A Florida appeals court has ruled county clerks can’t be sued for mortgage indexing mistakes, shifting responsibility for title searches onto brokers and lenders
Florida’s Second District Court of Appeal just ruled county clerks can’t be sued for mortgage indexing errors, a blow to buyers relying on name searches.
In this case, the Hillsborough County Clerk of Court’s office recorded two mortgages back in 2008 when Gerlinde Nelson bought two separate parcels of property and financed them through Regions Bank. Both mortgages were properly recorded. The problem came with the indexing: one mortgage was listed under “Gerlinde Nelso,” missing the last letter of Nelson’s name.
That one-letter slip mattered years later. Manhattan Palms Association One, LLC bought the affected parcel at auction in 2022, unaware that Regions Bank still held a mortgage on it. Then, in 2023, the property sold again at a tax deed sale, generating surplus funds of $138,222.44. Manhattan Palms filed a claim for the surplus in April 2023. The following month, Global Discoveries Ltd., representing Regions Bank, filed its own claim for $135,151.92. By July, the clerk sent the entire surplus to Global Discoveries.
Manhattan Palms sued, arguing the clerk’s indexing mistake caused it to buy encumbered property and lose both money and surplus funds. The lawsuit claimed the clerk had a duty to buyers and creditors searching property records — not just to the public at large.
The clerk countered with sovereign immunity. Under Florida law, clerks must keep a public index of recorded documents, but the court said that duty benefits everyone, not a specific class of people like auction buyers. The trial court initially allowed the case to proceed. But on July 23, 2025, the appellate court reversed that decision and ordered the case dismissed with prejudice.
The ruling also certified a conflict with an older case, First American Title Insurance Co. v. Dixon, where another Florida appellate court found clerks could owe a duty to bona fide purchasers in similar circumstances. That conflict opens the door for possible review by the Florida Supreme Court.
For mortgage professionals, the takeaway is clear: relying only on name-based searches isn’t enough. Legal description searches and thorough due diligence are critical, especially in distressed sales and tax deed purchases where clerical errors can surface years later. The court’s decision means clerks won’t bear liability — the burden is squarely on buyers, brokers, and title professionals to catch indexing mistakes before they cost serious money.
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