River Road Const. Co. v. Ring Power Corp.

• Decision Date: 07 August 1984
• Docket Number: No. AM-221,AM-221
• Citation: 454 So.2d 38
• Parties: RIVER ROAD CONSTRUCTION COMPANY, Appellant, v. RING POWER CORPORATION, Appellee.
• Court: Florida District Court of Appeals

Page 38

454 So.2d 38

RIVER ROAD CONSTRUCTION COMPANY, Appellant, v. RING POWER CORPORATION, Appellee.

No. AM-221.

District Court of Appeal of Florida,

First District.

Aug. 7, 1984.

Clifford L. Adams, Jasper, for appellant.

Paul M. Harden, Jacksonville, for appellee.

PER CURIAM.

River Road Construction Company, defendant below, appeals the order of the trial judge finding that Ring Power Corporation, plaintiff below, was entitled to attorney's fees, costs, and interest over and above the amount set forth in River Road's offer of judgment.

Ring Power sued River Road for $8,792.46 due as a result of a business transaction between the parties, attorney's fees, costs, and interest. Attached to the complaint was a statement of account showing the amount owed to be $8,792.46. River Road defended on the ground that the scraper which was leased to it by Ring Power was defective, and claimed a setoff in the amount of $2,586.89 for repairs made. River Road thereafter served on Ring Power an offer of judgment pursuant to Rule 1.442, Florida Rules of Civil Procedure, offering

to allow judgment in the sum of $6,205.57 in favor of the plaintiff, Ring Power Corporation.

Seven days later Ring Power filed and served an acceptance of the offer of judgment. Ring Power filed on the same day a motion to tax costs and attorney's fees.

At the hearing on the motion to tax costs and attorney's fees, Ring Power submitted for introduction into evidence an "Application for Credit" to open an account with Ring Power, that had been executed by River Road. The application provided, in part, that:

should the services of a lawyer be necessary to collect amounts outstanding, it is agreed by the undersigned that a reasonable collection fee will be imposed.

River Road objected to the claim for attorney's fees because a claim for attorney's fees had not been properly pled in Ring Power's complaint and because River Road's offer of judgment did not include an offer to pay attorney's fees. The only reference to attorney's fees in the complaint was:

4. Plaintiff is obligated to pay its attorney a reasonable fee for his services in bringing this action.

WHEREFORE, Plaintiff demands judgment for damages, reimbursement of costs in this action, interest and attorney's fees against the Defendant.

No document was attached to the complaint indicating a basis for entitlement to attorney's fees. Nevertheless, the trial court permitted introduction of the credit application and entered final judgment for Ring Power in the amount set forth in the offer of judgment plus $251.60 interest, $56.00 in costs, and $1,000.00 as a reasonable attorney's fee, for a total of $7,513.17.

On appeal, River Road contends that the trial court erred in awarding attorney's fees and interest. With respect to the award of interest, that question was not addressed at the above-referred hearing. In fact, Ring Power's motion to tax costs and attorney's fees made no reference to any claim for additional amounts attributable to prejudgment interest. On appeal, Ring Power states that the amount of interest awarded by the trial court was arrived at on the basis of "the statutory rate from the time of the acceptance of the offer of judgment through the entry of the order including the costs in (sic) attorney's fees."

Two issues coalesce in this case: (1) the burden of the party claiming attorney fees, costs, and interest to plead properly the claim, including setting forth the basis for entitlement to such items; and (2) the effect of an offer of judgment which neither expressly excludes nor includes costs, fees, and interest accrued as of the time the offer is made.

Rule 1.442 provides, in pertinent part, as follows:

At any time more than 10 days before the trial begins a party defending against a claim may serve an offer on the adverse party to allow judgment to be taken against him for the money or property or to the effect specified in his offer with costs then accrued .... An offer not accepted shall be deemed withdrawn, and evidence of it is not admissible except in a proceeding to determine costs. If the judgment finally obtained by the adverse party is not more favorable than the offer, he must pay the costs incurred after the making of the offer.

Costs are the statutory allowances recoverable by a successful party as an incident to the main adjudication and need not be specifically pled or claimed. Golub v. Golub, 336 So.2d 693 (Fla. 2d DCA 1976). We find that this allowance should be made regardless of whether the offer itself expressly refers to costs and that such costs are in addition to the amount stated in the offer of judgment. Accordingly, the trial court correctly allowed costs in addition to the stated amount of the offer.

