IN THE SUPREME COURT STATE OF FLORIDA CASE NO. SC08-426

Transcription

1 IN THE SUPREME COURT STATE OF FLORIDA CASE NO. SC CONSTANTIN BARTSOCAS, and KIKI VASILICI BARTSOCAS, DCA Case Nos. 4D ; 4D ; 4D (Cons.) Petitioners, v. ACE J. BLACKBURN, JR., JOAN A WAGNER, CHRIS A. ECONOMOU and GUS MORFIDIS as Curators of the Estate of Konstantinos Boulis a/k/a GUS BOULIS, Deceased, Respondents. / PETITIONERS BRIEF ON JURISDICTION ON REVIEW FROM THE DISTRICT COURT OF APPEAL, FOURTH DISTRICT, STATE OF FLORIDA JOHN R. HARGROVE, ESQ. CAROL A. GART, ESQ. GORDON HARGROVE & JAMES, P.A. Counsel for Petitioners 2400 East Commercial Boulevard Suite 1100 Fort Lauderdale, FL Telephone: (954)

2 TABLE OF CONTENTS TABLE OF AUTHORITIES ii JURISDICTIONAL STATEMENT STATEMENT OF THE CASE AND FACTS SUMMARY OF ARGUMENT ARGUMENT CONCLUSION CERTIFICATE OF SERVICE CERTIFICATE OF COMPLIANCE WITH FONT SIZE i

3 TABLE OF AUTHORITIES Cases Argonaut v. May Plumbing Co., 474 So. 2d 212 (Fla. 1985)... 3 Bartsocas v. Blackburn, 33 Fla. L. Weekly D677b (Fla. 4th DCA Mar. 5, 2008)... 4 Blackburn v. Bartsocas, 33 Fla. L. Weekly D 369a (Fla. 4th DCA Jan. 30, 2008)... 3 Blackburn v. Bartsocas, 32 Fla. L. Weekly D 2923a (Fla. 4th DCA Dec. 12, 2007)... 3 Broward Builders Exchange, Inc. v. Goehring, 231 So. 2d 513 (Fla. 1970)... 7 France v. Ross, 165 So. 2d 780 (Fla. 3d DCA 1964)... 7 Havoco of America, Ltd. v. Hill, 790 So. 2d 1018 (Fla. 2001)... 3 Miami Beach First National Bank v. Borbiro, 201 So. 2d 571 (Fla. 3d DCA 1967)... passim Sonneman v. Tuszynski, 139 Fla. 824, 191 So. 18 (1939)... 3 Statutes Fla. Const. Art. V, Florida Statutes (1)... 5 Florida Statutes Chapter Other Authorities 31 Williston on Contracts 79:21 (4th ed. 2007)... 5 ii

4 31 Williston on Contracts 79:25 (4th ed. 2007)... passim Rules Fla. R. App. P (a)(2)(a)(iv)... 1 iii

5 JURISDICTIONAL STATEMENT Petitioners seek discretionary conflict review pursuant to Fla. Const. Art. V, 3 (b) and Fla. R. App. P (a)(2)(a)(iv). A Broward County jury awarded petitioners $1.2 million as unjust enrichment compensation for twenty-one years of continuous work in a restaurant enterprise. The Fourth District characterized the unjust enrichment award as nothing more than a wage claim and reduced the damages accordingly under the two year statute of limitations governing wages. The question presented is when does a claim for compensation accrue when an agreement for continuous services over an indefinite period does not fix a time for payment? Professor Williston teaches that when the parties agree to continuous services with no time fixed for compensation, a claim for unpaid compensation does not accrue until performance is completed. 31 Williston on Contracts 79:25 (4th ed. 2007). The Third District -- in line with the Williston treatise -- holds that the claim accrues when the work is completed. At that point the obligation to pay matures. Miami Beach First National Bank v. Borbiro, 201 So. 2d 571 (Fla. 3d DCA 1967). The Fourth District, however, has now held that the statute accrues when services are performed, creating the undesirable result of compelling parties to pursue litigation from time to time in order to protect their rights. The logical extension of 1

