SUPREME COURT OF FLORIDA. Case No. SC

Transcription

1 SUPREME COURT OF FLORIDA Case No. SC BRUCE BERNSTEIN, Petitioner, vs. HARVEY GOLDMAN, Respondent, PETITIONER'S BRIEF ON JURISDICTION Petition to Review Decision of the Fourth District Court of Appeal Patrick A. Moran, Esq. Ari C. Shapiro, Esq. RUDEN, McCLOSKY, SMITH, SCHUSTER & RUSSELL, P.A. 200 East Broward Boulevard, 15 th floor P.O. Box 1900 Fort Lauderdale, Florida (954) ,

2 TABLE OF CONTENTS Page TABLE OF CONTENTS... ii TABLE OF AUTHORITIES...iii PREFACE... iv STATEMENT OF THE FACTS AND THE CASE... 1 SUMMARY OF ARGUMENT... 3 ARGUMENT... 4 THE OPINION OF THE FOURTH DISTRICT CONFLICTS WITH THE RULE THAT A TORT PLAINTIFF MAY ONLY RECOVER FOR DAMAGES PROXIMATELY CAUSED BY THE DEFENDANT'S BREACH OF A FIDUCIARY DUTY CONCLUSION... 7 CERTIFICATE OF SERVICE... 8 SIZE AND STYLE OF TYPE... 8 APPENDIX... A ii

3 TABLE OF AUTHORITIES Page Goldfarb v. Robertson, 82 So. 2d 504 (Fla. 1955)... 5 Gracey v. Eaker, 837 So. 2d 348 (Fla. 2002)... 4 Surety Mortgage v. Equitable Mortgage Resources, Inc., 534 So. 2d 780 (Fla. 2nd DCA 1988)... 3, 5 Vine v. Scarborough, 517 So. 2d 726 (Fla. 3rd DCA 1987)... 5 Other Authorities Fla. R. App. P iv , Fla. Stat , Fla. Stat... 2 iii

4 PREFACE This is a petition to invoke the discretionary review jurisdiction of this Court under Fla. R. App. P based on an express and direct conflict between the decision of the Fourth District Court of Appeal in this case compared to decisions of the Second and Third Districts on the same issue of law. The Respondent, HARVEY GOLDMAN, will be referred to herein as "Goldman." The Petitioner, BRUCE BERNSTEIN, will be referred to herein as "Bernstein." The Opinion will be referred to as "A-p.." iv

5 STATEMENT OF THE FACTS AND THE CASE This case arises from an investment in a television show and motion pictures studio in Puerto Rico that went bad. Harvey Goldman's girlfriend and Bruce Bernstein were neighbors in Boca Raton, Florida. Goldman and Bernstein met. Bernstein was a licensed securities broker. Bernstein invited Goldman to Puerto Rico to investigate the opportunity. Goldman determined to make an investment. He did so. Goldman wired $15,000 from his own account and $40,000 from three different accounts held in his mother's name. The investment ran out of money and failed to pay key obligations, including the salary of the television show's star, Martin Sheen. Sheen left the venture to portray the President of the United States in the popular West Wing series. The investment was a loss. Goldman sued four defendants, including Bernstein. Three of those defendants defaulted. Only Bernstein defended the allegations. Among the three defaulting defendants were the companies which received the money from all investors, including Goldman. One of the other defendants was the principal of those companies who was responsible for the operation of those companies. Bernstein neither received the money from Goldman nor was in charge of operating the business. 1

6 Goldman sued Bernstein for Civil Theft under Florida Statutes et seq., for alleged breach of the Florida Security and Investor Protection Act, Florida Statutes et seq., and for alleged breach of a general fiduciary duty. Trial took place over a four-day period. Defendant Bernstein relied upon his crossexamination and rebuttal during the presentation of Plaintiff's case. Bernstein rested at the end of the presentation of Goldman's case. The jury deliberated for several hours, asked several questions of the court, and asked to review documentary evidence referred in the presentation. The jury returned a no cause of action in favor of Bernstein concerning the allegations of Civil Theft and breach of the Florida Security and Investor Protection Act. The jury found a breach of a fiduciary duty by Bernstein but found that no damages should be awarded as a result of that breach. Goldman appealed the award of zero damages for breach of fiduciary duty. The Fourth District Court of Appeal reversed the decision of the jury and remanded the case for a new trial as to damages. 2

7 SUMMARY OF ARGUMENT The Fourth District erred and created conflict in holding that damages must be awarded if there is a finding of a breach of fiduciary duty regardless of whether there has been proof of damages proximately caused by that breach. The opinion of the Fourth District conflicts with decisions of the District Courts of Appeal for the Second and Third Districts and long recognized law in this state that recovery for breach of fiduciary duty requires the proof of three distinct elements: (1) Existence of the duty owned to plaintiff, plus (2) breach of that duty, plus (3) damages arising as the proximate cause of that breach. The opinion of the Fourth District has eliminated the third element of proximate cause and supplanted it with an assumption that if a fiduciary duty exists and has been breached, then a jury must award damages regardless of the proof or lack of proof concerning proximate cause for the defendant's alleged loss. The opinion of the Fourth District creates the rule that a jury award of zero damages for breach of a fiduciary duty is patently inconsistent and requires a new trial for damages. This is in conflict with the Second District in Vine v. Scarborough, 517 So. 2d 726 (Fla. 3rd DCA 1987) and with the Third District in Surety Mortgage v. Equitable Mortgage Resources, Inc., 534 So. 2d 780 (Fla. 2nd DCA 1988). 3

