Date: 01-24-2013

Case Style: Diamond Aircraft Industries, Inc. v. Alan Horowitch

Case Number: SC11-1371

Judge: Lewis

Court: Supreme Court of Florida

Plaintiff's Attorney: Marc Philip Ossinsky of Ossinsky & Cathcart, Winter Park, Florida and James C. Hauser, Maitland, Florida, for Appellee

Defendant's Attorney: Hala A. Sandridge of Fowler, White, Boggs, P.A., Tampa, Florida,
for Appellant

Description: This case is before the Court for review of four questions of Florida law certified by the United States Court of Appeals for the Eleventh Circuit that are determinative of a cause pending in that court and for which there appears to be no controlling precedent. We have jurisdiction. See art. V, § 3(b)(6), Fla. Const.

FACTS AND PROCEDURAL HISTORY

The four certified questions before this Court are:

DOES FLA. STAT. § 501.2105 ENTITLE A PREVAILING DEFENDANT TO AN ATTORNEY’S FEE AWARD IN A CASE IN WHICH A PLAINTIFF BRINGS AN UNFAIR TRADE PRACTICES CLAIM UNDER THE FDUTPA [FLORIDA DECEPTIVE AND UNFAIR TRADE PRACTICES ACT], BUT THE DISTRICT COURT DECIDES THAT THE SUBSTANTIVE
LAW OF A DIFFERENT STATE GOVERNS THE UNFAIR TRADE PRACTICES CLAIM, AND THE DEFENDANT ULTIMATELY PREVAILS ON THAT CLAIM?
IF FLA. STAT. § 501.2105 APPLIES UNDER THE CIRCUMSTANCES DESCRIBED IN THE PREVIOUS QUESTION, DOES IT APPLY ONLY TO THE PERIOD OF LITIGATION UP TO THE POINT THAT THE DISTRICT COURT HELD THAT THE PLAINTIFF COULD NOT PURSUE THE FDUTPA CLAIM BECAUSE FLORIDA LAW DID NOT APPLY TO HIS UNFAIR TRADE PRACTICES CLAIM, OR DOES IT APPLY TO THE ENTIRETY OF THE LITIGATION?

DOES FLA. STAT. § 768.79 APPLY TO CASES THAT SEEK EQUITABLE RELIEF IN THE ALTERNATIVE TO MONEY DAMAGES; AND, EVEN IF IT DOES NOT GENERALLY APPLY TO SUCH CASES, IS THERE ANY EXCEPTION FOR CIRCUMSTANCES IN WHICH THE CLAIM FOR EQUITABLE RELIEF IS SERIOUSLY LACKING IN MERIT?

UNDER FLA. STAT. § 768.79 AND RULE 1.442, IS A DEFENDANT’S OFFER OF JUDGMENT VALID IF, IN A CASE IN WHICH THE PLAINTIFF DEMANDS ATTORNEY’S FEES, THE OFFER PURPORTS TO SATISFY ALL CLAIMS BUT FAILS TO SPECIFY WHETHER ATTORNEY’S FEES ARE INCLUDED AND FAILS TO SPECIFY WHETHER ATTORNEY’S FEES ARE PART OF THE LEGAL CLAIM?

Horowitch v. Diamond Aircraft Indus., Inc., 645 F.3d 1254, 1262-67 (11th Cir. 2011).

The action from which these certified questions arose involves a contract dispute between Dr. Alan Horowitch, M.D., a resident of the State of Arizona, and Diamond Aircraft Industries, Inc., a foreign corporation that operates in Florida and has an agent here. In June 2004, Horowitch contracted to buy a single engine jet aircraft from Diamond Aircraft for the price of $850,000. Diamond Aircraft, however, failed to deliver the aircraft to Horowitch and refused to complete the transaction unless he paid a purchase price of at least $1,380,000. Consequently, Horowitch filed an action against Diamond Aircraft in the Circuit Court for the Ninth Judicial Circuit of Florida in which he sought specific performance of the contract with Diamond Aircraft and claimed that Diamond Aircraft breached both the terms of the contract and the implied covenants of good faith and fair dealing. Horowitch filed the action in a Florida state court with the contract at issue containing a provision that established exclusive jurisdiction and venue in Florida for all disputes and controversies arising from the contract.

