MV SENIOR MANAGEMENT LLC v. REDUS FLORIDA HOUSING LLC (2020)

In 2016, Hilda Gelfman, a resident at an assisted living facility in Jacksonville, sued Appellant, MV Senior Management, LLC, the facility's management company, and Appellee, Redus Florida Housing, LLC, the facility's owner, for negligence that she alleges caused her to contract Legionnaire's disease. Relying on a property management agreement between itself and MV Senior, Redus Florida asserted a crossclaim against MV Senior for indemnity and breach of contract for failing to indemnify Redus Florida against Gelfman's claims. On appeal, MV Senior argues that the trial court erred in granting Redus Florida's attorneys’ fees incurred in asserting its crossclaim against MV Senior for breach of contract. For the reasons discussed below, we reverse the attorneys’ fees award and affirm in all other respects.

Florida courts follow the “American rule,” meaning that unless a contract or statute provides for attorneys’ fees, a court may not award them. State Farm Fire & Cas. Co. v. Palma, 629 So. 2d 830, 832 (Fla. 1993). See also Azalea Trace, Inc. v. Matos, 249 So. 3d 699 (Fla. 1st DCA 2018); R.J. Reynolds Tobacco v. Ward, 141 So. 3d 236 (Fla. 1st DCA 2014); Thompson v. Hodson, 825 So.2d 941 (Fla. 1st DCA 2002); Strader v. Oakley, 410 So. 2d 954 (Fla. 1st DCA 1982).

A narrow exception to the American rule is the “wrongful act doctrine,” whereby “the wrongful act of the defendant has involved the claimant in litigation with others, and has placed the claimant in such relation with others as makes it necessary to incur expenses to protect its interest, such costs and expenses, including reasonable attorney's fees upon appropriate proof, may be recovered as an element of damages.” Reiterer v. Monteil, 98 So. 3d 586, 588 (Fla. 2d DCA 2012). This court's decision in Earth Tech echoes this theory of recovery. Capitol Envtl. Servs., Inc. v. Earth Tech, Inc., 25 So. 3d 593, 598 (Fla. 1st DCA 2009) (explaining that attorneys’ fees are recoverable when, “but for” the breaching party's tortious conduct, the non-breaching party would not have been required to expend attorneys’ fees to defend litigation against a third party).

This case does not meet the standard for recovery under the wrongful act doctrine because the focus of the litigation, and the basis for the award of fees, arose solely from the contractual relationship between MV Senior and Redus Florida. Redus Florida was awarded attorneys’ fees incurred in litigation against MV Senior for fees incurred as a result of the parties’ dispute over their contract. Stated differently, none of the fees awarded were due to litigation with a third party, such as Gelfman. Courts applying this doctrine have recognized its applicability only when litigation ensuing from a party's wrongful act was against a third party—not directly against the defendant. See Grasso v. Grasso, 131 F. Supp. 3d 1303, 1309 (M.D. Fla. 2015) (applying Florida law); Robbins v. McGrath, 955 So. 2d 633, 634 (Fla. 1st DCA 2007); Schwartz v. Bloch, 88 So. 3d 1068, 1071 (Fla. 4th DCA 2012). Here, although Redus Florida was involved in litigation that included a third party, Gelfman, it is not claimed that Gelfman's litigation entitled Redus Florida to fees under the “wrongful conduct” exception against MV Senior. Instead, Redus Florida seeks fees based solely on MV Senior having breached their contract, one that has no attorneys’ fees provision. Because no contractual or statutory authorization provides for the recovery of attorneys’ fees, and the wrongful act doctrine does not apply, Redus Florida is not entitled to recovery of fees.

Reversed.

PER CURIAM.

Makar, Osterhaus, and M.K. Thomas, JJ., concur.