IN THE THIRD DISTRICT COURT OF APPEALS

FOR THE STATE OF FLORIDA

XLT INVESTMENT CORP., a Florida

corporation,

CASE NO: 3D17-230

Appellant,

vs. L.T. CASE NO: 12-43649 CA 02

ALYSSA ELSO, MICHAEL ELSO, and

JUAN C. ELSO,

Appellees.

_______________________________________/

APPELLEES’ REPLY TO APPELLANT, XLT INVESTMENT

CORPORATION’S RESPONSE IN OPPOSITION TO MOTION

TO DISMISS NOTICE OF APPEAL OF NON-FINAL

ORDER AND BRIEF FOR LACK OF JURISDICTION

COME NOW, Appellees, ALYSSA ELSO and MICHAEL ELSO, by and

through undersigned counsel, pursuant to Florida Rule of Appellate Procedure

9.300 and file this Reply to Appellant, XLT Investment Corp.’s (“XLT”) Response

in Opposition to Appellees Motion to Dismiss the Notice of Appeal of Non-Final

Order and Initial Brief, and state the following:

INTRODUCTION

Appellant XLT filed a notice of appeal challenging the trial court’s entry of

a Final Default Judgment as to co-Defendant George Elso, by asserting that the

Final Default Judgment determined the right to the immediate possession of

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property, thus, XLT contends this Court has appellate jurisdiction pursuant to

Florida Rule of Appellate Procedure 9.130(a)(3)(C)(ii). However, as set forth in

Appellees Motion to Dismiss and as demonstrated below, XLT not only lacks

standing to appeal the Final Default Judgment entered as to the co-defendant, but

the judgment at issue is not an appealable non-final order within the purview of

Rule 9.130(a)(3)(C)(ii). More importantly, the Final Default Judgment entered by

the trial court as to co-Defendant, George Elso, did not adjudicate any claims,

defenses or counterclaims raised by XLT, nor did it determine XLT’s right to the

immediate possession of property. Consequently, this Court lacks jurisdiction

under Rule 9.130(a)(3)(C)(ii) to review the non-final order.

PROCEDURAL BACKGROUND

1. On November 6, 2012, Appellees Alyssa Elso, Michael Elso and Juan

C. Elso filed their initial complaint for cancellation of deed, constructive fraud,

constructive trust and resulting trust against Defendant, George I. Elso.

2. Defendant, George Elso was served with the complaint on November

30, 2012, and on March 7, 2013, filed an answer and affirmative defenses to the

complaint, but neglected to apprise the Court or Appellees that he had unilaterally

and fraudulently conveyed the property to XLT Investment Corporation on or

about February 7, 2013, and that he no longer held any interest in the property.

3. While awaiting Defendant George Elso’s response to the discovery

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Orders, Appellees fortuitously discovered that Defendant George Elso during the

pendency of this action, in an effort to deprive Plaintiffs of their rightful interest in

the subject property, falsified and recorded a Quit Claim Deed in his favor and

thereafter executed a Warranty Deed in favor of XLT Investment Corp., thereby

purportedly transferring and/or conveying all of his interest in the subject property

to XLT Investment Corp.

4. As a result of this transfer, which was in violation of the Uniform

Fraudulent Transfer Act, on June 12, 2013, Appellees filed a Motion for Leave to

Amend their Complaint to include two additional parties, XLT Investment Corp.

and Luis A. Torrens, which leave the Court granted on June 24, 2013.

5. Appellees Amended Complaint added two counts, to include a count

to quite title by setting aside the allege mortgage1 and warranty deed held by XLT

Investment Corp., and a count to cancel, rescind and invalidate the warranty deed

in lieu of foreclosure based on the fraudulent conveyance executed by Defendant

George Elso, under Florida Statute § 726.105 (the Uniform Fraudulent Transfer

Act).

6. On July 24, 2014, Circuit Court Judge Spencer Eig entered a

judicial default against Defendant George Elso for failing to file and answer to

1 Although XLT claims to hold a Mortgage encumbering the subject property,

executed by George Elso and Miriam Elso on September 24, 2010, in the amount

of $250,000, XLT now claims that the amount actually loaned was only $150,000.

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Appellees Amended Complaint.

