IN THE SUPREME COURT OF FLORIDA. CONSTRUCTION INC., a Florida corporation, L.T. No. 4D07-391

Transcription

1 IN THE SUPREME COURT OF FLORIDA PADULA & WADSWORTH CASE NO. SC CONSTRUCTION INC., a Florida corporation, L.T. No. 4D Petitioner, v. PORT-A-WELD, INC., a Florida corporation, Respondent. ON PETITION FOR DISCRETIONARY REVIEW OF A DECISION OF THE FOURTH DISTRICT COURT OF APPEAL PETITIONER S BRIEF ON JURISDICTION JAMES B. BOONE, ESQ. Attorney for Petitioner P.O. Box Weston, FL (Fla. Bar No ) Telephone: (954) Facsimile: (954) jamesbboone@earthlink.net

2 TABLE OF CONTENTS TABLE OF AUTHORITIES... Page ii INTRODUCTION... 1 STATEMENT OF THE CASE AND OF THE FACTS... 1 SUMMARY OF ARGUMENT... 4 ARGUMENT... 5 I. THE DECISION BELOW DIRECTLY CONFLICTS WITH ESTABLISHED PRECEDENT THAT COURTS ARE REQUIRED TO ENFORCE ATTORNEY S FEES AND COSTS PROVISIONS IN CONTRACTS... 5 II. THE DECISION BELOW DIRECTLY CONFLICTS WITH ESTABLISHED PRECEDENT THAT A REQUEST FOR APPELLATE ATTORNEY S FEES MUST STATE THE SPECIFIC BASIS FOR THE SAME... 8 CONCLUSION... 9 CERTIFICATE OF SERVICE CERTIFICATE OF COMPLIANCE i

3 TABLE OF AUTHORITIES Cases: Page B&H Construction & Supply Co., Inc. v. District Board of Trustees of Tallahassee Community College, 542 So.2d 382, 387 (Fla. 1 st DCA 1989)... 6 Blue Lake Apartments Ltd. v. George Gowing, Inc., 464 So.2d 705, 708 (Fla. 4 th DCA 1985)... 7 Brass & Singer, P.A. v. United Automobile Insurance Company, 944 So.2d 252, (Fla. 2006)... 9 Fixel Enterprises, Inc. v. Theis, 524 So.2d 1015 (Fla. 1988)... 6 Hembd v. Dauria, 859 So.2d 1238 (Fla. 4 th DCA 2003)... 8 Home Depot v. Ferreira, 827 So.2d 371 (Fla. 1 st DCA 2002)... 9 Lakewood on the Green Villas Association, Inc., v. Pomerantz, 556 So.2d 505, 506 (Fla. 4 th DCA 1990)... 7 Lashkajani v. Lashkajani, 911 So.2d 1154, 1158 (Fla. 2005)... 5, 6 Maw v. Abinales, 463 So.2d 1245, 1247 (Fla. 2 nd DCA 1985)... 7 Nemours Foundation v. Gauldin, 601 So.2d 574, 576 (Fla. 5 th DCA 1992)... 7 P&C Thompson Bros. Construction Company v. Rowe, 433 So.2d 1388 (Fla. 5 th DCA 1983)... 3, 6 Precision Tune Auto Care, Inc. v. Radcliffe, 815 So.2d 708, (Fla. 4 th DCA 2002)... 3 ii

4 Cases Page Price v. Tyler, 890 So.2d 246, 251 (Fla. 2004)... 5 Rybovich Boat Works, Inc. v. Atkins, 587 So.2d 519, 521 (Fla. 4 th DCA 1991)... 6 Sullivan v. Galske, 917 So.2d 412 (Fla. 2 nd DCA 2006)... 6 Sumner Group, Inc. v. M.C. Distributec, Inc., 949 So.2d 1205, 1206 (Fla. 4 th DCA 2007)... 7 United Services Automobile Association v. Phillips, 755 So.2d 921 (Fla. 2000)... 8, 9 Walls v. Quick & Reilly, Inc., 824 So.2d 1016, 1019 (Fla. 5 th DCA 2002)... 3 Statutes: (7), Fla. Stat , Fla. Stat Rules of Procedure Rule 9.400(b), Fla. R. App. P.... 8, 9 iii