The action filed in state court was removed to the United States District Court for the Middle District of Florida. After removal of the action, Horowitch amended his complaint. The amended complaint provided four claims: (1) specific performance of the contract; and, in the alternative, (2) breach of contract; (3) breach of the covenants of good faith and fair dealing; and (4) deceptive trade practices under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA). Horowitch demanded attorney’s fees pursuant to a prevailing party attorney’s fees provision provided under FDUTPA.

Pursuant to section 768.79, Florida Statutes (2011), Diamond Aircraft served Horowitch with an offer of judgment for $40,000. The offer of judgment stated:

Diamond Aircraft offers to settle this case on the following terms:

1. Diamond Aircraft shall pay Plaintiff the sum of forty thousand dollars ($40,000.00).

2. This offer is intended to resolve all claims that were or could have been asserted by Plaintiff against Diamond Aircraft in the Amended Complaint filed March 15, 2007. The condition of this offer is that Plaintiff will dismiss his pending claims against Diamond Aircraft, with prejudice to re-file.

3. This offer shall remain open for thirty (30) days from the date hereof. Failure to accept this offer within thirty (30) days shall be deemed a rejection of this offer under Fla. Stat. § 768.79(1).

4. This offer shall be accepted by filing a written acceptance with the Court within 30 days after service. Fla. Stat. § 768.79(4).

(Emphasis added.)

Horowitch did not accept this offer and both parties subsequently moved for summary judgment. The federal district court applied Florida law with regard to Horowitch’s demand for specific performance of the contract, as well as for his claims of breach of contract and breach of the implied covenants of good faith and fair dealing. Application of Florida law caused the trial court to enter a summary final judgment on all three of those claims in favor Diamond Aircraft. With regard to the remaining deceptive trade practices claim, the district court permitted the claim to proceed, but held that Arizona law (specifically, the Arizona Consumer Fraud Act (ACFA)), not Florida law, applied. The district court reasoned that Arizona law was applicable because that state was the location of most of the
business contacts between the parties. After a nonjury trial, the district court entered judgment in favor of Diamond Aircraft and against Horowitch on the deceptive trade practices claim.

After the final judgment had been entered, Diamond Aircraft moved for attorney’s fees. It claimed entitlement to fees (1) pursuant to the offer of judgment it previously served on Horowitch and section 768.79, Florida Statutes; and (2) pursuant to the prevailing party attorney’s fee provision provided in FDUTPA (section 501.2105, Florida Statutes (2006)). Diamond Aircraft contended that it was entitled to fees under FDUTPA notwithstanding that the district court had previously concluded that FDUTPA did not apply to Horowitch’s deceptive trade practices claim. Diamond Aircraft contended that by asserting and seeking recovery under FDUTPA, Horowitch had invoked the application of FDUTPA’s attorney’s fees provision, even if he did not prevail under that statutory provision.

The district court denied the motion for attorney’s fees. The court held that section 768.79 was inapplicable because Horowitch asserted both an equitable claim for non-monetary relief (specific performance) and, in the alternative, a claim for damages based on either breach of contract, breach of implied covenants, or a deceptive trade practice by Diamond Aircraft. The district court also held that Diamond Aircraft was not entitled to attorney’s fees under FDUTPA because Arizona law and not FDUTPA applied to the deceptive trade practices claim advanced by Horowitch. The district court concluded that Diamond Aircraft was not entitled to attorney’s fees under the Arizona law because the ACFA did not contain an applicable attorney’s fees provision. Diamond Aircraft sought review of the denial of its motion for attorney’s fees in the Eleventh Circuit.

On appeal, the Eleventh Circuit examined Florida law with regard to Diamond Aircraft’s claim for attorney’s fees under FDUTPA and Florida’s offer of judgment statute. See generally Horowitch, 645 F.3d at 1254-67. The federal appellate court concluded that Florida law has not specifically addressed these issues and certified the four questions to this Court. See id.

