K.R. Exch. Serv., Inc. v. Fuerst, Humphrey, Ittleman, PL

• Decision Date: 16 December 2010
• Docket Number: No. 3D09-1733.,3D09-1733.
• Citation: 48 So.3d 889
• Parties: K.R. EXCHANGE SERVICES, INC., a foreign corporation, Appellant, v. FUERST, HUMPHREY, ITTLEMAN, PL, et al., Appellees.
• Court: Florida District Court of Appeals

48 So.3d 889

K.R. EXCHANGE SERVICES, INC., a foreign corporation, Appellant,
v.
FUERST, HUMPHREY, ITTLEMAN, PL, et al., Appellees.

No. 3D09-1733.

District Court of Appeal of Florida,
Third District.

Oct. 20, 2010.
Rehearing Denied Dec. 16, 2010.

48 So.3d 891

Louis C. Arslanian, Hollywood, for appellant.

Cole Scott & Kissane and Scott A. Cole and Alejandro Perez, Miami, for appellees Fuerst, Humphrey, Ittleman, PL, and Andrew Ittleman.

Before WELLS, ROTHENBERG, and LAGOA, JJ.

LAGOA, J.

K.R. Exchange Services, Inc. ("K.R.-Israel") appeals a final judgment dismissing with prejudice its legal malpractice claim against the law firm Fuerst, Humphrey, Ittleman ["FHI"] and attorney Andrew Ittleman. We affirm the trial court's dismissal of the complaint, however, we reverse the order to the extent it dismisses the complaint with prejudice.

I. FACTUAL AND PROCEDURAL HISTORY

K.R.-Israel, an Israeli corporation, and K.R. Services USA, LLC ("K.R.-USA"), a Florida corporation, were engaged in a money services business relationship. ¹ K.R.-USA is a consultant for K.R.-Israel. In order to cash its checks, K.R-Israel deposited the checks in K.R.-USA's account at Regions Bank. For this service, K.R.-Israel paid a commission to K.R.-USA.

This business relationship was interrupted when Regions Bank informed K.R.-USA that it would no longer accept checks from K.R.-Israel. As a result, K.R.-Israel was required to outsource this service; K.R.-USA no longer received commissions, and K.R.-Israel paid significantly higher fees to third parties in order to process the checks.

48 So.3d 892

In an effort to resolve this problem for both companies, Michael Elmaleh, K.R.-USA's president, individually, and on behalf of K.R.-USA, retained FHI. The engagement letter/retainer agreement stated that the nature of the legal service is for "a written opinion concerning whether your business-KR Services USA-is required to register in the state of Florida as a money transmitting business, check cashing service, or other similarly regulated entity. We will also advise you on how to most effectively restructure and reorganize your various entities so as to create stronger relationships with banking institutions and regulatory authorities worldwide." Ittleman provided the legal services for FHI under the agreement.

When the legal representation proved unsatisfactory, K.R.-Israel and K.R.-USA attempted to file a single legal malpractice action against FHI and Ittleman. ² In addition to the above-noted allegations, the complaint alleges that K.R.-Israel was an intended third-party beneficiary of FHI's and Ittleman's legal services to K.R.-USA, that FHI and Ittleman breached their duties to K.R.-Israel in their efforts to solve the business difficulties that ensued when Regions Bank would no longer accept deposits from K.R.-Israel, and that as a result, plaintiffs suffered monetary damages. The engagement letter/retainer agreement was attached to the complaint as an exhibit.

FHI and Ittleman sought dismissal of the claim, arguing that K.R.-Israel and K.R.-USA failed to state a cause of action for legal malpractice and that K.R.-Israel lacked standing because it was not an intended third-party beneficiary to the retainer agreement. Following a hearing, the trial court granted FHI's and Ittleman's motion and dismissed K.R.-Israel's complaint with prejudice.³ The order of dismissal does not indicate the ground upon which the trial court based its ruling. This appeal ensued.⁴

II. ANALYSIS

To assert a legal malpractice action, a plaintiff must allege the following three elements: "1) the attorney's employment; 2) the attorney's neglect of a reasonable duty; and 3) the attorney's negligence as the proximate cause of loss to the client." Law Office of David J. Stern, P.A. v. Sec. Nat'l Servicing Corp., 969 So.2d 962, 966 (Fla.2007) (quoting Sec. Nat'l Servicing Corp., v. Law Office of David J. Stern, P.A., 916 So.2d 934, 936 (Fla. 4th DCA 2006)); Sure Snap Corp. v. Baena, 705 So.2d 46, 48-49 (Fla. 3d DCA 1997); Maillard v. Dowdell, 528 So.2d 512, 514 (Fla. 3d DCA 1988). To withstand dismissal, however, a plaintiff must allege more than the "naked legal conclusion" that the law firm and attorneys have negligently rendered legal services.

48 So.3d 893

Rios v. McDermott, Will & Emery, 613 So.2d 544 (Fla. 3d DCA 1993) (quoting Arky, Freed, Stearns, Watson, Greer, Weaver & Harris v. Bowmar Instrument Corp., 527 So.2d 211, 212 (Fla. 3d DCA 1987), disapproved on other grounds, 537 So.2d 561 (Fla.1988)); see also Bankers Trust Realty, Inc. v. Kluger, 672 So.2d 897, 898 (Fla. 3d DCA 1996). "Florida's pleading rule [1.110(b)(2) ] forces counsel to recognize the elements of their cause of action and determine whether they have or can develop the facts necessary to support it, which avoids a great deal of wasted expense to the litigants and unnecessary judicial effort." Horowitz v. Laske, 855 So.2d 169, 172-73 (Fla. 5th DCA 2003); see also Arky, Freed, 537 So.2d at 563 (concluding that "litigants at the outset of a suit must be compelled to state their pleadings with sufficient particularity for a defense to be prepared"). Applying these principles, we agree with the trial court and hold that the complaint does not properly state a cause of action for legal malpractice against FHI and Ittleman.

A. Failure to Comply With Minimum Pleading Requirement

At the outset, we note that K.R.-Israel has failed to comply with Florida Rule of Civil Procedure 1.110. A party should plead each distinct claim in a separate count, rather than plead the various claims against all of the defendants together.⁵ See Fla. R. Civ. P. 1.110(f); Pratus v. City of Naples, 807 So.2d 795, 797 (Fla. 2d DCA 2002); see also Aspsoft, Inc. v. WebClay, 983 So.2d 761, 768 (Fla. 5th DCA 2008) (holding that plaintiff's complaint set forth defective claims by "impermissibly comingling separate and distinct claims" in a single count); Dubus v. McArthur, 682 So.2d 1246, 1247 (Fla. 1st DCA 1996) (stating that the "task of the trial court was made more difficult because the appellants' amended complaint improperly attempts to state in a single count separate causes of action"). In so doing, the plaintiff also must comply with Florida Rule of Civil Procedure 1.110(b)(2), which requires that the complaint contain "a...