| 1 | A bill to be entitled |
| 2 | An act relating to timeshares; amending s. 721.07, F.S.; |
| 3 | providing lien disclosure requirements for filed public |
| 4 | offering statements for certain timeshare plans; amending |
| 5 | s. 721.16, F.S.; authorizing a managing entity to bring |
| 6 | judicial and nonjudicial actions to foreclose certain |
| 7 | liens under specified conditions; renaming part III of |
| 8 | chapter 721, F.S.; amending s. 721.81, F.S.; revising and |
| 9 | providing legislative purposes of the part; amending s. |
| 10 | 721.82 F.S.; revising and providing definitions; amending |
| 11 | s. 721.83, F.S.; revising application to apply to judicial |
| 12 | foreclosure actions; amending s. 721.85, F.S.; conforming |
| 13 | provisions to changes made by this act; creating s. |
| 14 | 721.855, F.S.; establishing procedure for the nonjudicial |
| 15 | foreclosure of assessment liens; providing for the |
| 16 | appointment of a trustee; providing recording requirements |
| 17 | for such liens; providing procedures for the initiation of |
| 18 | a nonjudicial foreclosure procedure against a timeshare |
| 19 | interest; providing procedures for an obligor's objection |
| 20 | to the nonjudicial foreclosure procedure; providing |
| 21 | conditions to a trustee's exercise of power of sale; |
| 22 | providing requirements for a notice of default and intent |
| 23 | to sell; providing requirements for a notice of sale; |
| 24 | providing requirements for a trustee's certificate of |
| 25 | compliance; providing requirements for the sale by auction |
| 26 | of foreclosed encumbered timeshare interests; providing |
| 27 | for the effect of a trustee's sale; providing requirements |
| 28 | for a trustee's deed; providing for the disposition of |
| 29 | proceeds of the sale; providing that the nonjudicial |
| 30 | foreclosure procedure does not impair or otherwise affect |
| 31 | the right to bring certain actions; providing application; |
| 32 | providing for actions for failure to follow the |
| 33 | nonjudicial foreclosure procedure; creating s. 721.856, |
| 34 | F.S.; establishing procedure for the nonjudicial |
| 35 | foreclosure of mortgage liens; providing for the |
| 36 | appointment of a trustee; providing recording requirements |
| 37 | for such liens; providing procedures for the initiation of |
| 38 | a nonjudicial foreclosure procedure against a timeshare |
| 39 | interest; providing procedures for an obligor's objection |
| 40 | to the nonjudicial foreclosure procedure; providing |
| 41 | conditions to a trustee's exercise of power of sale; |
| 42 | providing requirements for a notice of default and intent |
| 43 | to sell; providing requirements for a notice of sale; |
| 44 | providing requirements for a trustee's certificate of |
| 45 | compliance; providing requirements for the sale by auction |
| 46 | of foreclosed encumbered timeshare interests; providing |
| 47 | for the effect of a trustee's sale; providing requirements |
| 48 | for a trustee's deed; providing for the disposition of |
| 49 | proceeds of the sale; providing that the nonjudicial |
| 50 | foreclosure procedure does not impair or otherwise affect |
| 51 | the right to bring certain actions; providing for actions |
| 52 | for failure to follow the nonjudicial foreclosure |
| 53 | procedure; amending s. 721.86, F.S.; providing for |
| 54 | priority of application in case of conflict; providing an |
| 55 | effective date. |
| 56 |
|
| 57 | Be It Enacted by the Legislature of the State of Florida: |
| 58 |
|
| 59 | Section 1. Paragraph (jj) is added to subsection (5) of |
| 60 | section 721.07, Florida Statutes, to read: |
| 61 | 721.07 Public offering statement.-Prior to offering any |
| 62 | timeshare plan, the developer must submit a filed public |
| 63 | offering statement to the division for approval as prescribed by |
| 64 | s. 721.03, s. 721.55, or this section. Until the division |
| 65 | approves such filing, any contract regarding the sale of that |
| 66 | timeshare plan is subject to cancellation by the purchaser |
| 67 | pursuant to s. 721.10. |
| 68 | (5) Every filed public offering statement for a timeshare |
| 69 | plan which is not a multisite timeshare plan shall contain the |
| 70 | information required by this subsection. The division is |
| 71 | authorized to provide by rule the method by which a developer |
| 72 | must provide such information to the division. |
| 73 | (jj) The following statement in conspicuous type: |
| 74 | |
| 75 | The managing entity has a lien against each timeshare |
| 76 | interest to secure the payment of regular or special |
| 77 | assessments and ad valorem taxes. Your failure to make |
| 78 | any required payments may result in the judicial or |
| 79 | nonjudicial foreclosure of an assessment lien and the |
| 80 | loss of your timeshare interest. If the managing |
| 81 | entity initiates a nonjudicial procedure, you shall |
| 82 | have the option to object to the use of the |
| 83 | nonjudicial foreclosure procedure and the managing |
| 84 | entity may only proceed by filing a judicial |
| 85 | foreclosure action. |
| 86 |
|
| 87 | Section 2. Subsection (2) of section 721.16, Florida |
| 88 | Statutes, is amended to read: |
| 89 | 721.16 Liens for overdue assessments; liens for labor |
| 90 | performed on, or materials furnished to, a timeshare unit.- |
| 91 | (2) The managing entity may bring a judicial an action in |
| 92 | its name to foreclose a lien under subsection (1) in the manner |
| 93 | a mortgage of real property is foreclosed and may also bring an |
| 94 | action to recover a money judgment for the unpaid assessments |
| 95 | without waiving any claim of lien. As an alternative to |
| 96 | initiating a judicial action, the managing entity may initiate a |
| 97 | nonjudicial procedure to foreclose an assessment lien under s. |
| 98 | 721.855. |
| 99 | Section 3. Part III of chapter 721, Florida Statutes, |
| 100 | entitled "Foreclosure of Liens on Timeshare Estates," is renamed |
| 101 | "Foreclosure of Liens on Timeshare Interests." |
| 102 | Section 4. Section 721.81, Florida Statutes, is amended to |
| 103 | read: |
| 104 | 721.81 Legislative purpose.-The purposes of this part are |
| 105 | to: |
| 106 | (1) Recognize that timeshare interests estates are parcels |
| 107 | of real property used for vacation experience rather than for |
| 108 | homestead or investment purposes and that there are numerous |
| 109 | timeshare interests estates in this the state. |
| 110 | (2) Recognize that the economic health and efficient |
| 111 | operation of the vacation ownership industry are in part |
| 112 | dependent upon the availability of an efficient and economical |
| 113 | process for all timeshare interest foreclosures foreclosure. |
| 114 | (3) Recognize the need to assist both owners' associations |
| 115 | and mortgagees by simplifying and expediting the process for the |
| 116 | judicial and nonjudicial of foreclosure of assessment liens and |
| 117 | mortgage liens against timeshare interests estates. |
| 118 | (4) Improve judicial economy and reduce court congestion |
| 119 | and the cost to taxpayers by establishing streamlined procedures |
| 120 | for the judicial and nonjudicial foreclosure of assessment liens |
| 121 | and mortgage liens against timeshare interests estates. |
| 122 | (5) Recognize that nearly all timeshare interest |
| 123 | foreclosures are uncontested. |
| 124 | (6) Protect the ability of consumers who own timeshare |
| 125 | interests located in this state to choose a judicial proceeding |
| 126 | for the foreclosure of an assessment lien or a mortgage lien |
| 127 | against their timeshare interest. |
| 128 | (7) Recognize that the use of the nonjudicial foreclosure |
| 129 | procedure established by ss. 721.855 and 721.856 shall have the |
| 130 | same force and effect as the use of the judicial foreclosure |
| 131 | procedure against a timeshare interest with respect to the |
| 132 | provisions of this chapter or any other applicable law. However, |
| 133 | obligors shall not be subject to a deficiency judgment even if |
| 134 | the proceeds from the sale of the timeshare interest are |
| 135 | insufficient to offset the amounts secured by the lien. |
| 136 | Section 5. Section 721.82, Florida Statutes, is amended to |
| 137 | read: |
| 138 | 721.82 Definitions.-As used in this part, the term: |
| 139 | (1) "Amounts secured by the lien" means all amounts |
| 140 | secured by an assessment lien or mortgage lien, including, but |
| 141 | not limited to, all past due amounts, accrued interest, late |
| 142 | fees, taxes, advances for the payment of taxes, insurance and |
| 143 | maintenance of the timeshare interest, and any fees or costs |
| 144 | incurred by the lienholder or trustee, including any reasonable |
| 145 | attorney's fees, trustee's fees, and costs incurred in |
| 146 | connection with the default. |
| 147 | (2)(1) "Assessment lien" means: |
| 148 | (a) A lien for delinquent assessments as provided in ss. |
| 149 | 721.16, 718.116, and 719.108, and 721.16 as to timeshare |
| 150 | condominiums; or |
| 151 | (b) A lien for unpaid taxes and special assessments as |
| 152 | provided in s. 192.037(8). |
| 153 | (3)(2) "Junior interestholder" means any person who has a |
| 154 | lien or interest of record against a timeshare interest estate |
| 155 | in the county or counties in which the timeshare interest estate |
| 156 | is located, which is inferior to the mortgage lien or assessment |
| 157 | lien being foreclosed under this part. |
| 158 | (4)(3) "Lienholder" means a holder of an assessment lien |
| 159 | or a holder of a mortgage lien, as applicable. A receiver |