6 the Fourth District s decision is to force litigation every two years even though the services have not been fully performed. STATEMENT OF THE CASE AND FACTS Petitioners and Gus Boulis -- Greek immigrants and lifelong friends -- worked side-by-side continuously and indefinitely from 1979 to develop restaurants in the Florida Keys and south Florida, agreeing to take little compensation with the promise of a big payday in the future -- a common business arrangement between those seeking to roll today s profits into tomorrow s development. The successful handshake relationship came to an abrupt end in 2001 when Boulis was tragically murdered in Fort Lauderdale. (A 1) Over that entire stretch petitioners invest[ed] their time and effort with little, if any, compensation and at some point in time would share in the proceeds and profits of the partnership. (A 1) Although the jury rejected petitioners claim of partnership (there was no written partnership contract), they nevertheless awarded petitioners in excess of $1.2 million on their alternative claim of unjust enrichment. (A 1) On appeal, the Fourth District viewed the unjust enrichment verdict as nothing more than an unpaid wage claim and limited the damages to two years per the limitation period on wage claims under Florida Statutes Chapter 95. Thus, the Fourth 2

7 District s holding is contrary to the Williston rule and the holding of the Third District in Borbiro. (A 1) Before analyzing the jurisdictional conflict, it should be noted that the Fourth District s opinion has been twice amended. Initially, the court issued an opinion challenging the origination of the term sweat equity and stated that the term was a creation of [petitioners ] forensic certified public accountant and finds no basis in this state s jurisprudence. Blackburn v. Bartsocas, 32 Fla. L. Weekly D 2923a (Fla. 4th DCA Dec. 12, 2007). Petitioners requested rehearing on the basis of this Court s opinion in Havoco of America, Ltd. v. Hill, 790 So. 2d 1018, 1026 (Fla. 2001), which expressly recognized sweat equity as services and labor invested in property to the benefit of another, based on its prior decision in Sonneman v. Tuszynski, 139 Fla. 824, 191 So. 18 (1939). The panel deleted the statement in the opinion that sweat equity is a creation of the forensic accountant, and issued a revised second opinion. Blackburn v. Bartsocas, 33 Fla. L. Weekly D 369a (Fla. 4th DCA Jan. 30, 2008) (on motion for rehearing). Subsequently, the Fourth District issued a third opinion to correct its ruling on prejudgment interest. In that opinion, the court reinstated petitioners award of prejudgment interest in accord with this Court s ruling in Argonaut v. May Plumbing Co., 474 So. 2d 212 (Fla. 1985), which says that once the 3

8 disputed damage claim is liquidated by the verdict, prejudgment interest is calculated from the date of the loss. (A 1); Bartsocas v. Blackburn, 33 Fla. L. Weekly D677b (Fla. 4th DCA Mar. 5, 2008) (on amended motion for rehearing). It is the third decision issued by the Fourth District which petitioners now challenge in this Court. SUMMARY OF ARGUMENT The Fourth District created conflict on a fundamental point regarding accrual of a cause of action for compensation on an agreement to render continuous services with no time fixed for compensation. The majority view, as expressed by Professor Williston and by the Third District in Miami Beach First National Bank v. Borbiro, 201 So. 2d 571 (Fla. 3d DCA 1967), is that when a party agrees to provide continuous services over an indefinite period with no fixed time for payment, the claim for compensation -- even if for wages -- does not accrue until the services are completed. In Professor Williston s view, the failure to fix a time for compensation casts an unfair burden on a plaintiff to determine the exact moment when the right of action accrues even though the work is not completed. 31 Williston at 79:25. Adopting the Fourth District s view creates the very problem which Professor Williston describes and, of course, conflicts with the Third District. 4

9 ARGUMENT Florida Statutes (1) states that [a] cause of action accrues when the last element constituting the cause of action occurs. (Emphasis added). Consistent with (1), the Third District in Miami Beach First National Bank v. Borbiro, 201 So. 2d 571 (Fla. 3d DCA 1967), held that where a party performs continuous services over an indefinite period with no fixed time for compensation, the claim for compensation does not accrue until the work is completed. If a contract, express or implied, is an entire one for continuous services over an indefinite period of time and does not fix a time when compensation shall be payable, the Statute of Limitations does not run until the employment is ended, because the action does not accrue until the termination of the employment. * * * The plaintiff was thus entitled to recover for the value of the services she rendered for the full period of her employment. Id. at (emphasis added). Borbiro reflects the majority view expressed in 31 Williston at 79:25. Addressing the policy underpinning the rule, the Williston treatise notes that [t]o compel the injured party, in order to protect its rights, to bring actions from time to time is undesirable. Id. at 79:21. Thus, a 5

