Served with a lawsuit over a business loan? The short answer is this: a commercial mortgage default lawsuit asks a Florida court to enforce a loan after the borrower misses payments or breaks other loan terms. Your business may have defenses worth reviewing right away.
This page explains what the lawsuit means, which dates matter most, the defenses a lawyer reviews, and how Ayala Law PA handles these matters.
What a Commercial Mortgage Default Lawsuit Covers
A commercial mortgage default lawsuit is a lender’s case to enforce a loan secured by business or income property. The lender asks a court to decide what is owed and what happens to the property.
The borrowers in these cases are usually LLCs, corporations, partnerships and owner-operators. They borrowed to buy or refinance office, retail, warehouse, industrial, multifamily or land properties.
A default is not always a missed payment. Common triggers include:
- Late or missed payments
- Breaking a loan covenant, such as an insurance or reporting requirement
- Unpaid property taxes or insurance premiums
- An unauthorized transfer of the property
- A balloon loan that is not paid when it comes due
Your loan documents define what counts as a default. Read them alongside the lender’s notices.
What the Foreclosure Complaint Sets in Motion
The complaint starts the case. It tells you what the lender says you owe and why.
A complaint usually names the loan note and mortgage, the claimed default, any demand that the full balance is due, the amounts claimed, and any other people the lender names as defendants.
Under Fla. Stat. § 47.011, an action generally must be brought in the county where the defendant resides, where the cause of action accrued, or where the property is located. For a Hillsborough County property, that rule points to Hillsborough County. The statute does not apply to actions against nonresidents.
If the lender wins a judgment, that judgment can become a lien on real property. Under Fla. Stat. § 55.10, this happens when a certified copy is recorded in the county and the lienholder’s address is included. Judgments also carry interest: the rate is set when the judgment is obtained and adjusted each January 1 under Fla. Stat. § 55.03, based on the rate the Chief Financial Officer sets each quarter.
Why the Service Date Matters Most
The date your business was served is the first fact to lock down. Florida’s civil court rules set response deadlines, so check your service date against them right away.
Missing a deadline can cost a business defenses it could otherwise raise. Keep these items together:
- The summons, complaint and any exhibits
- The date and method of service
- Every letter or email from the lender or its lawyer
- Your loan file, payment records and any default notices
Send the papers to your lawyer the same day you receive them.
Defenses and Counterclaims a Lawyer Reviews
A lawyer checks whether the lender can prove the default, its right to enforce the loan, and the amount it claims. Common issues include:
- Standing and paper trail: Did the plaintiff hold the note and mortgage when it filed, and are the assignments documented?
- Conditions before acceleration: Did the loan require a default notice or cure period, and did the lender follow it?
- Accounting: Do principal, interest, default interest, late fees, escrow and legal fees match the payment history and loan documents?
- Waiver and course of dealing: Did the lender accept late payments, agree to forbearance, or make promises the business relied on?
- Service and pleading: Were the papers properly served, and does the complaint attach the loan documents?
A counterclaim may also be possible, such as breach of the loan agreement. However, there are two limitations on such claims, as set out in QBE Ins. Corp. v. Chalfonte Condo. Apartment Ass’n: (1) where application of the covenant would contravene the express terms of the agreement; and (2) where there is no accompanying action for breach of an express term of the agreement. But a claim on that covenant fails if it would contradict the contract’s express terms, or if there is no claim for breach of an express term.
A court also must find both unfair circumstances in making the deal and unfair terms before refusing to enforce a term. In Basulto v. Hialeah Automotive, the court concluded that both the procedural and substantive aspects of unconscionability must be present, although not necessarily to the same degree, and both should be evaluated interdependently rather than as independent elements.
Timing matters here too. In general, a party that keeps taking a deal’s benefits after learning the facts may weaken a later claim to undo it, as Flaherty v. Flaherty explains.
