Court Opinion

ID: 4571166
Source: CourtListenerOpinion
Date Created: 2020-09-30 14:03:37.002137+00
Date Added: 2024-06-11T13:30:06.719375
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                            FOURTH DISTRICT

                             GABRIJI, LLC,
                               Appellant,

                                    v.

                       HOLLYWOOD EAST, LLC,
                             Appellee.

                             No. 4D19-3495

                          [September 30, 2020]

   Appeal from the Circuit Court for the Seventeenth Judicial Circuit,
Broward County; Carol-Lisa Phillips, Judge; L.T. Case No. CACE-19-
008594 (25).

   George Harder of Harder Law, Lutz, for appellant.

   Brigid F. Cech Samole of Greenberg Traurig, P.A., Miami, for appellee.

KUNTZ, J.

   Gabriji, LLC appeals the circuit court’s final order dismissing with
prejudice its amended complaint against Hollywood East, LLC. Based on
the four corners of the amended complaint, we agree the court erred and
reverse.

                              Background

   Gabriji entered into a purchase agreement with the seller-developer,
Hollywood Station Investments, LLC, to purchase one condominium unit
in HSI’s proposed building. The purchase agreement provided deposit
amounts for Gabriji to pay at set times. It also stated that HSI would use
Gabriji’s deposits in excess of 10% of the purchase price to fund the
construction and development of the condominium. Based on the
purchase agreement, Gabriji paid $87,425 toward construction of the
condominium.

   At some point after execution of the agreement, the developer stopped
developing the property as a condominium and developed it as rental
apartments.
   In different litigation, a third party, LB Construction of South Florida,
Inc., sued to foreclose a lien on HSI’s debts. LB Construction did not name
Gabriji or serve it with the foreclosure complaint. LB Construction’s suit
led to a foreclosure sale at which Hollywood East bought the property.

   Returning to this case, Gabriji’s lawsuit against Hollywood East sought
a declaration that the foreclosure of the lien in LB Construction’s lawsuit
did not extinguish its interest in the condominium. Gabriji also sought
declarations determining whether: it was a buyer or investor; LB
Construction’s foreclosure judgment was void as to Gabriji; Hollywood
East could enforce the purchase agreement against Gabriji if it was not a
party to it; and Gabriji was entitled to an equitable lien.

   Hollywood East moved to dismiss Gabriji’s amended complaint.
Attached to the motion to dismiss were filings from an earlier lawsuit
Gabriji filed against HSI. 1 Those attachments suggest Hollywood East
intervened in the suit against HSI. They also suggest the court in the
earlier case denied Gabriji’s motion to amend that complaint, motion to
add Hollywood East as a party, and request to file a lis pendens.

   Hollywood East relied on those documents in its motion to dismiss in
this case. It argued Gabriji’s amended complaint was nearly identical in
both cases. It also argued (1) the court’s order in Gabriji’s earlier suit
procedurally and substantively barred the amended complaint in this
case; (2) the amended complaint failed to adequately plead the elements of
an equitable lien; and (3) the claim for an equitable lien was barred by the
statute of limitations.

  After a hearing, the court granted the motion to dismiss in an
unelaborated order.

                                  Analysis

    i. The Court Erred When it Looked Beyond the Four Corners of the
          Complaint in Dismissing Based on Collateral Estoppel

    First, we address Gabriji’s argument that the circuit court erred when
it looked beyond the four corners of the amended complaint in considering

1 The only reference to this lawsuit in the amended complaint is an allegation
that “HSI failed to perform and [Gabriji] initiated a lawsuit against HSI on
January 4, 2017.” But neither the cause of action nor the disposition of that
lawsuit was mentioned.

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Hollywood East’s motion to dismiss. Gabriji argues the court decided the
merits of Hollywood East’s affirmative defenses based on documents not
referenced in or attached to the operative pleading. On this point, we agree
with Gabriji.

    When considering a motion to dismiss, a court is limited to the four
corners of the complaint. Wallisville Corp., Inc. v. McGuinness, 154 So. 3d
501, 503 (Fla. 4th DCA 2015) (citation omitted). The court may rule on
affirmative defenses if allegations supporting the affirmative defenses
appear on the face of the complaint. Doe No. 3 v. Nur-Ul-Islam Acad., Inc.,
217 So. 3d 85, 87 (Fla. 4th DCA 2017) (citation omitted). But if allegations
supporting the affirmative defense do not appear within the four corners
of the complaint, the court cannot consider the affirmative defense when
deciding a motion to dismiss. Id. (citation omitted); see also Barbado v.
Green & Murphy, P.A., 758 So. 2d 1173, 1174 (Fla. 4th DCA 2000).

   The first affirmative defense at issue is collateral estoppel.

   To dismiss based on collateral estoppel, the court relied on issues
arising in the earlier lawsuit Gabriji filed against HSI. Hollywood East
argued Gabriji raised the same issues and asserted the same claims in
that suit. But there was only one reference to that suit in Gabriji’s
amended complaint in this case. Gabriji’s amended complaint mentioned
neither the causes of action it asserted nor the court’s disposition of the
case.

