41 Fla. L. Weekly D2269aTop of Form

Contracts
— Liens — Appeals — Breach of contract action by subcontractor against
contractor alleging, in first count, that contractor failed to pay
subcontractor for additional work performed by subcontractor due to unexpected
conditions, and against contractor and surety on lien transfer bond, in second
count, for recovery on bond — Because order dismissing claim against surety
disposes of all claims against surety, the order is appealable as a partial
final judgment — Orders granting summary judgment in favor of contractor on
breach of contract claim and claim for recovery under lien are nonfinal and
nonappealable because those claims are interrelated with remaining claims
against contractor and contractor’s counterclaim for alleged fraudulent lien —
Subcontractor is entitled to certiorari review of ruling in favor of contractor
on claim to recover under lien because subcontractor might be subject to
irreparable harm if it were required to wait until end of litigation to appeal
issue — It was error to enter summary judgment for surety on claim seeking to
recover on lien transfer bond on basis that lien was fraudulent where there was
factual issue as to whether subcontractor willfully overstated the amount claimed
in the lien — Order granting summary judgment for contractor on claim for
recovery under lien was a departure from essential requirements of law

GATOR BORING & TRENCHING,
INC., Appellant, v. WESTRA CONSTRUCTION CORP., a Florida corporation; TRAVELERS
CASUALTY AND SURETY COMPANY OF AMERICA, a Connecticut company; and TAMPA
ELECTRIC COMPANY, Appellees. 2nd District. Case No. 2D15-5453. Opinion filed
October 5, 2016. Appeal from the Circuit Court for Sarasota County; Peter A.
Dubensky, Judge. Counsel: Charles P. Young of Emmanuel, Sheppard & Condon,
Pensacola, for Appellant. George E. Spofford, IV, and William F. McFetridge,
IV, of GrayRobinson, PA, Tampa, for Appellees Westra Construction Corp. and
Travelers Casualty and Surety Company of America. No appearance for Appellee
Tampa Electric Company.

(WALLACE, Judge.) Gator
Boring & Trenching, Inc. (Gator), seeks appellate review of an adverse
partial summary judgment on claims that it asserted for breach of contract
against Westra Construction Corp. (Westra) and for the recovery on a lien
transfer bond against both Westra and its surety, Travelers Casualty and Surety
Company of America (Travelers). The issues we are called upon to decide raise
complex questions about our jurisdiction and the propriety of the entry of
summary judgment in favor of Westra and Travelers on their defense that the
lien filed by Gator was fraudulent within the meaning of the Construction Lien
Law.1 We dismiss Gator’s appeal in part,
reverse the orders granting the partial summary judgment in part, grant
certiorari relief, and quash in part the orders under review.

I. THE FACTUAL AND

PROCEDURAL BACKGROUND

Westra contracted with Tampa
Electric Company (TECO) to build a fourteen-mile long pipeline in Polk County.2 Westra subcontracted the horizontal
directional drill portion of the project passing under the Alafia River to
Gator. When Gator entered into the subcontract, it apparently believed that the
scope of the work would require it to drill exclusively or primarily through
sand. After commencing the work, Gator found that completion of its portion of
the project required it to drill through a substantial amount of rock. The
necessity to drill through rock instead of sand substantially increased the
cost of the contracted work to Gator. After Gator completed its portion of the
project, Westra and TECO did not pay Gator all of the monies that it claimed
were due. Gator timely filed a claim of lien in the Public Records of Polk
County, Florida.

The total amount of the claim
that Gator asserted against Westra and Travelers on its construction lien was
$889,792.70. Of this amount, $676,556.903 represented the damages that Gator
claimed as a result of the additional costs incurred by it in drilling through
the unanticipated rock formation. The remainder, $213,235.80, was for balances
due on invoices and amounts for retainage that Gator claimed were unpaid under
its subcontract.

In count I of its first
amended complaint, Gator sued Westra for breach of contract based upon Westra’s
alleged failure to pay Gator for the work it had performed under its
subcontract with Westra. The amount claimed by Gator on its breach of contract
claim against Westra was $1,031,869.65. The amounts sought by Gator for the
alleged breach of contract in count I of its complaint included the additional
cost of drilling through rock instead of sand as well as other amounts that
Gator claimed to be due and unpaid. A detailed analysis of the additional
amounts claimed by Gator on count I is not pertinent to our consideration of
the issues in this case.

