HB 799

1
A bill to be entitled
2An act relating to nonjudicial foreclosure of commercial
3real property; creating chapter 52, F.S., relating to
4nonjudicial foreclosure of commercial real property;
5providing a short title; providing for applicability of
6provisions; providing definitions; providing for
7appointment of a trustee; providing for trustee initiation
8of foreclosure of mortgage liens; providing for objections
9by obligors; providing for redemption of property;
10providing requirements to be met before encumbered
11property may be sold by trustee; providing for notice of
12default and intent to foreclose; providing for notice and
13manner of sale; specifying the effect of a sale; providing
14for a trustee's certificate of compliance and deed;
15providing for disposition of sale proceeds; providing that
16provisions concerning the trustee foreclosure procedure do
17not impair or otherwise affect a foreclosing creditor's
18right to bring a judicial foreclosure action; providing
19for civil actions against foreclosing creditors for
20material failure to follow trustee foreclosure procedures;
21providing criminal penalties for a trustee who
22intentionally violates provisions concerning the trustee
23foreclosure procedure; providing for construction;
24providing for application of provisions to mortgage liens
25existing prior to the effective date of this act for which
26a foreclosure proceeding has not commenced; providing a
27directive to the Division of Statutory Revision; providing
28an effective date.
29
30Be It Enacted by the Legislature of the State of Florida:
31
32     Section 1.  Chapter 52, Florida Statutes, consisting of
33sections 52.101, 502.102, 52.103, and 52.104, is created to
34read:
35
CHAPTER 52
36
NONJUDICIAL FORECLOSURE OF COMMERCIAL REAL PROPERTY
37     52.101  Short title; applicability.-
38     (1)  This chapter may be cited as the "Nonjudicial
39Foreclosure of Commercial Real Property Act."
40     (2)  In lieu of any other foreclosure remedy that may be
41available under the laws of this state within the judicial
42system, this chapter may, at the option of the foreclosing
43creditor, be used to effect a foreclosure of a security
44instrument in commercial real property. However, if the
45foreclosing creditor does not elect to use this chapter to
46effect a foreclosure, this chapter does not modify any other
47foreclosure remedy available to the foreclosing creditor under
48the laws of this state.
49     52.102  Definitions.-As used in this chapter, the term:
50     (1)  "Commercial real property" means real property that,
51when a security instrument is entered into, is used or is
52intended by its owner to be used other than for the personal,
53family, or household purposes of its owner. Residential real
54property on which the borrower resides is deemed commercial if
55it is improved, or is intended by its owner to be improved, to
56have more than four additional dwelling units.
57     (2)  "Debtor" means a person who is obligated, primarily or
58secondarily, on an obligation secured in whole or in part by
59commercial real property.
60     (3)  "Foreclosing creditor" means a secured creditor who is
61engaged in a foreclosure under this chapter.
62     (4)  "Interest holder" means a person who holds a
63possessory interest, other than a leasehold interest with a
64duration of 1 year or less, in nonresidential real property in
65which a security interest exists.
66     (5)  "Junior interest holder" means a person who owns a
67legally recognized interest in real or personal property that is
68subordinate in priority to a security interest foreclosed under
69this chapter.
70     (6)  "Nonresidential real property" means commercial real
71property.
72     (7)  "Obligor" means a person who owes payment or other
73performance of an obligation, whether absolute or conditional,
74primary or secondary, secured under a security instrument,
75whether or not the security instrument imposes personal
76liability on the obligor. The term does not include a person
77whose sole interest in the property is a security interest.
78     (8)  "Personalty and fixtures" means any personal property
79or fixtures located on or within or affixed to a commercial real
80property and pledged as collateral for the credit facility in
81default. To the extent the lender has a perfected security
82interest in such collateralized personalty and fixtures, such
83property shall be encompassed by the term "commercial real
84property" and the security interest in such property shall be
85foreclosed in the manner set forth in this chapter.
86     (9)  "Real property" means any estate or interest in, over,
87or under land, including minerals, structures, fixtures, and
88other things that by custom, usage, or law pass with a
89conveyance of land though not described or mentioned in the
90contract of sale or instrument of conveyance. The term includes
91the interest of a landlord or tenant and, unless under the law
92of the state in which the property is located that interest is
93personal property, an interest in a common interest community.
