Florida Supreme Court Clears Up Timeframe to Claim Surplus Funds from Foreclosure
Earlier this month, Florida’s Supreme Court clarified that the 60-day period to claim surplus funds from judicial foreclosure sales begins from the county clerk’s issuance of the certificate of disbursements, not from when the property is actually sold at auction. In Bank of New York Mellon v. Glenville, Docket No. SC17-954, 2018 WL 4327881 (Fla. Sept. 6, 2018), the Court considered whether a bank had timely filed its claim for surplus funds when it filed the claim 62 days after the public auction, but only 35 days after the clerk issued the certificate of disbursements. In taking up the case, the Court set out to resolve a conflict between Florida’s Second and Fourth District Courts of Appeal over whether the 60-day period began to run upon the public auction of the property, the clerk’s issuance of the certificate of title, or another event.
The Court ultimately concluded that neither the public auction nor the issuance of the certificate of title would start the clock to claim surplus funds; rather, the period would begin when the clerk issued the certificate of disbursements. The Court reasoned that this interpretation best harmonized the statutory framework regarding judicial foreclosure sales, and ensures that the 60-day period will begin only after (1) the sale has been confirmed through the issuance of the certificate of title and (2) the actual surplus amount has been determined.
The Court’s ruling provides much-needed clarity in judicial foreclosure proceedings, and establishes a statewide, uniform standard for when to assert claims to surplus funds. In light of the Court’s decision, subordinate lienholders and other potential claimants should look carefully for the clerk’s issuance of the certificate of disbursement, so as to not miss out on any right to surplus funds.