7. On October 28, 2016, based on the entry of the Court’s August 22,

2016 Order affirming entry of Default as to Defendant George Elso, Appellees

filed their Motion for Final Default Judgment as to Defendant George Elso only,

and scheduled it for hearing on November 29, 2016.

8. Interestingly and without any basis, at the November 29, 2016

hearing, counsel for co-Defendant/Appellant XLT noted his objection to the entry

of a Final Default Judgment against co-Defendant, George Elso, and despite XLT’s

lack of standing, requested an opportunity to submit a response to the Motion for

Final Default Judgment as to co-Defendant, George Elso. The Court granted

XLT’s request to submit a memorandum of law in support of their position.

9. On January 4, 2017, after having considered XLT’s November 30,

2016 response, the Court entered a Final Default Judgment in Favor of Plaintiffs

and Against Defendant, George I. Elso Only.

10. On January 30, 2017, XLT filed a Notice of Appeal of Non-Final

Order, by which XLT seeks to appeal the entry of a Final Default Judgment

entered against another defendant, namely, Defendant George I. Elso.

11. Appellant, XLT Investment Corp. lacks standing to appeal the entry

of a Final Default Judgment against Defendant, George I. Elso, and XLT’s

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Notice of Appeal of that Final Judgment as if it were a Non-Final Order, is

unauthorized.

ARGUMENT

I. XLT INVESTMENT CORPORATION LACKS STANDING TO

APPEAL A FINAL DEFAULT JUDGMENT ENTERED AGAINST

CO-DEFENDANT GEORGE ELSO.

XLT lacks standing to appeal the Final Default Judgment entered in favor of

Plaintiffs/Appellees and against co-Defendant, George Elso only, as the judgment

entered against co-defendant George Elso did not adjudicate or determine

Appellant XLT’s claims or defenses. As the judgment entered solely against co-

Defendant George Elso succinctly and expressly noted, “this judgment does not

adjudicate claims, defenses or counterclaims between Plaintiffs and XLT

Investment Corp.” (Emphasis added).

Although a party generally has standing if he or she has a sufficient interest

at stake in the controversy which will be affected by the outcome of the litigation,

Gieger v. Sun First Nat’l Bank of Orlando, 427 So.2d 815 (Fla. 5th DCA 1983), the

entry of a Final Default Judgment against co-defendant George Elso did not

determine XLT’s claims or the outcome of the litigation, which remains subject to

determination at trial. Moreover, XLT’s reliance on Khazaal v. Browning, 707

So.2d 399 (Fla. 5th DCA 1998), in support of its standing argument is misplaced, as

the facts are clearly distinguishable. In Khazaal, holders of a security interest in a

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liquor license sought to foreclose against the grantor of the security interest and the

grantor’s brother, to whom the liquor license had been transferred. The grantor

answered and raised affirmative defenses, but the grantor’s brother suffered a

clerk’s default. The trial court entered a default final judgment of foreclosure,

adjudicating and foreclosing the interests of both the grantor (Nazih) and the

grantor’s brother (Nabil). In fact, the judgment stated that title to the collateral was

either vested in appellant or his brother. Id. at 400. In that case, unlike the

circumstances in the present case, the foreclosure judgment determined the right to

immediate possession of property, which was shortly thereafter redeemed. See

also, Khazaal v. Browning, 717 So.2d 1124 (Fla. 5th DCA 1998). In the instant

case, XLT’s right to foreclose on the note and mortgage, which it claims to hold,

remains to be determined at trial.

While XLT, as an alleged mortgagee, may have, subject to the trial court’s

determination, an interest at stake in the underlying litigation, this, however does

not provide standing to appeal on an interlocutory basis, a Final Default Judgment

entered against a co-defendant, especially where that judgment did not determine

anyone’s right to the immediate possession of property as required pursuant to

Rule 9.130(a)(3)(c)(ii), nor did it determine the outcome of the litigation as it

pertains to XLT.

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Contrary to XLT’s contention, the order on appeal in the case at bar did not

determine the immediate right to possession of property, nor did the judgment call

for a judicial sale of the property, which remains subject to a lis pendens recorded

by XLT.2 While XLT correctly notes that the final default judgment entered

against George Elso ordered the cancellation of two deeds, which on paper affects

record title, the cancellation of the deeds did not determine the immediate right to

possession of property, which at all times has been, and remains in the possession

of the Appellees.

