By Tracy M. Evans, Esq., Associate, Saxon, Gilmore, Carraway & Gibbons, P.A.
A recent decision by the Florida Supreme Court amounts to a victory in the area of creditors’ rights with respect to the lien priority of first mortgages. On May 16, 2013, the Florida Supreme Court issued a 5-2 decision ruling that cities cannot create “super priority” liens that trump the priority of first mortgages on properties. Central to the case was a City of Palm Beach Ordinance which made liens created by the City’s Code Enforcement Board “superior in dignity to all other liens, titles, and claims.” As the controlling authority, the Court cited Article VIII of the Florida Constitution which grants municipalities broad powers “except as otherwise provided by law” as the governing authority. The Court found that the City’s Ordinance was in direct conflict with Florida Statutes Section 695.01(1), which codifies the common law rule of first in time, first in right, with respect to the priority of liens. The Court held that this conflict between the Ordinance and the State Statute rendered the City’s Ordinance invalid under the Florida Constitution.
The full text of the opinion can be found here:
© 2013 Saxon Gilmore. Saxon Gilmore publications should not be construed as legal advice on any specific facts or circumstances. The contents are intended for general information and educational purposes only, and should not be relied on as if it were advice about a particular fact situation. The distribution of this publication is not intended to create, and receipt of it does not constitute, an attorney-client relationship with Saxon Gilmore. This publication may not be quoted or referred to in any other publication or proceeding without the prior written consent of the firm, to be given or withheld at our discretion. To request reprint permission for any of our publications, please use our Contact form via the link below. This site may contain hypertext links to information created and maintained by other entities. Saxon Gilmore does not control or guarantee the accuracy or completeness of this outside information, nor is the inclusion of a link to be intended as an endorsement of those outside sites.