Equity Lifestyle Properties v. Florida Mowing, No. 07-11342.

• Decision Date: 04 February 2009
• Docket Number: No. 07-11342.
• Citation: 556 F.3d 1232
• Parties: EQUITY LIFESTYLE PROPERTIES, INC., Plaintiff-Appellant, v. FLORIDA MOWING AND LANDSCAPE SERVICE, INC., Defendant-Appellee. Florida Mowing & Landscape Service, Inc., Plaintiff-Appellee, v. Equity Lifestyle Properties, Inc., f.k.a. Manufactured Home Communities, Inc., Defendant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

556 F.3d 1232

EQUITY LIFESTYLE PROPERTIES, INC., Plaintiff-Appellant, v. FLORIDA MOWING AND LANDSCAPE SERVICE, INC., Defendant-Appellee.

Florida Mowing & Landscape Service, Inc., Plaintiff-Appellee, v. Equity Lifestyle Properties, Inc., f.k.a. Manufactured Home Communities, Inc., Defendant-Appellant.

No. 07-11342.

United States Court of Appeals, Eleventh Circuit.

February 4, 2009.

David I. Spector, Venus A. Zilieris, Schwarzberg, Spector, Duke, Schulz & Rogers, West Palm Beach, FL, for Appellant.

John Charles Coleman, Colean & Coleman, Fort Myers, FL, for Appellee.

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

Before TJOFLAT, MARCUS and WILSON, Circuit Judges.

TJOFLAT, Circuit Judge:

These two consolidated cases arose out of a contractual dispute between Florida Mowing and Landscape Service, Inc. ("Florida Mowing") and Equity Lifestyle Properties, Inc. ("Equity"). After the district court dismissed Equity's third amended complaint for failure to comply with a court order, the case proceeded to trial before a jury on Florida Mowing's breach of contract claim that Equity owed it $564,101.50 for work performed. The jury found for Florida Mowing in that amount, and after the district court entered judgment for Florida Mowing in both cases, Equity brought this appeal. Equity seeks alternative resolutions of its appeal. First, contending that the district court abused its discretion in dismissing its third amended complaint, Equity asks that we vacate the district court's judgment, direct the reinstatement of its third amended complaint, and remand the case for a new trial in both cases. Second, assuming that we sustain the district court's order dismissing that complaint, Equity asks that we vacate the district court's judgment and remand the case for a new trial on the grounds that the district court erred in construing the parties' contract and abused its discretion in admitting Florida Mowing's invoices into evidence under Federal Rule of Evidence 803(6). We deny Equity's requests and accordingly affirm.

I.

A.

Equity owns and operates five residential manufactured home communities in Fort Myers, Florida. On August 14, 2004, after Hurricane Charley came through the Fort Myers area, Equity contracted with Florida Mowing to remove debris from these properties. The parties' agreement was drafted by Florida Mowing's manager, Julian Wright, in consultation with Equity's district manager, Barbara Stanze.¹ The agreement's cost-plus provision read as follows:

It is also understood by both parties that the cost of this project is an unknown factor, and cannot be taken lightly, because of the state of condition that surrounds it. It is impossible to estimate a true cost, so therefore both parties agree that the contractor will bill bi-weekly and this will be a cost plus percentage markup on the costs, for the contract. The markup or percentage after costs will be based on 27% of the total costs, and will be paid upon completion of contract.

The agreement then specified that:

The contractor will bill on the basis of a daily charge, being a 10 hour work day, and to be paid on a unit basis, small & large. The cost of the large unit would be $4,600.00 a day x quantity of units. The cost of the small unit would be $1,650.00 a day x the quantity of units.

Large units were defined to include five pieces of heavy equipment, three equipment operators, and two hand laborers. Small units included two pieces of heavy equipment, one equipment operator, and two hand laborers. One month after reaching this agreement, the parties signed an addendum to the contract under which Florida Mowing would also provide "final cleanup units," consisting of two pieces of heavy equipment, one equipment operator, and three hand laborers, at a cost of $1,650.00 per day.

Florida Mowing commenced the cleanup work on August 21, 2004, and finished it on January 10, 2005. In total, Florida Mowing performed twenty weeks of work. At the close of a typical work day, the foremen in charge of the work at the manufactured home communities called Wright and informed him of the number of large and small units used that day. Wright noted this information on legal pads, scraps of paper, or cardboard, whatever might be handy when a foreman called. Then, Wright copied the information onto "white boards" at Florida Mowing's home office and discarded his notes. At the end of the work week, he transferred the information on the white boards onto a handwritten invoice, which his wife typed into final form. In all, she prepared twenty weekly invoices reflecting the units employed during the week.² Wright forwarded these invoices to Equity on a bi-weekly basis. Equity only disputed one invoice because it contained an arithmetical error.

