David Lee HAM, Jr., Appellant,
v.
NATIONSTAR MORTGAGE, LLC, Appellee.

No. 1D14-4024.District Court of Appeal of Florida, First District.May 12, 2015.715*715 David Lee Ham, Jr., pro se, Appellant.

Nancy M. Wallace and Michael J. Larson of Akerman LLP, Tallahassee, and William P. Heller of Akerman LLP, Fort Lauderdale, for Appellee.

BILBREY, J.

Appellant, David Lee Ham, Jr., appeals the final judgment of foreclosure entered in favor of Nationstar Mortgage, LLC. Because the evidence of the original plaintiff’s standing to enforce the note was insufficient to support the final judgment, we reverse.

The lawsuit commenced on February 7, 2008, upon the filing of the complaint by Aurora Loan Services, LLC. In Count I, Aurora alleged that it sought to “reestablish a promissory note under Section 673.3091, Florida Statutes,” that it was the owner of the note, and that it “was in possession of the promissory note and was entitled to enforce it when loss of possession occurred.” Aurora specifically alleged that the “note is not in the custody or control of Plaintiff.” Count II was for foreclosure of the mortgage securing the note. Attached to the complaint was a mortgage naming Appellant as the borrower and 123Loan, LLC as the lender. The mortgage described a note dated August 17, 2004, establishing a debt owed by Appellant to 123Loan for $50,000.00. However, no note (and thus, no indorsement), no assignment of the note, and no affidavit of ownership of the note was attached to the complaint.

In his answer to the complaint, Appellant denied the allegations that Aurora was the owner of the note, that the note was lost subsequent to Aurora’s acquisition of it, and that Aurora was entitled to enforce the note at the time it was lost.

716*716 More than three years after the original complaint was filed, Aurora moved for leave to amend its complaint and the court granted the motion. Aurora filed its Verified Amended Complaint on June 7, 2011. The amended complaint dropped the lost note count and consisted of only one count, for foreclosure. Aurora alleged that it was the servicing agent, the designated holder of the note, and that the note and mortgage had been in default since October 1, 2007. Attached to the amended complaint was a “Corporate Assignment of Mortgage” dated April 9, 2008, assigning the mortgage “together with the Note” from Mortgage Electronic Registration Systems (“MERS”) to Aurora. Also attached was a copy of the Note, each page of which was stamped with a certification that it was a “true and correct copy of the original” and initialed by an unknown person. The copy of the Note was dated August 17, 2004, and listed 123Loan as the lender and Mr. Ham as the borrower. After the signature page of the Note, an undated indorsement in blank (no designated payee) was attached, signed by the Vice President of 123Loan, LLC. This blank endorsement made the Note payable to the bearer. See § 673.2051(2), Fla. Stat.

Appellant’s answer to the amended complaint denied that Aurora was the holder of the note, denied that the mortgage was in default, and asserted the affirmative defense that Aurora lacked standing to sue for foreclosure, both at the time the original complaint was filed and when the amended complaint was filed. In support of this affirmative defense, Appellant asserted that the “Corporate Assignment of Mortgage” from MERS to Aurora was executed only after the filing of the original complaint. Appellant also challenged the Corporate Assignment because the assignor was MERS, not 123Loan.

By order entered June 12, 2012, upon Aurora’s motion for substitution, the court substituted Nationstar as the party plaintiff. A second Corporate Assignment of Mortgage (from Aurora to Nationstar) was attached to Aurora’s motion. The second corporate assignment provided an effective date of July 1, 2012, and addressed only the mortgage, without reference to the note.

Following Appellant’s unsuccessful motions to dismiss and for summary judgment, the bench trial took place on August 28, 2014. The final judgment of foreclosure was entered that same day in favor of Nationstar in the amount of $83,566.18. Appellant filed a timely appeal of the final judgment.

