MADISON AT SOHO II CONDOMINIUM ASSOCIATION, INC. v. DEVO ACQUISITION ENTERPRISES, LLC
Case No. 2D15-2067
IN THE DISTRICT COURT OF APPEAL OF FLORIDA SECOND DISTRICT
Opinion filed August 24, 2016.
BADALAMENTI, Judge.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED
Jacob A. Brainard and Scott Davis of Business Law Group, P.A., Tampa, for Appellant.
Shazia N. Sparkman of Sparkman & Sparkman, P.A., Tampa, for Appellee.
I. INTRODUCTION
Madison at SoHo II Condominium Association, Inc. (the Association) sued Devo Acquisition Enterprises, LLC (Devo), for foreclosure or a money judgment, alleging that Devo was liable for $40,645.70 in unpaid condominium fees and assessments. Devo argued that the Association‘s acceptance of Devo‘s $2412 payment constituted an accord and satisfaction of that debt, pursuant to section
During the pendency of this appeal and in the legislative session immediately following our St Croix Lane Trust decision, the legislature passed an amendment to section
II. FACTUAL AND PROCEDURAL BACKGROUND
A. The Initial Dispute
The Association is a not-for-profit corporation designed to manage an eponymous condominium development in Hillsborough County. Devo acquired title to unit 939B of the Association‘s condominium development. The previous owners of the unit had been delinquent in paying assessments and related charges to the Association. In acquiring title to the unit, Devo became jointly and severally liable for the delinquent assessments and charges under the terms of the Declaration. The Association attempted to obtain payment from Devo. In turn, Devo disputed the amount it owed.
On January 28, 2014, Devo sent the Association a proposed offer for accord and satisfaction of the contested debt, along with a corresponding check for $2412. The Association does not contest that Devo intended its check to be an accord and satisfaction of the delinquent amount owed. On February 17, 2014, the Association‘s counsel informed Devo by email that Devo‘s offer was rejected. On July 1, 2014, the Association filed a lien foreclosure complaint against Devo for failing to pay certain assessments due from November 2008 through April 2014. The Association alleged that Devo owed
B. The Court‘s Intervening Decision in St. Croix Lane Trust
On August 8, 2014, approximately one month after the Association commenced its foreclosure action, this court issued St. Croix Lane Trust. In St. Croix Lane Trust, a condominium association sought to foreclose a lien against a condominium unit owned by a trust because of past-due assessments. 144 So. 3d at 640. The trust argued that accord and satisfaction, pursuant to section
Any payment received by an association must be applied first to any interest accrued by the association, then to any administrative late fee, then to any costs and reasonable attorney‘s fees incurred in collection, and then to the delinquent assessment. The foregoing is applicable notwithstanding any restrictive endorsement, designation, or instruction placed on or accompanying a payment.
(Emphasis added.) Thus, the trial court in St. Croix Lane Trust held that when a condominium association negotiates a check, the order of priority set out in section
On appeal, this court disagreed, holding that nothing in section
C. The Trial Court Grants Summary Judgment in Favor of Devo
On October 9, 2014, after discovering that the Association had deposited Devo‘s $2412 check, Devo filed an amended motion to dismiss, alleging in part that the negotiation of Devo‘s check operated as accord and satisfaction, and citing this court‘s decision in St. Croix Lane Trust for support. On November 12, 2014, Devo filed an answer and affirmative defenses. Devo‘s first affirmative defense was accord and satisfaction, pursuant to section
13.10 Application of Payments. Any payments received by the Association from a delinquent Unit Owner shall be applied first to any interest accrued on the delinquent installment(s) as aforesaid, then to any administrative late fees, then to any costs and reasonable attorneys’ fees incurred in collection and then to the delinquent and any accelerated Assessments. The foregoing shall be applicable notwithstanding any restrictive endorsement, designation or instruction placed on or accompanying a payment.
(Emphasis added.) The Association argued that this contractual language precluded accord and satisfaction, even though St. Croix Lane Trust held that the same language in section
D. The Clarifying Amendment to Section 718.116(3)
On June 2, 2015, the clarifying amendment, which the Association had pointed out to the trial court was pending in the legislature, was approved by the governor after passing both houses of the legislature. See ch. 2015-97, § 9, at 18-19, Laws of Fla. The approval occurred almost one month after Devo filed its notice of appeal, two months after the trial court had granted summary judgment, and ten months after this court decided St. Croix Lane Trust. As amended, the pertinent part of section
(3) Any payment received by an association must be applied first to any interest accrued by the association, then to any administrative late fee, then to any costs and reasonable attorney fees incurred in collection, and then to the delinquent assessment. The foregoing is applicable notwithstanding s. 673.3111, any purported accord and satisfaction, or any restrictive endorsement, designation, or instruction placed on or accompanying a payment. The preceding sentence is intended to clarify existing law. A late fee is not subject to chapter 687 or s. 718.303(4).
