Dolphin LLC v. Wci Cmtys., Inc.

• Citation: 715 F.3d 1243
• Decision Date: 01 May 2013
• Docket Number: No. 12–14068,Non–Argument Calendar.,12–14068,n–Argument Calendar.
• Parties: DOLPHIN LLC, a Florida Limited Liability Company, Plaintiff–Counter Defendant–Appellant, v. WCI COMMUNITIES, INC., a Delaware Corporation, Defendant–Counter Claimant–Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

715 F.3d 1243

DOLPHIN LLC, a Florida Limited Liability Company, Plaintiff–Counter Defendant–Appellant,

v.WCI COMMUNITIES, INC., a Delaware Corporation, Defendant–Counter Claimant–Appellee.

No. 12–14068

Non–Argument Calendar.

United States Court of Appeals,Eleventh Circuit.

May 1, 2013.

James Daniel Ryan, Timothy Powers O'Neill, Ryan Law Group, LLC, North Palm Beach, FL, for Plaintiff–Appellant.

David M. Pernini, Joseph D. Wargo, Wargo & French, LLP, Atlanta, GA, Eric C. Christu, Shutts & Bowen, LLP, West Palm Beach, FL, for Defendant–Appellant.

Appeal from the United States District Court for the Southern District of Florida.

Before TJOFLAT, PRYOR and MARTIN, Circuit Judges.

PER CURIAM:

A buyer of a condominium unit brought this suit against the seller, claiming violations under the Interstate Land Sales Full Disclosure Act ¹ (“ILSFDA”), 15 U.S.C. §§ 1701– 1720, and the Florida Deceptive and Unfair Trade Practices Act² (“FDUTPA”), Fla. Stat. §§ 501.201– 501.213. The District Court granted the seller's motion for summary judgment, concluding that the buyer failed to show that the development containing the condominium unit was subject to the ILSFDA or that the seller violated the FDUTPA. We affirm.

I.

On September 7, 2004, Dolphin, LLC, entered into a residence purchase contract to buy a condominium unit in an unfinished building called One Singer Island from WCI Communities, Inc., the developer and owner of the property. To secure its right to purchase the unit, Dolphin deposited $560,000 with an escrow agent. When it was time to close on the property, Dolphin refused and demanded the return of its deposit. WCI denied the demand.

On March 14, 2007, Dolphin filed suit in the United States District Court for the Southern District of Florida, seeking rescission of the contract, the return of the $560,000 deposit, and attorney's fees based on an attorney-fee provision in the contract. The amended complaint asserted two claims against WCI. First, Dolphin claimed that WCI violated several provisions of the ILSFDA by (1) making untrue statements of material fact in connection with the sale, in violation of 15 U.S.C. § 1703(a)(2)(B); (2) failing to provide Dolphin with a property report, in violation of id. § 1703(a)(1)(B); and (3) failing to include the terms required by § 1703(d) in the contract. Second, Dolphin claimed that WCI violated the FDUTPA by representing that a WCI-affiliated title company charged the “minimum” rate allowable under Florida law for title insurance—when in fact, according to Dolphin, no minimum rate exists. Dolphin also asserted that WCI's failure to provide a promised completion date while accepting a deposit constituted an unfair trade practice. ³

In its answer, WCI claimed that the transaction was exempt from the ILSFDA and denied that it violated the FDUTPA. WCI also brought a counterclaim for breach of contract, seeking a judgment in the amount of $560,000 and attorney's fees for defending Dolphin's action and prosecuting its counterclaim based on the contract's attorney-fee provision.⁴ On November 23, 2007, WCI moved for summary judgment on all claims brought by Dolphin. WCI did not move for summary judgment on its counterclaim. On November 26, 2007, Dolphin moved for partial summary judgment on its ILSFDA claim and on WCI's affirmative defense that asserted WCI was exempt from the ILSFDA's requirements.

The District Court granted summary judgment in favor of WCI and denied Dolphin's motion. The court ruled that Dolphin had failed to present evidence from which a reasonable jury could conclude that One Singer Island was subject to the provisions of the ILSFDA. In particular, the court found that there was no evidence to suggest that One Singer Island was advertised in common with other developments—a finding that would have placed the property under the ILSFDA. The court also ruled against Dolphin's FDUTPA claim. Noting that the Florida Insurance Commission is authorized by statute to set a specific premium to be charged by title insurers in the State of Florida, the court found that labeling this premium as the “minimum rate promulgated by the Florida Department of Insurance” was not misleading. In addition, the court also noted that Dolphin failed to state a claim under the FDUTPA because it did not plead any facts indicating that WCI's alleged misrepresentation was the cause of Dolphin's claimed damages. On February 20, 2008, the court entered final judgment against Dolphin and in favor of WCI. The court did not expressly address WCI's counterclaim for breach of contract in its final judgment, but it reserved jurisdiction to award attorney's fees.