| 160 | appointed under s. 721.26 is a lienholder for purposes of |
| 161 | foreclosure of assessment liens under this part. |
| 162 | (5)(4) "Mortgage" has the same meaning set forth in s. |
| 163 | 697.01. |
| 164 | (6)(5) "Mortgage lien" means a security interest in a |
| 165 | timeshare interest estate created by a mortgage encumbering the |
| 166 | timeshare interest estate. |
| 167 | (7)(6) "Mortgagee" means a person holding a mortgage lien. |
| 168 | (8)(7) "Mortgagor" means a person granting a mortgage lien |
| 169 | or a person who has assumed the obligation secured by a mortgage |
| 170 | lien. |
| 171 | (9)(8) "Notice address" means: |
| 172 | (a) As to an assessment lien, the address of the current |
| 173 | owner of a timeshare interest estate as reflected by the books |
| 174 | and records of the timeshare plan under ss. 721.13(4) and |
| 175 | 721.15(7). |
| 176 | (b) As to a mortgage lien: |
| 177 | 1. The address of the mortgagor as set forth in the |
| 178 | mortgage, the promissory note or a separate document executed by |
| 179 | the mortgagor at the time the mortgage lien was created, or the |
| 180 | most current address of the mortgagor according to the records |
| 181 | of the mortgagee; and |
| 182 | 2. If the current owner of the timeshare interest estate |
| 183 | is different from the mortgagor, the address of the current |
| 184 | owner of the timeshare interest estate as reflected by the books |
| 185 | and records of the mortgagee. |
| 186 | (c) As to a junior interestholder, the address as set |
| 187 | forth in the recorded instrument creating the junior lien |
| 188 | interest or interest lien, or in any recorded amendment |
| 189 | supplement thereto changing the address, or in any written |
| 190 | notification by the junior interestholder to the foreclosing |
| 191 | lienholder changing the of such change in address. |
| 192 | (10)(9) "Obligor" means the mortgagor, the person subject |
| 193 | to an assessment lien, or the record owner of the timeshare |
| 194 | interest estate. |
| 195 | (11) "Permitted delivery service" means any nationally |
| 196 | recognized common carrier delivery service or international |
| 197 | airmail service requiring a signed return receipt. |
| 198 | (12)(10) "Registered agent" means an agent duly appointed |
| 199 | by the obligor under s. 721.84 for the purpose of accepting all |
| 200 | notices and service of process under this part. A registered |
| 201 | agent may be an individual resident in this state whose business |
| 202 | office qualifies as a registered office, or a domestic or |
| 203 | foreign corporation or a not-for-profit corporation as defined |
| 204 | in chapter 617 authorized to transact business or to conduct its |
| 205 | affairs in this state, whose business office qualifies as a |
| 206 | registered office. A registered agent for any obligor may not be |
| 207 | the lienholder or the attorney for the lienholder. |
| 208 | (13)(11) "Registered office" means the street address of |
| 209 | the business office of the registered agent appointed under s. |
| 210 | 721.84, located in this state. |
| 211 | (14) "Trustee" means an attorney who is a member in good |
| 212 | standing of The Florida Bar or his or her law firm, or a title |
| 213 | insurer authorized to transact business in this state under s. |
| 214 | 624.401, appointed as trustee or as substitute trustee in |
| 215 | accordance with s. 721.855 or s. 721.856. A receiver appointed |
| 216 | under s. 721.26 may act as a trustee under s. 721.855. A trustee |
| 217 | must be independent as required by s. 721.05(20). |
| 218 | Section 6. Section 721.83, Florida Statutes, is amended to |
| 219 | read: |
| 220 | 721.83 Consolidation of judicial foreclosure actions.- |
| 221 | (1) A complaint in a foreclosure proceeding involving |
| 222 | timeshare interests estates may join in the same action multiple |
| 223 | defendant obligors and junior interestholders of separate |
| 224 | timeshare interests estates, provided: |
| 225 | (a) The foreclosure proceeding involves a single timeshare |
| 226 | property. |
| 227 | (b) The foreclosure proceeding is filed by a single |
| 228 | plaintiff. |
| 229 | (c) The default and remedy provisions in the written |
| 230 | instruments on which the foreclosure proceeding is based are |
| 231 | substantially the same for each defendant. |
| 232 | (d) The nature of the defaults alleged is the same for |
| 233 | each defendant. |
| 234 | (e) No more than 15 timeshare interests estates, without |
| 235 | regard to the number of defendants, are joined within the same |
| 236 | consolidated foreclosure action. |
| 237 | (2) In any foreclosure proceeding involving multiple |
| 238 | defendants filed under subsection (1), the court shall sever for |
| 239 | separate trial any count of the complaint in which a defense or |
| 240 | counterclaim is timely raised by a defendant. |
| 241 | (3) A consolidated timeshare foreclosure action shall be |
| 242 | considered a single action, suit, or proceeding for the payment |
| 243 | of filing fees and service charges pursuant to general law. In |
| 244 | addition to the payment of such filing fees and service charges, |
| 245 | an additional filing fee of up to $10 for each timeshare |
| 246 | interest estate joined in that action shall be paid to the clerk |
| 247 | of court. |
| 248 | Section 7. Section 721.85, Florida Statutes, is amended to |
| 249 | read: |
| 250 | 721.85 Service to notice address or on registered agent.- |
| 251 | (1) Service of process for a foreclosure proceeding |
| 252 | involving a timeshare interest estate may be made by any means |
| 253 | recognized by law. In addition, substituted service on an |
| 254 | obligor a party who has appointed a registered agent under s. |
| 255 | 721.84 may be made on such registered agent at the registered |
| 256 | office. Also, when using s. 48.194 where in rem or quasi in rem |
| 257 | relief only is sought, such service of process provisions are |
| 258 | modified in connection with a foreclosure proceeding against a |
| 259 | timeshare interest estate to provide that: |
| 260 | (a) Such service of process may be made on any person |
| 261 | whether the person is located inside or outside this state, by |
| 262 | certified or registered mail, return receipt requested, or by a |
| 263 | permitted delivery service, return receipt requested, addressed |
| 264 | to the person to be served at the notice address, or on the |
| 265 | person's party's registered agent duly appointed under s. |
| 266 | 721.84, at the registered office; and |
| 267 | (b) Service shall be considered obtained upon the signing |
| 268 | of the return receipt by any person at the notice address, or by |
| 269 | the registered agent. |
| 270 | (2) The current owner and the mortgagor of a timeshare |
| 271 | interest estate must promptly notify the owners' association and |
| 272 | the mortgagee of any change of address. |
| 273 | (3) Substituted notice under s. 721.855 or s. 721.856 for |
| 274 | any party who has appointed a registered agent under s. 721.84 |
| 275 | may be made on such registered agent at the registered office. |
| 276 | Section 8. Section 721.855, Florida Statutes, is created |
| 277 | to read: |
| 278 | 721.855 Procedure for the nonjudicial foreclosure of |
| 279 | assessment liens.-The provisions of this section establish a |
| 280 | nonjudicial foreclosure procedure for assessment liens. |
| 281 | (1) APPOINTMENT OF TRUSTEE.- |
| 282 | (a) A trustee or a substitute trustee may be appointed by |
| 283 | a lienholder at any time by recording a notice of appointment of |
| 284 | trustee or notice of substitution of trustee in the public |
| 285 | records of the county or counties in which the timeshare |
| 286 | interest is located. A lienholder may appoint multiple trustees |
| 287 | in a single appointment, and any appointed trustee may be used |
| 288 | by the lienholder regarding the nonjudicial foreclosure of any |
| 289 | assessment lien under any timeshare plan for which the trustee |
| 290 | is appointed. |
| 291 | (b) The recorded notice of appointment of trustee or |
| 292 | notice of substitution of trustee shall contain the name and |
| 293 | address of the trustee or substitute trustee, the name and |
| 294 | address of the lienholder, and the name and address of the |
| 295 | timeshare plan. |
| 296 | (c) The lienholder shall maintain a list of all trustees |
| 297 | and substitute trustees appointed by the lienholder and shall |
| 298 | provide an obligor with verification that a particular person is |
| 299 | an appointed trustee or substitute trustee within 3 business |
| 300 | days following receipt of a written request for such |
| 301 | verification from the obligor. |
| 302 | (2) INITIATING THE USE OF A NONJUDICIAL FORECLOSURE |
| 303 | PROCEDURE.- |
| 304 | (a) Before initiating the nonjudicial foreclosure |
| 305 | procedure against any timeshare interest in a given timeshare |
| 306 | plan, the managing entity shall inform owners of timeshare |
| 307 | interests in the timeshare plan in writing that the managing |
| 308 | entity has the right to elect to use the nonjudicial foreclosure |
| 309 | procedure with respect to foreclosure of assessment liens as |
| 310 | established in this section. The managing entity shall be deemed |
| 311 | to have complied with the requirements of this paragraph if the |
| 312 | owners of timeshare interests in the given timeshare plan are |
| 313 | informed by mail sent to each owner's notice address, in the |
| 314 | notice of an annual or special meeting of the owners, by posting |
| 315 | on the website of the applicable timeshare plan, or by any owner |
