determiningawinner – prevaiLingpartYstiLLundeFined
Construction law Section Chairs : KimberlyKelley – PaskertDiversThompson & AlexSarsfield – PaskertDiversThompson
affirmativejudgmentdoes notcontroltheprevailing partydetermination .
The “ American Rule ” regarding attorneys ’ fees and costs requires each party to pay their own . 1 Florida Courts generally follow this rule except when fees are “ expressly provided for by statute , rule , or contract .” 2
Many construction contracts allow the “ prevailing party ” to recover fees and costs . However , prevailing party fee provisions can lack specificity and require interpretation , especially when the dispute involves multiple parties and issues . The Florida Supreme Court stated the party who prevails “ on the significant issues . . . should be considered the prevailing party for attorney ’ s fees .” 3 This gives trial court judges flexibility “ to determine from the record ” who prevailed on the significant issues . 4
Florida ’ s Fourth District Court of Appeal recently addressed the “ significant issues ” test and determination of the “ prevailing party ”. 5 Lemartec involved a dispute arising out of the construction of three buildings . 6 In that case , a Contractor provided three Letters of Intent ( LOI ) to a Subcontractor stating that subcontracts were forthcoming . 7 The Subcontractor never signed the subcontracts and , unlike the LOI ’ s , the subcontracts contained a cross-default provision . 8 The Subcontractor performed its duties , with the exception of
installing stairs at the final building . 9 As a result , the Contractor determined the Subcontractor failed to perform and did not pay the balance owed on the subcontracts pursuant to the cross-default provisions . 10
The Subcontractor filed suit , and the trial court awarded the Subcontractor the balance of the subcontracts minus the offset for not completing the stairs pursuant to the cross-default provisions . 11 Despite failing to secure the full balance alleged in its complaint , the trial court determined the Subcontractor was the prevailing party since they received “ some of the benefit ” sought and “ recover [ ed ] a money judgment .” 12
The Fourth District Court of Appeal disagreed , finding “ the mere fact that [ the ] Subcontractor recovered an affirmative judgment does not control the prevailing party determination .” 13 In their reasoning , the Fourth District Court of Appeal stated , “ a defendant who successfully defeats most of a plaintiff ’ s claimed damages can be considered the prevailing party , especially when the amount of damages is a significant point of contention between the parties .” 14
Even with this ruling , the question of how the “ prevailing party ” is determined remains unanswered . Absent a clear definition of the term , trial courts are left with discretion and flexibility in determining the threshold for prevailing on the significant issues in the case . n
1
See Alyeska Pipeline Service Co . v . Wilderness Society , 421 U . S . 240 ( 1975 ).
2
Hubbel v . Aetna Cas . & Sur . Co ., 758 So . 2d 94 , 97 ( Fla . 2000 ).
3
Moritz v . Hoyt Enters ., Inc ., 604 So . 2d 807 , 810 ( Fla . 1992 ).
4
Id .
5
Lemartec Corp . v . E . Coast Metal Structures Corp ., 391 So . 3d 426 ( Fla . 4th DCA 2024 ).
6
Id . at 428 .
7
Id . .
8
Id .
9
Id . at 428-29 .
10
Id . at 429 .
11
Id . at 430 .
12
Id . at 431 .
13
Id . at 435 .
14
Id . at 435 . See also Skylink Jets , Inc . v . Klukan , 308 So . 3d 1048 ( Fla . 4th DCA 2020 ).
Authors : Connor Smedberg – Foley & Lardner LLP & Brian Allen – Carlton Fields , P . A .
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