A business with multiple owners facing a foreclosure complicates things. This is because each owner’s limited say regarding how to respond can create conflict if they disagree regarding the best course of action.

Interested in knowing your rights and obligations in a foreclosure proceeding? Schedule a consultation and you'll speak with a Palm Beach Foreclosure Attorney. Just call our office at (561)472-0919 or complete a Consultation Request form to the right of the screen and we'll be in touch shortly.

A request to allow a foreclosure sale brought the matter of  SR Acquisitions -- Florida, LLC, v. San Remo Homes at Florida City, LLC, before the Florida 3rd DCA (appeals court.) The appeals court issued its decision on November 30, 2011.

San Remo Homes at Florida City, LLC, (San Remo) owned mortgaged property. Merici, Starmac, and Dinuro Investments, LLC, (Dinuro) owned San Remo.

Merici and Starmac invested additional funds into San Remo to avoid a mortgage default. Dinuro did not invest any funds for that purpose.

Merici and Starmac also restructured the debt and established SR Acquisitions – Florida, LLC, (SR) to take over the mortgaged property. Dinuro rejected an offer to participate in SR.

Merici and Starmac used SR to buy the mortgage from the original creditor. Acting as owners of San Remo, Merici and Starmac additionally caused San Remo to default on the mortgage.

The default prompted SR to initiate foreclosure proceedings. Arguing that San Remo lacked any valid defenses, Merici and Starmac decided that San Remo would not oppose the foreclosure.

San Remo not presenting a defense resulted in the trial court granting SR the requested foreclosure. 

Dinuro challenged the foreclosure’s validity and successfully postponed a foreclosure sale. It asserted specifically that Merici and Starmac violated the duty of care and other obligations that it owed San Remo. Dinuro contended as well that that misconduct included essentially freezing Dinuro out of its interest in the mortgaged property.

SR subsequently asked the appeals court to direct the trial court to allow the foreclosure sale to proceed.

The appeals court directed the trial court to reconsider SR’s request to allow the foreclosure sale.

The appeals court reasoned that SR met the standard for the requested mandamus relief under the decision in Caldwell v. Estate of McDowell, 507 So.2d 607 (Fla. 1987.) That guideline is that “it is well settled that mandamus will lie where the petitioner has a clear right to the performance of the particular duty sought and that he has no other legal method for obtaining relief.”

The appeals court noted that SR “has a clear legal right to have the trial court rule on the pending motion [to allow a foreclosure sale to proceed], and no other relief [than a grant of mandamus] can address a non-party’s [Dinuro’s] improper interference with the case’s progress.” 

The appeals court commented that Dinuro lacked any direct interest in the foreclosure and had no legal right to pursue a remedy regarding the pending foreclosure sale. 

The appeals court pointed out that only SR and San Remo were parties in the current lawsuit. The appeals court added that Merici and Starmac outvoted Dinuro regarding the relevant mortgage-related transactions.

Interested in knowing your rights and obligations in a foreclosure proceeding? Schedule a consultation and you'll speak with a Palm Beach Foreclosure Attorney. Just call our office at (561)472-0919 or complete a Consultation Request form to the right of the screen and we'll be in touch shortly.