FDUTPA CERTIFIED QUESTIONS

First Certified FDUTPA Question

DOES FLA. STAT. § 501.2105 ENTITLE A PREVAILING DEFENDANT TO AN ATTORNEY’S FEE AWARD IN A CASE IN WHICH A PLAINTIFF BRINGS AN UNFAIR TRADE PRACTICES CLAIM UNDER THE FDUTPA, BUT THE DISTRICT COURT DECIDES THAT THE SUBSTANTIVE LAW OF A DIFFERENT STATE GOVERNS THE UNFAIR TRADE PRACTICES CLAIM, AND THE DEFENDANT ULTIMATELY PREVAILS ON THAT CLAIM?
We answer this question in the affirmative because Horowitch invoked FDUTPA by filing an action asserting a claim seeking recovery under that act in which Diamond Aircraft ultimately prevailed.

Standard of Review and Applicable Rules of Statutory Interpretation

The issue before this Court is a matter of statutory construction, which we review de novo. See Borden v. East-European Ins. Co., 921 So. 2d 587, 591 (Fla. 2006). Legislative intent is the polestar that guides our analysis regarding the construction and application of the statute. See Bautista v. State, 863 So. 2d 1180, 1185 (Fla. 2003). Our statutory analysis begins with the plain meaning of the actual language of the statute, as we discern legislative intent primarily from the text of the statute. See Heart of Adoptions, Inc. v. J.A., 963 So. 2d 189, 198 (Fla. 2007). If statutory language is “clear and unambiguous and conveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation and construction; the statute must be given its plain and obvious meaning.” Holly v. Auld, 450 So. 2d 217, 219 (Fla. 1984) (quoting A.R. Douglass, Inc. v. McRainey, 137 So. 157, 159 (Fla. 1931)). In instances of an ambiguity in statutory language, we may resort to the rules of statutory construction, which permit us to examine the legislative history to aid in our determination regarding legislative intent. See Weber v. Dobbins, 616 So. 2d 956, 958 (Fla. 1993). It is also well-established in Florida that a statute that awards attorney’s fees is in derogation of the common law rule that each party pay its own attorney’s fees and must be strictly construed. See Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So. 2d 276, 278 (Fla. 2003).

FDUTPA and its Attorney’s Fees Provision

Under FDUTPA, the Florida Legislature has declared that deceptive or unfair methods of competition and practices in trade and commerce are unlawful. See §§ 501.204, 501.2075, Fla. Stat. (2011). The express legislative purpose of FDUTPA is to protect individual consumers and certain defined business activities from deceptive, unfair, or unconscionable methods of business competition and trade practice. See id. § 501.202; see also § 501.203(7), Fla. Stat. (2011) (defining “consumer” under FDUTPA to include both individuals and certain types of business activities). The Legislature has specifically articulated that the provisions of FDUTPA are to be construed liberally with this legislative purpose. See id. § 501.202. To encourage citizens to invoke the protections of FDUTPA and file actions under that statute, the Legislature has provided that a prevailing party in a FDUTPA action may recover reasonable costs and attorney’s fees from the nonprevailing party. See Fla. H.R. Comm. on Governmental Operations, HB 1915 (1973), Staff Analysis 3-4 (May 3, 1973) (stating that the purpose of the attorney’s fees provision in FDUTPA was to “attract private attorneys to accept a consumer’s civil case since the attorney would be assured that if his client prevails, he would gain a legal fee proportionate to his efforts,” and that the attorney’s fees provision “applies to civil litigation arising from a consumer transaction in violation of [FDUTPA]”) (available from Fla. Div. of Archives); see also Standard Guar. Ins. Co. v. Quanstrom, 555 So. 2d 828, 833 (Fla. 1990) (“[T]he primary purpose of these fee-authorizing statutes is to encourage individual citizens to bring civil actions that enforce statutory policy.”).
The Legislature articulated FDUTPA’s attorney’s fees provision in section 501.2105(1), Florida Statutes (2011), which provides:

In any civil litigation resulting from an act or practice involving a violation of this part, except as provided in subsection (5), the prevailing party, after judgment in the trial court and exhaustion of all appeals, if any, may receive his or her reasonable attorney’s fees and costs from the nonprevailing party.

