Source: https://www.floridabar.org/news/tfb-journal/?durl=/divcom%2Fjn%2Fjnjournal01.nsf%2Fc0d731e03de9828d852574580042ae7a%2Ff328d0a31182fe0c85256d10005d217b%21OpenDocument%26Highlight%3D0%2C%2A
Timestamp: 2018-08-15 05:40:17
Document Index: 745515803

Matched Legal Cases: ['§57', '§57', '§57', '§57', '§57', '§57', '§57', '§57', '§57', '§57', '§57', '§2', 'Art. 5', '§23', '§23', '§57', '§57', '§57', '§57', '§6', '§57', '§57']

Florida Bar Journal – New §57.105 Lawyer Sanctions, Our Ethics, and the Florida Constitution: Recent Developments and a Respectful Dissent – The Florida Bar
May, 2003 Volume LXXVII, No. 5
New §57.105 Lawyer Sanctions, Our Ethics, and the Florida Constitution: Recent Developments and a Respectful Dissent
by John P. Fenner
1999 Fla. Laws Ch. 225 (“tort reform” or the “act”) amended and greatly expanded F.S. §57.105. In theory, courts can now impose sanctions against clients and against their lawyers, for “[losing] any claim or defense . . . not supported by the material facts . . . or . . . not supported by the application of the then-existing law.”
the losing party or the losing party’s attorney knew or should have known that a claim or defense when initially presented to the court or at any time before trial:
The First DCA rejected Bridgestone’s contention that its “defense was initially presented to the court as a good faith argument for the extension . . . of existing law . . . with a reasonable expectation of success” (§57.105(2)). “Bridgestone had no reasonable expectation of success. The argument made on appeal was not a novel argument designed to advance the state of the law; it was simply an argument without any possible merit.”
the courts must apply §57.105 . . . carefully to ensure that it serves the purpose for which it was intended [“to decrease the cost of employing the civil justice system”]. If an order dismissing a claim or striking a defense routinely leads to a motion for attorneys’ fees, the point of the statute would be subverted and, in the end, it might even have the reverse effect of making civil litigation more expensive. The need to adjudicate multiple fee claims in the course of a single case could create conflicts between lawyers and their clients, and it could take time away from the court’s main objective; that is, to resolve the controversy presented by the case.
The First DCA did not suggest how (under the new §57.105) lawyers should reconcile our obligation to represent our clients zealously, with the court’s caution against “routine . . . motion[s] for attorneys’ fees.” If the legislature has given parties the right to collect sanctions, and the courts allow us to obtain sanctions, how can we justify not moving for them?
was not victorious . . . neither his action nor subsequent appeal, were totally without merit. See Concrete & Lumber Enterprises Corp. v. Guaranty Business Credit Corp., [829 So. 2d 247] (Fla. 3rd DCA 2002). (“The only subsections of §57.105 which authorize the trial court to award noncontractual attorneys’ fees are subsections (1) and (3), which require a finding that the suit was frivolously filed or was litigated for the purpose of unreasonable delay.”)
Chief Judge Schwartz’s dissent to Goldfisher rejected the majority’s more cautious approach to §57.105 liability, however: “[T]he action brought below . . . is an awful example of litigation maintained only for the extortionate purpose of securing attorneys’ fees for those who brought it. I would grant the appellee’s motion for its own fees under §57.105.” Though no motion for rehearing en banc was filed in Goldfisher, Chief Judge Schwartz’s original dissenting opinion in Smallwood v. Perez, 717 So. 2d 347 (Fla. 3d DCA 1998), later became the Third DCA’s en banc opinion, affirming “inherent power sanctions” against a trial attorney.
•Fourth DCA
The Fourth DCA—like the Second DCA in Cowgill—may not allow new §57.105 to operate as a fee-shifting device. Read stated:
[T]he 1999 revision changed the standards governing fee awards under §57.105. Unlike the prior version, the current version of the statute does not apply only to an entire action, but now applies to any claim or defense. Moreover, an award of fees is not limited to situations in which there is a complete absence of justiciable issue of law or fact. Instead, under the revised standard, fees shall be awarded if the party or its counsel knew or should have known that the claim or defense was not supported by the facts or an application of then-existing law . . . .