This Court’s scope of review is somewhat limited by the failure of Appellant to provide a transcript of the bench trial. However, unlike the appeal in Applegate v. Barnett Bank of Tallahassee, 377 So.2d 1150 (Fla.1979), where no transcript of the bench trial and no “proper substitute” was supplied by the appellant, the scope of our review is not limited to the face of the final judgment. Here, Appellant prepared a statement of the evidence or proceedings and Nationstar submitted objections and proposed amendments to that statement. Fla. R. App. P. 9.200(b)(4). The trial court approved Nationstar’s objections and amendments and disapproved Appellant’s statement. Accordingly, the evidentiary record before us consists of the approved statement of the evidence and proceedings and the numerous documents admitted into evidence in the record. See Soto v. Soto, 974 So.2d 403, 404 (Fla. 2d DCA 2007) (“Thus, as the evidentiary record, we have before us the twelve-page statement of the evidence, along with numerous financial exhibits.”).

The lack of a transcript of the final hearing prevents this Court from reviewing 717*717the trial court’s exercise of its discretion to admit or exclude evidence such as the testimony of the witness as described in the statement of the evidence, Nationstar’s business records, and Appellant’s excluded financial records. In order to preserve an evidentiary ruling for appellate review, a contemporaneous objection on the specific legal ground raised on appeal must be made in the trial proceedings, and the objecting party must obtain a ruling by the trial court for the appellate court to review.See State v. Currilly, 126 So.3d 1244, 1245 (Fla. 1st DCA 2013). The preservation rule applies in both criminal and civil cases. See Universal Ins. Co. of N. Am. v. Warfel, 82 So.3d 47, 64 (Fla.2012) (applying rule in civil proceedings); Aills v. Boemi,29 So.3d 1105 (Fla.2010) (same). The absence of a transcript of the final hearing precludes our consideration of whether sufficiently specific objections to admission or exclusion of evidence were made so as to inform the trial court of the perceived evidentiary errors. See Aarmada Protection Systems 2000, Inc. v. Yandell, 73 So.3d 893, 898 (Fla. 4th DCA 2011) (“absent a transcript of the hearing on the motion in limine, we must affirm a ruling [on the motion] that is not fundamentally erroneous on its face.”).

The statement of evidence and proceedings, as approved by the trial court, refers generally to Appellant’s objections “to the introduction of evidence” which were “all overruled, including objections as to hearsay, authentication, and relevance.” However, unlike the record in Burdeshaw v. Bank of New York Mellon, 148 So.3d 819 (Fla. 1st DCA 2014), which contained a complete transcript of the final hearing, the bald reference in the statement of evidence in this case provides no particulars of the context or specifics of any hearsay argument, such as the application of the business records exception to the hearsay rule or the qualifications of the witness to testify about any business records under section 90.803(6), Florida Statutes. The record in this case is not sufficient to preserve for appellate review any challenge to the admission or exclusion of documents or testimony at the bench trial.

While particular evidentiary objections and rulings were not preserved for appellate review, Appellant’s challenge to the sufficiency of the evidence of Nationstar’s standing is cognizable in this appeal. Rule 1.530(e), Florida Rules of Civil Procedure provides that when “an action has been tried by the court without a jury, the sufficiency of the evidence to support the judgment may be raised on appeal whether or not the party raising the question has made any objection thereto in the trial court or made a motion for rehearing, for new trial, or to alter or amend the judgment.” See Burdeshaw (applying rule 1.530(e) to appeal of final judgment of foreclosure);Lacombe v. Deutsche Bank Nat’l Trust Co., 149 So.3d 152, 153 (Fla. 1st DCA 2014)(same).

The standard of this court’s review of the sufficiency of the evidence to prove standing to bring a foreclosure action is de novo. Pennington v. Ocwen Loan Servicing, LLC, 151 So.3d 52, 53 (Fla. 1st DCA 2014).

The documents in the record clearly establish that the original plaintiff, Aurora, was not the original lender. The law is firmly settled that “[a] plaintiff who is not the original lender may establish standing to foreclose by submitting a note with a blank or special indorsement, an assignment of the note, or an affidavit otherwise proving his status as a holder of the note.” Pennington v. Ocwen Loan Servicing, LLC, 151 So.3d 52, 53 (Fla. 1st DCA 2014); Focht v. Wells Fargo Bank, N.A., 124 So.3d 308, 310 (Fla. 2d DCA 2013); McLean v. JP Morgan Chase Bank 718*718 N.A., 79 So.3d 170, 173 (Fla. 4th DCA 2012). No document fitting the description above was attached to the original complaint when it was filed in 2008.