(Emphasis added.) In accordance with the plain language of this provision, to recover attorney’s fees in a FDUTPA action, a party must prevail in the litigation; meaning that the party must receive a favorable judgment from a trial court with regard to the legal action, including the exhaustion of all appeals. See id.; see also Heindel v. Southside Chrysler-Plymouth, Inc., 476 So. 2d 266, 270 (Fla. 1st DCA 1985) (“In summary, we hold that to recover attorney’s fees a party must (1) recover judgment on the chapter 501, part II claim, and (2) recover a net judgment in the entire case.”).

Pursuant to the plain language of section 501.2105(1), the attorney’s fees provision applies to “any civil litigation” that has resulted from an act or practice “involving a violation of this part,” i.e., to an action filed under FDUTPA. See § 501.203(3), Fla. Stat. (2011) (defining “[v]iolation of this part” as “any violation of
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[FDUTPA] or the rules adopted under [FDUTPA]” (emphasis added)). The legislative summary in a staff analysis regarding FDUTPA affords further support for the principal that the attorney’s fees provision applies to claims asserted under FDUTPA, which notes that FDUTPA “[p]rovides for payment of attorney’s fees and costs to the prevailing party in an action under [FDUTPA].” Fla. H.R. Comm. on Governmental Operations, HB 1915 (1973), Staff Analysis 13 (May 4, 1973) (emphasis added) (available from Fla. Div. of Archives). Florida’s Third District Court of Appeal has applied this interpretation, holding that FDUTPA’s attorney’s fees provision applies to a defendant who prevailed in an action filed against him under that act, even though the trial court ultimately held that FDUTPA did not apply. See Rustic Village, Inc. v. Friedman, 417 So. 2d 305, 305-06 (Fla. 3d DCA 1982) (stating that upon a trial court’s finding that a plaintiff filed a claim under FDUTPA, an award of attorney’s fees to a prevailing defendant is permissible in the action, even if the trial court ultimately holds that FDUTPA does not apply). This reasoning was followed by Florida’s Fourth District Court of Appeal in Brown v. Gardens by the Sea South Condominium Ass’n, 424 So. 2d 181 (Fla. 4th DCA 1983).

In Brown, the plaintiff filed an action pursuant to FDUTPA and included a claim for attorney’s fees under the act. See id. at 184. The defendant prevailed when the trial court determined that, because the transaction at issue pertained to
real estate which does not fall within FDUTPA’s definition of a “consumer transaction,” FDUTPA was not applicable to the plaintiff’s claim. See id. The defendant moved for attorney’s fees under FDUTPA, but the trial court denied that motion based on its previous determination that FDUTPA was not applicable to the transaction. See id. The Fourth District reversed and held that, even though the trial court found that FDUTPA was inapplicable, because the plaintiff invoked FDUTPA’s protections and filed an action under FDUTPA, the plaintiff, as the nonprevailing party, was responsible to the defendant for attorney’s fees under that act. See id. (“The plaintiff, having invoked the Act, is liable for an attorney’s fee because he did not prevail.” (quoting Rustic Village, 417 So. 2d at 306)).

1

The Instant Case

Diamond Aircraft is entitled to attorney’s fees under section 501.2105(1) because Horowitch, similar to the plaintiffs in Brown and Rustic Village, filed an action against Diamond Aircraft under FDUTPA and ultimately was the nonprevailing party. By invoking FDUTPA and seeking redress under its remedial provisions, Horowitch exposed himself to both the benefits and the possible consequences of that act’s provisions. As recognized in Brown and Rustic Village,
simply because FDUTPA is ultimately held to have no application and does not provide a plaintiff with a basis for recovery after the provisions of the act have been invoked does not negate a defendant’s status as a prevailing party in an action filed by a plaintiff under that act. See Brown, 424 So. 2d at 184; Rustic Village, 417 So. 2d at 305-06.
We agree with Horowitch that Brown and Rustic Village are factually distinguishable from this case. In Brown, the Fourth District held that FDUTPA did not apply because the real estate transaction at issue did not fall within FDUTPA’s definition of a “consumer transaction”—not because the law of another jurisdiction applied. See Brown, 424 So. 2d at 184. Similarly, in Rustic Village, the trial court entered a judgment on the pleadings because the plaintiff’s FDUTPA claim was not covered by the provisions of that act; not because the law of another jurisdiction applied. See Rustic Village, 417 So. 2d at 305-06. Horowitch claims that the distinguishable facts in his case—i.e., that the application of the law of another jurisdiction negates his FDUTPA claim—thwarts the application of FDUTPA’s attorney’s fees provision.

