FIFTH DISTRICT COURT OF APPEAL

STATE OF FLORIDA

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Case No. 5D23-1402

LT Case No. 2019-CA-000944

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KUN XIANG, M.D.,

Appellant,

v.

OCALA HEART CLINIC II, LLC,

WILLIAM F. DRESEN, M.D.,

JOSEPH R. ALONSO, M.D., VIJAY

K. MITTAL, M.D., SUREXA 

CACODCAR, M.D., LAN LUO, M.D.

and TONG LIU, M.D.,

Appellees.

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On appeal from the Circuit Court for Marion County.

Gary L. Sanders, Judge.

Tim W. Sobczak, of Dean, Mead, Egerton, Bloodworth, Capouano 

& Bozarth, P.A., Orlando, for Appellant.

Michael R. Riemenschneider and Jeffrey L. DeRosier, of 

Riemenschneider, Wattwood & DeRosier, P.A., Melbourne, for 

Appellees.

February 2, 2024

SOUD, J.
2

Dr. Kun Xiang appeals the amended final judgment entered 

against him by the trial court in this contractual dispute arising 

from Xiang’s membership in and employment with Ocala Heart

Clinic. We have jurisdiction. See Art. V, § 4(b)(1), Fla. Const.; Fla. 

R. App. P. 9.030(b)(1)(A). We affirm.

I.

Xiang was a cardiologist at the Clinic who, after two years of 

employment, became a member physician. To become a member 

physician, Xiang entered into two different agreements with the 

Clinic: a Member Employment Agreement and an Operating 

Agreement,1 the terms of which require they be read in pari 

materia. These two agreements provided, inter alia, that Xiang 

would buy 100 “membership units” in the Clinic for more than 

$300,000. 

As was customary, the Clinic allowed Xiang to pay the 

purchase amount over a period of years. Xiang elected to pay 

monthly installments over a five-year term with a modest interest 

rate. The trial court received in evidence—without objection—an 

amortization schedule setting forth the amount of the debt and the 

terms of repayment, including the five-year term, the interest rate, 

and the monthly payment identifying amounts assigned to 

principal and interest. Xiang made numerous payments toward 

his buy-in.

Not long after buying in as a member physician, the 

relationship between Xiang and the Clinic soured. The growing 

discord centered in part around Xiang’s assertion that the Clinic

breached its obligation under the Operating Agreement to make a 

distribution to him to cover a 2017 tax liability.2 The Member 

1 Xiang testified that prior to entering into these agreements, 

he read the agreements and consulted with counsel.

2 All member physicians incurred a 2017 tax liability. While 

the Clinic does not seem to dispute its obligation to make a 

distribution to Xiang and all member physicians, the testimony 

before the trial court established it was the Clinic’s longstanding 
3

Employment Agreement required Xiang to give the Clinic ten days’

written notice of the breach as an opportunity for the Clinic to cure. 

He did not do so. 

Ultimately, Xiang resigned. The Member Employment 

Agreement required Xiang to provide the Clinic with 180 days’

notice of his resignation. Again, he did not do so, resigning with 

approximately forty-five days’ notice to the Clinic.

Xiang’s resignation triggered the Clinic’s repurchase of his 

membership units. Related thereto, the Operating Agreement 

provides:

Upon the purchase of Units owned by Kun Xiang, 

M.D., any balance owed to the Company by 

him on the Xiang Promissory Note shall be 

deemed indebtedness . . . . In the event the 

Purchase Price . . . is less than the amounts 

due under the Xiang Promissory Note, Kun 

Xiang, M.D.[,] shall be required to pay the 

Company any such difference.

Whatever the cause, no promissory note was ever executed 

between Xiang and the Clinic. A clinic representative testified he 

believed “it was just an oversight.”