II. THE COURT LACKS JURISDICTION TO REVIEW THE FINAL

DEFAULT JUDGMENT WHICH DID NOT DETERMINE THE

RIGHT TO IMMEDIATE POSSESSION OF PROPERTY AS

REQUIRED BY FLORIDA RULE OF APPELLATE PROCEDURE

9.130(a)3(C)(ii).

Rule 9.130, of the Florida Rules of Appellate Procedure, strictly limits the

types of non-final orders that may be reviewed on appeal in order “to reduce the

number of appealable pretrial orders and to discourage piecemeal review.”

Travelers Ins. Co. v. Burns, 443 So.2d 959, 961 (Fla. 1994). Courts have therefore

“narrowly construed the scope of the rule” so that only those orders specifically

identified by Rule 9.130 may be reviewed by district courts. Id. at 961. See also,

Walker v. Florida Gas Transmission Co., LLC, 134 So.3d 571 (Fla. 1st DCA 2014)

2 It should be noted that XLT, as an alleged mortgagee, has never had possession

of the property (immediate or otherwise), which is the subject of this litigation, and

in fact, has never set foot inside the residence.

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(Trial court’s order was not an appealable non-final order, especially where

appellants have not met immediacy requirement under Rule 9.130(a)(3)(c)(ii));

Tarik, Inc. v NNN Acquisitions, Inc., 17 So.3d 912 (Fla. 4th DCA 2009) (Rule

allowing interlocutory appeals of orders determining the right to immediate

possession of property should be narrowly interpreted.)

Notwithstanding that the Final Default Judgment states that it is directed

only against George Elso, XLT claims that the entry of the judgment against

George Elso somehow permits XLT to seek piecemeal, interlocutory appellate

review. Contrary to XLT’s contention, the entry of a final default judgment as to

co-Defendant George I. Elso is not a non-final appealable order as to XLT, because

the judgment did not determine the right to the immediate possession of property

and, thus, was not an appealable interlocutory order. Moreover, XLT has not met

the immediacy requirement under Rule 9.130(a)(3)(C)(ii). See Walker, 134 So.3d

at 573. Here, like in Walker, the trial court’s judgment did not address or

adjudicate XLT’s claims, defenses or counterclaims, nor did it determine its right

to the immediate possession of property.

In Miami-Dade County v. Perez, 988 So.2d 40 (Fla. 3d DCA 2008), this

Court dismissed an appeal in which the trial court had denied a motion for

summary judgment regarding the parties’ rights and interests in certain real estate.

This Court reasoned that “the effect of the order was simply to deny summary

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disposition of the parties’ respective claims to immediate possession - not to

determine those claims. The claims remain subject to determination at trial.” Id.

at 41(emphasis in original). In the instant case, despite XLT’s protestations to the

contrary, the Final Default Judgment entered against co-Defendant George Elso

made no determination of XLT’s rights, which like in Perez, remain subject to

determination at trial.

Similarly, in Marina Bay Hotel & Club, Inc. v. McCallum, 733 So.2d 1133

(Fla. 4th DCA 1999), the appellant (lessor) argued that the trial court’s order

denying the motion for summary judgment was appealable because it determined

the right to immediate possession of property. However, the Fourth District,

reciting a duty to narrowly construe Rule 9.130(a)(3), dismissed the appeal, noting

that a party’s summary judgment motion does not determine the “immediate right

to possession” even though it may resolve the underlying legal issues. Here, while

the Final Default Judgment may have resolved the underlying legal issues and

determined property rights as to co-Defendant George Elso, it did not determine

the immediate right to possession of property. XLT has clearly not met the

immediacy requirement under Rule 9.130

In Corzo v. Pineiro, 990 So.2d 1177 (Fla. 3d DCA 2008), this Court

dismissed an appeal brought pursuant to Rule 9.130(a)(3)(C)(ii), where this Court

found it had no jurisdiction and noted that the circuit court had not yet tried or

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otherwise ruled upon the convoluted claims of ownership, unwritten lease rights,

and corporate trickery asserted by the parties against one another. In the instant

case, just like in Corzo, the circuit court has not yet addressed XLT’s claims,

defenses or counterclaims, which remain subject to determination at trial. Simply

put, if XLT, as a mortgagee, can establish that it is a bona fide lender who actually

provided consideration for the alleged Mortgage, then XLT would be entitled to

foreclose on the note and mortgage at trial. Thus, its interests are not affected by a

judgment entered against a co-defendant.