Florida Mowing also provided Equity with three "summary" invoices. Florida Mowing issued the first summary invoice after week 7. This invoice included only the 27% markup due from weeks 1 through 7. The invoice purported to break down the 27% markup as:

Mobilization & Demobilization @ 12% of Cost

Support Equipment & Personell [sic] @ 10% of Cost

Administrative @ 5% of Cost

Florida Mowing issued the second summary invoice at the end of week 19, to cover the 27% markup for weeks 8 through 19. The third summary invoice, Florida Mowing's final invoice, issued at the end of week 20, and repeated the amounts due in the second summary invoice.³

Equity paid twenty-three of the twenty-five invoices Florida Mowing submitted. In February 2005, several weeks after Florida Mowing had completed its work, Equity refused to pay the invoice for week 17, in the amount of $150,245.00, and the final invoice for $413,316.50, which reflected the 27% markup due for weeks 8 through 19. Equity stated that it would not pay those invoices until Florida Mowing provided it with underlying documentation showing the costs Florida Mowing actually incurred for labor and equipment on the job. Florida Mowing responded that it had not retained the underlying documents and that such documentation was unnecessary because the contractual term "costs" meant the amounts specified for the large, small, and final cleanup units.

B.

On April 12, 2005, Florida Mowing brought a breach of contract action against Equity in the Circuit Court of Lee County, Florida, seeking damages in the amount of the unpaid invoices. The next day, Equity sued Florida Mowing in the United States District Court for the Middle District of Florida.⁴ Equity's complaint sought (1) a declaratory judgment that Florida Mowing had received all the money it was entitled to receive under the parties' contract and (2) damages for breach of contract, breach of implied covenant of good faith, and unjust enrichment. Equity removed Florida Mowing's action to the district court,⁵ and the two cases were consolidated.

Equity thereafter amended its complaint twice, with leave of court.⁶ Equity's second amended complaint, filed on October 19, 2005, once again asked the district court to declare that no funds were due and owing to Florida Mowing for several reasons, including that Florida Mowing had not provided Equity with the documents underlying its invoices,⁷ and that Florida Mowing failed to perform the contract in good faith and to provide Equity with adequate billing documentation showing the costs and expenses it incurred in performing the work.⁸ The second amended complaint also sought damages under Florida statutory and tort law.⁹

After the parties engaged in discovery, Equity moved the district court for summary judgment on several issues, one of which lies at the heart of this appeal. Equity asked the court to declare that the word "costs," the basis of the "cost plus" provision, referred to the funds Florida Mowing actually paid for labor and equipment in performing the cleanup work, and the 27% "markup" was multiplied by such payments. Equity contended that Florida Mowing's interpretation of "costs," that "costs" referred to the "unit" costs for labor and equipment, was untenable. The district court rejected Equity's interpretation of "costs," finding, instead, that "costs" clearly referred to prices the contract fixed for the large units, $4,600, and for the small and final cleanup units, $1,650. The court also rejected Equity's position that if "costs" referred to these unit costs, then Florida Mowing had the burden of proving at trial that such unit costs were reasonable.

The consolidated cases went to trial before a jury on May 23, 2006. On the third day of trial, in a bench conference, Equity's counsel raised what they considered to be a new affirmative defense to Florida Mowing's claim for breach of contract and, at the same time, a new breach of contract claim—that is, Florida Mowing had engaged in "price gouging," billing Equity for units, labor and equipment that were never used.¹⁰ Equity's counsel moved the court to grant a mistrial in both cases and for leave to file a third amended complaint.¹¹ The court granted the motion for a mistrial,¹² and ordered Equity to file a third amended complaint.

In doing so, the court gave instructed Equity's counsel as follows:

The Court is going to require you to file a third amended complaint setting forth, in detail, as you've done here, today, the precise breaches of contracts that you've articulated. When this case is retried, if you do not prove your case, the Court will impose sanctions on you, personally, as well as your client, if the Rule 11 standard is [not] satisfied.

To further emphasize the point, the court issued a written order stating that in drafting the third amended complaint, counsel must

include all the claims [Equity] wishes to pursue, including the "price gouging" portion of Count I . . . . If Equity Lifestyle includes a breach of contract claim, the claim shall specifically identify the breaches it alleges, consistent with those articulated to the Court during trial on May 25,...