- 29 May
District Court Ruling Sets Plain Language for Time Available on Lien Foreclosure
A new District Court of Appeal ruling has clarified the statute of limitations regarding companies foreclosing on municipal liens, when differing laws may exist. The rule clarification came when the company Riviera Beach tried to collect on real estate that belonged to J&B Motel Corp. The lien was first recorded in 2003 but no attempt was made to file for foreclosure until 2015. J&B Motel tried to dismiss the filing, pointing to sections of Florida law that had the statute of limitations set at four or five years. J&B originally won the argument when a circuit judge dismissed the lien, but a state appellate court reversed the decision and stated that the city had a limit of 20 years to follow through on the lien.
This ruling superseded the the original laws cited by J&B. The case established plain language stating that “a local government has 20 years from the date a code enforcement lien is recorded to file a lawsuit seeking to foreclose or recover a money judgment on the lien.” It was also decided that this limitation governs over a more general limitation that may be previously established. The decision regarding the ruling was unanimous and the state appellate court revived the suit after ruling in favor of the city.
Supreme Court Decision Rules on Statute of Limitations Violations in Bankruptcy Lawsuits
A recent divided Supreme Court decision has ruled that debt collectors are able to, in the course of bankruptcy proceedings, attempt to collect on property and assets that have exceeded their statute of limitations. In a 5-3 vote, the Supreme Court said that bankruptcy companies seeking these kinds of lawsuits are not violating the U.S. Fair Debt Collection Practices Act.
Critics of the decision say that bankruptcy debt collectors file many of these claims in the hopes that a small number of those affected do not object to the seizure of outdated debt. The original suit stemmed from a case involving a company named Midland Funding and Aleida Johnson. Johnson, the debtor, sued against Midland Funding after a judge threw out a lawsuit involving $1,900 in credit-card debt.
The Supreme court stated that even though the filing by Midland stated that the limitations period had run out, it did not specifically fall under any of the restrictions found in the Fair Debt Collection Practices Act.
The three judges who opposed the decision filed a dissenting opinion which stated that bankruptcy debt collectors are filing lawsuits involving outdated debt in bad faith, in the hopes of collecting payment from those unaware that the debt is too old to be taken up by the court system.
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