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 DIANNE BESSETTE, Petitioner, v. OASIS AT PALM AIRE ASSOCIATION, INC., Fee Case No Fee Case No Rel. Case No Respondent. / FINAL ORDER ON CROSS-MOTIONS FOR ATTORNEY S FEES AND COSTS On December 1, 2015, Dianne Bessette, Petitioner, filed a motion for an award of $2, in attorney s fees and $ in costs based upon the underlying arbitration case number On December 2, 2015, Oasis at Palm Aire Association, Inc. (the Association), located in Broward County, filed a cross motion to be awarded attorney s fees in the amount of $2, and a renewed motion for sanctions. Each party filed responses in opposition to the other s motion. In the underlying case number , a Final Order of Dismissal due to Mootness was entered on November 23, The dispute is whether Petitioner is the prevailing party in the arbitration. Relevant Procedural History The homeowners attempted twice to remove Petitioner from the board of directors by serving written recall agreements on the Association; the first was served on the board on September 22, 2015, and the second was served on October 2, 2015.

2 Petitioner filed a petition for arbitration on September 30, 2015, only challenging the first recall. There are 167 voting interests in the Association, so 89 ballots in favor of recall were needed to remove Petitioner. Conclusions of Law Prevailing Party Pursuant to Section , Florida Statutes, any recall dispute filed with the department pursuant to Section (10), Florida Statutes, shall be conducted by the department in accordance with the provisions of sections (2)(j) and , Florida Statutes, and the rules adopted by the Division. In addition, the department shall conduct mandatory binding arbitration of election disputes between a member and an association pursuant to Section and rules adopted by the division. Section (4)(k), Florida Statutes, provides that 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, contrary to what the Association suggests, the prevailing party analysis is not so one-dimensional in this case. Salvemini v. Westridge Homeowners Association, Inc., Arb. Fee Case No , Final Order on Motions for Attorney s Fees and Costs (September 12, 2014) citing (Visyak v. Fairway Cove Homeowners' Ass'n, Inc., Arb. Case No , Final Order Denying Attorney's Fees and Costs (February 10, 2011) and Ringler v. Tower Forty One Ass'n, Inc., Arb. 2

3 Case No , Final Order on Attorney's Fees and Costs (June 20, 2006)). Prior arbitration cases have held that "a petitioner can be found to 'prevail' even when they do not obtain the relief that they request." Id. The first recall agreement garnered 89 votes in favor of recall but 21 of the ballots had expired and were therefore, invalid. At the meeting called to consider the first recall, held on September 25, 2015, the Association did not mention the invalid ballots and certified the recall removing Petitioner from the board. By the time of service of the second recall agreement which was merely eight days later, the homeowners voting for recall had corrected their error, gathered 91 recall ballots all of which were executed and viable. At the meeting called to consider the second recall held on October 6, 2015, the Association again certified the recall. Petitioner could not find a reason to challenge the certification of the second recall and she was removed from the board. Petitioner s Claim to be Prevailing Party Petitioner is requesting prevailing party status because in advance of filing the petition for arbitration on September 30, 2015, counsel for Petitioner repeatedly warned the Association that 21 of the 89 ballots in favor of Petitioner s removal had expired were invalid and should not be counted as votes in favor of the recall. Reducing the ballots by 21 left 68 votes in favor of recall, less than a majority of the voting interests and too few to recall Petitioner. Petitioner contends that as a direct result of having ignored the warning of the faulty ballots, the Association certified the first recall attempt, forcing Petitioner to challenge the certification by filing a petition for arbitration. 3

4 The Association opposes Petitioner being designated prevailing party for three reasons: 1) the petition was dismissed as moot, never reached the merits of the arbitration and Petitioner was not awarded any relief; 2) Petitioner s speculation that one of the board members may have been delinquent in his monetary obligations to the Association which may have invalidated the second recall is frivolous; and 3) Petitioner failed to challenge the certification of the second recall. The Association s arguments in are not well taken. There is no dispute that Petitioner on many occasions, prior to her filing the petition for arbitration, warned the Association it had received only 68 valid ballots in favor of recall, too few to remove Petitioner from the board. Despite this, the Association held a meeting to consider the recall where the board of directors never raised the issue and nonetheless certified Petitioner s removal. As the ruling in Shaul Ringler, et al. v. Tower Forty One Association, Inc., Arb. Fee Case No , Final Order on Attorney s Fees and Costs (June 20, 2006), instructs and which the undersigned finds convincing is, it was because of the failure of the board to properly proceed after receipt of the faulty recall agreement which caused the Petitioner to file the petition in the first place. It was only as a result of the Association s decision to ignore the warnings that Petitioner incurred the expense of hiring counsel and incurring costs. Indeed, in holding a meeting to consider the second recall agreement, the Association was admitting it committed an error in certifying the first recall because a fortiori, an Association cannot recall a member of the board who has already been recalled. The second meeting where the Association for the second time certified the 4

