WHAT IS A CONTINUING TORT?
EFFS v. SONY PICTURES HOME ENTERTAINMENT, INC., No. 3D15-1139 [August 10, 2016]
Effs claimed a 25% ownership interest in a motion picture he helped produce in 2005. Behind Effs’ back, other participants met with Sony and entered into a licensing agreement that gave Sony exclusive distribution rights. Distribution payments commenced in October 2005 to the others. In May 2007, Effs’ counsel emailed Sony asserting that Effs had participation rights in the movie. In March 2012, Effs brought suit against Sony for tortious interference with a business relationship.
The trial court granted Sony’s motion for summary judgment premised on the expiration of the statute of limitations. Holding out the “continuing tort” doctrine, Effs appealed arguing that each distribution payment furthered the tort and therefore only the last of said payments triggered the start of the statute of limitations time period. Effs’ argument was rejected and the dismissal affirmed.
Although the appellate court recognized that a cause of action finally accrues when the tortious conduct ceases, it pointed out that it is the tortious act, not the harmful effects of the act, that triggers the start of the limitations period. It was the act of the licensing agreement, not the payments under that agreement, that were tortious. The payments were deemed merely harmful effects. It is believed by the court that their analysis of the continuing tort doctrine, in the context of an action for tortious interference in a business relationship, is one of first impression in Florida.
MASLAK v. WELLS FARGO, Nos. 4D14-4672, 4D14-4673 and 4D14-4707 [April 6, 2016]
Following Maslak’s default on three loans, Wells Fargo foreclosed. The cases, consolidated for trial, resulted in three final judgments, each of which was appealed and further consolidated. The sole issue presented was whether the bank had properly introduced evidence in accordance with the business records exception – in order to overcome Maslak’s hearsay objections. Not unusual, the records in question were printed screen shots of the payment histories. It was not necessary for the bank to present the person who actually prepared the business records. However, the witness was unable to testify that the information was supplied by someone who had personal knowledge and created the records “in the course of a regularly conducted business activity.” Although, the witness did testify as to each of the four elements underlying a business records exception, just saying the “magic words” was not enough. The witness was unable to testify as to whether someone at the office of the attorneys representing the bank could have changed the records, nor did she know how the payments were received and processed. Judgments were reversed and the case was remanded for further proceedings.
Vidal -v- Liquidation Prop., 104 So. 3d 1274 (Fla. 4th DCA 2012)
Following entry of summary judgment of foreclosure for the lender, the Vidals appealed arguing that affirmative defenses precluded such judgment. Among the defenses were lack of standing, Truth In Lending Act (TILA) violations, and two types of fraud. Having untangled the facts, the appellate court agreed with the Vidals that for the lender to have standing, the lender had to prove ownership and possession of the note on the date suit was filed. An assignment of mortgage was produced, but it transferred only the mortgage not the note, and as all should know “the mortgage follows the note.” An allonge to the note was produced but it was not dated. An affidavit by the lender attesting that it received transfer of the note prior to filing would have evidenced standing.
The appellate court also combed through Vidals argument as to the TILA defense and agreed with them. While the remedy of rescission has a three year statute of limitations, there is only a one year period for the remedy of recoupment unless brought by way of defense, as it was.
The defense of fraud allegedly arising from the lender’s knowledge that income was overstated was cut because one suffering from fraud cannot recover when they knew the statement to be false.
On the second fraud defense, wherein it was alleged that the lender had orally represented that the loan was a fixed rate when in fact it was adjustable, the appellate court found that such contention was expressly washed out by the written contract.
BONY Mellon -v- P2D2, 100 So. 3d 205 (Fla. 2d DCA 2012)
Lessee under a 100 year ground lease mortgaged the property. In all respects the mortgage instrument gives the appearance of a garden variety mortgage given by a land owner to secure a loan. Also signed on that date and handled by the same title agent was an assignment of the ground lease and the lessor’s consent thereto. When the lessee failed to pay rent to P2D2 an action was filed seeking possession, judgment for rent due, and a declaration quieting title, which action named as defendants the lessee (i.e the mortgagor) and the bank. P2D2 argued that the mortgage document was a nullity since, on its face, it purports to mortgage lands not owned by the lessee.
However, the appellate court found that when all the facts and circumstances were considered, the lessee had actually mortgaged its leasehold interest. The appellate court held for the bank on its appeal seeking to reverse entry of summary judgment on the quiet title count, but sustained entry of default against the bank under the count for possession. The Force was not with P2D2.
PLAKHOV -v- SEROVA, 126 So. 3d 1221 (Fla. 4th DCA 2012)
During the residential tenancy agreement, the landlord Serova was faced with a foreclosure action and difficulty paying the monthly assessments on the condominium unit rented to Plakhov. The tenant, having received notice of both the foreclosure action and nonpayment of the association dues, grew worried. Unknown to the tenant, the landlord was in discussions with the mortgage lender to modify the mortgage, and subsequently made modification payments to the lender.
Also unknown to the tenant, the landlord had brought her condominium association payments current two months before the tenant decided it was in his best interest to move out. It took several months for the landlord to find a new tenant. Consequently, the landlord not only took the security deposit but also obtained a money judgment for $16,700 against Plakhov. While affirming the judgment, the appellate court rejected the tenant’s defenses which included allegations of constructive eviction created by the landlord’s defaulted payments.
PALM BEACH MARKETPLACE -v- ALEYDA’S MEXICAN, 103 So. 3d 911 (Fla. 4th DCA 2012)
Petition for Mandamus was filed to compel the trial court to enter a default judgment and writ of possession. Tenant had failed to timely post rent into the court’s registry that came due and owing, as required by F.S. §83.232. The statute provides that failure to post rent alleged as past due, or that subsequently comes due, in an action for possession is an absolute waiver of defenses entitling the landlord to immediate default for possession.
This is a ministerial duty of courts, meaning there is no discretion beyond that stated in the statute. Although mandating entry of the writ of possession, the appellate court reminded the trial court that the statute only speaks to a default for possession and not to any entitlement to money damages or even to the funds previously deposited.
Blue Star -v- LED Trust, 128 So. 3d 36 (Fla. 3d DCA 2012)(cert. den'd)
LED Trust filed a lis pendens against property owned by the Blue Star group, an entity in which the LED Trust was investing. LED’s action turned on counts including breach of contract, violations of corporate statutory duties, fraud, conspiracy to commit fraud, and for an accounting. None of those counts could be plugged into the property owned by Blue Star. Other counts in equity were brought for declaratory and injunctive relief, imposition of a constructive trust or equitable lien, and for specific performance.
But, the appellate court found LED’s equitable claims to be dim in that they were lacking a necessary connection to the subject property. The appellate court illuminated that LED was really seeking damages arising from mere membership interests in an LLC. In conclusion, the appellate court found that LED’s claims failed to establish a fair nexus between the equitable or legal ownership of the subject property and LED’s claim. Accordingly, the lis pendens could no longer cast a shadow on the title.
Rex Russo has extensive appellate experience. He has appealed administrative action decisions, judgments of Florida's county and circuit courts, Bankruptcy Court judgments, and Federal District Court judgments. Appeals have been taken as far as the Florida Supreme Court and the United States Supreme Court.