Mid-Continent Casualty Co. v. R.W. Jones Construction, Inc.
227 So. 3d 785
| Fla. Dist. Ct. App. | 2017Background
- R.W. Jones sued the Muellers and obtained a $234,490.26 judgment; Carr Law represented R.W. Jones and sought substantial attorneys' fees; MCC (insurer) retained Meier Bonner to defend and later participated in claims.
- MCC, Carr Law, and R.W. Jones filed a combined proof of claim in Mueller’s bankruptcy for about $1.35M; MCC expressly reserved the right to dispute the amount of Carr Law’s fees and costs.
- The parties created a trust holding sale proceeds of the Muellers’ home; the trust required either unanimous written agreement or a court order to disburse funds.
- Bankruptcy mediation produced a Bankruptcy MSA that deemed the combined proof of claim ‘‘irrevocably allowed’’ but stated MCC’s joinder did not affect rights between R.W. Jones and MCC.
- Later state-court mediation produced a State Court MSA allocating $265,000 to R.W. Jones, $510,000 to Carr Law, and the remainder to MCC; MCC did not sign and moved to intervene to contest Carr Law’s fee amount and priority.
- Carr Law filed a notice of charging lien on the last day of an extended briefing period (at ~5:00 p.m.); MCC had only a few hours before the deadline to respond. The trial court approved the State Court MSA, found Carr Law’s lien perfected and MCC judicially estopped from contesting fees. MCC appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness/perfection of Carr Law’s charging lien | Carr Law: lien filed within extended briefing window and perfected; entitles first priority | MCC: late filing deprived MCC of meaningful opportunity to respond; lien not timely for due-process purposes | Reversed: filing at ~5pm on final day gave MCC inadequate time to be heard; trial court denied procedural due process; remand for hearing on lien and priority |
| Judicial estoppel based on Bankruptcy MSA | R.W. Jones/Carr Law: MCC joined Bankruptcy MSA and therefore cannot later dispute Carr Law’s claimed fee amounts | MCC: explicitly reserved right to dispute Carr Law’s fee amounts and the Trust/MSA preserved rights to a court-determined distribution | Reversed: Bankruptcy MSA and related communications did not show MCC waived or took an inconsistent position; MCC may challenge fee reasonableness |
| Whether Bankruptcy MSA determined distribution of proceeds | Appellees: MSA prevented objections to the combined claim amounts, implying acceptance of allocations | MCC: MSA merely avoided objections to allowance of the claim but preserved rights as to amounts and distribution | Court: Bankruptcy MSA did not conclusively determine distribution; Trust required agreement or court order; remand for fee hearing |
| Need for a fee hearing | Appellees: state-court settlement fixed Carr Law’s recovery | MCC: fee reasonableness unresolved and Meier Bonner’s and Carr Law’s fees must be adjudicated | Court: remanded for a hearing to determine reasonable fees for both firms and priority of distribution |
Key Cases Cited
- Silver v. Silver, 992 So. 2d 886 (Fla. 2d DCA 2008) (standard of review for interpretation of mediated settlement agreements)
- Kirsch v. Kirsch, 933 So. 2d 623 (Fla. 4th DCA 2006) (settlement interpretation authority)
- Sinclair, Louis, Siegel, Heath, Nussbaum & Zavertnik, P.A. v. Baucom, 428 So. 2d 1383 (Fla. 1983) (charging lien purpose and protection)
- Rose v. Marcus, 622 So. 2d 63 (Fla. 3d DCA 1993) (timely notice required to perfect charging lien)
- Keys Citizens for Responsible Gov’t, Inc. v. Fla. Keys Aqueduct Auth., 795 So. 2d 940 (Fla. 2001) (procedural due process requires fair notice and meaningful opportunity to be heard)
- Blumberg v. USAA Cas. Ins. Co., 790 So. 2d 1061 (Fla. 2001) (judicial estoppel prevents taking totally inconsistent positions)
- Grau v. Provident Life & Acc. Ins. Co., 899 So. 2d 396 (Fla. 4th DCA 2005) (discussion of judicial estoppel and unfair advantage)
- Mathews v. Eldridge, 424 U.S. 319 (U.S. 1976) (due-process balancing test)