234 F. Supp. 3d 1174
M.D. Fla.2017Background
- Bonita and Jeffrey Phillips owned 3060 Green Dolphin Lane, Naples, FL, as tenants by the entireties; Jeffrey had an Oregon money judgment domesticated in Collier County in favor of Epic Aviation for ~$322,603.30.
- In 2007 the Phillipses and the Chapter 7 Trustee entered a mediated Settlement Agreement: the Trustee would receive $825,000 from sale of the home; Trustee recorded an approval order and a lien; Debtors were to market the home (no deadline/price set).
- The home remained listed for years; in 2012 the Phillipses signed a $4.325M contract (Morrissy) and later attempted other sales; title company concerns about Epic Aviation’s recorded documents repeatedly impeded closings.
- On October 12, 2012 Epic Aviation recorded (a) a Notice of Appeal of an auction/order, (b) a Notice of Lis Pendens asserting its appeal might affect the property; Epic later recorded a second Notice of Appeal (Nov. 14, 2012).
- Bankruptcy and district courts dissolved the lis pendens, avoided Epic’s judicial lien as impairing exemptions, and ultimately the appeals were denied; the Phillipses filed this slander-of-title suit; the Property later sold for $4.9M on Nov. 2, 2015.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Epic’s recorded Notices of Appeal and Lis Pendens were false and actionable disparagement (slander of title) | The recordings (especially the lis pendens) falsely asserted an interest affecting the Property and clouded title, deterring buyers | Recordings were true/improper but privileged litigation filings or non-substantive (not false) | Notices of Appeal were not false (literally true); the Lis Pendens was knowingly false and actionable because it represented the appeal could affect the property when Epic had no attachable interest |
| Whether Epic knew or should have known recordings would induce others not to deal with Phillips (malice/knowledge) | Epic intentionally recorded documents to block sales and knew recording would cloud title and deter buyers | Actions were litigation-related steps to protect Epic’s appellate rights or Trustee-purchased interest; privilege applies | Court found Epic acted with actual malice re: the lis pendens (bad faith strategy to block sales), satisfying the scienter element |
| Whether the litigation/appellate privilege or other defenses bar the slander claim | Plaintiffs argued privilege does not apply where the filing asserted an interest that could not lawfully affect the Property | Epic invoked Florida’s litigation and appellate litigation privilege and argued waiver/election-of-remedies bars recovery | Litigation privilege did not protect Epic’s lis pendens because the filing lacked a sufficient nexus to property rights; waiver/election defenses rejected |
| Damages from wrongful lis pendens and recoverable fees | Plaintiffs sought direct and consequential damages plus attorneys’ fees | Epic disputed causation, amount, and entitlement to fees | No direct damages (property later increased in value). Consequential damages (expenses while lis pendens outstanding) awarded: $194,830.38; attorneys’ fees awarded: $47,147.50; total judgment $241,977.88 |
Key Cases Cited
- Lehman v. Goldin, 36 So.2d 259 (Fla. 1948) (early Florida recognition of slander/disparagement of title)
- Gates v. Utsey, 177 So.2d 486 (Fla. Dist. Ct. App. 1965) (elements and malice/presumption discussion in slander-of-title claims)
- Bothmann v. Harrington, 458 So.2d 1163 (Fla. Dist. Ct. App. 1984) (elemental test: falsehood published to third parties, inducement not to deal, and damages)
- Levin v. Middlebrooks, 639 So.2d 606 (Fla. 1994) (Florida litigation privilege—absolute immunity for acts occurring during proceedings that relate to the proceeding)
- Echevarria v. Cole, 950 So.2d 380 (Fla. 2007) (clarification and scope of Florida litigation privilege)
- FCD Dev., LLC v. S. Fla. Sports Comm’n, Inc., 37 So.3d 905 (Fla. Dist. Ct. App. 2010) (measure of damages for wrongful lis pendens: difference in fair market value plus consequential damages)