IN THE SUPREME COURT OF FLORIDA Case No. SC06-56 BEVERLY PENZELL AND BANK OF AMERICA, N.A., Petitioners, vs. STATE OF FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION, Respondent. RESPONDENT S ANSWER BRIEF ON JURISDICTION ALIKI MONCRIEF Senior Assistant General Counsel Florida Bar No. 0182117 3900 Commonwealth Blvd., MS 35 Tallahassee, Florida 32399-3000 Phone: (850) 245-2247 Fax: (850) 245-2301
TABLE OF CONTENTS TABLE OF CONTENTS...i TABLE OF CITATIONS...ii STATEMENT OF THE CASE... 1 SUMMARY OF THE ARGUMENT... 2 ARGUMENT... 3 I. THE THIRD DISTRICT S DECISION DOES NOT CONFLICT WITH THE ANDREWS OR STOCKTON DECISIONS... 5 A. Sarasota County v. Andrews... 5 B. Bank of South Palm Beaches v. Stockton... 7 II. THE THIRD DISTRICT S DECISION DOES NOT CONFLICT WITH THE BRANTLEY DECISION... 9 CONCLUSION... 10 CERTIFICATE OF SERVICE... 11 CERTIFICATE OF COMPLIANCE... 12 i
Cases TABLE OF CITATIONS Ansin v. Thurston, 101 So.2d 808 (Fla. 1958)...3 Bank of South Palm Beaches v. Stockton, Whatley, Davin and Company, 473 So.2d 1358 (Fla. 4th DCA 1985)... 7, 8 Bunkley v. State, 882 So.2d 890 (Fla. 2004)...2 First Nationwide Mortgage Corporation v. Brantley, 851 So.2d 885 (Fla. 4th DCA 2003)... 9, 10 In re M.P. v. Lake County, 472 So.2d 732 (Fla. 1985)...4 Jenkins v. State, 385 So.2d 1356 (Fla. 1980)...3 Kyle v. Kyle, 139 So.2d 885 (Fla. 1962)... 3, 4, 9 Penzell v. Department of EnvironmentalProtection, 915 So.2d 194 (Fla. 3d DCA 2005)... passim Reaves v. State, 485 So.2d 829 (Fla. 1986)...2 Sarasota County v. Andrews, 573 So.2d 113 (Fla. 2d DCA 1991)... 5, 6, 7 South Florida Hospital Corp. v. McCrea, 118 So.2d 25 (Fla. 1960)...4 Suntrust Bank v. Riverside Nat l Bank of Florida, 792 So.2d 1222 (Fla. 4th DCA 2001)...8 The Florida Star v. B.J.F., 530 So.2d 286, 288 (Fla. 1988)...3 Statutes and Other Authorities Article V, Section 3, Florida Constitution... passim Section 197.582, Fla. Stat. (2004)...1, 5, 7, 9 ii
Fla. R. App. P. 9.030(a)(2)(A)(iv)...3 Attorney General Opinion 91-64...2 iii
STATEMENT OF THE CASE This request for review arises from the decision rendered in Penzell v. M & M Construction Group Corp., 915 So.2d 194 (Fla. 3d DCA 2005)(attached as Appendix I). In that tax sale case, the Third District affirmed the trial court s determination of the priority afforded a final judgment held by the Department of Environmental Protection (the Department ) under section 197.582(2), Florida Statutes (establishing priorities for distribution of excess tax sale proceeds). The Penzell Court held that the Department s final judgment which, inter alia, (1) mandated environmental cleanup of the subject property, (2) authorized the Department to conduct the remedial activities itself (should the owner default), with the owner held liable for the cost, and (3) retained jurisdiction to enforce these provisions constituted a valid lien of record held by a governmental unit entitled to priority under section 197.582(2), Florida Statutes (establishing priorities for distribution of excess tax sale proceeds). On December 21, 2005, the Third District denied Petitioners Amended Motion for Rehearing, Clarification, and Certification and also denied their Amended Motion for Rehearing en Banc. Petitioners filed a Notice to Invoke the 1
Discretionary Jurisdiction of this Court on January 5, 2006, asserting that the Penzell decision conflicts with three other district court decisions. 1 SUMMARY OF THE ARGUMENT This Court lacks any constitutional basis to accept jurisdiction of this case. Contrary to Petitioners assertion, the Third District decision in Penzell does not expressly and directly conflict with any point of law announced in the three decisions cited by Petitioners. Therefore, under this Court s precedent, the Court s discretionary conflict jurisdiction under Article V, Section 3(b)(3) of the Florida Constitution is not implicated here. Therefore, Petitioners request for review should be denied. 1 Petitioners also suggest that the reasoning in Penzell is contrary to an opinion of the Florida Attorney General. See Pet. Br. at 4 (citing Op. Att y Gen. Fla. 91-64). However, the Penzell decision makes no mention of the Attorney General opinion cited by Petitioners, nor does such opinion provide a basis for asserting conflict jurisdiction. See Bunkley v. State, 882 So.2d 890, 897 (Fla. 2004) (rejecting attorney general opinion construing statutory exception, observing that opinions of the Attorney General are not statements of law ); see also Reaves v. State, 485 So.2d 829, 830 (Fla. 1986)(recognizing that conflict must appear within the four corners of the majority decision ); see generally Art. V, 3(b)(3), Fla. Const. (providing discretionary review based on express and direct conflict between decisions of different district courts, or between decisions of a district court and the Florida Supreme Court). 2