The burden was not on the moving parties to show bad faith or the absence of good faith. Indeed, that would be almost an impossible burden for a movant to carry. How can a party know what the other party told or did not tell its counsel and how could it obtain that information without breaching the rather impermeable wall of attorney-client privilege? Accordingly, we . . . direct that [attorneys’ fees] be equally assessed against [the lawyer] and Montgomery Road.
How broadly will the courts interpret this new statute? In theory, a judge could take the position that, if “claim or defense . . . was . . . supported by the material facts . . . [and] . . . the application of then-existing law,” then the judge would have ruled for you in the first place. Such a broad interpretation would weaken the “American rule” on legal fees.
The Supreme Court ruled that trial courts have “inherent authority” to punish lawyers, but only for “bad faith conduct,” relying on Bitterman v. Bitterman, 714 So. 2d 356, 365 (Fla. 1998). Bitterman allowed sanctions against parties for “inequitable conduct . . . egregious conduct or act[ing] in bad faith.” In doing so, the Supreme Court recognized that lawyers must walk a narrow line between “bad faith litigation tactics” and “zealous advocacy”:
[I]t would be better to have the rules committees develop rules in which “bad faith” is defined and the sanctions specified. In that way, the Bar can debate the issues and present to the Court a proposal that has been fully and fairly scrutinized . . . . I would join in sending the issue of bad faith sanctions against lawyers to the rules committees.
The Supreme Court also decided Moakley’s companion case, Diaz, on the issue of “bad faith.” Diaz starts to flesh out new rules of lawyer conduct, particularly for family lawyers.
there is no way that anyone with knowledge of family law could not have figured out that [the sanctioned lawyer’s client] could not do better [than] accepting the [first, proffered, pre-discovery offer of] settlement . . . . I do not know who was responsible for this. I do not know whether it was the client who did not want to accept the advice that he was given. I do not know whether it was a combination of the two factors.
[S]hould any court . . . enter a final judgment concluding or declaring that any provision of this act improperly encroaches upon the authority of the Florida Supreme Court to determine the rules of practice and procedure in Florida courts . . . . any such provision [is intended to] be construed as a request for rule change pursuant to §2, Art. 5 of the State Constitution and not as a mandatory legislative directive.
A lawyer may reveal . . . information [relating to representation of a client] to the extent the lawyer reasonably believes necessary . .
. (4) to respond to allegations in any proceeding concerning the lawyer’s representation of the client . . . .
The issue of lawyer-client confidentiality, and potential conflicts of interest, did not directly arise in either Moakley or Diaz. It was raised in another inherent power sanction case from the Third DCA—Smallwood v. Perez, 735 So. 2d 495 (Fla. 3d DCA 1999) (en banc), adopting Chief Judge Schwartz’ dissenting opinion in Smallwood v. Perez, 735 So. 2d 490, 494–5 (Fla. 3d DCA 1998). The Supreme Court did not accept this case for discretionary review, however.
“In 1950, a young lawyer, defending a black man in Florida, had the audacity to refer to his client as ‘mister,’ an act that so outraged the justice of the peace, the lawyer was cited for contempt and jailed.”13
Article V of the Florida Constitution ended—for then—Florida’s struggle for an independent judiciary, and an independent, integrated Bar. By vesting exclusive disciplinary jurisdiction in our Supreme Court, Article V divested our legislature (and the lower courts) from the power to discipline lawyers.
Article V of the Florida Constitution [ousted] the circuit courts . . . of whatever inherent disciplinary power over attorneys they had previously held, as well as the statutory power derived from Ch. 454, Fla. Stat. 1955 . . . . This necessarily follows from the clear and unambiguous language of §23 of revised Article V, vesting in the Supreme Court of Florida “exclusive jurisdiction over the admission to the practice of law and the discipline of persons admitted.” . . . The legislature was likewise divested of any legislative control in this field by §23 of Article V.
With the exception of contempt (and the “rarely applicable . . . inequitable conduct doctrine” of Bitterman, enlarged to include “bad faith conduct” by Moakley), the Supreme Court consistently insisted on its exclusive jurisdiction to discipline lawyers, which can only be exercised through its delegates.