(Emphasis added.) With the passage of this amendment during the pendency of this appeal, the Association‘s position on appeal shifted from its primary position in the trial court. Whereas the Association once argued that the statutory language should not trump the language of its Declaration, it now argues that the recent
III. ANALYSIS
A. Utilization of a Legislature‘s Amendment of a Statute Enacted Shortly After a Controversy Arises Regarding the Interpretation of the Statute
Florida courts have “the right and the duty” to consider the legislature‘s recently enacted statute clarifying its intent in a prior version of a statute, which was passed soon after a controversy arose in the interpretation of that original, pre-amended statute. Ivey v. Chicago Ins. Co., 410 So. 2d 494, 497 (Fla. 1982) (quoting Gay v. Canada Dry Bottling Co. of Fla., 59 So. 2d 788, 790 (Fla. 1952)); Finley v. Scott, 707 So. 2d 1112, 1116-17 (Fla. 1998) (first citing Parole Comm‘n v. Cooper, 701 So. 2d 543 (Fla. 1997); then citing Lowry v. Parole & Prob. Comm‘n, 473 So. 2d 1248, 1250 (Fla. 1985)). “When the legislature amends a statute shortly after controversy has arisen over its interpretation, the amendment can be considered an interpretation of the original law, not a substantive change.” Essex Ins. Co. v. Integrated Drainage Sols., Inc., 124 So. 3d 947, 952 (Fla. 2d DCA 2013) (citing Metropolitan Dade County v. Chase Fed. Hous. Corp., 737 So. 2d 494, 503 (Fla. 1999)); see also Lowry, 473 So. 2d at 1250.
At first blush, it may appear that a court‘s consideration of a legislature‘s clarification of its intent with regard to the passage of an earlier statute is akin to retroactively applying an amended statute to pending litigation, which has the potential to create constitutional concerns. See Fla. Ins. Guar. Ass‘n v. Devon Neighborhood Ass‘n, 67 So. 3d 187, 195 (Fla. 2011) (explaining that there is a presumption against the retroactive application of substantive statutory amendments). This is not the situation here. The legislature‘s clarification of a statute is a tool of statutory construction that can be used to guide the interpretation of the pre-amended version of the statute. See
Leftwich v. Fla. Dep‘t of Corr., 148 So. 3d 79, 83 (Fla. 2014) (explaining that “if the Legislature amends a statute shortly after a controversy arises with respect to the interpretation of the statute, then the amendment may be considered to be a legislative interpretation of the original statute rather than a substantive change to the statute” (citing Lowry, 473 So. 2d at 1250)); Essex Ins. Co., 124 So. 3d at 952.
Thus, the legislature‘s clarification of the prior version of a statute after a recent controversy, such as a court‘s interpretation of the statute in contravention of the legislature‘s intent, is permissible. See Finley, 707 So. 2d at 1116 (first citing Cooper, 701 So. 2d at 544; then citing Lowry, 473 So. 2d at 1250)). This distinction is emphasized by the fact that, when the Florida Supreme Court has had occasion to simultaneously consider retroactivity and the recent controversy rule, it has treated the recent controversy rule as an inquiry that is distinct from retroactive application of an amended statute. See Leftwich, 148 So. 3d at 83-84 (treating the recent controversy rule as distinct from retroactive application of a criminal statute under the Ex Post Facto Clause); Metropolitan Dade County, 737 So. 2d at 502-03 (treating the application of controversy rule as distinct from the retroactive application of an amended statute). The Association asks us to revisit our prior construction of the pre-amended section
mention of its vested rights as they relate to the second prong of the retroactivity test is therefore inapposite.
B. The Application of Stare Decisis to the Recent Controversy Rule
Now that we have established that statutory construction, not retroactive application, is the task before us, we must explain how stare decisis interacts with the recent controversy rule. Devo argues that because St. Croix Lane Trust was good law at the time of the final judgment in this case, the trial court made the correct decision. Devo suggests that it would be unfair to reverse the trial court simply for applying binding precedent.