Pertinent here, Xiang filed, as amended, a seven-count 

complaint. The Clinic answered and filed a two-count 

counterclaim: count I for breach of the Member Employment 

Agreement and count II for payment of the balance of the buy-in 

price required by the Operating Agreement.3

practice not to pay such a distribution and that members simply 

paid their respective tax liabilities.

3 The issues we address in this opinion arise from the trial 

court’s determinations on the Clinic’s counterclaim. We affirm 

without further comment the trial court’s decision on Xiang’s 

amended complaint.
4

Following a two-day bench trial,4 as to count I of the Clinic’s 

counterclaim, the trial court found that Xiang breached the 

Member Employment Agreement but awarded no damages, 

concluding that any damages were speculative given the lack of 

evidence introduced at trial. The trial court found the Clinic to be 

the prevailing party on this count. As to count II of the Clinic’s 

counterclaim, the lower court found that Xiang owed the balance 

of the buy-in price as required by the Operating Agreement and 

entered judgment in favor of the Clinic accordingly. Xiang’s appeal 

followed.5

II.

We review de novo a trial court’s interpretation of a contract, 

which is, of course, a question of law. See Smith v. Carlton, 348 So. 

3d 52, 56 (Fla. 5th DCA 2022). Importantly, however, “[i]n an 

appeal from a bench trial, the trial judge[‘]s findings of fact are 

clothed with a presumption of correctness on appeal, and these 

findings will not be disturbed unless the appellant can

demonstrate that they are clearly erroneous.”6 Covelli Fam., L.P. 

v. ABG5, L.L.C., 977 So. 2d 749, 752 (Fla. 4th DCA 2008) (internal 

quotations and citations omitted).

Further, the trial court’s determination of the prevailing party

for purposes of awarding attorneys’ fees is reviewed for abuse of 

4 During trial, Xiang abandoned all but two counts of his 

amended complaint: count I seeking severance compensation and 

count VII seeking rescission and damages under the Florida 

Securities and Investor Protection Act.

5 The Clinic did not cross appeal.

6 When a reviewing court concludes that a trial court’s finding, 

whether express or inferential, “is without support of any 

substantial evidence, is clearly against the weight of the evidence 

or that the trial court has misapplied the law to the established 

facts, then the decision is ‘clearly erroneous’” and we “will reverse 

because the trial court has ‘failed to give legal effect to the 

evidence’ in its entirety.” Holland v. Gross, 89 So. 2d 255, 258 (Fla. 

1956).
5

discretion. Hardeman Landscape Nursery, Inc. v. Watkins, 290 So. 

3d 574, 576 (Fla. 2d DCA 2020) (citing Erhm Orthopedics, Inc. v. 

Edwards, 260 So. 3d 559, 561 (Fla. 2d DCA 2019)).

A.

As to count I of the Clinic’s counterclaim, the trial court found 

that Xiang breached the Member Employment Agreement by 

failing to (i) give the required ten-day written notice of breach and 

opportunity to cure and (ii) give 180 days’ notice of his resignation. 

However, while the trial court found in favor of the Clinic it 

determined that “any award of damages would be speculative at 

best based upon the inadequacy of the evidence produced at trial.”

Since the Clinic failed to prove damages, Xiang argues the trial 

court erred in finding the Clinic was the prevailing party on this 

count. We disagree.

“[T]he party prevailing on the significant issues in the 

litigation is the party that should be considered the prevailing 

party for attorney’s fees.” Moritz v. Hoyt Enters., Inc., 604 So. 2d 

807, 810 (Fla. 1992) (emphasis added). Thus, “the fairest test to 

determine who is the prevailing party is to allow the trial judge to 

determine from the record which party has in fact prevailed on the 

significant issues tried before the court.”7 Id. A trial court is vested 

with broad discretion to determine which party has prevailed in 

the case before it. Skylink Jets, Inc. v. Klukan, 308 So. 3d 1048, 

1051 (Fla. 4th DCA 2020) (citing Sidlow v. Bowles Custom Pool & 

Spas, Inc., 32 So. 3d 722, 722 (Fla. 5th DCA 2010)).