“[S]tanding must be established at the time of the filing of the foreclosure action.” May v. PHH Mortgage Corp., 150 So.3d 247, 248 (Fla. 2d DCA 2014); Pennington, 151 So.3d at 53; Focht, 124 So.3d at 310. A party’s standing “is determined at the time the lawsuit was filed” and “a party is not permitted to establish the right to maintain an action retroactively by acquiring standing after the case is filed.” McLean, 79 So.3d at 173. Although this rule has been criticized at times, we are bound to follow this long-standing rule established by the Florida Supreme Court. See Focht, 124 So.3d at 311-12 citing Marianna & B.R. Co. v. Maund, 62 Fla. 538, 56 So. 670 (Fla.1911);Voges v. Ward, 98 Fla. 304, 123 So. 785 (Fla.1929).

In the initial complaint, Aurora alleged that it did not possess the note on the date the complaint was filed. The amended complaint filed in June of 2011 included an attached corporate assignment dated April 9, 2008, but that attachment did not establish that an assignment had occurred as of February 7, 2008, the filing date of the initial complaint. Aurora’s lost note allegations in the original complaint, pursuant to section 673.3091, Florida Statutes, were never proved and were abandoned in the amended complaint. The blank indorsement filed with the certified copy of the note on June 7, 2011 might have been sufficient to prove that Aurora was entitled to enforce the instrument, under section 673.3011, as of June 7, 2011. But Appellant’s denial of Aurora’s status as owner or holder in the answer to the amended complaint and affirmative defenses made the issue of Aurora’s standing to enforce the note as of the filing of the original complaint a contested issue for Aurora to prove. The undatedblank indorsement did not answer the question of “whether the indorsement in blank antedated the filing of the original complaint.” Kiefert v. Nationstar Mortgage, LLC,153 So.3d 351, 353 (Fla. 1st DCA 2014).

The insufficiency of the documents in the record to establish Aurora’s standing as a party entitled to enforce the note on February 7, 2008, was not cured by the evidence presented at the bench trial. According to the statement of evidence and the proceedings, Nationstar relied on the testimony of its employee, Joan Osiemo. Ms. Osiemo began her employment with Nationstar as a “Litigation Research Analyst” in 2012. Although she did not testify that she was ever employed by Aurora or any other previous servicer of the mortgage or holder of the note, she testified that “Nationstar purchased the assets of Aurora via an asset Purchase Agreement.” She was familiar with Aurora’s “platform, policies/procedures, etc. as Nationstar employed numerous former Aurora employees who trained them and worked with the Nationstar employees on verifying data.” As described in the statement of evidence, Ms. Osiemo “stated that she did know from business records the Plaintiff had possession of the original documents prior to the Complaint and was therefore entitled to enforce the Note and Mortgage.”

Ms. Osiemo’s knowledge “from business records” that Aurora possessed “the original documents prior to the Complaint” does not establish that Aurora had standing to enforce the note on February 7, 2008, the date the initial complaint was filed. The statement describing the Nationstar employee’s testimony does not indicate any personal knowledge she might have of any processes of Aurora, MERS, or 123Loan. Her opinion, based on her review of unspecified “business records,” 719*719 that Aurora “had possession of the original documents prior to the Complaint” and was “therefore entitled to enforce” the instruments does not overcome the actual allegation in the original complaint that Aurora did not possess the note on February 7, 2008; the Corporate Assignment of Mortgage attached to the amended complaint which showed the note and mortgage were not assigned by MERS to Aurora until April 9, 2008, two months after the original complaint was filed; and Aurora’s failure to file the undated blank indorsement and corporate assignment of mortgage until 2011 as opposed to at the time of filing the initial complaint.

It is possible for a witness to provide sufficient testimony to prove standing where the documentary evidence is insufficient. Stone v. BankUnited, 115 So.3d 411 (Fla. 2d DCA 2013). In this case, however, the description of Ms. Osiemo’s testimony in the approved statement of the evidence does not amount to competent, substantial evidence to remedy the deficiencies and clear contradictions to her testimony contained in the undisputed documentary evidence. Our de novo review of the documentary evidence in the record and the statement of evidence and proceedings approved by the trial court compels us to conclude that the evidence was insufficient to establish that Nationstar’s predecessor plaintiff, Aurora, had standing to enforce the note via an action for foreclosure on February 7, 2008. Accordingly, the evidence in the record was insufficient to support the final judgment of foreclosure in favor of Nationstar due to the insufficient evidence to establish the predecessor plaintiff’s standing.^[1]

The final judgment of foreclosure in favor of Nationstar is REVERSED.