| 316 | communication used by the managing entity. |
| 317 | (b) Before initiating the nonjudicial foreclosure |
| 318 | procedure against any timeshare interest, a claim of lien |
| 319 | against the timeshare interest shall be recorded pursuant to s. |
| 320 | 721.16 or, if applicable, s. 718.116 or s. 719.108, and the |
| 321 | notice of the intent to file a lien shall be given pursuant to |
| 322 | s. 718.121 for timeshare condominiums and s. 719.108 for |
| 323 | timeshare cooperatives. |
| 324 | (c)1. In order to initiate a nonjudicial foreclosure |
| 325 | procedure against a timeshare interest, the lienholder shall |
| 326 | deliver an affidavit to the trustee that identifies the obligor, |
| 327 | the notice address of the obligor, the timeshare interest, the |
| 328 | official records book and page number where the claim of lien is |
| 329 | recorded, and the name and notice address of any junior |
| 330 | interestholder. The affidavit shall be accompanied by a title |
| 331 | search of the timeshare interest identifying any junior |
| 332 | interestholders of record, and the title search must be |
| 333 | performed within 60 calendar days before the date of the |
| 334 | affidavit. |
| 335 | 2. The affidavit shall also state that the obligor has |
| 336 | defaulted in the obligation to make a payment under a specified |
| 337 | provision of the timeshare instrument or applicable law. |
| 338 | 3. The affidavit shall also specify the amounts secured by |
| 339 | the lien as of the date of the affidavit and a per diem amount |
| 340 | to account for further accrual of the amounts secured by the |
| 341 | lien. |
| 342 | (3) OBLIGOR'S RIGHT TO OBJECT TO USE OF THE NONJUDICIAL |
| 343 | FORECLOSURE PROCEDURE.- |
| 344 | (a) The obligor may object to the lienholder's use of the |
| 345 | nonjudicial foreclosure procedure for a specific default at any |
| 346 | time before the sale of the timeshare interest under subsection |
| 347 | (8) by delivering a written objection to the trustee using the |
| 348 | objection form provided for in subsection (5). If the trustee |
| 349 | receives the written objection from the obligor, the trustee may |
| 350 | not proceed with the nonjudicial foreclosure procedure as to the |
| 351 | default specified in the notice of default and intent to sell |
| 352 | under subsection (5), and the lienholder may proceed thereafter |
| 353 | only with a judicial foreclosure action as to that specified |
| 354 | default. |
| 355 | (b) If the obligor delivers the written objection |
| 356 | authorized in paragraph (a) to the trustee more than 30 calendar |
| 357 | days after the notice of default and intent to sell is deemed |
| 358 | perfected under subsection (5), the lienholder is entitled to |
| 359 | collect from the obligor in a judicial foreclosure procedure all |
| 360 | of the costs incurred in the nonjudicial foreclosure procedure. |
| 361 | (4) CONDITIONS TO TRUSTEE'S EXERCISE OF POWER OF SALE.-A |
| 362 | trustee may sell an encumbered timeshare interest foreclosed |
| 363 | under this section if: |
| 364 | (a) The trustee has received the affidavit from the |
| 365 | lienholder under paragraph (2)(c); |
| 366 | (b) The trustee has not received a written objection to |
| 367 | the use of the nonjudicial foreclosure procedure under |
| 368 | subsection (3); |
| 369 | (c) There is no lis pendens recorded and pending against |
| 370 | the same timeshare interest and the trustee has not been served |
| 371 | notice of the filing of any action to enjoin the nonjudicial |
| 372 | foreclosure sale; |
| 373 | (d) The trustee has provided written notice of default and |
| 374 | intent to sell as required by subsection (5) and a period of at |
| 375 | least 30 calendar days has elapsed after such notice is deemed |
| 376 | perfected under subsection (5); and |
| 377 | (e) The notice of sale required by subsection (6) has been |
| 378 | recorded in the public records of the county or counties in |
| 379 | which the timeshare interest is located. |
| 380 | (5) NOTICE OF DEFAULT AND INTENT TO SELL.- |
| 381 | (a) In any foreclosure proceeding under this section, the |
| 382 | trustee is required to notify the obligor of the proceeding by |
| 383 | sending the obligor a written notice of default and intent to |
| 384 | sell to the notice address of the obligor by certified or |
| 385 | registered mail, return receipt requested, or by a permitted |
| 386 | delivery service, return receipt requested, as follows: |
| 387 | 1. The notice of default and intent to sell shall identify |
| 388 | the obligor, the notice address of the obligor, the legal |
| 389 | description of the timeshare interest, the nature of the |
| 390 | default, the amounts secured by the lien, and a per diem amount |
| 391 | to account for further accrual of the amounts secured by the |
| 392 | lien and shall state the method by which the obligor may cure |
| 393 | the default. |
| 394 | 2. The notice of default and intent to sell shall include |
| 395 | an objection form with which the obligor can object to the use |
| 396 | of the nonjudicial procedure by signing and returning the |
| 397 | objection form to the trustee. The objection form shall identify |
| 398 | the obligor, the notice address of the obligor, the timeshare |
| 399 | interest, and the return address of the trustee and shall state: |
| 400 | "The undersigned obligor exercises the obligor's right to object |
| 401 | to the use of the nonjudicial foreclosure procedure contained in |
| 402 | section 721.855, Florida Statutes." |
| 403 | 3. The notice of default and intent to sell shall also |
| 404 | contain a statement in substantially the following form: |
| 405 |
|
| 406 | If you fail to cure the default as set forth in this |
| 407 | notice or take other appropriate action with regard to |
| 408 | this foreclosure matter, you risk losing ownership of |
| 409 | your timeshare interest through the nonjudicial |
| 410 | foreclosure procedure established in section 721.855, |
| 411 | Florida Statutes. You may choose to sign and send to |
| 412 | the trustee the enclosed objection form, exercising |
| 413 | your right to object to the use of the nonjudicial |
| 414 | procedure. If you do not object to the use of the |
| 415 | nonjudicial foreclosure procedure, you shall not be |
| 416 | subject to a deficiency judgment even if the proceeds |
| 417 | from the sale of your timeshare interest are |
| 418 | insufficient to offset the amounts secured by the |
| 419 | lien, which may include all past due amounts, accrued |
| 420 | interest, late fees, taxes, advances for the payment |
| 421 | of taxes, insurance and maintenance of the timeshare |
| 422 | interest, and any fees or costs incurred by the |
| 423 | lienholder or trustee, including any reasonable |
| 424 | attorney's fees, trustee's fees, and costs incurred in |
| 425 | connection with the default. Upon the trustee's |
| 426 | receipt of your signed objection form, the foreclosure |
| 427 | of the lien with respect to the default specified in |
| 428 | this notice shall be subject to the judicial |
| 429 | foreclosure procedure only. You have the right to cure |
| 430 | your default in the manner set forth in this notice at |
| 431 | any time before the trustee's sale of your timeshare |
| 432 | interest. If you object to the use of the nonjudicial |
| 433 | foreclosure procedure, you may be subject to a |
| 434 | deficiency judgment under any subsequent judicial |
| 435 | foreclosure action. In addition, if you deliver your |
| 436 | written objection to the trustee more than 30 calendar |
| 437 | days after the notice of default and intent to sell |
| 438 | has been delivered, the lienholder is entitled to |
| 439 | collect from you in a judicial foreclosure procedure |
| 440 | all of the costs incurred in the nonjudicial |
| 441 | foreclosure procedure. |
| 442 |
|
| 443 | 4. The trustee shall also mail a copy of the notice of |
| 444 | default and intent to sell, without the objection form, to the |
| 445 | notice address of any junior interestholder by certified or |
| 446 | registered mail, return receipt requested, or by a permitted |
| 447 | delivery service, return receipt requested. |
| 448 | 5. Notice under this paragraph is considered perfected |
| 449 | upon the trustee receiving the return receipt bearing the |
| 450 | signature of the obligor. |
| 451 | (b) If a signed return receipt from the certified or |
| 452 | registered mail or the permitted delivery service is received by |
| 453 | the trustee within 30 calendar days after the trustee sent the |
| 454 | notice under paragraph (a), but the trustee cannot ascertain |
| 455 | from the receipt that the obligor is the person who signed the |
| 456 | receipt, the trustee shall send a second notice in the form |
| 457 | required under paragraph (a) to the notice address of the |
| 458 | obligor by certified or registered mail, return receipt |
| 459 | requested, or by a permitted delivery service, return receipt |
| 460 | requested. Notice under this paragraph is considered perfected |
| 461 | upon the trustee receiving the return receipt for the second |
| 462 | notice bearing the signature of the obligor. Unless the trustee |
| 463 | receives a signed return receipt from the certified or |
| 464 | registered mail or the permitted delivery service for the second |
| 465 | notice within 30 calendar days after the trustee sent the notice |
| 466 | under this paragraph and the trustee can ascertain from the |
| 467 | receipt that the obligor is the person who signed the receipt, |
| 468 | the trustee shall perfect service in the manner set forth in |
