BDO Seidman v. British Car Auctions, Inc.

• Citation: 802 So.2d 366
• Decision Date: 31 October 2001
• Docket Number: No. 4D00-4297.,4D00-4297.
• Parties: BDO SEIDMAN, LLP, f/k/a BDO Seidman, a partnership, Appellant, v. BRITISH CAR AUCTIONS, INC., a corporation, and ADT Automotive, Inc., a corporation, Appellees.
• Court: Court of Appeal of Florida (US)

802 So.2d 366

BDO SEIDMAN, LLP, f/k/a BDO Seidman, a partnership, Appellant, v. BRITISH CAR AUCTIONS, INC., a corporation, and ADT Automotive, Inc., a corporation, Appellees.

No. 4D00-4297.

District Court of Appeal of Florida, Fourth District.

October 31, 2001.

Rehearing Denied December 26, 2001.

Daniel S. Pearson, and Lenore C. Smith of Holland & Knight, LLP, Miami, for appellant.

Timothy J. McDermott, and J. Riley Williams of Akerman, Senterfitt & Eidson, P.A., Jacksonville, and Paul R. Regensdorf of Akerman, Senterfitt & Eidson, P.A., Fort Lauderdale, for appellee British Car Auctions, Inc., a corporation.

KLEIN, J.

The issue in this case is whether Florida's offer of judgment statute can be utilized in a case arising in Tennessee but litigated in Florida under Tennessee substantive law. We conclude that this should not be resolved under conflict of laws principles, and that the statute applies in this case.

British Car Auctions received tax advice in Tennessee from BDO Seidman, LLP, an accounting firm, and sued Seidman for professional malpractice in Florida. Prior to trial, each party made an offer of judgment pursuant to section 768.79, Florida Statutes (1991), but neither offer was accepted. A jury found Seidman to have been negligent and awarded damages of $3,200,662. British Car was awarded attorney's fees under section 768.79, and Seidman appealed both the damages and fees.

Applying Tennessee law, which the parties agreed governed, we held that the malpractice suit was barred by the Tennessee statute of limitations. BDO Seidman, LLP v. British Car Auctions, Inc., 745 So.2d 1082 (Fla. 4th DCA 1999).¹ We reversed for entry of judgment in favor of Seidman without reaching the issue of attorney's fees, which had become moot.

Following the mandate, the trial court entered judgment in favor of defendant Seidman, and Seidman moved for attorney's fees under its section 768.79 offer of judgment. Acknowledging that it had taken a different position on the prior appeal, Seidman said that it had been mistaken when it argued that Tennessee law controlled the issue of attorney's fees. Ruling that Tennessee law "preempts" Florida law on the issue of fees, the trial court denied Seidman's motion, and Seidman appeals.

We first address British Car's argument that Seidman was estopped from changing its position and seeking fees under section 768.79. Both parties made offers of judgment pursuant to the statute and, at different times in the litigation, each party changed its position on the applicability of it. Neither side has been prejudiced by the other's change of position, which involved only a question of law. Both parties had equal opportunity, and similar difficulty, in attempting to find the answer to what was a question of first impression. There was accordingly no estoppel. See Metropolitan Dade County v. Jones Boatyard, Inc., 611 So.2d 512, 514 (Fla.1993)

; Chase & Co. v. Little, 116 Fla. 667, 156 So. 609, 611 (Fla.1934); Palm Beach County v. Palm Beach Estates, 110 Fla. 77, 148 So. 544, 548 (Fla.1933); Rafkind v. Simon, 402 So.2d 22, 24 (Fla. 3d DCA 1981).

Proceeding to the merits, Seidman and British Car both rely on a conflict of laws analysis. Seidman's reasoning reaches the result that section 768.79 is procedural and therefore applies. British Car's argument is that the statute is substantive and should not be applied to this out-of-state cause of action.

Section 768.79(1), Florida Statutes (1991), applies to "any civil action for damages filed in the courts of this state." (emphasis supplied.) This statute is clear, and on its face is applicable to this action for damages. It is also constitutional. See TGI Friday's, Inc. v. Dvorak, 663 So.2d 606, 611 (Fla.1995)

. We conclude that, because the statute is clear, it should be applied without engaging in a conflict of laws analysis.

As the Florida Supreme Court explained in City of Jacksonville v. Bowden, 67 Fla. 181, 64 So. 769, 772 (1914):

Where a statute does not violate the federal or state Constitution, the legislative will is supreme, and its policy is not subject to judicial review. The courts have no veto power, and do not assume to regulate state policy, but they recognize and enforce the policy of the law as expressed in valid enactments, and decline to enforce statutes only when to do so would violate organic law.

