From: Dennis J. LeVine
Sent: Friday, April 03, 2009 9:17 AM
To: Dennis J. LeVine
Subject: FW: Recent Developments in Bankruptcy and Collection Law (March 2009) - Florida Replevin Law
 
March  2009

 

 

 

 

As a service to our clients, Dennis LeVine & Associates strives to keep you updated on breaking news and recent notable bankruptcy cases effecting creditors.  We would like to share the following item of interest with you.

 

 

 

THE IMPORTANCE OF COMPLETING THE REPLEVIN

PROCESS IN FLORIDA AND OBTAINING A FINAL REPLEVIN JUDGMENT

 

The process for obtaining a writ of replevin under Florida law appears straight-forward. When a replevin suit is filed, the Clerk issues the writ of replevin pursuant to a Court Order. The Writ is provided to the sheriff, and the sheriff accompanies the creditor’s agent to serve the writ. In most cases, the writ is successfully served, the creditor secures their collateral, and tells their counsel "great job, thank you for helping to get the collateral back".

Many creditors believe, or would like to believe, that the replevin process is over once the sheriff serves the writ and they obtain possession of the collateral. This is not the case. Florida law technically requires the creditor to wait to sell the collateral until the replevin process is completed; unfortunately, repossession of the collateral does not complete the replevin process. Under Florida law, the issuance of a writ of replevin is only a preliminary finding by the court as to the right to possession. The Florida replevin statute specifically says that the court will "make a determination of which party, with reasonable probability, is entitled to the possession of the claimed property pending final adjudication of the claims of the parties." After a writ of replevin is served and the collateral repossessed, the defendant has twenty days to file a motion to dissolve the writ of replevin and/or post a bond to obtain return of the collateral. When the defendant fails to file a response or post a bond, the creditor must then obtain a final judgment of replevin before selling the collateral. The entry of a final judgment of replevin completes the statutory replevin process.

After repossessing collateral using a writ of replevin, many clients ask us to either dismiss the case without prejudice, put the file on hold until they sell the collateral and decide whether to pursue a deficiency, or just close our file and leave the case pending (which eventually would result in the court dismissing the case for lack of prosecution). Creditors should not do any of these things without completing the replevin process. A case recently cited to our firm by a Florida State Court Judge illustrates why a creditor should complete the replevin process. In JB International, Inc. v. Mega Flight, Inc., 840 So.2d 1147 (Fla. 5th DCA 2003), the plaintiff obtained a writ of replevin and repossessed an airplane and two engines. The plaintiff failed to take any further action in the case. After one year, the defendant moved to dismiss the case for lack of prosecution, and the court dismissed the case. See Florida Rule 1.420(e). What was shocking to the creditor, however, was that the court also ordered the plaintiff to return the repossessed property to the defendant! The appellate court affirmed, finding that the initial issuance of a writ of replevin was not a final adjudication on the merits as to the right to possession. Therefore, "[w]hen an action is dismissed without a final adjudication on the merits, the parties are left as if the suit had never been filed. ... Prior rulings in a dismissed case have no preclusive effect [citations omitted]. Here, the only way the trial court could restore the parties to their former positions was to order the property returned." This result was an "unintended consequence" of the creditor closing its file without completing the replevin process.

The JB International case is applicable whether a writ of replevin is obtained by an order to show cause, or by posting a bond to obtain a pre-judgment writ of replevin. In either case, after taking possession of collateral by having the sheriff serve the writ, creditors should wait twenty days and then move for the entry of a Final Judgment of Replevin. Some Judges will enter the Final Judgment of Replevin without a hearing, while other Judges require a hearing before entering a Final Judgment of Replevin. The collateral should not be sold or otherwise disposed of until the Court enters the Final Judgment of Replevin.

While the result in the JB International case appears severe, it can happen to any creditor who fails to follow through once a writ of replevin is issued. Therefore, creditors should wait the additional time necessary and obtain a Court Order completing the replevin process to avoid the nightmare scenario which confronted the plaintiff in the JB International case.

 

 

 

Dennis J. LeVine

Dennis LeVine & Associates, P.A.

103 S. Boulevard

Tampa, Florida 33606

Toll Free - (877) 222-9529

 

Contact us at Dennis@bcylaw.com

 

Dennis J. LeVine is Board Certified in both business and consumer bankruptcy law by the American Board of Certification.  Mr. LeVine was admitted to the Florida Bar in 1983, and practices in the federal courts of all three Florida districts.  He has concentrated his practice in bankruptcy and collection law for 23 years.

 

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