| 469 | either paragraph (c) or paragraph (d). |
| 470 | (c) If a signed return receipt from the certified or |
| 471 | registered mail or the permitted delivery service is not |
| 472 | received by the trustee within 30 calendar days after the |
| 473 | trustee sent the notice under paragraph (a) or the second notice |
| 474 | under paragraph (b), if applicable, the trustee shall mail a |
| 475 | copy of the notice required by paragraph (a) by first class |
| 476 | mail, postage prepaid, to the notice address of the person with |
| 477 | the return address of the trustee on the envelope. Notice under |
| 478 | this paragraph is considered perfected upon the mailing of the |
| 479 | copy of the notice to the person. |
| 480 | (d)1. If the notice required by paragraph (a) or the |
| 481 | second notice required by paragraph (b), if applicable, is |
| 482 | returned as undeliverable within 30 calendar days after the |
| 483 | trustee sent the notice and if by a diligent search and inquiry |
| 484 | the trustee cannot obtain a different address for the obligor or |
| 485 | junior interestholder, the trustee may perfect notice against |
| 486 | that person by publication in a newspaper of general circulation |
| 487 | in the county or counties in which the timeshare interest is |
| 488 | located. The notice shall appear at least once a week for 2 |
| 489 | consecutive weeks. The trustee may group an unlimited number of |
| 490 | notices in the same publication, provided that all of the |
| 491 | notices pertain to the same timeshare plan. Notice under this |
| 492 | subparagraph is considered perfected upon publication as |
| 493 | required in this subparagraph. |
| 494 | 2. If the trustee's diligent search and inquiry produces |
| 495 | an address different from the notice address, the trustee shall |
| 496 | mail a copy of the notice by first class mail, postage prepaid, |
| 497 | to the new address with the return address of the trustee on the |
| 498 | envelope. Notice under this subparagraph is considered perfected |
| 499 | upon the mailing of the copy of the notice to the new address. |
| 500 | (e) If notice is perfected under paragraph (a) or |
| 501 | paragraph (b), the trustee shall execute an affidavit in |
| 502 | recordable form setting forth the manner in which notice was |
| 503 | perfected and attach the affidavit to the certificate of |
| 504 | compliance set forth in subsection (7). The affidavit shall |
| 505 | state the nature of the notice, the date on which the notice was |
| 506 | mailed, the name and address on the envelope containing the |
| 507 | notice, the manner in which the notice was mailed, and the basis |
| 508 | for that knowledge. The signed return receipt from the certified |
| 509 | or registered mail or the permitted delivery service shall be |
| 510 | attached to the affidavit. |
| 511 | (f) If notice is perfected under paragraph (c), the |
| 512 | trustee shall execute an affidavit in recordable form setting |
| 513 | forth the manner in which notice was perfected and attach the |
| 514 | affidavit to the certificate of compliance set forth in |
| 515 | subsection (7). The affidavit shall state the nature of the |
| 516 | notice, the date on which the notice was mailed, the name and |
| 517 | address on the envelope containing the notice, the manner in |
| 518 | which the notice was mailed, the fact that a signed receipt from |
| 519 | the certified or registered mail or the permitted delivery |
| 520 | service was not timely received, the date on which a copy of the |
| 521 | notice was mailed again by first class mail with the return |
| 522 | address of the trustee on the envelope, and the name and address |
| 523 | on the envelope containing the notice. The envelopes from the |
| 524 | attempts to mail notice, if available, shall also be attached to |
| 525 | the affidavit. |
| 526 | (g) If notice is perfected by publication under paragraph |
| 527 | (d), the trustee shall execute an affidavit in recordable form |
| 528 | setting forth the manner in which notice was perfected and |
| 529 | attach the affidavit to the certificate of compliance set forth |
| 530 | in subsection (7). The affidavit shall include all the |
| 531 | information contained in paragraph (f) and shall also state that |
| 532 | the notice was perfected by publication after diligent search |
| 533 | and inquiry was made for the current address for the obligor. |
| 534 | The returned envelope from the attempt to mail notice of the |
| 535 | publication, if available, shall be attached to the affidavit. |
| 536 | No other action of the trustee is necessary to perfect notice. |
| 537 | (6) NOTICE OF SALE.- |
| 538 | (a) The notice of sale shall set forth: |
| 539 | 1. The name and notice addresses of the obligor and any |
| 540 | junior interestholder. |
| 541 | 2. The legal description of the timeshare interest. |
| 542 | 3. The name and address of the trustee. |
| 543 | 4. A description of the default that is the basis for the |
| 544 | foreclosure. |
| 545 | 5. The official records book and page numbers where the |
| 546 | claim of lien is recorded. |
| 547 | 6. The amounts secured by the lien and a per diem amount |
| 548 | to account for further accrual of the amounts secured by the |
| 549 | lien. |
| 550 | 7. The date, location, and starting time of the trustee's |
| 551 | sale. |
| 552 | 8. The right of and the method by which the obligor may |
| 553 | cure the default or the right of any junior interestholder to |
| 554 | redeem its interest up to the date the trustee issues the |
| 555 | certificate of sale in accordance with paragraph (8)(f). |
| 556 | (b) The trustee shall send a copy of the notice of sale on |
| 557 | the date it is submitted for recording, by first class mail, |
| 558 | postage prepaid, to the notice addresses of the obligor and any |
| 559 | junior interestholder. |
| 560 | (c) Subsequent to the date of recording of the notice of |
| 561 | sale, no notice is required to be given to any person claiming |
| 562 | an interest in the timeshare interest except as provided in this |
| 563 | section. The recording of the notice of sale has the same force |
| 564 | and effect as the filing of a lis pendens in a judicial |
| 565 | proceeding under s. 48.23. |
| 566 | (d)1. The trustee shall publish the notice of sale in a |
| 567 | newspaper of general circulation in the county or counties in |
| 568 | which the timeshare interest is located at least once a week for |
| 569 | 2 consecutive weeks before the date of the sale. The last |
| 570 | publication shall occur at least 5 calendar days before the |
| 571 | sale. |
| 572 | 2. The trustee may group an unlimited number of notices of |
| 573 | sale in the same publication, provided that all of the notices |
| 574 | of sale pertain to the same timeshare plan. |
| 575 | (7) TRUSTEE'S CERTIFICATE OF COMPLIANCE.- |
| 576 | (a) Within 3 business days after the trustee conducts a |
| 577 | sale, the trustee shall execute and acknowledge a certificate of |
| 578 | compliance and record it in the public records of the county or |
| 579 | counties in which the timeshare interest is located. |
| 580 | (b) In the certificate of compliance, the trustee shall: |
| 581 | 1. Confirm delivery of the notice of default and intent to |
| 582 | sell and attach the affidavit required by subsection (5). |
| 583 | 2. State that the default was not cured and the timeshare |
| 584 | interest was not redeemed, and state that the trustee did not |
| 585 | receive any written objection pursuant subsection (3). |
| 586 | 3. Confirm that the notice of sale was published as |
| 587 | required under paragraph (6)(d) and attach an affidavit of |
| 588 | publication for the notice of sale. |
| 589 | 4. Confirm that the notice of sale was mailed pursuant to |
| 590 | paragraph (6)(b) together with a list of the parties to whom the |
| 591 | notice of sale was mailed. |
| 592 | (c) In furtherance of the execution and recording of the |
| 593 | certificate of compliance required under this subsection, the |
| 594 | trustee is entitled to rely upon an affidavit or certification |
| 595 | from the lienholder as to the facts and circumstances of default |
| 596 | and failure to cure the default. |
| 597 | (8) MANNER OF SALE.- |
| 598 | (a) The sale of a timeshare interest by the trustee in a |
| 599 | public auction shall be held in the county in which the |
| 600 | timeshare interest is located, on the date, location, and |
| 601 | starting time designated in the notice of sale, which shall be |
| 602 | after 9:00 a.m. but before 4:00 p.m. on a business day not less |
| 603 | than 30 calendar days after the recording of the notice of sale. |
| 604 | The trustee's sale may occur online at a specific website on the |
| 605 | Internet or in any other manner used by the clerk of the court |
| 606 | for a judicial foreclosure sales procedure in the county or |
| 607 | counties in which the timeshare interest is located. |
| 608 | (b) The trustee shall conduct the sale and act as the |
| 609 | auctioneer. |
| 610 | (c) The lienholder and any person other than the trustee |
| 611 | may bid at the sale. In lieu of participating in the sale, the |
| 612 | lienholder may send the trustee written bidding instructions |
| 613 | that the trustee shall announce as appropriate during the sale. |
| 614 | (d) The trustee may postpone the sale from time to time. |
| 615 | In such case, notice of postponement must be given by the |
| 616 | trustee at the date, time, and location contained in the notice |
| 617 | of sale. The notice of sale for the postponed sale shall be |
| 618 | mailed pursuant to paragraph (6)(b), recorded pursuant to |
