answer Brief by the prefix AB. Appellant shall refer to the record on appeal by the prefix R. Citations to the Appendix to the Initial Brief on the merits shall be as follows: (AIB, Tab #).

STATEMENT OF THE FACTS AND OF THE CASE In the answer brief statement of facts, Deutsche Bank says it disagrees in part with statements made in the Johnsons Statement of the Case and Facts. (AB p.1, l.2) However, Deutsche Bank fails to state in the answer brief statement of facts which statements in the Johnsons Statement of the Facts Deutsche Bank finds objectionable or why. Nevertheless, it is undisputed by Deutsche Bank in the

answer brief that the mortgage foreclosure complaint at issue (AIB#1) was filed in the name of Plaintiff Deutsche Bank,

National Trust Company as trustee; that the mortgage at issue attached to the complaint is payable to Challenge Financial

Investors, Corp.; that the note attached to the complaint is endorsed to Saxon Mortgage, Inc.; that the assignment of

mortgage attached to the complaint is assigned to Deutsche Bank Trust Company Americas, formerly known as Bankers Trust Company as Trustee and custodian by Saxon Mortgage Services, Inc., f/k/a Meritech Mortgage Services, Inc., as its attorney-in-fact; all of which facts were stated in the Johnsons Statement of Facts in the initial brief. 6

It is also undisputed by Appellee in the answer brief that not until four months after the complaint was filed did

Plaintiff Deutsche Bank file what it called an original note (AIB#3) endorsed to an entity named, NOT Deutsche Bank National Trust Company like the plaintiff, BUT Deutsche Bank Trust

Company Americas formerly known as Bankers Trust Company, as Trustee and Custodian by Saxon Mortgage Services, Inc., f/k/a Meritech Mortgage Services, Inc., as its attorney-in-fact.

ARGUMENT

I.
II.

WHETHER DEUTSCHE BANK HAD STANDING TO FORECLOSE WHEN THE COMPLAINT WAS FILED WHETHER DEUTSCHE BANK HAD UNCLEAN HANDS WHETHER THOMAS JOHNSON DEMONSTRATED EXCUSABLE NEGLECT the answer brief, Deutsche Bank did not address the

III.
In

first two prongs of the Johnsons argument as listed above in the initial brief; or present rebuttal arguments to the first two prongs of the Johnsons arguments in the answer brief. Instead, Deutsche Bank concentrated upon arguing against

the third prong of the Johnsons argument that Thomas Johnson demonstrated excusable neglect even though he failed to file a timely answer. 8

According to Deutsche Bank, the Johnsons failed to show excusable neglect because...It was not until January 20, 2010, more than a year after the complaint was filed and served upon them and just nine days short of one year after the default judgment was entered, that the Appellants finally responded in any way to the instant litigation... (AB p.2, l.5) The Johnsons cannot agree with Deutsche Banks position. The Johnsons borrowed money from Challenge Financial and had never heard of Deutsche Bank until they were served with a

foreclosure complaint. At the time the foreclosure complaint was served, Mr. Johnson had just been laid off from his construction job and he was frantically looking for work nationwide. The

Johnsons had no lawyer (and could not afford to hire one) to advise them that even though they had never done business with Deutsche Bank or received any notice from Challenge Financial that their loan had been transferred, the foreclosure complaint required an answer. It was not until the Johnsons received a foreclosure judgment in the mail almost a year later that the Johnsons realized their homestead was about to be sold out from under them. But even if the appeals court were to find that Defendant Johnsons lack of representation by a lawyer and laymans

conclusion that the foreclosure complaint against him must have 9

been a mistake did not constitute excusable neglect below, the Court would still be required to reverse the final judgment of foreclosure for the following reasons under the following cases. First, the trial judge made the decision to deny the

Johnsons motion for relief based on the arguments of counsel during an eleven minute hearing which was not evidentiary. Neither the submission of affidavits not argument of

counsel is sufficient to constitute an evidentiary hearing. AviIsaac v. Wells Fargo Bank, NA, 59 So. 3d 174,177( Fla. 2d DCA 2011.) Second, the documents attached to the complaint

contradicted the allegation of the complaint that the Plaintiff Deutsche Bank was the owner of the note and mortgage at issue. Third, the Plaintiffs lack of standing at the inception of a case is not a defect which can be cured by filing documents later in the case.

