Case Name: Kathryn HUBBEL, Petitioner, v. AETNA CASUALTY & SURETY COMPANY, Respondent; C.B. Herbert, et al., Petitioners, v. Aetna Casualty & Surety Company, Respondent
Court: Florida Supreme Court
Jurisdiction: Florida
Decision Date: 2000-04-20
Citations: 758 So. 2d 94
Docket Number: Nos. SC92532, SC92848
Parties: Kathryn HUBBEL, Petitioner, v. AETNA CASUALTY & SURETY COMPANY, Respondent. C.B. Herbert, et al., Petitioners, v. Aetna Casualty & Surety Company, Respondent.
Judges: HARDING, C.J., and SHAW, WELLS and PARIENTE, JJ., concur.
Reporter: Southern Reporter, Second Series
Volume: 758
Pages: 94–105

Head Matter:
Kathryn HUBBEL, Petitioner, v. AETNA CASUALTY & SURETY COMPANY, Respondent. C.B. Herbert, et al., Petitioners, v. Aetna Casualty & Surety Company, Respondent.
Nos. SC92532, SC92848.
Supreme Court of Florida.
April 20, 2000.
J. Gordon Blau, Orlando, Florida, and Marcia K. Lippincott, Lake Mary, Florida, for Petitioner.
Kimberly A. Ashby of Maguire, Voorhis & Wells, P.A., Orlando, Florida, and James W. Sears of Sears & Manuel, P.A., Orlando, Florida, for Respondent.

Opinion:
PER CURIAM.
We have before us the opinions in Aetna Casualty & Surety Co. v. Hubbel, 704 So.2d 1141 (Fla. 5th DCA 1998), and Aetna Casualty & Surety Co. v. Herbert, 706 So.2d 417 (Fla. 5th DCA 1998), which we have consolidated for purposes of review. In these cases, the Fifth District Court of Appeal concluded that, in an action alleging a motor vehicle dealer's violation of Chapter 501; Part II, Florida Statutes, Florida's Deceptive and Unfair Trade Practices Act (FDUTPA), attorney's fees could not be recovered from a surety bond that does not provide for such fees. In so holding, the district court certified conflict with Marshall v. W & L Enterprises Corp., 360 So.2d 1147 (Fla. 1st DCA 1978), in which the First District Court of Appeal concluded that the surety for a mobile home dealer was liable for attorney's fees incurred by the plaintiffs who successfully established that the dealer violated FDUT-PA. We have jurisdiction. Art. V, § 3(b)(4), Fla. Const. For the reasons expressed, we approve the result of the district court's decisions in these cases and we disapprove Marshall.
The facts of these two consolidated cases are set forth below.
HUBBEL
Kathryn Hubbel filed a claim for $345.00 against a motor vehicle dealer alleging fraud and deceptive trade practices. She also sought recovery under the $25,000 surety bond issued to the dealer by Aetna Casualty & Surety Company (Aetna) under section 320.27(10), Florida Statutes (1997). After the dealer defaulted and a default judgment was entered, Hubbel filed a demand for judgment against Aetna for $345.00, which Aetna paid. The county court subsequently granted attorney's fees against the dealer and Aetna in favor of Hubbel in the amount of $10,000. Aetna appealed the award of attorney's fees, and the circuit court affirmed the county court order. The circuit court held that the attorney's fee provision of FDUTPA was incorporated in section 320.27(10), the statute that requires motor vehicle dealers to post a surety bond or to obtain a letter of credit to cover consumer losses. In doing so, the circuit court relied on Marshall.
The district court quashed the circuit court's affirmance of the county court's award of attorney's fees. See Hubbel. First, the district court stated that Aetna's surety bond did not contain a provision for an award of attorney's fees. Next, the district court stated that the attorney's fee provision in FDUTPA does not apply to a surety bond action under chapter 320. The district court noted, however, that the First District, in Marshall, had reached a contrary conclusion under a nearly identical statute.
HERBERT
C.B. and Annie Herbert filed a claim in county court against a motor vehicle dealer and its surety, Aetna, charging the dealer with violations of chapter 320, which also constituted deceptive trade practices under FDUTPA. The surety bond was provided to the dealer pursuant to section 320.27(10). At a non-jury trial, the dealer was found to have engaged in unfair and deceptive trade practices and the trial court awarded $33.77 in damages. The county court then awarded attorney's fees against the dealer and Aetna in the amount of $11,550, which Aetna appealed. The circuit court affirmed the award, but the Fifth District summarily quashed the circuit court's affirmance, citing to its decision in Hubbel. See Herbert.
