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Filing # 66859840 E-Filed 01/22/2018 04:31:06 PM
IN THE CIRCUIT COURT OF THE
17" JUDICIAL CIRCUIT IN AND FOR
BROWARD COUNTY, FLORIDA
(CIVIL DIVISION)
WELLS FARGO BANK, NA, AS CASE NO.: CACE 17-012278 (11)
TRUSTEE ON BEHALF OF THE
HOLDERS OF STRUCTURED ASSET
MORTGAGE INVESTMENTS II, INC.,
BEAR STEARNS MORTGAGE FUNDING
TRUST 2006-ARS, MORTGAGE
PASS-THROUGH CERTIFICATE SERIES
2006-AR5,
Plaintiff,
vs.
THANYAKORN ATSAWAMAHAKUL,
ET. AL,
Defendants.
NISSIM SHANI; and MICHELE SHANI,
Third-Party Plaintiffs,
vs.
BANK OF AMERICA, N.A.,
Third Party Defendant.
/
BANK OF AMERICA, N.A.’S MOTION TO DISMISS
THE THIRD-PARTY COMPLAINT
Bank of America, N.A. (“BANA”), by and through its undersigned counsel, respectfully
moves this Court for an order dismissing the third-party complaint filed by Third-Party Plaintiffs
Nissim and Michele Shani (the “Shanis”’) on or about October 9, 2017. The third-party complaint
asserts five counts against BANA: (1) breach of contract; (2) breach of contract/deed warranty; (3)
common law fraud; (4) negligent misrepresentation; and (5) fraudulent misrepresentation
(‘Third-Party Complaint”). The Third-Party Complaint should be dismissed with prejudice
LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400
*** FILED: BROWARD COUNTY, FL BRENDA D. FORMAN, CLERK 1/22/2018 4:31:07 PM.****CASE NO.: CACE 17-012278 (11)
because: (1) BANA did not breach the contract or the special warranty deed; (2) the Shanis’ claims
for common law fraud, negligent misrepresentation, and fraudulent misrepresentation do not
allege any facts that would make the claims anything other more than a mere breach of contract
claim; and (3) the Shanis had no reason to rely on representations whose accuracy they could have
ascertained through a search of the public records. In support of this motion, BANA further states
as follows.
MATERIAL ALLEGATIONS
This matter concerns the property commonly known as 1151 N Atlantic Boulevard, Unit
6B Fort Lauderdale, Florida 33304 (the “Property”). BANA and the Shanis entered into a contract
for the sale and purchase of the Property on or about November 25, 2013 (the “Contract’”).
Third-Party Compl. { 6. A special warranty deed was recorded on February 27, 2014 (the “Special
Warranty Deed”). /d. § 8. On June 27, 2017, Wells Fargo Bank, NA, as trustee on behalf of the
holders Of Structured Asset Mortgage Investments II, Inc., Bear Stearns Mortgage Funding Trust
2006-AR5, Mortgage Pass-Through Certificate Series 2006-AR5 (“Wells Fargo”) filed this
instant foreclosure action, which named the Shanis as defendants. Jd. § 10. Wells Fargo is
foreclosing on a November 30, 2006, mortgage with Thanyakorn Atsawamahful (the
“Mortgage”). Id. § 12. The Mortgage was recorded on December 12, 2006, in Book 43258, Page
113, of the Official Records of Broward County. /d. The Shanis allege that BANA did not disclose
the existence of the Mortgage. /d. 14. On these facts, the Shanis assert claims against BANA for
1) breach of contract; 2) breach of contract/deed warranty; 3) common law fraud; 4) negligent
misrepresentation; and 5) fraudulent misrepresentation.
LEGAL STANDARD
A motion to dismiss tests whether the claim has alleged facts that sufficiently state a cause
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LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400CASE NO.: CACE 17-012278 (11)
of action. Bell v. Indian River Mem’! Hosp., 778 So. 2d 1030, 1032 (Fla. 4th DCA 2001).
“Allegations of legal conclusions are not admitted by a motion to dismiss.” Fla. Dep't of Ins. v.