It is certainly true that damages are an essential element to 

be proven by a plaintiff in a breach of contract action. Generally, 

“[t]o prove breach of contract, the plaintiff must establish (1) the 

existence of a contract, (2) a breach of the contract, and (3) 

damages resulting from the breach.” Farman v. Deutsche Bank 

Nat’l Tr. Co., as Tr. for Long Beach Mortg. Loan Tr. 2006-05, 311 

So. 3d 191, 195 (Fla. 2d DCA 2020) (internal quotation and citation 

7 In Moritz, the Florida Supreme Court rejected the position 

that the prevailing party is the party who recovered an affirmative 

judgment. Moritz, 604 So. 2d at 809–10; see also Skylink Jets, Inc., 

308 So. 3d at 1051.
6

omitted). “Under Florida law, damages are an essential element of 

an action for breach of contract.” Id. (citations omitted). However, 

proof of damages is not a condition precedent for a party asserting 

a breach of contract claim to be considered the prevailing party. 

“Absent compelling circumstances,[8] . . . ‘[i]n a breach of 

contract action, one party must prevail.’” Khodam v. Escondido 

Homeowner’s Ass’n, Inc., 87 So. 3d 65, 66 (Fla. 4th DCA 2012). This 

is true even when, as in Khodam, a defendant is determined to 

have breached the contract but plaintiff is awarded no damages. 

See id. (“Despite the absence of damages, the finding that appellee 

breached the contract made appellant the prevailing party on the 

litigation’s significant issues.” (citing Green Cos., Inc. v. Kendall 

Racquetball Inv., Ltd., 658 So. 2d 1119, 1121 (Fla. 3d DCA 1995))).

In the case sub judice, the trial judge found that the Clinic

proved Xiang breached the Member Employment Agreement by 

failing to give the required ten-day written notice of breach and 

180 days’ notice of his resignation. Thus, even though the trial 

court declined to award damages, the trial judge was well within 

his discretion to determine the Clinic prevailed. The significant 

issue in this count of the counterclaim was whether Xiang 

breached the Member Employment Agreement. The trial court 

found he did, and that determination is not clearly erroneous.

Under Florida law, this conclusion is sufficient for the Clinic to be 

considered the prevailing party on Count I of its counterclaim.

8 An example of such compelling circumstances would be

where a contract fails as a result of fault by both contracting 

parties. In such an instance “an award of prevailing party fees 

would not be appropriate because it would result in an unjust 

reward to a party whose conduct caused the failure of the contract.”

Hardeman Landscape Nursery, Inc., 290 So. 3d at 576 (internal 

quotations and citation omitted). Additionally, where neither 

party proves a breach of the contract, an award of fees may not be 

warranted. Id. (citing Lasco Enters., Inc. v. Kohlbrand, 819 So. 2d 

821, 826 (Fla. 5th DCA 2002)).
7

B.

As to the judgment entered in favor of the Clinic on Count II 

of its counterclaim, Xiang argues that the trial court erred in 

finding in favor of the Clinic and entering judgment for the amount 

he still owed for his buy-in to the membership. Specifically, Xiang

asserts that the Clinic cannot enforce the debt against him after 

he left the Clinic because the Operating Agreement contemplates

“amounts due under the Xiang Promissory Note”—a promissory 

note that does not exist. We disagree.

Importantly, the existence of the debt incurred by Xiang to 

purchase his membership in the Clinic was not disputed at trial.

As the trial court found, and as the record before us makes clear, 

Xiang agreed to the buy-in amount. The trial court received into

evidence at trial—without objection—the amortization schedule 

for Xiang’s buy-in, which identifies the buy-in amount, the fiveyear payment period, the interest charged, and the portions of each 

payment assigned to principal and interest. Xiang’s own testimony 

confirmed he was provided a copy of the amortization schedule 

prior to becoming a member and agreed to it. Indeed, Xiang made 

numerous payments toward the buy-in as set out in the 

amortization schedule prior to his resignation from the Clinic.

