48 Fla. L. Weekly D2123a
REBECCA KNAPP, Appellant, v. HARLEY H. HARLING, Appellee. 1st District. Case No. 1D2022-2256. November 1, 2023. On appeal from the Circuit Court for Alachua County. Donna M. Keim, Judge. Counsel: Joseph W. Little, Gainesville, for Appellant. Caryn L. Bellus and Jazmine Janine L. Dykes of Kubicki Draper, P.A., Miami, for Appellee.
(OSTERHAUS, C.J.) Appellant Rebecca Knapp appeals an order from the circuit court granting attorneys’ fees and costs to Appellee Harley H. Harling in a landlord-tenant dispute under § 768.79, Florida Statutes, and Florida Rule of Civil Procedure 1.442. Knapp argues that Appellee offered her a pretrial settlement proposal that failed to satisfy the standards of § 768.79 and Rule 1.442, so that she should not have to pay Appellee’s fees and costs as a penalty. We agree and reverse because Appellee’s proposal for settlement only applied to some damages in the action and failed to “state that the proposal resolves all damages that would otherwise be awarded in a final judgment in the action” as required by Rule 1.442.I.
Appellant leased a Gainesville apartment from Appellee from 2011 until 2018. In April 2018, she stopped making monthly payments but continued to occupy the property. In June 2018, Appellee filed against Appellant a complaint for eviction for the non-payment of rent. Appellee prevailed in the action, and the court approved eviction and a judgment for back rent.
A couple months later, Appellant initiated the instant case against Appellee landlord, alleging constructive eviction, negligence, and a violation of § 83.55, Florida Statutes, for failing to comply with the terms of the rental agreement. Appellee filed an answer asserting various defenses and a counterclaim for negligent maintenance. Before trial, Appellee delivered a proposal for settlement, offering to pay Appellant $1500 if she dismissed her claims against him. Appellant rejected the offer. The case went to trial and the jury found for Appellee on both the claims and counterclaims. The final judgment granted nothing to Appellant but awarded $10,000 to Appellee on his negligence counterclaim. Appellee then sought and was awarded fees and costs arising from Appellant’s earlier rejection of his proposal for settlement under § 768.79 and Rule 1.442. Appellant timely filed a notice of appeal of the order granting fees and costs.II.
“The eligibility to receive attorney’s fees and costs pursuant to section 768.79 and Rule 1.442 is reviewed de novo.” Pratt v. Weiss, 161 So. 3d 1268, 1271 (Fla. 2015).
Section 768.79 and Rule 1.442 allow prevailing parties to collect reasonable costs and attorney’s fees as sanctions for an opposing party’s failure to accept a valid pretrial settlement offer that would terminate the litigation.
The purpose of this mechanism is to “terminate all claims, end disputes, and obviate the need for further intervention of the judicial process” by encouraging parties to exercise their “organic right . . . to contract a settlement, which by definition concludes all claims unless the contract of settlement specifies otherwise.”
MGR Equip. Corp., Inc. v. Wilson Ice Enter., Inc., 731 So. 2d 1262, 1264 (Fla. 1999). (quoting Unicare Health Facilities, Inc. v. Mort, 553 So. 2d 159, 161 (Fla. 1989)). “Generally, section 768.79 creates a right to reasonable costs and attorney fees when two prerequisites have been fulfilled: (1) a party has served a demand or offer for judgment; and (2) that party has recovered a judgment at least twenty-five percent more or less than the demand or offer.” Id. at 1263.
Here this issue is whether the proposal for settlement served by Appellee satisfied the legal standards for an award of fees and costs under § 768.79 and Rule 1.442. Both parties in this two-party case agree that for Appellant’s settlement proposal to have been valid under § 768.79 and Rule 1.442, it had to address all damages awardable in the action’s final judgment including the counterclaims. Their interpretation is consistent with Rule 1.442, which requires a proposal to “state that the proposal resolves all damages that would otherwise be awarded in a final judgment in the action in which the proposal is served.” (Emphasis added.)1
The problem here for Appellee is that his settlement proposal didn’t state that it would resolve “all damages” in the action. What is more, Appellee expressly limited his proposed settlement to resolving only Appellant’s direct claims and prospective damages against him:
This Proposal resolves all damages that would otherwise be awarded to Plaintiff in a final judgment in the action in which this Proposal is served.