5 recall negated Petitioner s earlier removal from the board (whether acknowledged publicly or not) and Petitioner had regained her seat on the board if ever so briefly. This granted the relief requested in Petitioner s petition. To this extent, Petitioner did indeed prevail. The Association s Claim to be Prevailing Party The Association claims entitlement to the award of fees and costs because Petitioner refused to withdraw her petition for arbitration despite knowing the second recall had been served which automatically mooted the first recall attempt. This allegedly would have saved the Association the expense and fees associated with having to file a motion to dismiss the petition based on the service of the second recall. Weak though this argument is, it is one perspective. From the arbitrator s perspective, once the unit owners quickly started soliciting recall ballots again to make up for the ones which had expired, the Association could have filed a suggestion of mootness and noted Petitioner s reinstatement to the board all based upon a final acknowledgement that 21 of the first ballots were fatally flawed. Alternatively, the Association filed its motion to dismiss due to the service of the second recall and the decision to certify the second effort. In either case, the need to file a motion to dismiss arose from the Association s failure to take heed to Petitioner s warning and abandon moving forward on the first recall agreement. The Association knew or could have known by just reviewing the first 89 ballots, that 21 were useless because they had expired. A cursory review of the ballots would have revealed this truth and saved both parties fees and costs. Instead, the Association proceeded to meet concerning the certification of the first recall without questioning the 5

6 facial validity of the ballots. The primary purpose of holding a meeting to consider the recall is for the board to determine the validity of the ballots cast and to fail to do so in its rush to remove Petitioner, will not support a finding by the arbitrator that the Association is the prevailing party. Essentially, the Association wants to be named prevailing party to be awarded fees and costs because it mishandled the service of the first recall agreement. Under the circumstances, the Association s motion will be denied and Petitioner will be named prevailing party and be awarded her reasonable fees and costs despite that fact that she did not get the relief she sought in a final order. Attorney s Fees In Florida Patient s Compensation Fund v. Rowe, 472 So. 2d 1145, 1150 (Fla. 1985), the Supreme Court adopted the federal lodestar approach as the foundation for setting reasonable fee awards. This approach requires the trial court to determine a lodestar figure by multiplying the number of hours reasonably expended on the litigation by a reasonable hourly rate for the services of the prevailing party s attorney. Fashion Tile & Marble v. Alpha One Construction, 532 So. 2d 1306 (Fla. 2d DCA 1988). In undertaking this analysis, the reasonableness of the hourly rate and the number of hours reasonably expended must be separately considered. See Rowe, 472 So. 2d at In determining the reasonableness of attorney s fees, the criteria set forth in Rule 4-1.5, Rules Regulating the Florida Bar, Rules of Professional Conduct [then Disciplinary Rule 2-106(b) of the Florida Bar Code of Professional Responsibility] should be applied. Id. at The factors for determining a reasonable attorney s fee set forth in Rule are basically the same as the factors set forth in Rule 61B , Florida Administrative Code. 6

7 Hourly Rate Petitioner seeks compensation for the legal services of Eric Glazer, Esq. at the rate of $ per hour. After considering the above factors, the undersigned finds this hourly rate is excessive. According to the Florida Bar s website, Mr. Glazer was admitted to practice in Florida on September 24, 1992, 23 years at the time of his representation of Petition in this matter. A more reasonable hourly rate is $ per hour. Iglesias v. Aqua Vista Townhomes Condominium Association, Inc., Fee Case No , Final Order on Respondent s Motion for Attorney s Fees and Costs (June 12, 2014)(24 years); Hall v. Southcreek Homeowner s Association, Inc., Fee Case No (February 25, 2015)(21 years). Attorney Hours The expenditure of time outlined in the attorney s timesheet 5.2 hours is reasonable, therefore Petitioner will be awarded 5.2 hours at the rate of $ per hour for the time counsel expended on the case. This totals $1, in attorney s fees. Petitioner will also be awarded costs in the amount of $200.00, which represents the filing fee for a total award of $1, Accordingly, it is Ordered: 1. Within thirty (30) days of the date of this Final Order, the Association shall reimburse Petitioner s attorney s fees and costs in the amount of $1, The Association s motion for the award of fees and costs as prevailing party and its renewed motion for sanctions are DENIED. DONE AND ORDERED this 25 th day of January, 2016, at Tallahassee, Leon County, Florida. 7

8 Leah A. Simms, Arbitrator Department of Business and Professional Regulation, Arbitration Section 1940 North Monroe Street Tallahassee, Florida Phone: Fax.: 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. As provided by section , Florida Statutes, the prevailing party in this proceeding is entitled to have the other party pay reasonable costs and attorney s fees. Any such request must be filed in accordance with Rule 61B , F.A.C. Certificate of Service I HEREBY CERTIFY that, a true and correct copy of the foregoing Final Order on Petitioner s Motion for Attorney s Fees and Costs has been sent by U.S. Mail to the following persons on this 25 th day of January, 2016: Eric Glazer, Esq. Glazer & Associates, P.A Stirling Road,Suite 201 Fort Lauderdale, FL Fax: (954) Attorney for Petitioner Russell M. Robbins, Esq. Mirza Basulto & Robbins, LLP Palmetto Frontage Road, Suite 22 Miami Lakes, FL Fax: (305) Attorney for Respondent Leah A. Simms, Arbitrator 8