Tierra Holdings, Ltd. v. Mercantile Bank
2011 Fla. App. LEXIS 7152
| Fla. Dist. Ct. App. | 2011Background
- Mercantile and Tierra entered a contract in May 2004 where Tierra would purchase parcels from Mercantile, including a bank-use restriction on Parcel 2, with a prevailing party fee provision in the contract.
- The six-month restriction in the warranty deed followed but Tierra later sold Parcel 2 to Pilot Bank, which operated a bank on the property after expiration of the restriction.
- Mercantile sued Tierra for breach of contract and unjust enrichment; Tierra and Diamond served a Rule 1.442/768.79 proposal for settlement on December 1, 2006 offering to pay Mercantile $178,200 to resolve all claims, which Mercantile rejected.
- Trial proceeded; the jury awarded Mercantile $16,232 for breach of contract and the court, after a bench trial, awarded $725,000 for unjust enrichment; Mercantile later sought fees and costs under contract and 768.79, Tierra sought post-offer fees under the contract and under 768.79.
- The trial court held that 768.79 does not authorize modifying a contractual attorney’s fees provision and awarded Mercantile the full contractual and statutory costs/fees; Tierra was awarded partial recovery of its costs/fees, and the final judgment set off Mercantile’s award against Tierra’s
- On appeal, Tierra argued that a valid 768.79 proposal cuts off Mercantile’s entitlement to post-offer contractual attorney’s fees and costs; the First District affirmed, holding that 768.79 does not authorize such a modification
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does 768.79 modify contractual attorney's fees post-offer? | Tierra: offer cuts off post-offer contractual fees | Mercantile: statute does not modify contract rights | No, 768.79 cannot modify contractual fees |
| Is the contract's broad attorney's fees provision enforceable after offer? | Tierra: post-offer fees barred by 768.79 | Mercantile: contract fees recoverable as prevailing party | Contractual fees remain recoverable as provided |
| Is Danis distinguishable from this contractual-fee context? | Tierra: Danis supports post-offer fee cut-off | Mercantile: Danis applies only to statutory contexts | Danis distinguished; contract context not controlled by Danis |
| Does White v. Steak and Ale affect definition of 'judgment obtained' for fee purposes? | Tierra: White supports post-offer fee cut-off | Mercantile: White does not require post-offer cut-off | White does not compel post-offer cut-off in contract-fee context |
Key Cases Cited
- Sarkis v. Allstate Ins. Co., 863 So.2d 210 (Fla.2003) (strict construction of 768.79; penalties apply)
- Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So.2d 276 (Fla.2003) (strict construction of statutes in fee disputes)
- Major League Baseball v. Morsani, 790 So.2d 1071 (Fla.2001) (strict construction; penalties framework)
- Lashkajani v. Lashkajani, 911 So.2d 1154 (Fla.2005) (contractual fee provisions protect rather than enrich)
- Fixel Enterprises, Inc. v. Theis, 524 So.2d 1015 (Fla.1988) (contractual fees differ from statutory fees; offers impact post-offer fees)
- Goode v. Udhwani, 648 So.2d 247 (Fla.4th DCA 1994) (statutory-fee conflicts with general fee rules; choose 768.79 outcome)
- Danis Industrial Corp. v. Ground Improvement Techniques, Inc., 645 So.2d 420 (Fla.1994) (distinguished post-offer fees in statutory vs contractual contexts)
- White v. Steak and Ale of Florida, Inc., 816 So.2d 546 (Fla.2002) (definition of 'judgment obtained' under 768.79; not controlling for contract fees)