After Gator filed its lien to
secure recovery of the amounts it claimed against Westra and TECO, Westra
promptly transferred the lien to a bond underwritten by Travelers. In count II
of the first amended complaint, Gator sought to recover the $889,792.70 from
Westra and Travelers on the lien transfer bond.4

Westra and Travelers filed a
motion for partial summary judgment on count I and for dismissal of count II of
Gator’s first amended complaint to the extent that those counts sought damages
or relief based upon Westra’s failure to pay for the additional work that Gator
allegedly performed as a result of the changed conditions at the job site. In
the motion, Westra argued that partial summary judgment should be granted on
count I because Gator’s subcontract precluded Gator from receiving additional
money from Westra merely because the work was more difficult and costly than
anticipated. Westra asserted that, as a matter of law, Gator accepted the risk of
changed site conditions because its contract did not include a changed
conditions clause. Furthermore, Westra relied on the provisions in the contract
documents that it claimed expressly stated that Gator had investigated the
site, accepted the risk that conditions might be different than anticipated,
and would not be entitled to additional compensation if the work turned out to
be more difficult and costly than expected.

Westra and Travelers raised
as their twelfth affirmative defense in their amended affirmative defenses to
Gator’s first amended complaint their claim that Gator’s lien was fraudulent
and unenforceable under section 713.31(2), Florida Statutes (2013). Based upon
this affirmative defense, Westra and Travelers asserted in their motion for partial
summary judgment that count II should be dismissed upon the entry of a judgment
on Gator’s changed conditions claim in count I. They argued that Gator’s lien
was fraudulent and unenforceable because the lien included $676,556.90 for the
changed conditions claim, for which Gator could not properly recover.

Following a hearing, the
trial court entered an order granting the motion for partial summary judgment
without elaboration. Thereafter, Gator filed a motion for clarification,
pointing out that in the motion for partial summary judgment, Westra sought
partial summary judgment on Gator’s changed conditions claim, which was
included in count I, and that Westra and Travelers sought dismissal of count II
based on their claim that Gator’s lien was exaggerated as a matter of law.
Gator stated that the parties had conflicting interpretations about the effect
of the trial court’s order and requested that the trial court clarify its
ruling.

The trial court entered an
order granting the motion for clarification. The order stated that the motion
for partial summary judgment was granted based on the argument that Gator could
not recover any additional monies on its changed conditions claim. The trial
court amended its prior order to include additional findings and rulings as
follows: (1) that the subcontract did not include a differing site conditions
clause; (2) that Gator assumed the risk of the differing site conditions; (3)
that Gator’s $889,792.70 lien included a claim for $676,556.90 as compensation
for the differing site condition claim; (4) that Gator exaggerated its lien in
the amount of $676,556.90 for the claim for differing site conditions, which
was not a minor amount; (5) that Gator did not present evidence that it had
consulted with legal counsel or disclosed to counsel all material facts before
filing the lien; (6) that the lien recorded in the Polk County Public Records
was dismissed; (7) that the clerk was directed to release the lien transfer
bond provided by Travelers; and (8) that count II of the amended complaint was
dismissed. Gator timely appealed both orders.

II. THE QUESTION OF
JURISDICTION

A. Introduction

The pleadings reflect that
the two orders on appeal have effectively disposed of the only claim involving
Travelers, which was alleged in count II of the first amended complaint.
However, count I includes claims for other damages against Westra in addition
to the claim based on the changed site conditions. These claims remain pending.
Also, Westra filed a counterclaim under section 713.31(2)(c) for the alleged
fraudulent lien against Gator that is unaffected by the orders under review.
With these facts concerning the state of the pleadings in mind, we must
consider the question of our jurisdiction separately as it relates to the
claims asserted against Travelers and Westra.

B. Travelers

Florida
Rule of Appellate Procedure 9.110(k) provides as follows:

Except as otherwise provided herein, partial final judgments
are reviewable either on appeal from the partial final judgment or on appeal
from the final judgment in the entire case. A partial final judgment, other
than one that disposes of an entire case as to any party, is one that disposes
of a separate and distinct cause of action that is not interdependent with
other pleaded claims. If a partial final judgment totally disposes of an entire
case as to any party, it must be appealed within 30 days of rendition.

