IN THE SUPREME COURT OF FLORIDA CASE NO. SC-08-1922 Lower Tribunal No.: 3D07-299 AVIOR TECHNOLOGIES, INC., et al Petitioners, vs. CESSNA AIRCRAFT COMPANY, Respondent. RESPONDENT S BRIEF ON JURISDICTION Carlos F. Gonzalez Counsel of Record Florida Bar No. 0494631 Brant C. Hadaway Florida Bar No. 0494690 DIAZ REUS & TARG, LLP 100 Southeast 2 nd Street, Suite 2600 Miami, Florida 33131 Telephone: (305) 375-9220 Facsimile: (305) 375-8050 Henry Knoblock Knoblock & Coxhead, P. A. 7901 Southwest 67 th Avenue Suite 203 Miami, Florida 33143 Telephone: 305-669-9655 Facsimile: 305-669-6169 Trial Counsel for Respondent
TABLE OF CONTENTS INTRODUCTION... 1 STATEMENT OF THE CASE AND FACTS... 1 SUMMARY OF ARGUMENT... 3 ARGUMENT... 4 A. There Is No Conflict With Nash v. Wells Fargo... 4 B. There Is No Conflict With Brown v. Colonial Penn... 5 C. There Is No Conflict With Parsons v. Motor Homes of America... 6 D. There Is No Conflict With Moransais v. Heathman and Mercury Motors v. Smith... 8 E. There Is No Conflict With Russell v. Sherwin-Williams... 9 CONCLUSION... 10 CERTIFICATE OF SERVICE... 12 i
TABLE OF AUTHORITIES CASES BMC Indus., Inc. v. Barth Indus., Inc., 160 F.3d 1322 (11th Cir. 1998)... 7 Brown v. Colonial Penn Ins. Co., 666 So. 2d 226 (Fla. 2d DCA 1995)... 3, 5, 6 Cessna Aircraft Co. v. Avior Technologies, Inc., 990 So. 2d 532 (Fla. 3d DCA 2008)... passim Eller & Co., Inc. v. Galapagos Line, S.A., 493 So. 2d 1061 (Fla. 3d DCA 1986)... 8 Frank Griffin Volkswagen, Inc. v. Smith, 610 So. 2d 597 (Fla. 1st DCA 1992), reh g denied, (January 22, 1993)... 6, 7 Jenkins v. State, 385 So. 2d 1356 (Fla. 1980)... 4 Mercury Motors Express, Inc. v. Smith, 393 So. 2d 545 (Fla. 1981)... 4, 9 Metro. Dade Cty. v. Worsham Bros. Co., Inc., 563 So. 2d 1107 (Fla. 3d DCA 1990)... 8 Moransais v. Heathman, 744 So. 2d 973 (Fla. 1999)... 4, 8, 9 Nash v. Wells Fargo Guard Svcs., Inc., 678 So. 2d 1262 (Fla. 1996)... 3, 4, 5 Orange Motors of Coral Gables v. Dade Cty., 258 So. 2d 319 (Fla. 3d DCA 1972)... 7 Parsons v. Motor Homes of America, Inc., 465 So. 2d 1285 (Fla. 1st DCA 1985)... 3, 6, 7, 8 ii
Russell v. Sherwin-Williams Co., 767 So. 2d 592 (Fla. 4th DCA 2000)... 4, 10 Van v. Hobbs, 197 So. 2d 43 (Fla. 2d DCA 1967)... 6 Vesta Constr. and Design, LLC v. Lotspeich and Assoc., Inc., 974 So. 2d 1176 (Fla. 5th DCA 2008)... 10 STATUTES 672.102, Fla. Stat. (2007)... 7 672.719, Fla. Stat. (2007)... 7 OTHER AUTHORITIES Restatement (Second) of Torts 552... 9, 10 RULES Fla. R. App. P. 9.030(a)(2)(A)... 1, 4 CONSTITUTIONAL PROVISIONS Fla. Const. Art. 5, 3(b)(3)... 1, 4 iii
INTRODUCTION The issue before this Court is whether the Third District Court of Appeal s opinion in Cessna Aircraft Co. v. Avior Technologies, Inc., 990 So. 2d 532 (Fla. 3d DCA 2008) expressly and directly conflicts with any decision of this Court, or of a different district court of appeal, such that this Court may exercise discretionary jurisdiction to review the Third District s opinion. See Fla. Const. Art. 5, 3(b)(3); Fla. R. App. P. 9.030(a)(2)(A). As the analysis below shows, the Third District s opinion does not expressly and directly conflict with any opinion of this Court, nor with any opinion of the other district courts of appeal. Accordingly, this Court should deny review. STATEMENT OF THE CASE AND FACTS Petitioner Avior owned a 1978 Cessna Citation II aircraft (the Aircraft ). Cessna Aircraft Company v. Avior Technologies, Inc., 990 So. 2d 532, 534 (Fla. 3nd DCA 2008). Petitioner Avtech was a wholly-owned subsidiary of Avior. Id. When the Aircraft suffered damage, it was flown to Cessna s service center for repair. Id. Petitioner Avtech signed the service order, which contained a provision limiting Cessna s obligation under any applicable warranty to repair or replacement of defective parts and/or workmanship. Id. at 534-35. The service order also contained a provision that Avtech had full authority to bind the owner 1
