IN THE SUPREME COURT OF FLORIDA CASE NO. SC02-2545 BEAL BANK, S.S.B., INC., Petitioner, vs. IRWIN J. and MARCIA M. SHERWIN, Respondent. --------------------------------------------------------------------------------------------- ON REVIEW FROM THE FOURTH DISTRICT COURT OF APPEAL CASE NO. 4D02-1196 --------------------------------------------------------------------------------------------- BRIEF ON JURISDICTION OF BEAL BANK, S.S.B., INC. HOLLAND & KNIGHT LLP Steven L. Brannock Brian McDowell Suzanne Gilbert P.O. Box 1288 Tampa, Florida 33601 (813)227-8500
TABLE OF CONTENTS TABLE OF CONTENTS...i TABLE OF CITATIONS... ii BRIEF ON JURISDICTION... 1 STATEMENT OF THE CASE AND FACTS... 2 SUMMARY OF THE ARGUMENT... 4 ARGUMENT... 5 CONCLUSION... 10 CERTIFICATE OF SERVICE... 11 CERTIFICATE OF TYPEFACE COMPLIANCE... 11 i
TABLE OF CITATIONS FEDERAL CASES Federal Trade Commission v. Minneapolis-Honeywell Regulator, 344 U.S. 206 (1952)6 Betts v. Fowelin, 203 So. 2d 630 (Fla. 4th DCA 1967)6 Blackstock v. Blackstock, 776 So. 2d 359 (Fla. 1st DCA 2001)7 Brick v. Brick, 258 So. 2d 7 (Fla. 4th DCA 1971)6 City of Lake Worth v. Walton, 443 So. 2d 405 (Fla. 4th DCA 1984)9 STATE CASES City of Newark v. Fisher, 70 A.2d 733 ALR 2nd 280 (N.J. 1950)6 Daytona Migi Corp. v. Daytona Automotive Fiberglass, Inc., 417 So. 2d 272 (Fla. 5th DCA 1982)6 DeGale v. Krongold, Bass & Todd, 773 So. 2d 630 (Fla. 3d DCA 2000)6 First Continental Corp. v. Kahn, 605 So. 2d 126 (Fla. 5th DCA 1992)7-10 Hialeah Hotel, Inc. v. Woods, 778 So. 2d 314 (Fla. 3d DCA 2001)7 Kline v. Belco, Ltd., 480 So. 2d 126 (Fla. 3d DCA 1985)8 ii
Rogers v. First National Bank at Winter Park, 232 So. 2d 377 (Fla. 1970)7 St. Moritz Hotel v. Daughtry, 249 So. 2d 27 (Fla. 1971)6 OTHER AUTHORITY Rule 9.110(h), Fla. R. App. P.9 Rule 1.540, Fla. R. Civ. P.1, 7, 8 Rule 1.540(b), Fla. R. Civ. P. 5, 7-10 iii
BRIEF ON JURISDICTION This Petition, filed by Beal Bank, S.S.B., Inc., addresses an important and interesting conflict in appellate procedure concerning the scope of an appeal from an amended final judgment. According to this Court, where an amended final judgment is entered that materially changes the original judgment, the 30-day appeal period runs from the date the amended final judgment is entered. Decisions of this and other courts also suggest that a notice of appeal filed within 30 days of the amended judgment permits a plenary appeal in which the appellant may raise all issues raised by the case, including those issues that would have been raised in a timely appeal from the original judgment. In direct conflict with this precedent, the Fourth District Court of Appeal held below that a notice of appeal filed within 30 days of the entry of an amended judgment permits an appeal only by the party opposing the amendment and only as to those issues directly raised by the amendment. In reaching this conclusion, the court below made no attempt to reconcile its holding with previous decisions of this and other Florida courts permitting a plenary appeal from the amended judgment. Instead, the court relied on another black letter law proposition (which Beal does not assail here) that an unsuccessful Rule 1.540 motion for relief from judgment does not extend the appeal period from the original judgment. Beal Bank never suggested any such thing. Instead, Beal Bank argued that its appeal period was impacted by the trial court's entry of an amended judgment. The 1
filing of an unsuccessful Rule 1.540 motion is irrelevant because it does not result in the entry of a materially amended judgment. This Court should grant Beal's petition and reconcile the conflicting authority on the nature of the appeal that can be taken from an amended judgment. STATEMENT OF THE CASE AND FACTS This case concerns an attempt by Beal Bank to collect on notes executed by the appellees, Irwin and Marcia Sherwin, totaling nearly $1,400,000 in favor of Beal Bank's predecessor-in-interest, Southeast Bank (A-1,7,8). 1 The Sherwins admit the debt (A-14 at p. 193; A-9,15). Beal Bank proved that all rights to collect the notes were assigned by Southeast through a chain of assignments that ultimately led to Beal Bank (A-11,12,30). The trial court, however, erroneously held that Beal Bank had no right to collect on the notes because the original notes were lost somewhere in this chain of assignments (A-26). Entry of Final Judgment and the First Appeal The trial court's final judgment went beyond the denial of Beal Bank's right to enforce the debt. The court's final judgment also granted additional relief never sought by the Sherwins. The final judgment declared the mortgages encumbering the property to be "null and void" (A-26). Beal Bank filed an untimely motion for rehearing from the final judgment (A- 1 References to "A" refer to the appendix filed with the Fourth DCA. 2
