Wednesday, the Fourth District Court of Appeal addressed whether a defendant condominium unit owner who sells his unit during assessment collection litigation which is dismissed for lack of prosecution, has standing to seek prevailing party attorney’s fees. The decision is Tison v. Clairmont Cdm F Ass’n, Inc, Case No. 4D19-117 (Fla. 4^th DCA, November 6, 2019).

THE FACTS

In December 2015, the Condominium Association filed suit to enforce assessments seeking to foreclose its lien and for money damages against the defendants who owned the condominium unit, and recorded a lis pendens. The defendants’ Answer and Amended Answer pled a fee entitlement.

In March 2017, the defendants sold the unit to a third party. Over a year later the trial court dismissed the Association’s action for lack of prosecution triggering Tison’s motion for attorney’s fees pursuant to § 718.303(1), and the Declaration’s provision. Both similarly provided for attorney’s fees to the prevailing party in a claim alleging a unit owner’s failure to comply with the Act and the Declaration.

THE OPINION

The appellate court examined the definition of “unit owner.” The Condominium Act definition included “a record owner of legal title to a condominium parcel.” § 718.103(28) Fla. Stat. (2015). The Declaration similarly defined the term as “owner of a condominium parcel.”

The court quickly concluded that the dismissal for lack of prosecution resulted in Tison prevailing because “the Association received none of the relief it sought in the complaint.”

Zeroing in on timing considerations, at what time does the right to seek fees affix. The court first recited precedent:

“It is settled law that legal rights accrue and are fixed, not when an action is brought to enforce them, but rather when ‘the last element necessary to constitute the cause of action occurs.’” Serna v. Arde Apparel, Inc., 657 So. 2d 966, 966 (Fla. 3d DCA 1995) (citation omitted). Accordingly, “the right to recover attorney’s fees ancillary to another particular underlying cause of action always accrues at the time the other, underlying, cause of action accrues.” L. Ross, Inc. v. R.W. Roberts Constr. Co., 466 So. 2d 1096, 1098 (Fla. 5th DCA 1985), approved, 481 So. 2d 484 (Fla. 1986). Stated another way, the “substantive rights and obligations as to attorney’s fees in particular types of litigation vest and accrue as of the time the underlying cause of action accrues.” Id.

Thus, what this writer would describe as a “contingent entitlement” is triggered when the underlying cause of action arose, not when the motion for fees was filed. That time in this case occurred when the cause of action for delinquent assessments accrued.

Neither the Declaration nor the Condominium Act provisions required unit ownership at the time the motion for fees was filed. Instead, generally summarized, the two provisions allowed prevailing party attorney’s fees in litigation regarding an owner’s alleged failure to comply with Declaration or Act provisions.

Thus, the defendants transfer of the unit during the litigation was not fatal to Tison’s fee claim. What mattered was that Tison owned the unit at the time the cause of action accrued which creating at that time a “vested” right to attorney’s fees if he prevailed.

KIBITZING

The decision reminds counsel, whether representing associations or otherwise, to properly document plead dismissals to avoid prevailing party attorney’s fees claims.

The relatively short option immediately raises a question of “how did this happen?” The opinion states “the Association received none of the relief it sought in the complaint.” Think about how was the unit sold without the Association being paid, and if not paid, why the Association allowed the lawsuit to be dismissed, especially as Fla.R.Civ.Pro. 1.420(e) would have required notice to the Association’s counsel and an opportunity to file almost any piece of paper to avoid dismissal. The seemingly long period of time the case was pending before seeking summary judgment is also intriguing.

Note that the opinion does not indicate any abdication of the notice pleading requirement for fees, or the need to timely file a motion for fees pursuant to Fla.R.Civ.Pro. 1.525.

Note that these comments referred to the unit owner’s “standing.” Interesting the court did not use that term. In fact, the “entitlement” is in essence standing to pursue a claim, though ancillary to the main claim. Is the logical extension of the opinion that ownership is not required at the time suit is filed to have standing to pursue a claim? It would seem that injunctive relief would be barred, but for damages? Note also that the determination of when did the claim accrue parallels similar analyses in the statute of limitations context of when does a claim accrue to start running of the statute.

The opinion taking for granted the mandatory nature of the prevailing party fee provisions in the Act the Declaration may be helpful for associations, and owners!

In further musing, the opinion references multiple defendant owners; however, only Tison, one defendant, is listed as the appellant and referenced as the movant. Why did the other unit owner defendants not seek attorney’s fees, or alternatively, if they did, why not join the appeal?

Michael J. Gelfand

Past Chair

Real Property, Probate and Trust Law Section

of The Florida Bar

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Note: This article is not legal advice. Statements and comments made are not those of The Florida Bar or the RPPTL Section

© 2019 Michael J. Gelfand

Michael J. Gelfand

Florida Bar Board Certified Real Estate Attorney

Florida Supreme Court Certified Mediator:

Civil Circuit Court & Civil County Court

Fellow, American College of Real Estate Attorneys