94     (10)  "Secured creditor" means a creditor that has the
95right to foreclose a security interest in real property under
96this chapter.
97     (11)  "Security instrument" means a mortgage, deed of
98trust, security deed, contract for deed, agreement for deed,
99land sale contract, lease creating a security interest, or other
100contract or conveyance that creates or provides for an interest
101in real property to secure payment or performance of an
102obligation, whether by acquisition or retention of a lien, a
103lessor's interest under a lease, or title to the real property.
104A security instrument may also create a security interest in
105personal property. If a security instrument makes a default
106under any other agreement a default under the security
107instrument, the security instrument includes the other
108agreement. The term includes any modification or amendment of a
109security instrument, and includes a lien on real property
110created by a record to secure an obligation owed by an owner of
111the real property to an association in a common interest
112community or under covenants running with the real property.
113     (12)  "Security interest" means an interest in real or
114personal property that secures payment or performance of an
115obligation.
116     (13)  "Trustee" means an attorney who is a member in good
117standing of The Florida Bar and who has been practicing law for
118at least 5 years or that attorney's law firm, or a title insurer
119who is authorized to transact business in this state under s.
120624.401 and who has been authorized to transact business for at
121least 5 years.
122     52.103  Procedure for trustee foreclosure of mortgage
123lien.-This section establishes a trustee foreclosure procedure
124for mortgage liens and security interests in personalty and
125fixtures collateralizing the same obligation for which the
126mortgage was given.
127     (1)  APPOINTMENT OF TRUSTEE.-
128     (a)  A trustee or a substitute trustee may be appointed by
129a foreclosing creditor at any time by recording a notice of
130appointment of trustee or notice of substitution of trustee in
131the official records of the county or counties in which the
132commercial real property is located. A foreclosing creditor may
133appoint multiple trustees in a single appointment and any
134appointed trustee may be used by the foreclosing creditor
135regarding the trustee foreclosure of any mortgage lien.
136     (b)  A trustee shall use good faith, skill, care, and
137diligence in discharging all of the trustee duties under this
138section and shall deal honestly and fairly with all parties.
139     (c)  The recorded notice of appointment of trustee or
140notice of substitution of trustee shall contain the name and
141address of the trustee or substitute trustee and the name and
142address of the foreclosing creditor.
143     (2)  INITIATING TRUSTEE FORECLOSURE OF MORTGAGE LIENS.-
144     (a)  Before initiating the trustee foreclosure against
145commercial real property, the mortgage or an amendment to a
146mortgage executed by the obligor before the effective date of
147this section must contain a statement in substantially the
148following form:
149
150If the mortgagor (which term shall include the original
151mortgagor's successors or assigns) fails to make timely
152payments under the obligation secured by this mortgage, or
153is otherwise deemed in uncured default of this mortgage,
154the lien against the mortgagor's commercial real property
155created by this mortgage may be foreclosed in accordance
156with either a judicial foreclosure procedure or a trustee
157foreclosure procedure and may result in the loss of your
158commercial real property. If the mortgagee initiates a
159trustee foreclosure procedure, the mortgagor has the option
160to object and the mortgagee may proceed only by filing a
161judicial foreclosure action.
162
163     (b)  In order to initiate a trustee foreclosure procedure
164against commercial real property, the foreclosing creditor shall
165deliver to the trustee an affidavit sworn to, under penalties of
166perjury, by the creditor that identifies the obligor, the notice
167address of the obligor, the commercial real property, the
168official records book and page number in which the mortgage is
169recorded, the personalty and fixtures and the information
170regarding perfection of the security interest in such property,
171and the name and notice address of any holder of a junior
172interest in any collateral subject to foreclosure. The affidavit
173shall be accompanied by a title search of the commercial real
174property identifying any junior interest holders of record and a
175lien search, and the effective date of the title search and the
176lien search must be a date that is within 60 calendar days
177before the date of the affidavit. The affidavit shall also:
178     1.  State the facts that establish that the obligor has
179defaulted in the obligation to make a payment under a specified
180provision of the mortgage or is otherwise deemed in uncured
181default under a specified provision of the mortgage.
