"Legal community viral"
Foreclosure firm challenges Manatee judge who fined it
A foreclosure firm that was scolded and fined for unprofessional conduct by a Manatee County circuit judge last month has fired back, saying the judge is prejudiced against them and broke the rules herself.
The vice president of Smith, Hiatt and Diaz law firm has filed motions accusing Circuit Judge Janette Dunnigan of violating judicial ethics when she leveled a $49,000 fine against them last month for repeatedly scheduling hearings and then not showing up.
The Fort Lauderdale firm asked for a rehearing and requested Dunnigan be disqualified from the case where she found the firm in civil contempt of court. The firm "fears that it will not receive fair consideration due to prejudice and bias of the presiding judge."
The clash over reputations -- both of the judge and lawyers who could be punished for their behavior -- underscores the growing imbroglio caused by a glut of foreclosures as local judges assert themselves to re-establish control in their courtrooms.
Judges and court dockets are overwhelmed with foreclosure cases in the wake of the housing market downturn, and large foreclosure firms are handling cases en masse, frequently filing messy and sometimes fraudulent filings to retake properties, judges say.
In a judicial district where judges have taken a hard line on improper filings, Dunnigan's ruling stood out as the first time a court officer openly attacked the methods of one of the firms responsible for filing thousands of foreclosures statewide.
The judge ruled the firm's attorneys filed what amounted to "sham" paperwork in a 2007 Manatee County foreclosure, setting seven hearings over two years and then failing to appear in court or tell the judge or other parties when they were canceled.
The order went viral in the online Florida legal community and among troubled homeowners who watchdog the so-called "foreclosure mills."
Smith, Hiatt and Diaz now has defended itself in 24 pages of motions that fault Dunnigan for breaking rules preventing judges from independently investigating facts in a case or considering evidence from other cases in front of other judges.
Roy Diaz, the firm's vice-president, said in the motions that Dunnigan essentially "blind-sided" the firm with information from other cases -- conduct that would violate judicial canons. To make it worse, he said, that information turned out to be false.
At the August hearing, the most dramatic part of the hearing came after Diaz spent about 20 minutes explaining how his firm had created a "safety net" to fix the chronic absences at hearings after Dunnigan had ordered the firm to appear on contempt of court charges.
Dunnigan retorted with information from another case the firm was handling: "Well, it's not very thorough because the same thing happened today, this morning... no one appeared and no one cancelled the hearing."
Diaz responded that the absence should have been caught in their new system. And in the new motions, Diaz says his firm actually had cancelled the other case hearing six days earlier.
"Unfortunately, due to the ongoing crisis of volume faced by all parties involved in the foreclosure litigation process, it appears that the Manatee County Circuit Court Clerk failed to timely update the Manatee County Court docket," Diaz wrote.
Smith, Hiatt and Diaz is not the only law firm firing back.
Judges have started throwing out foreclosure cases that do not follow simple court rules in the 12th Judicial Circuit, including Manatee and Sarasota counties.
Firms are challenging retired Judge Harry Rapkin's decision to throw 61 cases out of court on Friday, raising the stakes on following court rules.
Dismissing the cases forces lenders to pay another court filing fee to restart the case -- up to $1,900.
(Published by Herald Tribune - September 30, 2010)