I currently have a foreclosure surplus case in Miami-Dade County where a home owners’ association is trying to claim proceeds as a subordinate lien holder status. The interesting aspect is this HOA was never named as a Defendant in the case. Therefore, they have filed a motion to intervene (to become a party to the case) and are trying to claim funds.
Therefore, the main question presented is this: is the HOA a subordinate lien holder under Florida Statute 45.032? According to the statute, I would argue they are not.
Florida Statute 45.032 (1)(b) states: “Subordinate lienholder” means the holder of a subordinate lien shown on the face of the pleadings as an encumbrance on the property.
Further, Rodriguez v. FNMA, 220 So.3d 577 (Fla 5th DCA 2017) recently came out with a decision that quoted the following “No subordinate lienholders were shown on the face of the complaint.”
Therefore, the above language reflects, in my opinion, that a subordinate lien holder is only a valid subordinate lien holder, for surplus funds purposes, if they are named at the start of the case in the Complaint as a defendant.
Florida Statute 45.032 undoubtedly puts a very strong emphasis on the start of a foreclosure case. For instance, the owner of record is determined when a lis pendens is filed, not throughout the rest of the case.
This is another prime example of the complexity of foreclosure surplus law. If you have a potential claim for foreclosure surplus funds, please contact me for a free consultation!
Remember, I don’t get paid unless I collect surplus funds for you.
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