CASE LAW AND STATUTORY UPDATE by alicejenny

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									              CASE LAW AND STATUTORY UPDATE:
              RECENT CASES AND SECTION 57.105
                    ATTORNEY’S FEES




                            Prepared and Presented By:

                      Joseph A. Corsmeier, Esquire
                        Joseph A. Corsmeier, P.A.
                     2454 McMullen Booth Rd, Ste. 431
                       Clearwater, Florida 33759
                           Office:(727) 799-1688
                           Fax: (727) 799-1670


                                 jcorsmeier@jac-law.com.com




       Joseph A. Corsmeier practices in Clearwater with the Law Office of Joseph A.
Corsmeier, P.A. He previously was a partner in the law firm of Tew, Barnes & Atkinson and
served as Staff Counsel for the Tampa office of The Florida Bar from 1990 to 1998 and as an
Assistant State Attorney for the Sixth Judicial Circuit from 1986 to 1990. Mr. Corsmeier’s
practice currently consists of Bar and Professional admission and disciplinary defense, expert
opinion and testimony on ethics and professionalism issues workers’ compensation and labor
law.
               CASE LAW AND STATUTORY UPDATE:
        RECENT CASES AND SECTION 57.105 ATTORNEY’S FEES

       I.      Inherent Authority of Court to Sanction Offending Attorneys.

               A.     Moakley and Diaz and Recent Cases.

                      1.      Moakley v. Smallwood, 826 So.2d 221 (Fla. 2002).

                              Florida Supreme Court opinion held that courts have inherent
                              authority to sanction bad faith conduct of attorney pursuant to
                              the inequitable conduct doctrine by requiring the attorney to
                              personally pay fees of opposing party, however, the court
                              must first comply with due process requirements outlined in
                              the opinion.1 Opinion quashed the trial order imposing
                              sanctions on the attorney personally.

                      2.      Diaz v. Diaz, 826 So.2d 229 (Fla. 2002).

                              Florida Supreme Court opinion held that court has inherent
                              authority to impose sanctions personally upon an attorney for
                              bad faith conduct under limited circumstances, however, the
                              court did not make specific factual findings of bad faith
                              conduct by the attorney and the record did not support such a
                              finding. Opinion quashed the order imposing sanctions on
                              the attorney and remanded on other grounds.

                      3.      T/F Systems, Inc. v. Malt, 814 So.2d 511 (Fla. 5th DCA
                              2002).

                              Opinion reversed a trial court order awarding attorney’s fees
                              pursuant to the court’s inherent authority and remanded for
                              evidentiary proceedings consistent with the Moakley
                              decision. In a footnote, the opinion noted that neither party
                              raised the applicability of Section 57.105, however, the court
                              observed that the “inequitable conduct doctrine” used in
                              analyzing the basis of the inherent authority to impose

1
 Sanctions must be supported by detailed, highly specific factual findings, the attorney’s fees
must be directly related to the fees and costs incurred by the opposing party, and there must be
notice and an opportunity to present witnesses and other evidence.




                                                2
                         sanctions may have been rendered obsolete by the 1999
                         amendment to Section 57.105 which broadened the
                         application of the statute.

                  4.     North County Company v. Bologna, 816 So.2d 842 (Fla. 4th
                         DCA 2002).

                         Opinion vacated portion of trial court order awarding
                         attorney’s fees under court’s inherent authority and remanded
                         for evidentiary hearing in compliance with Moakley.

                  5.     Sumlar v. Sumlar, 827 So.2d 1079 (Fla. 1st DCA 2002).

                         Opinion reversed award of attorney’s fees in dissolution
                         matter for evidentiary hearing in compliance with Moakley
                         and Diaz, as well as a determination of the parties’ needs and
                         ability to pay if the award is imposed against a party.

                  6.     Department of Revenue v. Barry S. Franklin & Associates,
                         P.A., (2003 WL 1720100 (Fla. 3d DCA April 2, 2003)).

                         Opinion reversed award of attorney’s fees under the inherent
                         authority of the court because the findings of fact in the trial
                         court’s order did not comply with the requirements of Diaz
                         and Moakley.



