County Civil Court: ATTORNEY'S FEES – Offer of Settlement – Sections 768.79(1) and 768.79(6)(b), Fla. Stat. (2009); Fla. R. Civ. P. 1.442. Trial court considers the "net judgment" (including costs, prejudgment interest, and attorney's fees incurred at time offer of settlement tendered by plaintiff) when determining whether the threshold has been met to recover attorney's fees after rejection of offer of settlement by a defendant. No abuse of discretion shown in the record as to the trial court's determination that the offer of settlement was made in bad faith. Affirmed. Linsky v. Bruce McLaughlin Consulting Services, No. 10-000049AP-88A (Fla. 6th Cir. App. Ct. January 11, 2012).
NOT FINAL UNTIL TIME EXPIRES FOR REHEARING AND, IF FILED, DETERMINED
IN THE CIRCUIT COURT FOR THE SIXTH JUDICIAL CIRCUIT
IN AND FOR PINELLAS COUNTY, FLORIDA
MICHAEL A. LINSKY, ESQUIRE and
JLA INVESTMENT CORPORATION,
Appellants, Case No.: 10-000049AP-88A
BRUCE MCLAUGHLIN CONSULTING
SERVICES, INC., a Florida corporation,
Opinion Filed ______________
Appeal from Final Judgment
Judge Walt Fullerton
Michael A. Linsky, Esq.
Attorney for Appellants
Alan M. Gross, Esq.
Attorney for Appellee
Michael Linsky, Esq. and JLA Investment Corporation appeal the October 20, 2010, Final Order Upon Fees, Costs, and Interest. Upon review of the briefs, the record, and the "Approved Statement of Evidence," this Court dispensed with oral argument pursuant to Florida Rule of Appellate Procedure 9.320. We affirm.
Statement of Case
On August 3, 2009, Bruce McLaughlin Consulting Services, Inc. ("McLaughlin") filed a three-count complaint. An Amended Complaint was deemed filed on October 21, 2009. In Count One, McLaughlin alleged breach of contract against JLA Investment Corporation ("JLA") for failure to remit payments of $7,293.10 for services rendered. In Count Two, McLaughlin brought an action for Account Stated against Michael A. Linsky, Esq. ("Linsky") for the sum of $7,293.10. In Count Three, McLaughlin brought an action for $7,293.10 in damages under quantum meruit against both JLA and Linsky.
On December 15, 2009, Linsky filed with the trial court a "Proposal for Settlement" pursuant to section 768.79, Florida Statues (2009), and Florida Rule of Civil Procedure 1.442 dated December 11, 2009. The document stated that the amount and terms of the settlement were for Linsky to pay McLaughlin $10.00 with $0.00 comprising punitive damages as none had been requested.
On June 21, 2010, Linsky filed a motion for partial summary judgment claiming there was no liability on his part for the services rendered by McLaughlin. A hearing was conducted. The trial court orally denied the motion at the July 16, 2010, hearing and the order denying the motion was entered on July 22, 2010. (7/22/10 Tr. 5-7).
On July 22, 2010, the trial court conducted a final hearing on McLaughlin's Amended Complaint. On July 27 2010, the trial court entered the "Final Judgment for Plaintiff (Defendant JLA), Directed Verdict for Defendant (Defendant Linsky)." The Final Judgment awarded McLaughlin $7,293.10 against JLA and found no liability for Linsky. The parties did not timely appeal this Final Judgment.
On August 9, 2010, Linsky filed a motion for attorney's fees against McLaughlin based on the offer of settlement. On August 11, 2010, McLaughlin filed a motion for attorney's fees, costs, and prejudgment interest against JLA based on an offer of settlement. McLaughlin attached the offer of settlement for $6,500.00 with no punitive damages that had been served on JLA on February 5, 2010.
On October 4, 2010, a hearing was conducted on McLaughlin's motion for attorney's fees, costs, and prejudgment interest; and upon Linsky's motion for attorney's fees. On October 20, 2010, the trial court concluded that McLaughlin had proven entitlement to $6,930.00 in attorney's fees. The final judgment states that JLA conceded that, after a reduction, McLaughlin's costs were appropriate and $711.50 was awarded in costs. The trial court concluded that JLA had agreed to prejudgment interest at the rate of twelve percent and awarded $1,070.92. The total award to McLaughlin for fees, costs, and prejudgment interest was $8,712.42. The trial court denied Linsky's motion for attorney's fees. A Notice of Appeal was filed by Linsky and JLA on October 27, 2010.