First Floridian Auto & Home Ins. Co., 803 So. 2d 771, 773 (Fla. 1st DCA 2001). Further, a court
has discretion to dismiss a complaint with prejudice if it is not conceivably amendable to sustain a
cause of action under any theory. Robbins v. City of Miami Beach, 664 So. 2d 1150, 1151 (Fla. 3d
DCA 1995).
ARGUMENT
I. BANA Did Not Breach the Contract or the Special Warranty Deed
The Shanis’ claims for breach of contract and for breach of the Special Warranty Deed fail
because BANA did not breach the terms of either. Paragraph 20 of the Contract clearly states: “the
deed to be delivered at closing shall be a deed that covenants that grantor grants only that title that
grantor may have and that grantor will only defend title against persons claiming by, through or
under the grantor, but not otherwise (which deed may be known as a Special Warranty, Limited
Warranty, Quitclaim or Bargain and Sale Deed).” Third-Party Compl. Ex. A. “The special
warranty deed derives its name from the covenant of special warranty which limits the scope of the
warranty covenant to claims arising ‘by, through or under the grantor.’ It is thus distinguished from
the general warranty covenant which warrants against the claims of ‘all persons whomsoever.’
Special warranty deeds are used when the grantor is unwilling to warrant against possible defects
arising before he acquired title. Harris v. Sklarew, 166 So. 2d 164, 166 (Fla. 3d DCA 1964).
Here, BANA issued a Special Warranty Deed to the Shanis, pursuant to the terms of the
Contract. BANA, by executing a Special Warranty Deed, did not warrant against possible defects
arising before it acquired title. BANA acquired title to the property through an indenture on
November 26, 2013, which was recorded on February 27, 2014, in Book 50580, Page 467, of the
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LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400CASE NO.: CACE 17-012278 (11)
Official Records of Broward County. Ex. A. As a matter of law, when BANA executed the Special
Warranty Deed to the Shanis on January 28, 2014, it made no warranties to the Shanis with respect
to any defects in title that may have existed before November 26, 2013. The encumbrance that the
Shanis claim to cloud their title is a mortgage dated November 30, 2006, and recorded on
December 12, 2006, in Book 43258, Page 113, of the Official Records of Broward County. That
encumbering mortgage predates BANA’s title to the Property by eight years.
Furthermore, any covenants regarding the defects in title merged with the deed accepted by
the Shanis and were thereby extinguished. The doctrine of merger precludes any claims based on
preliminary agreements and understandings that were made or existed before the execution of the
deed. E.g., Fraser v. Schoenfeld, 364 So. 2d 533, 534 (Fla. 3d DCA 1978); Sager v. Turner, 402
So. 2d 1282, 1283 (Fla. 4" DCA 1981) (citations omitted); Fleischer v. Hi-Rise Homes, Inc., 536
So. 2d 1105, 1106-07 (Fla. 4" DCA 1988) (citations omitted). Here, the warranty that the Shanis
complain of relates to an alleged title defect. Such title-related warranty merged with the deed
accepted by the Shanis on or about February 21, 2014. The Shanis had constructive notice of the
Wells Fargo mortgage because it was recorded on December 12, 2006. See U.S. Bank Nat'l Ass'n v.
Bevans, 138 So. 3d 1185, 1188-89 (Fla. 3d DCA 2014); De Sousa v. JP Morgan Chase, N.A., 170
So. 3d 928, 930 n. 1 (Fla. 4" DCA 201 5). Additionally, the Shanis executed a Real Estate Purchase
Addendum that they attached to the third-party complaint as Composite Exhibit A. In that
addendum, the Shanis acknowledge that representations and covenants relating to title defects do
not survive the closing and that, upon delivery of the deed, BANA shall be discharged of all its
obligations under the purchase agreement and the addendum. See Addendum ff 20, 21, 29.
The Shanis had knowledge of the Wells Fargo mortgage. The Shanis and BANA intended
the title warranties to be merged with—and be extinguished upon execution and delivery of—the
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LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400CASE NO.: CACE 17-012278 (11)
deed. Therefore, the Shanis are precluded from raising against BANA any claim related to the
Wells Fargo mortgage. Fraser, 364 So. 2d at 534 (stating that, where purchaser knows of claimed
violations, he is precluded from suit by the merger doctrine). Accordingly, BANA did not warrant
any possible defects prior to acquiring title, such alleged defects merged with the deed, and the
Shanis are precluded from claiming a breach against BANA. As such, the Shanis’ claims for
breach of contract and breach of warranty deed fail, as a matter of law, and should be dismissed
with prejudice.
