Mortellaro v. Caribe Health Ctr., Inc.

• Decision Date: 26 May 2021
• Docket Number: Case No. 2D19-4473
• Court: Florida District Court of Appeals
• Parties: Michael Anthony MORTELLARO, as the personal representative of the Estate of Gloria C. Cooper, a/k/a Gloria Gonzalez Cooper, deceased, Appellant, v. CARIBE HEALTH CENTER, INC., and Ana Dominguez, Appellees.

322 So.3d 128

Michael Anthony MORTELLARO, as the personal representative of the Estate of Gloria C. Cooper, a/k/a Gloria Gonzalez Cooper, deceased, Appellant,

v.CARIBE HEALTH CENTER, INC., and Ana Dominguez, Appellees.

Case No. 2D19-4473

District Court of Appeal of Florida, Second District.

Opinion filed May 26, 2021.

Rehearing Denied August 2, 2021

Raymond N. Seaford of Law Office of Raymond N. Seaford, P.A., Tampa, for Appellant.

Mark E. Pena of Law Office of Mark E. Pena, Tampa, for Appellees.

ROTHSTEIN-YOUAKIM, Judge.

Michael Anthony Mortellaro, as the personal representative of the Estate of Gloria C. Cooper,¹ appeals from a final order enforcing a settlement agreement in favor of Appellees, Caribe Health Center, Inc. (Caribe), and Caribe's president, Ana Dominguez. Because the trial court erred in concluding that Caribe's failure to abide by the time limitations set forth in the agreement did not constitute a material breach, we reverse and remand for further proceedings in execution of the Amended Final Judgment.

I. Background

Cooper originally sued Caribe for premises liability. On March 9, 2018, the parties entered into a settlement agreement. Pursuant to the agreement, the trial court entered a $500,000 Final Judgment in favor of Cooper and against Caribe, but the agreement also permitted Caribe to satisfy the Final Judgment in full for $100,000 "only if" it "timely made" thirteen monthly payments. The agreement included a specific payment schedule—with final payment due March 9, 2019—and further provided, in pertinent part:

4. Each payment shall be delivered on or before the 9th day of each month beginning on March 9, 2018, to an address designated by the Plaintiff. ...

5. If a monthly payment is late or does not clear, Plaintiff shall provide Defendant written notice via its registered agent, Ana Dominguez ... and current counsel. Defendant shall have 10 days to cure from the date the written notice is issued by the Plaintiff.

6. If no payment is received from the Defendant within the cure period, Plaintiff, at its option, can declare a default under this agreement and shall have the unfettered ability to seek full execution of the Final Judgment ... [with] all payments received to date being credited solely as payments against the full amount of the Final Judgment.

Caribe's first two monthly payments were three days late and two days late, respectively. In both instances, Caribe promised that the delayed payments were forthcoming, and Cooper refrained from sending the ten-day cure letter. When Caribe failed to make its third payment on May 9, 2018, however, Cooper sent the cure letter the following day. After receiving no payment or communication within the ten-day cure period, Cooper declared a default and moved to add Dominguez as a party to an Amended Final Judgment. Caribe and Dominguez stipulated to entry of the Amended Final Judgment,² and Cooper agreed to reinstate the settlement agreement and to accept a late May payment pursuant to the agreement.

Caribe's fourth monthly payment was due June 9, 2018. Caribe once again failed to make this payment. On June 11, 2018, Cooper sent a ten-day cure letter but again received no payment or communication within the cure period.

On June 22, 2018, Cooper sent Caribe's counsel a letter warning: "Before taking action to fully enforce the final judgment, I am contacting you to determine if your client has decided to no longer make any payments towards the amount which was agreed to in the Settlement Agreement." Counsel responded that his clients "seem[ed] to have 'forgotten' the deadlines" and said that he would contact them. On June 27, 2018, consistent with paragraph six of the settlement agreement, Cooper notified Caribe:

The prior Settlement Agreement, having been breached, is no longer in effect. The limitations imposed by the Settlement Agreement on collecting the full amount owed under the Final Judgment and the Amended Final Judgment are no longer in effect. All past and future payments will be credited against the principal owed on the Amended Final Judgment, then, once the principal has been recovered, the remaining payments will be credited against interest, until the Amended Final Judgment is fully satisfied.

The letter stated further:

If your clients wish to propose a new settlement agreement and payment plan for paying less than the full amount of the Amended Final Judgment, please provide me with the same. In order for any new payment plan to be accepted, all financial discovery will have to first be completed and collateral will have to be identified and secured.

That same day, Cooper received a $10,000 payment and an email from Caribe's counsel simply asking, "Can [I] not respond to the discovery requests?"

