Court Opinion

ID: 3177831
Source: CourtListenerOpinion
Date Created: 2016-02-17 16:20:15.250141+00
Date Added: 2024-06-11T07:38:54.298446
License: Public Domain

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING
                      MOTION AND, IF FILED, DETERMINED

                                             IN THE DISTRICT COURT OF APPEAL
                                             OF FLORIDA
                                             SECOND DISTRICT

VERANDAH DEVELOPMENT, LLC,          )
                                    )
           Appellant,               )
                                    )
v.                                  )                  Case No. 2D15-2250
                                    )
VINCENT GUALTIERI and BETH          )
GUALTIERI,                          )
                                    )
           Appellees.               )
___________________________________ )

Opinion filed February 17, 2016.

Appeal from the Circuit Court for Lee
County; Michael T. McHugh, Judge.

Theodore L. Tripp, Jr., and Justin B.
Mazzara of Hahn, Loeser, & Parks, LLP,
Fort Myers, for Appellant.

Kelsey L. Hazzard and William J. Hazzard
of Coleman, Hazzard, & Taylor, P.A.,
Naples, for Appellees.

CASE, JAMES R., Associate Senior Judge.

             Verandah Development, LLC, appeals the final judgment entered in favor

of Vincent and Beth Gualtieri. We affirm the trial court's finding that Verandah was not

entitled to amend the refund policy under its agreement with the Gualtieris. However,
we reverse the final judgment because the Gualtieris did not establish that they were

entitled to an immediate refund.

             I.     Background

             In January 2006, the Gualtieris applied to join the golf club owned by

Verandah Development, LLC, in the residential development where they resided. When

they applied they signed and submitted a Membership Agreement. Under the terms of

the Agreement, Verandah had the absolute discretion to accept or reject the Gualtieris

as members. Paragraph two of the Agreement provided in pertinent part:

             My membership privileges will be subject to the terms and
             conditions of the Club Membership Plan and Rules and
             Regulations, which I acknowledge receipt of (the
             "Membership Plan"). I hereby acknowledge that my
             membership in the Club is not an investment in the Club, nor
             does it provide an equity or ownership interest in the Club or
             the Club Facilities, which are owned solely by [Verandah].
             Membership in the Club does not confer upon me a vested
             or prescriptive right or easement to use the Club Facilities.
             [Verandah] and the Club reserve the right, in their sole and
             absolute discretion, to restrict or to otherwise reserve the
             Club Facilities for maintenance, tournament play and other
             special events from time to time.

Paragraph seven further provided:

             I hereby acknowledge receipt of Verandah Club Membership
             Plan and the Rules and Regulations and agree to be bound
             by the terms and conditions thereof as the same may be
             amended from time to time by the Club or [Verandah] and
             irrevocably agree to fully substitute the membership
             privileges acquired pursuant to the Club Membership Plan
             and Rules and Regulations for any present or prior rights in
             or to use of the Club Facilities.

             The Gualtieris were required to submit a $40,000 deposit with their

application. Had the Gualtieris' application been rejected, the deposit would be

immediately refunded. However, because they were accepted as members, their

                                          -2-
deposit was refundable under Verandah's refund policy for resigned members. The

Agreement provided:

              Members who join the club after 180 days of the date of their
              real estate contract and later resign their membership will be
              refunded their initiation deposit previously paid subject to a
              "one in, one out" refund policy. Under the refund policy, the
              resigned membership will be placed on a resigned waiting
              list for that membership category. The Club will pay a refund
              of the initiation deposit to the first person on the resigned list
              upon every sale of a membership category.1

In 2006, when the Gualtieris joined the Club, the Membership Plan contained a similar

refund policy.2 In 2009, Verandah amended the Membership Plan to provide that the

Club would issue refunds to one resigned member for every three new memberships

issued in a given category. The Club issued an email notifying its members of the

amendment after it became effective. It is undisputed that the Gualtieris did not lodge

an objection to the policy at the time it was implemented. In 2014, the Gualtieris

resigned their membership. After Verandah informed the Gualtieris that they would be

refunded under the amended "three in, one out" policy they filed suit, seeking a refund

of their deposit. Verandah has been issuing refunds under the amended policy during

the pendency of this litigation.

              1
                 The Agreement also provided that "[m]embers who joined the club within
180 days of the date of their real estate contract and later resign[ed] their membership
will be refunded their initiation deposit previously paid within 30 days after resignation,
without having to be placed on any waiting list to receive their refund ('instant
refundability')." The parties are in agreement that the Gualtieris joined the club more
than 180 days of the date of their real estate contract.
              2
               The Membership Plan provided that refunds would be issued to resigned
members on a "two in, one out" basis unless that category of membership was at full
capacity, in which case, Memberships would be issued on a "one in, one out" basis.

