DiStefano Const., Inc. v. Fidelity and Deposit Co. of Maryland

• Decision Date: 06 February 1992
• Docket Number: No. 76353,76353
• Citation: 597 So.2d 248
• Parties: 17 Fla. L. Weekly S83 DiSTEFANO CONSTRUCTION, INC., etc., Petitioner, v. FIDELITY AND DEPOSIT COMPANY OF MARYLAND, Respondent.
• Court: Florida Supreme Court

Page 248

597 So.2d 248

17 Fla. L. Weekly S83

DiSTEFANO CONSTRUCTION, INC., etc., Petitioner, v. FIDELITY AND DEPOSIT COMPANY OF MARYLAND, Respondent.

No. 76353.

Supreme Court of Florida.

Feb. 6, 1992.

Rehearing Denied May 26, 1992.

Ronald P. Gossett of Gossett & Gossett, P.A., Hollywood, for petitioner.

Patricia H. Thompson and Ubaldo J. Perez, Jr. of Popham, Haik, Schnobrich & Kaufman, Ltd., Miami, for respondent.

HARDING, Justice.

We have for review Fidelity & Deposit Co. v. DiStefano Construction, Inc., 562 So.2d 845 (Fla. 3d DCA 1990), based upon certified direct conflict with U.S. Fire Insurance Co. v. Sheffield Steel Products, Inc., 533 So.2d 782 (Fla. 5th DCA 1988), review denied, 542 So.2d 989 (Fla.1989), on the issue of whether section 627.428(1), Florida Statutes (1987), ¹ provides for an award of attorney's fees in an action to foreclose on a mechanic's lien secured by a transfer-of-lien bond. We have jurisdiction pursuant to article V, section 3(b)(4), Florida Constitution.

Fidelity and Deposit Company (Fidelity) was the surety on a lien-transfer bond ² in the amount of $26,060 issued on a claim of mechanic's lien filed by DiStefano Construction (DiStefano). DiStefano sued to foreclose on the lien. Following a trial, the court entered an order of foreclosure against the lien-transfer bond for $20,568.11, plus costs and attorney's fees. The Third District Court of Appeal affirmed the judgment of foreclosure and awarded attorney's fees for the appeal, to be set by the trial court. Pursuant to section 627.428, the trial court awarded DiStefano attorney's fees and costs totalling $52,400, to be paid by the surety, Fidelity. The trial court ordered an increase in the lien-transfer bond to cover this award of fees, and also reduced the attorney hours by thirty percent to reflect the time expended on the issue of late service of the contractor's affidavit, which the trial court attributed to the fault of counsel for DiStefano.

On appeal, the district court determined that the trial court erred in ordering the lien-transfer bond increased beyond the $500 amount authorized by section 713.24(1)(b), Florida Statutes (1987). ³ The district court also declined to look to section 627.428 for authority to award attorney's fees in an action to foreclose on a mechanic's lien. Accordingly, the district court reversed the increase in the lien-transfer bond and certified conflict with the Fifth District Court of Appeal on the applicability of section 627.428. As to the attorney-hours issue raised in the cross appeal, the district court affirmed the reduction in the number of hours reasonably expended.

DiStefano argues that the attorney's fees provision in section 627.428 is applicable to Fidelity as an insurer under the Florida Insurance Code. We do not agree with this interpretation. The award of attorney's fees under section 627.428, the general attorney's fees provision of the Florida Insurance Code, is specifically mandated in a number of circumstances, including against sureties issuing payment bonds or performance bonds ⁴ and against auto insurers contesting policy benefits under the provisions of the "Florida Motor Vehicle No-Fault Law." ⁵ There is no corresponding authorization of section 627.428 attorney's fees against a surety issuing a transfer-of-lien bond. Instead, mechanic's lien proceedings are governed by Chapter 713 of the Florida Statutes. Section 713.29, Florida Statutes (1987), provides that a prevailing party in a mechanic's lien enforcement action is entitled to recover attorney's fees "which shall be taxed as part of [the prevailing party's] costs." Accordingly, we agree with the court below that "[t]here is no need ... to look to section 627.428 for authority to award attorney's fees in an action to foreclose on a mechanic's lien." Fidelity & Deposit Co. v. DiStefano Constr., Inc., 562 So.2d at 847.

We also agree with the district court that the trial court erred in ordering the lien-transfer bond increased in an amount sufficient to include the award of attorney's fees. Id. at 846. However, we do not agree with the district court that section 713.24 only authorizes payment of costs up to $500. When this provision was amended in 1987, the legislature increased from $100 to $500 the amount that a surety must post toward any imposition of costs and deleted the limitation "and costs not to exceed $100." As this Court stated in Aetna Casualty & Surety Co. v. Buck, 594 So.2d 280 (Fla.1992), the omission of this language repealed the $100 cost recovery limitation on section 713.24 bonds. Any part of the lien-transfer bond not included in the foreclosure judgment can be used for payment of costs. However, the cost recovery is limited to the face amount of the bond. Here, the foreclosure judgment against the bond was $20,568.11, and the balance of the face amount of $26,060 is available to satisfy the award of attorney's fees and costs. DiStefano is left with an unsecured judgment for any costs which exceed the remaining face amount of the bond. See Aetna Casualty & Surety Co., at 283.

DiStefano also seeks reversal of the trial court's reduction in the number of attorney hours reasonably expended. In Florida Patient's Compensation Fund v. Rowe, 472 So.2d 1145 (Fla.1985), this Court recognized that a court may reduce the number of hours claimed if the court finds the hours to be excessive or unnecessary. Moreover, the award of attorney's fees is a matter committed to sound judicial discretion which will not be disturbed on appeal, absent a showing of clear abuse of discretion. Lucas v. Evans, 453 So.2d 141 (Fla. 1st DCA 1984); 3 Fla.Jur.2d Appellate Review Sec. 339 (1978). In the instant case, the trial court reduced the number of hours to reflect the time expended on the issue of the late service of the contractor's affidavit, which the trial court attributed...