Full Opinion

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED IN THE DISTRICT COURT OF APPEAL OF FLORIDA SECOND DISTRICT RALSTON E. MacDONNELL and ) CHARLENE ANN ) LATIMER-MacDONNELL, ) ) Appellants, ) ) v. ) Case No. 2D19-432 ) U.S. BANK N.A., as Legal Title Trustee for ) Truman 2013 SC4 Title Trust; EQUITY ) TRUST COMPANY, as Custodian FBO ) IRA Account No. Z029889; ANGELO ) INGORVAIA; THE BEACHES OF ) LONGBOAT KEY-SOUTH OWNERS ) ASSOCIATION, INC.; QUALITY ) SCREENING WINDOW AND DOOR, ) INC.; PIPER FIRE PROTECTION, INC.; ) and SPECTRUM CONTRACTING, INC., ) ) Appellees. ) ___________________________________) Opinion filed April 1, 2020. Appeal pursuant to Fla. R. App. P. 9.130 from the Circuit Court for Sarasota County; Andrea McHugh, Judge. Gregg Horowitz, Sarasota, for Appellants. Roy A. Diaz of SHD Legal Group, P.A., Fort Lauderdale, for Appellee U.S. Bank. James D. Gibson of Gibson, Kohl & Wolff, P.L., Sarasota, for Appellees Equity Trust Company and Angelo Ingorvaia. No appearance for remaining Appellees. SILBERMAN, Judge. A final judgment of foreclosure was entered in favor of U.S. Bank N.A. in September 2016 against Ralston E. MacDonnell and Charlene Ann Latimer- MacDonnell. The property was sold at a foreclosure sale in October 2016 to third-party purchasers Equity Trust Company, as Custodian FBO IRA Account No. Z029889, and Angelo Ingorvaia (collectively, Equity Trust). The MacDonnells now appeal the order denying their motion filed pursuant to Florida Rule of Civil Procedure 1.540(b) to set aside the final judgment of foreclosure. We affirm the trial court's order except to the extent the final judgment awarded unliquidated damages and remand for a hearing on unliquidated damages with notice and an opportunity to be heard by the MacDonnells. On April 8, 2016, U.S. Bank filed this mortgage foreclosure action concerning real property in Longboat Key, Florida, against the MacDonnells and other defendants. The Longboat Key property was a vacation home for the MacDonnells, and they were properly served with a summons and complaint at their primary residence in Nova Scotia, Canada, on May 17, 2016. They failed to file a response to the complaint, and the clerk entered defaults against them on June 20, 2016. U.S. Bank thereafter sent copies of documents concerning the litigation to the Longboat Key address. Mail sent to the Longboat Key address is not forwarded to the MacDonnells' Canadian residence but is returned to the sender. U.S. Bank filed a motion for summary judgment, and the trial court entered a Uniform Final Judgment of Mortgage Foreclosure on September 13, 2016, in the total -2- amount of $658,337.19. A foreclosure sale took place on October 4, 2016, at which Equity Trust placed the successful bid of $664,038. On October 5, 2016, the MacDonnells, through counsel, filed an objection to sale and requested that the sale be vacated based on the MacDonnells' attempt to reinstate the loan. The trial court overruled the objection to sale, and the MacDonnells unsuccessfully appealed that ruling. On March 2, 2017, the MacDonnells filed their motion to set aside final judgment of foreclosure pursuant to rule 1.540 and alleged lack of notice. They asserted that "[a] defaulting party has a due process entitlement to notice and an opportunity to be heard as to the presentation and evaluation of evidence necessary to a judicial determination of the amount of unliquidated damages." At a hearing on the motion, the MacDonnells argued that the judgment was void because they received no notice of the hearing on the motion for summary judgment and were denied due process. The trial court, relying upon Equity Trust's arguments which U.S. Bank adopted, denied the motion to set aside the judgment. In its order, the trial court found that the MacDonnells were properly served with process and that the court had jurisdiction over them and the case. Further, the trial court found that the MacDonnells "were aware of the entry of the Final Judgment well within the time to timely file an appeal of the Final Judgment of Foreclosure. The arguments made in the motion could have and should have been raised in such an appeal." The trial court concluded that the judgment was voidable but not void. The trial court stated, "The holding in Sterling Factors Corp. v. U.S. Bank National Ass'n, 968 So. 2d 658 (Fla. 2d DCA 2007), wherein -3- the Court held that a motion for relief from judgment cannot be used as a substitute for an appeal, is controlling." The MacDonnells now appeal that ruling. A ruling on a motion to set aside a judgment under rule 1.540(b) is generally reviewed for an abuse of discretion. Rodriguez v. Thompson, 235 So. 3d 986, 987-88 (Fla. 2d DCA 2017). But the trial court lacks discretion when a final judgment is void; thus, the issue of whether a judgment is void is subject to de novo review. Id. To the extent the MacDonnells argue that the failure to serve the default judgment on them divested them of their right to move for rehearing or timely appeal, the judgment was not void on this basis. In Sterling, a foreclosure case, Sterling was a lienholder defendant and did not receive notice of a hearing on the plaintiff's motion for summary judgment. 