Orlando/Orange Cnty. Expressway Auth. v. Tuscan Ridge, LLC, 5D10–3470.

• Decision Date: 30 March 2012
• Docket Number: No. 5D10–3470.,5D10–3470.
• Citation: 84 So.3d 410
• Parties: ORLANDO/ORANGE COUNTY EXPRESSWAY AUTHORITY, Appellant, v. TUSCAN RIDGE, LLC, et al., Appellee.
• Court: Florida District Court of Appeals

84 So.3d 410

ORLANDO/ORANGE COUNTY EXPRESSWAY AUTHORITY, Appellant,

v.TUSCAN RIDGE, LLC, et al., Appellee.

No. 5D10–3470.

District Court of Appeal of Florida, Fifth District.

March 30, 2012.

Richard N. Milian and Edgar Lopez of Broad & Cassel, Orlando, and Beverly A. Pohl of Broad & Cassel, Fort Lauderdale, for Appellant.

Craig B. Willis of Fixel, Maguire & Willis, Tallahassee, for Appellee, Joseph B. Doerr Trust, etc.

No Appearance for Appellee, Tuscan Ridge, LLC.

Alan E. Deserio, Stuart, Amicus Curiae for Pacific Legal Foundation.

John A. Rogers, Tallahassee, Amicus Curiae for Florida Retail Federation.

Sanford A. Minkoff, Tavares, Amicus Curiae for Florida Association of County Attorneys.

COHEN, J.

Orlando/Orange County Expressway Authority ("OOCEA") appeals a final judgment awarding attorney's fees in the amount of $816,000 in an eminent domain proceeding. The primary issue on appeal concerns the lower court's refusal to limit attorney's fees awarded to the landowners to those permitted by section 73.092(1), Florida Statutes (2006), based on a pre-suit offer made by OOCEA. Because the issue involves the public interest, three amicus briefs have been filed in this action.¹ We reverse.

OOCEA was involved in the construction of a project known as the John Land Apopka Expressway.² This project was years in development and would have been widely known among the landowners impacted. OOCEA commenced a condemnation proceeding to acquire 9.81 acres of land identified as "Parcel 406" as part of the construction of the expressway. The owner of record was Joseph B. Doerr, as Trustee of The Joseph B. Doerr Revocable Living Trust dated 9/9/94 ("Doerr").

On June 5, 2006, OOCEA made a pre-suit written offer to the known fee owner, Doerr, to "purchase Parcel 406 for $4,914,221.00, subject to all apportionment claims. " (Emphasis added). At the time of the offer, the property was occupied by Florida Container Services, Inc. ("Florida Container"), which leased the property on a month-to-month basis. In December 2005, Doerr had conveyed fifteen percent of the Trust's interest in the subject property to Ministry Systems, Inc. ("Ministry"); however, the transfer was not recorded until July 31, 2006. The offer was not accepted by Doerr, and OOCEA filed suit to condemn the property in August 2006.

All parties agreed to a stipulated order of taking, which granted OOCEA immediate possession of the property but allowed Florida Container to remain on the property through January 5, 2007, provided certain conditions were met. Doerr and Ministry (collectively "Landowners"), the Appellees herein, filed a motion to withdraw the funds deposited by OOCEA. Their motion was uncontested and $4,712,883.32 was paid to Landowners, representing the good faith deposit less outstanding ad valorem taxes. In their motion, Landowners represented that they were the only parties of interest in the parcel, other than the Orange County Tax Collector. Doerr received eighty-five percent of the distribution and Ministry received fifteen percent, in accordance with the ownership percentages outlined in Ministry's quitclaim deed.

Florida Container separately pursued its claims against OOCEA. Its claim was settled at mediation, and a stipulated final judgment entered on March 22, 2007, required OOCEA to pay the tenant $45,000, which was reported to represent compensation for any and all of the company's claims.³

Landowners' stipulated order of taking did not resolve the value of Parcel 406. In July 2007, OOCEA apparently made a collective offer of judgment to Landowners in the amount of $5,500,000.⁴ The offer was not accepted by Landowners, and the compensation issue was tried before a jury in February 2008, approximately one year after Florida Container's settlement. The jury found that Parcel 406 had a fair market value of $5,744,830.

Landowners were represented by the law firm of Fixel, Maguire & Willis ("FMW"). Both clients had virtually identical fee agreements with FMW that recognized the firm would be paid "statutorily calculated Attorney's fees" by the condemning authority, plus a bonus of two percent of the award by Landowners if the award exceeded $5 million. The two-percent bonus, which totaled $117,861, was paid to FMW from the proceeds of the final payment made to Landowners. Following entry of the verdict, Landowners filed a separate motion to recover their "statutory" fees and/or any fees permitted by article X, section 6, of the Florida Constitution.