With respect to the attorney's fees question, the significant point is that Ring Power's claim for attorney's fees was based upon contract instead of statute. If the fee claim had been based upon statute, the omission of any reference to fees in the offer or acceptance would not be fatal to the plaintiff's subsequent claim therefor. See Encompass Incorporated v. Alford, 444 So.2d 1085 (Fla. 1st DCA 1984); Wisconsin Life Insurance Company v. Sills, 368 So.2d 920 (Fla. 1st DCA 1979); Parliament Insurance Company v. That Girl in Miami, Inc., 377 So.2d 1011 (Fla. 3d DCA 1979). However, where fee claims are based upon contract, such claims must be pled and proved as part of the damages suffered by the plaintiff, Wallace v. Gage, 112 Fla. 730, 150 So. 799 (1933), the entitlement thereto and the amount thereof being determined by the trier of fact (absent stipulation otherwise by the parties) in the same manner as other elements of damage. See Baruch v. Giblin, 122 Fla. 59, 164 So. 831, 833 (1935); Lamoureux v. Lamoureux, 59 So.2d 9, 12 (Fla. 1951).

Pertinent to our consideration of both the attorney's fees and prejudgment interest questions is our holding in a recent offer of judgment case:

Unlike attorney's fees awardable by statute to a prevailing party, prejudgment interest is an element of compensatory damages which must be determined by the trier of fact as any other element of damages. 32 Fla.Jur.2nd Interest and Usury § 17; Aetna Insurance Company v. Settembrino, 369 So.2d 954 (Fla. 3rd DCA 1978); cf. Division of Administration, etc. v. Tsalickis, 372 So.2d 500 (Fla. 4th DCA 1979). We conclude that an offer of judgment which contains only a single figure includes all elements of damages attributable to plaintiff's cause of action, including the damage resulting from deprivation of the use of the money. See Davis v. Chism, 513 P.2d 475, 482 (Alaska 1973). (e.s.)

Encompass Incorporated v. Alford, supra, 444 So.2d at 1087. Claims for attorney's fees based upon contract and claims for prejudgment interest should be treated alike as elements of damages which are an integral part of the plaintiff's cause of action. And when the defendant submits an offer of judgment in a sum certain, the plaintiff who accepts such offer will be precluded from recovering additional sums attributable to prejudgment interest or attorney's fees not awardable by statute.

Additionally, we find that the trial court, at the hearing on Ring Power's motion to tax costs and attorney's fees, reversibly erred in receiving into evidence, over River Road's objections, the above-referred credit application which provided for attorney's fees. Ring Power's complaint was a brief pleading stating a cause of action based upon an account stated. Although the ad damnum included a demand for attorney's fees, the complaint failed to include, either in the body of the complaint or in the statement of account attached thereto, anything which would frame the issue or suggest a basis for Ring Power's entitlement to attorney's fees. Under our rules of procedure, there is ample opportunity for the party seeking affirmative relief to plead his case and place the defendant upon proper notice by the allegations in the body of the complaint. Therefore, even if we were to agree with the trial court's assumption that an offer of judgment which makes no reference to fees does not preclude a subsequent award of nonstatutorily based fees, it was nevertheless improper for the court to receive in evidence, over River Road's objections, a document purportedly embodying an agreement between the parties to pay attorney's fees where the complaint had failed to state any basis for entitlement to such fees.

In sum, a proper offer of judgment was served and filed by River Road and it was accepted by Ring Power. The fact that Ring Power may not have realized that its acceptance of the offer in that form would preclude recovery of contractual attorney's fees and prejudgment interest should avail Ring Power nothing. Ring Power must be presumed to know the legal consequences of its own pleadings and its acceptance of River Road's offer of judgment.

This case is REVERSED and REMANDED to the trial court for entry of a judgment for Ring Power in the sum of $6,205.57 plus the costs as taxed.

Pursuant to Fla.App.R. 9.030(a)(2)(A)(v), we certify the following as questions of great public importance:

Where, in an action at law for damages based upon an account stated, the defendant submits a Rule 1.442 offer to submit to judgment in a sum certain, which offer is accepted by the plaintiff, is the plaintiff entitled to recover an attorney's fee where such fee is based upon contract? Assuming that the answer to such question is in the affirmative, is it error for the trial court, after the plaintiff's acceptance of the defendant's offer, to award an attorney's fee where the complaint made only a bare allegation of entitlement to an attorney's fee without alleging any basis therefor and without attaching any contract or document referring to an agreement for an attorney's fee?

WIGGINTON and NIMMONS, JJ., concur.

BOOTH, J., dissents with opinion.

BOOTH, Judge, dissenting:

I dissent. This court should...