ARGUMENT In this case, the opinion below does not conflict with the decisions cited by Petitioners. The Supreme Court has discretionary jurisdiction to review any decision of a district court of appeal that... expressly and directly conflicts with a decision of another district court of appeal or of the supreme court on the same question of law. Art. V, 3(b)(3), Fla. Const. (emphasis added); Fla. R. App. P. 9.030(a)(2)(A)(iv). The Court s discretion to review a district court decision is narrowly circumscribed by the Florida Constitution in Article V, Section 3(b)(3). See The Florida Star v. B.J.F., 530 So.2d 286, 288 (Fla. 1988)(explaining that the Court s discretion to exercise jurisdiction is narrowly circumscribed); see also Jenkins v. State, 385 So.2d 1356 (Fla. 1980)(emphasizing that the Court s power to review district court decisions is limited and strictly prescribed and that district courts are courts primarily of final appellate jurisdiction )(quoting Ansin v. Thurston, 101 So.2d 808, 810 (Fla. 1958)). In construing this constitutional restriction, the Court has carefully limited the universe of cases that qualify for conflict jurisdiction review, explaining: The conflict must be such that if the later decision and the earlier decision were rendered by the same Court the former would have the effect of overruling the latter.... If the two cases are distinguishable in controlling factual elements or if the points of law settled by the two cases are not the same, then no conflict can arise. 3
Kyle v. Kyle, 139 So.2d 885, 887 (Fla. 1962)(internal citations omitted)(emphasis added); see also South Florida Hospital Corp. v. McCrea, 118 So.2d 25, 27 (Fla. 1960)(reflecting that the scope of review is extremely limited when conflict jurisdiction is asserted). Here, the Court does not have discretion to review the Third District s decision in Penzell because it does not establish a point of law contrary to any of the decisions cited by Petitioners. Indeed, the statute at issue in Penzell was not involved and played no part in the decisions cited by Petitioners. See In re M.P. v. Lake County, 472 So.2d 732, 733 (Fla. 1985)(declining review where the statute at issue in first decision was not at issue in later decision). Thus, the Penzell decision does not have the effect of overruling, or of creating conflict with, the decisions cited by Petitioners. Furthermore, the factual circumstances of the cases cited by Petitioners differ significantly from those of Penzell. Penzell arose in the context of a tax sale auction, with the priority of liens for purposes of distributing excess proceeds being established by statute. In contrast, two of the cases cited by Petitioners involved far different legal provisions (municipal ordinances, in fact) and all were decided in the context of common law foreclosure actions. Petitioners have failed to show that the Penzell decision creates any conflict with the decisions cited in Petitioners Brief on Jurisdiction. Because there is not 4
basis for this Court s discretionary review, Petitioners request for review must be denied. I. THE THIRD DISTRICT S DECISION DOES NOT CONFLICT WITH THE ANDREWS OR STOCKTON DECISIONS A. Sarasota County v. Andrews The point of law settled by the Third District in Penzell is a narrow one. Applying section 197.582(2), Florida Statutes, the Third District held that the judgment obtained by the Department, providing for environmental remediation of the subject property at the owner s expense, constitutes a lien of record held by a governmental unit and is thus entitled to priority for purposes of distributing excess tax sale proceeds. As stated by the Third District: Section 197.582(2), Florida Statutes (2004) establishes the manner in which excess proceeds from a tax sale must be distributed, and prioritizes the payment of any lien of record held by a governmental unit against the property. Penzell, 915 So.2d at 195 (quoting 197.582(2), Fla. Stat.). Sarasota County v. Andrews, 573 So.2d 113 (Fla. 4th DCA 1991) addressed an entirely different question of law, against a backdrop of significantly different facts. Specifically, the issue in Andrews was whether a county ordinance concerning priority of liens could be retroactively applied to render a preexisting recorded mortgage inferior to a subsequent county lien. Id. at 115. As explained 5
