Hatcher v. Roberts

• Decision Date: 20 August 1985
• Docket Number: AV-64,Nos. AV-63,s. AV-63
• Citation: 478 So.2d 1083,10 Fla. L. Weekly 2003
• Parties: 10 Fla. L. Weekly 2003, 10 Fla. L. Weekly 2567 Jimmy HATCHER, Appellant, v. B.K. ROBERTS, John S. Miller, Jr., et al., Appellees. RED CARPET CORPORATION OF PANAMA CITY BEACH, Appellant, v. B.K. ROBERTS, John S. Miller, Jr., et al., Appellees.
• Court: Florida District Court of Appeals

Page 1083

478 So.2d 1083

10 Fla. L. Weekly 2003, 10 Fla. L. Weekly 2567

Jimmy HATCHER, Appellant, v. B.K. ROBERTS, John S. Miller, Jr., et al., Appellees.

RED CARPET CORPORATION OF PANAMA CITY BEACH, Appellant, v. B.K. ROBERTS, John S. Miller, Jr., et al., Appellees.

Nos. AV-63, AV-64.

District Court of Appeal of Florida,

First District.

Aug. 20, 1985.

Rehearing Denied Nov. 20, 1985.

Rehearing Denied Dec. 23, 1985.

Jimmy Hatcher, pro se.

R. Vinson Barrett, Tallahassee, for appellant Red Carpet.

Jerome M. Novey and Robert D. Mendelson of Novey & Mendelson, Tallahassee, for appellees.

ZEHMER, Judge.

Appellant Red Carpet Corporation of Panama City Beach (Red Carpet) appeals a final summary judgment entered in favor of appellees in Red Carpet's legal malpractice action. In a related case, appellant Jimmy Hatcher appeals from the trial court's denial of his motion to intervene in the Red Carpet proceeding on the ground that his motion was untimely filed. The cases were consolidated on appeal, were heard together at oral argument, and are disposed of in this opinion.

Four issues are raised on appeal. With regard to the Red Carpet's appeal, the issues are as follows:

(1) Whether the trial court erred in granting appellees' motion for summary judgment by finding as a matter of law that appellee John S. Miller was not negligent in his representation of Red Carpet.

(2) Whether the trial court erred in granting appellees' motion for summary judgment by finding that Red Carpet's malicious prosecution count was barred by collateral estoppel and by no showing of lack of probable cause.

(3) Whether the trial court erred in granting appellees' motion for summary judgment by finding, as a matter of law, that John S. Miller's actions did not constitute an abuse of process and that this count was merely an attempt by Red Carpet to expand upon the malicious prosecution claim in count 2.

With regard to Jimmy Hatcher's appeal, the issue presented is whether the trial court abused its discretion in denying Hatcher's motion to intervene and participate in the hearing on the motion for summary judgment against Red Carpet. We affirm all points presented in both cases.

In July 1976 John S. Miller was retained by Red Carpet to represent it in chapter 11 bankruptcy proceedings. Part of Red Carpet's bankruptcy estate was 300 feet of beachfront property on Panama City Beach, formerly the site of a motel which was destroyed in a 1975 hurricane. The property was mortgaged, with annual payments of $28,000, and these payments were current when the motel was destroyed. The mortgage required the mortgagor to On or about March 4, 1976, before retaining Miller, Red Carpet delivered a check for $141,000 to the mortgagees of the beachfront property, representing the amount of insurance proceeds from destruction of the motel. The record contains no evidence of any instructions or agreements as to how the money was to be applied against the mortgage. The mortgagees chose to apply the proceeds to the end of the mortgage debt, i.e., reduce the balance of the mortgage note. As a result, when Red Carpet failed to make the next annual payment of $28,000 when due, the mortgagees declared the mortgagor in default and instituted foreclosure proceedings. Miller, having been retained by Red Carpet to defend the foreclosure, answered the complaint by alleging an affirmative defense that the $141,200 constituted prepayment of mortgage installments on the front end of the mortgage debt. Subsequently this affirmative defense was withdrawn by Miller as counsel for Red Carpet. Miller contends that the defense was withdrawn because of a number of factors, primarily the fact that Red Carpet, through its president and sole stockholder, Jimmy Hatcher, instructed him to withdraw the defense. Red Carpet takes the position that the prepayment defense was withdrawn by Miller solely upon Miller's independent and incorrect determination that the defense could not possibly succeed. In any event, no appearance was made by Miller at the foreclosure hearing, and a final judgment of foreclosure was entered on January 31, 1978.

maintain insurance on the property, but did not direct how any insurance proceeds received by the mortgagee were to be credited against the mortgage.

