Court Opinion

ID: 5141358
Source: CourtListenerOpinion
Date Created: 2021-12-29 17:03:11.311297+00
Date Added: 2024-06-11T08:24:28.811495
License: Public Domain

Third District Court of Appeal
                               State of Florida

                      Opinion filed December 29, 2021.
       Not final until disposition of timely filed motion for rehearing.

                            ________________

                              No. 3D21-125
                       Lower Tribunal No. 19-13301
                          ________________

                GE Real Estate Services, Inc.,
       d/b/a Keller Williams Realty Premier Properties,
                                  Appellant,

                                     vs.

               Mandich Real Estate Advisors, Inc.,
                                  Appellee.

     An Appeal from the Circuit Court for Miami-Dade County, Peter R.
Lopez, Judge.

     Douglas H. Stein, P.A., and Douglas H. Stein, for appellant.

      Haber Law, P.A., and David B. Haber and Ariella Gutman, for
appellee.

Before LOGUE, HENDON, and LOBREE, JJ.

     HENDON, J.
        GE Real Estate Services, Inc., d/b/a Keller Williams Realty Premier

Properties (“KW”) appeals from the trial court’s dismissal with prejudice of

its second amended complaint against Mandich Real Estate Advisors, Inc.

(“Mandich”). We affirm.

Facts

         Fred Afif (“Afif”) and Louis Erice (“Erice”) are licensed real estate

agents who were employed by KW. George Smith (“Smith”) is a Florida

licensed real estate broker, formerly affiliated with Miami New Realty

(“MNR”) and Multifamily Real Estate Group, Inc. (“MREG”). In January

2017, Afif, Erice, and Smith entered into a Commission and Non-

Circumvent Agreement (“Commission Agreement”) whereby Afif and Erice

would procure purchasers of hotel properties, Smith would procure sellers

of hotel properties, and they would split the real estate commissions. The

Commission Agreement contained a “non-circumvent” provision that

provided that neither KW nor Smith on their own could enter into sales

agreements and cut the other out of the commission.1 The Commission

1   The provision states:
       4. Non-Circumvent. The parties acknowledge that the sale or
       purchase of property by a Protected Party is a business
       opportunity to all parties. Therefore, the parties agree not to
       circumvent, avoid, or bypass, directly or indirectly, each other for
       the purpose of avoiding payment of the Commission by entering
       into any agreement for the sale and purchase of property with,

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Agreement specifically referred to the River Park Hotel and Suites, Miami,

Florida, as the only asset under consideration for sale or lease by Afif, who

was the only broker involved in full negotiation with the buyer and seller.

After the Commission Agreement was executed, Afif introduced Smith to

his client, who did business through their wholly owned corporation,

Sanctuary Resort and Marina, LLC (“Buyers”). The sale of the River Park

Hotel property did not close.

     Over a year later, around March of 2018, Smith, acting as broker,

identified another hotel opportunity for the Buyers to purchase, the Sands

Harbor Resort and Marina property (“Sands Harbor”). On March 23, 2018,

Smith formed a new corporation, Mandich.         On May 10, 2018, Smith

became the qualifying broker for that company when it became licensed as

a brokerage company by the Florida Department of Professional

Regulation. On May 11, 2018, Smith and the Buyers entered into a

     or to a Protected Party that does not include the payment of the
     Commission. In the event a party circumvents the other in
     breach of this paragraph, the non-breaching party shall be
     entitled to a Commission in the amount of 50% percent of the
     total AMOUNT OF COMMISSION for the Protected Party's
     property, with said 50% percent Commission being agreed
     upon as liquidated damages for the failure of the breaching
     party to perform the duties, liabilities and obligations imposed
     upon it by this Agreement. The parties acknowledge that this
     liquidated damages provision is acceptable because of the
     difficulty, inconvenience and uncertainty of ascertaining actual
     damages.