in Andrews, Mr. and Mrs. Andrews had obtained a mortgage on their property in 1983 from Coast Federal Savings and Loan Association ( Coast Federal ). Id. at 114. The following year, Sarasota County enacted an ordinance providing that a recorded certified copy of an order imposing a fine constitutes a lien against the land upon which the violation exists, and that such lien is superior to all other liens. Id. (explaining and quoting the ordinance at issue). Later, the Sarasota County Code Enforcement Board found the Andrews liable for operating an unpermitted landfill on their property, ordered them to pay a fine, and then recorded certified orders purporting to create a lien against the Andrews property. Id. When the County sought to foreclose its claim of lien, it relied on the 1984 ordinance to establish that its lien was superior to all others including the mortgage recorded by Coast Federal before the ordinance had been enacted. Id. The Andrews court held that, in a lien foreclosure action, the retroactive application of Sarasota County s ordinance to alter the priority of Coast Federal s preexisting mortgage was unconstitutional as applied under an impairment of contract theory. Id. at 115. The Penzell case, in contrast, arose in the context of a tax lien sale, where the liquidation of the Penzell mortgage was not occasioned by any lawsuit initiated by the Department to enforce its judgment. 6
The Penzell decision does not address the constitutional question raised in Andrews, and thus cannot even arguably be read to be in conflict with much less have the effect of overruling that opinion. Thus, contrary to Petitioners assertions, no conflict exists between the Andrews decision and the decision of the Third District in Penzell. B. Bank of South Palm Beaches v. Stockton Petitioners assertion that conflict exists between the Penzell decision and Bank of South Palm Beaches v. Stockton, 473 So.2d 1358, 1359 (Fla. 4th DCA), is equally without merit. The Stockton decision stands for the common law rule governing the priority of lien interests, which had no bearing in Penzell due to the applicability of section 197.582(2), Florida Statutes. The court in Stockton considered the lien priority of competing mortgages in a foreclosure action, and addressed the question of whether a court sitting in equity may disregard the common law first in time, first in right maxim in order to effect an equitable disposition. 473 So.2d at 1359. The appellant in that case Stockton, Whatley, Davin and Company ( Stockton ) issued a loan to Castle Builders construction company and properly recorded its interest. Id. When Castle Builders fell behind in its payments, it requested and obtained a second loan from Stockton in order to pay off the arrearage that had accumulated on the first. Id. During the time between issuance of the two loans, several additional creditors 7
properly recorded liens on the same property. Id. Although most agreed to subordinate their interests to the second Stockton loan, Stockton failed to obtain such an agreement from the Bank of South Palm Beaches ( Bank ). Id. Castle Builders defaulted on both of the Stockton loans, and foreclosure proceedings ensued. Id. In reversing the trial court s decision (which ruled that Stockton s subsequently recorded interest was superior to that of the Bank), the Stockton court held that a court sitting in equity does not have the power to disregard established law in order to reach a fair result. Id. at 1361. Subsequently, however, the Fourth District Court of Appeal held that its decision in Stockton and more specifically the inflexible rule that time of recording