In BAC Funding Consortium, Inc. v. Jean Jacques, 28 So.3d 936 (Fla. 2d DCA 2010) the Court in a foreclosure case said: [Summary Judgment reversed because U.S. Bank failed to

establish its status as legal owner and holder of the note and mortgage...] In the instant case, the 10 attachments to the complaint

(AIB#1)

contradicted

the

allegation

of

the

complaint

that

Deutsche Bank was the owner and holder of the note and mortgage and so under BAC Funding, the judgment must be reversed. 28 So.3d 939. In the instant case, the Plaintiffs name was Deutsche Bank National Trust Company as trustee and the note attached to the complaint was endorsed to Saxon Mortgage, Inc. Thus, the attachment to the complaint contradicted an

allegation in the complaint that ...Deutsche Bank is the legal and/or equitable owner of the note and mortgage... According to the Second District Court of Appeal speaking in another case, ...[a]ny exhibit attached to a pleading is part of the pleading for all purposes, and if an attached

document negates a pleaders cause of action, the plain language of the document will control... Franz Tractor Co. v. J.I. Case Co., 566 So.2d 524-526 (Fla. 2d DCA 1990). The Second Fifth Circuit Court Court of of Appeal in has agreed with the case

District

Appeal

another

foreclosure

decided this year. According to the Fifth District, when a plaintiff in a

foreclosure alleges in a foreclosure complaint that it is the owner of a note and mortgage, and a note attached to the

complaint is endorsed to a bank other than the plaintiff, then 11

the

plaintiff

has

not

established

that

it

has

standing

to

foreclose the mortgage as a matter of law. Shakil Khan V. Bank of America, N.A., 58 So.3d 927 (Fla. 5th DCA 2011). Although the plaintiff in the instant case tried to

resurrect its standing four months after the complaint was filed by filing with the trial court an original note (AIB#3)

endorsed to Deutsche Bank Trust Company Americas formerly known as Bankers Trust Company, as Trustee and custodian by Saxon

Mortgage Services, Inc., f/k/a Meritech Mortgage Services, as attorney in fact, the effort must fail. Under another Second District case, the plaintiffs lack of standing at the inception of the case is not a defect that may be cured by the acquisition of standing after the case is filed. Progressive Express Insurance Company v. McGrath, 913 So.2d 1281 (Fla. 2d DCA 2005). Thus, as it is in this case, when the Plaintiff Deutsche Bank failed to establish standing at the time the complaint was filed as shown by the attachments to the complaint, this was an error which could not be corrected later on. Therefore, when

Deutsche Bank filed an endorsed note four months later, it was too late to correct the lack of standing at the inception of the case. CONCLUSION 12

For the above reasons and based on the above cases,

the

Johnsons are asking the Appeals Court to reverse the trial courts judgment of foreclosure and to remand this case to the trial court for discovery and trial. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the

foregoing was furnished by U.S. Mail this ___ day of _________, 2011, to Kimberly N. Hopkins, Esquire, Shapiro, Fishman & Gach, LLP, 4630 Woodland Corporate Blvd., Suite 100, Tampa, FL 33614.

Respectfully submitted, __________________________ Barbara Goolsby Florida Bar No. 293581 Florida Rural Legal Services, Inc. 3210 Cleveland Avenue, Suite 101 Fort Myers, Florida 33901 Telephone: 239-334-4554 Facsimile: 239-334-3042 Attorneys for Appellant

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CERTIFICATE OF COMPLIANCE This is to certify that the type size and style set forth in this Reply Brief is 12 point Courier New in compliance with Rule 9.100(1), Florida Rules of Appellate Procedure.

________________________ Attorney for Appellant

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