27; PA 1). 2 The untimely motion did not toll the time period for Beal Bank's appeal and, as an unfortunate consequence, Beal Bank's appeal was also untimely. The Fourth District dismissed the appeal without opposition from Beal Bank (A-28; PA 1). The Motion for Relief of Judgment and the Current Appeal Beal Bank filed a motion for relief from judgment arguing, among others things, that the trial court's order was void, at least in part, because it granted relief that was not supported by the pleadings or the substantive law upon which those pleadings were based. In particular, Beal Bank focused on the trial court's declaration of the mortgages to be null and void (A-28; PA 1). The trial court denied the relief from judgment but agreed that the original judgment declaring the notes null and void was a mistake. Accordingly, the trial court amended the judgment to delete the declaration that the mortgages were null and void. (A-29; PA 1). Beal Bank appealed. 3 The Fourth District affirmed without ever reaching the merits. Instead, the court held that the entry of the amended judgment did not start the appeal period anew. According to the court, an appeal from an amended judgment could be taken only by the party adversely affected by the amendment and was limited to only those issues raised by the amendment (PA 1). 2 References to "PA" refer to the appendix attached to this decision containing the decision of the Fourth District Court of Appeal below. 3 The Sherwins also appealed the trial court's decision to amend the judgment but later dismissed that appeal. 3
Beal Bank's Petition for review followed. 4
SUMMARY OF THE ARGUMENT Florida law is well settled that the entry of a materially amended final judgment starts a new 30-day period for taking an appeal. Florida law is equally settled that the appeal from the amended judgment is a plenary appeal permitting the appellant to raise any issue raised by the case. This principal is illustrated most frequently by those cases where Rule 1.540(b) relief is granted and an amended judgment is entered because the appellant never received a copy of the final order. The re-entry of the judgment permits a plenary appeal even though the original appeal period may have long expired. The decision below directly conflicts with these decisions by holding that the entry of an amended judgment permits an appeal only by the party opposing the amendment and only as to issues raised by the amendment. In reaching this conclusion, the court erroneously relied on cases holding that the filing of an unsuccessful Rule 1.540(b) motion for relief from judgment does not extend the appeal period from the original judgment. The court overlooked the obvious. An unsuccessful Rule 1.540(b) motion does not result in the entry of an amended judgment. The court made no attempt to reconcile its narrow treatment of the amended judgment with decisions of this and other courts holding that a plenary appeal is permitted from the amended judgment. This Court should grant Beal Bank's Petition for Review and resolve the conflict created by the court below. 5
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ARGUMENT The Fourth District's determination that the entry of the amended judgment did not start a new thirty-day period for the purposes of a plenary appeal is in conflict with decisions of this Court and other District Courts of Appeal. The leading case is St. Moritz Hotel v. Daughtry, 249 So. 2d 27, 28-29 (Fla. 1971). According to this Court, "where the modification or amendment materially changes the order or judgment, the limitation period is said to run from the time of such modification or amendment." Id. at 28. 