“[C]oncerns about maintaining settled law are strong when the question is one of statutory interpretation.” Leegin Creative Leather Prods., Inc. v. PSKS, Inc., 551 U.S. 877, 899 (2007) (citing Hohn v. United States, 524 U.S. 236, 251 (1998)). “When a court has interpreted a statute . . . and the Legislature does nothing to suggest that the interpretation does not effectuate legislative intent, there is ordinarily no good reason to alter the interpretation.” Clark v. State, 823 So. 2d 809, 811 (Fla. 1st DCA 2002) (emphasis added) (first citing State v. Hall, 641 So. 2d 403, 405 (Fla. 1994); then citing B & L Servs. v. Coach USA, 791 So. 2d 1138, 1142 (Fla. 1st DCA 2001)). But in the case before us, the legislature did not do “nothing.” It instead passed legislation effectuating its intent shortly after our decision in St. Croix Lane Trust. And, to the Association‘s credit, it brought to the trial court‘s attention that there was legislation in the works which would amend section
That is, upon this court‘s decision in St. Croix Lane Trust, the bill amending section
upon passage, received final gubernatorial approval. See Bill History, CS/CS/HB 0791 (2015), https://www.flsenate.gov/Session/Bill/2015/791/?Tab=BillHistory (last visited June 23, 2016). The plain language of the amended section
It is clear to us that the legislature amended section
the legislature‘s recent clarification of its intent. After all, “[a] court‘s purpose in construing a statute is to give effect to legislative intent, which is the polestar that guides the court in statutory construction.” Larimore v. State, 2 So. 3d 101, 106 (Fla. 2008) (citing Bautista v. State, 863 So. 2d 1180, 1185 (Fla. 2003)).
C. A Reexamination of St. Croix Lane Trust
Having distinguished retroactive application from the recent controversy rule and having explained why the recent legislative clarification to section
The opinion in St. Croix Lane Trust sought to determine whether the language in section
“To discern legislative intent, a court must look first and foremost at the actual language used in the statute.” Larimore, 2 So. 3d at 106 (emphasis added) (citing Bautista, 863 So. 2d at 1185). As previously noted, the version of section
“includes a condition . . . or any other language restricting further negotiation.” Restrictive Indorsement, Black‘s Law Dictionary 893 (10th ed. 2014).2 A proper offer of accord and satisfaction contains such a condition in the form of a “conspicuous statement” that an offer “was tendered as full satisfaction of the claim.” §
Courts in Florida and elsewhere have plainly characterized statements that an offer was tendered in full satisfaction of a disputed claim as restrictive endorsements. See, e.g., E & S Realty, Inc. v. Am. Equity Int‘l Corp., 478 So. 2d 1160, 1160 (Fla. 3d DCA 1985); Jobear, Inc. v. Dewind Mach. Co., 402 So. 2d 1357, 1358 (Fla. 4th DCA 1981); Yelen v. Cindy‘s, Inc., 386 So. 2d 1234, 1235 (Fla. 3d DCA 1980); see also Rhone v. State Auto. Mut. Ins. Co., 858 F.2d 1507, 1511 (11th Cir. 1988); Anderson v. Rosebrook, 737 P.2d 417, 419 (Colo. 1987); Didriksen v. Sewerage & Water Bd., 527 So. 2d 319, 321 (La. Ct. App. 1988); Hixson v. Cox, 633 S.W.2d 330, 331 (Tex. App. 1982). Our interpretation of “restrictive endorsement,” guided by the legislature‘s recent clarifying amendment, leaves only one possible outcome. The legislature abrogated our interpretation of section
D. Application of the Clarifying Amendment to this Appeal
It is of little consequence that the Association‘s initial argument was based in contract. This is not a case where the contractual language possesses a “scope independent of the proper construction of the statute” based on some specific facts or the intent of the parties at formation. Pennzoil Co. v. F.E.R.C., 645 F.2d 360, 386 n.54 (5th Cir. 1981) (citing Skelly Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 678 (1950)). In the absence of evidence that the Association and Devo intended to execute a contract beyond the scope of section
Section
IV. CONCLUSION
Guided by the legislature‘s recent clarification of section
Reversed; remanded for proceedings consistent with this opinion.
WALLACE and LaROSE, JJ., Concur.