5 INTRODUCTION There were two separate orders dated January 10, 2007, and May 7, 2007, that were considered by the Fourth District Court of Appeal and which were assigned Case No. 4D and 4D , respectively. The cases were consolidated only for record purposes but were considered by the same merits panel. The Court issued only one opinion on both orders. It also entered a separate order in each case entitling Respondent to appellate attorney s fees. Accordingly, in order to avoid any waiver concerning this opinion, a petition for discretionary review was filed in both cases. The Fourth District case is reported at 33 Fla. L. Weekly D1358a. STATEMENT OF THE CASE AND THE FACTS As provided in the decision of the Fourth District, Petitioner was the general contractor and the Respondent was a subcontractor on a project known as the West Central Bus Complex which was owned by the School Board of Broward County. Respondent claimed Petitioner owed it money for its work in constructing metal stairs in one of the buildings. Respondent sued Petitioner in a two count Amended Complaint on a breach of contract theory and on an unjust enrichment theory, both in the amount of $33, Petitioner filed a compulsory counterclaim for setoffs. Respondent recovered $20, on its claim under breach of contract 1

6 after adjustment for the setoffs and $ for unjust enrichment. The contract between the parties, in Article VI(D), contained the following clause defining who was the prevailing party for purposes of awarding attorney s fees and costs: Subcontractor and Contractor agree that in the event arbitration proceedings or litigation is initiated by either party, the non prevailing party shall be liable for all arbitrator s fees and costs, attorney s fees and court costs incurred by the prevailing party at all levels of proceedings or negotiations. For the purposes of this Agreement, a party shall not be considered a prevailing party if its recovery shall be less than 75% of its claim amount. Based upon this definition, the trial court found that the Petitioner was entitled to its attorney s fees and costs as the prevailing party and entered an order dated January 10, 2007, which became the subject of the appeal in this case. Thereafter, over objection and at a hearing noticed only on Petitioner s Motion for Attorney s Fees, the trial court allowed Respondent to reargue the matter of the prevailing party clause and the trial court determined that Petitioner was the prevailing party on Respondent s claim and Respondent was the prevailing party on Petitioner s compulsory counterclaim. It entered an order dated May 7, 2007, that became the subject of the appeal in Case No. 4D The Fourth District reversed both the January 10, 2007, order and the May 2

7 7, 2007, order, holding that the quoted clause was against public policy so that the Respondent was the prevailing party. It cited the case of P&C Thompson Bros. Construction Co. v. Rowe, 433 So.2d 1388, 1389 (Fla. 5 th DCA 1983) which case the Court stated held that a contract clause which required a claimant to recover 100% of its claim in order to be the prevailing party for purposes of attorney s fees was against public policy. The Fourth District also found that the quoted clause violated a public policy consideration underlying Florida Statute (7) which it stated was to provide a mutuality of attorney s fee remedy in contract cases, citing Walls v. Quick & Reilly, Inc., 824 So.2d 1016, 1019 (Fla. 5 th DCA 2002). The Fourth District also stated that such statutes also serve to level the playing field between parties of unequal bargaining power and sophistication, citing Precision Tune Auto Care, Inc. v. Radcliffe, 815 So.2d 708, (Fla. 4 th DCA 2002). There was no evidence at trial, nor did the Fourth District cite anything in the record, to factually support this statement in its opinion. Consequently, the Fourth District stated that the definition of prevailing party contained in the contract was not enforceable and instead through its opinion stated that the prevailing party would be determined by the significant issue test: We conclude that the Florida Supreme Court s significant 3

