Dolores MILLETTE, Plaintiff-Appellant, v. Billie TARNOVE, individually, Defendant-Appellee, Nadeau General Contractors, Inc., a Florida corporation, Defendant-Appellee, Garnishee-Third Party Plaintiff, Dek Technologies, Inc., a Florida corporation, Webster Bank, N.A., a National Banking Association, Pablo Camus, individually, Steve Lambert, individually, Robert Imperato, individually, Defendants, Steven Cummings, Defendant-Third Party Defendant, Todd Mitchell Smith, Third Party Defendant.
No. 10-13950.
United States Court of Appeals, Eleventh Circuit.
July 22, 2011.
Julie E. Hough, Patrick S. Scott & Associates, Ft Lauderdale, FL, Charles W. Throckmorton, Kozyak, Tropin & Throckmorton, P.A., Coral Gables, FL, for Defendants.
Steven Cummings, Placida, FL, pro se.
Before PRYOR and COX, Circuit Judges, and PANNELL,* District Judge.
PER CURIAM:
The appeal in this diversity action presents issues involving two claims tried to a jury in the district court: (1) Dolores Millette‘s negligence claim against Nadeau General Contractors, Inc. (“Nadeau“) for defective and incomplete construction of her house in North Port, Florida; and (2) Millette‘s claim against Billie Tarnove for breaching her fiduciary duty as closing agent for the purchase of the property on which Millette‘s home was to be built.
At the conclusion of Millette‘s case-in-chief, the district court granted Tarnove‘s Rule 50(a) motion for judgment as a matter of law. Millette contends this was error. We agree.
I. ISSUES ON APPEAL
Millette presents the following issues on appeal: (1) whether the district court erred in permitting Nadeau to identify nonparties on the verdict form for the purpose of apportioning fault under
II. STANDARDS OF REVIEW
We review a district court‘s determinations of state law de novo. Bearint ex rel. Bearint v. Dorell Juvenile Grp., Inc., 389 F.3d 1339, 1345 (11th Cir. 2004) (citation omitted).
We review a Rule 50 motion for judgment as a matter of law de novo, and apply the same standards employed by the district court. Abel v. Dubberly, 210 F.3d 1334, 1337 (11th Cir. 2000) (citation omitted). “In doing so, we consider all the evidence in the light most favorable to the non-moving party, and independently determine whether the facts and inferences point so overwhelmingly in favor of the movant ... that reasonable people could not arrive at a contrary verdict.” Webb-Edwards v. Orange Cnty. Sheriff‘s Office, 525 F.3d 1013, 1029 (11th Cir. 2008) (citation omitted and omission in original).
III. DISCUSSION
A. Apportionment of Fault Under Fla. Stat. § 768.81
The Supreme Court of Florida has held that the comparative fault statute,
Before addressing Millette‘s arguments as to why the district court erred in including these nonparties on the verdict form, we note that Nadeau has not met the pleading requirements of
1. Submission of intentional-tortfeasor question to the jury
Florida‘s comparative fault statute requires the court to determine whether the statute applies to a given case.
Section 768.81(4)(b) further explains that the statute does not apply “to any action based upon an intentional tort.” Florida courts have interpreted this language to mean that a defendant charged with negligence cannot apportion fault to a nonparty whose intentional conduct was a foreseeable result of the defendant‘s alleged negligence. See Merrill, 705 So. 2d at 562. We conclude that
We cannot accept Nadeau‘s argument that, even if submitting the intentional-tortfeasor question to the jury was error, the error is harmless because the jury properly considered and rejected any argument that Camus/DEK were intentional tortfeasors. The jury was instructed “not to apportion fault to any person/entity found to have intentionally caused injury to Millette.” (Dkt. 472 at 10.) But no legal definition of an intentional tort was provided. See, e.g., D‘Amario v. Ford Motor Co., 806 So. 2d 424, 438 (Fla. 2001) (defining an intentional tort as “one in which the actor exhibits a deliberate intent to injure or engages in conduct which is substantially certain to result in injury ...“). Moreover, the statute requires the judge to decide the issue.