| 619 | paragraph (4)(e), and published pursuant to paragraph (6)(d). |
| 620 | The effective date of the initial notice of sale for purposes of |
| 621 | paragraph (4)(b) is not affected by a postponed sale. |
| 622 | (e) The highest bidder of the timeshare interest shall pay |
| 623 | the price bid to the trustee in cash or certified funds on the |
| 624 | day of the sale. If the lienholder is the highest bidder, the |
| 625 | lienholder shall receive a credit up to the amount set forth in |
| 626 | the notice of sale as required by subparagraph (6)(a)6. |
| 627 | (f) On the date of the sale and upon receipt of the cash |
| 628 | or certified funds due from the highest bidder, the trustee |
| 629 | shall issue to the highest bidder a certificate of sale stating |
| 630 | that a foreclosure conforming to the requirements of this |
| 631 | section has occurred, including the time, location, and date of |
| 632 | the sale, that the timeshare interest was sold, the amounts |
| 633 | secured by the lien, and the amount of the highest bid. A copy |
| 634 | of the certificate of sale shall be mailed by certified or |
| 635 | registered mail, return receipt requested, or by a permitted |
| 636 | delivery service, return receipt requested, to all persons |
| 637 | entitled to receive a notice of sale under subsection (6). |
| 638 | (9) EFFECT OF TRUSTEE'S SALE.- |
| 639 | (a) A sale conducted under subsection (8) forecloses and |
| 640 | terminates all interests of any person to whom notice is given |
| 641 | under paragraph (4)(d) and paragraph (6)(b), and of any other |
| 642 | person claiming by, through, or under any such person, in the |
| 643 | affected timeshare interest. The assessment lien does not merge |
| 644 | into the trustee's deed to any extent that a subsequent judicial |
| 645 | foreclosure or reforeclosure of the assessment lien becomes |
| 646 | necessary or required. A failure to give notice to any person |
| 647 | entitled to notice does not affect the validity of the sale as |
| 648 | to the interests of any person properly notified. A person |
| 649 | entitled to notice but not given notice has the rights of a |
| 650 | person not made a defendant in a judicial foreclosure. |
| 651 | (b) A lienholder may conduct a subsequent foreclosure of a |
| 652 | timeshare interest to correct any failure to meet the |
| 653 | requirements of this section before the issuance of a |
| 654 | certificate of sale under paragraph (8)(f). |
| 655 | (c) On the issuance of a certificate of sale under |
| 656 | paragraph (8)(f), all rights of redemption that have been |
| 657 | foreclosed under this section shall terminate. |
| 658 | (d) A sale conducted under subsection (8) extinguishes the |
| 659 | assessment lien and the obligor's liability for all amounts |
| 660 | secured by the lien. The lienholder has no right to any |
| 661 | deficiency judgment against the obligor after a sale of the |
| 662 | obligor's timeshare interest under this section. |
| 663 | (e) The issuance and recording of the trustee's deed is |
| 664 | presumed valid and may be relied upon by third parties without |
| 665 | actual knowledge of irregularities in the sale. |
| 666 | (10) TRUSTEE'S DEED.- |
| 667 | (a) The trustee's deed shall include the name and address |
| 668 | of the trustee, the name and address of the highest bidder, the |
| 669 | name of the former owner, a legal description of the timeshare |
| 670 | interest, and the name and address of the preparer of the |
| 671 | trustee's deed. The trustee's deed shall recite that the |
| 672 | certificate of compliance was recorded, and shall contain no |
| 673 | warranties of title from the trustee. |
| 674 | (b) Ten calendar days after a sale, absent the prior |
| 675 | filing and service on the trustee of a judicial action to enjoin |
| 676 | issuance of the trustee's deed to the timeshare interest, the |
| 677 | trustee shall: |
| 678 | 1. Issue a trustee's deed to the highest bidder. |
| 679 | 2. Record the trustee's deed in the public records of the |
| 680 | county or counties in which the timeshare interest is located. |
| 681 | (c)1. The certificate of compliance and trustee's deed |
| 682 | together are presumptive evidence of the truth of the matters |
| 683 | set forth in them, and no action to set aside the sale and void |
| 684 | the trustee's deed may be filed or otherwise pursued against any |
| 685 | person acquiring the timeshare interest for value, including any |
| 686 | subsequent mortgagee or buyer. |
| 687 | 2. The trustee's deed conveys to the highest bidder all |
| 688 | rights, title, and interest in the timeshare interest that the |
| 689 | former owner had, or had the power to convey, at the time of the |
| 690 | recording of the claim of lien, together with all rights, title, |
| 691 | and interest that the former owner or his or her successors in |
| 692 | interest acquired after the recording of the claim of lien. |
| 693 | 3. The issuance and recording of a trustee's deed shall |
| 694 | have the same force and effect as the issuance and recording of |
| 695 | a certificate of title by the clerk of the court in a judicial |
| 696 | foreclosure action. |
| 697 | (11) DISPOSITION OF PROCEEDS OF SALE.- |
| 698 | (a) The trustee shall apply the proceeds of the sale as |
| 699 | follows: |
| 700 | 1. To the expenses of the sale, including compensation of |
| 701 | the trustee. |
| 702 | 2. To the amount owed and set forth in the notice as |
| 703 | required in subparagraph (6)(a)6. |
| 704 | 3. If there are junior interestholders, the trustee may |
| 705 | file an action in interpleader, pay the surplus to a court of |
| 706 | competent jurisdiction, name the competing junior |
| 707 | interestholders, and ask the court to determine the proper |
| 708 | distribution of the surplus. In any interpleader action, the |
| 709 | trustee shall recover reasonable attorney's fees and costs. |
| 710 | 4. If there are no junior interestholders, or if all |
| 711 | junior interestholders have been paid, any surplus shall be paid |
| 712 | to the former owner. If the trustee is unable to locate the |
| 713 | former owner 1 year after the sale, the surplus, if any, shall |
| 714 | be deposited with the Chief Financial Officer pursuant to |
| 715 | chapter 717. |
| 716 | (b) In disposing of the proceeds of the sale, the trustee |
| 717 | may rely on the information provided in the affidavit of the |
| 718 | lienholder under paragraph (2)(c) and, in the event of a dispute |
| 719 | or uncertainty over such claims, the trustee has the discretion |
| 720 | to submit the matter to adjudication by court, by interpleader, |
| 721 | or otherwise and shall recover reasonable attorney's fees and |
| 722 | costs. |
| 723 | (12) JUDICIAL FORECLOSURE ACTIONS.-The nonjudicial |
| 724 | foreclosure procedure established in this section does not |
| 725 | impair or otherwise affect the lienholder's continuing right to |
| 726 | bring a judicial foreclosure action, in lieu of using the |
| 727 | nonjudicial foreclosure procedure, with respect to any |
| 728 | assessment lien. |
| 729 | (13) APPLICATION.-This section applies to any default |
| 730 | giving rise to the imposition of an assessment lien which occurs |
| 731 | after the effective date of this section. An amendment to a |
| 732 | timeshare instrument is not required to permit a managing entity |
| 733 | lienholder to use the nonjudicial foreclosure procedures of this |
| 734 | section. If a timeshare instrument contains any provision that |
| 735 | prevents the use of nonjudicial foreclosure procedures, an |
| 736 | amendment to the timeshare instrument permitting the use of the |
| 737 | nonjudicial foreclosure procedure set forth in this section may |
| 738 | be adopted by a majority of those present and voting at a duly |
| 739 | called meeting of the owners' association at which at least 15 |
| 740 | percent of the voting interests are present in person or by |
| 741 | proxy. |
| 742 | (14) ACTIONS FOR FAILURE TO FOLLOW THE NONJUDICIAL |
| 743 | FORECLOSURE PROCEDURE.-An action for actual damages for a |
| 744 | material violation of this section may be brought by an obligor |
| 745 | against the lienholder for the failure to follow the nonjudicial |
| 746 | foreclosure procedure contained in this section. |
| 747 | Section 9. Section 721.856, Florida Statutes, is created |
| 748 | to read: |
| 749 | 721.856 Procedure for the nonjudicial foreclosure of |
| 750 | mortgage liens.-The provisions of this section establish a |
| 751 | nonjudicial foreclosure procedure for mortgage liens. |
| 752 | (1) APPOINTMENT OF TRUSTEE.- |
| 753 | (a) A trustee or a substitute trustee may be appointed by |
| 754 | a lienholder at any time by recording a notice of appointment of |
| 755 | trustee or notice of substitution of trustee in the public |
| 756 | records of the county or counties in which the timeshare |
| 757 | interest is located. A lienholder may appoint multiple trustees |
| 758 | in a single appointment, and any appointed trustee may be used |
| 759 | by the lienholder regarding the nonjudicial foreclosure of any |
| 760 | mortgage lien. |
| 761 | (b) The recorded notice of appointment of trustee or |
| 762 | notice of substitution of trustee shall contain the name and |
| 763 | address of the trustee or substitute trustee, the name and |
| 764 | address of the lienholder, and the name and address of the |
| 765 | timeshare plan. |
| 766 | (c) The lienholder shall maintain a list of all trustees |
| 767 | and substitute trustees appointed by the lienholder and shall |
| 768 | provide an obligor with verification that a particular person is |