182     2.  Specify the amounts secured by the lien as of the date
183of the affidavit and a per diem amount to account for further
184accrual of the amounts secured by the lien.
185     3.  State that the appropriate amount of documentary stamp
186tax and intangible taxes has been paid upon recording of the
187mortgage or otherwise paid to the state.
188     4.  State that the foreclosing creditor is the holder of
189the note and has complied with all preconditions in the note and
190mortgage to determine the amounts secured by the lien and to
191initiate the use of the trustee foreclosure procedure.
192     (3)  OBLIGOR'S RIGHTS.-
193     (a)  The obligor may object to the foreclosing creditor's
194use of the trustee foreclosure procedure for a specific default
195within 15 business days after receipt of notice by sending a
196written objection to the trustee using the objection form
197provided for in subsection (5), and the foreclosing creditor may
198proceed thereafter only with a judicial foreclosure action as to
199that specified default.
200     (b)  At any time before the trustee issues the certificate
201of sale under paragraph (7)(f), the obligor may redeem the
202commercial real property by paying the amounts secured by the
203lien in cash or certified funds to the trustee. After the
204trustee issues the certificate of sale, there is no right of
205redemption.
206     (4)  CONDITIONS TO TRUSTEE'S EXERCISE OF POWER OF SALE.-A
207trustee may sell an encumbered commercial real property
208foreclosed under this section if:
209     (a)  The trustee has received the affidavit from the
210foreclosing creditor under paragraph (2)(b).
211     (b)  The trustee has not received a written objection to
212the use of the trustee foreclosure procedure under paragraph
213(3)(a).
214     (c)  The commercial real property was not redeemed under
215paragraph (3)(b).
216     (d)  There is no lis pendens recorded and pending against
217the same commercial real property.
218     (e)  The trustee is in possession of the original
219promissory note and all renewals, modifications, or other
220renegotiations thereof then in effect executed by the mortgagor
221and secured by the mortgage lien.
222     (f)  The trustee has provided written notice of default and
223intent to foreclose as required under subsection (5) and a
224period of at least 30 calendar days has elapsed after the notice
225is deemed perfected under subsection (5).
226     (g)  The notice of sale required under subsection (6) has
227been recorded in the official records of the county in which the
228mortgage was recorded.
229     (5)  NOTICE OF DEFAULT AND INTENT TO FORECLOSE.-
230     (a)  In any foreclosure proceeding under this section, the
231trustee is required to notify the obligor of the proceeding by
232sending the obligor a written notice of default and intent to
233foreclose to the notice address of the obligor by certified
234mail, commercial delivery service, or delivery service permitted
235by the agreement between the mortgagor and the mortgagee, return
236receipt requested, and by first-class mail or permitted delivery
237service, postage prepaid, as follows:
238     1.  The notice of default and intent to foreclose shall
239identify the obligor, the notice address of the obligor, the
240legal description of the commercial real property, the nature of
241the default, the amounts secured by the lien, and a per diem
242amount to account for further accrual of the amounts secured by
243the lien and shall state the method by which the obligor may
244cure the default, including the period of time after the date of
245the notice of default and intent to foreclose within which the
246obligor may cure the default.
247     2.  The notice of default and intent to foreclose shall
248include an objection form with which the obligor can notify the
249trustee that the obligor objects to the use of the trustee
250foreclosure procedure by signing and returning the objection
251form to the trustee. The objection form shall identify the
252obligor, the notice address of the obligor, the commercial real
253property, and the return address of the trustee and shall state:
254
255The undersigned obligor exercises the obligor's right to
256object to the use of the trustee foreclosure procedure
257contained in section 52.103, Florida Statutes.
258
259The objection is not effective unless notarized and sworn to
260under penalty of perjury.
261     3.  The notice of default and intent to foreclose shall
262also contain a statement in substantially the following form:
263
264If you fail to cure the default as set forth in this notice
265or take other appropriate action with regard to this
266foreclosure matter, you risk losing ownership of your
267commercial real property through the trustee foreclosure
268procedure established in section 52.103, Florida Statutes.
