Archive for October, 2010

Recent Case May Have Big Impact On Pollution Claims

Wednesday, October 20th, 2010

The Florida Supreme Court recently held that commercial fishermen may recover for damages resulting from pollution released into Florida waters.

In Curd v. Mosaic Fertilizer, LLC, 2010 WL 2400384 (Fla. 2010), Mosaic Fertilizer owned a large phosphogypsum storage container near Archie Creek in Hillsborough County. Despite alleged warnings about the safety status of their storage facility, Mosaic Fertilizer failed to fix an insufficiently-sized dike and consequently, the dike gave way on September 5, 2004. The dike failure caused pollutants to spill into Tampa Bay and kill a variety of wildlife. Having had the reputation of their potential catches damaged by this chemical spill, a group of commercial fishermen filed suit against Mosaic Fertilizer.

At trial and on appeal before the Second District Court of Appeal, the fishermen group’s claims were rejected.  The primary opposition to the claims was that the fishermen did not own the damaged property (i.e., the fish) and had only suffered economic losses.  When the case made its way to the Florida Supreme Court however, the fishermen were able to catch a break.

The state’s highest court found the fishermen’s claims based upon Florida Statute, s. 376.313(3), were appropriate.  The Florida Supreme Court explained that the fishermen’s statutory strict liability claim was consistent with the Florida legislature’s vision for this anti-pollution law.

The court also found that the fishermen’s negligence claim was appropriate.  The court noted that Mosaic Fertilizer owed a duty to everyone who were in the “zone of risk” and that the “commercial fishermen had a special interest within that zone of risk, an interest not shared by the general community.”  Thus, Mosaic Fertilizer was obligated to exercise prudent foresight and take sufficient precautions to protect that interest.

In short, the Florida Supreme Court held that the commercial fishermen were able to maintain both a statutory and common law cause of action for the pollution discharge by Mosaic Fertilizer.  The court permitted the fishermen to bring these claims even though they did not own the pollution damaged property.

The ruling in Curd appears to clear the way for anyone who has experienced a loss as a result of pollution.  One’s first thoughts run toward BP’s Gulf Oil Spill, but Curd’s reach appears to extend further.  For example, persons owning property adjacent to polluted lands who find that their property is stigmatized and devalued by the neighboring pollution might have claims against the polluter.  Much like the pollution is seeks to prevent, Curd’s potential effects appear to be far reaching.

Foreclosure and Foreclosure Defense: The System Can Work

Monday, October 18th, 2010

As this article is being written, Bank of America’s “freeze” on foreclosure proceedings is in place and it appears this large lender will soon be joined by others which will halt or slow down foreclosures (e.g., JP Morgan Chase and GMAC).

Regardless of one’s politics and opinions about the real estate boom and bust, the foreclosure mess is exactly that – a mess.  It appears that mortgage lenders have taken short-cuts, at best, and engaged in fraud, at worst, in an effort to push through thousands of home foreclosure actions.  There have been numerous stories from workers with lenders and in law firms which are described as foreclosure mills about documents being improperly signed and notarized.  There have even been news stories about people signing documents for foreclosure actions who did not even know what a mortgage was.

Is there a way out of this mess?  Yes.

First, lenders should hire competent, local counsel.

Attorneys who live and work in the neighborhoods where the foreclosure action they are handling are occurring have a better ability to and a vested interest in getting things right.  For example, it is highly unlikely that a Sarasota lawyer would mistakenly file a foreclosure action in Sarasota if the property described in the mortgage is located in Miami.  Local attorneys most likely know local zip codes and property addresses.  For another example, it is also highly unlikely that a Bradenton lawyer would engage in unprofessional and unethical conduct before a local judge in the course of handling a foreclosure case because he has a reputation to protect.

Banks and lenders will likely pay more in attorneys’ fees for local counsel than they currently do for foreclosure mills and their “robo-signers.”  Banks and lenders are, however, being penny wise and dollar foolish when they hire foreclosure mills.  It has been the author’s experience that foreclosure mills take far longer to complete foreclosure actions than local firms and they enjoy less success before local courts.  Lenders would do well to consider the costs attendant with delays in prosecuting foreclosure actions to their conclusion.

Second, defendants in foreclosure action should hire competent, legal counsel.

Defendants in foreclosure actions should hire competent, local counsel.  Our system of justice is an adversarial system.  Defendants need counsel to protect their rights and interests because the lender’s attorneys are obliged to protect the lender’s rights and interests.  A foreclosure action is like any other legal action and it should be treated as such.

Homeowners would benefit from hiring counsel because there are many defenses to a foreclosure action.  Homeowners might also have counterclaims against lenders based upon how the loan was made and/or how the loan was managed and handled through the alleged default.

Likewise, second mortgage holders, condominium owners’ associations, and other junior lien holders would benefit from representation.  For example, condominium owners’ associations are entitled to a priority status on their liens under Florida Statute, §718.116 which is superior to all but purchase money mortgages on a condominium unit.  If a condominium unit is sold on the courthouse steps (or, via an Internet auction), a buyer may be responsible for all past due assessments on the unit at the time of purchase and a bank may be liable for unpaid assessments going back as far as 12 months from the date the bank takes title to the unit.  A lawyer would help ensure that defendants’ rights are protected and enforced.

There is no need to change anything else in the judicial system.

The judicial system as applied to foreclosure actions can and does work.  It is unrealistic, however, to expect what works in Miami’s courts to work in Manatee County and vice versa.  If all parties in foreclosure actions were represented by local counsel, foreclosure actions would be more quickly and better resolved.