HFC COLLECTION CENTER, INC., Petitioner, v. STEPHANIE ALEXANDER, Respondent.
Case No. 5D15-1177
IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA FIFTH DISTRICT
Opinion filed April 22, 2016
NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED
Brett H. Burkett, and Thomas Lobello, of Rolfe & Lobello, P.A., Jacksonville, for Petitioner.
Taras S. Rudnitsky, of the Rudnitsky Law Firm, Longwood, Nicholas A. Shannin, of the Shannin Law Firm, P.A., Orlando, and James C. Hauser, of Attorney‘s Fees in Florida, P.L., Maitland, for Respondent.
EDWARDS, J.
ON MOTIONS FOR REHEARING
We grant in part and deny in part Respondent‘s motion for rehearing, and substitute the following opinion in place of our original opinion. We also vacate that portion of our March 7, 2016 order that denied rehearing. We deny Respondent‘s motions for certification and for rehearing en banc.
HFC Collection Center, Inc. petitions this court for a second tier writ of certiorari to quash a final order by the circuit court, sitting in its appellate capacity, affirming the county court‘s award of attorney‘s fees in favor of Stephanie Alexander. After ruling that HFC failed to prove that it was an assignee of a contract and thus had no authority to sue Alexander, the county court granted Alexander‘s motion for attorney‘s fees based on that same contract. HFC argued below that since the trial court‘s ruling meant that no contract existed between HFC and Alexander, there was no basis for awarding fees to her pursuant to
BACKGROUND FACTS
HFC sued Alexander to collect past due amounts she allegedly owed American Express pursuant to a credit card agreement. HFC claimed that it was the assignee of the American Express/Alexander agreement, and was therefore entitled to pursue American Express‘s collection rights against Alexander. HFC attached copies of the credit card agreement and the purported assignments of Alexander‘s account to its complaint. Based upon its claim that Alexander failed to make timely payments, HFC demanded judgment for the outstanding past due balance of $8,964.97, plus interest. The agreement contained a unilateral prevailing party attorney‘s fees provision in favor of American Express.
In her answer, Alexander agreed that she had entered into a written credit card agreement or contract with American Express, but denied that the copy attached to the complaint was valid because it did not bear her signature. Alexander additionally asserted several affirmative defenses, two of which are relevant. First, Alexander claimed that the charges in question were not authorized by her, that she had properly notified American Express of the
At her earliest opportunity, Alexander clearly notified HFC that she was seeking attorney‘s fees. Her answer included two different claims for attorney‘s fees and costs: (1) a claim pursuant to the terms of the contract and
Alexander moved for summary judgment based upon the aforementioned affirmative defenses. HFC responded to Alexander‘s motion for summary judgment by filing affidavits. The county court determined that HFC‘s affidavits were insufficient because the affiant lacked personal knowledge and would not be competent to testify as to the subject matter in the affidavits. The court additionally held that the subject matter of the affidavits would not be admissible evidence. Following a hearing, the county court granted Alexander‘s motion for summary judgment, finding that HFC lacked standing because it failed to offer any evidence to prove that it was the real party in interest by way of assignment. The county court noted that there was a clear break in the chain of assignments, thus there was no evidence of a valid assignment to HFC. Furthermore, the evidence did not establish that Alexander‘s account debt was ever assigned by American Express. HFC did not factually dispute either aspect of the flawed assignments. Thus, HFC was a stranger to the credit card agreement between American Express and Alexander, and there was no contractual relationship between HFC and Alexander. HFC did not appeal the summary judgment.
Alexander then moved for attorney‘s fees. HFC and Alexander agreed that the credit card agreement contained a term requiring Alexander, as the cardholder, to pay all reasonable costs and attorney‘s fees that may be incurred by American Express. Both parties agreed that
The circuit court, in its appellate capacity, affirmed the county court‘s ruling. The circuit court additionally held that HFC was estopped from challenging the award of attorney‘s fees by arguing that no contract existed between it and Alexander. HFC timely petitioned for second-tier certiorari review to this court.
STANDARD OF REVIEW
A district court of appeal may review by writ of certiorari “final orders of circuit courts acting in their review capacity.”
ABSENCE OF CONTRACT BETWEEN THE PARTIES
There is no dispute that there was a contract between American Express and Alexander; however, HFC was adjudicated to be a stranger to that contract. The county court‘s determination that HFC was not the assignee of the credit card agreement between American Express and Alexander means that there was never a contract between HFC and Alexander. In Bank of New York Mellon v. Mestre, 159 So. 3d 953 (Fla. 5th DCA 2015), the bank‘s attempt to foreclose on a mortgage was halted when the trial court determined that the signatures on the loan documents were forgeries. 159 So. 3d at 954. Under those circumstances, we held that no legal obligations were ever created between the parties. Accordingly, the Mestres could not recover attorney‘s fees on the basis of the loan documents. Id. at 956; see also Novastar Mortg., Inc. v. Strassburger, 855 So. 2d 130, 131 (Fla. 4th DCA 2003) (holding that mortgage could not serve as basis for award of attorney‘s fees to person who was not party to mortgage).
