Date: 02-20-2019

Case Style:

Case Number: 3d17-938

Judge: Salter

Court: Florida Court of Appeals, 3rd District on appeal from the Circuit Court for Miami-Dade County

Plaintiff's Attorney: Alexander S. Orlofsky

Defendant's Attorney: W. Todd Boyd and Gissell Jorge

Description: Matt Papunen (“Buyer”) appeals a final order dismissing with prejudice his
complaint against Bay National Title Company (“Bay National”).1
The Buyer
alleged that although Bay National confirmed at closing Seller’s title and the absence
of post-foreclosure appellate or other legal challenges to the Seller’s title, Bay
National’s title examination negligently missed a post-judgment, duly-docketed
motion to vacate the foreclosure judgment and challenge the Seller’s title.
We reverse the order of dismissal with prejudice, and remand for further
proceedings.
Facts and Proceedings Below
The case below arises from the sale of a residence by a lender following the
foreclosure of a mortgage on the residence and the issuance of a certificate of title
to the lender. The lender, through its attorney-in-fact JPMorgan Chase Bank,
National Association (“Seller”), then placed the property for sale.
The Buyer and Seller entered into an “Indemnity and Hold Harmless Release”
(the “Release”) signed and notarized by Buyer on June 19, 2015. The form
identified as “Seller Releasees” the Seller, Bay National, their respective “parent and

1
Inexplicably, the Buyer’s notice of appeal from the final order identifies the title
insurer, Fidelity National Title Insurance Company, as the defendant/appellee, rather
than the title agent, Bay National Title Company. Bay National Title Company was
the sole defendant below, the party identified in the final order itself, and the
“authorized signatory” shown on the title insurance forms at issue. The appellee’s
brief identifies the defendant/appellee variously as “Bay National Title Insurance
Company” and “Bay National Title Company.”
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subsidiary and affiliate companies,” and the “present and former officers, directors,
agents, employees, stockholders, owners, members, managers, attorneys,
predecessors, successors, assigns, insurers and servicing agents of each such entity.”
The recitals, disclosures, and terms of the Release identified various risks:
“the Property may have Occupants or Claimants occupying the Property,” and there
might be agreements or rent concessions relating to any such Occupant or Claimant.
The Release also addresses the possibility of rent control violations, unrecorded
prepaid rent, or security deposits with tenants that might not be transferred as part
of the sale. Finally, the Release addresses the condition of the property being sold,
with the Seller disclaiming liability for damages that might be caused by repairs or
alterations to the property by an occupant prior to the closing.
Other provisions of the Release pertain to post-closing claims of the former
owner:
WHEREAS . . . The delivery of possession shall be subject to the rights
of any Occupants or Claimants and any right of confirmation,
redemption or similar legal right of the former owner, its successors and
assigns. Seller shall not be required to bring any action to evict,
relocate, dispossess or determine the rights of any Occupant or
Claimant before, on or after closing. The existence of any Occupants or
Claimants, or claims by such persons, shall not give right to any rights
to terminate the Agreement by Buyer or to give Buyer the right to raise
any objection to Seller’s title.
….
In consideration of Seller’s agreement to proceed with the closing of
the sale of the Property to Buyer, and Closing Agent’s agreement to
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conduct the Closing of the sale of the Property notwithstanding the
aforementioned items, Buyer hereby agrees as follows:
….
2. Buyer agrees to release, indemnify, defend, and forever hold the
Seller Releasees harmless in all respects from and against any manner
of action, cause of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bill, specialties, covenants, contracts, controversies,
agreements, promises, variances, trespasses, interest, penalties,
damages, judgments, executions, claims and demands whatsoever, in
law or in equity, arising out of, in connection with or relating to the
occupancy of the property or the sale of the Property to Buyer.
….
4. It is the intent of Buyer, and Seller that this Release survive any
closing of the sale of the Property to Buyer.
A week after the Release was executed and delivered, the Buyer and the Seller
entered into a standard form of “‛As Is’ Residential Contract for Sale and Purchase”
(the “Contract”). Although Bay National was a designated “Seller Releasee” in the
Release executed by the Seller and Buyer a week earlier, the Contract specified that
the Seller would deliver and pay for an owner’s title policy to be issued to the Buyer
“insuring Buyer’s marketable title to the Real Property,” subject only to six types of
exceptions typical in such transactions, including land use matters, plat restrictions,
mineral rights of record, unplatted public utility easements of record, taxes for the
year of closing and subsequent years, and assumed and purchase money mortgages.
The Contract provisions did not include an exception for certain docketed filings in
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the foreclosure case: a notice of appeal, or a motion to vacate or set aside the final
judgment and foreclosure sale through which the Seller had obtained title.
The Seller and Buyer closed the sale transaction on July 24, 2015. In
conformance with the terms of the Contract, the Seller and Bay National delivered
a markup of an earlier title insurance commitment issued and signed by Bay
National. Bay National marked up Schedule B, Section 1, of the commitment to
confirm that requirement 10 had been satisfied:
Issuing agent must request from the [insurer, Fidelity National Title
Insurance Company] (or perform themselves) an update and review of
the foreclosure docket for the proceeding [identifying the foreclosure
case in which the Seller obtained title] between the effective date of this
report and one (1) business day prior to closing, to verify that no appeal
or motion to vacate or set aside the proceedings has been filed.
In its complaint, the Buyer alleged that Bay National negligently failed to
perform the specified “update and review of the foreclosure docket,” and failed to
discover a motion to vacate the final judgment of foreclosure. The Buyer alleged
that he incurred substantial damages over a protracted period as he prosecuted legal
proceedings to overcome the motion to vacate.
Bay National moved to dismiss on the basis of the broad language in the
Release.2
The Buyer contended that the insurance commitment delivered at closing