We disagree with Horowitch and also view the decision in Love v. Associated Newspapers, Ltd., 611 F.3d 601 (9th Cir. 2010), as persuasive. There, the plaintiff filed an action against the defendant for claims under California’s statutory and common law rights of publicity. See id. at 607-08. California’s sublicity statute mandates an award of attorney’s fees for “[t]he prevailing party in any action under this section.” Id. at 614 (quoting Cal. Civ. Code § 3344). A federal district court ultimately held that English law rather than California statutory and common law applied and dismissed the plaintiff’s action. See id. at 607. The defendant moved for attorney’s fees pursuant to the California publicity statute. See id. at 614. The district court awarded the defendant attorney’s fees pursuant to the California publicity statute and the Ninth Circuit affirmed that award. See id. In so holding, the Ninth Circuit concluded that the plaintiff had filed an action under California’s right of publicity statute and an award of attorney’s fees to the defendant was warranted, notwithstanding that the statute’s other substantive provisions did not apply. See id.

Similarly, in this case, Horowitch filed an action under FDUTPA. The district court held that the law of another jurisdiction applied. This did not negate the fact that Horowitch asserted his initial cause of action under FDUTPA. Like the plaintiff in Love, Horowitch cannot assert and invoke the protections of this act by filing a legal action under its provisions, but then rely on the act’s ultimate inapplicability as a shield against the application of the act’s attorney’s fees provision. To hold otherwise would negate individual accountability in filing actions by permitting meritless filings of FDUTPA claims without recourse for a defendant who was forced to defend an action initially filed under a law ultimately held to be inapplicable. As the Fourth District reasoned in Brown, that approach would permit the plaintiff to assert claims under FDUTPA pursuant to the dubious rationale: “heads I win, tails you lose.” Brown, 424 So. 2d at 184.

Therefore, we answer this certified question in the affirmative.

Second Certified FDUTPA Question

IF FLA. STAT. § 501.2105 APPLIES UNDER THE CIRCUMSTANCES DESCRIBED IN THE PREVIOUS QUESTION, DOES IT APPLY ONLY TO THE PERIOD OF LITIGATION UP TO THE POINT THAT THE DISTRICT COURT HELD THAT THE PLAINTIFF COULD NOT PURSUE THE FDUTPA CLAIM BECAUSE FLORIDA LAW DID NOT APPLY TO HIS UNFAIR TRADE PRACTICES CLAIM, OR DOES IT APPLY TO THE ENTIRETY OF THE LITIGATION?

We conclude that Diamond Aircraft is entitled to fees but only for the period of litigation until the federal district court held that FDUTPA did not apply to Horowitch’s claim.

Scope of Attorney’s Fees Under FDUTPA

Under FDUTPA, a prevailing party is entitled to reasonable attorney’s fees and costs in civil litigation arising from a violation of that act “after judgment in the trial court and exhaustion of all appeals.” § 501.2105(1), Fla. Stat. (2011). To recover attorney’s fees, subsection 501.2105(2) provides that the attorney for the prevailing party must submit a sworn affidavit regarding the time expended litigating a civil action involving a FDUTPA claim. See § 501.2105(2).

Subsection 501.2105(3) permits an award of attorney’s fees for the hours actually expended on a civil action involving a FDUTPA claim. See § 501.2105(3).