Arguments on Appeal
I. The July 27, 2010, Final Judgment
In their initial brief, JLA and Linsky present argument concerning the validity of the July 27 2010, Final Judgment of liability. However, the October 27, 2010, notice of appeal was untimely as to the July 27 2010, Final Judgment. This Court does not have jurisdiction to hear arguments raised in an untimely appeal concerning the July 27, 2010, Final Judgment. See Reid v. Cooper, 955 So. 2d 31, 32 (Fla. 3d DCA 2007).
This Court notes that in the Reply Brief, JLA and Linsky assert that the appeal of the July 27 2010, Final Judgment is pending in this matter. However, they have misconstrued this Court's February 24, 2011, "Order Granting Motion for Rehearing and Conditional Reinstating Appeal of JLA Investment Corporation of October 20, 2010, Final Judgment."
Pursuant to Florida Rule of Appellate Procedure 9.310(b)(1), without order of the Court, JLA filed a supersedeas bond with the Clerk of Court to stay the execution of the Final Judgment entered on July 27, 2010. The Initial Brief was filed by JLA and Linsky on January 24, 2011. This Court, on February 7, 2011, granted McLaughlin's motion and dismissed JLA's appeal of the July 27 2010, Final Judgment because the notice of appeal was untimely and also dismissed JLA's appeal of the October 20, 2010, final judgment on attorney's fees, costs, and prejudgment interest because the Notice of Appeal did not state that JLA was appealing from that final judgment.
JLA filed a motion for rehearing of the February 7, 2011, order of dismissal claiming there was a "technical error" in that the Notice of Appeal mistakenly failed to include the notation that JLA was appealing the October 20, 2010, final judgment on attorney's fees, costs, and prejudgment interest. In an order entered on February 24, 2011, this Court concluded that the Notice of Appeal was defective and there was evidence of record that JLA intended to appeal from the October 20, 2010, final judgment. JLA was required to post an additional bond for $9,757.90 in order to reinstate the appeal of the October 20, 2010, final judgment only. The Order did not reinstate the appeal of the July 27, 2010, Final Judgment as this Court has no jurisdiction over that final judgment because the Notice of Appeal was filed two months after the order became final on August 27, 2010. See Reid, 955 So. 2d at 32. The fact that a supersedeas bond has been posted by an appellant cannot confer jurisdiction upon the appellate court.
II. McLaughlin Attorney's Fees and Costs
JLA asserts that McLaughlin was improperly awarded attorney's fees based on the rejected offer of settlement for $6,500.00. When a plaintiff serves an offer of settlement that is not accepted by the defendant and obtains a judgment that is at least twenty-five percent greater than the amount of the offer, the plaintiff is entitled to recover attorney's fees and costs under section 768.79(6)(b) and rule 1.442. JLA correctly notes that in order to recover attorney's fees and costs under the statute and rule, the threshold amount to be met by McLaughlin is a "net judgment" totaling more than $8,125.00.
In White v. Steak & Ale of Florida, Inc., 816 So. 2d 546, 551 (Fla. 2002), the Florida Supreme Court held that the term "judgment" under section 768.79 must be defined to include not only the plaintiff's damages award, but also any attorney's fees, taxable costs, and prejudgment interest to which the plaintiff would have been entitled at the time the offer was made. The July 27, 2011, judgment for damages awarded against JLA was $7,293.10.
A. Costs. In the October 20, 2010, final judgment, concerning costs, the trial court notes that there was a dispute concerning the sum to be awarded to McLaughlin. The Order states, "With a $502.61 reduction for postage, fax and Westlaw charged, JLA concedes that [McLaughlin's] costs are appropriate. . . . The remaining costs were appropriate and reasonably incurred in pursuing [McLaughlin's] Complaint to Trial. Therefore, JLA is directed to tender to [McLaughlin] Court Costs in the amount of $711.50."