                                            -3-
              The parties filed dueling motions for summary judgment. The Gualtieris

argued that the amended refund policy constituted a breach of Agreement. Verandah's

motion argued that under the Agreement, it was authorized to unilaterally amend the

refund policy. The trial court entered a summary final judgment in favor of the

Gualtieris, ordering that Verandah immediately pay $40,000 to them.3

              II.    Analysis

              Verandah raises a number of issues on appeal, but we write to address

two of them.4 Verandah argues that the trial court erred in granting summary judgment

to the Gualtieris because Verandah expressly reserved the right to amend the

Membership Plan, including the refund policy. It also argued that the trial court erred in

granting summary judgment in favor of the Gualtieris because they did not establish that

they were entitled to an immediate payment of the $40,000 membership deposit. We

disagree that Verandah was authorized under the Agreement to amend the refund

policy. However, we reverse because there is no record evidence establishing that the

Gualtieris were entitled to an immediate refund.

              The trial court's interpretation of a contract is a matter of law subject to de

novo review. Syvrud v. Today Real Estate, Inc., 858 So. 2d 1125, 1129 (Fla. 2d DCA

2003). We also apply a de novo review to the trial court's decision to grant summary

judgment. Id. "It is a generally accepted rule of contract law that, where a writing

expressly refers to and sufficiently describes another document, that other document, or

              3
            Verandah also filed a counterclaim on which the trial court granted
summary judgment in favor of the Gualtieris.
              4
             We find no merit in the remaining issues raised by Verandah and decline
to comment further on them.

                                            -4-
so much of it as is referred to, is to be interpreted as part of the writing." Avatar Props.,

Inc. v. Greetham, 27 So. 3d 764, 766 (Fla. 2d DCA 2010) (quoting OBS Co. v. Pace

Constr. Corp., 558 So. 2d 404, 406 (Fla. 1990)). In interpreting the Membership

Agreement and Membership Plan, we first turn to the plain language to discern the

parties' intent. See Hatadis v. Achieva Credit Union, 159 So. 3d 256, 259 (Fla. 2d DCA

2015). "The goal in construing the contract language is to reach a reasonable

interpretation of the entire agreement in order to accomplish its stated purpose and

meaning." Id. "[W]here one interpretation of a contract would be absurd and another

would be consistent with reason and probability, the contract should be interpreted in

the rational manner." Id. (quoting BKD Twenty-One Mgmt. Co. v. Delsordo, 127 So. 3d
527, 530 (Fla. 4th DCA 2012)).

       A.     Verandah was not authorized to amend the refund provision in the
              Membership Agreement.

              Verandah relies on paragraph seven of the Membership Agreement in

arguing that the contract authorized it to amend the refund policy. That paragraph

provides in pertinent part that the Gualtieris agreed

              to be bound by the terms and conditions [of the Membership
              Plan and Rules and Regulations] as the same may be
              amended from time to time by the Club or [Verandah] and
              irrevocably agree to fully substitute the membership
              privileges acquired pursuant to the Club Membership Plan
              and Rules and Regulations for any present or prior rights in
              or to use of the Club Facilities.

(Emphasis added.) Verandah also argues that under the Agreement, the Gualtieris had

no vested rights whatsoever. It relies on the following provision from the Membership

Agreement:

                                            -5-
              Membership in the Club does not confer upon me a vested
              or prescriptive right or easement to use the Club Facilities.
              [Verandah] and the Club reserve the right, in their sole and
              absolute discretion, to restrict or to otherwise reserve the
              Club Facilities for maintenance, tournament play and other
              special events from time to time.

(Emphasis added.)

              We reject these arguments and are persuaded by the reasoning in

Feldkamp v. Long Bay Partners, LLC, 773 F. Supp. 2d 1273, 1282 (M.D. Fla. 2011). In

Feldkamp, a golf club suspended its refund policy and the plaintiff members filed suit

seeking a refund of their deposit. The golf club in that case had a similar arrangement

to Verandah's club—potential members submitted a membership application and

deposit. The membership application provided that members agreed to be bound by

the Membership Plan and the Rules and Regulations "as the same may be amended

from time to time by the Club . . . and irrevocably agree[d] to fully substitute the

membership privileges acquired pursuant to the Club Rules and Regulations for any

present or prior rights in or to use of the Club Facilities." Id. at 1281. The club, like

Verandah, argued that it was entitled to amend the refund policy under this provision.

The court rejected this argument, reasoning that the amendment rights of the club only

pertained to "membership priviliges ('rights in or to use of the Club Facilities') not the

substantive right to a refund." Id. at 1282.

              Contrary to Verandah's arguments, these provisions only pertained to the

Gualtieris' rights in or to use the Club Facilities—the Gualtieris agreed to unilateral

amendments by Verandah pertaining to "any present or prior rights in or to use of the

Club Facilities" and agreed that their membership did not confer a vested right "to use

                                               -6-
the Club Facilities." This language did not permit Verandah to amend the refund policy

contained in the Membership Agreement. Rather, as in Feldkamp,

              "[t]he only reasonable interpretation of [these] provision[s] is
              that [the Club] had the unilateral right to make changes
              which would affect the prior rights in or use of the Club
              Facilities (e.g., changes related to membership dues, Club
              operations and services, guest and family privileges, sale of
              the Club, etc.). Thus, the refund obligation remained a
              vested contractual right, not subject to amendment by the
              Club.