or operator of the Cessna Citation Aircraft described herein and authorizes the services described herein to be performed. Id. at 535. After completing repairs, Cessna noted pressurization problems and brought them to Petitioners attention. Id. While unsuccessfully trying to repair the pressurization problem on its own, Avtech discovered a fuel leak. Id. The Aircraft was flown back to Cessna s facility and another service order, containing the same printed terms as the initial service order, was signed by an Avtech employee. Id. The Aircraft was returned to service in January, 2000. Id. However, in April, 2000 it was found that the wings were leaking fuel into the belly of the aircraft. Id. Cessna concluded that the Aircraft must have suffered a hard landing at some point. Id. When asked if it could guarantee repair of the fuel leak, Cessna stated that it could only do so if the wings were replaced. Id. Avior s insurer refused to pay for the expense. Id. Because the mortgage-holders on the Aircraft subsequently brought lien foreclosure actions against Avior, Avior and Avtech brought third-party claims against Cessna and the insurers. Id. at 535-36. The claims against Cessna were for breach of contract, negligence, professional negligence, and negligently supplying false information for the guidance of others. Id. at 536. Petitioners represented in their Complaint and throughout the trial proceedings that Avior and Avtech were interchangeable entities, or that Avtech was the agent of Avior. Id. at 535 n. 2, 2
536-37. For its part, Cessna consistently maintained that Petitioners tort claims were barred by the economic loss rule. Id. at 537. Regarding the contract claims, Cessna consistently argued either Avtech or Avior, but not both, could bring a contract claim, and that the claim would be circumscribed by both the service order limitation on damages and the economic loss rule. Id. Although the undisputed evidence demonstrated that Petitioners never turned a profit, Petitioners obtained a jury award in the amount of $5,414,619. Id. at 536 n. 4. The Third District reversed, in part, holding that: (1) Avior was bound by the limitation of damages provision in the service contract; (2) the economic loss rule barred Petitioners tort claims; (3) Petitioners failed to establish an exception to the economic loss rule for their professional negligence claims; and (4) damages under the service contract were limited by the limitation of damages provision. Id. at 536-39. SUMMARY OF ARGUMENT Petitioners have failed to identify a single aspect of the Third District s opinion that expressly and directly conflicts with a decision of this Court or of the five district courts of appeal. Specifically, Petitioners rely on five cases to establish conflict: Nash v. Wells Fargo Guard Svcs., Inc., 678 So. 2d 1262 (Fla. 1996); Brown v. Colonial Penn. Ins. Co., 666 So. 2d 226 (Fla. 2d DCA 1995); Parsons v. Motor Homes of America, Inc., 465 So. 2d 1285 (Fla. 1st DCA 1985); 3
Moransais v. Heathman, 744 So. 2d 973 (Fla. 1999); Mercury Motors Express, Inc. v. Smith, 393 So. 2d 545 (Fla. 1981); and Russell v. Sherwin-Williams Co., 767 So. 2d 592 (Fla. 4th DCA 2000). However, Petitioners either misstate the holdings of the cited cases or ignore their clearly distinguishable facts. Because Petitioners arguments are without merit, this Court should deny review. ARGUMENT This Court may accept jurisdiction upon finding that the ruling of the district court below expressly and directly conflicts with a precedent of this Court or with a ruling of another district court of this state. See Art. 5, 3(b)(3), Fla. Const; Fla. R. App. P. 9.030(a)(2)(A). Critically, the conflict must be evident from the four corners of the majority opinion of the lower court on the same question of law. See Jenkins v. State, 385 So. 2d 1356, 1359 (Fla. 1980). Because no such conflict exists in this case, the Petition should be denied. A. There Is No Conflict With Nash v. Wells Fargo Petitioners fail to establish that the Third District s opinion conflicts with this Court s decision in Nash v. Wells Fargo Guard Svcs., Inc., 678 So. 2d 1262 (Fla. 1996). Specifically, this Court held in Nash that in order to include a nonparty on the verdict form for the purposes of apportioning noneconomic damages, the defendant must plead as an affirmative defense the negligence of the nonparty, specifically identify the nonparty, and meet the burden of presenting the 4
nonparty s contributory fault at trial. Id. Nowhere in that opinion did this Court state, as Petitioners now contend, that a party may not during the course of litigation, occupy inconsistent and contradictory positions. Pet. Brf. at 6. positions: In any event, the Third District did not find that Cessna took inconsistent Cessna s argument was that only one entity or the other, not both, could make a claim, and that the claim would be circumscribed by both the service order limitation on damages and the economic loss rule applicable to any alleged tort. Cessna argued for the dismissal of all remaining claims and counts against it by both claimants, but acknowledged that one of the two, Avior or Avtech, would have a contract claim. Because a maintenance representative of Avtech signed the purchase