Pinnacle Three Corp. v. EVS Investments, Inc.
193 So. 3d 973
| Fla. Dist. Ct. App. | 2016Background
- Pinnacle Three and co-plaintiffs settled a multi-million dollar commercial suit against numerous defendants, including four appellees; the court approved the settlement and dismissed the case with prejudice while reserving jurisdiction "to enforce the terms of the Settlement Agreement."
- The settlement required various payments (cash and secured promissory notes) and contained a noncompetition covenant; Paragraph 7 provided that the prevailing party in any dispute "arising from or under the Settlement Agreement" shall recover reasonable attorney’s fees and costs.
- Eleven months post‑settlement the four appellees filed a motion to enforce, alleging breaches by Pinnacle and seeking to be excused from payment obligations or released from further payments.
- Appellees served extensive discovery; Pinnacle sought a protective order. A special magistrate and the trial court concluded the relief sought by appellees exceeded the settlement’s specific terms and the court’s retained jurisdiction.
- The trial court denied the motion to enforce without prejudice and ordered appellees to continue making payments; it then denied Pinnacle’s motion for attorneys’ fees incurred in resisting the motion, without prejudice to fees in any separate suit.
- Pinnacle appealed; the district court reversed the denial of fees, holding Pinnacle prevailed on the post‑settlement dispute and was entitled to fees under the clear, mandatory fee‑shifting clause in Paragraph 7.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Pinnacle is entitled to attorney’s fees for opposing the motion to enforce under Paragraph 7 | Paragraph 7 applies to disputes "arising from or under" the settlement; Pinnacle prevailed and thus is entitled to recover reasonable fees and costs | Fees not appropriate because appellees’ motion exceeded the settlement scope and relief sought was outside retained jurisdiction; trial court properly denied fees pending a new suit | Court held Paragraph 7 plainly entitles the prevailing party to fees; Pinnacle prevailed and is entitled to fees for this post‑settlement dispute |
| Whether the trial court retained jurisdiction to resolve the appellees’ requests | Pinnacle argued the court could award fees and resolve fee disputes as part of enforcement jurisdiction retained by the dismissal order | Appellees argued their claims went beyond enforceable settlement terms and required a separate action, so no fee award here | Court agreed the bulk of appellees’ requested relief exceeded retained jurisdiction, but concluded awarding fees to Pinnacle for defending the enforcement motion fell within the court’s retained enforcement jurisdiction |
| How to identify the “prevailing party” for fee shifting when enforcement motion is denied without prejudice | Pinnacle urged it prevailed because appellees obtained no relief and were told to file a separate action if desired | Appellees relied on cases where fee awards required balancing multiple claims or where neither side clearly prevailed | Court found Pinnacle plainly the prevailing party because the enforcement motion failed and appellees obtained no relief; fee clause is mandatory for the prevailing party |
Key Cases Cited
- Mihalyi v. LaSalle Bank, N.A., 162 So. 3d 113 (Fla. 4th DCA 2014) (standard for de novo review when fee entitlement depends on contract interpretation)
- Stevens v. Zakrewski, 826 So. 2d 520 (Fla. 4th DCA 2002) (same principle on review standard)
- Muñoz Hnos., S.A. v. Editorial Televisa, 121 So. 3d 100 (Fla. 3d DCA 2013) (settlement agreements are contracts governed by contract law)
- Paulucci v. Gen. Dynamics Corp., 842 So. 2d 797 (Fla. 2003) (court’s retained jurisdiction to enforce settlement is limited by settlement terms)
- Sun Microsystems of Cal., Inc. v. Eng’r & Mfg. Sys., C.A., 682 So. 2d 219 (Fla. 3d DCA 1996) (public policy favors enforcement of settlement agreements)
- Moritz v. Hoyt Enterprises, Inc., 604 So. 2d 807 (Fla. 1992) (prevailing party analysis where parties prevail on different issues)
- Nudel v. Flagstar Bank, 60 So. 3d 1163 (Fla. 4th DCA 2011) (defendant considered prevailing where plaintiff voluntarily dismissed)
- Sarhan v. H&H Inv’rs, Inc., 88 So. 3d 219 (Fla. 3d DCA 2011) (scope of enforcement limited to specific settlement obligations)
- Baldoria v. Security Realty Inv., Inc., 581 So. 2d 189 (Fla. 3d DCA 1991) (illustrative of fee issues when relief is mixed or limited)