Subsequently, Jimmy Hatcher became dissatisfied with Miller's representation of Red Carpet and, on April 29, 1979, wrote Miller a letter accusing him of malpractice and threatening to sue him. On May 11, 1979, Miller filed an attorney's fee application with the bankruptcy court seeking $25,000 in fees for representing Hatcher personally in a personal chapter 11 bankruptcy proceeding filed by Hatcher. On May 29, 1979, Miller, as a creditor of both Hatcher personally and Red Carpet, filed "applications for adjudication" in bankruptcy court to adjudicate both Hatcher and Red Carpet bankrupt under chapter 7 because he believed as a creditor that the chapter 11 proceedings as to both Hatcher and Red Carpet could not succeed. Finally, in August 1979, Miller sued Hatcher and his wife personally for a $5,000 attorney's fee incurred in defending Hatcher's wife in another separate foreclosure proceeding. In this suit, the Hatchers counterclaimed for breach of contract and abuse of process, alleging that Miller's suit was merely filed in retaliation for Hatcher's threats to sue Miller for legal malpractice in the Red Carpet case. The court considered the Hatchers' counterclaim and, on December 21, 1979, entered final summary judgment against the Hatchers, stating there was no evidence that Miller's suit had been instituted "willfully without probable cause and with malice." This final summary judgment on Hatcher's counterclaim was affirmed on appeal without opinion. Hatcher v. Miller, 392 So.2d 70 (Fla. 1st DCA 1980).

As a result of the foreclosure of Red Carpet's beach property and the various bankruptcy pleadings filed by Miller against Red Carpet and Hatcher, Red Carpet sued Miller and his law firm in a three-count complaint filed September 29, 1981. Count 1 alleged that Miller was negligent in not presenting the prepayment defense to the foreclosure suit, which resulted in the loss of Red Carpet's property. Count 2 alleged that Miller's various filings in the bankruptcy proceedings constituted malicious prosecution designed to punish and discredit Red Carpet. Count 3 alleged that Miller's actions in the bankruptcy proceedings constituted abuse of process and that Miller was attempting to extort Red Carpet into not prosecuting a malpractice action against him.

Miller and his law firm moved on August 10, 1982, for partial summary judgment as to counts 2 and 3 of Red Carpet's complaint, urging a theory of collateral estoppel. They argued that Red Carpet was, in reality, the same entity as the Hatchers On April 21, 1983, Miller and the law firm filed a motion for summary judgment in this action as to count 1 and Miller personally filed a motion for summary judgment as to counts 2 and 3. The trial court granted the motions in their entirety. As to count 1, the court ruled that the prepayment defense to the foreclosure action would not have prevailed even if Miller had pursued it; therefore, Miller was entitled to judgment as a matter of law on the legal malpractice count. With respect to count 2, the court found that the doctrine of collateral estoppel applied since the issues had already been decided adversely to Hatcher in prior cases. Finally, with respect to count 3, the court found that as a matter of law there was no abuse of process by Miller and that this count was merely a restatement and expansion of count 2. Red Carpet has appealed this final summary judgment.

since Jimmy Hatcher was the president and sole stockholder of Red Carpet; that the issues of malicious prosecution and abuse of process were decided adversely to Hatcher in the August 1979 lawsuit which resulted in final summary judgment against the Hatchers' counterclaim; and that such decision should collaterally estop Red Carpet from raising the same issues. On December 17, 1982, the trial court granted the motion for summary judgment as to the law firm, but not as to Miller, finding that the issues raised had been settled adversely to Red Carpet in the prior Hatcher v. Miller suit. This trial court order was appealed and affirmed in Red Carpet Corp. v. Roberts, 443 So.2d 377 (Fla. 1st DCA 1984).

On July 26, 1983, one day before final arguments were heard on Miller's April 21 summary judgment motion, Hatcher, individually, moved to intervene in that hearing as an unsecured creditor of Red Carpet. The motion was denied by the trial court on the basis that the motion was untimely. Hatcher has appealed this order denying intervention.

Regarding Hatcher's appeal, we find no abuse of discretion by the trial court in denying Hatcher's motion to intervene in the hearing on the motion for summary judgment for the reason cited by the trial court.

With respect to issues 2 and 3 in Red Carpet's appeal, we find no error in the trial court's rulings. The reasons set forth by the trial court are legally sufficient to support summary judgment for appellees. We believe, however, that Red Carpet's first issue merits discussion.

In support of its legal malpractice claim in count 1, Red Carpet argues that appellees failed to carry their burden of proving that, under all the facts, circumstances, and law existing at the time of the foreclosure suit, the prepayment defense asserted and then withdrawn in the foreclosure proceeding could not possibly have succeeded, even with diligent preparation and litigation by Miller. Red Carpet maintains that the prepayment defense was viable and could have succeeded pursuant to the Florida Supreme Court's decision in Ott v. Bray, 114 Fla. 547, 154 So. 209 (1934). Red Carpet attempts to distinguish the various cases relied upon by appellees and the trial court in reaching the conclusion that the prepayment...