10 plaintiff may recover damages based on the entire performance due from the defendant with the claim not accruing until the arrangement ends. Id. Here the arrangement ended when Boulis died, as the jury found. The result of the precedent created in this case underscores the warning expressed by Professor Williston. Where no fixed time is set for payment, it would impose an unfair burden to force litigation while the parties are still performing. 31 Williston at 79:25. Consistent with Williston s view, the Third District resolved the point in Borbiro and held that a claim for compensation accrues when the services are completed or have been terminated. Borbiro involved a housekeeper who sued for the value of her services rendered to a decedent. Id. at 571. Like the working relationship between Boulis and petitioners, the housekeeper had agreed to work for an indefinite period of time with payment to be deferred to a later date. Nothing was in writing. Work for the decedent spanned about three years and the employment terminated shortly before his death. Id. On decedent s death, plaintiff sought compensation for the value of her services. The estate denied her claim and she filed suit, obtaining a judgment for the full amount. Id. at 572. On appeal, the estate argued that only the last year s payment was due because the first two years payments were 6

11 barred by the then one-year statute of limitations for wages. Id. The appellate court disagreed. As part of its analysis the court noted that the housekeeper was unable to prove an express agreement to pay plaintiff upon the decedent s death. Id. But the key to the analysis was that her services were continuous; that she had worked for him for an indefinite period; and that there was no fixed time for payment. The court also noted that the evidence was sufficient to raise an implied promise to pay plaintiff the reasonable value of her services. In other words, no express agreement was necessary. The same fact pattern is presented here. Before going further with Borbiro, however, a point should be made regarding the Fourth District s characterization of petitioners services as nothing more than a wage claim. Petitioners do not concede that the claim for unjust enrichment is one merely for wages. See Broward Builders Exch., Inc. v. Goehring, 231 So. 2d 513 (Fla. 1970); France v. Ross, 165 So. 2d 780 (Fla. 3d DCA 1964). But that is an issue more appropriately addressed on the merits should the Court accept jurisdiction. The limited focus here is the conflict with Borbiro on the accrual issue regardless of the characterization of petitioners services. The Fourth District s opinion reflects that the value of petitioners continuous services to the decedent was rolled 7

12 forward for an indefinite period, and that there was no fixed time for payment. (A 1) Their agreement was to defer a substantial part of their compensation until an indefinite future date in order to maximize capital for future expansion. (A 1) This arrangement between the parties ended upon the decedent s date of death -- not at any time before. (A 1) In Borbiro, the same cause of action with the same material facts accrued when the decedent died. The court so ruled because of sound policy on the issue of accrual. The agreement was one for continuous services over an indefinite period of time with no fixed time when compensation was payable. The claim for compensation did not accrue until the continuous services were completed. Borbiro and the Fourth District s decision directly and expressly conflict on this very point. CONCLUSION The conflict should be resolved by this Court because every case involving services rendered with the promise of future payment will now be in a state of confusion, with the result turning upon the mere fact of geography. There will be one analysis for cases arising in the Third District, another for cases arising in the Fourth District, and given that authority split it is anyone s guess for cases arising elsewhere. Under the Fourth District s analysis, the last vestige of a hand- 8

13 shake working agreement between friends will have passed unless the issue is now addressed. This Court is urged to consider the conflict further and allow merits briefs to be submitted. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished by United States Mail on this 22nd day of April, 2008 to: Glenn J. Waldman, Esq. and Craig Trigoboff, Esq., WALDMAN FELUREN HILDEBRANDT & TRIGOBOFF, P.A., 2200 North Commerce Parkway, Suite 202, Weston, FL CERTIFICATE OF COMPLIANCE WITH FONT SIZE The undersigned hereby certifies that the font of this brief is Courier New 12. GORDON HARGROVE & JAMES, P.A. Counsel for petitioners 2400 East Commercial Boulevard Suite 1100 Fort Lauderdale, Florida Telephone: Facsimile: Doc 176 By: John R. Hargrove JOHN R. HARGROVE Florida Bar No CAROL A. GART Florida Bar No