269You may choose to sign and send to the trustee the enclosed
270objection form notifying him or her of your objection to
271proceeding nonjudicially. You have the right to cure your
272default in the manner set forth in this notice at any time
273before the trustee's sale of your commercial real property.
274You may be responsible for the difference between the
275amount for which the trustee can sell the property and the
276amount you still owe under the mortgage. A deficiency may
277only be established in a court of law in a proceeding
278separate from the trustee's foreclosure. In any such
279proceeding, you will be allowed to raise the sufficiency of
280the trustee's sale price as a defense to the deficiency.
281
282     4.  The trustee shall also mail a copy of the notice of
283default and intent to foreclose, without the objection form, to
284the notice address of any junior interest holder by certified
285mail, registered mail, or permitted delivery service, return
286receipt requested, and by first-class mail or permitted delivery
287service, postage prepaid.
288     5.  Notice under this paragraph is considered perfected
289upon the trustee receiving the return receipt bearing the
290signature of the obligor or junior interest holder, as
291applicable, within 30 calendar days after the trustee sent the
292notice under this paragraph. Notice under this paragraph is not
293perfected if the notice is returned as undeliverable within 30
294calendar days after the trustee sent the notice, if the trustee
295cannot ascertain from the receipt that the obligor or junior
296interest holder, as applicable, is the person who signed the
297receipt, or if the receipt from the obligor or junior interest
298holder, as applicable, is returned or refused within 30 calendar
299days after the trustee sent the notice.
300     (b)  If the notice required by paragraph (a) is returned as
301undeliverable within 30 calendar days after the trustee sent the
302notice, the trustee shall perform a diligent search and inquiry
303to obtain a different address for the obligor or junior interest
304holder. For purposes of this paragraph, any address known and
305used by the foreclosing creditor for sending regular mailings or
306other communications from the foreclosing creditor to the
307obligor or junior interest holder, as applicable, shall be
308included with other addresses produced from the diligent search
309and inquiry, if any.
310     1.  If the trustee's diligent search and inquiry produces
311an address different from the notice address, the trustee shall
312mail a copy of the notice by certified mail, registered mail, or
313permitted delivery service, return receipt requested, and by
314first-class mail or permitted delivery service, postage prepaid,
315to the new address. Notice under this subparagraph is considered
316perfected upon the trustee receiving the return receipt bearing
317the signature of the obligor or junior interest holder, as
318applicable, within 30 calendar days after the trustee sent the
319notice under this subparagraph. Notice under this subparagraph
320is not perfected if the trustee cannot ascertain from the
321receipt that the obligor or junior interest holder, as
322applicable, is the person who signed the receipt or the receipt
323from the obligor or junior interest holder, as applicable, is
324returned refused. If the trustee does not perfect notice under
325this subparagraph, the trustee shall perfect service as provided
326in paragraph (c).
327     2.  If the trustee's diligent search and inquiry does not
328locate a different address for the obligor or junior interest
329holder, as applicable, the trustee may perfect notice against
330that person as provided in paragraph (c).
331     (c)  If the notice is not perfected under subparagraph
332(a)5. and such notice was not returned as undeliverable, or if
333the notice was not perfected under subparagraph (b)1., the
334trustee may perfect notice by publication in a newspaper of
335general circulation in the county or counties in which the
336commercial real property is located. The notice shall appear at
337least once a week for 2 consecutive weeks. Notice under this
338paragraph is considered perfected upon completion of publication
339as required in this paragraph.
340     (d)  If notice is perfected under paragraph (a), the
341trustee shall execute an affidavit in recordable form setting
342forth the manner in which notice was perfected and attach the
343affidavit to the certificate of compliance set forth in
344subsection (9). The affidavit shall state the nature of the
345notice, the date on which the notice was mailed, the name and
346address on the envelope containing the notice, the manner in
347which the notice was mailed, and the basis for that knowledge.