Because the trial court’s
orders completely dispose of all claims involving Travelers, we have
jurisdiction to review Gator’s appeal from the dismissal of count II as a
partial final judgment in accordance with rule 9.110(k). See Behavioral
Healthcare Options, Inc. v. Charter Behavioral Health Sys. of Tampa Bay, Inc.,
727 So. 2d 1135, 1136 (Fla. 2d DCA 1999) (holding that the dismissal of the
claims brought by a professional association against appellees was a final
appealable order under rule 9.110(k) because no other counts remained in which
the association was a party). Accordingly, we will address the orders
dismissing count II in favor of Travelers as a final order on appeal.

C. Westra

The trial court’s orders are
nonfinal and nonappealable to the extent that they grant a partial summary
judgment in favor of Westra on count I (on the changed conditions claim) and
count II because those claims are interrelated with the remaining claims
against Westra under count I and Westra’s counterclaim for an alleged
fraudulent lien. See id. (holding that an order of dismissal as
it related to claims that were interrelated with the claims remaining against a
party was nonfinal and nonappealable); see also East Ave., LLC v.
Insignia Bank, 136 So. 3d 659, 661 (Fla. 2d DCA 2014) (noting same); Merkle
v. Home Shopping Network, Inc., 916 So. 2d 841, 843 (Fla. 2d DCA 2005)
(noting same). Thus, we must dismiss Gator’s appeal to the extent it challenges
the trial court’s partial summary judgment concluding that Gator cannot recover
under count I on its changed conditions claim against Westra as a matter of
law.5

The analysis concerning
Gator’s appeal from the trial court’s rulings in favor of Westra on count II is
more complicated. As noted above, the trial court dismissed count II based upon
its finding that Gator had exaggerated its lien by including $676,556.90 in
damages alleged on its changed conditions claim that was asserted in count I.
In its order, the trial court dismissed Gator’s lien, directed the clerk to
release the lien transfer bond provided by Travelers, and dismissed count II
seeking a recovery against the lien transfer bond.

As noted above, the dismissal
of count II in favor of Westra is nonfinal and nonappealable under the
traditional rules of finality of judgments because interrelated claims remain
pending against or by Westra. However, we conclude that Gator is entitled to certiorari
review of this issue because Gator might be subject to irreparable harm if it
were required to wait until the end of the litigation to appeal this issue. See
East Ave., 136 So. 3d at 661 (granting certiorari review on an appeal
from a nonfinal order awarding a partial summary judgment for damages and
authorizing execution on the judgment because the appellant would otherwise be
“exposed to enforcement of [a] judgment at a time when it cannot obtain review
of it [or] . . . shield its assets . . . by posting an appellate supersedeas
bond”). If we affirm the trial court’s order dismissing count II in favor of
Travelers and releasing the bond, Gator would lose the benefit of a recovery
under the bond on that claim if we later reversed the dismissal of count II in
favor of Westra. In that circumstance, Gator would be without a remedy on the
bond. Accordingly, we may review under our certiorari jurisdiction the trial
court’s dismissal of count II in favor of Westra. See id. at 665;
see also Fla. R. App. P. 9.040(c) (“If a party seeks an improper remedy,
the cause shall be treated as if the proper remedy had been sought; provided
that it shall not be the responsibility of the court to seek the proper
remedy.”)

III. DISCUSSION

A. Consideration of the
Partial Summary Judgment as to Travelers

Although the trial court
stated that it was dismissing count II of the first amended complaint seeking
to recover on the lien transfer bond, the trial court actually granted a
summary judgment on this count. The legal analysis of count II involved
application of the law to summary judgment facts, not just the allegations in
the first amended complaint, and was more like a summary judgment than a
dismissal.

The
function of a motion to dismiss a complaint is to raise as a question of law
the sufficiency of the facts alleged to state a cause of action.
For the purpose of passing upon a motion to dismiss the Court must assume all
facts alleged in the complaint to be true. Consequently a motion to dismiss a
complaint must be decided on questions of law and questions of law only.

On
the other hand a motion for summary judgment . . . raises only questions of
[f]act and must be decided upon evidence and not pleadings.

