Tag Archive for: Contract

Lien

Can they put a lien on my property?

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In many instances, contractors or subcontractors perform work on someone’s property, without the property owner being fully aware of their rights or responsibilities under the lien statutes in Florida. When there is non-payment by the property owner or a dispute over payment, litigation often arises. And, interestingly, litigants, and sometimes courts, aren’t sure of their respective duties.

A case in point is Marble Unlimited, Inc. v. Weston Real Estate Inv. Corp., 125 So.3d 286 (Fla. 4th DCA 2013). Marble Unlimited, Inc. was a granite countertop subcontractor. Beginning in 2003, Marble contracted with Weston Real Estate Investment Corporation (“Weston Investment”) to renovate buildings within a condominium complex. From 2003 to 2007, Marble completed the renovations on buildings 3 through 8 and received payment from Weston Investment. Id at 287. In August 2006, Marble entered into two separate contracts for work on building 9 of the complex. As with the prior contracts, the owner identified in both contracts was Weston Investment. Id. Marble performed under the contracts and in 2008 filed claims of lien against various units, referencing its contracts with Weston Investment. Notices of contest of lien were filed by one John Genoni on behalf of the two corporations identified as owners—Weston Investment and Weston Real Estate Development, LLC (“Weston Development”). Id.

At a jury trial, and the jury awarded Marble $112,237.29 in damages against Weston Investment on the contract claims. The lien claims were decided non-jury. The circuit judge dismissed the lien claims against Weston Development because Marble had not served a notice to owner on Weston Development pursuant to §713.06, Florida Statutes. Marble then appealed.
Lien
The appellate Court noted that lienor who is in privity with the owner is not required to serve a notice to owner, as required by section 713.06. Id at 288. Whether privity exists is a factual inquiry requiring “both knowledge by an owner that a particular subcontractor is supplying services or materials to the job site and an express or implied assumption by the owner of the contractual obligation to pay for those services or materials.” C.L. Whiteside & Assocs. Constr. Co., Inc. v. Landings Joint Venture, 626 So.2d 1051, 1052–53 (Fla. 4th DCA 1993) (citing Harper Lumber & Mfg. Co. v. Teate, 98 Fla. 1055, 125 So. 21 (1929)). Here, at the time work commenced, Marble was in privity with Weston Investment, having signed two contracts where Weston Investment had identified itself as an owner, similar to the way Marble had completed renovations on the previous six buildings. Marble was therefore not required to file a section 713.06(2)(a) notice to owner after it commenced work on building 9. Id.

Interestingly, the appellate Court wasn’t willing to fall for the “switch-a-roo” seemingly attempted by Weston. The appellate Court held: after it contracted with Marble as the owner, Weston Investment could not trigger a duty on the part of Marble to file a notice to owner by transferring ownership of the condominium units to a related corporation, Weston Development. That the corporations were related is evident in the record—John Genoni filed notices of contest on behalf of both corporations and John Genoni, Jr. signed the original contracts on behalf of Weston Investment. To affirm the judgment of dismissal under these circumstances would be to allow corporate owners to play a shell game with ownership and frustrate the valid claims of contractors who complete work on real property. Id.

Photos in this blog are courtesy of: rfiblog.com & californiabusinesslitigationattorneyblog.com

Attorney Fees

How can I get the other side to pay my attorney fees?

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In family law cases, attorney fees are often based on the “need and ability to pay” standard. This can get quite complicated, as I am sure we all need (or at least want) someone else to pay our attorney’s fees. The problem is whether or not the other side as the ability to pay them.

In civil cases, it can be possible to get attorney fees from the other side if a contract provides for fees, or if a statute is on-point. There is an additional way: a Proposal for Settlement. This is governed by Florida Statute §768.79 and Florida Rule of Civil Procedure 1.442.

Attorney FeesWhile the language of both can get complex, it is interesting what can happen if a party chooses to use a proposal for settlement. Recently, in RJ Reynolds and Liggett Group v. Ward, the Plaintiff sought damages from the Defendants. During the time the case was pending, the Plaintiff sent a proposal for settlement, which indicated an amount to settle the case. The Defendant did not accept the proposal. Without going into the nuances of what is required under a proposal for settlement in order to trigger an award of attorney fees, in this case, the Plaintiff received an award from the jury that was well above the proposal. The trial court determined that the Plaintiff was entitled to attorney fees. RJ Reynolds appealed.

The 1st District Court of Appeals held that the Plaintiff did not properly comply with the statute and the Rule of Civil Procedure, and strict compliance is necessary, so the award of $1,452,337.62 in attorney’s fees was reversed. The court even noted that it was clear that punitive damages (the item that wasn’t specifically included in the proposal for settlement) would have been extinguished if the tobacco companies had accepted the offer, but the supreme court made the test strict compliance, not the absence of ambiguity.

Photos in this blog are courtesy of: blog.jamessansonelaw.com, socialsecurityinsider.com

Valid Contract

But, I thought we had a contract!

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Many times, people think they have an agreement with someone, only to find out that they don’t. Of course, if there is no actual “contract”, there may be other remedies available, but the fact that someone doesn’t have a valid, enforceable, contract can cause concern.