348     (e)  If notice is perfected under paragraph (b), the
349trustee shall execute an affidavit in recordable form setting
350forth the manner in which notice was perfected and attach the
351affidavit to the certificate of compliance set forth in
352subsection (9). The affidavit shall state the nature of the
353notice, the dates on which the notice was mailed, the name and
354addresses on the envelopes containing the notice, the manner in
355which the notice was mailed, the fact that a signed receipt from
356the certified mail, registered mail, or permitted delivery
357service was timely received, and the name and address on the
358envelopes containing the notice.
359     (f)  If notice is perfected under paragraph (c), the
360trustee shall execute an affidavit in recordable form setting
361forth the manner in which notice was perfected and attach the
362affidavit to the certificate of compliance set forth in
363subsection (9). The affidavit shall include all the information
364contained in either paragraph (d) or paragraph (e), as
365applicable, shall state that the notice was perfected by
366publication after diligent search and inquiry was made for the
367current address for the person, shall include a statement that
368notice was perfected by publication, and shall set forth the
369information required by s. 49.041 in the case of a natural
370person or s. 49.051 in the case of a corporation, whichever is
371applicable. No other action of the trustee is necessary to
372perfect notice.
373     (6)  NOTICE OF SALE.-
374     (a)  The notice of sale shall set forth:
375     1.  The name and notice addresses of the obligor and any
376junior interest holder.
377     2.  The legal description of the commercial real property
378and a list of all personalty and fixtures.
379     3.  The name and address of the trustee.
380     4.  A description of the default that is the basis for the
381foreclosure.
382     5.  The official records book and page numbers in which the
383mortgage is recorded.
384     6.  The amounts secured by the lien and a per diem amount
385to account for further accrual of the amounts secured by the
386lien.
387     7.  The date, location, and starting time of the trustee's
388sale.
389     8.  The right of and the method by which the obligor may
390redeem the collateral or the right of any junior interest holder
391to redeem its interest up to the date the trustee issues the
392certificate of sale in accordance with paragraph (7)(f).
393     (b)  The trustee shall send a copy of the notice of sale
394within 3 business days after the date it is submitted for
395recording by first-class mail or permitted delivery service,
396postage prepaid, to the notice addresses of the obligor and any
397junior interest holder.
398     (c)  After the date of recording of the notice of sale,
399notice is not required to be given to any person claiming an
400interest in the commercial real property except as provided in
401this section. The recording of the notice of sale has the same
402force and effect as the filing of a lis pendens in a judicial
403proceeding under s. 48.23.
404     (d)  The trustee shall publish the notice of sale in a
405newspaper of general circulation in the county or counties in
406which the commercial real property is located at least once a
407week for 2 consecutive weeks before the date of the sale. The
408last publication shall occur at least 5 calendar days before the
409sale.
410     (7)  MANNER OF SALE.-
411     (a)  The sale of foreclosed commercial real property by the
412trustee in a public auction shall be held in the county in which
413the commercial real property is located on the date, location,
414and starting time designated in the notice of sale, which shall
415be after 9 a.m. but before 4 p.m. on a business day not less
416than 30 calendar days after the recording of the notice of sale.
417The trustee's sale may occur online at a specific website on the
418Internet or in any other manner used by the clerk of the court
419for a judicial foreclosure sales procedure in the county or
420counties in which the commercial real property is located.
421     (b)  The trustee shall conduct the sale and may act as the
422auctioneer.
423     (c)  The foreclosing creditor and any person other than the
424trustee may bid at the sale. In lieu of participating in the
425sale, the foreclosing creditor may send the trustee written
426bidding instructions that the trustee shall announce as
427appropriate during the sale.
428     (d)  The trustee may postpone the sale from time to time.
429In such case, notice of postponement must be given by the
430trustee at the date, time, and location contained in the notice
431of sale. The notice of sale for the postponed sale shall be
432mailed as provided in paragraph (6)(b), recorded as provided in
433paragraph (4)(g), and published as provided in paragraph (6)(d).
434The effective date of the initial notice of sale as provided in
435paragraph (6)(b) is not affected by a postponed sale.
436     (e)  The highest bidder of the commercial real property
437shall pay the price bid to the trustee in cash or certified
438funds on the day of the sale. If the foreclosing creditor is the
439highest bidder, the foreclosing creditor shall receive a credit
440in the amount of the high bid up to the amount set forth in the
441notice of sale as provided in subparagraph (6)(a)6.