On appeal, JLA argues that the award of costs in the amount of $711.50 is incorrect. However, there was no court reporter at the October 4, 2010, hearing that resulted in the October 20, 2010, final judgment on attorney's fees, costs, and prejudgment interest. In accordance with Florida Rule of Appellate Procedure 9.200(b)(4), an "Approved Statement of Evidence" was signed by the trial court judge and filed with the Clerk of Court.
The "Approved Statement of Evidence" does not make any reference to the costs awarded or to any assertion by JLA at the October 4, 2010, final hearing that the sum of $711.50 was not appropriate. There is nothing in the record to refute the trial court's statement concerning JLA's concession on costs. Therefore, this Court concludes that JLA has failed to demonstrate that the award of $711.50 was not supported by the evidence before the trial court at the October 4, 2010, hearing. This amount shall be included in the calculation to determine if McLaughlin met the threshold requirement to recover attorney's fees under section 768.79(6)(b) and rule 1.442.
B. Prejudgment Interest. JLA argues that in calculating the threshold amount of the award under section 768.79(6)(b) and rule 1.442, the trial court erred when it determined that prejudgment interest of twelve percent was appropriate.
For purposes of determining if McLaughlin has met the threshold requirement to recover attorney's fees under section 768.79(6)(b) and rule 1.442, this Court will use the calculations for prejudgment interest advanced by JLA of eight percent for the year 2009 and six percent for the year 2010 for a total of $430.68.
Therefore, without considering the amount of attorney's fees awarded by the trial court (which should be part of the calculation under section 768.79(6)(b) and rule 1.442), taking the $7,293.10 awarded on July 27, 2010, the $711.50 in costs, and the minimum prejudgment interest of $430.68 advanced by JLA, the "net judgment" for McLaughlin was $8,435.28. This "net judgment" is more than $8,125.00, the amount JLA concedes is twenty-five percent greater than the amount of McLaughlin's offer. The trial court properly awarded attorney's fees to McLaughlin under section 768.79(6)(b) and rule 1.442.
C. Expert Witness. JLA also argues that McLaughlin did not present an expert witness to support its motion for attorney's fees. Included in the record before this Court is the affidavit of Sean McQuaid, Esq. concerning the reasonableness of the attorney's fees for services rendered by Alan M. Gross, P.A., on behalf of McLaughlin. The "Approved Statement of Evidence" states that there was a dispute concerning whether Linsky had waived the attendance and live testimony of an independent fee witness for McLaughlin. The trial court suggested that the hearing be continued if Linsky was of the opinion that the attendance of a fee expert had not been waived, or if Linsky was in any way prejudiced by the lack of such a witness. The "Approved Statement of Evidence" states that Linsky rejected the suggestion of a continuance. Further, the "Approved Statement of Evidence" indicates that the independent lawyer who testified as a fee expert for Linsky testified that the hourly rate charged by counsel for McLaughlin was reasonable. The "Approved Statement of Evidence" states that Linsky's fee expert "neither diminished, nor reduced [McLaughlin's] total number of hours claimed for reimbursement of attorney's fees."
An appellate court reviews an order on appellate attorneys' fees under an abuse of discretion standard. D'Alusio v. Gould & Lamb, LLC, 36 So. 3d 842, 846 (Fla. 2d DCA 2010). This Court concludes that the record supports the reasonableness of the fees awarded to McLaughlin by the trial court. There was no error or abuse of discretion in awarding attorney's fees to McLaughlin in the sum awarded.
III. Linsky Attorney's Fees
In Linsky's final claim he asserts that the trial court erred when it denied his motion for attorney's fees. Section 768.79(1) states in part:
In any civil action for damages . . . if a defendant files an offer of judgment which is not accepted by the plaintiff within 30 days, the defendant shall be entitled to recover reasonable costs and attorney's fees . . . from the date of filing of the offer if the judgment is one of no liability or the judgment obtained by the plaintiff is at least 25 percent less than such offer, and the court shall set off such costs and attorney's fees against the award.