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Broker’s Fee Agreement, whereby the Buyers agreed to pay Smith a flat

fee of $75,000 identified as a “finder’s fee,” not a “commission,” for his

services related to identifying the property and its sellers, subject to the

transaction closing. No commission was otherwise agreed upon under the

terms of the Broker’s Fee Agreement. It is important to note that when

Smith and the Buyers entered into the Broker’s Fee Agreement, Smith was

still affiliated with MREG.

      In October 2018, the Sands Harbor property transaction closed, and

the Buyers disbursed the $75,000 finder’s fee to Mandich, Smith’s current

brokerage company.

      Afif and Erice, individually, and KW sued Smith, individually, and

Mandich for breach of the Commission Agreement, and for civil conspiracy,

seeking damages as a result of the Sands Harbor sale. Count 1 alleged

that upon accepting Smith as its Director and Broker, Mandich assumed

the obligations of the Commission Agreement. The complaint further

alleged that Mandich breached the non-circumvent provision of the

Commission Agreement by excluding KW, Afif, and Erice from the Sands

Harbor negotiations and the Broker’s Fee Agreement. The civil conspiracy

count alleged that Smith and Mandich conspired to defraud KW, Afif, and

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Erice by excluding them from the negotiations and the Sands Harbor

finder’s fee.

      Smith and Mandich moved to dismiss the complaint. At the hearing,

the trial court recognized that Afif and Erice were voluntarily dropped as

parties, leaving KW as the sole plaintiff. The trial court then concluded that

the breach of contract count against Mandich must be dismissed with

prejudice because Mandich was not a party to the Commission Agreement.

The court further dismissed the civil conspiracy count without prejudice and

with leave to amend. The trial court specifically stated that it was possible

for KW to state a cause of action for civil conspiracy only if it could show

that Mandich had knowledge of the Commission Agreement and agreed to

circumvent it.

      KW filed its Second Amended Complaint. The only counts relevant to

this appeal are the counts against Mandich for tortious interference with a

contractual or business relationship, and against Mandich (and the Buyers)

for civil conspiracy. After a hearing, the trial court dismissed all of KW’s

claims against Mandich with prejudice and denied KW’s motion for re-

hearing.

      Examining de novo the allegations of KW’s amended complaint, we

conclude that KW’s claim of tortious interference against Mandich, based

                                      5
on a theory of imputed knowledge of the Commission Agreement, fails as a

matter of law. People’s Trust Ins. Co. v. Alonzo-Pombo, 307 So. 3d 840,

842 (Fla. 3d DCA 2020) (holding a dismissal for failure to state a cause of

action is reviewed de novo); United Auto. Ins. Co. v. Law Offices of Michal

I. Libman, 46 So. 3d 1101, 1103 (Fla. 3d DCA 2010) (holding a motion to

dismiss for failure to state a cause of action admits all well pleaded facts as

true, as well as reasonable inferences that may arise from those facts). In

this instance, the trial court correctly concluded that further opportunities to

amend the complaint would be futile. See Broz v. R.E. Reece, 272 So. 3d

512 (Fla. 3d DCA 2019).

      A claim for tortious interference with the Commission Agreement

required KW to set forth four elements in its complaint against Mandich: 1)

the existence of a business relationship between KW and a third person, in

this case, Smith, under which KW has legal rights, 2) Mandich’s knowledge

of the relationship, 3) Mandich’s intentional and unjustified interference with

the relationship that induced or otherwise caused Smith not to perform his

obligation under the Commission Agreement with KW, and 4) damage to

KW resulting from Smith’s failure to perform. See DNA Sports Performance

Lab, Inc. v. Club Atlantis Condo. Ass'n, 219 So. 3d 107, 110 (Fla. 3d DCA

2017). KW was unable, despite a number of opportunities to amend its

                                       6
complaint, to plead facts that would show Mandich intentionally and

unjustifiably interfered with the Commission Agreement resulting in

damage to KW, i.e., KW’s exclusion from the Broker’s Fee Agreement

executed by Smith and the Buyers, to which agreement Mandich was not a

party.