II.   Attorney’s Fees under Section 57.105 Florida Statutes.

            A.    1999 Amendment to Section 57.105.

                  1.     Sanctions, including attorney’s fees, may be imposed in equal
                         amounts against an attorney and the party for raising
                         unsupported claims and defenses.
           a.     the claim may be initiated by the court or raised by
                  motion of any party;

           b.     sanctions may be imposed if the court finds that the
                  losing party or the losing party’s attorney knew or
                  should have known that the claim or defense was not
                   supported by the material facts necessary to establish
                  the claim or defense or would not be supported by the
                  application of then-existing law and the material facts;

           c.     the losing party’s attorney is not personally responsible
                  if he or she has acted in good faith, based on the
                  representations of the client as to the existence of
                  material facts;

           d.     sanctions do not apply if the attorney initially
                  presented a claim or defense as a good faith argument
                  for extension, modification, or reversal of existing law
                  or establishment of new law with a reasonable
                  expectation of success;

           e.     party moving for sanctions must serve the motion 21
                  days prior to filing and allow opposing party an
                  opportunity to withdraw or correct the claim or
                  defense;

           f.     sanctions are supplemental to any other remedies or
                  sanctions available by law or court rules;

           g.     court can award attorney’s fees to whichever party
                  prevails in contract action.

B.   Recent cases addressing Section 57.105, as amended (1999).


     1.    O’Grady v. Potash, 824 So.2d 904 (Fla. 3d DCA 2002).

           Indemnification of fees by thirty-party defendant does not
           affect entitlement to attorney fees under Section 57.105, as
           amended.
2.   Gahn v. Holiday Property Bond, Ltd. and HPB, 826 So.2d
     423 (Fla. 2d DCA 2002).

     Trial court order denying motion for attorney fees reversed
     and remanded with instructions to trial court to hold
     evidentiary hearing to determine when defense counsel knew
     about defendant’s business activities and business
     relationships in Florida when he filed the motion to dismiss
     complaint and quash service of process due to lack of
     personal jurisdiction as well as the appropriate amount of fees
     incurred by the plaintiff in defending the complaint against
     the motion to dismiss and quash service. No discussion of
     attorney/client confidentiality issues with regard to
     determining what defense counsel knew or learned about
     defendant’s business activities and business relationships.
     The standard for appellate review of a trial court order
     denying motion for attorney fees under Section 57.105, as
     amended, is abuse of discretion.

3.   Bridgestone/Firestone, Inc. v. Herron, 828 So.2d 414 (Fla. 1st
     DCA 2002).

     Trial court order denying motion to dismiss for lack of
     personal jurisdiction and awarding attorney’s fees under
     Section 57.105 affirmed and motion for appellate attorney’s
     fees granted. Evidence sufficient to show that motion to
     dismiss was plainly without merit and could not be sustained
     under any interpretation of the law. Section 57.105, as
     amended, authorizes an award of attorney’s fees “at any time”
     during a civil proceeding or action, therefore, in interlocutory
     appeal, appellate fees may be assessed. (See at id: Forum v.
     Boca Burger, Inc., 788 So.2d 1055 (Fla. 4th DCA 2001),
     review granted, 817 So.2d 844 (Fla. 2002.

4.   Goldfisher v. Ivax Corporation, 827 So.2d 1110 (Fla. 3d DCA
     2002).

     Stockholder brought suit against corporation which resulted
     in the removal of a “poison pill” clause from corporation’s
     stockholder documents and appealed trial court’s denial of
     fees because request for fees had not been pled in complaint.
     Appellate opinion affirmed trial court order denying fees and
     also denied corporation’s request for appellate fees under
     Section 57.105 because neither the lawsuit nor the appeal
     were “totally without merit.”

5.   Andzulis v. Montgomery Road Acquisitions, Inc., 831 So.2d
     237 (Fla 5th DCA 2002).

     Trial court ordered attorney’s fees to be paid by the plaintiffs
     under Section 57.105. The order did not require one-half of
     the fees to be paid by plaintiff’s counsel even though the
     order found “a complete absence of a justiciable issue of
     either law or fact raised (in) the complaint” and the complaint
     was “devoid of merit.” Appellate opinion reversed the order
     and held that the trial court was required to assess one-half of
     the fee award against the attorney for lack of a justiciable
     issue. Opinion further held that burden is on attorney who
     made the claim or defense to show good faith and not on the
     moving party to show bad faith or absence of good faith in
     order to avoid breaching “the rather impermeable wall of
     attorney-client privilege.”