The October 20, 2010, Order in pertinent part states:
The Court concludes that [Linsky] both failed to make a good faith Proposal for Settlement ($10.00) and failed to comply with the appropriate Rules in making his demand. [Linsky's] Motion for and Award of Attorney's Fees was filed in an untimely manner. As a result, [Linsky's] Motions for Fees and Costs are Denied.
With regard to Linsky's motion for attorney's fees, the "Approved Statement of Evidence," states as follows:
10. [Linsky's] Motion for Fees was incomplete and untimely as it contained no statement as to the amount of fees sought, nor the hourly rate and number of hours;
11. The nominal amount of [Linsky's] Proposal for Settlement ($10.00) was unreasonable and filed in bad faith, unrelated to [Linsky's] potential liability as reflected by the facts elicited during the earlier Final Hearing (An official record of the Trial was made by the court reporter and need not be repeated here);
12. The Trial Court concluded that [Linsky's] insufficient motion was more in the nature of a notice of hearing.
After receiving and considering the evidence, the Court took the matter under advisement in order to review the submissions, pleadings, facts and applicable law. It also applied to this matter the Court's own experience in reviewing numerous contested hearings upon motions for attorneys' fees.
A. Rule 1.442—Offer of Settlement
According to the Case Docket of the Clerk of Court included in the appellate record, Linsky was served with the complaint on August 21, 2009. The "Proposal for Settlement" was served on McLaughlin on December 11, 2009; more than ninety days after Linsky was served. The Notice of Trial in this matter was filed on May 17, 2010, for the July 22, 2010, trial. Pursuant to rule 1.442(b), service of the offer of settlement was proper. Further, the form and content of the offer of settlement is in compliance with rule 1.442(c).
Linsky filed the "Proposal for Settlement" with the trial court on December 15, 2009, before the Final Judgment was entered on July 27, 2010. In the past, the Second District Court of Appeal held that such premature filing of the offer of settlement would require the request for attorney's fees be denied. However, the Florida Supreme Court recently disapproved such a holding by the Second District Court of Appeal. The supreme court concluded, "After reviewing rule 1.442 and section 768.79, we find no basis to deny a party's motion for attorney fees and costs because the underlying proposal for settlement was filed before judgment was entered." Frosti v. Creel, 979 So. 2d 912, 916 (Fla. 2008). Therefore, the premature filing of the offer of settlement does not preclude the award of attorney's fees under the statute.
The trial court's finding in the October 20, 2010, final judgment that the Proposal for Settlement did not comply with rule 1.442 is erroneous.
B. Motion for Attorney's Fees
1. In the October 20, 2010, final judgment the trial court concluded that the motion for attorney's fees was untimely. In fact, the motion was filed on August 9, 2010, within thirty days after the filing of the July 27, 2010, Final Judgment. See Fla. R. Civ. P. 1.525. The motion for attorney's fees was timely filed.
2. As noted above, in the "Approved Statement of Evidence," the trial court found that the motion for attorney's fees was incomplete and untimely because it did not state the amount of fees sought, the hourly rate, or the number of hours expended by counsel. The trial court concluded that the motion for attorney's fees was more in the nature of a notice of hearing.
The Second District Court of Appeal in McDaniel v. Edmonds, 990 So. 2d 9, 12 (Fla. 2d DCA 2008), stated:
Rule 1.100(b) does not impose a requirement that motions for attorney's fees and costs be accompanied by affidavits setting forth the amount of fees and costs claimed. Silver Springs Props., L.L.C. v. ERA Murray Realties, Inc., 874 So. 2d 712, 714 (Fla. 4th DCA 2004); P & R Smith Corp. v. Goyarrola, 864 So. 2d 584, 584 (Fla. 3d DCA 2004). In the absence of such a requirement, there is no basis to deny a motion for attorney's fees for failing to request a particular amount of fees or costs or identify the specific costs sought or legal services performed. We decline to read the language in Gulf Landings [Ass'n, Inc. v. Hershberger, 845 So. 2d 344 (Fla. 2d DCA 2003),] referring to the movant's failure to specify the amount requested or mention costs in a notice of hearing as a requirement that a motion for attorney's fees and costs contain this information in order to be facially sufficient.