Attorney's Fees Under Section 320.27(10)
Petitioners Hubbel and Herbert argue that the loss covered by a motor vehicle dealer's bond includes attorney's fees because section 320.27(10) requires the bond to cover "any loss or damage" of a dealer's customer and because the attorney's fee provision under FDUTPA is incorporated into chapter 320. They assert that public policy dictates such a finding because both chapter 320 and FDUTPA were designed to protect consumers and to make them whole. Alternatively, petitioners, for the first time, argue that attorney's fees should be awarded under section 627.428, Florida Statutes (1997), because this Court recently concluded in Nichols v. Preferred National Insurance Co., 704 So.2d 1371 (Fla.1997), that attorney's fees are proper against surety companies under that provision. That claim was not made in the trial court or before the district court of appeal.
The statements of claims in these cases specifically alleged fraud and intentional misrepresentation and deceptive and unfair trade practices against the motor vehicle dealers under FDUTPA. Section 501.2105, Florida Statutes (1997), a part of FDUTPA, provides for attorney's fees for the prevailing party in such an action. However, the statute in issue in this proceeding is section 320.27(10) and the bond provisions directed by the state agency to implement that statute. It requires motor vehicle dealers to obtain surety bonds or an irrevocable letter of credit in the amount of $25,000 prior to obtaining a license. Under that provision, "[s]uch bonds and letters of credit shall be to the department and in favor of any person . who shall suffer any loss as a result of any violation of the conditions hereinabove contained." The "hereinabove contained" language refers to the following condition language: "Surety bonds and irrevocable letters of credit shall be in a form to be approved by the department and shall be conditioned that the motor vehicle dealer shall comply with the conditions of any written contract made by such dealer in connection with the sale or exchange of any motor vehicle and shall not violate any of the provisions of chapter 819 and [chapter 320] in the conduct of the business for which the dealer is licensed."
The issue is whether attorney's fees are to be considered "any loss" under section 320.27(10). The court in Marshall addressed a similar issue as it applied to an earlier version of a related statute, section 320.77, which is the statute governing surety bonds for mobile home dealers. In Marshall, the court concluded that section 320.77 included attorney's fees provided for under FDUTPA because the reference in section 320.77 to "any loss" applied to any "violation of any provision of [section 320.77] or of any other law of this state having to do with dealing in mobile homes." The Marshall court concluded that a violation of FDUTPA was obviously a violation of a law of this state and accordingly included attorney's fees under the term "any loss." The court also noted that
[t]he obvious purpose of the "Little FTC Act" is to make consumers whole for losses caused by fraudulent consumer practices. Similarly, the purpose of the bonding and licensing requirements in chapter 320 is protection of consumers who deal with mobile home dealers. These aims are not served if attorney's fees are not included in the protection.
360 So.2d at 1148.
We find the Marshall court's partial reliance on the "any other law" language found in section 320.77(10), Florida Statutes (1975), misplaced. That language pertained only to the suspension or revocation of a mobile home dealer's license, and not the provision for a surety bond found in section 320.77(11). That same "any other law" language is similarly confined in the licensing provision of the statutory scheme we consider today.
Further, like the statutory bond provision at issue in Marshall, the statute in this case states that "any loss" applies to "the conditions of any written contract" made by the dealer during a sale and to any violations of chapters 319 and 320. It does not extend to violations of "any law of the state." Generally, the law is clear that attorney's fees are not considered to be a "loss" or damages, and to be recoverable must be expressly provided for by statute, rule, or contract. The written contract in this case, the surety bond, does not contain a provision for attorney's fees. Nor does the complaint assert any violations of chapters 319 and 320. Most important, there is no provision for attorney's fees in section 320.27(10). While chapter 320 does contain provisions for attorney's fees elsewhere, see, e.g. § 320.697, 320.8245, 320.838, Fla. Stat. (1997), it does not contain such a provision in section 320.27(10).
We conclude that under the plain language of the statute, attorney's fees are not included under the statutory scheme set forth in section 320.27(10); accordingly, we disapprove Marshall.
Next, we find the asserted public policy concerns are not justifiable and would effectively destroy the statutory scheme which establishes a modest fund for consumers to obtain a refund of their monies. As illustrated by the facts in this case, to accept the view of the petitioners would mean the primary beneficiary of the fund would be the attorneys, not the consuming public. The legislative scheme was intended to establish a very modest fund of $25,000 from which consumers could recover damages when car dealers went out of business and defaulted in their obligations. The Hubbel case is an illustration of the type of claim that was intended to be protected. Once the default was entered and the validity of the claim'established, which easily could have been done in a small claims proceeding, the judgment was immediately paid by the surety. If we accepted the arguments of the claimants in this' case, logic and commonsense necessarily lead to the conclusion that the asserted judicial construction would result in the attorney's fee provisions substantially depleting the fund. The applicable statute, section 320.27(10), by its clear terms, states "the aggregate liability of the surety in any one year shall in no event exceed the sum of the bond, or in the case of a letter of credit, the aggregate liability or the issuing bank shall not exceed the sum of the credit." If the obligation was as open-ended as asserted by the claimants, few sureties and no banks would provide the bond or letter of credit to make this statutory scheme work.