Florida’s district courts of appeal have adopted an accurate and reasonable interpretation of those statutory provisions. In Heindel, 476 So. 2d at 271, the First District construed the language of subsections 501.2105(1)-(3) as contemplating recovery for the hours an attorney dedicated to litigating a civil action involving a FDUTPA claim “unless the attorney’s services clearly were not related in any way to establishing or defending an alleged violation of chapter 501.” (Emphasis added); see also Mandel v. Decorator’s Mart, Inc., 965 So. 2d 311, 314 (Fla. 4th DCA 2007) (quoting the interpretation of subsections 501.2105(1)-(3) provided in Heindel and utilizing its analysis). The Heindel court elaborated further that even if a FDUTPA claim is based on the same transaction as an alternative theory of recovery, a court may allocate attorney’s fees under section 501.2105 for only the FDUTPA portion of an action if either (1) counsel admits that the other services provided in that action were unrelated to the FDUTPA claim, or (2) a party establishes that the services related to non-FDUTPA claims “were clearly beyond the scope of a 501 proceeding.”
Id. at 272; see also Mandel, 965 So. 2d at 314.

We agree with this interpretation of subsections 501.2105(1)-(3) because to construe those subsections otherwise—i.e., to award attorney’s fees for parts of an action clearly unrelated to or beyond the scope of a FDUTPA violation—is
tantamount to an interpretation of FDUTPA that renders an absurd and unreasonable result. See Fla. Dep’t of Envtl. Prot. v. ContractPoint Fla. Parks, LLC, 986 So. 2d 1260, 1270 (Fla. 2008) (“We have long held that the Court should not interpret a statute in a manner resulting in unreasonable, harsh, or absurd consequences.”). Simply, such an interpretation would be contrary to the purpose of FDUTPA’s attorney’s fees provision, which is to award attorney’s fees to the party that prevailed in civil litigation that involved a violation of FDUTPA—not for an action clearly beyond FDUTPA’s scope. See § 501.2105(1) (providing for an award of attorney’s fees for the prevailing party in an action “involving a violation of [FDUTPA]”).

The Instant Case

We conclude that Diamond Aircraft is entitled to an award of attorney’s fees for the time expended on this litigation until the federal district court held that FDUTPA was inapplicable. After the federal district court supplanted FDUTPA with Arizona’s deceptive trade practice act, the action evolved into civil litigation clearly beyond the scope of a FDUTPA proceeding. From that point forward, the parties were no longer establishing or defending an alleged violation of FDUTPA, or even litigating under applicable Florida law. Rather, the parties were then establishing or defending an alleged violation of Arizona’s deceptive trade practice law.

Therefore, we conclude that Diamond Aircraft is entitled to attorney’s fees for the period of litigation up to the point that the federal district court held that FDUTPA was not applicable to Horowitch’s claim.

OFFER OF JUDGMENT CERTIFIED QUESTIONS

Impact of Southeast Floating Docks, Inc. v. Auto-Owners Insurance Co.

The next two certified questions concern Florida’s offer of judgment statute, as delineated in section 768.79, Florida Statutes (2006). The specific matters we must address are (1) whether section 768.79 is inapplicable because Horowitch’s action concerned both monetary (damages) and nonmonetary (equitable) relief, and (2) whether section 768.79 applies when the offer of judgment Diamond Aircraft served on Horowitch did not satisfy the specific requirements of Florida Rule of Civil Procedure 1.442(c)(2). We recently decided Southeast Floating Docks, Inc. v. Auto-Owners Insurance Co., 82 So. 3d 73 (Fla. 2012), which is instructive here.

In Southeast Floating Docks, the Eleventh Circuit certified three questions to this Court regarding the applicability of section 768.79. Id. at 76. One of the questions inquired whether a federal court sitting in Florida should apply section 768.79 when a contract stipulates that the substantive law of another jurisdiction is applicable. See id. We held that section 768.79 is substantive for both constitutional and conflict of law purposes. Id. at 80. We then held that when parties agree to be bound by the substantive law of another forum, absent a sufficient public policy concern, section 768.79 has no application. See id. This led to our conclusion that an award of attorney’s fees under section 768.79 was not proper in that case because the parties’ agreement to be bound by the substantive law of another state rendered section 768.79 with no application. Id. at 81.