Because the court should have decided the intentional-tortfeasor issue, we must vacate the district court‘s judgment to the extent that it apportioned fault. On remand, the court must determine whether nonparties committed intentional torts. If so, they cannot be apportioned fault under
2. Apportionment of fault among nonparties in contractual privity with Millette
Millette contends that the district court erred in allowing the jury to apportion fault to Camus/DEK and Webster Bank because they had a contract with Millette. She makes two arguments in
Millette first argues that Camus/DEK and Webster Bank had contracts with Millette and therefore cannot be apportioned fault because the Florida economic loss rule prevents Millette from suing them in tort. Under the economic loss rule, a party to a contract may not pursue a claim in tort solely for economic losses unless the party breaching the contract has committed a tort which is distinguishable from or independent of the breach of contract. See, e.g., Indemnity Ins. Co. of N. Am. v. Am. Aviation, Inc., 891 So. 2d 532, 536-37 (Fla. 2004); see also Fla. Power & Light Co. v. Westinghouse Elec. Corp., 510 So. 2d 899, 902 (Fla. 1987). Because the economic loss rule precludes Millette from suing Camus/DEK and Webster Bank in tort, she reasons that it is improper for Nadeau to decrease its percentage of fault (and Millette‘s recovery) by apportioning fault to these persons and entities. We are not persuaded.
Millette‘s inability to recover in tort from a nonparty due to the economic loss rule does not preclude apportioning fault to that nonparty. Florida courts have repeatedly interpreted the comparative fault statute to allow for apportionment of fault even if the plaintiff could not sue the nonparty in tort. As the Florida Supreme Court explained, “the only means of determining a party‘s percentage of fault is to compare that party‘s percentage to all of the other entities who contributed to the accident, regardless of whether they have been or could have been joined as defendants.” Y.H. Invs., Inc. v. Godales, 690 So. 2d 1273, 1277 (Fla. 1997) (emphasis in original) (quoting Fabre, 623 So. 2d at 1185). As a result, a nonparty who enjoys an immunity from suit by the plaintiff can still be apportioned fault. See id. at 1278 (holding that apportionment of fault to parent was appropriate even though parent is immune from suit by child plaintiff); Allied-Signal, Inc. v. Fox, 623 So. 2d 1180, 1182 (Fla. 1993) (holding that apportionment of fault to employer was appropriate even though employer is immune under workers’ compensation law from suit by employee); Fabre, 623 So. 2d at 1185-86 (holding that apportionment of fault to spouse was appropriate even though spouse was immune from suit by the other spouse). Similar to a tort immunity, the economic loss rule precludes Millette from suing nonparties in tort under certain circumstances. But the inability to sue Camus/DEK and Webster Bank in tort does not preclude apportioning fault to these entities.
Millette also argues that Camus/DEK and Webster Bank cannot be apportioned fault because they owe no duty in tort to Millette. Millette reasons that, because the economic loss rule prevents her from suing Camus/DEK and Webster Bank in tort, they do not owe a duty of reasonable care to Millette and thus cannot be apportioned fault for causing her damages. We disagree. The purpose of the economic loss rule is to prevent parties to a contract from “‘circumventing the allocation of losses set forth in their contract by bringing an action for economic loss in tort’ and thereby ‘seeking to obtain a better bargain than originally made.‘” Cessna Aircraft Co. v. Avior Techs., Inc., 990 So. 2d 532, 537 (Fla. 3d DCA 2008) (quoting Indem. Ins. Co., 891 So. 2d at 536). Considering that the purpose of the economic loss rule is to prevent a tort duty from intruding on the bargained-for allocation of loss, permitting Nadeau to apportion fault to Camus/DEK and Webster Bank makes sense. Nadeau has no contract with Millette, so the apportioning of fault to Camus/DEK and Webster Bank does not avoid or alter any of Nadeau‘s contractual obligations. To the contrary, allowing Nadeau to ap-
While we conclude that a nonparty may be apportioned fault even though that nonparty has a contract with the plaintiff, we question whether apportioning fault to Webster Bank was appropriate under the facts of this case. See Armetta v. Clevetrust Realty Investors, 359 So. 2d 540, 543 (Fla. 4th DCA 1978) (citing Schaeffer v. Gilmer, 353 So. 2d 847 (Fla. 1st DCA 1977) (“A lender owes no duty to others to supervise the construction and development of projects which it has financed.“)); Sobi v. First South Bank, Inc., 946 So. 2d 615, 617 (Fla. 1st DCA 2007) (“[U]nder Florida law, as a general rule a lender has no liability for construction defects.“). No party has cited these cases or discussed the general duty of a lender under Florida law. We therefore do not address whether reasons independent of the presence of a contract preclude the apportionment of fault to Webster Bank. Because other issues require a new trial on the apportionment of fault, we leave to the district court the issue of whether Nadeau can allege and present proof of Webster Bank‘s negligence under Florida law.