determines priority articulated therein was incorrect. See Suntrust Bank v. Riverside Nat l Bank of Florida, 792 So.2d 1222, 1226 (Fla. 4th DCA 2001), rev. denied 821 So.2d 300 (Fla. 2002). Contrary to Petitioner s assertions, Penzell does not conflict with the holding in Stockton, because the Penzell court did not address, much less disrupt the well established rule governing priority of lien interests in mortgage foreclosure actions. Pet. Br. at 4 (citations omitted). Rather, Penzell arose under a specific statutory scheme explicitly establishing the priority rule in cases involving distribution of excess tax sale proceeds. Where, as here, the points of law settled 8
by the two cases are not the same, then no conflict can arise. Kyle, 139 So.2d at 887. II. THE THIRD DISTRICT S DECISION DOES NOT CONFLICT WITH THE BRANTLEY DECISION As stated above, the opinion below held that the judgment obtained by the Department constitutes a lien of record held by a governmental unit and is thus entitled to priority for purposes of distributing excess tax sale proceeds pursuant to section 197.582(2), Florida Statutes. Petitioner contends that First Nationwide Mortgage Corp. v. Brantley, 851 So.2d 885 (Fla. 4th DCA 2003) which did not even involve application of section 197.582(2), Florida Statutes stands for the conflicting proposition that a governmental lien under section 197.582(2), Florida Statutes does not encompass a judgment or judgment lien. Pet. Br. at 6. Petitioner s reliance on the Brantley decision to demonstrate conflict is misplaced. First, like all of the decisions cited by Petitioners, the Brantley decision did not arise in the context of a tax sale, as did Penzell. In Brantley, the City of Fort Lauderdale sought to foreclose on a lien arising from a city loan issued to a property owner for home improvements. The City asserted that its lien was superior to that of a prior recorded mortgage on the basis of an ordinance, which provided: 9
Any municipal lien existing from the delivery of municipal services, including liens for special assessments, code endorsement [sic] and the like, shall be deemed to be prior in dignity to any other lien, including mortgages, irrespective of the date of the recording of the municipal lien or the date of the recording of any mortgage or any other lien on real property. Id. at 887 (citation omitted). Thus, in Brantley the issue addressed was whether a lien arising from a home improvement loan constituted a lien existing from the delivery of municipal services under this particular ordinance. Because the Penzell opinion construed an entirely different statutory provision, it cannot have the effect of overruling Brantley. CONCLUSION The Third District decision in Penzell does not expressly and directly conflict with any point of law announced in the three decisions cited by Petitioners. Rather, it arises in a context, and construes a statutory provision, not addressed in any of the decisions with which conflict is asserted. Therefore, this Court is precluded from exercising its discretion to review this case under Article V, Section 3(b)(3) of the Florida Constitution and the Court s controlling precedent interpreting that provision. For all of the foregoing reasons, the petition for review should be denied. 10
Respectfully submitted this 13th day of February, 2006. /s/ Aliki Moncrief Aliki Moncrief Senior Assistant General Counsel Florida Bar No. 0182117 3900 Commonwealth Blvd., MS 35 Tallahassee, FL 32399-3000 Telephone: (850) 245-2247 Attorney for Respondent, State of Florida Department of Environmental Protection CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing Answer Brief on Jurisdiction was furnished by first class U.S. Mail to Victor K. Rones, 16105 NE 18th Ave., N. Miami Beach, FL 33162, Attorney for Petitioners on this 13th day of February, 2006. /s/ Aliki Moncrief Aliki Moncrief Attorney for Respondent, State of Florida Department of Environmental Protection 11
CERTIFICATE OF COMPLIANCE I hereby certify that the foregoing Answer Brief on Jurisdiction is typed in Times New Roman, 14-point and complies in all respects with requirements of Fla. R. App. P. 9.210(a)(2). /s/ Aliki Moncrief Aliki Moncrief Attorney for Respondent, State of Florida Department of Environmental Protection 12