ROBERTS and SWANSON, JJ., concur.

[1] We are mindful of the perception that certain delinquent borrowers might enjoy a “windfall” where a foreclosure plaintiff is required to prove standing to enforce a note at the time the initial complaint is filed, but the filing of a new suit when standing has been acquired would take place more than five years after the alleged default. See § 95.11(2)(c), Fla. Stat. Proof of entitlement to enforce a note secured by a mortgage can be problematic in “this era of securitization of mortgage debt and computerized banking.” Focht v. Wells Fargo Bank, N.A., 124 So.3d 308, 312 (Fla. 2d DCA 2013) (Altenbernd, J., concurring). However, as Judge Altenbernd observed, “[i]n this case and numerous other cases, the financial institutions have brought these problems upon themselves by the complex methods of securitization and their own sloppy recordkeeping.” Id., at 313 (Altenbernd, J., concurring). We further note that many foreclosure actions languish due to the plaintiffs’ failure to prosecute cases in a timely manner and not from any wrongdoing by the borrower. Once a defendant contests the plaintiff’s standing as the proper party to enforce a note via foreclosure, the plaintiff’s right to bring suit on the note at the requisite time becomes a disputed issue the plaintiff must prove. Gee v. U.S. Bank, N.A., 72 So.3d 211, 213 (Fla. 5th DCA 2011). It is not inequitable to require a plaintiff to prove its case, beginning with its standing to bring the action at the outset when that status is challenged.

 

CAROL ANN JONES, etc., Petitioner,
v.
EDWARD I. GOLDEN, etc., Respondent.

No. SC13-2536.Supreme Court of Florida.

October 1, 2015.Robin Felicity Hazel of Hazel Law, P.A., Pembroke Pines, Florida, for Petitioner.

William H. Glasko of Golden Glasko & Associates, P.A., Miami, Florida, for Respondent.

Gerald Barnette Cope Jr., of Akerman LLP, Miami, Florida; Kenneth Bradley Bell and John Wesley Little III, of Gunster, West Palm Beach, Florida; and Robert W. Goldman of Goldman Felcoski & Stone, Naples, Florida, for Amicus Curiae The Real Property, Probate & Trust Law Section of The. Florida Bar.

CANADY, J.

In this case we consider the timeliness of a creditor’s claim against an estate under Chapter 733, Florida Statutes. In particular, we address whether the claim of a creditor who is not served with a copy of the notice to creditors but whose claim is known or reasonably ascertainable is barred under section 733.702(1), Florida Statutes (2006), if not filed within three months after the first publication of the notice to creditors absent an extension, or whether the claim is timely if filed within two years of the decedent’s death under section 733.710, Florida Statutes (2006). We have for review Golden v. Jones, 126 So. 3d 390, 390 (Fla. 4th DCA 2013), in which the Fourth District Court of Appeal held “that if a known or reasonably ascertainable creditor is never served with a copy of the notice to creditors, the statute of limitations set forth in section 733.702(1), Florida Statutes, never begins to run and the creditor’s claim is timely if it is filed within two years of the decedent’s death.” The Fourth District certified that its decision is in direct conflict with the decisions of the First and Second District Courts of Appeal in Morgenthau v. Andzel, 26 So. 3d 628 (Fla. 1st DCA 2009), and Lubee v. Adams, 77 So. 3d 882 (Fla. 2d DCA 2012), which held that even a reasonably ascertainable creditor who was not served with a copy of the notice to creditors is required to file a claim within three months after the first publication of the notice, unless the creditor files a motion for an extension of time under section 733.702(3) within the two-year period of repose set forth in section 733.710. We have jurisdiction. See art. V, § 3(b)(4), Fla. Const.

Because we conclude that the limitations periods prescribed in section 733.702(1) are not applicable to known or reasonably ascertainable creditors who are never served with a copy of the notice to creditors and that the claims of such creditors are timely if filed within two years of the decedent’s death under section 733.710, we approve the decision of the Fourth District in Golden and disapprove the decisions of the First and Second Districts in Morgenthau and Lubee.

