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A recent decision by a Florida court has changed how foreclosure law firms can bill for serving defendants labeled as “unknowns,” such as the unknown spouse of a homeowner or an unknown tenant living on the property.
The case challenges a common practice in Florida where foreclosure firms add charges for separate summonses issued to “John Doe,” “Jane Doe,” or any unknown person who might have an interest in the home.
Fleysher Law Bankruptcy & Debt Attorneys helps homeowners understand how foreclosure paperwork, fees, and court decisions can affect their case. If you're facing a lawsuit from your lender or bank, you need to know your rights, especially when firms try to collect payment for unnecessary or excessive legal actions. This ruling may reduce how much homeowners owe in court costs and could set the stage for more transparency and fairness in Florida's foreclosure system.
The issue came to light after a Palm Beach County judge reviewed a foreclosure lawsuit where a law firm charged for multiple summonses served to “unknown parties,” including an unknown tenant and unknown spouse.
The firm attempted to collect payment from the borrower for serving each of these defendants, even though no evidence showed these people actually existed. The judge questioned whether this practice had a proper legal basis under state law and if it unfairly inflated foreclosure costs.
In Florida, a lender must serve foreclosure paperwork to anyone who might have a claim to the property. This includes not only the borrower, but also junior lienholders, mortgage lenders, or others with a security interest.
The documents include the complaint, summons, and other necessary paperwork. But some firms go further and serve additional summonses to hypothetical parties to “ensure clear title.”
These “unknowns” are added to protect the plaintiff from future claims by someone who wasn’t part of the original suit. While this is meant to reduce legal risk, some law firms have turned it into a way to bill for extra forms, documents, and services that may not be needed in every case.
“Unknown parties” typically include names like “John and Jane Doe,” “unknown spouse,” or “unknown tenant.” These placeholders are used in a lawsuit when the plaintiff is unsure whether any other person has a legal claim to the property being foreclosed.
It’s become a common practice to include unknown parties in a foreclosure lawsuit to avoid delays if someone later claims interest in the property. By serving them up front, banks and law firms aim to ensure clear title after the sale.
Firms often use separate summonses and sometimes post the documents publicly or use process servers. But these steps cost money. Until now, courts rarely questioned if this method was being abused or if it complied with the Florida Consumer Collection Practices and the Florida Deceptive and Unfair Trade Practices Act.
The circuit judge ruled that foreclosure firms cannot charge homeowners for serving summonses to parties that don’t exist. Specifically, the court found no justification under state law for charging separate fees to serve fictitious names like “Jane Doe” or “unknown tenant” when there’s no actual evidence of another occupant.
The judge cited the Florida Deceptive and Unfair Trade Practices Act as part of the reasoning. The court stated that billing homeowners for additional summonses without a legal need is misleading and may qualify as foreclosure fraud. It also raised concerns about inflated legal bills and unfair practices by firms seeking to collect payment from already struggling homeowners.
What drew the court’s focus was the blanket use of summonses without checking if there was an unknown tenant, unknown spouse, or any other person at the property. In some cases, these charges were hundreds of dollars for forms that never reached a real entity or individual. The court found this both excessive and lacking a clear legal basis.
1. Change in Billing Practices
After the ruling, foreclosure law firms across Florida may need to revise their billing procedures. Charging for separate summonses will now require clear proof that the summons was necessary and tied to a real party with a valid interest in the property.
2. Limits on Recoverable Legal Fees
Firms will no longer be able to pass all legal costs onto the borrower, especially when those costs are tied to unnecessary or improper actions. This ruling may limit how much attorneys can recover in fees, especially in default cases where there’s no challenge to the mortgage.
3. Ethical and Procedural Implications
The decision raises ethical concerns and may push law firms to adopt stricter compliance procedures. The court implied that failure to change may lead to claims of fraud, violations of state law, or even complaints filed with the Attorney General’s Office.
Several foreclosure defense attorneys praised the decision. They called it a step toward protecting homeowners from predatory billing. Many said that for years, law firms added fees without proper justification, making it harder for people to settle or save their homes.
On the other hand, some law firms argue the ruling limits their ability to protect their clients' security interest in the property. They claim that naming unknown parties has long been accepted as a safeguard, and worry this may increase risks after foreclosure sales.
The ruling may face an appeal or result in further clarification from higher courts. Some experts believe it could lead to new case law or even action by the state legislature to more clearly define who can be named, served, and billed during foreclosure cases.
Encouraging Fair Billing Practices: The case encourages law firms to charge fairly and avoid tacking on legal fees without a solid legal basis. This may influence how all forms and documents are used in future foreclosure cases.
Setting a Precedent for Other States: Though this decision is specific to Florida, it may influence how other courts address similar billing practices in foreclosure actions. States with similar consumer protection laws could follow this example.
Could Lead to Legislative Reforms: The outcome could spark new rules from lawmakers. There may be efforts to amend the Florida Deceptive and Unfair Trade Practices Act, clarifying limits on who can be served and how much firms can charge for doing so.
1. Can a foreclosure law firm sue me if I miss payments?
Yes. If you fall behind on your mortgage loan, the lender has the right to sue you to recover the money owed. Once that happens, the firm handling the case will file a lawsuit in court and serve a notice to begin the foreclosure process. This is why it’s important to respond quickly, even if you just received your first late notice within the last week.
2. What is a promissory note and how does it relate to my foreclosure case?
A promissory note is the legal document you signed when you took out your mortgage loan, promising to pay back the lender. It is different from the mortgage itself, but both are required for the bank to foreclose. Without a valid promissory note, the lender might not have a strong case to take your home.
3. Will foreclosure hurt my credit?
Yes. A foreclosure will damage your credit and stay on your credit report for several years. It may lower your credit score significantly and make it harder to buy another home or apply for new credit cards or loans.
4. How much time do I have to respond once I’m served?
In Florida, you usually have 20 calendar days from the date the notice is served to respond to a foreclosure complaint. That’s less than three weeks, so it's important to speak with an attorney right away to protect your rights.
5. Do I still have to pay if the property goes into foreclosure?
Yes. Even if the foreclosure process has started, you are still responsible to pay your mortgage loan until the home is sold or the court finalizes the case. In some cases, you may still owe money after the sale, especially if the home sells for less than what you owe on the promissory note.
If you’re dealing with foreclosure and feel overwhelmed by legal fees, court papers, or unfamiliar names on your documents, you’re not alone. Many homeowners don’t realize they can challenge unfair charges or question what’s in their foreclosure paperwork. That’s where we come in.
Fleysher Law Bankruptcy & Debt Attorneys helps people understand their rights and fight back against improper billing and unfair court actions. Our legal team reviews your summonses, forms, documents, and all fees added to your case. We look for errors, inflated costs, or anything that violates the Florida Deceptive and Unfair Trade Practices Act or the Florida Consumer Collection Practices rules.
If there’s a way to lower what you owe, or stop the process entirely, we’ll find it. Call us today for a free consultation with a Florida attorney who puts your rights first and works to protect your home and your future.
Emil specializes in consumer bankruptcy, debt settlement, and mortgage modification, offering a holistic approach to solving mortgage and debt problems. Emil listens to clients, understands their circumstances and goals, and helps them make the right choices by presenting all options and contingencies.
He is dedicated to helping South Floridians regain their financial freedom from overwhelming debt caused by high interest credit cards, bad mortgage loans, and uninsured medical expenses.
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