     Hollywood East acknowledges that a court generally may not look
beyond the four corners of the complaint but still argues that Gabriji’s
“gamesmanship” warrants dismissal under these facts. In support of the
argument, Hollywood East relies on Metropolitan Casualty Insurance Co. v.
Tepper, 969 So. 2d 403 (Fla. 5th DCA 2007). In Tepper, the Fifth District
held that the appellant waived its argument—that the trial court erred in
looking beyond the four corners of the appellee’s complaint—because there
was no sign that the appellant raised it in the circuit court. Id. at 405.
The court also noted that the appellant did not dispute the facts relevant
to resolution of the motion to dismiss. Id. The court held that “[a] trial
court is not bound by the four corners of the complaint where the facts are
undisputed and the motion to dismiss raises only a pure question of law.”
Id. (citing Ground Improvement Techniques, Inc. v. Merchants Bonding Co.,
707 So. 2d 1138 (Fla. 5th DCA 1998)).

  Here, the parties do dispute the facts, and Tepper is distinguishable.
The four corners of Gabriji’s amended complaint contained insufficient

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allegations for the court to reach the merits of the collateral estoppel
affirmative defense.

             ii. Gabriji Pleaded a Claim for Equitable Lien

   Next, we address the court’s conclusion that Gabriji failed to adequately
plead a claim for equitable lien in the amended complaint.

    A court may impose an equitable lien to prevent unjust enrichment.
Tribeca Lending Corp. v. Real Estate Depot, Inc., 42 So. 3d 258, 262 (Fla.
4th DCA 2010) (citing Plotch v. Gregory, 463 So. 2d 432, 436 n.1 (Fla. 4th
DCA 1985)). It is “‘a right granted by a court of equity, arising by reason
of the conduct of the parties affected which would entitle one party as a
matter of equity to proceed against’ certain property.” Della Ratta v. Della
Ratta, 927 So. 2d 1055, 1059 (Fla. 4th DCA 2006) (quoting Epstein v.
Epstein, 915 So. 2d 1272, 1275 (Fla. 4th DCA 2005)). “Such a lien ‘may
be declared by a court of equity out of general considerations of right and
justice as applied to the relations of the parties and the circumstances of
their dealings.’” Id. (quoting Plotch, 463 So. 2d at 436).

   Hollywood East argues Gabriji failed to plead a claim for unjust
enrichment. But unjust enrichment and an equitable lien are two distinct
claims. See id. at 1060. Unjust enrichment is an implied contract action
arising at law, id. at 1060 n.1, while an equitable lien is an action in equity
when no adequate remedy exists at law, Jones v. Carpenter, 106 So. 127,
128–29 (Fla. 1925).

   Gabriji’s amended complaint alleged that Hollywood East was unjustly
enriched by accepting Gabriji’s improvements to the land with the prior
owner’s consent. Gabriji alleged that it was a buyer of property and paid
monetary deposits used to develop the property. But Gabriji did not
receive a return of the deposit or the property. Hollywood East later
acquired title to the property through a foreclosure action, but Gabriji was
not a party to the foreclosure suit.

    In Delbros Machine & Tool Co. v. Board of Trustees of the Internal
Improvement Fund of State, 512 So. 2d 1131 (Fla. 4th DCA 1987), this
Court addressed a somewhat analogous situation. There, the plaintiff was
a tenant in possession of real property that made improvements to the
property under an alleged agreement with the landlord that the landlord
would compensate it. Id. at 1132. The defendant acquired the property
through a statutory forfeiture proceeding, but the plaintiff was not joined
in that action. Id. The plaintiff’s complaint sought an equitable lien and
other equitable relief against the defendant. Id. at 1131. On appeal, we

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concluded that the complaint stated a cause of action for equitable relief.
Id. at 1132 (citations omitted).

   As in Delbros, Gabriji alleged that Hollywood East was unjustly
enriched, Gabriji’s funds were used to make improvements to the property,
Hollywood East now owns that property, and Gabriji’s interest was not
foreclosed.

    “A circumstance justifying the imposition of an equitable lien exists
‘when the claimant has furnished funds for the improvement of land with
the knowledge and consent of the owner.’” Plotch, 463 So. 2d at 436
(quoting Wagner v. Roberts, 320 So. 2d 408, 410 (Fla. 2d DCA 1975)).
While Hollywood East argues it was not in privity of contract with Gabriji,
our review is limited to the four corners of Gabriji’s amended complaint.
In the amended complaint, Gabriji alleged that Hollywood East was trying
to enforce certain portions of the purchase agreement against it. Accepting
those allegations as true, Gabriji adequately pleaded a claim for equitable
lien.

  iii.   The Claim for Equitable Lien was not Barred by a One-Year
                        Statute of Limitations

    Lastly, Hollywood East argues Gabriji’s equitable lien claim was barred
by the applicable statute of limitations. It argues the statute of limitations
for “[a]n action to enforce an equitable lien arising from the furnishing of
labor, services, or material for the improvement of real property” is one
year. See § 95.11(5)(b), Fla. Stat. (2019).

