The Florida Supreme Court has found that voluntarily dismissed foreclosure cases can’t be reopened when there are allegations of fraud, an important ruling in a state that saw a lot of foreclosures during the housing crisis.
In this case, Bank of New York Mellon Corp. brought a foreclosure in 2008 against homeowner Roman Pino, who had a Bank of America mortgage. Pino alleged that the bank’s documents were fraudulently backdated in conjunction with “robo-signing,” a practice in which law firms and banks signed off on foreclosure documents without checking to see if they were accurate.
Pino asked the court to dismiss the case, but before it could, BNY Mellon voluntarily dismissed the suit. It later refiled against Pino, using different documents, and Pino’s lawyer argued that the bank should not be allowed to do that when it committed fraud the first time. Pino’s lawyer requested that the court reopen the first case.
Even though Pino and BNY Mellon reached a settlement before the case made it to the Florida Supreme Court, the court decided to hear it anyway, and found that voluntary dismissals can’t be reversed because of fraud allegations, unless the plaintiff had gotten relief and the dismissal kept the court from remedying the fraud.
The Supreme Court decision was announced Thursday.
This article was originally posted at InsideCounsel.com, a sister site of Credit Union Times.