3. Apportionment of fault among joint tortfeasors
Millette argues that the district court erred by including Todd Smith and Steve Cummings on the verdict form for apportionment of fault because they were not joint tortfeasors. Millette also argues that the district court erred in denying Millette‘s requested jury instruction regarding joint and successive tortfeasors.
We cannot address whether Smith and Cummings are joint tortfeasors because, as noted, Nadeau has not plead any facts outlining the basis for apportioning fault to Smith and Cummings.
B. Tarnove‘s Rule 50(a) Motion
The district court granted Tarnove‘s Rule 50(a) motion for judgment as a matter of law on Millette‘s claim that Tarnove breached her fiduciary duty as closing agent.6 Millette‘s breach of fiduciary duty claim is based on two alleged breaches. We address each in turn.
1. Failure to provide title report
Millette argues that Tarnove breached her fiduciary duty as closing agent because she did not provide Millette with a title report before the closing of the purchase of the property, and the title report would have revealed two pre-existing mortgages on the property. Millette‘s property was released from the pre-existing mortgages when those mortgages were paid using the closing proceeds due to DEK, the seller. But, the satisfaction of the mortgages was not executed and recorded until fifteen months after closing, in December 2006. The district court granted Tarnove‘s Rule 50(a) motion on this claim because Millette did not produce evidence that she suffered damages as a result of Tarnove‘s failure to provide the title report. Millette claims this was error, arguing that she suffered damages because: (1) she would have exercised her right under the purchase contract to rescind the entire transaction had she received a title report advising her of the pre-existing mortgages; and (2) she
We agree with the district court that Millette produced no evidence showing that Tarnove‘s failure to provide a title report caused damage to Millette. First, Millette did not have the contractual right to rescind the transaction due to a potential title defect at closing; instead, Paragraph Eight of the Purchase Contract provides that Tarnove could have cured any title defects by the closing date or within a reasonable time. (Dkt. 636-3 at 2.) Second, Millette did not suffer damages by paying interest on her loan with Webster Bank for fifteen months while Webster Bank did not have first-lien position. Even if Webster Bank did not have first-lien position, this fact does not relieve Millette of the obligation to pay the principal and interest on the loan. The district court did not err in granting Tarnove‘s Rule 50(a) motion on the breach of fiduciary duty claim involving the title report.
2. Alteration of HUD-1 settlement statement
Millette argues that Tarnove breached her fiduciary duty as closing agent because she altered the HUD-1 settlement statement without Millette‘s consent. After Millette closed on the purchase of the property and home, Webster Bank requested that Tarnove change the HUD-1 statement to reflect a charge to Millette of $8,790 for a real estate broker commission. Tarnove prepared and faxed the changed statement to Webster Bank. Tarnove did not inform Millette about Webster Bank‘s request and Millette did not consent to an alteration of the HUD-1 statement. As a result of the alteration, Millette was required to pay an additional $8,790 for a real estate broker commission.
The district court granted Tarnove‘s Rule 50(a) motion on this claim, concluding that Millette failed to produce any evidence of damages. (Dkt. 611 at 1185-86.) While we agree that Millette did not produce any evidence of damages stemming from Tarnove‘s failure to produce a title report, the alleged alteration of the HUD-1 statement is a different matter. Contrary to the district court‘s no-damage finding, the record shows that Millette did suffer some damages as a result of the alteration of the closing statement. Her construction loan was charged an additional $8,790, when the construction holdback was reduced from $207,210 to $198,420. Thus, Millette‘s purported failure to prove damages does not entitle Tarnove to judgment as a matter of law on the claim that she breached her fiduciary duty by altering the HUD-1 settlement statement.7
IV. CONCLUSION
The district court erred by leaving to the jury the issue of whether Camus/DEK committed intentional torts. As a result, we vacate the judgment against Nadeau to the extent it apportioned fault and remand for a new trial on all apportionment issues.
We note that our vacation of the district court‘s judgment as to apportionment does
The district court did not err in granting Tarnove‘s Rule 50(a) motion on the claim that Tarnove breached her duty by failing to provide a title report. The district court did err in granting Tarnove‘s Rule 50(a) motion on the claim that Tarnove breached her duty by altering the HUD-1 settlement statement; we vacate the judgment in favor of Tarnove. We do not foreclose the possibility that Tarnove may be entitled to judgment for a reason other than Millette‘s failure to prove damages for this claim. We vacate the award of attorney‘s fees to Tarnove and remand for further proceedings.
AFFIRMED IN PART, VACATED IN PART, AND REMANDED WITH INSTRUCTIONS.