DEER VALLEY REALTY, INC., Appellant, v. SB HOTEL ASSOCIATES LLC, a Delaware limited liability company, et al., Appellee.
Nos. 4D14-2051 and 4D15-830
DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA FOURTH DISTRICT
[April 27, 2016]
Raoul G. Cantero, David P. Draigh and Jesse L. Green of White & Case LLP, Miami, and Joseph E. Altschul of Joseph E. Altschul, LLC, Pembroke Pines, for appellant.
Bruce S. Rogow and Tara A. Campion of Bruce S. Rogow, P.A., Fort Lauderdale, and Herman J. Russomanno, Robert J. Borrello and Herman J. Russomanno, III of Russomanno & Borrello, P.A., Miami, for appellee.
MAY, J.
A failed real estate investment resulted in an action to recoup monetary losses. The plaintiff now appeals a judgment for the defendants and a consequent award of attorney‘s fees and costs. Concerning the underlying trial, the plaintiff argues the trial court erred in: (1) admitting “market crash” evidence and excluding the plaintiff‘s rebuttal evidence; (2) excluding evidence challenging the credibility of a defense witness; (3) entering a directed verdict for Trump Florida Management, LLC; and (4) denying the plaintiff‘s motion to amend the complaint to assert a punitive damages claim.1 The plaintiff also appeals the award of attorney‘s fees
The plaintiff‘s complaint was based on the “Offering Documents” that explained Donald Trump‘s role in the hotel project, which included a license to use his name and brand and provided for Trump Florida Management to act as the initial hotel manager. The Property Report stated in capital letters that “the condominium shall initially be known as the Trump International Hotel . . . pursuant to a license agreement with Donald J. Trump. If that license agreement is terminated, rights to the Trump name and servicemarks must cease. This may have a negative impact on the value of your unit.”
The Purchase Agreement and other documents had similar disclosures. The Purchase Agreement contained the following statement: “Buyer has not relied upon . . . any representations as to: . . . (f) any particular hotel affiliation or maintaining any existing hotel affiliation.”
SB Hotel Associates LLC (“SB Hotel“) obtained a temporary certificate of occupancy in October 2008. A general manager and nine other hotel executives, selected by Donald Trump, were hired for the hotel opening. When buyers entered into reservation and purchase agreements in 2005, the real estate market was at a historic high. By the time the certificate of occupancy was issued and closings were scheduled in May 2009, the market had collapsed.
On May 5, 2009, in an effort to ensure compliance with the “Trump Standard,” Trump Marks Fort Lauderdale LLC (“Trump Marks“), the licensor under the license agreement, issued a default notice to SB Hotel, identifying particular issues that Donald Trump believed SB Hotel needed to address. Trump Marks did not terminate either the license agreement or hotel management agreement, and did not attempt to remove the Trump name from the project.
On May 13, 2009, SB Hotel sent a letter to each buyer, which scheduled a walk through inspection and closing date of May 28, 2009. The letter advised buyers of the existence of the Trump Marks default notice. It also advised that “[g]iven the uncharted economic climate that we are adapting to, and the impact that the economy has had on both the real estate and hospitality industries, we do not believe that the hotel operation will open if purchasers have closed on fewer [than] fifty percent (50%) of the units.” It informed buyers that they would not be permitted to occupy their units
Of the 170 buyers, only one showed up to close. Not long after, the lender failed and was seized by the FDIC. The project went into foreclosure, and SB Hotel‘s interest was wiped out.
The plaintiff filed a third amended complaint, alleging counts for violation of the federal Interstate Land Sales Full Disclosure Act (“ILSA“), fraud, negligent misrepresentation, fraudulent concealment, and misleading advertising in violation of
The jury returned a verdict for the defendants on all counts. The defendants moved for attorney‘s fees and costs pursuant to
On appeal, the plaintiff argues the proposals for settlement do not comply with
The defendants respond that the proposals comply with both the rule and statute. Statements concerning attorney‘s fees and punitive damages are included in the proposal and no punitive damages claim was pending at the time the proposals were made. Amending the pleadings to add statutory claims for prospective attorney‘s fees did not impact the proposals.
We have de novo review of orders awarding “attorney‘s fees and costs pursuant to
Horowitch is instructive. In answering a certified question from the Eleventh Circuit Court of Appeals, our supreme court stated:
[E]ven if
section 768.79 applied in this case, Diamond Aircraft would not be entitled to attorney‘s fees under that section because Diamond Aircraft‘s offer of settlement did not strictly comply withrule 1.442 , as it did not state that the proposal included attorney‘s fees and attorney‘s fees are part of the legal claim.
Horowitch, 107 So. 3d at 377 (emphasis added).
Here, paragraph five of the proposals stated:
The claims to be resolved by acceptance of this proposal for settlement are all claims against Defendant that were raised in this action or could have been raised in this action by Plaintiff, and any claims against Plaintiff, that were raised in this action or could have been raised in this action by Defendant.
Paragraph seven stated: “This proposal for settlement is inclusive of all attorney‘s fees and costs incurred by Plaintiff or Defendant.”
While the proposals included attorney‘s fees, they neglected to include a statement that ”attorney‘s fees [were] part of the legal claim.” The proposals satisfied only half of
Next, the plaintiff argues the trial court erred in finding the defendants
“[E]ntitlement to recover fees and costs [is] generally . . . limited to those fees and costs directly and exclusively related to each claim . . . on which recovery is allowed . . . .” Black Diamond Props., Inc. v. Haines, 36 So. 3d 819, 822 (Fla. 5th DCA 2010). However, the defendants argue the attorney‘s fees under the
“[W]here the claims involve a common core of facts and are based on related legal theories, a full fee may be awarded unless it can be shown that the attorneys spent a separate and distinct amount of time on counts as to which no attorney‘s fees were sought.” Anglia Jacs & Co. v. Dubin, 830 So. 2d 169, 172 (Fla. 4th DCA 2002) (internal quotation marks omitted) (quoting Caplan v. 1616 E. Sunrise Motors, Inc., 522 So. 2d 920, 922 (Fla. 3d DCA 1988)).
“The party seeking fees has the burden to allocate them to the issues for which fees are awardable or to show that the issues were so intertwined that allocation is not feasible.” Waverly at Las Olas Condo. Ass‘n v. Waverly Las Olas, LLC, 88 So. 3d 386, 388 (Fla. 4th DCA 2012) (internal quotation marks omitted) (quoting Chodorow v. Moore, 947 So. 2d 577, 579 (Fla. 4th DCA 2007)).
Because the trial court did not determine whether the claims were intertwined, we remand the case for that determination and for calculation of the amount of attorney‘s fees based on that determination. We also direct the court to limit the fees from December 13, 2013, pursuant to its own order of December 17, 2014.
In conclusion, the proposals for settlement failed to strictly comply with
FORST, J., and SCHER, ROSEMARIE, Associate Judge, concur.
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Not final until disposition of timely filed motion for rehearing.