A task force created this past spring to examine Florida's foreclosure crisis has recommended to the state's Supreme Court that all foreclosure proceedings go through a managed mediation process.
The recommendation was made in the task force's final report, which was released Monday. According to the task force, headed by 11th Circuit Judge Jennifer Bailey, the state's courts should offer differentiated processing of three categories of foreclosure cases.
For homestead properties (i.e., owner-occupied), borrowers should be referred to managed mediation, vacant and abandoned properties should be fast-tracked in an expedited foreclosure process, and other foreclosure cases – which may include tenant-occupied or non-borrower-occupied properties, in which the borrower has been unable to communicate with the plaintiff to resolve the case – should be referred to the managed mediation program at equal cost to both parties.
The task force also suggests that plaintiffs in foreclosure cases be required to sign off on Form A documents, which certify the subject property is homestead property, the names of plaintiff's representatives having settlement authority, and whether the plaintiff and the borrower participated in pre-suit mediation with the mediation manager. Plaintiff's counsel must further certify on the form the identity of the plaintiff's representative who will appear at the mediation.
The Supreme Court has not yet adopted the task force's suggestions, although attorney Roy Oppenheim, of Oppenheim Pilelsky PA, says he is "confident" the Supreme Court will accept the mediation proposals. Currently, Florida's foreclosure proceedings vary by judicial circuits – some circuits mandate mediation, some have opt-in programs and others have no mediation at all. The Supreme Court's creation of the task force was largely viewed as a response to the state's fragmented processes.
The Supreme Court's acceptance of the task force's recommendations would create consistency, Oppenheim says.
Oppenheim points out that one of the report's major suggestions is the requirement that plaintiffs, upon request of the borrower, must deliver to the mediation program manager evidence that the plaintiff is the owner and holder of the mortgage, a life of loan history, a statement of the plaintiff's position on the net present value of the loan, and any current appraisal – all of which would occur prior to mediation.
"That means that the banks must, under oath, state that the facts in the complaint are true," Oppenheim writes on his South Florida Law blog. "Simply put, the banks can no longer say that their note is lost or stolen if, in fact, they subsequently are able to find it. Since they have verified the complaint, they will not be able to continue such a business practice."