orders, Cessna argued that Avtech should be that single claimant. Cessna, 990 So. 2d at 537. Based on these findings, the Third District concluded that Cessna was not estopped from claiming that Avior was bound by Cessna s contract with Avtech on appeal. Id. This ruling does not conflict with Nash. B. There Is No Conflict With Brown v. Colonial Penn Petitioners also fail to establish that the Third District s opinion below conflicts with the Second District s decision in Brown v. Colonial Penn. Ins. Co., 666 So. 2d 226 (Fla. 2nd DCA 1995). Again, Petitioners mischaracterize an appellate district s holding to create conflict. Brown involved a plaintiff who made a factual assertion in her initial complaint but deleted that assertion from her amended complaint. Id. at 227. In 5
refusing to make a factual finding based solely on the deleted assertion, the Second District stated that [a] party is not bound by an admission made in a preliminary pleading which is successfully attacked by the opponent.... Id. (emphasis added). The Second District did not hold, as Petitioners state, that [a] party is not bound by allegations which are subsequently and successfully attacked by the opposing party. Pet. Brf. at 8. Petitioners interpretation of the quoted statement is untenable, especially in light of the Second District s reliance on Van v. Hobbs, 197 So. 2d 43 (Fla. 2d DCA 1967), in which the Second District confirmed that parties are bound by admissions in the pleadings upon which issue is finally joined.... Id. at 45. In other words, Petitioners were bound by the pleadings on which they proceeded to trial. Furthermore, Brown is factually distinguishable from this case. While Brown involved an assertion eventually deleted from a party s amended pleading, Petitioners in this case proceeded to trial relying on allegations that they now repudiate. The Third District appropriately accepted these allegations as facts without the necessity of further proof. Cessna, 990 So. 2d at 537. C. There Is No Conflict With Parsons v. Motor Homes of America Petitioners argue that the Third District s opinion conflicts with Parsons v. Motor Homes of America, Inc., 465 So. 2d 1285 (Fla. 1st DCA 1985) and Frank Griffin Volkswagen, Inc. v. Smith, 610 So. 2d 597 (Fla. 1st DCA 1992), reh g 6
denied, (January 22, 1993), both of which addressed a buyer s remedies under Chapter 2 of the Uniform Commercial Code (the UCC ) where a seller s limited warranty allegedly fails of its essential purpose. See Parsons, 465 So. 2d at 1292; Smith, 610 So. 2d at 601-602. Petitioners argument is misleading because, as the Third District noted, Petitioners failed to plead their argument that the limitation of remedy provision failed of its essential purpose, and they failed to move for a continuance or to exclude Cessna s reliance on the contract when Cessna raised the limitation provision in its defense. Cessna, 990 So. 2d at 539. 1 In any event, Parsons, Smith, and Orange Motors of Coral Gables v. Dade Cty., 258 So. 2d 319 (Fla. 3d DCA 1972) are inapt because UCC Chapter 2 only applies to sales of goods. See 672.102, Fla. Stat. (2007). Accordingly, the buyer s remedies where a warranty has failed of its essential purpose, id. at 672.719, only applies to sales of goods. Cessna s service orders are, by contrast, purely contracts for services, and are therefore governed by common law rather than the UCC. See BMC Indus., Inc. v. Barth Indus., Inc., 160 F.3d 1322, 1329-30 (11th Cir. 1998) (analyzing applicability of the UCC to hybrid contracts). It is well settled in Florida s common law that clauses in contracts limiting liability are 1 The district court also distinguished Parsons on grounds that it involved a family s purchase of a motor home with a service contract and additional federal trade commission remedies, whereas this case involved a transaction between sophisticated commercial parties, [and] a straightforward limitations provision.... Cessna, 990 So. 2d at 539. 7