6.   Cowgill v. Bank of America, 831 So.2d 241 (Fla. 2d DCA
     2002).

     Trial court entered summary judgment against the plaintiffs
     on the ground that the claim was barred by the statute of
     limitations and awarded fees to defendants under Section
     57.105. Plaintiffs appealed and appellate opinion affirmed
     summary judgment and reversed the award of attorney’s fees
     because the claim was arguably supported by material facts
     and then-existing law.

7.   Read v. Taylor, 832 So.2d 219 (Fla. 4th DCA 2002).

     Trial court awarded attorney’s fees under Section 57.105, as
     amended. Appellate opinion reversed the order of the trial
     court stating that the statute still is intended to address the
issue of frivolous pleadings and that “it appears from the
record...that these claims were not so completely lacking in
merit as to warrant an award of fees under Section 57.105.”
8.   Mullins v. Kennelly, 2003 WL 21471719 (5th DCA
     June 27, 2003).

     Trial court assessed attorney’s fees sanctions ½ against
     plaintiff and ½ against plaintiff’s attorney after
     personal injury suit was dismissed for lack of
     prosecution. Plaintiff’s attorney appealed and argued,
     inter alia, that if attorney’s fees were to be assessed,
     the sanction should be solely against the plaintiff, his
     client. The 5th DCA reversed the award of fees, stating
     that Section 57.105 cannot be applied to conduct prior
     to the effective date of the statute and that a dismissal
     for lack of prosecution is not an adjudication on the
     merits, therefore, 57.105 sanctions cannot be imposed.
     In dicta, the opinion expressed concern that the
     attorney may have had a conflict of interest under Bar
     Rule 4-1.7 in arguing that, if fees were assessed, the
     sanction should be imposed solely against his client.

9.   Inquiry Concerning a Judge re: Charles W. Cope (Fla.
     May 29, 2003).

     The Supreme Court of Florida approved a public
     reprimand for the Circuit Judge but denied the judge’s
     request for attorney’s fees to be imposed as a sanction
     against the Judicial Qualifications Commission (JQC)
     under Section 57.105. The judge argued that the
     sanctions should be imposed because certain charges
     were unfounded. The opinion noted that Section
     57.105 applies only to civil proceedings and it had
     never applied 57.105 to JQC proceedings or any other
     administrative proceedings. Further, even if the statute
     applied, the judge would not be entitled to fees
     because, although the JQC did not prevail on some of
     the claims under the heightened clear and convincing
     standard, the charges were not such that the JQC
     prosecutor knew or should have known lacked merit.


10. Barna v. Barna, 2003 WL 21537438
    (Fla. 4th DCA July 9, 2003).
                    Attorney represented husband in dissolution matter.
                    After dissolution was granted, the attorney filed
                    “Motion For a Declaratory Judgment, Temporary
                    Injunctive Relief, Permanent Injunctive Relief,
                    Recusal and Certiorari Because the Post dissolution
                    Permanent Spousal Support Provisions of Florida
                    Statutes Chapter 61 Violate the Florida Constitution.”
                    The trial court denied the motion and later granted the
                    former wife’s motion for fees under Section 57.105.
                    In awarding fees, the trial court rejected the attorney’s
                    argument that his actions did not require the former
                    wife’s participation and found that the motion was
                    irrelevant, frivolous, and brought only to advance the
                    cause of an unrelated client, the Alliance For Freedom
                    From Alimony, Inc. The trial court further made the
                    award without regard to the cost burden to the former
                    wife. The 4th DCA upheld the award of fees under
                    57.105.

              11.   Kerzner v. Lerman, 2003 WL 21697432 (Fla. 4th DCA
                    July 23, 2003).

                    Complaint was stricken as a sham pleading and
defendant
                    moved for attorney’s fees as sanction under Section
57.105.
                    The motion sought attorney’s fees from the plaintiff
                    but did not mention or seek fees from plaintiff’s
                    attorney. The plaintiff appealed, claiming, in part, that
                    the trial court erred in not assessing ½ of fees against
                    his lawyer. The 4th DCA affirmed the award, stating
                    that the statute allows the party to seek fees only
                    against the other party and that the defendant waived
                    her ability to seek a joint fee award against plaintiff
                    and counsel.

                    The opinion also observed that there is an ethical
concern and                        that the statute “appears to set up and
inherent
                     conflict” between the attorney and client when fees
are
                              sought. The client may be unaware that the statute
allows the                                 court to require that ½ of the fee award be
assessed against                                                           the attorney
and there is certainly no incentive for the
                              attorney to advise the client if the opposing party did
                              not request that fees to be assessed against both in the
                              motion.

								
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