The
purpose of a motion to dismiss is to ascertain if the plaintiff has alleged a
good cause of action. The purpose of a motion for summary judgment is to
determine if there be sufficient evidence to justify a trial upon the issues
made by the pleadings. They thus serve entirely different functions.

Connolly v. Sebeco, Inc., 89 So. 2d 482, 484 (Fla.
1956).

We review a final order
granting summary judgment de novo. Smith v. Frontier Commc’ns Int’l, Inc.,
805 So. 2d 975, 977 (Fla. 2d DCA 2001). On a motion for summary judgment, the
moving party must show that there are no genuine issues of material fact and
that it is entitled to summary judgment as a matter of law. Cerron v. GMAC
Mortg., LLC, 93 So. 3d 456, 457 (Fla. 2d DCA 2012). Until the moving party
meets this burden, there is no duty on the nonmoving party to demonstrate the
existence of a genuine issue of material fact. Smith, 805 So. 2d at 977.
Further, “[i]f the record reflects the existence of any genuine issue of
material fact, or the possibility of any issue, or if the record raises even
the slightest doubt that an issue might exist, summary judgment is improper.” Cook
v. Bay Area Renaissance Festival of Largo, Inc., 164 So. 3d 120, 122 (Fla.
2d DCA 2015) (quoting Schmidt v. State Farm Mut. Ins. Co., 750 So. 2d
695, 698 (Fla. 2d DCA 2000)).

With respect to remedies for
fraud or collusion in a construction lien, section 713.31 provides, in
pertinent part, as follows:

(2)(a) Any lien asserted under this part in which the lienor
has willfully exaggerated the amount for which such lien is claimed . .
. or in which the lienor has compiled his or her claim with such willful and
gross negligence as to amount to a willful exaggeration shall be deemed a
fraudulent lien.

(b) It is a complete defense to any action to enforce a
lien under this part, or against any lien in any action in which the validity
of the lien is an issue, that the lien is a fraudulent lien; and the court
so finding is empowered to and shall declare the lien unenforceable, and the
lienor thereupon forfeits his or her right to any lien on the property upon which
he or she sought to impress such fraudulent lien. However, a minor mistake
or error in a claim of lien, or a good faith dispute as to the amount due does
not constitute a willful exaggeration that operates to defeat an otherwise
valid lien.

(c) An owner against whose interest in real property a
fraudulent lien is filed, or any contractor, subcontractor, or
sub-subcontractor who suffers damages as a result of the filing of the
fraudulent lien, shall have a right of action for damages occasioned thereby. The
action may be instituted independently of any other action, or in connection
with a summons to show cause under s. 713.21, or as a counterclaim or
cross-claim to any action to enforce or to determine the validity of the lien.

(Emphasis added.) Thus, under
section 713.31(2), “[a] claim of lien that overstates the amount claimed is not
necessarily fraudulent, unless the exaggeration [was] made willfully.” Sam
Rodgers Props., Inc. v. Chmura, 61 So. 3d 432, 440 (Fla. 2d DCA 2011)
(citing Sharrard v. Ligon, 892 So. 2d 1092, 1097 (Fla. 2d DCA 2004)).

The party asserting that a
claim of lien is fraudulent bears the burden of proving that the lien is
fraudulent. Sam Rodgers Props., 61 So. 3d at 439-40. Further, “a finding
of a fraudulent lien by a trial court is not a discretionary matter. As with
any other contested issue, the lienor’s intent and good or bad faith in filing
a lien must be based on competent substantial evidence in the record.” Delta
Painting, Inc. v. Baumann, 710 So. 2d 663, 664 (Fla. 3d DCA 1998); see
also Sam Rodgers Props., 61 So. 3d at 440 (recognizing that “[a]
lienor’s good or bad faith in filing a lien must be based on competent,
substantial record evidence”). Thus, in order to be entitled to summary
judgment on count II, Travelers had to establish that there remained no genuine
issue of material fact that Gator had willfully overstated the amount claimed
in its lien as a matter of law. Travelers failed to meet this burden.

