Grip Development, Inc. v. Coldwell Banker Residential Real Estate, Inc.

• Decision Date: 20 September 2000
• Docket Number: No. 4D99-3509., No. 4D99-1513
• Citation: 788 So.2d 262
• Parties: GRIP DEVELOPMENT, INC., Appellant, v. COLDWELL BANKER RESIDENTIAL REAL ESTATE, INC., Appellee.
• Court: Florida District Court of Appeals

788 So.2d 262

GRIP DEVELOPMENT, INC., Appellant, v. COLDWELL BANKER RESIDENTIAL REAL ESTATE, INC., Appellee.

Nos. 4D99-1513, 4D99-3509.

District Court of Appeal of Florida, Fourth District.

September 20, 2000.

Jeffrey J. Pardo, Burlington, Connecticut, for appellant.

Stephen N. Lipton and Edward J. O'Sheehan of Shutts & Bowen LLP, Fort Lauderdale, for appellee.

ON MOTION FOR REHEARING AND CLARIFICATION

POLEN, J.

Coldwell Banker Residential Real Estate, Inc. filed a motion for rehearing, motion for rehearing en banc, and motion to certify conflict. We grant rehearing in part, withdraw our original opinion, and substitute the following. We deny the motions in all other respects.

In case number 4D99-1513, Grip Development, Inc. ("Grip") appeals after the court denied its motion for new trial on damages awarded to its broker, Coldwell Banker Residential Real Estate, Inc. ("Coldwell Banker"). Grip argues that the jury's quantum meruit verdict exceeded the amount claimed under the brokerage contract, and that the Brokerage Relationship Disclosure Act precludes such a recovery as a matter of public policy. In case number 99-3509, Grip argues that the award of attorney's fees to Coldwell Banker should be reversed because Coldwell Banker's proposal for settlement was invalid. On this court's own motion, we consolidated both appeals. We affirm the denial of Grip's motion for new trial without comment but reverse the attorney's fees and costs awarded to Coldwell Banker as a result of its untimely proposal for settlement.

On June 3, 1998, Coldwell Banker sued Grip seeking a broker's commission. It is undisputed that it served its complaint on Grip on June 8, 1998. On Friday, September 4, 1998, 87 days after it served the complaint, it served a proposal for settlement upon Grip. The total amount of proposal was $12,569.96, and provided that Grip would have to file written acceptance within thirty days after service of same if it wanted to accept its terms. Grip did not respond to the proposal.

Coldwell Banker prevailed at trial, and the jury awarded it $18,000. The court then entered final judgment for this amount in Coldwell Banker's favor.

Grip moved for a new trial. While his motion was pending, Coldwell Banker moved for attorney's fees pursuant to section 768.79, Florida Statutes (1997) and Florida Rule of Civil Procedure 1.442. The court denied Grip's motion, but granted Coldwell's motion as to entitlement to fees. Thereafter, the court awarded Coldwell Banker $74,705.00 in fees and $4,639.27 in costs, for a total of $79,344.27. Of the $4,639.27 in costs, the record reflects that $3,463.27 had been awarded to Coldwell Banker as the prevailing party of the underlying action pursuant to section 57.041, Florida Statutes (1997); the remaining costs were awarded as a result of Coldwell Banker's attorney's fee litigation. This appeal followed.

Grip argues that because Coldwell Banker's proposal of judgment was served prematurely, the court should not have awarded it fees under section 768.79 and rule 1.442. It maintains that the time requirements of both these provisions must be strictly construed. Coldwell Banker concedes its proposal was served before the expiration of 90 days, but argues that a distinction should be made between offers served too early and those served too late. It concludes that offers served too early should be considered valid if they otherwise substantially comply with the requirements of section 768.79 and rule 1.442.

Section 768.79 provides in pertinent part as follows:

(1) In any civil action for damages filed in the courts of this state, if a defendant files an offer of judgment which is not accepted by the plaintiff within 30 days, the defendant shall be entitled to recover reasonable costs and attorney's fees incurred by him ... if the judgment is one of no liability or the judgment obtained by the plaintiff is at least 25 percent less than such offer....

§ 768.79(1), Fla. Stat. (1997)(emphasis supplied). In Schmidt v. Fortner, 629 So.2d 1036 (Fla. 4th DCA 1993), we concluded that in enacting section 768.79, the legislature created a mandatory right to attorney's fees if the statutory prerequisites have been met. In reaching this conclusion, we emphasized that the statute contains the words "shall be entitled...." We held that this language

cannot possibly have any meaning other than to create a right to attorney's fees when the two preceding prerequisites have been fulfilled: i.e., (1) when a party has served a demand or offer for judgment, and (2) that party has recovered a judgment at least 25 percent more or less than the demand or offer. These are the only elements of the statutory entitlement. No other factor is relevant in determining the question of entitlement.

