Third DCA Chief Judge Leslie B. Rothenberg, Judge Barbara Lagoa and Judge Richard J. Suarez.

The Third District Court of Appeal offered a word of caution to South Florida lawyers as it branded a settlement proposal invalid and unenforceable because it “deprived” two defendants of the ability to “independently evaluate and accept” a joint offer to settle a lawsuit.

The plaintiff, Key West construction company Atlantic Civil Inc., had based its push for attorney fees on a February 2010 proposal for settlement, which asked the defendants, Key Haven Estates LLC. and its managing member Edwin O. Swift III, to pay $50,000 to settle the case.

The appellate panel slapped down the idea, considering it a joint proposal — something which appears to be a frequent thorn in the court’s side.

“We once again take the opportunity to caution counsel in our district to avoid joint proposals,” read the opinion, written by Judge Barbara Lagoa on behalf of a panel including Chief Judge Leslie B. Rothenberg and Judge Richard J. Suarez.

The ruling pointed out that the proposal was essentially asking for a $50,000 lump sum and did not “state how much either party would be required to pay to settle Atlantic’s claim on his or her own.”

What’s more, one condition of the proposal was that both defendants had to accept it for the settlement to proceed.

Though joint proposals aren’t prohibited, the court nodded toward a 2010 Florida Supreme Court ruling in Attorneys’ Title Insurance Fund Inc. v. Gorka, which found that “joint proposals have become a trap for the wary and unwary alike.”

Read the full court opinion: 

Atlantic Civil’s fight with the defendants began in 2008 during its work on a Monroe County highway construction project with the Florida Department of Transportation. Atlantic temporarily stored material used for road construction, or “fill” on land owned by Key Haven, which sparked a dispute over who owned it.

When the plaintiff’s $50,000 settlement proposal was rejected, the case went to a bench trial. Atlantic had served the proposal under Section 768.79 of the Florida Statutes and Rule 1.442, with the $50,000 set to include attorney fees.

Swift and Key Haven were initially cleared of liability on all counts by the trial court, which entered a final judgment in their favor. But as the litigation continued, the trial court ultimately ruled in Atlantic’s favor, entering an amended final judgment of $86,108.51 against the defendants.

Atlantic Civil’s motion for rehearing followed denial of a renewed motion for attorney fees. It had argued the defendants owed fees because the final judgment ended up being at least 25 percent higher than the settlement offer they had rejected.

But Swift and Key Haven opposed the motion, claiming the proposal had hinged on both parties’ acceptance, which stifled their ability to make independent decisions.

The court agreed, rendering the proposal invalid under the Gorka case, and Atlantic Civil’s argument fell apart.

Atlantic’s lawyer, Jeffrey S. Bass of Shubin & Bass in Miami, would not talk about the case, but pointed to a previous DCA ruling from July 2013, which called Swift and Key Haven’s possession of the fill material ”unjustified and deliberate.”

Kathryn L. Ender of Cole, Scott & Kissane represented Swift and Key Haven and did not respond to requests for comment before deadline.


Related stories:

Philip Morris’ ‘Militant Resistance’ Revealed in Fee Fight Documents

Appellate Court Ruling Clarifies Derivative and Direct Claims in Fee Collection

Miami Judge Approves $9.8M Settlement in Telemarketing Case