Here, Travelers did not
establish the lack of any genuine issue of material fact on its defense that
Gator’s lien was fraudulent. Rather, Travelers argued, and the trial court
accepted, that Gator’s lien was fraudulent and unenforceable based upon a
misapplication of the law. The sole basis asserted by Travelers for its fraudulent
lien defense was that Gator lost on its claim against Westra for additional
expenses resulting from its encounter with the unanticipated rock in the path
of its drilling operation. Because Gator included an amount for this claim in
its lien, Travelers argued, the lien was exaggerated as a matter of law.
Travelers did not point to any record evidence to establish that Gator
willfully exaggerated its lien by intentionally including amounts that were not
recoverable or that it included an amount for changed site conditions in bad
faith. Rather, it argued that because Gator’s lien included $676,556.90 on its
claim for additional work caused by changed conditions, the trial court’s grant
of a summary judgment on that claim automatically established that the lien was
fraudulent and unenforceable.

In concluding that the lien
was fraudulent and unenforceable as a matter of law, the trial court apparently
accepted the foregoing argument. It further found that $676,556.90 was not a
minor amount when the total amount of the lien was $889,792.70. See §
713.31(2)(b) (“[A] minor mistake or error in a claim of lien . . . does not
constitute a willful exaggeration that operates to defeat an otherwise valid
lien”). In addition, the trial court observed that “Gator did not present any
evidence that Gator consulted with legal counsel and disclosed all material
facts to counsel prior to filing the lien.” See Sharrard, 892 So.
2d at 1097 (noting that “[a] lienor’s consultation with counsel prior to filing
a claim of lien tends to establish that the lienor acted in good faith” and “is
a factor to be considered along with other pertinent factors”).

The reasoning that Gator’s
lien was fraudulent as a matter of law simply because it lost on its changed
conditions claim is erroneous. A “dispute between the parties as to the amount
of compensation due according to the contract plan of compensation or even a
dispute as to the method of compensation provided in the contract does not
convert such a good faith dispute into a fraudulent lien as provided in section
713.31.” Vinci Dev. Co. v. Connell, 509 So. 2d 1128, 1132 (Fla. 2d DCA
1987). Moreover, simply because a court reduces the amount of a lien does not
render the lien fraudulent. Politano v. GPA Constr. Grp., 9 So. 3d 15,
16 (Fla. 3d DCA 2008); see also Delta Painting, Inc., 710 So. 2d
at 665 (Cope, J., dissenting) (observing that “[b]y eliminating from the
fraudulent lien statute good faith contract disputes and minor mistakes or
errors, the Legislature intended to reserve fraudulent lien penalties for those
cases where there was a willful, intentional exaggeration or assertion of a
claim for which there was no good-faith basis. . . . [A] lien is not to be
deemed fraudulent merely because it is not embodied in a written contract or
change order, so long as there is a good-faith basis for the claim”).

The record and the parties’
briefs reflect that Gator’s claim that it was entitled to recover additional
monies from Westra as a result of the changed site conditions was a hotly
contested and complex issue involving the legal construction of Gator’s
subcontract and other documents as well as an analysis of the law concerning
the assumption of the risk for differing site conditions. Gator’s first amended
complaint asserting its claim for damages for the changed site conditions and
its claim on the lien transfer bond including those damages was filed by Gator’s
attorney. Thereafter, the parties engaged in substantial discovery and legal
analysis before Westra and Travelers filed their motion for partial summary
judgment concerning Gator’s entitlement to payment on its changed site
conditions claim. Moreover, the trial court did not find that Gator’s changed
condition claim was frivolous or wholly without merit. The parties’ pleadings
reflect that they had a genuine dispute about Gator’s entitlement to payment on
its changed conditions claim, for which Gator was represented by counsel. In
addition, the record on appeal reflects that Gator’s claim of lien was, in
fact, prepared by Gator’s counsel.6

We conclude that the trial
court erred in finding that Travelers was entitled to summary judgment on count
II. In their argument on the motion for partial summary judgment on count II,
Westra and Travelers relied solely on the ground that a determination by the
trial court that Gator was not entitled to recover on its changed conditions
claim made Gator’s claim of lien fraudulent and unenforceable. This view —
which the trial court adopted — is based on an incorrect application of the
law. Viewed in the light most favorable to Gator, the record reflects that the
parties had a genuine dispute about Gator’s right to recover on its changed
conditions claim. Travelers failed to conclusively establish that Gator
willfully exaggerated the amount of its lien by including that claim.
Accordingly, the trial court erred in directing the clerk to release the lien
transfer bond and in dismissing count II in favor of Travelers. The question of
whether Gator’s lien is fraudulent within the meaning of section 713.31 is an
issue of fact that remains to be decided at trial. See J.W. Rolle
Dev. Corp. v. Neuman, 910 So. 2d 349, 350 (Fla. 4th DCA 2005) (holding that
the question of whether a contractor had filed a fraudulent lien by willfully
exaggerating the amount was an issue of fact that should not have been
determined on summary judgment).