The parties’ failure to execute a promissory note as 

contemplated by the Operating Agreement is not fatal to the 

existence of the debt Xiang owed to the Clinic. “A promissory note 

evidence[s] a debt and specif[ies] terms under which one party will 

pay money to another. But a promissory note is not required to 

create a debt . . . .” In re Luna Devs. Grp., LLC, 618 B.R. 595, 615 

(Bankr. S.D. Fla. 2020) (internal quotation and citation omitted).

Thus, while a promissory note evidences a debt, it does not 

constitute the debt itself. See Price v. Mize, 628 P.2d 705, 706

(Okla. 1981) (“A promissory note is an unconditional written 

promise, payable to order or to bearer, signed by the maker, in 

which the maker agrees to pay a fixed sum of money on demand or 

at a definite time. A debt is a sum of money due upon either an 

express or an implied contract. The promissory note is not a loan 

or a debt, it is only the evidence of indebtedness from the maker to 
8

the payee.”).9 Indeed, in foreclosure cases, the absence of a 

promissory note does not render a mortgage unenforceable. 

See Thomas v. Thomas, 96 So. 2d 771, 773 (Fla. 1957) (finding the 

mere absence of a promissory note evidencing a debt did not 

prohibit a holding that the transaction was a mortgage 

arrangement); Crum v. U.S. Fid. & Guar. Co., 468 So. 2d 1004, 

1007 (Fla. 1st DCA 1985) (a one-month period between the 

execution of mortgage and the corresponding promissory note does 

not render the mortgage unenforceable for lack of 

consideration); see also First Am. Bank of N.Y. v. Sloane, 651 

N.Y.S.2d 734, 735 (1997) (finding a mortgage is not invalidated by 

the absence of the note or bond manifesting the debt).

As the want of a promissory note does not eviscerate the 

existence of the buy-in debt, it follows then that the lack of a 

promissory note does not preclude enforcement of the debt against 

Xiang. The Clinic’s legal right to collect the remainder of the buyin price after Xiang’s resignation emanates from the Operating 

Agreement. Specifically, as to the Clinic’s redemption of Xiang’s 

membership units, the Operating Agreement provides:

Upon the purchase of Units owned by Kun Xiang, 

M.D., any balance owed to the Company by 

him on the Xiang Promissory Note shall be 

deemed indebtedness . . . . In the event the 

Purchase Price . . . is less than the amounts 

due under the Xiang Promissory Note, Kun 

Xiang, M.D.[,] shall be required to pay the 

Company any such difference.

Thus, the balance Xiang owed for the buy-in remained an 

indebtedness even after his resignation. The precise balance owed 

by Xiang was evidenced by the amortization schedule stipulated 

into evidence during trial and the payments Xiang made before his 

resignation. And since the amount still owed by Xiang exceeded

9 This can be further seen when considering the definition of 

“promissory note” in the context of Florida’s Uniform Commercial 

Code, which defines a promissory note as “an instrument that 

evidences a promise to pay a monetary obligation . . . .” 

§ 679.1021(1)(mmm), Fla. Stat. (2018).
9

the purchase price to be paid by the Clinic to redeem his 

membership units,10 the Operating Agreement makes clear he 

remained liable for the unpaid balance of the buy-in. 

III.

Accordingly, for these reasons, the Amended Final Judgment 

of the trial court is AFFIRMED.

It is so ordered.

HARRIS and PRATT, JJ., concur.

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Not final until disposition of any timely and 

authorized motion under Fla. R. App. P. 9.330 or 

9.331.

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10 The Operating Agreement sets forth a method for 

determining the purchase price the Clinic must pay to redeem a 

transferring member’s membership units. Because of the brevity 

of Xiang’s tenure as a member, the Clinic’s purchase price to 

redeem his membership units was zero.