Kozel v. Kozel

• Decision Date: 27 November 2019
• Docket Number: Case No. 2D15-4364
• Citation: 302 So.3d 939
• Parties: Todd KOZEL, Appellant, v. Ashley D. KOZEL, Appellee.
• Court: Florida District Court of Appeals

302 So.3d 939

Todd KOZEL, Appellant,

v.Ashley D. KOZEL, Appellee.

Case No. 2D15-4364

District Court of Appeal of Florida, Second District.

Opinion filed November 27, 2019

Christopher N. Bellows and Rodolfo Sorondo, Jr., of Holland & Knight LLP, Miami (withdrew after briefing); John G. Crabtree, Charles M. Auslander, and Brian C. Tackenberg of Crabtree & Auslander, Key Biscayne (substituted as counsel of record); and Raoul G. Cantero and Jesse L. Green of White & Case, LLP, Miami, for Appellant.

Steven L. Brannock, Philip J. Padovano, and Joseph T. Eagleton of Brannock & Humphries, Tampa; and Jeffrey D. Fisher and Zachary Potter of Fisher Potter Hodas, PLLC, West Palm Beach, for Appellee.

SALARIO, Judge.

This case presents difficult questions about a trial court's continuing jurisdiction after entry of a final judgment to enforce a settlement agreement. Todd Kozel, the former husband, and Ashley Kozel, the former wife, entered into a property settlement agreement to resolve a divorce case. The former husband agreed to transfer shares of stock to the former wife by a date certain and to give her information to determine her tax obligations when she sold it. The family court incorporated the agreement into a final judgment of dissolution of marriage and retained jurisdiction to enforce it. The former husband was late in delivering the stock to the former wife, and the tax information he gave her was wrong.

Invoking the trial court's continuing jurisdiction to enforce the agreement, the former wife filed papers seeking relief from the family court. Although her filings were styled as petitions to enforce the agreement, they alleged what amounted to claims for money damages for alleged breaches of contract. After granting partial summary judgment on liability and holding a nonjury trial on damages, the family court found the former husband in breach and awarded the former wife (1) $34,611,702 as damages based on the failure to deliver the stock on time and (2) $3,850,500 as damages for the breach of the obligation to provide tax information. The sum and substance on appeal is this: A trial court's continuing jurisdiction to enforce a settlement agreement generally does not include jurisdiction to award damages for breach that are not specified in the agreement, and the agreement here did not specify the damages the former wife sought and the family court awarded. We reverse the family court's award of damages to the former wife—together with an injunction intended to secure the payment of those amounts—and affirm the balance of the final judgment.

The History and Relevant Terms of the Property Settlement Agreement

The former husband and former wife were married in 1992, and the former wife filed a petition for dissolution of marriage in 2010. The former husband is the chief executive officer of Gulf Keystone Petroleum, Ltd., an oil and gas exploration company. When the parties divorced, much of their shared and substantial wealth consisted of Gulf Keystone stock, which is publicly traded on the AIM Stock Exchange in London.

The parties settled the divorce case. A substantial chunk of the consideration was to consist of Gulf Keystone stock that the former husband was to transfer to the former wife as equitable distribution. The parties—both savvy people in their own rights and both represented by capable counsel—documented their understanding in a Property Settlement Agreement (PSA) dated January 12, 2012.

The former husband's obligation to transfer the Gulf Keystone stock to the former wife was regulated, in the main, by paragraphs 6 and 7 of the agreement. Paragraph 6A obligated the former husband to deliver to the former wife, as equitable distribution, twenty-three million shares of stock on or before January 27, 2012. Upon delivery, the former wife would be free to sell the stock to anyone at any time.

Paragraph 7 of the agreement, titled "Remedies Upon Default," spelled out what would happen if the former husband failed to deliver the shares. As relevant here, paragraph 7A provided as follows:

In the event that the Husband does not transfer to the Wife all or any portion of the 23 million shares of GKP common stock and/or the shares are transferred, but are not in full compliance with Paragraph 6A above ... then for each day, starting on [January 28, 2012], that the Husband has not fully and completely satisfied all of the terms and conditions of Paragraph 6A, he shall be in default and he shall owe the Wife payments as and for additional equitable distribution at the rate of 6% per annum (calculated simply and not compounding) on the value of the 23 million Shares, or any portion thereof as determined from time to time, which are not transferred in compliance with Paragraph 6A above ....