B. Consideration of the
Partial Summary Judgment as to Westra

Having concluded that Gator
is entitled to review by certiorari of the orders to the extent they dismiss
count II in favor of Westra, we must determine whether the trial court’s ruling
constituted a departure from the essential requirements of the law. See East
Ave., LLC v. Insignia Bank, 136 So. 3d 659, 665 (Fla. 2d DCA 2014). A
departure from the essential requirements of the law means “a violation of a
clearly established principle of law resulting in a miscarriage of justice.” Allstate
Ins. Co. v. Kaklamanos, 843 So. 2d 885, 889 (Fla. 2003). For the reasons
discussed above, we conclude that the dismissal of the lien and count II in
favor of Westra constituted a departure from the essential requirements of law.
The trial court erroneously concluded that its granting of a summary judgment
against Gator on its changed conditions claim automatically rendered its lien
on that claim (as well as others) to be fraudulent and unenforceable as a
matter of law when the record reflects that the parties had a genuine dispute
about Gator’s entitlement to payment on its changed conditions claim. The law
is clearly established that the reduction in the amount of a lien following a
good faith dispute about the amount the lienor may recover under a contract
does not render the lien fraudulent as a matter of law. See §
713.31(2)(b); see also Politano, 9 So. 3d at 16; Vinci,
509 So. 2d at 1132. Accordingly, we grant certiorari relief and quash the trial
court’s orders to the extent they dismiss Gator’s lien and count II in favor of
Westra.

IV. CONCLUSION

For the foregoing reasons, we
dismiss Gator’s appeal as nonfinal and nonappealable to the extent that it
seeks review of the trial court’s orders granting a summary judgment in favor
of Westra on Gator’s changed conditions claim in count I. We reverse the trial
court’s orders to the extent they release the lien transfer bond and dismiss
count II in favor of Travelers. In addition, we grant certiorari relief to
Gator and quash the trial court’s orders to the extent they dismiss Gator’s
lien and claim on the lien transfer bond in count II in favor of Westra.

Dismissed in part, reversed
in part, and orders quashed in part. (VILLANTI, C.J., and BLACK, J., Concur.)

__________________

1§§
713.001-.37, Fla. Stat. (2013).

2The
facts stated in this opinion are drawn from the pleadings, the answers to
interrogatories, the responses to requests for admissions, the affidavits, and
the other documents in the record. We examine these facts in the light most
favorable to Gator as the party against whom the partial summary judgment was
entered. See Markowitz v. Helen Homes of Kendall Corp., 826 So.
2d 256, 259 (Fla. 2002).

3Various
pleadings in the record report this amount as $676,556.00. However, we
have referred to the amount as $676,556.90 because that is the amount
reflected in the trial court’s order granting clarification and because that is
the amount reflected in Gator’s answers to Westra’s second interrogatories in
which Gator itemized and totaled its additional costs for boring through the
unforeseen rock.

4Count
III of the first amended complaint alleges an unjust enrichment claim against
TECO based upon its alleged receipt of a benefit from Gator’s furnishing of
labor and materials for the project. Count IV alleges a claim for quantum
meruit against TECO on the basis that Gator provided the requested labor and
material for the benefit of TECO and that the labor and materials had a
reasonable value for which TECO had failed to pay. The orders under review did
not address counts III and IV, and those counts are not at issue in this case.

5Because
we are dismissing Gator’s appeal of the trial court’s adverse ruling on the
changed conditions claim asserted in count I of the amended complaint, we
express no opinion on the merits of that claim.

6Gator’s
claim of lien bears the following statement: “This document prepared by:
Charles P. Young, Emmanuel, Sheppard, & Condon, 30 South Spring Street,
Pensacola, FL 32503.” Mr. Young filed the first amended complaint on behalf of
Gator and represents Gator in this appeal.

* * *