Id. (footnote omitted).

              Verandah argues that Feldkamp is distinguishable because the golf club in

that case attempted to fully suspend the refund policy whereas, in this case, Verandah

has simply changed its administration of issuing refunds by adopting the "three in, one

out" policy. We are unpersuaded by this argument because the severity of the golf

club's breach in Feldkamp is unrelated to the court's de novo interpretation of the

contract.

              Verandah also cites Hamlet Country Club, Inc. v. Allen, 622 So. 2d 1081

(Fla. 4th DCA 1993), in support of its arguments that it was authorized to amend the

refund provision and that the Gualtieris had no vested rights under the Agreement. In

Hamlet, a golf club required a deposit from members for admission. Id. at 1082. The

club's bylaws had conflicting provisions as to whether a member could redeem their

membership certificate when they resigned from the club. Id. One provision provided

that redemption was available only if the club had at least 365 members. Id. Some

members contended that another provision allowed for redemption regardless of how

many members were in the club. Id. The club amended the bylaws to explicitly state

that redemption was only available if the club had 365 members. Id. The Fourth District

                                            -7-
held that the amendment was authorized because the right of redemption was governed

by and subject to the bylaws. Id. at 1083.

              However, Hamlet is distinguishable from this case. In Hamlet, the

redemption rights were contained in the bylaws that were subject to amendment. The

Hamlet court relied on Orchard Ridge Country Club, Inc. v. Schrey, 470 N.E.2d 780,

783 (Ind. Ct. App. 1984), where the court found the rights at stake were "qualified from

the outset." The Hamlet court also distinguished First Florida Bank, N.A. v. Financial

Transaction Systems, Inc., 522 So. 2d 891, 892 (Fla. 2d DCA 1988), where this court

reaffirmed the well-established principle that "a corporation is prohibited from amending

its bylaws so as to impair a member's contractual right." The Hamlet court reasoned:

"We find [First Florida Bank] distinguishable because the corporation was attempting to

change contractual rights emanating from its charter by altering the bylaws. In the

present case the alleged vested rights are all contained in the bylaws which were

subject to amendment." Hamlet, 622 So. 2d at 1083. Accordingly, we find that

Verandah's amendment to the refund policy was impermissible under the Agreement.

       B.     Summary judgment was improper because the Gualtieris did not
              establish their entitlement to an immediate refund.

              While we agree with the trial court that Verandah was not authorized

under the Agreement to amend the refund policy, the record before this court does not

establish that the Gualtieris were entitled to an immediate refund of their deposit. The

only evidence in the record as to where the Gualtieris stood on the resignation list is the

affidavit of the club's general manager, Kenneth Congdon II. Mr. Congdon's affidavit

provided that the Gualtieris were twenty-ninth on the list as of March 2015.

                                             -8-
             The Gualtieris argue that they were entitled to an immediate refund

because Verandah breached the Agreement by administering the resignation list under

the amended "three in, one out" policy as opposed to the original "one in, one out"

policy. We recognize that "[a] material breach by one party may be considered a

discharge of the other party's obligations thereunder." Nacoochee Corp. v. Pickett, 948
So. 2d 26, 30 (Fla. 1st DCA 2006). However, an immediate refund places the Gualtieris

in a better position than they would have been if the "one in, one out" policy had been

honored.

             [T]he purpose of damages is to restore an injured party to
             the same position that he would have been in had the other
             party not breached the contract. In restoring the injured
             party to the "same position," he "is not entitled to be placed,
             because of that breach, in a position better than that which
             he would have occupied had the contract been performed."

Lindon v. Dalton Hotel Corp., 49 So. 3d 299, 305 (Fla. 5th DCA 2010) ((citations

omitted) (quoting Madison Fund, Inc. v. Charter Co., 427 F. Supp. 597, 608 (S.D.N.Y.

1977)). The Gualtieris will not suffer damages until the point in time when they would

have been due for a refund under the original refund policy. Verandah's refund policy

amendment and communications with the Gualtieris regarding their refund are best

characterized as anticipatory repudiations. See Alvarez v. Rendon, 953 So. 2d 702,

709 (Fla. 5th DCA 2007) ("An anticipatory breach of contract occurs before the time has

come when there is a present duty to perform as the result of words or acts evincing an

intention to refuse performance in the future."). Accordingly, we reverse the judgment

insofar as it awards immediate damages to the Gualtieris and remand to the circuit court

for further proceedings to determine when the Gualtieris would be entitled to a refund.

             Affirmed in part, reversed in part, and remanded.

                                           -9-
VILLANTI, C.J., and LaROSE, J., Concur.

                                      - 10 -