968 So. 2d at 660. The trial court had jurisdiction over the subject matter and personal jurisdiction over Sterling. Id. at 665. This court determined that Sterling had actual notice of the judgment in time to file a motion for rehearing or notice of appeal. Id. at 666-67. We also pointed out that Sterling had not made a claim in the trial court under rule 1.540(b) for excusable neglect, fraud, or misrepresentation. Id. at 667. This court determined that the defect in the notice for the summary judgment hearing did not render the foreclosure judgment void such that it was subject to collateral attack at any time. Id. The MacDonnells rely upon Diquollo v. TD Bank, N.A., 224 So. 3d 341 (Fla. 5th DCA 2017), but it is distinguishable. The appellate court recognized that Florida Rule of Administrative Procedure 2.516(h)(2) requires the court to mail a conformed copy of the final judgment to a defaulting party. Id. at 342. Because the court was provided with an erroneous address by the plaintiff, the defaulting party did -4- not receive a copy of the judgment until the time to file an appeal had run. In that situation, the appellate court reversed the order denying the motion to vacate the judgment under rule 1.540(b) and remanded for entry of a new final judgment. Id. Thus, this provided the defaulted party with an opportunity to appeal. See also Hialeah Hotel, Inc. v. Woods, 778 So. 2d 314, 316 (Fla. 3d DCA 2000) (stating that when "a party does not receive a court order until the time for appeal has run, due process requires that the order be reentered so that the adversely affected party can file a notice of appeal"). Relying on evidence adduced at the hearing on the MacDonnells' motion, the trial court determined that the MacDonnells knew of the entry of the judgment well within the time to appeal. In fact, during the time within which they could have filed an appeal, the MacDonnells retained counsel who filed an objection to the foreclosure sale but did not appeal the foreclosure judgment. In addition, similar to Sterling, the MacDonnells never raised in the trial court mistake, inadvertence, surprise, excusable neglect, fraud, or misrepresentation. See Fla. R. Civ. P. 1.540(b)(1), (3). We affirm the trial court's order that denies relief except to the extent the MacDonnells argue that they are entitled to relief as to unliquidated damages, as explained below. We note that the issue of unliquidated damages was not mentioned in the Sterling decision. A trial court can enter a default judgment regarding liquidated damages without any further proof of damages. Maggiano v. Whiskey Creek Prof'l Ctr., LLC, 160 So. 3d 535, 536 (Fla. 2d DCA 2015). But "[e]ven when a default on liability has been entered against a litigant," that defaulting party is entitled to a trial on unliquidated damages. Rodriguez, 235 So. 3d at 988. The "defaulted party has a due process right -5- to notice and an opportunity to be heard on the subject of unliquidated damages." Id. Florida Rule of Civil Procedure 1.440(c) protects the defaulted party's right of procedural due process. Rodriguez, 235 So. 3d at 988. The rule "requires that '[i]n actions in which the damages are not liquidated, the order setting an action for trial shall be served on parties who are in default.' " Id. (alteration in original) (quoting Fla. R. Civ. P. 1.440(c)). "[W]hen a trial court enters a judgment awarding unliquidated damages against a defaulted party after a trial of which the defaulted party was not provided notice, the resulting judgment is void." Id.; see also Cellular Warehouse, Inc. v. GH Cellular, LLC, 957 So. 2d 662, 666 (Fla. 3d DCA 2007) (stating that "the relevant notice to which [the defaulting party] was entitled was notice and an opportunity to be heard before the entry of a default final judgment that awarded unliquidated damages" and that the portion of the judgment awarding unliquidated damages was void). In Rodriguez, the defaulted parties had not received notice of an order setting a trial on unliquidated damages arising from an auto accident. 235 So. 3d at 987. This court affirmed the trial court's order denying relief under rule 1.540(b) as to liability but reversed the "order to the extent it declined to set aside the damages judgment" and remanded for a new trial on damages. Id. at 988. Here, the complaint alleged a principal amount due of $585,777.41, plus interest from August 1, 2015, as provided in the note and mortgage. The MacDonnells acknowledge on appeal that the amount of principal and interest is liquidated, citing Asian Imports, Inc. v. Pepe, 633 So. 2d 551 (Fla. 1st DCA 1994). However, they contend that all other amounts awarded in the final judgment are unliquidated. Those items include pre-acceleration late charges ($1059.20), title search and examination -6- ($350), property inspections ($80.50), mediation expense ($225), property taxes ($8093.48), insurance ($12,704.35), the filing fee ($1988), service of process ($1055.60), and attorney's fees ($2550). These items total $28,106.13. "Damages are liquidated when the proper amount to be awarded can be determined with exactness from the cause of action as pleaded, i.e., from a pleaded agreement between the parties, by an arithmetical calculation or by application of definite rules of law." Paramo v. Floyd, 