KITCHENS OF OCEANS, INC. v. McGladrey & Pullen, LLP
Citation | 832 So.2d 270 |
Decision Date | 11 December 2002 |
Docket Number | No. 4D01-3758.,4D01-3758. |
Parties | KITCHENS OF THE OCEANS, INC. and Albert F. Margus, Jr., Appellants, v. McGLADREY & PULLEN, LLP, an Iowa limited liability partnership, Michael A. Balter, an individual, and Salvatore Catanese, an individual, Appellees. |
Court | Court of Appeal of Florida (US) |
I. Jeffrey Pheterson and Peter H. Schmidt of Schmidt, Pheterson & Bleau, Boca Raton, for appellants.
Ronald B. Ravikoff and Thierry Olivier Desmet of Zuckerman Spaeder, LLP, Miami, and Robert R. Watson Sidley, Austin, Brown & Wood, Chicago, Illinois, for appellees.
This case involves a claim by a client against an accounting firm (auditors) for negligence in its audit of certain financial statements. The trial court granted the auditor's motion to dismiss the claim for failure to state a cause of action. We reverse.
The auditors first argued that the engagement agreement's hold harmless provision barred the client's claim for breach of contract. We disagree.
The engagement agreement provided that auditors would perform as follows:
The complaint accuses the auditors of negligence and breach of contract in planning and designing the audit for client's particular business and, thereby, failing to detect an ongoing embezzlement scheme by client's controller.
The hold harmless provision relied on by the auditors states:
Although there is a difference between contracts of indemnification and hold-harmless agreements, we deem the central holding of the above cases to apply as well to a hold harmless agreement that, as here, functions much like an indemnification agreement. As one court has explained:
O'Connell v. Walt Disney World Co., 413 So.2d 444, 446 (Fla. 5th DCA 1982); see, e.g., Van Tuyn v. Zurich Am. Ins. Co., 447 So.2d 318, 320 (Fla. 4th DCA 1984) ( ).
We therefore find that...
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