II. The Shanis Do Not Allege Any Facts That Would Make The Claims Anything
Other Than A Mere Breach of Contract Claim
The Shanis’ claims for common law fraud, negligent misrepresentation, and fraudulent
misrepresentation fail because they do not allege any facts that would make the claims anything
other than a mere breach of contract claim, which is already alleged in the Third-Party Complaint
as counts one and two. “Where damages sought in tort are the same as those for breach of contract,
a plaintiff may not circumvent the contractual relationship by bringing an action in tort.” Tiara
Condo. Ass'n v. Marsh & McLennan Cos., 110 So. 3d 399, 402 (Fla. 2013) (emphasis added).
When the parties are in privity, contract principles are generally more appropriate for determining
remedies for consequential damages that the parties have, or could have, addressed through their
contractual agreement. Jd. Accordingly, a tort action is barred where a defendant has not
committed a breach of duty apart from a breach of contract. Jd.
Here, the Shanis’ tort actions are barred because the Shanis have failed to establish that
BANA has committed a wrong apart from an alleged breach of contract. In fact, the Shanis admit
that their common-law fraud claim is based on representations made “[i]n the Contract and the
Deed.” Third-Party Compl. § 31. Similarly, the negligent misrepresentation and the fraudulent
LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400CASE NO.: CACE 17-012278 (11)
misrepresentation claims are based on representations contained in “Section 18.H of the Contract.”
Id. §§ 40, 48. Further, the Shanis cannot circumvent their contractual relationship with BANA by
bringing tort claims that are based on the contents of a written agreement. As such, the Shanis’
common law fraud, negligent misrepresentation, and fraudulent misrepresentation claims should
be dismissed with prejudice.
III. The Shanis Had No Reason to Rely on Representations Whose Accuracy They
Could Have Ascertained Through A Search of The Public Records
The Shanis purchased the Property subject to all liens. “It is fundamental that a purchaser
of an interest in land is chargeable with notice of liens, conveyances, contracts or judicial
proceedings affecting the ownership or title thereto as disclosed by official records and such
purchaser takes title subject to the above encumbrances which are reflected in the public records.”
Feemster v. Schurkman, 291 So. 2d 622, 626 (Fla. 3d DCA 1974). The Mortgage was recorded on
December 12, 2006, in Book 43258, Page 113, of the Official Records of Broward County.
Third-Party Compl. § 12. The Shanis purchased the Property on or around November 25, 2013,
nearly 8 years after the Mortgage was recorded. /d. 12. The Shanis had constructive notice of the
recorded Mortgage. Therefore, the Shanis had no reason to rely on any representations.
Accordingly, the Shanis’ common law fraud, negligent misrepresentation, and fraudulent
misrepresentation claims should be dismissed with prejudice.
CONCLUSION
WHEREFORE, Bank of America, N.A., respectfully requests this Court to enter an order
dismissing the Shanis’ Third-Party Complaint, and grant any further relief that this Court deems
just and proper.
LIEBLER, GONZALEZ & PORTUONDO
Attorneys for Bank of America, N.A.
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LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400CASE NO.: CACE 17-012278 (11)
Courthouse Tower - 25" Floor
44 West Flagler Street
Miami, FL 33130
(305) 379-0400
service@|gplaw.com
By:4s/ Neda Ghomeshi
ARIEL ACEVEDO
Florida Bar No. 946001
NEDA GHOMESHI
Florida Bar No. 123554
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 22" day of January, 2018, I electronically filed the
foregoing with the Clerk of Courts by using the Florida Courts E-filing Portal which will send a
notice of electronic filing to the following: Misty Sheets, Esquire
(msheets@ gladstonelawgroup.com), Attorneys for Plaintiff, 1515 South Federal Highway, Suite
100, Boca Raton, Florida 33432, Andrea L. Pearl, Esquire (apearl@katzmanchandl
er.com),
Katzman Chandler, Attorneys for Defendant Park Tower Association, Inc., 1500 W. Cypress
Creek Road, Suite 408, Ft. Lauderdale, FL 33309, Peter L. Meltzer, Esquire
anlewis.com), John A. Moore, Esquire (jmoore pathmanlewis.com),
Pathman Lewis, LLP, Attorneys for Defendants and Third Party Plaintiffs, Shani, 2 South
Biscayne Boylevard, Suite 2400, Miami, FL 33131.