In an effort to satisfy the immediacy requirement of Rule 9.130(a)(3)(c)(ii),

XLT relies on Shepard v. Ouellete, 854 So.2d 251 (Fla 5th DCA 2003), Luneke v.

Becker, 621 So.2d 744 (Fla. 2d DCA 1993), and Amerifirst Federal Savings and

Loan Ass’n v. Cohen, 454 So.2d 626 (Fla. 3d DCA 1984). All three cases are

distinguishable. In Shepard, the Court found that it had jurisdiction to review a

“partial final judgment” ordering a judicial sale of property because it determined

the immediate right to possession. However, the appellate review was limited to

the question as to the propriety of the ordered sale of the property. Here, the

judgment entered against co-Defendant George Elso did not order a judicial sale,

or affect the disposition of the property, which as noted previously herein, remains

subject to a lis pendens recorded by XLT.

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In Luneke v. Becker, 621 So.2d 744 (Fla. 2d DCA 1993), the non-final order

determined the right to immediate possession of property because it ejected the

defendant from the property and granted plaintiff an immediate writ of possession.

In the instant case, the judgment at issue did not order the ejectment of XLT nor

did it grant Appellees or any party, a writ of possession.

Finally, in Amerifirst Federal Savings and Loan Ass’n v. Cohen, 454 So.2d

626 (Fla. 3d DCA 1984), this Court held that a non-final order requiring the

delivery of a mortgage and promissory note to plaintiff, plainly determined the

right to immediate possession of property. Here, the judgment entered against co-

Defendant George Elso did not order the delivery of a mortgage and promissory

note, nor did it extinguish or determine the validity of XLT’s alleged mortgage and

note, which remains subject to determination at trial.

Not only has XLT not met the immediacy requirement under Rule

9.130(a)(3)(c)(ii), but it has failed to demonstrate that it would be left without an

appropriate appellate remedy after its claims, defenses and counterclaims are

determined at trial, requiring interlocutory review. In short, XLT requests that this

Court engage in the type of piecemeal review that Rule 9.130 was implemented to

discourage. See Burns, 443 So.2d at 961.

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CONCLUSION

Appellees Alyssa Elso and Michael Elso submit that Appellant XLT

Investment Corporation, lacks standing to appeal the Final Default Judgment

which was entered against co-Defendant, George Elso only, as XLT’s rights

remain subject to determination at trial and where the judgment at issue did not

determine the right to immediate possession of property, as required.

WHEREFORE, Appellees request that this Court dismiss Appellant XLT

Investment Corp.’s appeal for lack of jurisdiction.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true copy of the foregoing was provided via

Email to: Juan C. Zorrilla, Esq., Fowler White Burnett, P.A., jzorrilla@fowler-

white.com, 1395 Brickell Avenue, Miami, Florida 33131; Carlos D. Lerman, Esq.,

Lerman & Whitebook, P.A., carlos@lwlawfla.com 2611 Hollywood Boulevard,

Hollywood, Florida 33020; and to Jorge E. Silva, Esq., jsilva@silvasilva.com, 236

Valencia Avenue, Coral Gables, FL 33134 10th day of February, 2017.

Respectfully submitted,

By: s/ Raphael Lopez

RAPHAEL LOPEZ, ESQ.

Florida Bar No.: 95328

LOPEZ ROCA, P.A.

Courthouse Tower

44 West Flagler Street, Suite 1750

Miami, Florida 33130

Telephone: (305) 373-0702

Facsimile: (305) 373-0706

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Primary Email: rl@lopezroca.com

Secondary Email: ap@lopezroca.com

CERTIFICATE OF COMPLIANCE WITH FONT STANDARD

I certify that this brief complies with Fla. R. App. P. 9.210 and has been

typed in Times New Roman, 14 Point.

By: s/Raphael Lopez

Raphael Lopez, Esq.

Florida Bar No. 95328