Loading...
Minutes 05-17-10 MINUTES OF THE CODE COMPLIANCE BOARD LIEN REDUCTION MEETING HELD ON 'NEDNESDAY, MONDAY, MAY 17, 2010, AT 4:00 P.M., IN THE COMMISSION CHAMBERS, CITY HALL, BOYNTON BEACH, FLORIDA PRESENT: Michelle Costantino, Chair Richard Yerzy, Vice Chair James Brake Robert Foot Jamie LaTour Kathleen Carroll, Alternate Scott Blasie, Code Compliance Administrator James Cherof, City Attorney ABSENT: Mark Karageorge Kirk LaRock I. Call to Order Chair Costantino called the meeting to order at 4:00 p.m. II. Approval of Agenda Motion Mr. LaTour moved to approve. Ms. Carroll seconded the motion that passed unanimously. III. Swearing in of Witnesses and Introduction Attorney Cherof explained the hearing procedures and administered the oath to all who would be testifying. IV. New Business Case #09-1881 Dushyant & Jashminiben Patel 930 Chapel Hill Boulevard Scott Blasie, Code Compliance Administrator, explained this case pertained to two liens on one property. The violations pertained to securing an unsanitary pool and overgrowth. 1 Meeting Minutes Code Compliance Board Boynton Beach, FL May 17, 2010 The property was in foreclosure and a short sale was pending. The property owner of record was Dushyant and Jashminiben Patel. Kenny Patel, the applicant’s brother was present on his behalf. The property was a vacant property. Mr. Blasie explained one case was against the bank and the other against the property owner. Mr. Blasie had four photographs taken on May 13th. Other photographs presented to the Board were dated September 10th, and 11th of 2008, which depicted the general condition of the property for the period of time between the two cases. Kenny Patel, residing at 104 Westwood Court, Atlantis, was the Respondent’s brother. Mr. Patel advised he was authorized to speak on his brother’s behalf. Motion Vice Chair Yerzy moved both cases be combined. Mr. Foot disagreed on the basis there were different defendants, one of which was not present. Vice Chair Yerzy withdrew his motion. Mr. Patel explained his brother owned properties and he had to forego them. He had maintained the premises until the Bank of America changed the locks on the Chapel Hill Boulevard property. Since that time, the Respondent thought the Bank was responsible for maintaining the premises. A neighbor advised the property was posted and the grass needed to be cut. Accordingly, Mr. Patel sent someone to mow the grass and he explained had his brother been aware he had to maintain the property, he would have. The Respondent had other properties, also in foreclosure. The property at 930 Chapel Hill Boulevard was under contract for sale to a police officer. The Bank accepted the price and the Respondent needed the lien to be removed before they could proceed. Three other properties were under contract, including his homestead. One property would close next month, but they could not proceed due to the lien. Mr. Patel produced paperwork regarding the liens on the property. Chair Costantino inquired if the Respondent was in charge of the property on June 17, 2009. Mr. Patel repeated Bank of America had changed the locks and his brother requested the keys through an attorney he hired to handle a short sale; however, the bank did not respond. He received a notice from the law firm of Marshall Watson advising the property at 930 Chapel Hill Boulevard would be foreclosed on May 28, 2010. The Bank then realized the property was up for sale and had offers. An adjustment was made indicating if the sale did not occur they would foreclose on it as scheduled. 2 Meeting Minutes Code Compliance Board Boynton Beach, FL May 17, 2010 Mr. Patel had copies of his brother’s bank account. Once the house where his brother was currently living, which was his homestead was closed on, he would have to reside somewhere else and he would need money for the first, last and security deposits. His financial situation was dire. The Respondent hoped if the lien was removed he could sell four of the properties, which were currently under contract. Mr. Patel advised someone would be sent to cut the grass every two weeks. Mr. Blasie advised the Bank took care of the pool, the last mowing and the properties were currently in compliance based on the Bank’s efforts. Mr. Patel paid the mowing charges, the outstanding water bill plus the Lien Reduction Application fee. Mr. Blasie explained the property was in the pre-foreclosure process and the Notice of Lis Pendens was filed. He was curious about the changing of the locks because typically the Bank needed a Writ of Possession and had to obtain the property in order to do so. The Bank was cited to register the property and, under the Registration Ordinance, they were responsible for maintaining the property. In this case, they were to secure the pool and mow the yard. The total mortgages on the property were $105,000 to Bank of America plus interest and fines for the last two years. The second mortgage was a line of credit of $200,000 or $250,000, plus the fines and legalities involved. The short sale was for $160,000. The property was listed with Boynton Beach Realty. Mr. Patel had spoken with Mr. Mike Biddelman who advised the Bank would receive all their money. The second mortgage holder would receive under $8,000. Attorney Cherof advised absent a reduction of release of the lien, the lien would survive through the foreclosure proceeding, but he was unsure the City was a party to the foreclosure. Mr. Foot inquired with a short sale whether the buyer would obtain the property with the lien still in place. Attorney Cherof advised if the City was listed as a defendant in the Bank’s foreclosure, the monies would be wiped out. The buyer would obtain the property free and clear of the lien. If the City was not a party to the foreclosure, the lien would survive and the buyer would obtain the property subject to the lien. Mr. Foot