442     (f)  On the date of the sale and upon receipt of the cash
443or certified funds due from the highest bidder, the trustee
444shall issue to the highest bidder a certificate of sale stating
445that a foreclosure conforming to the requirements of this
446section has occurred, including the time, location, and date of
447the sale, that the foreclosed commercial real property was sold,
448the amounts secured by the lien, and the amount of the highest
449bid. A copy of the certificate of sale shall be mailed by
450certified mail, registered mail, or permitted delivery service,
451return receipt requested, to all persons entitled to receive a
452notice of sale under subsection (6).
453     (g)  Before a sale is conducted pursuant to this
454subsection, a junior interest holder may pursue adjudication by
455court, by interpleader, or in any other authorized manner
456reflecting any matter that is disputed by the junior interest
457holder.
458     (8)  EFFECT OF TRUSTEE'S SALE.-
459     (a)  A sale conducted under subsection (7) forecloses and
460terminates all interests of any person with notice to whom
461notice is given under subsection (5) and paragraph (6)(b), and
462of any other person claiming interests by, through, or under any
463such person, in the affected commercial real property. A failure
464to give notice to any person entitled to notice does not affect
465the validity of the sale as to the interests of any person
466properly notified. A person entitled to notice but not given
467notice has the rights of a person not made a defendant in a
468judicial foreclosure.
469     (b)  Upon issuance of a certificate of sale under paragraph
470(7)(f), all rights of redemption that have been foreclosed under
471this section shall terminate.
472     (c)  The foreclosing creditor may seek a deficiency
473judgment against the debtor in a judicial proceeding subsequent
474to the foreclosure sale. The debtor may raise the adequacy of
475the price obtained at the foreclosure sale as a defense to all
476or part of the deficiency, but has the burden of proof as to the
477alleged inadequacy.
478     (d)  The issuance and recording of the trustee's deed is
479presumed valid and may be relied upon by third parties without
480actual knowledge of any irregularities in the foreclosure
481proceedings. If for any reason there is an irregularity in the
482foreclosure proceedings, a purchaser becomes subrogated to
483rights of the foreclosing creditor to the indebtedness that it
484secured to the extent necessary to reforeclose the mortgage lien
485in order to correct the irregularity and becomes entitled to an
486action de novo for the foreclosure of such mortgage lien. Any
487subsequent reforeclosure required to correct an irregularity may
488be conducted as provided in this section.
489     (9)  TRUSTEE'S CERTIFICATE OF COMPLIANCE.-
490     (a)  Within 10 calendar days after the trustee conducts a
491sale, the trustee shall execute and acknowledge a certificate of
492compliance that:
493     1.  Confirms delivery of the notice of default and intent
494to foreclose and attaches the affidavit required under
495subsection (5).
496     2.  States that the default was not cured, that the trustee
497did not receive any written objection under paragraph (3)(a),
498and that the commercial real property was not redeemed under
499paragraph (3)(b).
500     3.  States that the trustee is in possession of the
501original promissory note executed by the mortgagor and secured
502by the mortgage lien.
503     4.  Confirms that the notice of sale was published as
504required in paragraph (6)(d) and attaches an affidavit of
505publication for the notice of sale.
506     5.  Confirms that the notice of sale was mailed as required
507in paragraph (6)(b) together with a list of the parties to whom
508the notice of sale was mailed.
509     (b)  In furtherance of the execution of the certificate of
510compliance required under this subsection, the trustee may rely
511upon an affidavit or certification from the foreclosing creditor
512as to the facts and circumstances of default and failure to cure
513the default.
514     (10)  TRUSTEE'S DEED.-
515     (a)  The trustee's deed shall include the name and address
516of the trustee, the name and address of the highest bidder, the
517name of the former owner, a legal description of the commercial
518real property, and the name and address of the preparer of the
519trustee's deed. The trustee's deed may not contain any
520warranties of title from the trustee. The certificate of
521compliance shall be attached as an exhibit to the trustee's
522deed.
