There’s good news and bad news for Miami attorney Arvin Peltz in his fight to collect more than $94,000 in legal fees and to avoid a nearly $53,000 fee judgment against him.
The good news: The Third District Court of Appeal Wednesday reversed the attorney fee award against Peltz. The bad: The appellate court left intact a ruling that found the defendants weren’t responsible for the five-figure debt the attorney sought to recoup. It did, however, leave the door open for Peltz to collect from another former client, in a decision that clarified derivative and direct claims.
Peltz filed suit in July 2013 against Coral Gables-based Trust Hospitality LLC and Trust Hospitality International LLC, whose marketing material show they operate branded hotels in the U.S., Caribbean and Latin America. His complaint alleged the defendants accumulated $94,315 in legal bills but never paid their debt.
But the hotel management companies argued they never hired Peltz. Their answer and affirmative defenses claimed the attorney worked for another defendant, Tecton Management Services Co., which paid him in full. Their court pleadings claimed Peltz agreed to accept $67,500 from Tecton to satisfy the debt.
Peltz claimed the Trust Hospitality companies took control of Tecton’s daily operations, and therefore benefited from his work. He rejected a $10,001 joint settlement offer, which he said violated Florida Rule of Civil Procedure 1.442(c)(3) by not dividing liability between the Trust Hospitality companies.
The defendants successfully argued at trial that any responsibility they had to Peltz was derivative of his work for Tecton—not direct. They claimed an exception in a related rule, 1.442(c)(4), freed them of any requirement to assign liability.
The companies then sought attorney fees and costs for the rejected proposal, winning a $53,000 judgment.
But that was a misstep, according the the appellate court.
“Appellees … misapprehend rule 1.442(c)(4)’s exception to rule 1.442(c)(3)’s apportionment requirement,” Judge Edwin A. Scales III wrote for the Third DCA. “In this case, the exception would apply only if Peltz had alleged that appellees/co-offerors’ liability was exclusively derivative in nature, i.e., their liability for Tecton’s debt arose by operation of law, rather than as a result of any act or omission of the offerors.”
In other words, the appellate court found Peltz’s claims were direct, and he was right to challenge the settlement’s validity.
The panel then reversed the fee award against the attorney.
The Trust Hospitality companies “prevailed in this case because they were not responsible, derivatively or otherwise, for Peltz’s claims against Tecton,” Scales wrote in a unanimous decision with Third DCA Judges Richard J. Suarez and Norma S. Lindsey. “In fact, Peltz may still recover a judgment against Tecton, despite Peltz’s claims against appellees having been dismissed.”
Larry Bassuk and Brian L. Elstein of Leto Bassuk in Miami represented Trust Hospitality on appeal. They did not respond to requests for comment by press time.
Peltz represented himself.