90 Day Notice Required to Evict Remaining Tenants After Foreclosure.

A writ of possession was recently quashed in Volusia County, Florida when it was determined that the remaining tenants in possession of a home after foreclosure had not been given 90 days notice to vacate pursuant to the Protecting Tenants at Foreclosure Act of 2009.  It is interesting to note, however, that the act only protects bona fide tenants, which do not include: (1) the mortgagor or the child, spouse, or parent of the mortgagor.  Also the lease or tenancy must have been the result of an arms-length transaction; and the lease or tenancy required the receipt of rent that is not substantially less than fair market rent for the property or the unit’s rent is reduced or subsidized due to a Federal, State, or local subsidy.  See opinion below.

CITIMORTGAGE INC, Plaintiff, v. GLENN E. LUTZ, et al., Defendants. Circuit Court, 7th Judicial Circuit in and for Volusia County. Case No. 2009 35312 CICI, Division 31. January 29, 2014. Honorable Terence R. Perkins, Judge. Counsel: Jimmy Allen Davis, Law Offices of Jimmy Allen Davis, P.L., Deltona, for Interested Third Parties. Daniel J. Webster, Daniel J. Webster, P.A., Daytona Beach, for Successor-in-Interest.

THIS CAUSE, having come before this Court on Interested Third Parties’ Emergency Motion to Quash Writ of Possession, and the Court being fully advised in the premises, the Court does hereby

ORDER, ADJUDGE and FIND as follows:

1. A judgement of foreclosure was entered on the 15th day of October, 2013 and the property was sold to a successor in interest, Ryan Henson #10 Land Trust (“Owner”). A Certificate of Title was entered on the 17th day of December, 2013, transfering ownership to the successor in interest.

2. Interested Third Parties, Paula and David Meeks (“Tenants”), were at the time tenants in possession of the property in dispute in this action (“Property”).

3. On the 2nd day of January, 2014, a Writ of Possession was issued and served upon the residents of the Property. The Tenants filed an Emergency Motion to Quash the Writ of Possession, citing the Protecting Tenants at Foreclosure Act of 2009, which provides that any immediate successor in interest to residential real property subject to foreclosure of a federally related mortgage loan shall assume the interest subject to “the provision, by such successor in interest of a notice to vacate to any bona fide tenant at least 90 days before the effective date of such notice.”

4. The Act defines bona fide lease or tenancy as one in which: (1) the mortgagor or the child, spouse, or parent of the mortgagor under the contract is not the tenant; (2) the lease or tenancy was the result of an arms-length transaction; and (3) the lease or tenancy requires the receipt of rent that is not substantially less than fair market rent for the property or the unit’s rent is reduced or subsidized due to a Federal, State, or local subsidy.

5. In 2010 the Act was amended by Congress, clarifying the date of a Notice of Foreclosure as “the date on which complete title to a property is transferred to a successor entity or person”, in this case: December 17, 2013. See Providence Comm. Assoc., Inc. v. Bio, 18 Fla. L. Weekly Supp. 1036a (10th J. Cir., 2011).

6. Under the act, a bona fide tenant who is under a valid lease entered into before the Notice of Foreclosure may be given a 90 day notice to vacate which becomes effective on the date of sale to a purchaser who intends to live on the property as a primary residence. Otherwise the tenant may complete the lease term if no sale is made. A bona fide tenant without a lease or lease terminable-at-will may have their tenancy terminated at any time after a 90 day notice to vacate is issued to said tenant.

7. Mr. and Ms. Meeks entered into a lease agreement with the Defendant on the lst day of January, 2013. The initial term of the lease agreement was 6 months. Thereafter an attempt to extend the lease agreement for a year until July 1, 2014 was made by the parties by noting next to the lease term “Advance 1 yr 2014”.

8. The Court overruled Plaintiff’s objection to Ms. Meeks being a party to the action because her name was not on the lease. Ms. Meeks explained that the reason her son signed the lease agreement alone was because she was not available at the time of signing but that she helped pay the rent and otherwise conducted business as one of the tenants living on the property.

9. Mr. and Ms. Meeks are bona fide tenants in possession of the Property and as such, must be given a 90 day notice to vacate the property, which becomes effective on the sale date of the property to a purchasor from Ryan Henson #10 Land Trust. That purchaser must intend to live on the property as a primary residence.

10. Tenant’s Emergency Motion to Quash Writ of Possession is hereby GRANTED and the Writ of Possession is QUASHED. The Court retains jurisdiction to determine if Mr. and Ms. Meeks are entitled to attorney fees; costs; and to hear any other motions and grant any other relief in furtherance with this order and ruling in this case.