However, the facts of Southeast Floating Docks are distinguishable from the facts in this case and, thus, that decision does not answer the certified questions now before us. In Southeast Floating Docks, the cause of action arose from a contract with a choice-of-law provision that required the application of Michigan law, causing a conflict of law between Michigan law and Florida law. In contrast, in this case, there was no conflict of law problem, as the choice-of-law provision required the application of Florida law. Instead, the federal district court decided, based on relevant facts and not a contractual provision, that the deceptive trade practices law of another jurisdiction applied. Moreover, in consideration of the motion for summary judgment and the determination of that motion, the federal district court applied Florida law to Horowitch’s specific performance, breach of contract, and bad faith claims. The only claim to which the district court applied Arizona law was Horowitch’s deceptive trade practices claim. The district court applied the substantive law of Florida to three of Horowitch’s four claims.

Florida’s offer of judgment statute applies in this case. We now address the certified questions before us regarding Florida’s offer of judgment statute.

First Certified Offer of Judgment Question

DOES FLA. STAT. § 768.79 APPLY TO CASES THAT SEEK EQUITABLE RELIEF IN THE ALTERNATIVE TO MONEY DAMAGES; AND, EVEN IF IT DOES NOT GENERALLY APPLY TO SUCH CASES, IS THERE ANY EXCEPTION FOR CIRCUMSTANCES IN WHICH THE CLAIM FOR EQUITABLE RELIEF IS SERIOUSLY LACKING IN MERIT?

We answer both parts of this certified question in the negative and conclude that section 768.79 does not apply to cases that seek both equitable relief and damages, and that section 768.79 does not provide an exception to this rule for equitable claims that lack serious merit.

Standard of Review and Rules of Statutory Construction

As with the first two certified questions, this issue involves a matter of statutory construction that we review de novo. See Borden, 921 So. 2d at 591. When the language of a statute is free from ambiguity, this Court applies its plain meaning. See State Farm Mut. Auto. Ins. Co. v. Nichols, 932 So. 2d 1067, 1073 (Fla. 2006). The language of section 768.79, as well as Florida Rule of Civil Procedure 1.442, must be strictly construed because those provisions are in derogation of the common law rule that a party is responsible for its own attorney’s fees, and because they are penal in nature. See Campbell v. Goldman, 959 So. 2d 223, 226 (Fla. 2007); TGI Friday’s, Inc. v. Dvorak, 663 So. 2d 606, 615 (Fla. 1995).

Section 768.79 and Applicable Case Law

As we recently stated in Southeast Floating Docks, the Florida Legislature enacted section 768.79 to deter individuals from rejecting purportedly reasonable settlement offers through the imposition of the sanctions of costs and attorney’s fees. See Southeast Floating Docks, 82 So. 3d at 79. The relevant portion of section 768.79 provides:

(1) In any civil action for damages filed in the courts of this state, 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 incurred by her or him or on the defendant’s behalf pursuant to a policy of liability insurance or other contract 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 th

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http://www.floridasupremecourt.org/decisions/2013/sc11-1371.pdf

Outcome: We answer the first certified question with regard to FDUTPA in the affirmative because Horowitch filed an action specifically under FDUTPA, which invoked the provisions of FDUTPA (including attorney’s fees) until the claim was determined. With regard to the second certified question concerning FDUTPA, Diamond Aircraft’s recovery is limited to the time expended on the litigation until the federal district court determined that FDUTPA did not apply, because at that point, the parties were asserting and defending actions clearly beyond the scope of a FDUTPA proceeding. We answer both certified questions that concern Florida’s offer of judgment statute in the negative because (1) pursuant to the language of section 768.79, that statutory section does not apply to an action that involves both an equitable claim and a claim for damages, and does not provide an exception for equitable claims that lack serious merit; and (2) in accordance with our prior precedent, an offer of judgment is not valid under rule 1.442 if it does not meet the strict requirements of that rule. Having answered the certified questions, we return this case to the United States Court of Appeals for the Eleventh Circuit.
It is so ordered.

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