154 So. 3d 477, 478 (Fla. 2d DCA 2015) (quoting Bowman v. Kingsland Dev., Inc., 432 So. 2d 660, 662 (Fla. 5th DCA 1983)). But if testimony is necessary to determine facts upon which to base the exact amount, the damages are unliquidated. Id. And an affidavit of proof does not act to liquidate damages. Ciprian-Escapa v. City of Orlando, 172 So. 3d 485, 490 (Fla. 5th DCA 2015). Damages for reasonable attorney's fees are ordinarily unliquidated. See Paramo, 154 So. 3d at 478; Ciprian-Escapa, 172 So. 3d at 490; Cellular Warehouse, 957 So. 2d at 665. Damages for costs are also unliquidated. Ciprian-Escapa, 172 So. 3d at 490. We agree with the MacDonnells that the amounts they contest cannot be determined by the pleaded agreement between the parties or by arithmetical calculation. With one exception, the amounts they challenge require testimony or some other proof and thus are unliquidated damages. The exception is the attorney's fees awarded in the default foreclosure judgment. U.S. Bank and Equity Trust point out that section 702.065, Florida Statutes (2015), serves to liquidate the amount in certain circumstances which are applicable here. Section 702.065(2) provides as follows: (2) In a mortgage foreclosure proceeding, when a default judgment has been entered against the mortgagor and the note or mortgage provides for the award of reasonable attorney's fees, it is not necessary for the court to hold a -7- hearing or adjudge the requested attorney's fees to be reasonable if the fees do not exceed 3 percent of the principal amount owed at the time of filing the complaint, even if the note or mortgage does not specify the percentage of the original amount that would be paid as liquidated damages. Such fees constitute liquidated damages in any proceeding to enforce the note or mortgage. This section does not preclude a challenge to the reasonableness of the attorney's fees. Thus, because the attorney's fees awarded of $2550 are well below three percent of the principal amount owed at the time of the filing of the complaint, section 702.065 serves to liquidate the damages for attorney's fees. The MacDonnells have not disputed the applicability of section 702.065(2) and have not challenged the reasonableness of the fee award. Instead, they only argue that the amount is unliquidated. Accordingly, we subtract the $2550 from the total of $28,106.13. We conclude that the remaining items, totaling $25,556.13, are unliquidated damages, and the MacDonnells are entitled to relief as to those items. Although the usual relief would be to remand for the trial court to vacate the judgment as to liquidated damages and conduct a new trial on damages, see Rodriguez, 235 So. 3d at 988, here yet another exception applies. As Equity Trust points out, the MacDonnells' remedy is monetary damages pursuant to section 702.036(1), which provides as follows: (1)(a) In any action or proceeding in which a party seeks to set aside, invalidate, or challenge the validity of a final judgment of foreclosure of a mortgage or to establish or reestablish a lien or encumbrance on the property in abrogation of the final judgment of foreclosure of a mortgage, the court shall treat such request solely as a claim for monetary damages and may not grant relief that adversely affects the quality or character of the title to the property, if: -8- 1. The party seeking relief from the final judgment of foreclosure of the mortgage was properly served in the foreclosure lawsuit as provided in chapter 48 or chapter 49. 2. The final judgment of foreclosure of the mortgage was entered as to the property. 3. All applicable appeals periods have run as to the final judgment of foreclosure of the mortgage with no appeals having been taken or any appeals having been finally resolved. 4. The property has been acquired for value, by a person not affiliated with the foreclosing lender or the foreclosed owner, at a time in which no lis pendens regarding the suit to set aside, invalidate, or challenge the foreclosure appears in the official records of the county where the property was located. The MacDonnells were properly served, the final judgment of foreclosure was entered, and the time for appeal of the final judgment has expired. In addition, at the hearing on the MacDonnells' motion, Equity Trust established that it purchased the property for value, that it is not affiliated with the foreclosing lender or foreclosing owner, and that there was no lis pendens regarding any suit to set aside the final judgment. In this situation, the trial court may treat the motion to vacate the final judgment as a request for monetary relief. See Nationstar Mortg., LLC v. Diaz, 227 So. 3d 726, 730 (Fla. 3d DCA 2017). Therefore, we affirm the order denying the MacDonnells' motion to set aside the final judgment except to the extent the MacDonnells seek relief on unliquidated damages. As to unliquidated damages, we reverse so that the trial court may treat the motion as a request for monetary relief on remand. The trial court should hold an evidentiary hearing on the amount of unliquidated damages with proper notice to the MacDonnells, absent an agreement on the amount. -9- Affirmed in part, reversed in part, and remanded. NORTHCUTT and ROTHSTEIN-YOUAKIM, JJ., Concur. - 10 -