In Surgical Partners, LLC, v. Choi, 100 So. 3d 1267 (Fla. 4th DCA 2012), the Fourth District dealt with a situation where there was a signed employment agreement between the medical association and physician. The physician avoided the enforcement of the employment contract by successfully arguing that the agreement never became effective because of the failure of a condition precedent. 100 So. 3d at 1268. The trial court granted summary judgment in favor of the physician. Id. After the summary judgment was affirmed on appeal, the physician sought and was awarded attorney‘s fees under that same employment agreement. Id. at 1268-69. The Fourth District reversed, holding that since the contract never became legally effective, it could not be enforced by either party. Id. at 1269. “The doctor simply cannot avoid a liquidated damages provision by claiming the agreement never came into effect or was unenforceable, and at the same time be entitled to attorney‘s fees under the same agreement.” Id. at 1268. If there is no contract between the parties, which would entitle one to recover attorney‘s fees in the first place, “there is no basis to invoke the compelled mutuality provisions of”
ESTOPPEL BARS ALEXANDER, NOT HFC
As an alternative ground for affirming the county court‘s award of fees and costs to Alexander, the circuit court found that HFC, having based its suit on assignment of the credit card agreement, was estopped from denying the existence and enforceability of the agreement and its attorney‘s fees provision. In reaching this holding, we conclude that the circuit court applied the wrong law. “In judicial proceedings, a party simply is not estopped
It is Alexander, rather than HFC, that has successfully asserted irreconcilably inconsistent positions in this litigation. Alexander is indeed estopped from relying on the credit card agreement to recover attorney‘s fees after she successfully maintained that HFC was not a party to that agreement. Estoppel would have applied against HFC if it proved that there was a valid assignment, but lost the case because Alexander proved she had properly disputed unauthorized credit transactions, and HFC then claimed there was no contract in order to avoid liability for attorney‘s fees. Under these nonexistent, hypothetical facts, HFC certainly could not avoid payment of attorney‘s fees by disavowing the assigned agreement‘s terms and conditions. See Leitman, 439 So. 3d at 323 (acknowledging similar outcome on similarly hypothetical, nonexistent facts).
The lower court‘s reliance upon MCG Financial Services, L.L.C., v. Technogroup, Inc., 149 So. 3d 118 (Fla. 4th DCA 2014), is misplaced. In MCG, the plaintiff sued defendants on a written contract that mistakenly referred to a different company and did not identify or refer to the defendants. 149 So. 3d at 119. The contract was admitted into evidence without objection and all parties stipulated that the defendants were the real parties in interest despite not being named in the contract. Id. The defendants prevailed by proving that they paid all sums due to a collection agency. Id. at 120. After the plaintiff then obtained new counsel who asserted that defendants could not seek attorney‘s fees under that same contract because the defendants were not named in the contract. Id. at 120. The court of appeal found that plaintiff was estopped from asserting a position inconsistent with what it successfully asserted before, a position which was also inconsistent with the stipulated evidence at trial. Id. at 121. Here, Alexander succeeded in proving there was no contract between her and HFC. Therefore, Alexander, not HFC, is estopped from relying on the contract to obtain an attorney‘s fee award.
ALTERNATIVE BASIS FOR AWARDING ATTORNEY‘S FEES
In her answer, Alexander set forth a contingent claim for attorney‘s fees as follows: “To the extent [HFC] later claims there was no contract between the parties or their assignors, [Alexander] hereby puts [HFC] on notice that [Alexander] will seek attorney fees pursuant to [sections] 57.105(1)-57.105(4).” HFC did not respond in writing to Alexander‘s motion for attorney‘s fees. The first time HFC asserted that there was no contract between the parties was during the hearing on Alexander‘s motion for fees. As discussed
However, HFC taking the position that there was no contract has consequences. When granting Alexander‘s motion for summary judgment, the trial court found that there was “absolutely no showing -- much less admissible evidence” that the contract was assigned to one of HFC‘s predecessor assignees or that HFC owned Alexander‘s account. HFC conceded that it was not provided with a list of the accounts that were transferred to its predecessors.
Once it received and considered Alexander‘s motion for summary judgment, HFC knew or should have known that its claim was not supported by the material facts necessary to establish its claims. By offering no proof that Alexander‘s account was properly assigned, and by later taking the position that there was no contract between the parties in order to defeat Alexander‘s claim for attorney‘s fees, HFC essentially conceded that it had no factual basis for its suit against Alexander.
There is nothing in the record to suggest, one way or the other, whether Alexander strictly complied with the safe harbor provision of
It is clear that HFC had significantly more than 21 days to withdraw its baseless claim, as the trial court found that Alexander provided adequate notice in her answer of her intention to seek attorney‘s fees from HFC. Under these specific circumstances, we find that an award of attorney‘s fees, should the trial court choose to act on its own initiative, may be appropriate pursuant to
The Koch court noted its disagreement with Davidson v. Ramirez, 970 So. 2d 855 (Fla. 3d DCA 2007). 47 So. 3d at 324. In Davidson, the Third District Court of Appeal held that it was improper for the trial court, on its own initiative, to effectively adopt the prevailing party‘s untimely motion for fees because such action would circumvent the 21 day safe harbor provisions embodied in the statute. 970 So. 2d at 856. We agree with the Second District Court of Appeal‘s conclusions in Koch.
The Florida Supreme Court in Boca Burger, Inc. v. Forum, 912 So. 2d 561 (Fla. 2005), stated that an appellate court lacks
We thus remand to the circuit court with instructions to remand to the county court. The county court should consider whether Alexander complied with the safe harbor provision, and if appropriate, determine whether it will act on its own initiative to consider imposing attorney‘s fees against HFC if that court makes findings that the
PETITION GRANTED IN PART AND DENIED IN PART, REMANDED WITH INSTRUCTIONS.
PALMER and LAMBERT, JJ., concur.