| 769 | an appointed trustee or substitute trustee within 3 business |
| 770 | days after receipt of a written request for such verification |
| 771 | from the obligor. |
| 772 | (2) INITIATING THE NONJUDICIAL FORECLOSURE OF MORTGAGE |
| 773 | LIENS.- |
| 774 | (a) Before initiating the nonjudicial foreclosure against |
| 775 | a timeshare interest, the mortgage, or an amendment to a |
| 776 | mortgage executed by the obligor before the effective date of |
| 777 | this section, must contain a statement in substantially the |
| 778 | following form: |
| 779 | |
| 780 | If the mortgagor fails to make timely payments under |
| 781 | the obligation secured by this mortgage, or is |
| 782 | otherwise deemed in uncured default of this mortgage, |
| 783 | the lien against the mortgagor's timeshare interest |
| 784 | created by this mortgage may be foreclosed in |
| 785 | accordance with either a judicial foreclosure |
| 786 | procedure or a nonjudicial procedure and may result in |
| 787 | the loss of your timeshare interest. If the mortgagee |
| 788 | initiates a nonjudicial foreclosure procedure, the |
| 789 | mortgagor shall have the option to object and the |
| 790 | mortgagee may proceed only by filing a judicial |
| 791 | foreclosure action. |
| 792 |
|
| 793 | (b)1. In order to initiate a nonjudicial foreclosure |
| 794 | procedure against a timeshare interest, the lienholder shall |
| 795 | deliver an affidavit to the trustee that identifies the obligor, |
| 796 | the notice address of the obligor, the timeshare interest, the |
| 797 | official records book and page number where the mortgage is |
| 798 | recorded, and the name and notice address of any junior |
| 799 | interestholder. The affidavit shall be accompanied by a title |
| 800 | search of the timeshare interest identifying any junior |
| 801 | interestholders of record, and the title search must be |
| 802 | performed within 60 calendar days before the date of the |
| 803 | affidavit. |
| 804 | 2. The affidavit shall also state that the obligor has |
| 805 | defaulted in the obligation to make a payment under a specified |
| 806 | provision of the mortgage or is otherwise deemed in uncured |
| 807 | default under a specified provision of the mortgage. |
| 808 | 3. The affidavit shall also specify the amounts secured by |
| 809 | the lien as of the date of the affidavit and a per diem amount |
| 810 | to account for further accrual of the amounts secured by the |
| 811 | lien. |
| 812 | (3) OBLIGOR'S RIGHT TO OBJECT TO USE OF THE NONJUDICIAL |
| 813 | FORECLOSURE PROCEDURE.- |
| 814 | (a) The obligor may object to the lienholder's use of the |
| 815 | nonjudicial foreclosure procedure for a specific default at any |
| 816 | time before the sale of the timeshare interest under subsection |
| 817 | (8) by delivering a written objection to the trustee using the |
| 818 | objection form provided for in subsection (5). If the trustee |
| 819 | receives the written objection from the obligor, the trustee may |
| 820 | not proceed with the nonjudicial foreclosure procedure as to the |
| 821 | default specified in the notice of default and intent to sell |
| 822 | under subsection (5), and the lienholder may proceed thereafter |
| 823 | only with a judicial foreclosure action as to that specified |
| 824 | default. |
| 825 | (b) If the obligor delivers the written objection |
| 826 | authorized in paragraph (a) to the trustee more than 30 calendar |
| 827 | days after the notice of default and intent to sell is deemed |
| 828 | perfected under subsection (5), the lienholder is entitled to |
| 829 | collect from the obligor in a judicial foreclosure procedure all |
| 830 | of the costs incurred in the nonjudicial foreclosure procedure. |
| 831 | (4) CONDITIONS TO TRUSTEE'S EXERCISE OF POWER OF SALE.-A |
| 832 | trustee may sell an encumbered timeshare interest foreclosed |
| 833 | under this section if: |
| 834 | (a) The trustee has received the affidavit from the |
| 835 | lienholder under paragraph (2)(c); |
| 836 | (b) The trustee has not received a written objection to |
| 837 | the use of the nonjudicial foreclosure procedure under |
| 838 | subsection (3); |
| 839 | (c) There is no lis pendens recorded and pending against |
| 840 | the same timeshare interest, and the trustee has not been served |
| 841 | notice of the filing of any action to enjoin the nonjudicial |
| 842 | foreclosure sale; |
| 843 | (d) The trustee is in possession of the original |
| 844 | promissory note executed by the mortgagor and secured by the |
| 845 | mortgage lien; |
| 846 | (e) The trustee has provided written notice of default and |
| 847 | intent to sell as required by subsection (5) and a period of at |
| 848 | least 30 calendar days has elapsed after such notice is deemed |
| 849 | perfected under subsection (5); and |
| 850 | (f) The notice of sale required by subsection (6) has been |
| 851 | recorded in the public records of the county in which the |
| 852 | mortgage was recorded. |
| 853 | (5) NOTICE OF DEFAULT AND INTENT TO SELL.- |
| 854 | (a) In any foreclosure proceeding under this section, the |
| 855 | trustee is required to notify the obligor of the proceeding by |
| 856 | sending the obligor a written notice of default and intent to |
| 857 | sell to the notice address of the obligor by certified or |
| 858 | registered mail, return receipt requested, or by a permitted |
| 859 | delivery service, return receipt requested, as follows: |
| 860 | 1. The notice of default and intent to sell shall identify |
| 861 | the obligor, the notice address of the obligor, the legal |
| 862 | description of the timeshare interest, the nature of the |
| 863 | default, the amounts secured by the lien, and a per diem amount |
| 864 | to account for further accrual of the amounts secured by the |
| 865 | lien and shall state the method by which the obligor may cure |
| 866 | the default. |
| 867 | 2. The notice of default and intent to sell shall include |
| 868 | an objection form with which the obligor can object to the use |
| 869 | of the nonjudicial procedure by signing and returning the |
| 870 | objection form to the trustee. The objection form shall identify |
| 871 | the obligor, the notice address of the obligor, the timeshare |
| 872 | interest, and the return address of the trustee and shall state: |
| 873 | "The undersigned obligor exercises the obligor's right to object |
| 874 | to the use of the nonjudicial foreclosure procedure contained in |
| 875 | section 721.856, Florida Statutes." |
| 876 | 3. The notice of default and intent to sell shall also |
| 877 | contain a statement in substantially the following form: |
| 878 | |
| 879 | If you fail to cure the default as set forth in this |
| 880 | notice or take other appropriate action with regard to |
| 881 | this foreclosure matter, you risk losing ownership of |
| 882 | your timeshare interest through the nonjudicial |
| 883 | foreclosure procedure established in section 721.856, |
| 884 | Florida Statutes. You may choose to sign and send to |
| 885 | the trustee the enclosed objection form, exercising |
| 886 | your right to object to the use of the nonjudicial |
| 887 | procedure. If you do not object to the use of the |
| 888 | nonjudicial foreclosure procedure, you shall not be |
| 889 | subject to a deficiency judgment even if the proceeds |
| 890 | from the sale of your timeshare interest are |
| 891 | insufficient to offset the amounts secured by the |
| 892 | lien, which may include all past due amounts, accrued |
| 893 | interest, late fees, taxes, advances for the payment |
| 894 | of taxes, insurance, and maintenance of the timeshare |
| 895 | interest, and any fees or costs incurred by the |
| 896 | lienholder or trustee, including any reasonable |
| 897 | attorney's fees, trustee's fees and costs incurred in |
| 898 | connection with the default. Upon the trustee's |
| 899 | receipt of your signed objection form, the foreclosure |
| 900 | of the lien with respect to the default specified in |
| 901 | this notice shall be subject to the judicial |
| 902 | foreclosure procedure only. You have the right to cure |
| 903 | your default in the manner set forth in this notice at |
| 904 | any time before the trustee's sale of your timeshare |
| 905 | interest. If you object to the use of the nonjudicial |
| 906 | foreclosure procedure, you may be subject to a |
| 907 | deficiency judgment under any subsequent judicial |
| 908 | foreclosure action. In addition, if you deliver your |
| 909 | written objection to the trustee more than 30 calendar |
| 910 | days after the notice of default and intent to sell |
| 911 | has been delivered, the lienholder is entitled to |
| 912 | collect from you in a judicial foreclosure procedure |
| 913 | all of the costs incurred in the nonjudicial |
| 914 | foreclosure procedure. |
| 915 |
|
| 916 | 4. The trustee shall also mail a copy of the notice of |
| 917 | default and intent to sell, without the objection form, to the |
| 918 | notice address of any junior interestholder by certified or |
| 919 | registered mail, return receipt requested, or by a permitted |
| 920 | delivery service, return receipt requested. |
| 921 | 5. Notice under this paragraph is considered perfected |
| 922 | upon the trustee receiving the return receipt bearing the |
| 923 | signature of the obligor. |
| 924 | (b) If a signed return receipt from the certified or |
| 925 | registered mail or the permitted delivery service is received by |
| 926 | the trustee within 30 calendar days after the trustee sent the |
| 927 | notice under paragraph (a), but the trustee cannot ascertain |
| 928 | from the receipt that the obligor is the person who signed the |