[Disciplinary Rule 3-3.1] The exclusive jurisdiction of the Supreme Court of Florida over the discipline [of lawyers] . . . . shall be administered in the following manner, subject to the supervision and review of the court. The following entities are hereby designated as agencies of the Supreme Court of Florida . . . . The board of governors [of The Florida Bar], grievance committees and referees [and Circuit Courts under Disciplinary Rule 3-3.5].
It is a lawyer’s duty, when necessary, to challenge the rectitude of official action . . . . An independent legal profession is an important force in preserving government under law, for abuse of legal authority is more readily challenged by a profession whose members are not dependent on the executive and legislative branches of government for the right to practice.
1	Gary S. Gaffney and Scott A. Mager, Section 57.105’s New Look: The Florida Legislature Encourages Courts to Sanction Unsupported Claims and Dilatory Actions, 76 Fla. B.J. 8 (April 2002).
2	Bane v. Bane, 775 So. 2d 938, 940 (Fla. 2000).
3	Andzulis v. Montgomery Road Acquisitions, 831 So. 2d 237 (Fla. 5th D.C.A. 2002), ruled that courts must assess half of §57.105 sanctions against the losing lawyer. Neustein v. Miami Shores Village, 28 Fla. L. Weekly D83 (Fla. 3d D.C.A. Dec. 26, 2002), also required a 50-50 split, unless the court found “bad faith litigation” under Moakley v. Smallwood, 826 So. 2d 221 (Fla. 2002).
4	Joint Committee of Fla. Trial Lawyers Section of the Bar and Conferences of Circuit and County Court Judges, p. 4.
5	Bridgestone/Firestone, Inc. v. Herron, 828 So. 2d 414 (Fla. 1st D.C.A. 2002); Gahn v. Holiday Property Bond, Ltd., 826 So. 2d 423 (Fla. 2d D.C.A. 2002); O’Grady v. Potash, 824 So. 2d 904 (Fla. 3d D.C.A. 2002); Read v. Taylor, 832 So. 2d 219 (Fla. 4th D.C.A. 2002); and Andzulis, 831 So. 2d 237 (decided under former §57.105, but stating that the result would be the same, under new §57.105). All but Read upheld or imposed §57.105 sanctions against lawyers.
6	See also Andzulis, 831 So. 2d 237, which held that the lawyer had the burden of proof, to establish a good faith defense, to the lawyer’s 50 percent of sanctions.
7	The Third DCA’s footnote 2 also states Mr. Potash had been sued when some plaintiffs “alleged that as a result of a wave of litigation initiated by Potash and others, the [real estate] deal had gone sour.” Potash had filed a voluntary dismissal against O’Grady, whom Potash had impleaded.
8	The Fourth DCA applied Moakley, reversing lawyer sanctions in T/F Systems v. Malt, 814 So. 2d 511 (Fla. 4th D.C.A. 2002). The Fourth DCA remanded, so that the trial court could comply with Moakley’s requirement that lawyers may call witnesses in their defense.
9	The entire act survived a constitutional attack, based on the “Single-Subject” part of Fla. Const. art. III, §6, Enterprise Leasing Co. South Central v. Hughes, 833 So. 2d 832 (Fla. 1st D.C.A. 2002). Even had this attack been successful, our legislature would quickly re-pass a new §57.105, unless the Bar makes a reasoned appeal to the appropriate legislative committees.
10	Gaffney and Mager, supra note 1.
11	See also the Fourth DCA’s opinion in T/F Systems, 814 So. 2d 511, an “inherent authority” sanction case. There, the Fourth DCA quoted Moakley, and required an evidentiary hearing.)
12	See Hechtman v. Nations Title Ins. of New York, 28 Fla. Law Weekly S119 (Fla. Feb. 6, 2003).
13	Mark D. Killian, Wagner Wins Tobias Simon Pro Bono Service Award, The Florida Bar News, April 1, 2002, at 1.
14	Some of these problems are discussed in the author’s December 1999 article in The Florida Bar Famil y Law Commentator, First, Let’s Sanction All the Lawyers, on “inherent authority” and new §57.105.