Pursuant to McDaniel, Linsky's motion was sufficient. The trial court erred when it treated the motion for attorney's fees as a notice of hearing and found it to be untimely.
C. Good Faith in Proposal for Settlement
1. Statement of Facts
The July 27, 2010, Final Judgment granted a directed verdict for Linsky. The Final Judgment states, "The Court found no credible evidence to support or otherwise prove that [Linsky's] law firm would or should be liable for payment." This finding of no liability preliminary establishes Linsky's right to attorney's fees incurred after the date of the offer of settlement. See Walgreen Co. v. Sklandis, 895 So. 2d 1201, 1202 (Fla. 3d DCA 2005).
In the Amended Complaint, McLaughlin alleged that JLA hired McLaughlin to perform consulting services. In the general allegation, the amended complaint states:
Plaintiff was later informed by the Defendant JLA INVESTMENT CORPORATION and its attorney, Defendant MICHAEL A. LINSKY, ESQ., that although Defendant JLA INVESTMENT CORPORATION would ultimately be responsible for payment, that all of its services would be billed directly through its attorney, Defendant MICHAEL A. LINSKY, ESQ. Plaintiff sent a confirming letter to Defendant MICHAEL A. LINSKY, ESQ. Plaintiff then, based on those instruction, re-billed its amounts directly to MICHAEL A. LINSKY, ESQ. Defendants informed Plaintiff that the reason for billing through Defendant MICHAEL A. LINSKY, ESQ. was to increase the chances Defendant JLA INVESTMENT CORPORATION could recover the costs in its dispute with Hillsborough County/City of Tampa.
In Count One, for breach of contract, the amended complaint states:
Upon the advice of Defendant MICHAEL A. LINSKY, ESQ., it was suggested that all bills be billed through MICHAEL A. LINSKY, ESQ. The reason for said instruction was that in the event that Defendant JLA INVESTMENT CORPORATION prevailed on its action on the land use of the property, attorneys' fees and costs would be recoverable but expert witness fees would not be. Therefore it was opined that the services being performed were to aid MICHAEL A. LINSKY[, ESQ.]. Defendant MICHAEL A. LINSKY, ESQ. agreed to be responsible for the payment as the services were in essence then being done for him.
In Count Two, for Account Stated against Linsky, the amended complaint realleged the general allegations and states:
Plaintiff and [Linsky] entered into a transaction in which the Plaintiff was to provide consulting services to the Defendant, MICHAEL A. LINSKY, ESQ.
The parties agree that the balance due is Seven Thousand, Two Hundred Ninety-Three and 10/100 Dollars ($7,293.10) exclusive of interest.
Defendant MICHAEL A. LINSKY, ESQ. made and [sic] express or implied promise to pay the balance due.
Count Three alleged a cause of action against Linsky and JLA in quantum meruit based on allegations that McLaughlin performed valuable services for the Defendants; Defendants received the services and acknowledged that they benefited from the services; Defendants have not paid for the services and McLaughlin should be compensated for the just value of the services provided to the Defendants.
The Amended Complaint was deemed filed on October 21, 2009. On November 16, 2009, Linsky filed an answer to the amended complaint and also filed a motion to dismiss. A hearing on Linsky's motion to dismiss was conducted on December 2, 2009. An order denying the motion to dismiss was entered on December 9, 2009. A review of the pleadings reveals that Linsky's liability was at issue. The $10.00 "Proposal for Settlement" was served on McLaughlin by Linsky on December 11, 2009.
In the October 20, 2010, final judgment denying attorney's fees to Linsky, the trial court concluded that Linsky's offer of settlement was not made in good faith. The "Approved Statement of Evidence" states: "The nominal amount of [Linsky's] Proposal for Settlement ($10.00) was unreasonable and filed in bad faith, unrelated to [Linsky's] potential liability as reflected by the facts elicited during the earlier Final Hearing (An official record of the Trial was made by the court reporter and need not be repeated here)." In reaching this conclusion, the trial court stated that it reviewed the submissions of the parties, pleadings, facts, and applicable law. The trial court also "applied to this matter the Court's own experience in reviewing numerous contested hearings upon motions for attorneys' fees."