On February 22, 2008, Dolphin filed a notice of appeal. A panel of this court dismissed the appeal as premature, holding that the judgment of the District Court was not final under 28 U.S.C. § 1291 because the question of attorney's fees constituted a substantive issue of the case that had not been resolved. Dolphin LLC v. WCI Cmtys., Inc., No. 08–10875, slip op. at 5 (11th Cir. Feb. 23, 2012). On July 12, 2012, on remand, the District Court entered a judgment that awarded attorney's fees to WCI for both defending Dolphin's action and prosecuting its own counterclaim, and then dismissed the case.

Dolphin now appeals, claiming that the District Court erred in ruling that (1) Dolphin failed to show that the transaction was subject to the ILSFDA; (2) WCI's description of “minimum rate” was not a violation of the FDUTPA; and (3) WCI was entitled to attorney's fees under the contract.

II.

We review a district court's grant of summary judgment de novo. Ellis v. England, 432 F.3d 1321, 1325 (11th Cir.2005). In conducting this review, we view the facts and all reasonable inferences from the record in the light most favorable to the non-moving party. Id. The moving party bears the burden of establishing the absence of a genuine issue of material fact and that it is entitled to judgment as a matter of law. Bailey v. Allgas, Inc., 284 F.3d 1237, 1243 (11th Cir.2002). The non-moving party bears the burden of presenting evidence of each essential element of his claim, such that a reasonable jury could rule in his favor. Id.

A.

Dolphin's ILSFDA claim depends on whether it can establish that the properties at One Singer Island were marketed under a common promotional plan, which would bring One Singer Island within the ambit of ILSFDA's requirements. WCI has indicated that One Singer Island is exempt from the ILSFDA because the development contains only fifteen condominium units. See15 U.S.C. § 1702(a)(1) (“[T]he provisions of this chapter shall not apply to the sale or lease of lots in a subdivision containing less than twenty-five lots.”). Dolphin contends, however, that WCI does not qualify for this exemption because the units at One Singer Island were marketed together with units from The Resort at Singer Island (“The Resort”), another development owned by WCI, under a common promotional plan. There are over 100 units between One Singer Island and The Resort. If the number of units offered by these two developments were counted together, One Singer Island would not qualify for an ILSFDA exemption.

A common promotional plan is presumed to exist between multiple developments where (1) the land is offered for sale by a single developer or developers acting in concert and (2) the land is “contiguous or is known, designated, or advertised as a common unit or by a common name.” Id. § 1701(4).⁵ If these two elements are satisfied,the number of units in the developments shall be counted together, without regard to the number of units covered by each individual development, when determining whether the developments qualify for an ILSFDA exemption. Id.

Dolphin argues that it was entitled to a presumption that there was a common promotional plan between One Singer Island and The Resort because it presented evidence that satisfied the Department of Housing and Urban Development (“HUD”) enforcement guidelines for the ILSFDA. These guidelines describe when HUD will presume that a common promotional plan exists: “If there is [1] common ownership or if the developers are acting in concert, and [2] there is [i] common advertising, [ii] sales agents or [iii] sales office, a common promotional plan is presumed to exist.” Guidelines to the Interstate Lands Sales Registration Program, 61 Fed.Reg. 13,596, 13,602 (Mar. 27, 1996). Dolphin presented evidence that WCI owned One Singer Island and The Resort. It also presented evidence that these developments had a common sales office and common sales agents. The record indicates that WCI's employees identified themselves as sales agents for both developments. The record also includes correspondence from sales associates regarding One Singer Island on letterhead listing The Resort's address, suggesting that One Singer Island and The Resort maintained a common sales office. In sum, the record suggests that WCI's activities would qualify for a common-promotional-plan presumption under the HUD guidelines.

Dolphin claims that this was sufficient to survive summary judgment. It argues that the HUD guidelines constitute an agency interpretation of the term “common promotional plan” and are entitled to deference under Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). The HUD guidelines, however, are not entitled to Chevron deference because they lack the force of law. See Christensen v. Harris Cnty., 529 U.S. 576, 587, 120 S.Ct. 1655, 1662, 146 L.Ed.2d 621 (2000) ( “Interpretations such as those in opinion letters—like interpretations contained in policy statements, agency manuals, and enforcement guidelines, all of which lack the force of law—do not warrant Chevron-style deference.”); Stein v. Paradigm Mirasol, LLC, 586 F.3d 849, 858 n. 7 (11th Cir.2009) ( “Because the HUD Guidelines are not published regulations subject to the rigors of the Administrative...