How the Case Usually Moves, Step by Step
Most cases move through intake, the first response, document exchange, possible mediation and motions. The timing depends on the court’s calendar and the issues raised.
- Intake. Send your lawyer the loan file, default notices, payment history, leases and the served papers. If the loan has an arbitration clause, Florida law generally enforces it, and a court decides whether that agreement exists (Fla. Stat. § 682.02).
- First response. Prepare and file the answer, defenses, and any counterclaims or motions within the required time.
- Discovery. Exchange loan records, servicing notes, payoff figures and lender communications. Depositions may follow.
- Mediation and settlement. A court may refer all or part of a filed civil case to mediation, even when it is not required (Fla. Stat. § 44.102). Under Fla. Stat. § 45.061, at any time more than 60 days after the service of a summons and complaint on a party but not less than 60 days (or 45 days if it is a counteroffer) before trial, any party may serve upon an adverse party a written offer to settle a claim for the money, property, or relief specified in the offer. That offer shall remain open for 45 days unless withdrawn sooner by a writing served on the offeree prior to acceptance by the offeree, and an offer that is neither withdrawn nor accepted within 45 days shall be deemed rejected. In the statute’s own words, the section does not apply to any class action or shareholder derivative suit, to matters relating to dissolution of marriage, alimony, nonsupport, eminent domain, or child custody, or to causes of action that accrue after the effective date of this act.
- Motions and hearings. Dispositive motions and hearings address the amount owed or the sale process.
Negotiated options such as reinstatement, forbearance, a sale, or a deed in lieu of foreclosure may come up. Any deed must be a written instrument signed in the presence of two subscribing witnesses, unless an electronic witnessing method applies (Fla. Stat. § 689.01).
Why Ayala Law PA Handles This Type of Matter
Ayala Law PA focuses its practice on business litigation, commercial and contract disputes, shareholder and partnership disputes, construction litigation, real estate litigation and international trade litigation.
The firm’s only office is at 1646 W Snow Ave in Tampa, Florida. It represents businesses and entrepreneurs in Florida courts and arbitration, including clients in Tampa, Hillsborough County, Brandon, Riverview, Plant City, Temple Terrace and the wider Tampa Bay area.
Eduardo A. Maura is the responsible lawyer for this page. Our team supports the lawyers with document review, deadline tracking and filings.
If a matter falls outside these practice areas, the firm will tell you and may refer it to another lawyer or firm.
Frequently Asked Questions
How long do I have to respond after being served?
Florida’s civil court rules set response deadlines. Check your service date against those rules right away.
Can a lender collect from me personally on a company loan?
Whether a lender can reach you personally turns on what you signed. Florida law generally requires a special promise to answer for another person’s debt to be in writing and signed by the person being charged (Fla. Stat. § 725.01). Fla. Stat. § 725.01 reads: “unless the agreement or promise upon which such action shall be brought, or some note or memorandum thereof shall be in writing and signed by the party to be charged therewith or by some other person by her or him thereunto lawfully authorized.”
Can a judgment become a lien on my property?
Yes, under Florida law a judgment can become a lien on real property in a county once a certified copy is recorded there with the lienholder’s address.
Can a commercial loan dispute go to arbitration or mediation?
Yes, if the loan contract requires arbitration, Florida law generally enforces that clause. A court may also refer a filed civil case to mediation.
Can a lender enforce a loan after accepting late payments for months?
The lender’s conduct is one of the defenses a lawyer reviews, along with the loan terms and the payment history.
Next Steps If Your Business Has Been Served
If your business was just served, get the papers and loan file to a lawyer before the response date passes.
- Gather the summons, complaint, exhibits, loan documents, default notices and payment records.
- Write down the service date and how the papers arrived.
- Note any letters or emails from the lender or its lawyer.
If a lender’s complaint is in your hands with a response date ahead, call Ayala Law PA at (305) 570-2208 or send a request through the contact page. The responsible lawyer can review your deadline, your loan documents and the defenses that may apply.
