Procacci Commercial Realty, Inc. v. Department of Health and Rehabilitative Services, 95-3317

• Decision Date: 22 January 1997
• Docket Number: No. 95-3317,95-3317
• Citation: 690 So.2d 603
• Parties: 22 Fla. L. Weekly D262 PROCACCI COMMERCIAL REALTY, INC., as General Partner of Procacci Financial Group, Ltd., Appellant/Cross-Appellee, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, Appellees/Cross-Appellant, and BDC Deland, Ltd., Appellee.
• Court: Florida District Court of Appeals

Page 603

690 So.2d 603

22 Fla. L. Weekly D262

PROCACCI COMMERCIAL REALTY, INC., as General Partner of Procacci Financial Group, Ltd., Appellant/Cross-Appellee, v. DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES, Appellees/Cross-Appellant and BDC Deland, Ltd., Appellee.

No. 95-3317.

District Court of Appeal of Florida First District.

Jan. 22, 1997.

Rehearing Denied Feb. 12, 1997.

Alexander D. Varkas, Jr., and Robert A. Sweetapple of Sweetapple, Broeker & Varkas, Boca Raton, for Appellant/Cross-Appellee.

Ellen D. Phillips, Assistant District Legal Counsel, and Daniel T. Medved, District Legal Counsel, Daytona Beach, for Appellee/Cross-Appellant Department of Health and Rehabilitative Services.

Robert W. Morrison of Allen, Lang, Morrison & Curotto, P.A., Orlando, for Appellee BDC Deland, Ltd.

ON MOTION FOR REHEARING OF ORDER GRANTING ATTORNEYS' FEES

BENTON, Judge.

A motion--appellant's motion for rehearing of court's order of September 23, 1996 awarding attorneys' fees and costs to the State of Florida, Department of Health and Rehabilitative Services and BDC Deland, Ltd. pursuant to Section 120.57(1)(b)(10), Florida Statutes--asks that we vacate our order awarding fees and costs, ¹ contending that the main "appeal raised ... the same issues of fact and issues of law litigated before the Hearing Officer,[ ²]" who found them not to be frivolous. In its reply to motion for rehearing, the Department responds:

Irrespective of the legitimacy of Appellant's factual disputes below, Appellant raised no colorable issue disputing the findings of the Hearing Officer below, but, rather, consistently misrepresented the testimony without regard to the record. Further, Appellant failed to acknowledge well-established caselaw controlling the standards of review in bid protest cases. Appellant did not even cite controlling Supreme Court precedent, citing, rather, lower court cases which were subsequently reversed.

The reply to motion for rehearing also "reassert[ed] the essentially frivolous nature of the litigation below," a bid dispute proceeding which Procacci Commercial Realty, Inc. (Procacci) initiated by filing a protest when the Department of Health and Rehabilitative Services ³ (HRS) announced its intention to lease office space from BDC Deland, Ltd. (BDC) instead of from Procacci. We see no reason to vacate the order ⁴ awarding fees and costs, but take this opportunity to clarify the scope of the award.

On the main appeal, HRS's final order, entered on August 25, 1995, was affirmed without opinion. Procacci Commercial Realty, Inc. v. Department of Health and Rehabilitative Servs., No. 95-3317 (Fla. 1st DCA Sept. 23, 1996). The final order adopted a recommended order entered on July 7, 1995, including the recommendation that Procacci's formal written protest be dismissed. The final order also purported ⁵ to adopt the administrative law judge's "order correcting order" entered on July 24, 1995 which denied attorney's fees HRS sought under section 120.57(1)(b)5., Florida Statutes (1995).

Bid Protest

HRS's invitation to bid (lease number 590:2438) seeking space for HRS offices in Deland specified that bidders provide 140 reserved parking spaces for HRS's exclusive use. ⁶ As part of their bids, bidders were to supply a scaled site drawing showing the layout of buildings and the location and configuration of parking spaces to be allocated to the Department, along with a letter certifying that the prospective lessor agreed to supply 140 parking spaces on site, stating the number of "parking spaces per sq. ft. of [floor] space," and specifying the number of parking spaces assigned to other tenants, if any. HRS expressly reserved the right to seek clarification or to waive non-material deviations from technical requirements of the bid. ⁷

BDC proposed to lease HRS some 18,000 square feet in Woodland Plaza, a shopping center BDC was renovating. Procacci's formal written protest asserted that BDC's bid was nonresponsive to the invitation to bid in that:

1. In order to comply with the terms of the bid, the bidder was required to prove 140 exclusive parking spaces for the benefit o[f] HRS. In order to do so, Dan Paris, BDC DeLand, Ltd. would be required to provide 897 spaces at the site. In its bid, Dan Paris incorrectly stated that only 840 spaces were needed in order to provide compliance with the code and in order to provide the 140 exclusive spaces required in the invitation to bid. The Dan Paris bid represented that 980 spaces are available in the subject parking space. The plan reveals, however, that only 937 spaces are available. In addition, in excess of 50 of these spaces are not to code standards. Therefore, Dan Paris has not and cannot provide adequate parking to meet the requirements of the bid.