| 929 | receipt, the trustee shall send a second notice in the form |
| 930 | required under paragraph (a) to the notice address of the |
| 931 | obligor by certified or registered mail, return receipt |
| 932 | requested, or by a permitted delivery service, return receipt |
| 933 | requested. Notice under this paragraph is considered perfected |
| 934 | upon the trustee receiving the return receipt for the second |
| 935 | notice bearing the signature of the obligor. Unless the trustee |
| 936 | receives a signed return receipt from the certified or |
| 937 | registered mail or the permitted delivery service for the second |
| 938 | notice within 30 calendar days after the trustee sent the notice |
| 939 | under this paragraph and the trustee can ascertain from the |
| 940 | receipt that the obligor is the person who signed the receipt, |
| 941 | the trustee shall perfect service in the manner set forth in |
| 942 | either paragraph (c) or paragraph (d). |
| 943 | (c) If a signed return receipt from the certified or |
| 944 | registered mail or the permitted delivery service is not |
| 945 | received by the trustee within 30 calendar days after the |
| 946 | trustee sent the notice under paragraph (a) or the second notice |
| 947 | under paragraph (b), if applicable, the trustee shall mail a |
| 948 | copy of the notice required by paragraph (a) by first class |
| 949 | mail, postage prepaid, to the notice address of the person with |
| 950 | the return address of the trustee on the envelope. Notice under |
| 951 | this paragraph is considered perfected upon the mailing of the |
| 952 | copy of the notice to the person. |
| 953 | (d)1. If the notice required by paragraph (a) or the |
| 954 | second notice required by paragraph (b), if applicable, is |
| 955 | returned as undeliverable within 30 calendar days after the |
| 956 | trustee sent the notice and if by a diligent search and inquiry |
| 957 | the trustee cannot obtain a different address for the obligor or |
| 958 | junior interestholder, the trustee may perfect notice against |
| 959 | that person by publication in a newspaper of general circulation |
| 960 | in the county or counties in which the timeshare interest is |
| 961 | located. The notice shall appear at least once a week for 2 |
| 962 | consecutive weeks. The trustee may group an unlimited number of |
| 963 | notices in the same publication, provided that all of the |
| 964 | notices pertain to the same timeshare plan. Notice under this |
| 965 | subparagraph is considered perfected upon publication as |
| 966 | required in this subparagraph. |
| 967 | 2. If the trustee's diligent search and inquiry produces |
| 968 | an address different from the notice address, the trustee shall |
| 969 | mail a copy of the notice by first class mail, postage prepaid, |
| 970 | to the new address with the return address of the trustee on the |
| 971 | envelope. Notice under this subparagraph is considered perfected |
| 972 | upon the mailing of the copy of the notice to the new address. |
| 973 | (e) If notice is perfected under paragraph (a) or |
| 974 | paragraph (b), the trustee shall execute an affidavit in |
| 975 | recordable form setting forth the manner in which notice was |
| 976 | perfected and attach the affidavit to the certificate of |
| 977 | compliance set forth in subsection (7). The affidavit shall |
| 978 | state the nature of the notice, the date on which the notice was |
| 979 | mailed, the name and address on the envelope containing the |
| 980 | notice, the manner in which the notice was mailed, and the basis |
| 981 | for that knowledge. The signed return receipt from the certified |
| 982 | or registered mail or the permitted delivery service shall be |
| 983 | attached to the affidavit. |
| 984 | (f) If notice is perfected under paragraph (c), the |
| 985 | trustee shall execute an affidavit in recordable form setting |
| 986 | forth the manner in which notice was perfected and attach the |
| 987 | affidavit to the certificate of compliance set forth in |
| 988 | subsection (7). The affidavit shall state the nature of the |
| 989 | notice, the date on which the notice was mailed, the name and |
| 990 | address on the envelope containing the notice, the manner in |
| 991 | which the notice was mailed, the fact that a signed receipt from |
| 992 | the certified or registered mail or the permitted delivery |
| 993 | service was not timely received, the date on which a copy of the |
| 994 | notice was mailed again by first class mail with the return |
| 995 | address of the trustee on the envelope, and the name and address |
| 996 | on the envelope containing the notice. The envelopes from the |
| 997 | attempts to mail notice, if available, shall also be attached to |
| 998 | the affidavit. |
| 999 | (g) If notice is perfected by publication under paragraph |
| 1000 | (d), the trustee shall execute an affidavit in recordable form |
| 1001 | setting forth the manner in which notice was perfected and |
| 1002 | attach the affidavit to the certificate of compliance set forth |
| 1003 | in subsection (7). The affidavit shall include all the |
| 1004 | information contained in paragraph (f) and shall also state that |
| 1005 | the notice was perfected by publication after diligent search |
| 1006 | and inquiry was made for the current address for the obligor. |
| 1007 | The returned envelope from the attempt to mail notice of the |
| 1008 | publication, if available, shall be attached to the affidavit. |
| 1009 | No other action of the trustee is necessary to perfect notice. |
| 1010 | (6) NOTICE OF SALE.- |
| 1011 | (a) The notice of sale shall set forth: |
| 1012 | 1. The name and notice addresses of the obligor and any |
| 1013 | junior interestholder. |
| 1014 | 2. The legal description of the timeshare interest. |
| 1015 | 3. The name and address of the trustee. |
| 1016 | 4. A description of the default that is the basis for the |
| 1017 | foreclosure. |
| 1018 | 5. The official records book and page numbers where the |
| 1019 | mortgage is recorded. |
| 1020 | 6. The amounts secured by the lien and a per diem amount |
| 1021 | to account for further accrual of the amounts secured by the |
| 1022 | lien. |
| 1023 | 7. The date, location, and starting time of the trustee's |
| 1024 | sale. |
| 1025 | 8. The right of and the method by which the obligor may |
| 1026 | cure the default or the right of any junior interestholder to |
| 1027 | redeem its interest up to the date the trustee issues the |
| 1028 | certificate of sale in accordance with paragraph (8)(f). |
| 1029 | (b) The trustee shall send a copy of the notice of sale on |
| 1030 | the date it is submitted for recording, by first class mail, |
| 1031 | postage prepaid, to the notice addresses of the obligor and any |
| 1032 | junior interestholder. |
| 1033 | (c) Subsequent to the date of recording of the notice of |
| 1034 | sale, no notice is required to be given to any person claiming |
| 1035 | an interest in the timeshare interest except as provided in this |
| 1036 | section. The recording of the notice of sale has the same force |
| 1037 | and effect as the filing of a lis pendens in a judicial |
| 1038 | proceeding under s. 48.23. |
| 1039 | (d)1. The trustee shall publish the notice of sale in a |
| 1040 | newspaper of general circulation in the county or counties in |
| 1041 | which the timeshare interest is located at least once a week for |
| 1042 | two consecutive weeks before the date of the sale. The last |
| 1043 | publication shall occur at least 5 calendar days before the |
| 1044 | sale. |
| 1045 | 2. The trustee may group an unlimited number of notices of |
| 1046 | sale in the same publication, provided that all of the notices |
| 1047 | of sale pertain to the same timeshare plan. |
| 1048 | (7) TRUSTEE'S CERTIFICATE OF COMPLIANCE.- |
| 1049 | (a) Within 3 business days after the trustee conducts a |
| 1050 | sale, the trustee shall execute and acknowledge a certificate of |
| 1051 | compliance and record it in the public records of the county or |
| 1052 | counties in which the timeshare interest is located. |
| 1053 | (b) In the certificate of compliance, the trustee shall: |
| 1054 | 1. Confirm delivery of the notice of default and intent to |
| 1055 | sell and attach the affidavit required by subsection (5). |
| 1056 | 2. State that the default was not cured and the timeshare |
| 1057 | interest was not redeemed, and state that the trustee did not |
| 1058 | receive any written objection pursuant subsection (3). |
| 1059 | 3. State that the trustee is in possession of the original |
| 1060 | promissory note executed by the mortgagor and secured by the |
| 1061 | mortgage lien. |
| 1062 | 4. Confirm that the notice of sale was published as |
| 1063 | required under (6)(d) and attach an affidavit of publication for |
| 1064 | the notice of sale. |
| 1065 | 5. Confirm that the notice of sale was mailed pursuant to |
| 1066 | paragraph (6)(b) together with a list of the parties to whom the |
| 1067 | notice of sale was mailed. |
| 1068 | (c) In furtherance of the execution and recording of the |
| 1069 | certificate of compliance required under this subsection, the |
| 1070 | trustee is entitled to rely upon an affidavit or certification |
| 1071 | from the lienholder as to the facts and circumstances of default |
| 1072 | and failure to cure the default. |
| 1073 | (8) MANNER OF SALE.- |
| 1074 | (a) The sale of a timeshare interest by the trustee in a |
| 1075 | public auction shall be held in the county in which the |
| 1076 | timeshare interest is located, on the date, location, and |
