Neiman v. Galloway

• Decision Date: 21 January 1998
• Docket Number: No. 96-3923,96-3923
• Citation: 704 So.2d 1131
• Parties: 23 Fla. L. Weekly D274 Brian NEIMAN, Appellant, v. Kevin GALLOWAY, et al., Appellees.
• Court: Florida District Court of Appeals

Page 1131

704 So.2d 1131

23 Fla. L. Weekly D274

Brian NEIMAN, Appellant, v. Kevin GALLOWAY, et al., Appellees.

No. 96-3923.

District Court of Appeal of Florida Fourth District.

Jan. 21, 1998.

H. Dohn Williams, Jr., P.A., Fort Lauderdale, for appellant.

No brief filed on behalf of appellees.

WARNER, Judge.

The trial court sua sponte granted a judgment for the appellees in this suit on a promissory note, finding that the contract between the parties was unconscionable and against public policy. We reverse, holding that unconscionability is an affirmative defense which must be raised by proper pleading and that the facts before the trial court did not show that this contract was against public policy.

The parties were involved with each other in connection with an insurance fraud investigation by the Broward State Attorney's office. One of the appellees, Kevin Galloway, had claimed insurance benefits as the result of an accident, and the appellant, Brian Neiman, helped him file his claim. As a result of the insurance company's claims of fraud, the state attorney's office called both Galloway and Neiman in for questioning.

Later, another individual, Hammell, and Galloway were charged with staging the accident from which the insurance claim was made. Neiman and Galloway then jointly hired an attorney, and Neiman loaned Galloway the funds to pay his portion of the fee. Galloway and his wife, the other appellee, executed a note to Neiman for the amount.

Galloway subsequently entered a plea of nolo contendere and was placed on probation. Hammell was convicted and sentenced to five years imprisonment. Galloway's wife was also charged in the incident, and entered into a plea agreement in which she agreed to testify against Neiman. Neiman was charged several years later in connection with the investigation. At that time, he retained a different attorney to represent him. The state nolle prossed all but one charge, which was reduced to a third-degree felony to which Neiman pled.

After the completion of the criminal proceedings, Neiman sued the Galloways on the promissory note. The Galloways answered with a general denial, asserting no affirmative defenses. In the meantime, the Galloways filed for bankruptcy, which Neiman successfully avoided due to the fraud contained in the Galloways' petition for bankruptcy. Returning to the circuit court, Neiman moved for summary judgment. The Galloways did not file a cross motion. The trial court denied Neiman's motion for summary judgment, vacating a predecessor judge's order which deemed requests for admission admitted, and then finding that the contract was unenforceable as a matter of public policy and unconscionable as a matter of law.

In actions based on contract, "unconscionability" must be pleaded and proved by the party asserting it. See Southworth & McGill, P.A. v. Southern Bell Tel. & Tel. Co., 580 So.2d 628, 630-31 (Fla. 1st DCA 1991). Here the matter was not pled. The court should not have addressed the issue sua sponte on Neiman's motion for summary...