Title: Bitterman v. Bitterman
Citation: 714 So. 2d 356
Docket Number: 90074, 90075
State: Florida
Issuer: Florida Supreme Court
Date: March 26, 1998

714 So. 2d 356 (1998)
Stephan BITTERMAN, et al., Petitioners,
v.
Anette BITTERMAN, Respondent.
Stephan BITTERMAN, et al., Petitioners,
v.
Patrick H. WEIDENBENNER, Respondent.
Nos. 90074, 90075.

Supreme Court of Florida.
March 26, 1998.
Rehearing Denied July 17, 1998.
*357 John Beranek of Ausley &amp; McMullen, Tallahassee, and Nancy Little Hoffmann, Fort Lauderdale, for Petitioners.
John R. Hargrove and W. Kent Brown, Fort Lauderdale, and Peter Matwiczyk and Benjamin P. Brown, of Henrich, Gordon, Hargrove, Weihe &amp; James, P.A., Palm Beach; and Brian B. Joslyn and Ronald E. Crescenzo of Boose, Casey, Ciklin, Lubitz, Martens, McBane &amp; O'Connell, West Palm Beach, for Respondents.
*358 Robert W. Goldman, Naples, for The Real Property, Probate &amp; Trust Law Section of The Florida Bar, Amicus Curiae.
HARDING, Justice.
We have for review Bitterman v. Bitterman, 685 So. 2d 861 (Fla. 4th DCA 1996),[1] which expressly and directly conflicts with Williams College v. Bourne, 656 So. 2d 622 (Fla. 5th DCA 1995) (Williams College II), and Williams College v. Bourne, 670 So. 2d 1118 (Fla. 5th DCA 1996) (Williams College III.) We have jurisdiction pursuant to article V, section 3(b)(3) of the Florida Constitution.
The conflict between Bitterman and the Williams College cases arises out of the application of section 733.617, Florida Statutes (1993), a section of the Probate Code, which was amended by the legislature in 1993. Prior to that time, the compensation for both personal representatives and attorneys for personal representatives was covered by section 733.617.[2] The 1993 amendment created a new section, after which the compensation for personal representatives was covered by section 733.617 and the compensation for attorneys of personal representatives was covered by newly created section 733.6171. In addition, section 733.6171(7) allowed an attorney to recover costs for the time expended by the attorney seeking reasonable compensation for his or her services on behalf of the personal representative (fees on fees).[3]
Chapter 93-257, section 18, of the 1993 Laws of Florida, the act which created the amendment, states: "[T]his act shall take effect October 1, 1993, and shall be applicable to all decedents, including settlors of revokable inter vivos trusts, dying on or after that date." Section 733.6171(8) further provides:
§ 733.6171(8), Fla. Stat. (1993).
The two district courts are in conflict as to the applicability of the 1993 changes to estates which were pending at the time of the change. The facts of Bitterman, as stated by the district court, are as follows:
[Note 3:] The record shows that Stephan Bitterman obtained an "eleventh hour" continuance of the first fee hearing and thereafter, in the two months that followed, filed approximately 35 pleadings which necessitated a response from Matwiczyk.
685 So. 2d  at 862-65 (footnotes 1 and 2 omitted).
The Fourth District Court of Appeals affirmed the probate court's judgment, which granted additional fees to Matwiczyk and Boose, Casey for their efforts in collecting their attorney's fees. Both the probate court and the district court supported the award of additional fees for three reasons. First, both courts relied on section 733.6171(7). The district court concluded that the administration of Bitterman's estate was covered by 733.6171 (the 1993 amendment) rather than 733.617. The district court reasoned that the proceeding in question commenced in the probate court in March 1993, was tried in August 1993, and was concluded in December 1993, and was therefore within the purview of section 733.6171(8). Second, both the probate court and the district court concluded that Boose, Casey was entitled to additional fees based on section 57.105, Florida Statutes (1993), which enables prevailing parties to collect attorney's fees from losing parties when a court finds that no justiciable issue was raised by the losing party.[4] Finally, both the probate court and the district court concluded that Matwiczyk and Boose, Casey were entitled to the additional fees based on In re Estate of DuVal, 174 So. 2d 580 (Fla. 2d DCA 1965). The district court cited the following from DuVal to support its conclusion:
Bitterman, 685 So. 2d  at 866 (emphasis omitted) (quoting In re Estate of DuVal, 174 So. 2d 580, 587 (Fla. 2d DCA 1965)). The district court also awarded appellate attorney's fees to Matwiczyk and Boose, Casey, presumably for the same three reasons.
The Williams College cases stem out of the administration of the estate of Robert Rosenburg. *362 The facts, as described by the district court in Williams College III, are as follows:
On October 1, 1993, prior to the release of the opinion in Williams College I, a new section added to the Probate Code took effect. Under section 733.6171, Florida Statutes (1993), compensation for attorneys of personal representatives was to be calculated by taking into account two components: (1) the hours worked by the attorney and (2) the value of the decedent's estate. It also provided that fees of the attorney for the personal representative for litigating his own compensation were chargeable against the estate. § 733.6171(7), Fla. Stat. (1993). The effect of these provisions was to undo the holding of In re Estate of Platt, 586 So. 2d 328, 336 (Fla.1991).
670 So. 2d  at 1119-20 (footnotes omitted).
As it had done in Williams College II, the district court in Williams College III again refused to apply the 1993 changes to the estate at issue.
Bitterman can be distinguished from the Williams College cases based on the different dates of discharge in the two cases. It could be argued that based on the effective date language of section 733.6171(8), the 1993 changes should be applied to Bitterman because the order of discharge in that case was entered in December 1993, after the October 1, 1993, effective date of section 733.6171(8) ("This section shall apply to estates in which an order of discharge has not been entered prior to its effective date but not to those estates in which attorney's fees have previously been determined by order of court after notice"). This is in contrast to the Williams College cases, where the order of discharge was issued in May of 1991, prior to the 1993 effective date.
However, the two districts are still in conflict over the issue of the point in time when the substantive right to collect attorney's fees vests. The resolution of this conflict is determinative of this case.
We resolve this conflict in favor of the Williams College cases. We adopt the following reasoning of the Fifth District Court of Appeal:
670 So. 2d  at 1120-21 (footnotes omitted).
By applying this principle to Bitterman, it becomes clear that Matwiczyk and Boose, Casey had the right to recover attorney's fees incurred in the representation of Irving Bitterman's estate from the moment this representation commenced. Thus, Matwiczyk and Boose, Casey's rights to receive fees, and any corresponding obligation of the estate to pay those fees, was legally vested at the moment Matwiczyk and Boose, Casey began their representation of the estatein 1992. The effective date of section 733.6171 was October 1, 1993. By applying section 733.6171 to compensate Matwiczyk and Boose, Casey, the probate court and district court retrospectively enhanced the obligation of Irving Bitterman's estate. Because this retrospective enhancement is improper, section 733.6171 cannot apply to Bitterman's estate. The 1993 changes can only be applied to cases for which the legal right to attorney's fees vests on or after October 1, 1993.
Based on this conclusion, it also becomes clear that fees recovered by Boose, Casey based on section 57.105 are not justified in this case. As this Court stated in Whitten v. Progressive Casualty Insurance Co., 410 So. 2d 501, 505 (Fla.1982), section 57.105 fees can only be awarded in cases where there is "a complete absence of a *365 justiciable issue of either law or fact raised by the losing party." Due to the uncertainty of the application of the 1993 changes, it cannot be said that the claims raised by Stephen Bitterman completely lacked any justiciable issue.