We reject petitioner's claim in this Court based upon Nichols v. Preferred, National Insurance Co., 704 So.2d 1371 (Fla.1997). That case interpreted the provisions of section 627.428. The petitioners in the instant case failed to claim attorney's fees under that section both at trial and on appeal.
Accordingly, for the reasons expressed, we approve the result reached by the district court in these cases.
It is so ordered.
HARDING, C.J., and SHAW, WELLS and PARIENTE, JJ., concur.
LEWIS, J., concurs in part and dissents in part with an opinion, in which ANSTEAD, J., concurs.
. Section 320.27(10) provides in full as follows:
(10) SURETY BOND OR IRREVOCABLE LETTER OF CREDIT REQUIRED.—
(a) Annually, before any license shall be issued to a motor vehicle dealer, the applicant-dealer of new or used motor vehicles shall deliver to the department a good and sufficient surety bond or irrevocable letter of credit, executed by the applicant-dealer as principal, in the sum of $25,000.
(b) Surety bonds and irrevocable letters of credit shall be in a form to be approved by the department and shall be conditioned that the motor vehicle dealer shall comply with the conditions of any written contract made by such dealer in connection with the sale or exchange of any motor vehicle and shall not violate any of the provisions of chapter 319 and this chapter in the conduct of the business for which the dealer is licensed. Such bonds and letters of credit shall be to the department and in favor of any person in a retail or wholesale transaction who shall suffer any loss as a result of any violation of the conditions hereinabove contained. When the department determines that a person has incurred a loss as a result of a violation of chapter 319 or this chapter, it shall notify the person in writing of the existence of the bond or letter of credit. Such bonds and letters of credit shall be for the license period, and a new bond or letter of credit or a proper continuation certificate shall be delivered to the department at the beginning of each license period. However, the aggregate liability of the surely in any one year shall in no event exceed the sum of the bond or, in the case of a letter of credit, the aggregate liability of the issuing bank shall not exceed the sum of the credit.
(c) Surety bonds shall be executed by a surety company authorized to do business in the state as surety, and irrevocable letters of credit shall be issued by a bank authorized to do business in the state as a bank.
(d) Irrevocable letters of credit shall be engaged by a bank as an agreement to honor demands for payment as specified in this section.
(e) The department shall, upon denial, suspension, or revocation of any license, notify the surety company of the licensee, or bank issuing an irrevocable letter of credit for the licensee, in writing, that the license has been denied, suspended, or revoked and shall state the reason for such denial, suspension, or revocation.
(f) Any surety company which pays any claim against the bond of any licensee or any bank which honors a demand for payment as a condition specified in a letter of credit of a licensee shall notify the department in writing that such action has been taken and shall state the amount of the claim or payment.
(g) Any surety company which cancels the bond of any licensee or any bank which cancels an irrevocable letter of credit shall notify the department in writing of such cancellation, giving reason for the cancellation.
. Section 320.27(9) provides in pertinent part:
(9) DENIAL, SUSPENSION, OR REVOCATION.—
The department may deny, suspend, or revoke any license issued hereunder or under the provisions of s. 320.77 or s. 320.771, upon proof that a licensee has failed to comply with any of the following provisions with sufficient frequency so as to establish a pattern of wrongdoing on the part of the of the licensee:
(a) Willful violation of any other law of this state, including chapter 319, this chapter, or ss. 559.901-559.9221, which has to do with dealing in or repairing motor vehicles or mobile homes or willful failure to comply with any administrative rule promulgated by the department.
. The surety bond provision applicable in Marshall provided the following, in pertinent part:
The bond shall be in a form to be approved by the department, and shall be conditioned upon the mobile home dealer's complying with the conditions of any written contract made by him in connection with the sale or exchange of any mobile home or recreational vehicle and his not violating any of the provisions of chapters 319 and 320 in the conduct of the business for which he is licensed. The bond shall be to the department and in favor of any person who shall suffer any loss as a result of any violation of the conditions hereinabove contained.
§ 320.77(11), Fla. Stat. (1975).
. Petitioners do contend that there were violations of section 320.27(9) because that subsection allows for the revocation of a dealer's license if the dealer willfully engages in a pattern of fraud. On the facts before us, however, no "pattern" of fraud has been established.