Wells Fargo Sought to Vacate a Judgment in Their Favor

Posted on: July 1, 2013

Wells Fargo Bank, N.A. v. Giglio, No. 4D12-418 (Fla. 4th DCA 2013):

Wells Fargo sought reversal of the trial court’s order denying its requests to: (1) approve a dismissal of the case; (2) set aside the previously entered final judgment; (3) cancel the notice of lis pendens; and (4) direct the clerk to return the original loan documents upon which the foreclosure action was based. Wells Fargo made these requests because the defendant in the foreclosure action delivered funds sufficient to reinstate the mortgage. Wells Fargo accepted the funds and the need of a foreclosure sale or further litigation unnecessary. Although the foreclosure sale took place, it was vacated by the trial court at Wells Fargo’s request.

Florida’s public policy highly favors settlement agreements among parties and will enforce them whenever possible. Sun Microsystems of Cal., Inc. v. Eng’g and Mfg. Sys., C.A., 682 So.2d 219 (Fla. 3rd DCA 1996). Here, the defendant cured his default and the parties settled their dispute. Wells Fargo relied upon Florida Statute §702.07 and Florida Rule of Civil Procedure 1.540 for relief. Typically, relief from judgment is sought by the party against whom the judgment is entered, not the beneficiary of the judgment. Nothing in the rule suggests Wells Fargo lacked an ability to seek vacatur of a judgment it received.

The trial court concluded that: (1) Wells Fargo’s motion failed to allege sufficient grounds under Rule 1.540; (2) the clerk could not return the original note because it was cancelled and incorporated into the final judgment; and (3) that as a result of the final judgment, request for dismissal was moot. A final judgment and lis pendens remained of record even though the mortgage had been reinstated, and Wells Fargo was denied possession of its original loan documents, thereby impeding its ability to seek relief in the event of a further default.

The Fourth District Court of Appeal held that the trial court abused its discretion in refusing to grant the related collateral relief requested by Wells Fargo, which refusal prevented the parties from concluding their settlement. The trial court’s order was reversed to the extent it denied Wells Fargo’s requested relief. The matter was further remanded with instructions that the trial court enter such orders necessary to effectuate the parties’ settlement including an order which: (1) vacates the final judgment; (2) directs the clerk to return all original loan documents to Wells Fargo; (3) cancels the lis pendens; and (4) dismisses the case without prejudice.