Id. at 1040. We also noted that, under this statute, the legislature gave judges discretion only to determine whether the qualifying offer was made in good faith, and whether the amount of fees awarded was reasonable. Id. at 1041.

Section 768.79 does not specify when such offers may be served. This is so because the timing requirements of the statute are merely procedural in nature. Timmons v. Combs, 608 So.2d 1 (Fla.1992). Under the Florida Constitution, only the supreme court has the prerogative to promulgate rules for the procedural aspects of civil litigation through the Florida Rules of Civil Procedure. Fla. Const. art. V, § 2(a).

As such, the supreme court in Timmons adopted the procedural portion of section 768.79 as a rule of court. This rule— Florida Rule of Civil Procedure 1.442— provides, in relevant part,

A proposal to a defendant shall be served no earlier than 90 days after service of process on that defendant; a proposal to a plaintiff shall be served no earlier than 90 days after the action has been commenced. No proposal shall be served later than 45 days before the date set for trial or the first day of the docket on which the case is set for trial, whichever is earlier.

Fla. R. Civ. P. 1.442(b)(emphasis supplied).

To paraphrase from our opinion in Fortner, the words "shall be served" that appear in this rule cannot possibly have any meaning other than setting a mandatory time frame for service of such offers. In fact, we held in our recent case of Schussel v. Ladd Hairdressers, Inc., 736 So.2d 776 (Fla. 4th DCA 1999) that section 768.79 and rule 1.442 are punitive¹ provisions which must be strictly construed. Id. at 778. In that case, Ladd's offer was served on Schussel within 45 days of the first day of the docket on which the case was initially set for trial and, thus, was untimely. Arguably, the fact the offer was untimely did not prejudice Schussel because discovery was complete; there was no date certain for the trial to commence; and trial did not actually take place until over six months later. Nevertheless, we held the offer was still void ab initio. We explained,

Since section 768.79 and Florida Rule of Civil Procedure 1.442 are punitive in nature in that they impose sanctions upon the losing party and are in derogation of the common law, they must be strictly construed. See TGI Friday's, Inc. v. Dvorak, 663 So.2d 606, 614 (Fla. 1995); Loy v. Leone, 546 So.2d 1187, 1189 (Fla. 5th DCA 1989). Nothing in the record reflects that Ladd was prevented from making an offer of judgment much earlier in the case, even prior to the case being set for the docket of August 18, 1997, or from making an offer of judgment after having obtained the continuance. The offer of judgment was untimely and thus unenforceable.

Id.

As Schussel suggests, prejudice or lack thereof should not be a topic for judicial inquiry in determining the applicability of section 768.79 and rule 1.442 (outside the "good faith" concept). Simply put, either the offer (or demand) complies with the rule and statute, or it does not.

Moreover, Schussel supports that under rule 1.442 there is no difference between offers that are served prematurely and those that are served too late. Coldwell Banker, however, would have us believe that such a distinction should be made. At oral argument, it maintained that offerees of premature offers may take advantage of Florida Rule of Civil Procedure 1.090(b), which gives the courts discretion to enlarge the time for acting as specified by the rules when a request is made prior to the expiration of the original time. It argued that as trial approaches, the courts lack the same degree of discretion to enlarge the time to respond to late filed offers.

Coldwell Banker's argument is flawed. Because rule 1.442 mandates that the offers be served no earlier than 90 days after service of process on the defendant, there is simply no time period to enlarge. Neither rule 1.442 nor rule 1.090(b) permits the courts to ignore the 90-day time bar for service of offers. See Fla. R. Civ. P. 1.442(a)(stating rule 1.442 "supersedes all other provisions of the rules and statutes that may be inconsistent with this rule"); Spencer v. Barrow, 752 So.2d 135 (Fla. 2d DCA 2000)("Inadvertence or mistake of counsel or ignorance of the rules does not constitute excusable neglect.") (citations omitted).

In any event, Coldwell Banker never made a motion under rule 1.090(b) for any "enlargement" of time to serve the offer. Thus, if we applied rule 1.090(b) as per its interpretation, we would be reading into the rule a requirement that the recipient of a premature proposal must notify the offeror that it filed the proposal too soon. Nothing in any of the rules or statutes support such a conclusion and, in fact, the cases suggest that the party seeking the attorney's fees has the burden to show compliance with the rules. See Gulliver Academy, Inc. v. Bodek, 694 So.2d 675, 677 (Fla.1997)(holding absent reservation of jurisdiction in final judgment, party seeking attorney's fees under section 768.79(6)(a) must show excusable neglect under rule 1.090(b)(2) to enlarge the time for filing a late motion).

Nevertheless,...