         Further, the Commission Agreement was executed prior to Mandich’s

existence as a commercial entity and under Florida law, contracts entered

into by a real estate agent on behalf of a former do not automatically

transfer to, or impute knowledge of prior agreements to, a new brokerage

company simply because the agent joined the new brokerage company.2

See Marks v. M.S.F. Mgmt. Corp., 540 So. 2d 138, 140 (Fla. 5th DCA

1989) (holding the new broker never acquired any interest in the

commission agreement because it was not the employing broker when

plaintiff’s services were performed). The usual rule provides that a contract

cannot bind one who is not a party to it or has not in some way agreed to

accept its terms. To create a valid contract there must be reciprocal assent

to a certain and definite proposition. CH2M Hill Se., Inc. v. Pinellas Cnty,

598 So. 2d 85, 89 (Fla. 2d DCA 1992) (citing In re Estate of Donner, 364

2 Real estate salesmen are prohibited from operating without brokers;
commission agreements made by salesmen are enforceable by the broker
who is their employer at the time the services entitling the salesman to
compensation are rendered. Marks, 540 So. 2d at 140 (citations omitted).

                                      7
So. 2d 742 (Fla. 3d DCA 1978)). The trial court repeatedly charged KW

with amending its complaint to allege some direct knowledge and

purposeful interference by Mandich, and KW was unable to do so, thereby

failing to fulfill elements of the cause of action for intentional interference.

       KW’s claim against Mandich for civil conspiracy similarly fails. KW

alleges that Mandich knew of the prior Commission Agreement between

Afif and Erice (working for KW) and Smith (working with MNR/MREG) and

intentionally conspired with Smith and the Buyers to circumvent the

Commission Agreement by agreeing with Smith to execute the Broker’s

Fee Agreement with the Buyer, and by passively accepting the

contractually agreed finder’s fee from the Buyer once the Sands Harbor

sale closed. KW alleges it is entitled to payment of its share of the finder’s

fee for the Sands Harbor purchase by virtue of its rights under the prior

Commission Agreement for the River Park Hotel, which sale never closed.

We disagree.

      In Florida, “[a] civil conspiracy requires: (a) an agreement between

two or more parties, (b) to do an unlawful act or to do a lawful act by

unlawful means, (c) the doing of some overt act in pursuance of the

conspiracy, and (d) damage to plaintiff as a result of the acts done under

the conspiracy.” Raimi v. Furlong, 702 So. 2d 1273, 1284 (Fla. 3d DCA

                                        8
1997). “General allegations of conspiracy are inadequate.” World Class

Yachts, Inc. v. Murphy, 731 So.2d 798, 799 (Fla. 4th DCA 1999). A

complaint must “set forth clear, positive, and specific allegations of civil

conspiracy.” See id. Smith’s allegedly tortious actions – procuring a ready

and willing buyer, executing the Broker’s Fee Agreement with the Buyer,

and failing to include Afif and Erice in the deal – occurred prior to his

employment with Mandich.        Smith’s allegedly tortious acts cannot be

imputed to Mandich, which entity was not a party to either the Commission

Agreement or the Broker’s Fee Agreement. Mandich cannot be found liable

for civil conspiracy merely by passively accepting a finder’s fee. “To

assume or speculate . . . that the [appellees] participated in a conspiracy . .

. merely because they ultimately received some benefits from the

[investments] is insufficient for the imposition of liability against them.”

Raimi, 702 So. 2d at 1285; Eagletech Commc'ns, Inc. v. Bryn Mawr Inv.

Grp., Inc., 79 So. 3d 855, 863 (Fla. 4th DCA 2012). As Mandich was not a

party to the Commission Agreement, and that agreement is unrelated to

the sale of the Sands Harbor property, KW has not properly alleged

damages as against Mandich. We make no determination regarding the

issue of KW’s damages for any tort committed by Smith individually and

prior to his employment with Mandich.

                                      9
     We thus affirm the trial court’s dismissal with prejudice of the tortious

interference and conspiracy counts against Mandich, after KW’s repeated

failure to amend the complaint to state those causes of action as against

Mandich.

     Affirmed.

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