2
The Release, Contract, title commitment, and marked-up commitment delivered
to the Buyer at closing were attachments to the Complaint, and were thus within the
“four corners rule.” Jester v. Pawley, 245 So. 3d 859, 860 (Fla. 3d DCA 2018).
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pursuant to the terms of the Contract (and over a month after the Release was
executed) imposed a separate duty on the part of Bay National that was outside the
scope of the general exculpatory provisions in the Release. The Buyer argued that
Bay National’s argument rendered the Contract provisions regarding title, and the
title commitment itself, entirely nugatory—a result that could not have been
intended.
The trial court heard argument on the motion to dismiss and the Buyer’s
opposition to the motion, and granted the motion to dismiss, declining to allow the
Buyer a right to amend. This appeal followed.
Analysis
We review an order granting a motion to dismiss with prejudice de novo.
Williams Island Ventures, LLC v. de la Mora, 246 So. 3d 471, 475 (Fla. 3d DCA
2018). “In determining the merits of a motion to dismiss, the trial court must limit
itself to the four corners of the complaint, including any attached or incorporated
exhibits, assuming the allegations in the complaint to be true and construing all
reasonable inferences therefrom in favor of the non-moving party.” Grove Isle
Ass’n, Inc. v. Grove Isle Assocs., LLLP, 137 So. 3d 1081, 1089 (Fla. 3d DCA 2014).
The sweeping exculpatory language within the earlier release is facially
inconsistent with the more specific title insurance obligations of the Seller in the
later Contract and marked-up title commitment delivered to the Buyer in accordance
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with the Contract. “[I]t is a general principle of contract interpretation that a specific
provision dealing with a particular subject will control over a different provision
dealing only generally with that same subject.” Kel Homes, LLC v. Burris, 933 So.
2d 699, 703 (Fla. 2d DCA 2006) (quoted with approval in Idearc Media Corp. v.
M.R. Friedman and G.A. Friedman, P.A., 985 So. 2d 1159, 1161 (Fla. 3d DCA
2008)).
The Buyer is correct that Bay National’s and the trial court’s interpretation of
the documents simply nullifies the contract provisions requiring the Seller to provide
title insurance and to complete a review of the foreclosure docket. The Seller’s
Release document is plainly written for the protection of the Seller, while Bay
National’s title duties are just as plainly written for the protection of the Buyer. The
reconciliation of these provisions leads ineluctably to the conclusion that the motion
to dismiss should not have been granted with prejudice.
That said, Bay National has also cited provisions of the title commitment and
various federal cases3
holding that the Buyer’s claims must be confined exclusively
to contract rather than tort. We decline to consider or rule upon that argument, but
the point underscores that the right to amendment should not have been prohibited

3
These authorities were not cited to the trial court in Bay National’s motion to
dismiss.
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so quickly (the Seller had never amended its original complaint when it was
precluded from filing even a first amended complaint).
Leave of court to amend “shall be given freely when justice so requires,”
Florida Rule of Civil Procedure 1.190(a), and “any doubts should be resolved in
favor of the amendment.” Overnight Success Const., Inc. v. Pavarini Const. Co.,
Inc., 955 So. 2d 658, 659 (Fla. 3d DCA 2007).

Outcome: The final order of dismissal with prejudice is reversed, and the action is
remanded to the circuit court for further proceedings.

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Defendant's Experts:

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