Fridman v. Citicorp Real Estate, Inc., 91-01157
| Decision Date | 13 March 1992 |
| Docket Number | No. 91-01157,91-01157 |
| Citation | 596 So.2d 1128 |
| Parties | Sylvia Y. FRIDMAN, Appellant, v. CITICORP REAL ESTATE, INC., Appellee. 596 So.2d 1128, 17 Fla. L. Week. D710 |
| Court | Florida District Court of Appeals |
Paul A. Louis, Frank Nussbaum and John Zavertnik of Sinclair, Louis, Siegel, Heath, Nussbaum & Zavertnik, P.A., Miami, for appellant.
Bruce J. Berman, P.A., and Jamie A. Cole of Weil, Gotshal & Manges, Miami, for appellee.
Sylvia Y. Fridman appeals an order vacating an arbitration award. We reverse the order because it was error for the circuit court to enter such an order without directing a rehearing.
Fridman filed a mortgage foreclosure action in which Citicorp, a junior mortgagee, chose to pay off the notes which the senior mortgage secured and to pay counsel fees to two law firms. Citicorp, however, objected to paying the $10,043.95 fee to the firm of Sinclair, Louis, Siegel, Heath, Nussbaum & Zavertnik, P.A. (hereinafter Sinclair, Louis) which represented Fridman. The parties agreed to submit the matter of Sinclair, Louis's fees to binding arbitration. The majority of the arbitration panel, which consisted of three attorneys appointed through the arbitration procedures of the Dade County Bar Association, recommended that Fridman was entitled to $13,915 for Sinclair, Louis's fees, which included fees for time spent on the arbitration proceeding. Fridman filed a motion to confirm the arbitration award, and Citicorp filed a motion to vacate the award. The circuit court entered an order vacating the arbitration award on the ground that the arbitrators exceeded their powers by including in the award an amount of fees incurred in the conduct of arbitration.
The first issue is whether the circuit court erred in vacating the arbitration award on the basis that the arbitration panel exceeded its authority. This analysis necessarily must begin with the case of Fewox v. McMerit Construction Company, 556 So.2d 419 (Fla. 2d DCA 1989) (en banc), approved sub nom. Insurance Company of North America v. Acousti Engineering Company of Florida, 579 So.2d 77 (Fla.1991). Fewox held that a party may be awarded fees for arbitration proceedings if authorized by statute or contract; however, the circuit court and not the arbitrators must determine the fee. We, therefore, conclude that the arbitrators erred in awarding fees for work performed in preparation for and during the arbitration proceedings.
This court, in Fewox, noted that "[t]he legislature apparently eliminated attorney's fees from the subject matter jurisdiction of arbitration because arbitrators are generally businessmen chosen for their expertise in the particular subject matter of the suit and have no expertise in determining what is a reasonable attorney's fees." Fewox, 556 So.2d at 421-22. We recognize that this rationale does not apply to the instant case because the subject matter of the arbitration proceedings was the determination of reasonable attorney's fees and the three attorneys apparently had some degree of expertise in this area. We, however, believe that the language of section 682.11, Florida Statutes (1989) and this court's holding in Fewox regarding the limited subject matter jurisdiction of the arbitration prevent us from carving out an exception for this factual situation, even though such an exception here would appear reasonable.
Having determined that the circuit court was correct in holding that the arbitrators exceeded their authority in awarding fees for the arbitration, the next inquiry is what the circuit court should have done following that finding. It is error for a circuit court to enter an order vacating an arbitration award without directing a rehearing. Ripple v. Packard, 471 So.2d 1293 ...
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