Attorney's Title Ins. Fund v. Landa-Posada

• Decision Date: 18 June 2008
• Docket Number: No. 3D07-2263.,3D07-2263.
• Citation: 984 So.2d 641
• Parties: ATTORNEY'S TITLE INSURANCE FUND, INC., Appellant, v. Maria LANDA-POSADA, Appellee.
• Court: Florida District Court of Appeals

984 So.2d 641

ATTORNEY'S TITLE INSURANCE FUND, INC., Appellant, v. Maria LANDA-POSADA, Appellee.

No. 3D07-2263.

District Court of Appeal of Florida, Third District.

June 18, 2008.

Cohen Fox P.A., Miami, Aaron C. Wong, and Cynthia Morales, for appellant.

Langstadt Pauly Chartered, Clemens W. Pauly, Coral Gables and Oliver J. Langstadt, Miami, for appellee.

Before COPE and LAGOA, JJ., and PLEUS, JR., Associate Judge.

PER CURIAM.

Attorney's Title Insurance Fund, Inc. ("The Fund") appeals the trial court's grant of attorney's fees to a non-party, Maria Landa-Posada, for responding to a subpoena duces tecum propounded by The Fund. Concluding that the trial judge had no authority to award attorney's fees, we reverse.

The Fund is a title insurance underwriter that insures real estate purchasers and mortgage lenders in conjunction with real estate closings conducted by member agents who are licensed attorneys. The Fund insures not only the title to the real property at issue, but also the sanctity of the trust/escrow funds disbursed as part of the closing.

According to the allegations in The Fund's complaint filed below, after a number of claims, The Fund became aware that one of its attorney member-agents, Sarino R. Costanzo, was conducting fraudulent closings through his law firm, Sarino R. Costanzo, P.A. The Fund alleges that Costanzo had set up a satellite office in Dade County that was run and controlled by Vanessa Montalvo, a non-lawyer and non-member of The Fund. Montalvo's involvement was without the supervision of Costanzo and without The Fund's knowledge or consent.

Further, The Fund alleges that Ms. Montalvo, essentially, was operating a real estate/mortgage fraud "factory" out of Costanzo's office using stolen credit histories, "straw" buyers, and falsely inflated appraisals. These fraudulent documents were used to induce mortgage lenders, who were The Fund's insureds, to loan millions of dollars on fraudulent real estate deals orchestrated and closed by Montalvo herself. After the closings, Montalvo would electronically disburse the falsely-generated excess funds on each transaction from the Costanzo trust account to various accounts held in her name in the same bank. The misappropriated trust monies ran into the millions of dollars.

The Fund's suit names Montalvo, Costanzo and their co-conspirators for conversion, equitable lien and injunctive relief. The Fund issued a subpoena duces tecum for documents related to ten closings which had been referred to an attorney member-agent of The Fund, Landa-Posada. Landa-Posada, still a non-party to The Fund's law suit, was served with a subpoena duces tecum and a notice of deposition. The subpoena was specific and not overly broad. The time and effort to comply for Landa-Posada should have been minimal even considering the need to protect client confidentiality.

After the typical discovery protests on the grounds of attorney client privileges, Landa-Posada filed a "Response," a Privilege Log, and a Request for Reimbursement of Attorney's Fees and Costs. She conditioned her response upon The Fund's payment of her actual copying costs and compensation for her attorney's fees relating to the review of documents and preparation of the privilege log by outside counsel.

At Landa-Posada's deposition, she invoked her Fifth Amendment rights to each substantive question. After her deposition, a hearing was held on Landa-Posada's request for reimbursement of attorney's fees. The trial judge ordered The Fund to pay for her outside counsel. This was error.

Our standard of review is de novo because the ruling on the attorney's fees involves an erroneous interpretation and application of Florida law. This is not a case in which we review for...