Over the next several months, Caribe continued to make payments at more or less monthly intervals, until a total of $90,000 had been paid.³ During this time, Caribe neither argued that the settlement agreement remained in effect nor conditioned payment upon reinstatement of the agreement. Likewise, Cooper did not offer to reinstate the agreement in exchange for any of the payments. To the contrary, all of the receipts that Cooper provided to Caribe indicated that the payment had been received "in partial satisfaction of the Amended Final Judgment."

On December 4, 2018, Caribe's counsel sent an email to Cooper's counsel that said, "TODAY I RECEIVED THE FINAL PAYMENT OF 10K. I WILL DEPOSIT THE SAME TODAY OR TOMORROW AND SEND IT OVER WHEN IT CLEARS. I WOULD HOPE TO HAVE THE RELEASE FROM JUDGEMENT/DISMISSAL SHORTLY AFTER." Cooper's counsel responded with a multipage letter rejecting the tender of the "final payment" and recounting Caribe's default and material breach and Cooper's uncontested notices to Caribe that all payments had been credited against the Amended Final Judgment. On December 6, 2018, Caribe sent Cooper an eCheck bearing the notation, "Caribe Payment 10 (PIF) full and final payment." Cooper did not negotiate the check.

Thereafter, Caribe filed a motion to enforce the settlement agreement, which Cooper opposed. At the hearing on the motion,⁴ Caribe argued that Cooper had waived the June 2018 default by accepting late payments after the default occurred; alternatively, Caribe's late payments should be excused based on the parties' "course of dealing" and the fact that Caribe had tendered the final payment early. Agreeing with Caribe, the trial court stated at the hearing:

The Court is going to grant the motion to enforce the settlement agreement. The basis of the ruling is that the failure to pay on the June [9, 2018,] payment, ... was not a material breach of the contract, given the later payments, including June 27th, August 10, and the following payments.

Additionally, the court's written order provided:

The court finds that the Plaintiff accepted late payments from the inception of the agreement pay-out. The court further finds therefore, that, in this context, the tardiness of the June payment was not a material breach of the Settlement Agreement.

II. Analysis

We review de novo the trial court's interpretation of the parties' settlement agreement. Marlin Yacht Mfg., Inc. v. Nichols, 254 So. 3d 1022, 1024 (Fla. 4th DCA 2018) ("[S]ettlement agreements are interpreted like a contract and reviewed de novo." (citing Barone v. Rogers, 930 So. 2d 761, 764 (Fla. 4th DCA 2006) )). And we start, as always, with the language of the agreement itself. See Kozel v. Kozel, 302 So. 3d 939, 948 (Fla. 2d DCA 2019) ("Because we interpret a settlement agreement in a dissolution proceeding the same way we interpret any other contract, we use the standard rules of contract interpretation to do this work. That means that we look first to the ordinary meaning of the language of the contract and, where that language is unambiguous, we will ordinarily construe the contract as the parties wrote it." (first citing Rector v. Rector, 264 So. 3d 282, 286 (Fla. 2d DCA 2019) ; and then citing Murley v. Wiedamann, 25 So. 3d 27, 29–30 (Fla. 2d DCA 2009) )).

In this case, the agreement indicated that Cooper "agree[d] to accept [the] sum of $100,000 in full satisfaction of the Final Judgment only if ... payments are timely made " and mandated that "[e]ach payment shall be delivered on or before the 9th day of each month." (emphasis added). It provided that if a payment was not received within the ten-day cure period, Cooper could declare a default at her option and had "the unfettered ability to seek full execution of the Final Judgment" as her remedy. In light of this express language, we readily conclude that Caribe's failure to abide by the time limitations for payment constituted a material breach of the agreement. See Treasure Coast, Inc. v. Ludlum Constr. Co., 760 So. 2d 232, 234–35 (Fla. 4th DCA 2000) ("[T]he trial court erred in failing to enforce the unambiguous terms of the settlement agreement, ... [which] clearly contained the express provision for payment of a sum certain on a specific date. In providing appellant with a specific remedy, judgment for the entire amount due and owing in the event of nonpayment, the parties essentially agreed that time was of the essence."); see also Atlanta Jet v. Liberty Aircraft Servs., LLC, 866 So. 2d 148, 150 (Fla. 4th DCA 2004) (defining material breach and stating that before failure to perform by a specific time can constitute a material breach, "it is necessary to conclude that time was of the essence"); Sublime, Inc. v. Boardman's Inc., 849 So. 2d 470, 471 (Fla. 4th DCA 2003) ("As a general rule, time is considered to be of the essence where ... notice has been given to the...