STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA CONDOMINIUMS, TIMESHARES AND MOBILE HOMES

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1 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA CONDOMINIUMS, TIMESHARES AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION - HOA DAVID HOLT, DEBRA DE BELL, and MICHAEL REAGAN, Petitioners, v. Fee Case No Rel. Case No LEGENDS COUNTRY CLUB COMMUNITY ASSOCIATION, INC., Respondent. / FINAL ORDER ON RESPONDENT S MOTION FOR ATTORNEY S FEES AND COSTS On August 31, 2011, Legends Country Club Community Association, Inc. (the Association), the legal entity responsible for the operation of Legends Country Club Community located in Seminole County, Florida, moved for an award of $3, in attorney s fees and costs from David Holt, Debra Bell and Michael Reagan (Petitioners). By order entered on September 9, 2011, Petitioners were directed to file a response to the Association s motion, and Petitioners filed a response on September 28, Findings This fees case arises from arbitration case number In the underlying case, the petition alleged that the Association improperly failed to conduct the annual election because the quorum necessary was improperly calculated, members were not allowed to speak and the meeting was not reconvened. The petition also alleged that the Association improperly denied inspection of records. 1

2 The online records of the United States Postal Service showed the Association s Registered Agent received the Order Requiring Answer via certified mail, return receipt requested, on June 29, On July 14, 2010, the Association filed a motion for an extension of time to answer, stating it did not receive the attachments to the Petition until July 13, The Association s motion was granted, requiring the Association to file an Answer by August 2, On July 28, 2011, Petitioners filed a motion to voluntarily dismiss the petition. On August 1, 2011, two business days after Petitioners moved for voluntary dismissal, the Association filed a motion to dismiss the petition. On August 5, 2011, a Final Order of Dismissal was entered granting Petitioners motion to voluntarily dismiss the petition. Based upon the applicable administrative rule, the Association s motion to dismiss was not addressed. Conclusions Despite the fact that Petitioners moved for voluntary dismissal before the Association filed any pleading in the case other than a motion for extension of time, the Association argues it is the prevailing party. Pursuant to section (4)(k), Florida Statutes, the prevailing party in an arbitration proceeding shall be awarded the costs of the arbitration and reasonable attorney s fees in an amount determined by the arbitrator. A party is a prevailing party if it succeeds on a significant issue in the arbitration and achieves some of the benefit sought in bringing the action. See Moritz v. Hoyt Enterprises, Inc., 604 So. 2d 807, 809 (Fla. 1992) citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). However, when a case becomes moot or there is a voluntary dismissal, there is no decision on the merits and the determination of whether there is a prevailing party must be determined by the particular facts of the case and the timing 2

3 of the act that caused the action to be dismissed. The Laurels at Margate Condo. Ass n, Inc. v. Slonecky, Arb. Case No F, Final Order on Motion for Attorney s Fees (July 28, 1994). The general rule is that when a plaintiff voluntarily dismisses an action, the defendant is the prevailing party within the meaning of statutory or contractual provisions awarding attorney's fees to the prevailing party in litigation. Alhambra Homeowners Ass n, Inc. v. Asad, 943 So. 2d 316, 318 (Fla. 4 th DCA 2006) (citations omitted). Courts have permitted attorney s fees when the plaintiff has taken a voluntary dismissal at various stages of the proceeding. See, e.g., Stuart Plaza, Ltd. v. Atl. Coast Dev. Corp. of Martin County, 493 So. 2d 1136, (Fla. 4th DCA 1986) (On the day of trial, plaintiff appellee voluntarily dismissed its case without prejudice; fees awarded to defendant appellant); Landry v. Countrywide Home Loans, Inc., 731 So. 2d 137 (Fla. 1st DCA 1999) (defendant appellant filed motion for summary judgment, and thereafter plaintiff appellee filed motion to strike motion for summary judgment and for voluntary dismissal; order denying attorney s fees to defendant appellant reversed). In Dolphin Towers Condo. Ass n, Inc. v. Del Bene, 388 So. 2d 1268 (Fla. 2d DCA 1980), the court held that the condominium association was the prevailing party for purposes of an award of attorney s fees when the unit owners who filed the case voluntarily dismissed their case against the association. 1 The case had proceeded to a nonjury trial when unit owners voluntarily dismissed the action after some evidence had been presented. 1 The case construed the 1979 precursor to the fee shifting provision in section , Fla. Stat. 3

4 In Barrett v. Lakebridge Condo. Ass n, Inc., Arb. Fee Case No , Final Order on Motion for Attorney s Fees and Costs (July 30, 2008), the Association sought prevailing party attorney s fees and costs after Petitioners voluntarily dismissed their petition when the case was ready for decision on the merits. Numerous pleadings had been filed by each party. The Association was determined to be the prevailing party, and attorney s fees were awarded. However, none of the cases discussed above, all of which were cited by the Association in support of its motion for award of fees and costs, granted an award of attorney s fees and costs when the voluntary dismissal occurred before the opposing party had filed any substantive pleading. Thus, those cases are distinguishable from the case at hand. In the instant case, the only pleading filed by the Association before Petitioners moved for voluntary dismissal was the Association s motion for extension of time to file an Answer. 2 The Association is not the prevailing party in this case. Compare Bay Harbor Condo. Ass n, Inc. v. Innocenti, Arb. Fee Case No , Final Order on Motion for Attorney s Fees (Dec. 12, 2001) (Association filed answer to underlying petition, then association advised arbitrator that petitioner would not be pursuing petition. Petitioner did not indicate intent to pursue arbitration, and case was dismissed. No adjudication on merits, no relief provided or obtained by either party, and from record, it was unknown why petitioner did not pursue petition, and decision quite possibly was unrelated to merits of dispute. Thus, association was not prevailing party, 2 According to the motion, the Association required additional time because it had not received the attachments which accompanied the petition. However, there is no indication the Association requested the Division to re-send the attachments, so the reason the Association did not receive the attachments is a mystery. The certified mail return receipt indicates the Association s registered agent received the Order Requiring Answer with the accompanying attachments on June 29,

5 and motion for attorney s fees and costs denied.) with Thrasher v. Octagon Towers Condo. Ass n, Inc., Arb. Fee Case No , Final Order on Motion for Attorney s Fees (Aug. 13, 2004) (Final order acknowledging voluntary dismissal entered and association moved for attorney s fees. Bay Harbor distinguished. Thrasher s motion for temporary injunctive relief in arbitration was denied as was his motion for rehearing of denial and circuit court also denied motion for temporary injunctive relief. Voluntary dismissal determined to be based on inability to obtain injunctive relief, and association determined prevailing party and entitled to attorney s fees.). Based on the foregoing, it is ORDERED: The Association s motion for award of attorney s fees and cost is DENIED. DONE AND ORDERED this 19 th day of October, 2011, at Tallahassee, Leon County, Florida. Glenn Lang, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida Telephone: (850) Facsimile: (850) Trial de Novo This decision shall be binding on the parties unless a complaint for trial de novo is filed in accordance with section , Florida Statutes. 5

6 CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing final order was mailed by U.S. mail, postage prepaid, this 19 th day of October, 2011, to: David Holt 1379 Legendary Blvd. Clermont, FL Qualified Representative Rania A. Soliman, Esq. Taylor & Carls, P.A. 150 N. Westmonte Drive Altamonte Springs, FL Attorney for the Respondent Glenn Lang, Arbitrator 6