Jury trial waiver provisions are likely unnecessary for foreclosure actions. It is well-settled under Florida law that mortgage foreclosures are actions in equity, and therefore do not entitle a party to a jury trial. A recent decision by the Fourth District Court of Appeal makes clear that jury trials are also not proper even when the lender includes a cause of action for breach of the promissory note in its foreclosure case.In Kinney v. Countrywide Home Loans Servicing, L.P., the borrowers argued on appeal that the trial court erred in ruling that the borrowers were not entitled to a jury trial because the lender sued both to foreclose the mortgage and for breach of the promissory note. They asserted that because the action on the note was one at law (as opposed to one in equity), they should be afforded a jury trial right.
Considering that actions in equity do not warrant a jury trial but actions at law do, Florida’s Fourth District Court of Appeals posed: “These two principles beg the question: what happens when a lender sues simultaneously on a mortgage and note?” In such a case, the appellate court explained that the lender’s remedy on the promissory note is not necessarily one at law. Instead, following a foreclosure sale, the lender recovers on the promissory note by seeking the equitable relief of a deficiency judgment. Thus, the answer, according to the court, is that the borrowers in that case were not entitled to demand a jury trial because of the overlapping nature of the legal and equitable remedies when a lender seeks both foreclosure and a judgment on the note.
While this decision is good news for lenders bringing an action for both foreclosure and breach of note, it indicates that a lender suing on a promissory note alone will likely be subjected to a jury trial demand, and thus jury trial waiver provisions may still be necessary in that scenario.