8 ARGUMENT THE OPINION OF THE FOURTH DISTRICT CONFLICTS WITH THE RULE THAT A TORT PLAINTIFF MAY ONLY RECOVER FOR DAMAGES PROXIMATELY CAUSED BY THE DEFENDANT'S BREACH OF A FIDUCIARY DUTY The Fourth District held that an award of zero damages by a jury that found a breach of a fiduciary duty by Bernstein was "patently inadequate." Although the Court conceded that "inadequate verdicts are not per se improper," the decision of the Court would establish that exact rule in the Fourth District and would stand in stark contrast to the rules of the Second District and the Third District. There are three separate and distinct elements for an award of damages for breach of a fiduciary duty, each of which must be separately proven for recovery: (1) Existence of a fiduciary duty, (2) breach of that duty, and (3) damages that were the proximate cause of the breach of that duty. Gracey v. Eaker, 837 So. 2d 348, 353 (Fla. 2002). The jury found that elements (1) and (2) existed, but did not find that any damages were proximately caused by the breach of Bernstein's duty. It was error for the Fourth District to assume that the jury's award after three days of trial and hours of deliberation was the result of jury confusion. The jury affirmatively determined to award zero dollars in damages. This is not surprising given the fact that Bernstein was only one of four defendants. The other three were found liable under all counts brought against them by default. 4

9 They did not appear to defend the allegations. The Fourth District Court did not even consider whether the jury that had heard testimony for three days and deliberated for hours could have decided that Bernstein's breach of fiduciary duty was not the proximate cause of Goldman's alleged damages. The Fourth District Court did not consider that the jury could have decided that one or more of the other defendants found liable proximately caused plaintiff's alleged damages. It is axiomatic that the appellate court is not to substitute itself for the fact finder who heard the testimony and judged the veracity of the witnesses at trial. Goldfarb v. Robertson, 82 So. 2d 504, 506 (Fla. 1955). The Second District has upheld the award of zero damages under Surety Mortgage v. Equitable Mortgage Resources, Inc., 534 So. 2d 780 (Fla. 2nd DCA 1988) where the court held that it is not necessary to grant a new trial where the jury returns a zero verdict and that where conflicting evidence exists concerning damages and reasonable men could believe that Plaintiff sustained no damages, a zero award will be upheld. The decision of the Fourth District is also in conflict with the Third District. In Vine v. Scarborough, 517 So. 2d 726 (Fla. 3rd DCA 1987), the court refused to reverse a finding by the jury of a breach of fiduciary duty followed by an award of zero damages because finding a breach is not a finding that the plaintiff suffered damages from that breach. The third element of a tort award must be proven, i.e., 5

10 that the damages complained of by the Plaintiff were proximately caused by the Defendant in question. It was not inconsistent for the jury to find breach of a fiduciary duty by the Defendant followed by an award of zero damages to Goldman. There are three elements to granting an award for breach of fiduciary duty and Goldman only proved two of those elements. Goldman failed to convince the jury that the damages it alleged were proximately caused by Bernstein's breach. Goldman failed to convince the jury that Bernstein's breach rather than the breaches and liability of the other three defendants was the proximate cause of Goldman's alleged damages. The rule of the Fourth District would throw out the need to prove that a plaintiff's damages were proximately caused by the defendant's breach of a duty in favor of a presumption that the jury was confused. There is nothing to suggest that this is a proper rule. 6

11 CONCLUSION For the foregoing reasons, it is respectfully submitted that this Court should accept jurisdiction. Respectfully submitted, RUDEN, McCLOSKY, SMITH, SCHUSTER & RUSSELL, P.A. 200 East Broward Boulevard, 15 th floor (33301) Post Office Box 1900 Fort Lauderdale, Florida (954) , ; Fax: (954) By: Patrick A. Moran Florida Bar Number Ari C. Shapiro Florida Bar Number

12 CERTIFICATE OF SERVICE I certify that a copy hereof has been furnished to counsel of record as noted below, by U. S. Mail, on September 19, this brief. CERTIFICATE OF COMPLIANCE Undersigned counsel certifies that TIMES NEW ROMAN, 14 pt., is used in RUDEN, McCLOSKY, SMITH, SCHUSTER & RUSSELL, P.A. 200 East Broward Boulevard, 15 th floor (33301) Post Office Box 1900 Fort Lauderdale, Florida (954) , ; Fax: (954) Counsel of Record Richard A. Kupfer, Esq Corporate Way, Suite 106 West Palm Beach, Florida Counsel for Goldman Mark R. Osherow, Esq Glades Rd. Ste 650 Boca Raton, Florida Counsel for Goldman By: Patrick A. Moran Florida Bar Number Patrick A. Moran, Esq. Ari C. Shapiro, Esq. Ruden, McClosky P.O. Box 1900 Fort Lauderdale, Florida Counsel for Bernstein Thomas D. Hall, Clerk Supreme Court of Florida 500 South Duval Street Tallahassee, Florida (850)