Articles Posted in Real Estate

A few decades ago, a U.S. president once famously responded to a question under oath by noting that “it depends on what the meaning of ‘is’ is.” Whatever one’s opinions of that statement, the reality is that, in the law, sometimes the outcomes of disputes hinge upon small phrases or even single words, and the very precise definition of those terms. That is especially true when it comes to commercial contracts and commercial litigation. That is why you should make sure you have highly skilled Florida business and commercial attorneys to meet your commercial contract needs.

As an example, take a recent case that originated in Palm Beach County. A real estate contract called for the making of payment if one of a list of several triggers took place. The first of those criteria was a “sale of the property’ at a designated street address. Eventually, the property in question was sold… at a foreclosure sale.

The party scheduled to receive payment under the contract argued that this was a valid trigger and payment was owed. The party owing payment contended it was not and refused to make the payment. The case went to trial and the singular key to the outcome was: what did the contract mean when it said “sale of the property”? Did that term include any sale or did it implicitly exclude involuntary sales like foreclosure sales? More specifically, was it clear what the contract meant? If it was not, then the parties were entitled to bring in outside “parol evidence” at trial. If it was clear, then outside evidence was inadmissible.

In any contract, including commercial leases and their associated personal guarantees, the choice of language is often extremely important. Sometimes, even seemingly small things make huge differences. That’s why it is so important to make sure that you carefully negotiate each term and then diligently defend the rights and benefits that you negotiated in your agreement. To ensure that you have the resources you need to make this happen, make certain you have experienced Florida commercial litigation attorneys on your side.

One example of a case in which the agreement’s precise wording made all of the difference was a landlord-tenant dispute at one of Orlando’s popular outlet malls. The tenant was a Caribbean restaurant, and the lease agreement called for the restaurant’s founder to sign a personal guaranty. Personal guarantees have become more commonly included terms within commercial leases ever since the economic downturn of the previous decade.

In the restaurant’s case, the guaranty provision in the lease said that, if the tenant defaulted, the guarantor would become responsible for paying the sums that remained due and owing. One key aspect of the case was the choice of wording used in the guaranty clause. The guaranty provision said that the guarantor “shall on demand of Landlord fully and promptly pay all Rental and other sums, costs, and charges to be paid by Tenant, … and in addition shall, on Landlord’s demand, pay to Landlord any and all sums due to Landlord under or pursuant to the terms of the Lease.”

In science, there is something called the “butterfly effect.” This is a concept that Google defines as a “phenomenon whereby a minute localized change in a complex system can have large effects elsewhere.” An example is a 1972 article in a science journal entitled, “Does the flap of a butterfly’s wings in Brazil set off a tornado in Texas?” Just as is true in science, there are situations in legal matters in which sometimes seemingly small changes or decisions can have massive impacts down the road. Thus, when you are faced with a contract dispute, it is important to have skilled Florida contract litigation counsel, who can advise you about all of your options and the possible ramifications of each decision.

A recent case originating from Palm Beach highlights this concept. The transaction that led to the litigation was a sale of a commercial property, specifically, a cemetery in Boca Raton. The buyer agreed to pay $6.125 million. After the sale, however, the sellers learned that an attorney had been working both sides of the deal and had received a $100,000 kickback from the buyer after the transaction closed.

This discovery led the seller to sue both the buyer and the lawyer. The seller alleged that the lawyer’s misconduct led it to sell the property for less than fair market value. The lawsuit stated claims for breach of contract, intentional misrepresentation, and conspiring to breach a fiduciary duty. The lawyer settled, but the case went to a trial against the buyer. The jury ruled for the seller and awarded it $4.2 million, with $2.2 million of that being punitive damages. The other $2 million was “damages relating to attorneys’ fees and costs incurred in connection with the transaction.”

If you encounter problems related to a commercial arrangement into which you entered, there are several things you need to keep in mind. One of these is that the law gives you a limited time to act. If you wait too long to sue, you may lose your right to seek recovery entirely. That is but one reason among many why it pays to retain skilled Florida commercial litigation attorneys for your case. Experienced counsel can help you be sure that your case meets all mandatory deadlines and that you are not blocked from suing by an improperly calculated statute of limitations.

One commercial litigation action in which the statute of limitations took center stage was a lawsuit arising from the fallout of a relationship between a Palm Beach county marina and the engineering firm it retained to construct a concrete runway slab. The marina intended for the slab to serve as a means for forklifts to transport boats from a boat barn to a water launch area.

At first, the marina was apparently satisfied with the slab. However, over time, that changed. The slab began developing “cracks, spalling and other deterioration.” The marina eventually came to the conclusion that the slab the engineer had constructed was defective, so it sued for damages based upon the defective slab.

A Palm Beach County real estate agent got a renewed opportunity to go after the large commission she alleged she was owed after working for nearly a year to sell a $4.7 million property on Palm Beach Island. As is true in many contract dispute cases, the details were key to the agent’s success. The broker whom the agent sued did not have enough of the proper type of evidence to establish that it was entitled to keep or split the commission, so it wasn’t entitled to summary judgment in the agent’s case.

Continue reading →

In a recent Third District Court of Appeal decision, a South Florida commercial tenant secured a reversal of a lower court’s ruling in favor of its landlord. The appeals court sent the two sides back to the lower court to present more evidence about what their true intent was regarding the rent provision in their agreement. The problem with the contract that led the appeals court to order additional action was that the lease contract’s rent provision was not clear and unambiguous on its face.

Continue reading →

During his investigation and impeachment, President Bill Clinton once famously stated that the accuracy of the answer he provided “depends upon what the meaning of the word ‘is’ is.” While such fine distinctions may seem foreign to many people, lawyers and others who deal with contracts know that victory or defeat in a contract dispute can sometimes come down the smallest of linguistic details. In a recent dispute between a Southwest Florida condo association and an LLC that owned several units, the case came down to the 2d District Court of Appeal‘s accepting the owner’s interpretation of the word “a” over that offered by the association.

The property at issue was a condominium outside Naples. The condominium had 94 units, 38 of which were owned by The Retreat at Port of the Islands, LLC. Retreat ran its units as a resort hotel. In March 2014, the Port of the Islands Resort Hotel Condominium Association, Inc. held an election for three of the five seats on its board of directors. Three of the managing members of Retreat ran for the board seats. Although the three Retreat members secured the highest vote totals, the condo association declared that only one of them could serve on the board.

Continue reading →