(Emphasis added.) Paragraph 7A calls the interest payments the former husband would be required to make in the event he failed to deliver the shares "Additional Equitable Distribution," and it says that the former husband's obligation to make additional equitable distribution payments if and when required is immediately "enforceable by contempt and any other remedy at law or in equity."

Paragraph 7A then goes on to state:

In addition, should Husband fail to fully comply with paragraph 6A above with regard to all 23 million Shares on or before the close of business 5:00 p.m. EST on May 1, 2012, but he has timely paid the Additional Equitable Distribution payments described herein, then on May 1, 2012, the Wife may move the court to hold the Husband in contempt or to otherwise compel him to specifically perform and/or transfer to her all 23 million Shares in compliance with paragraph 6A, or for any other remedy at law or in equity including, but not limited to, a money judgment. Nothing contained in this Agreement, or paragraph 7 thereof, shall be construed to limit or restrict the Wife's right to seek or pursue all remedies at law and in equity to enforce her rights to receive the 23 million Shares and/or the value thereof in accordance with paragraph 6A.

(Emphasis added.) In sum, then, paragraph 7A said that in the event of a default on the former husband's obligation to deliver the shares: (1) that the former husband would be required to pay additional equitable distribution, an obligation the former wife could immediately enforce using contempt or any other remedy; (2) that if the former husband paid the additional equitable distribution but failed to deliver the shares by close of business on May 1, 2012, the former wife could file a motion in the family court for contempt or for legal and equitable remedies, including a money judgment; and (3) that nothing in paragraph 7 of the agreement limited or restricted the former wife's right to seek any legal or equitable remedies for the former husband's failure to deliver the stock as required.

Also relevant with respect to the payment of additional equitable distribution, paragraph 7B of the agreement provided that the former husband

shall be entitled to a full or partial refund of those ... payments if, and only if, he (1) timely pays the Additional Equitable Distribution payments and (ii) cures the [stock delivery] default within 120 days from the date the default occurred, and (iii) on the date the default is cured, the price of the GKP Shares in default exceeds the price of the GKP Shares on [January 28, 2012] ....

(Emphasis added.)

Paragraph 15 of the PSA also addressed various tax matters arising from the dissolution of the parties' marriage and the transactions contemplated by their agreement.

To enable the former wife to determine and satisfy her tax obligations with respect to any sale of the Gulf Keystone stock she was to receive, paragraph 15 obligated the former husband to provide the former wife with a document "setting forth the [former husband's] tax basis and the holding period (as of the date of the transfer to the wife)" of the stock he was delivering "as well as documentation establishing such tax basis and holding period sufficient to allow the Wife to properly report any gains or losses" to the Internal Revenue Service.

Finally, as relevant here, the PSA contains some general provisions concerning remedies. Paragraph 20 says that the agreement would be incorporated into a final judgment to be entered by the family court and would be "fully enforceable as an order and/or Final Judgment of the court." It further provided:

Notwithstanding incorporation in the Final Judgment of Divorce, this Agreement shall not be merged in it, but shall survive the Final Judgment and shall be binding on the Parties for all time. The Parties agree that so long as one of them continues to reside in the State of Florida, the courts of the State of Florida shall retain jurisdiction for purposes of enforcing this Agreement and that venue will lie in the county where the Florida resident then resides.... Each party has the right to enforce and/or defend this Agreement utilizing all legal and/or equitable remedies including, but not limited to, contract remedies, judgment remedies, and all other remedies at law or in equity.

The parties presented the agreement to the family court, which entered a final judgment of dissolution of marriage. The final judgment ordered the parties to comply with the terms of the agreement and provided that the family court "retains jurisdiction over the subject matter of this cause ... to enforce this Final Judgment ... and to grant such other relief as is appropriate."

The Former Wife Seeks Relief for Alleged Breaches of the PSA in the Family Court

The former husband did not deliver twenty-three-million shares of Gulf Keystone stock to the former wife by January 27, 2012. Instead, he transferred the stock to her in four batches at later dates: (1) 2,034,447 shares on January 30, 2012; (2) 3,798,886 shares on February 3, 2012; (3) 5,666,667 shares on February 21, 2012; and (4) 11,600,000 shares on March 1, 2012. While the former husband was in default for failure to...