/s/ Neda Ghomeshi
NEDA GHOMESHI
(pmelizer@pathm
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LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400CASE Ni
CACE 17-012278 (11)
Exhibit “A”
LIEBLER, GONZALEZ & PORTUONDO
Courthouse Tower - 25" Floor, 44 West Flagler Street, Miami, FL 33130 (305) 379-0400INSTR # 112127552, OR BR 86580 Po! 467; Page 1 of 1, Recorded 02/27/2014) at
09:17 AM, Broward County Commission, Doc. D: $0.70 Deputy Clerk 3405°
ee
\
THIS INDENTURE between FIRST MAGNUS FINANCIAL CORP., whose address is 2900 N MADERA
ROAD, SIMI VALLEY, CA 93065, party of the first part, and, BANK OF AMERICA, N.A., whose address is 2900
N MADERA ROAD, SIMI VALLEY, CA 93065, party of the second part.
THAT the said party of the first part, for and in consideration of the sum of TEN AND NO/100 ($10.00)
DOLLARS, to it in band paid by the said party of the second part, the receipt whereof is hereby acknowledged, has
granted, bargained and sold to the said party of the second part, and its assigns forever, the following-described land,
to-wit:
APARTMENT NO. 6-B OF PARK TOWER CONDO AND PARKING SPACE 34, A
CONDOMINIUM, ACCORDING TO THE DECLARATION OF CONDOMIMINIUM
THEREOF, AS RECORDED IN OFFICIAL RECORDS BOOK 3224, AT PAGE 874, OF
THE PUBLIC RECORDS OF BROWARD COUNTY, FLORIDA, TOGETHER WITH AN
UNDIVIDED INTEREST IN THE COMMON ELEMENTS APPURTENANT THERETO
AND ALL AMENDMENTS THERETO AS SET FORTH IN SAID DECLARATION, AS
AMENDED
FOLIO NUMBER: 494331-AA-0220
SUBJECT TO: Real estate taxes for 2012 and subsequent years;
Conditions, restrictions, limitations and easements of record;
TO HAVE AND TO HOLD the same unto the said party of the second part in fee simple.
AND the said party of the first part does hereby covenant with the said party of the second part that, except as
above noted, that at the time of the delivery of this deed the premises were free from all encumbrances made by it, and
that it will warrant and defend the same against the lawful claims and demands of all persons claiming by, through or
under it, but against none other.
Dated this ee. day of ot _Nevewbien= ~~ 20%
Signed, ea Deli of ur Presence:
AN a FIRST MAGNUS FINANCIAL CORP jby Tonstee of the Bet
Witness Signature od
Printed Name, [Brien MH. ae By: Ags Lignid ih Trust
SIGNATURE 7
Printed Name: Ms.
itnes: ture
‘
Printed name: MA Ce 2o8 sy
(Affix Corporate Seal)
STATE OF
county or_ Meri eopa>
‘The foregoing instrument was acknowledged before me this Zo ss day of NM a (em bo :
2013, by CAAS Uglter. for and on behalf of FIRST MAGNUS FINANCIAL
CORP, (xGho is personally known to me or () produced as identification.
PAMELA SMEDLEY
dyule Smells “aneee
NOTARY PUB) q ‘september 8.2017
STATE OF. 2A
MY COMMISSION EXPIRES: Q-$-24/7 PREPARED BY AND RETURN TO: LINDA SURRETT
COMMISSION NO.: ‘TITLE DEPARTMENT
U4 4950 New House Title LL.C.
4919 Memorial Highway, Suite 200
Tampa, Florida 33634
CHI PENG TAN
F 10027603