Court Opinion

ID: 4262934
Source: CourtListenerOpinion
Date Created: 2018-04-11 15:10:17.194994+00
Date Added: 2024-06-11T14:30:07.401023
License: Public Domain

Third District Court of Appeal
                                State of Florida

                            Opinion filed April 11, 2018.
          Not final until disposition of timely filed motion for rehearing.

                                ________________

                                 No. 3D17-428
                          Lower Tribunal No. 13-23409
                              ________________

                                  Arvin Peltz,
                                       Appellant,

                                          vs.

              Trust Hospitality International, LLC, et al.,
                                       Appellees.

      An Appeal from the Circuit Court for Miami-Dade County, William Thomas
and Lisa S. Walsh, Judges.

      Arvin Peltz, in proper person.

      Leto | Bassuk, and Larry Bassuk and Brian L. Elstein, for appellees.

Before SUAREZ, SCALES and LINDSEY, JJ.

      SCALES, J.

      Appellant, plaintiff below, Arvin Peltz seeks review of a judgment awarding

attorney’s fees to appellees, defendants below, Trust Hospitality, LLC

(“Hospitality”) and Trust Hospitality International, LLC (“International”)1 based
on appellees’ joint proposal for settlement served on Peltz. We reverse, because

appellees’ joint proposal did not apportion liability between the two offerors as

required by Florida Rule of Civil Procedure 1.442(c)(3).

     I.      RELEVANT FACTS AND PROCEDURAL BACKGROUND

          Peltz, an attorney, sued appellees along with an additional defendant, Tecton

Management Services Company, LLC (“Tecton”), seeking approximately $94,000

in legal fees for services Peltz performed for Tecton. Peltz’s claims against Tecton

were based on open account, account stated, and breach of oral contract. Peltz

claimed that appellees were liable for Tecton’s obligations based on theories of

breach of oral contract, unjust enrichment, and quantum meruit. In the latter

claims, Peltz asserted that appellees “[a]ssumed control over the day to day

operations of TECTON” and that appellees directly and unjustly benefited from

Peltz’s legal work for Tecton.

          Pursuant to rule 1.442 and section 768.69 of the Florida Statutes, appellees

served on Peltz a single, joint proposal for settlement, offering to pay Peltz

$10,001 in full settlement of Peltz’s claims against appellees. Appellees’ proposal,

though, did not apportion between them the amount of the proposal attributable to

each offeror. Peltz rejected the proposal.

1   Collectively, we refer to Hospitality and International herein as “appellees.”

                                             2
          The trial court ultimately entered a final summary judgment in appellees’

favor,2 and appellees then sought to recover their attorney’s fees against Peltz

based on their proposal for settlement. The trial court entered the judgment on

appeal, awarding appellees fees and costs in the amount of $52,760. Peltz timely

appeals this judgment.

    II.      ANALYSIS3

          Section 768.79 of the Florida Statutes provides the substantive basis for the

recovery of attorney’s fees as a sanction for one party’s rejection of another party’s

settlement proposal; and, rule 1.442 provides the procedural framework to

implement the statute’s substantive requirements. See Kuhadja v. Borden Dairy

Co. of Ala., LLC., 202 So. 3d 391, 395 (Fla. 2016). Rule 1.442(c)(3)4 – requiring,

inter alia, that all joint proposals state the amount and terms attributable to each

offeror –implements section 768.79(2)(b)’s requirement that all settlement offers

“[n]ame the party making it and the party to whom it is being made.” Because the

2A different panel of this Court affirmed the final summary judgment on appeal.
See Peltz v. Trust Hospitality, LLC, 3D16-2136 (Fla. 3d DCA Feb. 7, 2018).
3 In determining whether a proposal for settlement comports with rule 1.442 and
section 768.69, we employ a de novo standard of review. See Miami-Dade Cty. v.
Ferrer, 943 So. 2d 288, 290 (Fla. 3d DCA 2006).
4Rule 1.442(c)(3) provides that “[a] proposal may be made by or to any party or
parties and by or to any combination of parties properly identified in the proposal.
A joint proposal shall state the amount and terms attributable to each party.”

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fee-shifting provisions of section 768.79 and rule 1.442 are in derogation of the

common law rule that each party pay its own fees, the statute and rule are strictly

construed. Kuhadja, 202 So. 3d at 394. A proposal for settlement not strictly

conforming to rule 1.442(c)(3)’s apportionment requirement is unenforceable. See

Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So. 2d 276, 279 (Fla. 2003)

(holding that in order for a section 768.79 settlement offer to be valid, “an offer

from multiple plaintiffs must apportion the offer among the plaintiffs” as provided

by rule 1.442(c)(3)).

         Peltz argues that appellees’ joint proposal was invalid, and therefore

unenforceable, because the proposal did not apportion the $10,001 settlement offer

between Hospitality and International, the proposal’s co-offerors, as required by

rule 1.442(c)(3).      Citing to rule 1.442(c)(4)’s5 exception to rule 1.442(c)(3)’s

apportionment requirement, appellees argue that apportionment in their joint

proposal was unnecessary because any liability they may have had for Tecton’s

debt was solely derivative,6 by operation of law.