8 issue test for prevailing party cannot be contractually modified. Thus, Port-A-Weld is the prevailing party in this case and should be awarded all of its attorney s fees and costs; Padula is not entitled to recover any attorney s fees or costs. On the same date as its opinion was issued, the Fourth District entered an order, over Petitioner s prior written opposition, awarding Respondent its attorney s fees and costs (Appendix B) on appeal. In its motion for attorney s fees Respondent did not argue that the clause in Article VI(D) allowed it to be awarded attorney s fees as the prevailing party. Instead Respondent relied exclusively on another clause in the contract, Article V dealing with defaulting subcontractors and their failure to perform under the contract, that the Fourth District in its opinion did not find supported the award of attorney s fees. Timely filed motions for rehearing an rehearing en banc were denied. SUMMARY OF THE ARGUMENT The contract at Article VI, paragraph D provides that in order to recover attorney s fees and costs under the contract, a party must recover at least 75% of its claim. Respondent failed to do so, instead having 40% of its claim disallowed. There is no basis for the Fourth District to refuse to enforce these contractual requirements. The significant issues analysis on prevailing party cannot be used to rewrite the negotiated contractual provisions defining who is a prevailing party. 4

9 A party such as Respondent cannot be awarded attorney s fees on appeal when the Respondent failed to cite the specific basis for attorney s fees that the Fourth District used to award attorney s fees in this case. ARGUMENT I. THE DECISION BELOW DIRECTLY CONFLICTS WITH ESTABLISHED PRECEDENT THAT COURTS ARE REQUIRED TO ENFORCE ATTORNEY S FEES AND COSTS PROVISIONS IN CONTRACTS. In Price v. Tyler, 890 So.2d 246, 251 (Fla. 2004), the Supreme Court reiterated its longstanding holding that under Florida law, each part is responsible for its own attorney s fees unless allowed by contract or statute. By definition contained in the contract, the Respondent is not the prevailing party since it recovered only 60% of its claim, well below the 75% required by the contract for it to be the prevailing party. The Supreme Court, in the case of Lashkajani v. Lashkajani, 911 So.2d 1154, 1158 (Fla. 2005) stated as follows: Provisions in ordinary contracts awarding attorney s fees and costs to the prevailing party are generally enforced. Trial courts do not have discretion to decline to enforce such provisions even if the challenging party brings a meritorious claim in good faith. Contrary to the decision of the Fourth District, the Supreme Court has held that a prevailing party provision in a construction contract does not implicate 5

10 public policy considerations. See Fixel Enterprises, Inc. v. Theis, 524 So.2d 1015, 1017 (Fla. 1988). This same reasoning was also applied to a construction contract s prevailing party provision in Sullivan v. Galske, 917 So.2d 412 (Fla. 2 nd DCA 2006). The public policy case relied upon by the Fourth District, P&C Thompson Bros. Construction Co. v. Rowe, 433 So.2d 1388, 1389 (Fla. 5 th DCA 1983), has effectively been overruled by the Lashkajani and Fixel cases. The Fourth District has severed a portion of what was the negotiated provision concerning attorney s fees and costs and rewritten the contract in this regard contrary to longstanding precedent cited by the Fourth District in the case of Rybovich Boat Works, Inc. v. Atkins, 587 So.2d 519, 521 (Fla. 4 th DCA 1991). That case reaffirmed that courts may not rewrite, alter, or add to the terms of a written agreement nor may they substitute their judgment for one of the parties in order to relieve one from the alleged hardship of an improvident bargain. The Fourth District s decision is also in conflict with the case of B&H Construction and Supply Co. Inc. v. District Board of Trustees of Tallahassee Community College, Florida, 542 So.2d 382 (Fla. 1 st DCA 1989) in which the First District Court of Appeal at 387 upheld a contractual provision that allowed the Defendant in such case to be awarded attorney s fees merely upon the showing 6