    Accepting the allegations in the amended complaint as true, Gabriji
executed a purchase agreement with HSI, the seller-developer, in 2014.
Gabriji’s funds in excess of 10% of the purchase price were used to
construct the property.      Because of HSI’s breach of the purchase
agreement, Gabriji sued HSI on January 4, 2017. Based on these
allegations, Hollywood East argues that Gabriji’s last contribution for
improvement to the property was before January 4, 2017, and Gabriji’s
claim for an equitable lien against Hollywood East—originally filed in April
2019—is barred by the one-year statute of limitations.

   Gabriji argues it is not clear from the face of the amended complaint
that section 95.11(5)(b) is the applicable limitations period. As quoted
above, that section applies to claims for an “equitable lien arising from the
furnishing of labor, services, or material for the improvement of real
property.” § 95.11(5)(b), Fla. Stat. Gabriji argues it did not furnish any
labor, services, or materials within the plain meaning of section

                                      5
95.11(5)(b); instead, it contracted to purchase property, and a portion of
the funds was used to develop the property.

    Hollywood East argues the status of Gabriji as a contractor or
purchaser is irrelevant and that Gabriji fails to point to any authority
applying a limitations period other than that in section 95.11(5)(b). In
support of its position that section 95.11(5)(b) applies, Hollywood East
relies on Jax Utilities Management, Inc. v. Hancock Bank, 164 So. 3d 1266
(Fla. 1st DCA 2015). Jax was a contractor that signed an agreement with
the owner to develop a building project. Id. at 1268. After the owner
defaulted on the project, Hancock Bank obtained a foreclosure judgment
and later obtained title to the property. Id. Jax sued Hancock Bank for
an equitable lien and unjust enrichment. Id. On appeal of the circuit
court’s dismissal order, the First District held that section 95.11(5)(b)’s
plain language requires “that a claim for an equitable lien be brought
within one year of the last furnishing of labor, services, or material for the
improvement of real property.” Id. at 1269 (citation omitted); see also
Roehner v. Atl. Coast Dev. Corp., 356 So. 2d 1296, 1297 (Fla. 4th DCA
1978) (reversing with instructions to dismiss complaint with prejudice
because it was “inescapably clear from the face of the complaint that the
suit was filed beyond the statutory period” in § 95.11(5)(b) (citation
omitted)).

   The language of the statute is clear. A one-year limitations period
applies to “an action to enforce an equitable lien arising from the
furnishing of labor, services, or material for the improvement of real
property.” § 95.11(5)(b), Fla. Stat. In essence, Hollywood East argues that
this period applies to all equitable lien claims. We disagree. The
legislature included only a limited set of claims in the shortened one-year
limitations period: those “arising from the furnishing of labor, services, or
material for the improvement of real property.” See § 95.11(5)(b), Fla. Stat.

   “Under the principle of statutory construction, expressio unius est
exclusio alterius,” also known as the negative-implication canon, “the
mention of one thing implies the exclusion of another.” Brown v. State, 263
So. 3d 48, 51 (Fla. 4th DCA 2018) (quoting Young v. Progressive Se. Ins.
Co., 753 So. 2d 80, 85 (Fla. 2000)); see also Estate of Cummings v.
Davenport, 906 F.3d 934, 942 (11th Cir. 2018) (quoting Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts § 10, at
107 (2012)).

    Applying that canon here, the statute includes multiple situations that
fall within the shortened limitations period, and the “conclusion that the
expression of all of these [claims] implies the exclusion of others . . . is

                                      6
inescapable.” See Davenport, 906 F.3d at 942 (internal quotation marks
and citation omitted); see also Daker v. Comm’r, Ga. Dep’t of Corr., 820
F.3d 1278, 1283–84 (11th Cir. 2016) (applying the negative-implication
canon to a statute that arose in three stated situations and concluding the
statute did not apply in other situations).

   Further, if the legislature intended to include all equitable lien claims
in the shortened period, it was unnecessary to list any specific type of
equitable lien claims. The statute could have simply stated that the one-
year limitations period applies to “an action to enforce an equitable lien”
without more. To apply the one-year period to all equitable lien claims
would render the remaining text surplusage.

   Gabriji provided funds, not labor, services, or materials. Based on the
four corners of the amended complaint, section 95.11(5)(b) does not apply.

                               Conclusion

   Based on the four corners of the amended complaint, the court erred
in dismissing the lawsuit with prejudice. We reverse the dismissal and
remand for further proceedings.

   Reversed and remanded for further proceedings.

LEVINE, C.J., and SHEPHERD, CAROLINE, Associate Judge, concur.

                           *         *         *

   Not final until disposition of timely filed motion for rehearing.

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