2. Separate and apart of [sic] the above, the bid of Dan Paris shows two areas that are reserved for future out-parcel development. As a matter of law, this space may not be included in calculation of the parking since it is reserved for other uses. In excess of 150 spaces are located in this area, separately rendering the bid non-responsible [sic] with regard to the parking requirement.

Evidence showed BDC had rented only 66,000 of the 168,000 gross square feet in Woodland Plaza, and that there would have been adequate parking on site even if all 168,000 gross square feet in Woodland Plaza had been occupied.

The recommended order found that a local zoning official had determined that BDC "had enough space on site to provide parking spaces complying with local codes for HRS, current tenants and future tenants." As alleged, BDC's site plan included two boxes in the area representing the parking lot, each labeled "future out-parcel." But the evidence showed that BDC owned the entire site and had not contracted to sell any of it; and that the City of Deland would not permit use of the potential "future out-parcels," except for parking, without prior approval. Such approval would, the evidence showed, entail meeting all code requirements, including making provision for adequate green space and parking.

The parking lot at Woodland Plaza was much bigger than necessary to provide HRS exclusive use of 140 legal and conforming parking spaces on site, without compromising or infringing upon parking spaces available for the other tenants, none of whom had assigned parking. Indeed, Procacci conceded that there was enough parking, at the time bids were submitted and at the time of the hearing, claiming only that problems would arise in the future. The questions Procacci raised about the future were all decided adversely to Procacci's position, however. Unequivocal findings were amply supported by competent evidence in this regard.

Sanctions Sought Below

Within two weeks of Procacci's formal written protest, see Stockman v. Downs, 573 So.2d 835 (Fla.1991), HRS filed a motion to dismiss/petition for attorney's fee, damages, and costs in which it alleged:

The Department is entitled to attorneys fees, damages, and costs pursuant to Section 120.57(1)(b)(5), in that the protest is filed to harass the Department and cause unnecessary delay in removing to the new leased facility, requiring the Department to remain in facilities currently leased from Procacci at a cost to the Department in Excess of $4000. per month, and resulting in unjust enrichment to Procacci.

Former section 120.57(1)(b)5. and its successor, section 120.569(2), Florida Statutes (Supp.1996), authorize attorney's fee awards in administrative proceedings, ⁸ if a pleading is filed for "an improper purpose." But the hearing officer found no improper purpose. ⁹

Since HRS never appealed the administrative law judge's determination that Procacci did not file its formal written protest for improper purposes, the propriety of that ruling is not a question we have for decision on appeal. The "order correcting order" denying fees under former section 120.57(1)(b)5. must stand. But Procacci goes further and argues that the administrative law judge's determination under former section 120.57(1)(b)5. precludes the award of attorneys' fees under section 120.57(1)(b)10., Florida Statutes (1995). We reject this contention. Two distinct questions are involved. They require separate consideration and discrete resolution.

Frivolous Appeal Warrants Award of Fees

An appellate court "may award reasonable attorney's fees and [reasonable] costs to the prevailing party if the court finds that the appeal was frivolous, meritless, or an abuse of the appellate process." § 120.57(1)(b)10., Fla.Stat. (1995). This language ¹⁰ authorizes an award in favor of an administrative agency. See RHPC, Inc. v. Dep't of Health and Rehabilitative Services, 509 So.2d 1267 (Fla. 1st DCA 1987). Because Procacci's bid protest raised "a disputed issue of material fact, [HRS] ... refer[red] the protest to the division for proceedings under s. 120.57(1)." § 120.53(5)(d)2., Fla.Stat. (1995). With entry of the recommended order, HRS regained jurisdiction of the bid dispute and entered the final order. ¹¹ As appellee defending its order on appeal, HRS was a prevailing party just as BDC was.

In Treat v. State ex rel. Mitton, 121 Fla. 509, 510-11, 163 So. 883, 883-84 (1935), our supreme court defined a frivolous appeal:

A frivolous appeal is not merely one that is likely to be unsuccessful. It is one that is so readily recognizable as devoid of merit on the face of the record that there is little, if any, prospect whatsoever that it can ever succeed. See Hopkinson v. Kennedy, 225 Mass. 231, 114 N.E. 204 [1916]. It must be one so clearly untenable, or the insufficiency of which is so manifest on a bare inspection of the record and assignments of error [or briefs, in keeping with modern practice], that its character may be determined without argument or research. An appeal is not frivolous where a substantial justiciable question can be spelled out of it, or from any part of it, even though such...