4 St. Moritz follows the majority rule nationally. See City of Newark v. Fisher, 70 A.2d 733, 21 ALR 2nd 280 (N.J. 1950); Federal Trade Commission v. Minneapolis-Honeywell Regulator, 344 U.S. 206, 211-12 (1952) ("when a trial court enters an amended judgment changing a matter of substance, the period within which an appeal must be taken or petition for certiorari filed begin[s] to run anew"). Other cases in Florida follow the general rule. 5 There can be no dispute that the amended judgment entered in this case was a material change from the first judgment. The trial court deleted that portion of the judgment that erroneously held the mortgages to be null and void. This change materially changed the scope and import of the judgment. Obviously, the Sherwin's agreed that the amendment was substantive they filed a cross-appeal from the 4 By contrast, a clerical or non-substantive change has no affect on the time for taking an appeal. See, e.g., Brick v. Brick, 258 So. 2d 7 (Fla. 4th DCA 1971). 5 DeGale v. Krongold, Bass & Todd, 773 So. 2d 630, 631 (Fla. 3d DCA 2000); Daytona Migi Corp. v. Daytona Automotive Fiberglass, Inc., 417 So. 2d 272, 274 (Fla. 5th DCA 1982); Betts v. Fowelin, 203 So. 2d 630, 631 (Fla. 4th DCA 1967). 7
entry of this amended judgment. The Sherwin's later dismissed this appeal implicitly recognizing the correctness of the trial court's decision to amend the judgment. Despite this authority, the Sherwins argued, and the Fourth District agreed, that the amended judgment did not supercede the original judgment. Relying on an earlier decision of the Fifth District Court of Appeal in First Continental Corp. v. Kahn, 605 So. 2d 126 (Fla. 5 th DCA 1992), the court held that any right of appeal created by the amended judgment related only to the amendment and not the unchanged portions of the judgment. This holding, however, conflicts with other Florida cases that have enforced the general rule that a plenary appeal is permitted from an amended judgment. For example, Rule 1.540 motions are often utilized when a party does not receive notice of a judgment in time to take an appeal. In such circumstances, the trial court may grant the rule 1.540 relief and enter a new final judgment. This final judgment supercedes the earlier judgment and permits a plenary appeal from the re-entered judgment including all of the issues that would have been raised in a timely appeal from the original judgment. See, e.g., Rogers v. First National Bank at Winter Park, 232 So. 2d 377 (Fla. 1970) (permitting a plenary appeal from the new judgment); Hialeah Hotel, Inc. v. Woods, 778 So. 2d 314 (Fla. 3d DCA 2001) (same); Blackstock v. Blackstock, 776 So. 2d 359 (Fla. 1st DCA 2001) (same). Similarly, Rule 1.540 motions may be granted based on newly discovered 8
evidence or the discovery of fraud on the court. See Rule 1.540(b). In such cases, the granting of the motion will often result in further proceedings such as a new trial which will then lead to the entry of a new judgment. See, e.g., Kline v. Belco, Ltd., 480 So. 2d 126 (Fla. 3d DCA 1985). Obviously, the entry of the new judgment following the new trial would give either side the right to plenary appeal from all issues raised by the case. It would then be impossible to restrict review to just the new facts offered as a result of the Rule 1.540 motion. The propriety of the new verdict would have to be examined based on all the facts, old and new. Neither the Fourth District nor the Kahn case upon which it relies made any attempt to reconcile their conclusions with this established body of precedent holding that the materially amended judgment supercedes the earlier judgment. Instead, the Fourth and Fifth Districts relied on the many cases that suggest that Rule 1.540(b) motions for relief from judgment cannot be used as a substitute for a failed appeal. Beal Bank concedes that the denial of Rule 1.540(b) relief cannot serve as a platform for an appeal of the underlying merits of the original judgment. When a Rule 1.540(b) motion is denied, there is no entry of an amended judgment. This case is different. In this case, as in the cases upon which Beal Bank relies, the trial court granted Rule 1.540(b) relief and, as a result, entered an amended judgment materially changing the original judgment. It is the trial court's meritorious entry of the amended judgment that revived Beal Bank's right to an appeal, not the Rule 1.540(b) motion. 9