523     (b)  Ten calendar days after a sale, absent the prior
524filing and service on the trustee of a judicial action to enjoin
525issuance of the trustee's deed to the commercial real property,
526the trustee shall:
527     1.  Cancel the original promissory note executed by the
528mortgagor and secured by the mortgage lien.
529     2.  Issue a trustee's deed to the highest bidder or the
530highest bidder's assignee.
531     3.  Record the trustee's deed in the official records of
532the county or counties in which the commercial real property is
533located.
534     (c)1.  The certificate of compliance and trustee's deed
535together are presumptive evidence of the truth of the matters
536set forth in them, and an action to set aside the sale and void
537the trustee's deed may not be filed or otherwise pursued against
538any person acquiring the commercial real property for value.
539     2.  The trustee's deed conveys to the highest bidder or its
540assignee all rights, title, and interest in the commercial real
541property and personalty and fixtures that the former owner had,
542or had the power to convey, together with all rights, title, and
543interest that the former owner or his or her successors in
544interest acquired after the execution of the mortgage.
545     3.  The issuance and recording of a trustee's deed has the
546same force and effect as the issuance and recording of a
547certificate of title by the clerk of the court in a judicial
548foreclosure action.
549     (11)  DISPOSITION OF PROCEEDS OF SALE.-
550     (a)  The trustee shall apply the proceeds of the sale as
551follows:
552     1.  To the expenses of the sale, including compensation of
553the trustee.
554     2.  To the amount owed and set forth in the notice as
555required under subparagraph (6)(a)6.
556     3.  If there are junior interest holders, the trustee may
557file an action in interpleader, pay the surplus to a court of
558competent jurisdiction, name the competing junior interest
559holders, and ask the court to determine the proper distribution
560of the surplus. In an interpleader action, the trustee shall
561recover reasonable attorney's fees and costs.
562     4.  If there are no junior interest holders, or if all
563junior interest holders have been paid, any surplus shall be
564paid to the former owner. If the trustee is unable to locate the
565former owner within 1 year after the sale, the surplus, if any,
566shall be deposited with the Chief Financial Officer as provided
567in chapter 717.
568     (b)  In disposing of the proceeds of the sale, the trustee
569may rely on the information provided in the affidavit of the
570foreclosing creditor under paragraph (2)(b) and, in the event of
571a dispute or uncertainty over such claims, the trustee has the
572discretion to submit the matter to adjudication by court, by
573interpleader, or in any other authorized manner and shall
574recover reasonable attorney's fees and costs.
575     (12)  JUDICIAL FORECLOSURE ACTIONS.-The trustee foreclosure
576procedure established in this section does not impair or
577otherwise affect the foreclosing creditor's continuing right to
578bring a judicial foreclosure action, in lieu of using the
579trustee foreclosure procedure, with respect to any mortgage
580lien.
581     (13)  ACTIONS FOR FAILURE TO FOLLOW TRUSTEE FORECLOSURE
582PROCEDURE.-
583     (a)  An action for actual damages for a material violation
584of this section may be brought by an obligor against the
585foreclosing creditor for the failure to follow the trustee
586foreclosure procedure contained in this section.
587     (b)  Any trustee who intentionally violates the provisions
588of this section concerning the trustee foreclosure procedure
589commits a felony of the third degree, punishable as provided in
590s. 775.082, s. 775.083, or s. 775.084.
591     52.104  Miscellaneous provisions.-
592     (1)  In the event of a conflict between the provisions of
593this chapter and chapter 702 or other applicable law, the
594provisions of this chapter prevail. The procedures in this
595chapter must be given effect in the context of any foreclosure
596proceedings against commercial real properties governed by this
597chapter, chapter 702, chapter 718, or chapter 719.
598     (2)  In addition to assessment liens and mortgage liens
599arising after the effective date of this act, this chapter
600applies to all mortgage liens existing prior to the effective
601date of this act for which a foreclosure proceeding has not yet
602commenced.
603     Section 2.  The Division of Statutory Revision is directed
604to replace the phrase "the effective date of this act" wherever
605it occurs in this act with the date this act becomes a law.
606     Section 3.  This act shall take effect July 1, 2011.


CODING: Words stricken are deletions; words underlined are additions.