11 of a breach of contract by the Plaintiff, despite the fact that the Plaintiff recovered an affirmative judgment. As provided in such case, the right to contractual attorney s fees is limited by the terms of the provision and general prevailing party analysis is not applied. Likewise the decision of the Fourth District ignores the specific contract language regarding award of costs. In this regard the opinion of the Fourth District is contrary to other cases on costs. In Maw v. Abinales, 463 So.2d 1245, 1247 (Fla. 2 nd DCA 1985), the Court stated that the award of costs is governed by the contract, despite F.S Furthermore, the Court in Nemours Foundation v. Gauldin, 601 So.2d 574, 576 (Fla. 5 th DCA 1992) held that the parties at the inception of their contractual relationship can agree as to the items of cost to be recovered, again notwithstanding the provisions of F.S The decision of the Fourth District is contrary to prior rulings of other panels in the Fourth District. In the case of Sumner Group, Inc. v. M.C. Distributec, Inc., 949 So.2d 1205, 1206 (Fla. 4 th DCA 2007) the Fourth District held that a trial court has no discretion to deny an award of contractual attorney s fees. See also Lakewood on the Green Villas Association, Inc. v. Pomerantz, 556 So.2d 505, 506 (Fla. 4 th DCA 1990), citing Blue Lakes Apartments Ltd v. George Gowing, Inc., 464 So.2d 705 (Fla. 4 th DCA 1985). 7

12 By its decision, and contrary to the decisions of the Supreme Court and other courts, the Fourth District has improperly failed to enforce the attorney s fees and costs provisions and improperly substituted its judgment as to what in its opinion the attorney s fees and costs provisions should be. II. THE DECISION BELOW DIRECTLY CONFLICTS WITH ESTABLISHED PRECEDENT THAT A REQUEST FOR APPELLATE ATTORNEY S FEES MUST STATE THE SPECIFIC BASIS FOR THE SAME. Rule 9.400(b), Fla. R. App. P., states in appropriate part that A motion for attorney s fees... shall state the grounds on which recovery is sought. The Supreme Court, in reviewing the language of Rule 9.400(b) in the case of United Services Automobile Association v. Phillips, 755 So.2d 921 (Fla. 2000), determined as follows: We interpret this language to require that a party seeking attorney s fees in an appellate court must provide substance and specify the particular contractual, statutory, or other substantive basis for an award of fees on appeal (emphasis added). The Fourth District, in the case of Hembd v. Dauria, 859 So.2d 1238 (Fla. 4 th DCA 2003), stated that the Supreme Court in the case cited...has taken a strict approach to the pleading requirement for Rule 9.400(b).... The Fourth District concluded its opinion in the Hembd case by stating that unlike pleading fees in the trial court, which is a lesser pleading requirement,...rule 9.400(b) explicitly 8

13 requires that the motion must state the grounds upon which recovery is sought. The holding of the Supreme Court in the United Services Automobile Association has been reiterated in other cases. See Brass & Singer, P.A. v. United Automobile Insurance Company, 944 So.2d 252, (Fla. 2006), and Home Depot v. Ferreira, 827 So.2d 371 (Fla. 1 st DCA 2002). In its Motion for Attorney s Fees, the Appellant specifically relied solely upon Article V, paragraph H, of the contract at issue concerning defaulting subcontractors and their failure to perform for an award of appellate attorney s fees. The opinion of the Fourth District in the consolidated opinion did not find and specifically rejected on page 7 of the opinion that Article V of the contract could form the basis for attorney s fees ( We have considered all other arguments raised by the parties and find them to be without merit or need for further explanation... ). There is no authority for the Fourth District to disregard the aforementioned decisions of the Supreme Court to award appellate attorney s fees to Respondent. CONCLUSION This Court should review this case because of the express and direct conflict created by the Fourth District, the importance of contracts being enforced as negotiated at arms length, and the importance of not allowing clear and unambiguous 9

14 provisions of a contract to be rewritten by the courts. Respectfully submitted, JAMES B. BOONE, ESQ. Attorney for Petitioner P.O. Box Weston, FL (954) /(954) (fax) jamesbboone@earthlink.net BY: /s/ James B. Boone, Esq. (Fla. Bar No ) CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the foregoing was mailed to Herbert B. Dell, Esq., Herbert B. Dell, P.A., Attorney for Respondent, 5001 S. University Drive, Suite J, Fort Lauderdale, FL 33328, this 20 th day of August, /s/ JAMES B. BOONE, ESQ. CERTIFICATE OF COMPLIANCE WITH FLORIDA RULE OF APPELLATE PROCEDURE I HEREBY CERTIFY that the foregoing brief has been prepared and printed in Times New Roman 14 point font in accordance with Florida Rule of Appellate Procedure /s/ JAMES B. BOONE, ESQ. 10