Choice of law considerations, where laws of different states or nations are involved, involve public policy decisions. Restatement (Second) of Conflict of Laws § 6 (1971). In Hartford Accident & Indemnity Co. v. City of Thomasville, Ga., 100 Fla. 748, 130 So. 7, 8 (1930), the Florida Supreme Court explained:

The extent and scope to which the rule of comity will operate is not universal, but will be determined by each sovereignty under the controlling facts of the particular case. It does not require a court to enforce rights given by the statutes of another state to the prejudice of its own citizens, or when complete justice cannot be done, nor will the courts of one state enforce laws of another state which are repugnant to its own or to public policy.

When the Legislature enacted section 768.79, it was making a policy determination that attorney's fees should be recoverable under certain circumstances. The Florida Bar Re Amendment to Rules of Civil Procedure, 550 So.2d 442 (Fla.1989). Implicit in that policy determination was the decision that the statute would apply to "any" civil action for damages.

If we were to engage in a conflict of laws analysis, which would involve applying other policies, it would, if we held the statute not applicable, violate the principle that a policy decision of a court "must yield to a valid, contrary legislative pronouncement." VanBibber v. Hartford Acc. & Indem. Ins. Co., 439 So.2d 880, 883 (Fla.1983). See also Brown v. Case, 80 Fla. 703, 86 So. 684 (1920)(in the absence of a statute to the contrary, conflict of law principles, based on public policy will be applied to determine whether the law of the forum state or the law of the state where the cause of action accrued will be applied).

No Florida court, so far as our research indicates, has applied a conflicts of law analysis in order to determine whether a statute, which is clear and constitutional, should be applied. In Weatherby Associates, Inc. v. Ballack, 783 So.2d 1138, 1143 (Fla. 4th DCA 2001), the issue was whether a court could assess attorney's fees for bringing a frivolous lawsuit, under section 57.105(1), Florida Statutes (1999), in a case in which Connecticut substantive law applied. Without engaging in a conflict of law analysis, we concluded that the statute applied because the plaintiff "filed and pursued a baseless lawsuit in a Florida court."

Our view that conflict principles should not be applied where the statute is clear is supported by the Restatement (Second) of Conflict of Laws § 6, cmt. b. (1971), in which it is stated:

The court should give a local statute the range of application intended by the legislature when these intentions can be ascertained and can constitutionally be given effect. If the legislature intended that the statute should be applied to the out-of-state facts involved, the court should so apply it unless constitutional considerations forbid. On the other hand, if the legislature intended that the statute should be applied only to acts taking place within the state, the statute should not be given a wider range of application.... Provided that it is constitutional to do so, the court will apply a local statute in the manner intended by the legislature even when the local law of another state would be applicable under usual choice-of-law principles. [emphasis supplied.]

Section 6 of the Restatement (Second) was relied on by the Florida Supreme Court in Bishop v. Florida Specialty Paint Co., 389 So.2d 999, 1001 (Fla.1980).

Our conclusion that section 768.79 applies to all civil actions for damages brought in Florida courts is consistent with the legislative intent, which is to reduce litigation. Aspen v. Bayless, 564 So.2d 1081, 1083 (Fla.1990). An action for damages based on the substantive law of another jurisdiction has the same impact on the Florida court system as one based on the substantive law of Florida.

We acknowledge that the eleventh circuit has recently held that section 768.79 is substantive under Florida conflict of laws principles. McMahan v. Toto, 256 F.3d 1120 (11th Cir.2001). This decision is persuasive, but not binding on us. State v. Dwyer, 332 So.2d 333 (Fla.1976). We respectfully disagree with it. See Judge Gross' concurring opinion.

We therefore reverse and remand for the trial court to award attorney's fees to Seidman under its section 768.79 offer of judgment.

GROSS, J., concurs specially with opinion.

POLEN, C.J., dissents with opinion.

GROSS, J., concurring specially.

I concur with Judge Klein's opinion. I write separately to note that even under a choice of law analysis, Seidman is entitled to recover fees under section 768.79, Florida Statutes (1991).² This is so because the offer of judgment statute is "procedural" under Florida choice of law terminology; it is part of the machinery of Florida's judicial process that promotes judicial economy.

British Car's main argument is straight-forward. "Tennessee law governs substantive matters in this dispute; Florida law controls procedural issues only." Tennessee law does not allow a prevailing party to recover attorney's fees; the Florida supreme court has described the right to attorney's fees under section 768.79 as "substantive." See Knealing v. Puleo, 675 So.2d 593, 596 (Fla.1996)

(stating that section 768.79 contains "substantive provisions authorizing an award of attorney [sic] fees"); TGI Friday's, Inc. v. Dvorak, 663 So.2d 606, 611 (Fla.1995) ("The legislature has modified the American rule, in which each party pays its own attorney's fees, and has created a substantive right to attorney's...