Nevertheless, we feel that Matwiczyk and Boose, Casey are entitled to the fees that the trial court and district court awarded in this case, based on the inequitable conduct doctrine. The inequitable conduct doctrine permits the award of attorney's fees where one party has exhibited egregious conduct or acted in bad faith. Attorney's fees based on a party's inequitable conduct have been recognized by other courts in this country. See Vaughan v. Atkinson, 369 U.S. 527, 530-31, 82 S. Ct. 997, 8 L. Ed. 2d 88 (1962) (awarding attorney's fees based on respondent's "recalcitrance" and "callous" attitude); Rolax v. Atlantic Coast Line R.R. Co., 186 F.2d 473, 481 (4th Cir.1951) (holding that attorney's fees were justified because "plaintiffs of small means have been subjected to discriminatory and oppressive conduct by a powerful labor organization"). We note that this doctrine is rarely applicable. It is reserved for those extreme cases where a party acts "in bad faith, vexatiously, wantonly, or for oppressive reasons." Foster v. Tourtellotte, 704 F.2d 1109, 1111 (9th Cir.1983) (quoting F.D. Rich Co. v. United States ex rel. Industrial Lumber Co., 417 U.S. 116, 129, 94 S. Ct. 2157, 2165, 40 L. Ed. 2d 703 (1974)). "Bad faith may be found not only in the actions that led to the lawsuit, but also in the conduct of the litigation." Dogherra v. Safeway Stores, Inc., 679 F.2d 1293, 1298 (9th Cir.1982) (quoting Hall v. Cole, 412 U.S. 1, 15, 93 S. Ct. 1943, 1951, 36 L. Ed. 2d 702 (1973)). This Court and other courts in this state have recognized that attorney's fees can be awarded in situations where one party has acted vexatiously or in bad faith. See Florida Patient's Compensation Fund v. Rowe, 472 So. 2d 1145, 1148 (Fla.1985) ("This state has recognized a limited exception to this general American Rule in situations involving inequitable conduct."); Hilton Oil Transport v. Oil Transport Co., 659 So. 2d 1141, 1153 (Fla. 3d DCA 1995); In re Estate of DuVal, 174 So. 2d 580, 587 (Fla. 2d DCA 1965). Based on the facts of the case, we find that Stephen Bitterman's conduct was the type of conduct for which the inequitable conduct doctrine was intended to apply. Therefore, we approve of the award of fees, both by the probate court and the district court, to Matwiczyk and Boose, Casey.
Accordingly, we approve the result of the district court's decision in Bitterman, although we disapprove of that court's reasoning to the extent that it is inconsistent with the Williams College cases and our reasoning here.
It is so ordered.
KOGAN, C.J., OVERTON, SHAW, WELLS and ANSTEAD, JJ., and GRIMES, Senior Justice, concur.
[1]  The district court's opinion addressed two separate appeals, Bitterman v. Bitterman and Bitterman v. Weidenbenner. We have consolidated the two review proceedings for disposition by one opinion.
[2]  Section 733.617, Florida Statutes (1991), entitled "Compensation of personal representatives and professionals," states in relevant part:

(1) Personal representatives, attorneys, accountants, and appraisers and other agents employed by the personal representative shall be entitled to reasonable compensation. Reasonable compensation may include compensation for the services of the agents or employees of the person seeking compensation and may also include reimbursement of out-of-pocket costs.
[3]  Section 733.6171(7), Florida Statutes (1993), provides:

Court proceedings to determine compensation, if required, are a part of the estate administration process, and the costs, including fees for the personal representative's attorney, shall be determined by the court and paid from the assets of the estate. The court shall direct from which part of the estate they shall be paid.
[4]  Section 57.105, Florida Statutes (1993), states in relevant part:

(1) The court shall award a reasonable attorney's fee to be paid to the prevailing party in equal amounts by the losing party and the losing party's attorney in any civil action in which the court finds that there was a complete absence of a justiciable issue of either law or fact raised by the complaint or defense of the losing party; provided, however, that the losing party's's attorney is not personally responsible if he has acted in good faith, based on the representations of his client. If the court finds that there was a complete absence of a justiciable issue of either law or fact raised by the defense, the court shall also award prejudgment interest.