valid and enforceable provided the intention to limit liability is made clear in the contract. Eller & Co., Inc. v. Galapagos Line, S.A., 493 So. 2d 1061, 1062 (Fla. 3d DCA 1986). See also Cessna, 990 So. 2d at 536 (citing Metro. Dade Cty. v. Worsham Bros. Co., Inc., 563 So. 2d 1107, 1108 (Fla. 3d DCA 1990)). Accordingly, neither Parsons nor Frank Griffin Volkswagen conflicts with this case. D. There Is No Conflict With Moransais v. Heathman and Mercury Motors v. Smith Petitioners argue that the Third District disregarded the professional negligence exception to the economic loss rule as set forth in Moransais v. Heathman, 744 So. 2d 973 (Fla. 1999). To the contrary, the Third District specifically noted that the economic loss rule does not bar relief in tort against individual professionals who were not parties to the underlying contract. Cessna, 990 So. 2d at 538 (citing Moransais, 744 So. 2d at 983). The Third District s point that no individual professionals were named as defendants, id., was one of several observations that led the court to conclude that Petitioners pleadings, and their evidence at trial, failed to support a claim for professional negligence. Id. Significantly, because Cessna is not the sort of business against which a professional negligence action would be normally brought, Petitioners failure to identify any engineering discipline, any individual engineer, or any applicable engineering standard or practice, was fatal. Id. Thus, as framed by the Third 8
District, the issue was not whether the economic loss rule barred Petitioners claim for professional negligence, but whether Petitioners had adequately pled and proved their claim. This can hardly be said to contradict Moransais. Petitioners further argue, without any colorable basis, that the Third District s opinion conflicts with Mercury Motors Express, Inc. v. Smith, 393 So. 2d 545 (Fla. 1981). As this Court expressly noted, [t]he determinative issue in Mercury Motors was under what circumstances may an employer under the doctrine of respondeat superior be held vicariously liable for punitive damages as the result of the willful and wanton misconduct of his employees committed while acting in the scope of their employment. Id. at 547. The issue of punitive damages never arose in this case, and therefore was not addressed by the Third District. It logically follows that the opinion below does not and cannot conflict with Mercury Motors. E. There Is No Conflict With Russell v. Sherwin-Williams Petitioners further mischaracterize the opinion of the Third District as holding that a claim for negligent provision of information for the benefit of others (pursuant to Restatement (Second) of Torts 552) is categorically barred by the economic loss rule. Pet. Brf. at 10. What the Third District plainly held is that a party cannot circumvent the allocation of loss contained within a contract by bringing a claim in tort. Cessna, 990 So. 2d at 537. This case involved parties that 9
were in contractual privity. By contrast, the Fourth District in Russell v. Sherwin- Williams Co., 767 So. 2d 592 (Fla. 4th DCA 2000) clearly relied on the fact that the defendant was not in privity with the plaintiff. Id. at 593-595. Russell comports with the general rule that a cause of action under Restatement section 552 is only available where a party has relied on the advice of third parties, not where the complainant is directly in privity with the person rendering such advice. See Vesta Constr. and Design, LLC v. Lotspeich and Assoc., Inc., 974 So. 2d 1176 (Fla. 5th DCA 2008) (noting that [s]ection 552 was adopted in Florida to define the limited circumstances under which those not in privity with a purveyor of information could nonetheless bring suit to recover its economic losses for information negligently supplied ) (emphasis added). Because this case involved parties that were in contractual privity, there is no conflict between Russell and the Third District s determination that Petitioners failed to state a claim under Restatement section 552. CONCLUSION Based on the foregoing points and authorities, this Court should decline to exercise its discretionary jurisdiction. Carlos F. Gonzalez Counsel of Record Florida Bar No. 0494631 Email: cgonzalez@diazreus.com Brant C. Hadaway 10
Florida Bar No. 0494690 Email: bhadaway@diazreus.com DIAZ REUS & TARG, LLP 100 Southeast 2 nd Street, Suite 2600 Miami, Florida 33131 Telephone: (305) 375-9220 Facsimile: (305) 375-8050 Henry Knoblock Knoblock & Coxhead, P. A. 7901 Southwest 67 th Avenue Suite 203 Miami, Florida 33143 Telephone: 305-669-9655 Facsimile: 305-669-6169 Counsel for Respondent 11
CERTIFICATE OF SERVICE I CERTIFY that a copy of the foregoing was served by Facsimile and U.S. Mail this day of November, 2008, to: Andrew Gold, Esquire, and Dianne O. Fischer, Esquire, Kluger Peretz Kaplan & Berlin, P.L., 201 S. Biscayne Boulevard, 17 th Floor, Miami, Florida 33131-3428 and to Joel S. Perwin, Esquire, Joel S. Perwin, P.A., 169 East Flagler Street, Suite 1422, Miami, Florida 33131-1212. Carlos F. Gonzalez 9.210. CERTIFICATE OF COMPLIANCE I CERTIFY that this brief complies with the provisions of Fla.R.App.P. Carlos F. Gonzalez 12