| 1077 | starting time designated in the notice of sale, which shall be |
| 1078 | after 9:00 a.m. but before 4:00 p.m. on a business day not less |
| 1079 | than 30 calendar days after the recording of the notice of sale. |
| 1080 | The trustee's sale may occur online at a specific website on the |
| 1081 | Internet or in any other manner used by the clerk of the court |
| 1082 | for a judicial foreclosure sales procedure in the county or |
| 1083 | counties in which the timeshare interest is located. |
| 1084 | (b) The trustee shall conduct the sale and act as the |
| 1085 | auctioneer. |
| 1086 | (c) The lienholder and any person other than the trustee |
| 1087 | may bid at the sale. In lieu of participating in the sale, the |
| 1088 | lienholder may send the trustee written bidding instructions |
| 1089 | that the trustee shall announce as appropriate during the sale. |
| 1090 | (d) The trustee may postpone the sale from time to time. |
| 1091 | In such case, notice of postponement must be given by the |
| 1092 | trustee at the date, time, and location contained in the notice |
| 1093 | of sale. The notice of sale for the postponed sale shall be |
| 1094 | mailed pursuant to paragraph (6)(b), recorded pursuant to |
| 1095 | paragraph (4)(f), and published pursuant to paragraph (6)(d). |
| 1096 | The effective date of the initial notice of sale for purposes of |
| 1097 | paragraph (4)(b) is not affected by a postponed sale. |
| 1098 | (e) The highest bidder of the timeshare interest shall pay |
| 1099 | the price bid to the trustee in cash or certified funds on the |
| 1100 | day of the sale. If the lienholder is the highest bidder, the |
| 1101 | lienholder shall receive a credit up to the amount set forth in |
| 1102 | the notice of sale as required by subparagraph (6)(a)6. |
| 1103 | (f) On the date of the sale and upon receipt of the cash |
| 1104 | or certified funds due from the highest bidder, the trustee |
| 1105 | shall issue to the highest bidder a certificate of sale stating |
| 1106 | that a foreclosure conforming to the requirements of this |
| 1107 | section has occurred, including the time, location, and date of |
| 1108 | the sale, that the timeshare interest was sold, the amounts |
| 1109 | secured by the lien, and the amount of the highest bid. A copy |
| 1110 | of the certificate of sale shall be mailed by certified or |
| 1111 | registered mail, return receipt requested, or by a permitted |
| 1112 | delivery service, return receipt requested, to all persons |
| 1113 | entitled to receive a notice of sale under subsection (6). |
| 1114 | (9) EFFECT OF TRUSTEE'S SALE.- |
| 1115 | (a) A sale conducted under subsection (8) forecloses and |
| 1116 | terminates all interests of any person to whom notice is given |
| 1117 | under paragraph (4)(e) and paragraph (6)(b), and of any other |
| 1118 | person claiming by, through, or under any such person, in the |
| 1119 | affected timeshare interest. The mortgage lien does not merge |
| 1120 | into the trustee's deed to any extent that a subsequent judicial |
| 1121 | foreclosure or reforeclosure of the mortgage lien becomes |
| 1122 | necessary or required. A failure to give notice to any person |
| 1123 | entitled to notice does not affect the validity of the sale as |
| 1124 | to the interests of any person properly notified. A person |
| 1125 | entitled to notice but not given notice has the rights of a |
| 1126 | person not made a defendant in a judicial foreclosure. Any |
| 1127 | subsequent foreclosure required by failure to notify a party |
| 1128 | under paragraph (6)(b) may be conducted under this section. |
| 1129 | (b) A lienholder may conduct a subsequent foreclosure of a |
| 1130 | timeshare interest to correct any failure to meet the |
| 1131 | requirements of this section before the issuance of a |
| 1132 | certificate of sale under paragraph (8)(f). |
| 1133 | (c) On the issuance of a certificate of sale under |
| 1134 | paragraph (8)(f), all rights of redemption that have been |
| 1135 | foreclosed under this section shall terminate. |
| 1136 | (d) A sale conducted under subsection (8) extinguishes the |
| 1137 | lien and the obligor's liability for all amounts secured by the |
| 1138 | lien. The lienholder has no right to any deficiency judgment |
| 1139 | against the obligor after a sale of the obligor's timeshare |
| 1140 | interest under this section. |
| 1141 | (e) The issuance and recording of the trustee's deed is |
| 1142 | presumed valid and may be relied upon by third parties without |
| 1143 | actual knowledge of irregularities in the sale. |
| 1144 | (10) TRUSTEE'S DEED.- |
| 1145 | (a) The trustee's deed shall include the name and address |
| 1146 | of the trustee, the name and address of the highest bidder, the |
| 1147 | name of the former owner, a legal description of the timeshare |
| 1148 | interest, and the name and address of the preparer of the |
| 1149 | trustee's deed. The trustee's deed shall recite that the |
| 1150 | certificate of compliance was recorded, and shall contain no |
| 1151 | warranties of title from the trustee. |
| 1152 | (b) Ten calendar days after a sale, absent the prior |
| 1153 | filing and service on the trustee of a judicial action to enjoin |
| 1154 | issuance of the trustee's deed to the timeshare interest, the |
| 1155 | trustee shall: |
| 1156 | 1. Cancel the original promissory note executed by the |
| 1157 | mortgagor and secured by the mortgage lien. |
| 1158 | 2. Issue a trustee's deed to the highest bidder. |
| 1159 | 3. Record the trustee's deed in the public records of the |
| 1160 | county or counties in which the timeshare interest is located. |
| 1161 | (c)1. The certificate of compliance and trustee's deed |
| 1162 | together are presumptive evidence of the truth of the matters |
| 1163 | set forth in them, and no action to set aside the sale and void |
| 1164 | the trustee's deed may be filed or otherwise pursued against any |
| 1165 | person acquiring the timeshare interest for value, including any |
| 1166 | subsequent mortgagee or buyer. |
| 1167 | 2. The trustee's deed conveys to the highest bidder all |
| 1168 | rights, title, and interest in the timeshare interest that the |
| 1169 | former owner had, or had the power to convey, at the time of the |
| 1170 | execution of the mortgage, together with all rights, title, and |
| 1171 | interest that the former owner or his or her successors in |
| 1172 | interest acquired after the execution of the mortgage. |
| 1173 | 3. The issuance and recording of a trustee's deed shall |
| 1174 | have the same force and effect as the issuance and recording of |
| 1175 | a certificate of title by the clerk of the court in a judicial |
| 1176 | foreclosure action. |
| 1177 | (11) DISPOSITION OF PROCEEDS OF SALE.- |
| 1178 | (a) The trustee shall apply the proceeds of the sale as |
| 1179 | follows: |
| 1180 | 1. To the expenses of the sale, including compensation of |
| 1181 | the trustee. |
| 1182 | 2. To the amount owed and set forth in the notice as |
| 1183 | required in subparagraph (6)(a)6. |
| 1184 | 3. If there are junior interestholders, the trustee may |
| 1185 | file an action in interpleader, pay the surplus to a court of |
| 1186 | competent jurisdiction, name the competing junior |
| 1187 | interestholders, and ask the court to determine the proper |
| 1188 | distribution of the surplus. In any interpleader action, the |
| 1189 | trustee shall recover reasonable attorney's fees and costs. |
| 1190 | 4. If there are no junior interestholders, or if all |
| 1191 | junior interestholders have been paid, any surplus shall be paid |
| 1192 | to the former owner. If the trustee is unable to locate the |
| 1193 | former owner 1 year after the sale, the surplus, if any, shall |
| 1194 | be deposited with the Chief Financial Officer pursuant to |
| 1195 | chapter 717. |
| 1196 | (b) In disposing of the proceeds of the sale, the trustee |
| 1197 | may rely on the information provided in the affidavit of the |
| 1198 | lienholder under paragraph (2)(c) and, in the event of a dispute |
| 1199 | or uncertainty over such claims, the trustee has the discretion |
| 1200 | to submit the matter to adjudication by court, by interpleader, |
| 1201 | or otherwise and shall recover reasonable attorney's fees and |
| 1202 | costs. |
| 1203 | (12) JUDICIAL FORECLOSURE ACTIONS.-The nonjudicial |
| 1204 | foreclosure procedure established in this section does not |
| 1205 | impair or otherwise affect the lienholder's continuing right to |
| 1206 | bring a judicial foreclosure action, in lieu of using the |
| 1207 | nonjudicial foreclosure procedure, with respect to any mortgage |
| 1208 | lien. |
| 1209 | (13) ACTIONS FOR FAILURE TO FOLLOW THE NONJUDICIAL |
| 1210 | FORECLOSURE PROCEDURE.-An action for actual damages for a |
| 1211 | material violation of this section may be brought by an obligor |
| 1212 | against the lienholder for the failure to follow the nonjudicial |
| 1213 | foreclosure procedure contained in this section. |
| 1214 | Section 10. Subsection (1) of section 721.86, Florida |
| 1215 | Statutes, is amended to read: |
| 1216 | 721.86 Miscellaneous provisions.- |
| 1217 | (1) In the event of a conflict between the provisions of |
| 1218 | this part and the other provisions of this chapter, chapter 702, |
| 1219 | or other applicable law, the provisions of this part shall |
| 1220 | prevail The procedures in this part must be given effect in the |
| 1221 | context of any foreclosure proceedings against timeshare estates |
| 1222 | governed by this chapter, chapter 702, chapter 718, or chapter |
| 1223 | 719. |
| 1224 | Section 11. This act shall take effect upon becoming a |
| 1225 | law. |