Simply put, Beal Bank does not seek a review of the original judgment that judgment has now been superceded. Instead, Beal Bank seeks a review of the amended judgment entered because of the trial court's appropriate decision to reopen the case to fix the problems with its first order. Once a case is re-opened and an amended final judgment is entered, that judgment is subject to the same review as any judgment. Nothing could be more well-settled than the proposition that an appeal from a final judgment permits review of all issues that led to the entry of that judgment. Fla. R. App. P. 9.110(h); See, e.g., City of Lake Worth v. Walton, 443 So. 2d 405 (Fla. 4th DCA 1984). Neither Kahn nor the decision below make any attempt to reconcile their holdings with the cases discussed above illustrating that a new judgment entered pursuant to a Rule 1.540(b) motion necessarily supercedes the earlier judgment. For example, if Kahn and the decision below were correct, how could courts utilize Rule 1.540(b) to permit re-entry of a judgment when the party did not receive notice of the judgment? This mechanism is meaningless unless the entry of the new judgment supercedes the earlier judgment and permits an appeal of all issues. Similarly, in cases where new trials are held as a result of discovery of new evidence or fraud on the court, this new trial necessarily results in a new judgment that completely supercedes the first judgment. It would be impossible in such cases to separate out issues relating only to the amended judgment. Thus, contrary to the reasoning of the court below, it would be impossible to limit any appeal to 10
only issues raised by the amended judgment. Indeed, the Fifth District in Kahn acknowledged that there are difficulties with its conclusion. As the Fifth District acknowledged, "limited appeal of amended judgments to certain issues only in determining the appealability of an amended judgment by gauging which party is adversely affected by the amendment, can present substantial difficulties in many contexts that are easily imagined. We agree with our sister court in Oregon that "there are problems with either answer." Id. at 130, citing, Lee v. Magnuson, 660 P.2d 1095, 1097 n.2 (Oregon 1983). In fact, Lee reaches precisely the opposite result reached by this case. Lee holds that the entry of an amended judgment essentially supercedes the earlier judgment and permits an appeal of all issues raised by the case, not just issues raised by the amendment [amended judgment]. See id at 1097 n.2 (holding that the court had jurisdiction over the appeal). As Kahn illustrates, this case presents an important issue worthy of this court's review. There is a direct clash between those cases that hold that the entry of an materially amended judgment permits a plenary appeal and the more limited approach taken by Kahn and the Court below. This Court should grant Beal Bank's Petition for Discretionary Review to resolve that conflict. CONCLUSION For all the foregoing reasons, this Court should accept jurisdiction over this case and resolve the conflict created by the decision below. 11
Steven L. Brannock Florida Bar No. 319651 HOLLAND & KNIGHT LLP P.O. Box 1288 Tampa, Florida 33601-1288 Telephone (813) 227-8500 Facsimile (813) 229-0134 Brian A. McDowell Florida Bar No. 765521 Suzanne E. Gilbert Florida Bar No. 094048 HOLLAND & KNIGHT LLP 200 S. Orange Avenue, Suite 2600 Post Office Box 1526 Orlando, Florida 32802-1526 Telephone: (407) 425-8500 Facsimile: (407) 244-5288 Attorneys for Petitioner, Beal Bank, S.S.B. 12
CERTIFICATE OF SERVICE I HEREBY CERTIFY on this day of December, 2002 that a true and correct copy of the foregoing Jurisdictional Brief has been furnished via First Class U.S. Mail to: Charles Wender, Esquire, 190 East Palmetto Park Road, Boca Raton, Florida 33432 and to all parties on the attached service list. Attorney for Petitioner Beal Bank, S.S.B., Inc. CERTIFICATE OF TYPEFACE COMPLIANCE Counsel for Petitioner, Beal Bank, S.S.B., Inc., certifies that this Jurisdictional Brief is typed in 14 point (proportionately spaced) Times New Roman, in compliance with Rule 9.210 of the Florida Rules of Appellate Procedure. TPA1 #1264510 v1 Attorney 13