inquired if the City continued with the lien whether it would jeopardize the sale. Attorney Cherof responded it was more likely to influence the seller’s ability to come away with a little cash as often occurs with a short sale. He noted Mr. Patel had previously testified the sale would provide some cash to his brother. Mr. Patel explained the first mortgage was with Bank of America. The second loan was with CitiBank. Mr. Biddelman advised Mr. Patel, CitiBank was concerned they would 3 Meeting Minutes Code Compliance Board Boynton Beach, FL May 17, 2010 only receive $8,000 out of the $200,000 to $250,000; however, Bank of America would recover their original principal. Attorney Cherof inquired about the pending foreclosure on May 28 and asked if the letter advised the foreclosure would commence or there was a foreclosure sale scheduled. Mr. Patel responded the Bank had a foreclosure notice filed with the County. Attorney Cherof commented based on the documents presented, and the one titled Memorandum of Law in Opposition to the Motion to Dismiss, the City of Boynton Beach was not named as a named defendant in the action and it was unlikely, based on the way the document was written, that the City was served with the foreclosure. As to Mr. Foot’s questions, the City's lien would survive the foreclosure based on the one document. As to the other documents pertaining to the other properties, Attorney Cherof explained they only indicated Patel, et al, and he could not ascertain whether the City was listed or not. As a result, it was difficult to determine the City's rights following the foreclosure. Mr. Foot suggested considering a $5,000 fine plus administrative costs, totaling about $6,300. Mr. Foot felt that amount would not kill the sale and it was appropriate for the public's interest in terms of deterring these types of situations. Mr. Patel pointed out when the notice from the City's Code Compliance Office was delivered to him, they complied and they maintained the property until the time the Bank changed the keys. If the lien was not dismissed, Bank of America would foreclose on the property, and the buyer with the current offer would not get the house. It would be another three or four months before the property was returned to the market plus the Respondent would not be able to sell any other properties. Bank of America did not respond to the Respondent’s letters regarding the key to show the property. The real estate officer opened the homes via the back door to show the property because the Bank remained silent. Mr. Patel asked the Board for leniency. The property was the Respondent’s former residence. He moved from it about five years ago. The Respondent wanted to sell the property, but the market collapsed. A friend stayed in the home to look after the dwelling. An offer of purchase had been received in early 2009; however, the first and second lien holders could not agree. The property was vacant since June 2008 or 2009 and the Respondent was under the impression, since the Bank of America had changed the locks in 2008, that the Bank was responsible. The Respondent’s attorney advised since the locks were changed, there was a foreclosure action filed on the property since 2008. 4 Meeting Minutes Code Compliance Board Boynton Beach, FL May 17, 2010 Attorney Cherof advised there were not enough facts available to justify a lien reduction. He clarified that information may be available, but he did not think it was presented to the Board. He opined that that if a Boynton Beach Police Officer had a contract to purchase the property, they should be present to testify about it. He recommended tabling the matter to the next regular meeting, or to a date certain in order to accommodate the sale, so all of the involved parties could present the facts. A special meeting may be needed for the lien reduction. Mr. Foot suggested addressing the matter at the next meeting. He further inquired if the City were not a party to the foreclosure whether the lien would survive the short sale and whether the prior owner would be responsible for the obligation. Attorney Cherof responded not on this property, but it could remain on the other properties. There were not enough facts presented. Normally, the City would make contact with the attorney for the Bank and the potential buyer(s) to work out the details of the transaction to bring back to the Board that would justify a reduction or release of lien. Mr. Patel explained it would be difficult to obtain an answer from the bank by the next meeting. He advised he would ask the real estate officer to testify then and he agreed to have the buyer, and the title company with the Bank of America present so the City Attorney could review the information. Attorney Cherof agreed to contact the attorney from Marshall Watson and invite them to testify about their interest and answer questions. He also agreed to work with the applicant to try to resolve the matter. There was a question that if the Board released the lien on the owner and if the property went through the short sale, whether Bank of America could be responsible for the money without the lien. Attorney Cherof advised they could be under the Code Board Order, even without the lien aspect. He agreed he would review the issue between now and the next meeting. Motion Mr. Foot moved to table the case to the meeting on May 19, 2010. Vice Chair Yerzy seconded the motion that passed unanimously. Case #09-3895 Bank of America 930 Chapel Hill Boulevard Motion Mr. Foot moved to table the case. Mr. Brake seconded the motion that passed unanimously. 5 Meeting Minutes Code Compliance Board Boynton Beach, FL May 17, 2010 V. Adjournment Vice Chair Yerzy moved to adjourn. Mr. LaTour seconded the motion that passed unanimously. The meeting adjourned at 4:33 p.m. Ii /) U1Hu/JJyl ~'Llf Catherine Cherry Recording Secretary 052710 6