5   Rule 1.442(c)(4) reads, in its entirety, as follows:

         Notwithstanding subdivision (c)(3), when a party is alleged to be
         solely vicariously, constructively, derivatively, or technically liable,
         whether by operation of law or by contract, a joint proposal made by
         or served on such a party need not state the apportionment or
         contribution as to that party. Acceptance by any party shall be without
         prejudice to rights of contribution or indemnity.
6   “Cases of derivative liability . . . ‘involve wrongful conduct by both the person

                                              4
      Appellees, though, misapprehend rule 1.442(c)(4)’s exception to rule

1.442(c)(3)’s apportionment requirement. In this case, the exception would apply

only if Peltz had alleged that appellees/co-offerors’ liability was exclusively

derivative in nature, i.e., their liability for Tecton’s debt arose by operation of law,

rather than as a result of any act or omission of the offerors.7 As recognized by

rule 1.442(c)(4), apportionment between the co-offerors would be unnecessary in

such a case because, from the liability and damages standpoint of the

appellant/offeree, the co-offerors would be legally indistinguishable.               Cf.

Grobman, 863 So. 2d at 1235 (“The vicariously liable party is responsible to the

plaintiff to the same extent as the primary actor; both are jointly liable for all of the

harm that the primary actor has caused.”).

who is derivatively liable and the actor whose wrongful conduct was the direct
cause of injury to another.’” Grobman v. Posey, 863 So. 2d 1230, 1235-36 (Fla.
4th DCA 2003) (quoting William D. Underwood & Michael D. Morrison,
Apportioning Responsibility in Cases Involving Claims of Vicarious, Derivative,
or Statutory Liability for Harm Directly Caused by the Conduct of Another, 55
Baylor L. Rev. 617, 619 (2003)). “Derivative liability is similar to vicarious
liability in that (1) there is no cause of action unless the directly liable tortfeasor
commits a tort and (2) the derivatively liable party is liable for all of the harm that
such a tortfeasor has caused.” Id. at 1236.
7 By way of example, a vehicle’s owner, despite no active negligence, is, by
operation of law, liable for the torts of a driver permissively using the owner’s
vehicle. See Richbell v. Toussaint, 221 So. 3d 764, 768 (Fla. 4th DCA 2017).
Thus, when an injured plaintiff sues both the owner and operator of a negligently
driven vehicle, the owner and operator may, pursuant to rule 1.442(c)(4)’s
exception, serve the plaintiff with a single, joint, un-apportioned settlement offer.
See Miley v. Nash, 171 So. 3d 145, 149-50 (Fla. 2d DCA 2015).

                                           5
      Peltz’s claims against appellees, though, are direct claims; Peltz alleged that

appellees directly benefited from Peltz’s legal work, and that appellees’ actions

directly induced Peltz to continue performing legal work for the benefit of Tecton

and appellees.   In our de novo review of Peltz’s Amended Complaint, we could

not find any allegations suggesting that appellees were solely derivatively liable for

Tecton’s obligations, as required to implicate rule 1.442(c)(4)’s exception. Indeed,

appellees prevailed in this case because they were not responsible, derivatively or

otherwise, for Peltz’s claims against Tecton. In fact, Peltz may still recover a

judgment against Tecton, despite Peltz’s claims against appellees having been

dismissed. Thus, appellees’ very success in this litigation severely undercuts their

argument that rule 1.442(c)(4)’s apportionment exception applies to their joint

settlement proposal.

      Finally, appellees suggest that, because the damages Peltz sought against

them are not entirely distinct from the damages Peltz still seeks to recover from

Tecton, any liability of appellees to Peltz would be derivative, thereby implicating

rule 1.442(c)(4)’s exception to apportionment.            We find this argument

unpersuasive. As succinctly stated by our sister court, “[t]he focus of the exception

contained in rule 1.442(c)(4) is not whether a party is liable for the full amount of

damages, but rather, it is whether the claims against the party are direct claims or

solely claims of vicarious or other forms of indirect liability.” Saterbo v.

                                          6
Markuson, 210 So. 3d 135, 138 (Fla. 2d DCA 2016) (footnote omitted).

Irrespective of the extent of appellees’ liability, Peltz’s claims against appellees

were direct claims that did not implicate rule 1.442(c)(4)’s exception to the

apportionment requirement.

                                   CONCLUSION

      Peltz’s claims against appellees were direct claims, based on those

appellees’ actions, and were not derivative claims. Therefore, rule 1.442(c)(4)’s

exception to rule 1.442(c)(3)’s apportionment requirement is inapplicable.

Because appellees’ proposal for settlement did not apportion the offer between the

co-offerors, the proposal is unenforceable. We therefore reverse the trial court’s

attorney’s fee judgment for appellees.

      Reversed.

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