This Proposal is to be construed as including any and all damages sought by Plaintiff which may be awarded to Plaintiff.
Plaintiff shall dismiss with prejudice all claims made by her against the Defendant.
Thus, the terms of Appellee’s proposed settlement didn’t address his counterclaims, or “all damages” awardable in the final judgment.2 And Appellee’s proposal wouldn’t have ended the litigation.
Appellee acknowledges that his settlement proposal didn’t expressly address his counterclaims. But he nonetheless urges us to construe his proposal as an unqualified offer that encompassed both the claims and counterclaims and all damages. Appellee cites the MGR Equipment case where the offer of judgment was not qualified and disposed “of all pending claims in the litigation including the counterclaim . . . because the offer was not qualified.” MGR Equip., 731 So. 2d at 1263-64. The MGR Equipment case is different, however, because the proposal was unqualified. This case doesn’t control Appellee’s situation, where the offer failed to “state that the proposal resolves all damages” as required Rule 1.442(c)(2)(B) and where the terms of the proposal explicitly offered to settle only Appellant’s possible damages. Indeed, Appellee’s proposal cannot be read to have encompassed “all damages” inclusive of the counterclaims because it expressly applied only to damages sought by and awardable to Appellant. See Anderson v. Hilton Hotels Corp., 202 So. 3d 846, 852 (Fla. 2016) (requiring proposals to be proposal “sufficiently clear and free of ambiguity” to allow the offeree the opportunity to fully consider the proposal). Because Appellee’s offer did not state that it would resolve all damages awardable in a final judgment, and because it only addressed damages sought by and awardable to Appellant, it failed to qualify as an MGR Equipment-like “unqualified” settlement proposal. Accordingly, we reverse the order granting Appellee’s motion for attorney’s fees and costs because his limited settlement proposal didn’t provide a basis for an award under § 768.79 and Rule 1.442.
Finally, record deficiencies keep us from accepting Appellee’s alternative argument for tipsy-coachman affirmance of the cost award under § 57.041(1). See Robertson v. State, 829 So. 2d 901, 906 (Fla. 2002) (describing that the tipsy coachman doctrine permits appellate courts to affirm if a theory or principle of law “in the record” would support such a ruling) (quoting Dade Cnty. Sch. Bd. v. Radio Station WQBA, 731 So. 2d 638, 644 (Fla. 1999)). The record simply isn’t clear that Appellee timely sought costs under § 57.041(1) or that the trial court considered him eligible to receive costs under that section. See Fla. R. Civ. P. 1.525 (requiring that a motion seeking to tax costs be served “no later than 30 days after filing of the judgment”); In re Estate of Assimakopoulos, 228 So. 3d 709, 715 n.3 (Fla 2d DCA 2017) (declining to award § 57.041 costs under the tipsy coachman doctrine because the movant didn’t seek them in the trial court and because the trial court hadn’t made necessary findings).
REVERSED. (KELSEY and LONG, JJ., concur.)
1Prior to the Florida Supreme Court’s amendment to Rule 1.442 in 2013 to require that proposals “state that the proposal resolves all damages that would otherwise be awarded in a final judgment in the action in which the proposal is made,” partial offers of settlement between offeror and offeree were permissible. See, e.g., Jacksonville Golfair, Inc. v. Grover, 988 So. 2d 1225, 1227 (Fla. 1st DCA 2008).
2The final judgment ultimately entered in this case addressed damages on both Appellant’s claims and Appellee’s counterclaims: “On plaintiff’s claim . . . Plaintiff shall take nothing and go hence without day. . . . On Defendant’s counterclaim against the Plaintiff . . . Defendant shall have and recover from the Plaintiff the principal sum of $10,000.”* * *