St. Croix Lane Trust v. St. Croix at Pelican Marsh Condominium Association, Inc.
144 So. 3d 639
| Fla. Dist. Ct. App. | 2014Background
- Association obtained a foreclosure judgment and the unit sold at sheriff’s sale; St. Croix Lane Trust (Trust) bought the unit and received a certificate of title.
- The Trust bid $100; Association demanded payment of ~ $36–38k for pre-sale assessments, interest, late fees, utilities, costs, and attorney’s fees.
- Trust disputed the amount, claimed liability only for a prorated 2012 quarterly assessment, and tendered an $840 check accompanied by a letter stating the check was "tendered in full and final satisfaction" of all claims.
- Association’s counsel received and negotiated the $840 check but later filed (or threatened) enforcement of its lien for the larger amounts; Trust sued seeking declaratory relief and cancellation of the lien (plus damages for lost rental value).
- Circuit court granted summary judgment for the Association, holding Trust remained liable for pre-transfer amounts (less $840) and relying on Fla. Stat. § 718.116(3) to reject accord and satisfaction.
- On appeal, the Second District reversed, holding negotiation of the $840 check given in good-faith as full satisfaction (in the face of a bona fide dispute) resulted in accord and satisfaction; § 718.116(3) does not abrogate the general accord-and-satisfaction rule.
Issues
| Issue | Plaintiff's Argument (Trust) | Defendant's Argument (Association) | Held |
|---|---|---|---|
| Whether negotiation of a check tendered as full satisfaction of a disputed claim creates accord and satisfaction | Tendering the $840 check with conspicuous language and the claim being bona fide disputed produced an accord and satisfaction when Association negotiated the check | § 718.116(3) requires associations to apply payments to interest/fees/costs first and makes restrictive endorsements ineffective, so negotiation does not discharge amounts in excess of payment | Court held accord and satisfaction occurred; § 718.116(3) does not override § 673.3111 or the common-law accord-and-satisfaction rule in this context |
| Whether the Trust remained liable for pre-transfer assessments, fees, costs, interest, and attorney’s fees after the $840 payment | The $840 was tendered as full settlement, extinguishing Association’s prior claims and lien | The Trust is jointly and severally liable for pre-transfer obligations; acceptance of payment does not discharge other amounts | Court held pre-transfer obligations were discharged by accord and satisfaction; lien must be vacated (Trust entitled to partial summary judgment) |
| Whether the circuit court properly relied on Ocean Two Condominium Ass’n v. Kliger to uphold the Association | N/A (Trust distinguished Kliger because amounts were disputed) | Kliger supports statutory protection for associations applying payments despite restrictive endorsements | Court distinguished Kliger: there payments were undisputed; legislative history shows § 718.116(3) targets restrictive endorsements about allocation, not accord-and-satisfaction disputes |
| Remedy on remand | N/A | N/A | Court reversed summary judgment, directed entry of partial summary judgment discharging pre-title obligations and cancelling the lien; Count II (lost rental value) remains for adjudication |
Key Cases Cited
- Miller-Dunn Co. v. Green, 16 So. 2d 637 (Fla. 1944) (establishes that negotiation of a payment offered in full satisfaction can effect an accord and satisfaction)
- United Auto. Ins. Co. v. Palm Chiropractic Ctr., Inc., 51 So. 3d 506 (Fla. 4th DCA 2010) (accord-and-satisfaction principles applied where instrument and dispute supported discharge)
- Martinez v. S. Bayshore Tower, L.L.L.P., 979 So. 2d 1023 (Fla. 3d DCA 2008) (same: negotiation of conditional tender can create accord and satisfaction)
- Ocean Two Condominium Ass’n v. Kliger, 983 So. 2d 739 (Fla. 3d DCA 2008) (discussed as distinguishable; payments in Kliger were undisputed so statute’s allocation rule was dispositive)