In his Initial Brief and Reply Brief, Linsky argues that the $10.00 "Proposal for Settlement" was based on his thirty years of legal experience. Linsky asserts that he believed McLaughlin had no legal basis to pursue its action against him and this belief was proven to be correct when the trial court granted the motion for directed verdict at trial. Linsky asserts it was not unreasonable to have made an offer of settlement in the amount of $10.00.
The fact that a directed verdict was entered at trial is not dispositive of the issue of whether the $10.00 offer of settlement, presented to McLaughlin seven months prior to trial, was made in good faith.
In June 2009, Linsky filed a motion for partial summary judgment with a supporting memorandum in which he asserted that he was not individually liable for the services rendered to JLA by McLaughlin. After a hearing, the trial court orally denied the motion for partial summary judgment. At the time the trial court signed the order denying the motion, it pointed out that motions for summary judgment generally are denied because there are disputed issues of fact. (7/22/10 Tr. 6-7).
Once entitlement to fees is established under section 768.79 and rule 1.442, a decision by a trial court to deny an award of fees and costs has to be supported by a finding that the offer was not made in good faith.
The "Approved Statement of Evidence" indicates that in addition to evidence and argument presented at the October 4, 2010, hearing on the motions for attorney's fee, the trial court considered the testimony and evidence presented at the July 22, 2010, final hearing concerning McLaughlin's proof of Linsky's potential liability for the services rendered by McLaughlin. The trial court concluded that the offer of settlement was not made in good faith.
The appellate court reviews the trial court's determination of the section 768.79 good faith offer of settlement issue for an abuse of discretion. See Gawtrey v. Hayward, 50 So. 3d 739, 742-43 (Fla. 2d DCA 2010). The Florida Supreme Court in Canakaris v. Canakaris, 382 So. 2d 1197 (Fla. 1980), set out the test to review of a judge's discretionary power:
Discretion, in this sense, is abused when the judicial action is arbitrary, fanciful, or unreasonable, which is another way of saying that discretion is abused only where no reasonable man would take the view adopted by the trial court. If reasonable men could differ as to the propriety of the action taken by the trial court, then it cannot be said that the trial court abused its discretion.
Id. at 1203 (quoting Delno v. Market St. Ry. Co., 124 F. 2d 965, 967 (9th Cir. 1942)). The supreme court directed the appellate court to apply the "reasonableness" test to determine whether a trial court abused its discretion: "If reasonable men could differ as to the propriety of the action taken by the trial court, then the action is not unreasonable and there can be no finding of an abuse of discretion. The discretionary ruling of the trial judge should be disturbed only when his decision fails to satisfy this test of reasonableness." Id.
Upon review of the appellate record, including the transcript of the July 22, 2010, final hearing and the "Approved Statement of Evidence," this Court concludes that based on the Canakaris test, there is no evidence to support a conclusion that trial court abused its discretion when it determined that Linsky's offer of settlement was made in bad faith. The October 20, 2010, Final Order Upon Fees, Costs, and Interest is affirmed.
DONE AND ORDERED in Chambers in Clearwater, Pinellas County, Florida, this 11th day of January, 2012.
Original order entered on January 11, 2012, by Circuit Judges Linda R. Allan, W. Douglas Baird, and John A. Schaefer.
Copies furnished to:
Michael A. Linsky, Esq.
412 E. Madison St., Ste. 800
Tampa, FL 33602
Alan M. Gross, Esq.
4731 Central Ave.
St. Petersburg, FL 33713
Hon. Walt Fullerton
 The July 27, 2010, Final Judgment is final. The untimely appeal of that final judgment has been dismissed. McLaughlin may request that the Clerk of Court release the supersedeas bond for the July 27, 2010, Final Judgment at any time.
 In his Initial Brief, Linsky argues that the proper costs that should have been awarded was $503.75.
 In fact, when the amounts for costs and interest advanced by Linsky in his Initial Brief are added (without considering attorney's fees awarded), the "net judgment" threshold for recovery of attorney's fees and costs for McLaughlin still are met: $7,293.10 (damages) + $503.75 (costs) + $430.68 (interest) = $8,227.53. Linsky's argument is meritless.