In any commercial contract setting, things can go awry. When they do, and litigation becomes necessary, your case may present you with the opportunity to not only secure a judgment in your favor but also recoup some of your attorneys’ fees as well. In a recent case involving five South Florida malls, the appellate court upheld an award of attorneys’ fees in a commercial leasing breach of contract claim. The award was in the appropriate amount because each of the landlords’ claims shared a “common core” of facts and “related legal theories.”
An Ohio-based seller of Verizon cell phone products, which had previously limited its sales efforts to the Midwest, decided in 2010 to expand its footprint to Florida. The vendor, which sold its products inside kiosks situated in shopping malls, signed a contract with the agent for the landlords of five South Florida malls. The agent had allegedly persuaded the vendor that its kiosks would “make a lot of money.” They didn’t. Instead, the kiosks “hemorrhaged” money due to unanticipated competition with Best Buy Mobile, according to the vendor. Eventually, the tenant decided to pull its products from the malls due to the lack of sales.
Afterward, the tenant sued the agent and the landlords. The tenant asserted claims for conversion and fraud in the inducement. The landlords launched a defense against those claims and also countersued, accusing the tenant of breach of contract. The case went to trial in Ohio but was adjudicated under Florida law. The tenant lost on both of its claims. The landlord scored a partial victory, since the federal District Court awarded it damages on three of the mall leases but not on the other two.
The agent and landlords took an additional step. They also sought an award of attorneys’ fees in this case. The trial judge agreed but with limitations. The court concluded that the defendants were only entitled to fees that were racked up after the date of the ruling that granted summary judgment to the defendants on both of the tenant’s claims. Additionally, the court ruled that the defendants were only entitled to 26% of those fees, since the award they received on their countersuit was 26% of the total amount that they sought.
The ruling went up on appeal, but the appeals court upheld the lower court’s decision. The court explained that, under Florida law, a litigant is entitled to attorneys’ fees in limited situations. There must be a statute or a contractual provision that authorizes the award, and the amount sought must be reasonable. The tenant argued that the award wasn’t reasonable in this case because the defendants only won damages on three of the five leases, and, in one of those three, the document contained no provision approving awards for fees.
The appeals court described the tenant’s argument as “probably right” but then went on to explain why that didn’t matter. Florida law says that, when it comes to attorneys’ fees, “a party entitled to fees for work on one claim is entitled to its fees for work on all the claims” if all of those claims “share a ‘common core’ of facts and ‘related legal theories.'” In this case, the tenant sued the defendants jointly and severally. The defendants, meanwhile, defended themselves collectively and pursued their counterclaims collectively. Under these facts, the legal work “done for any of these defendants … was work done for all of them,” the court wrote.
If you face a tenant that has defaulted, and you need to sue for breach of contract, you need experienced Florida counsel representing you. The knowledgeable Florida landlord-tenant attorneys at Stok Folk + Kon have been helping commercial landlords and tenants for many years and have the skills and resources to assist you with your matter.
Contact us online or by calling (305) 935-4440 to schedule your consultation.
More blog posts:
Florida Mall Tenant Launches Class-Action Attack Against Commercial Landlord Over Utility Charges, Florida Business Lawyers Blog, Oct. 21, 2016
Commercial Landlord Unable to Enjoin Tenant from Publishing Disparaging Blog Posts, Florida Business Lawyers Blog, Dec. 15, 2014