OOCEA sought to limit attorney's fees to those permitted by section 73.092(1), Florida Statutes (2006), which requires the court to award fees "solely on the benefits achieved for the client." Id. (emphasis added). Landowners argued they were entitled to the more generous "reasonable" attorney's fees allowed by section 73.092(2), and/or the Florida Constitution. The issue was brought before the court on a motion filed by Landowners to preclude application of section 73.092(1). The trial court ultimately agreed with Landowners that section 73.092(1) could not be used to award fees in this case, but that fees should be awarded pursuant to the "reasonable fee" provision of section 73.092(2), using the factors set forth in the statute. As part of its ruling, the court rejected OOCEA's argument that Landowners had waived the right to challenge an award of fees under the "benefits achieved" provisions of section 73.092(1). It further found that FMW's fee agreement, which obligated the firm to accept "statutory" fees, did not limit it to fees pursuant to section 73.092(1). OOCEA's argument that the separate bonus already paid to FMW must be deducted from any fee award was mooted by FMW's agreement to return the bonus to its clients. Because section 73.092(1) was found inapplicable, the trial judge did not reach Landowners' argument that application of the statute would be unconstitutional under the facts and circumstances existing in this case.

At a hearing to determine the amount of fees to be awarded for both the valuation proceedings and supplemental proceedings, it became apparent that both sides had over-litigated the case, and each blamed the opposition for the oversized fees. For the valuation proceedings, FMW claimed it was entitled to be paid for 2,700.3 attorney hours at the rate of $350 or $375 per hour, and 460 paralegal hours at the rate of $120 per hour. Nearly 2,000 of the attorney hours pertained to services performed by Landowners' lead counsel, who did not keep contemporaneous time records but reconstructed his time after the conclusion of the litigation. The court awarded Landowners a total of $816,000 as attorneys' fees for the valuation proceedings and $194,000 relating to the supplemental proceedings. They were also awarded expert fees and costs of $277,422, plus $19,000 in reimbursements. The fees collected by OOCEA's attorneys were similarly sizable.⁵

OOCEA has now appealed the fees awarded to Landowners for the "valuation" portion of the proceedings.⁶ OOCEA argues that Landowners should have been limited to an award of attorney's fees pursuant to subsection (1) of section 73.092. The statute instructs the court that, "except as otherwise provided in this section and section 73.015," the sole factor to consider in awarding fees in an eminent domain proceeding is the "benefits achieved" for the client. § 73.092(1), Fla. Stat. Fees are calculated as a percentage of the "benefits achieved." § 73.092(1)(c), Fla. Stat. The attorneys are entitled to thirty-three percent of any benefit up to $250,000, twenty-five percent of a benefit between $250,000 and $1 million, and twenty percent of any benefit exceeding $1 million. § 73.092(1)(c), 1.–3., Fla. Stat.

Subsection (1) of section 73.092 must be compared with subsection (2) of the same statute, which applies to "attorney's fees incurred in defeating an order of taking, or for apportionment, or other supplemental proceedings, when not otherwise provided for...." § 73.092(2), Fla. Stat. The subsection instructs the court that, with respect to these fees, the court is to consider a list of factors in making the award, which appear to be directed at producing a "reasonable fee." The factors to be considered include: (1) the novelty, difficulty, and importance of the questions involved; (2) the skill employed by the attorney in conducting the cause; (3) the amount of money involved; (4) the responsibility incurred and fulfilled by the attorney; (5) the attorney's time and labor reasonably required adequately to represent the client in relation to the benefits resulting to the client; (6) the fee, or rate of fee, customarily charged for legal services of a comparable or similar nature; and (7) any attorney's fee award made under subsection (1). § 73.092(2)(a)-(g), Fla. Stat.

Read together, these subsections appear to contemplate two forms of fees awards in condemnation cases. Attorney's fees for valuation proceedings are to be awarded using the "benefits achieved" formula of subsection (1), while "reasonable fees" are available under subsection (2) for fees incurred in supplemental proceedings, such as apportionment proceedings between landowners. The statute nonetheless appears to contain a "gap." See Sarasota Cnty. v. Curry, 861 So.2d 1239 (Fla. 2d DCA 2003) ; Fla. Dep't of Transp. v. Smithbilt Ind., Inc., 715 So.2d 963 (Fla. 2d DCA 1998). The gap arises because section 73.092(1) requires a condemning authority to make a written offer to a landowner, before its limiting provisions can come into play, due to the definition of "benefits achieved" set forth in the statute. The definition states:

(a) As used in this section, the term "benefits" means the difference, exclusive of interest, between the final judgment or settlement and the last written offer made by the condemning authority before the defendant hires an attorney. If no written offer is made by the condemning authority before the defendant hires an attorney, benefits must be measured from the

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