In Office Pavilion South Florida, Inc. v. ASAL Products, Inc., 849 So.2d 367 (Fla. 4th DCA 2003), the parties had a contract for keyboards, which obligated one party to purchase a minimum of 1,000 keyboards a year. There was also a provision for the purchase of chairs, however, there was no minimum quantity term for the chairs. The Court noted that it is a fundamental principle of contract law that a promise must be supported by consideration to be enforceable.Valid Contract And, in a contract where the parties exchange promises of performance, “[i]f either of those promises is illusory or unenforceable then there is no consideration for the other promise.” Id at 370. The Court held that Pavilion agreed to sell to ASAL any chairs it chose to order at the price set forth in the price list. While ASAL may have agreed, its acceptance involved no promised performance and therefore did not constitute consideration to support the contract modification for the Aeron Chairs. Id. The Court also noted that, under Florida Statutes §672. 201(1), without a quantity for the amount of chairs purchased, the contract would be unenforceable.

Without all of the requirements of a contract, and a meeting of the minds as to the terms of the contract, the Court here found that a contract did not exist.

Contracts

Have an attorney review your contract before you sign

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I oftentimes talk with existing clients about how important it is to be proactive in making business decisions. You would be surprised how many people come to my office AFTER having signed a contract (many worth hundreds of thousands of dollars) and say: “I just signed this contract. I have concerns about X, Y, or Z. Will you look at it for me?” My first response is: “If you had concerns, why didn’t you come to me or someone else BEFORE you signed the contract.” It is very important when you are entering into a contract to have an attorney review the contract, and discuss with you your legal rights and responsibilities. People often ignore certain “standard” parts of a contract or often feel that they have no ability to negotiate the terms of a contract.

Many terms of a contract are negotiable, and oftentimes, negotiating certain terms of a contract end up benefiting both parties in the end. I have reviewed several contracts where the person presenting the contract to my client used a form from someone else (i.e. no one had consulted an attorney), and didn’t realize there was an agreement that if a lawsuit was brought, venue was in an inconvenient location where neither party would want to litigate. Speaking with an attorney prior to signing a contract can also lead to possible different ways to achieve the same intent of the contract, without as much risk involved.
Contract Dispute
It also gives you the chance to talk with someone experienced who can advise you on what is in your best interest. I have often heard the phrase: “You can’t make a good deal with a bad person.” I am often surprised when someone (who has already signed a contract with a “bad” person) knew that person had failed to fulfill their obligations to previous parties. Most people would seek the advice of a doctor when making a significant medial decision. It is axiomatic that having the benefit of legal advice when entering into a contract where one is obligated to perform is almost necessary to protect one’s person and business interests.

In a recent case out of the 5th District Court of Appeal, Blue Earth Solutions v. Florida Consolidated Properties, LLC, 113 So.3d 991 (5th DCA 2013) the appellate court noted the case was “a classic example of what often occurs when parties attempt to consummate a complex business transaction without the benefit of legal representation. What makes this case especially remarkable is that this business transaction involved almost half a million dollars. Within twenty days after the so-called closing of the sale of business assets, the entire transaction unraveled, culminating in legal proceedings.” Having the advice and counsel of an attorney can help you avoid those situations and make the best possible decisions for you and your business.

Disputed Attorney's Fees

Disputed attorney’s fees

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In cases where attorney’s fees are a disputed issue, each party’s attorney provides an Attorney’s Fee Affidavit, which represents his or her work on a particular case. I always find it interesting to compare other attorney’s affidavits with my own bills, to determine how other firms are billing their clients. In reviewing some of those bills, I located a case, Browne v. Costales, 579 So.2d 161 (Fla. 3d DCA 1991) where the Third District Court of Appeal wasn’t exactly happy with the billing practices of the lawyer:

“Appellee’s second attorney, the recipient of a $20,000 attorney fee award, did not keep time records because he relied on ‘unit billing.’ Appellee’s counsel admitted at oral argument that his apparently silver-tongued efforts as trial counsel secured no equitable distribution, no lump sum alimony, and no permanent or rehabilitative alimony for the wife in this one and one-half year marriage; the sole result which he obtained was $10,000 in temporary support monies.”
Silver Tongued
The Court explained that unit billing is a practice where the attorney bills a predetermined number of minutes for a given task. The Court found that the attorney’s practice of unit billing was unacceptable, and “serves to fuel the opprobrium felt for the legal profession.”

The Court went on to note that the attorney had “the effrontery to explain that his unit billing included the time necessary for him to fold the paper, stuff the envelopes, and seal them (no doubt with his silver tongue).”

The Court also cited to The Florida Bar v. Richardson, 574 So.2d 60 (Fla.1990) where the Florida Supreme Court suspended an attorney, finding “absolutely no justification” for unit billing, stating: Lawyers are officers of the court. The court is an instrument of society for the administration of justice. Justice should be administered economically, efficiently, and expeditiously. The attorney’s fee, is therefore a very important factor in the administration of justice, and if it is not determined with proper relation to that fact it results in a species of social malpractice that undermines the confidence of the public in the bench and bar. It does more than that; it brings the court into disrepute and destroys its power to perform adequately the function of its creation. The Florida Bar v. Richardson, 574 So.2d at 62 (quoting Baruch v. Giblin, 122 Fla. 59, 164 So. 831 (1935)).