I. BACKGROUND

Harry Jones died in February 2007 and his estate was opened in April 2007. In June 2007, a notice to creditors was published as required by section 733.2121, Florida Statutes (2006), but neither Harry’s ex-wife, Katherine Jones, nor her guardian^[1]were ever served with a copy of the notice. In January 2009, however, less than two years after Harry’s death, the guardian of Katherine Jones filed a statement of claim in the probate court. The statement of claim asserted that Harry’s estate owed Katherine money based on a marital settlement agreement executed in 2002. After Katherine died in 2010, Edward Golden was appointed as the curator of her estate.

In 2012, Golden filed in the probate court a “Petition for Order Declaring Statement of Claim Timely Filed and/or For Enlargement of Time to File Statement of Claim, Nunc Pro Tunc.” Essentially, Golden claimed that Katherine’s guardianship was a known or reasonably ascertainable creditor of Harry’s estate. Carol Jones, the personal representative of Harry’s estate and the Petitioner before this Court, filed a response to Golden’s petition asserting that Katherine was not a reasonably ascertainable creditor of Harry’s estate and that her guardian’s claim was time-barred under sections 733.702 and 733.710. After a hearing on the petition, theprobate court entered an order striking the guardian’s 2009 claim as untimely under sections 733.702, 733.710, on the authority of the decisions of the First and Second District Courts in Morgenthau and Lubee.

On appeal, Golden argued that because the notice to creditors was not properly served on Katherine, a known or reasonably ascertainable creditor, the three-month limitations period set forth in section 733.702(1) never began to run, and the claims of Katherine’s guardianship could only be barred by the two-year statute of repose in section 733.710. The Fourth District agreed with Golden, concluding that the probatecourt erred “in determining that the claim was untimely without first determining whether Katherine was a known or reasonably ascertainable creditor.” Golden, 126 So. 3d at 391, 393-94. The district court reversed and remanded the case to theprobate court to determine whether Katherine or her guardianship was a known or reasonably ascertainable creditor. Id. at 394. The district court further instructed that if the probate court determined that Katherine or her guardianship was indeed a known or reasonably ascertainable creditor, then the “claim was timely, as it was filed prior to the earlier of 30 days after service of notice to creditors (which never occurred) or two years after the decedent’s death.” Id. at 393-94. The Fourth District recognized that the decisions of the First District in Lubee and the Second District in Morgenthau both reached contrary conclusions and certified conflict with those cases. Id.

II. ANALYSIS

The question before the Court is one of statutory interpretation, which is subject to de novo review. BellSouth Telecommunications, Inc. v. Meeks, 863 So. 2d 287, 289 (Fla. 2003). In the analysis that follows, we examine the relevant statutes and discuss the conflicting district court decisions. We then resolve the conflict by approving the reasoning of the Fourth District in Golden and concluding that claims of known or reasonably ascertainable creditors of an estate who were not served with a copy of the notice to creditors are timely if filed within two years of the decedent’s death.

A. Relevant Statutes

Three sections of the Florida Probate Code are relevant to our resolution of the conflict presented. Section 733.2121 outlines the duty of a personal representative to publish a notice to creditors of the pending administration of an estate and to serve a copy of the notice to creditors on known or reasonably ascertainable creditors. It provides, in relevant part:

(1) Unless creditors’ claims are otherwise barred by s. 733.710, the personal representative shall promptly publish a notice to creditors. The notice shall contain the name of the decedent, the file number of the estate, the designation and address of the court in which the proceedings are pending, the name and address of the personal representative, the name and address of the personal representative’s attorney, and the date of first publication. The notice shall state that creditors must file claims against the estate with the court during the time periods set forth in s. 733.702, or be forever barred.

(2) Publication shall be once a week for 2 consecutive weeks, in a newspaper published in the county where the estate is administered or, if there is no newspaper published in the county, in a newspaper of general circulation in that county.

(3)(a) The personal representative shall promptly make a diligent search to determine the names and addresses of creditors of the decedent who are reasonably ascertainable, even if the claims are unmatured, contingent, or unliquidated, and shall promptly serve a copy of the notice on those creditors. Impracticable and extended searches are not required. Service is not required on any creditor who has filed a claim as provided in this part, whose claim has been paid in full, or whose claim is listed in a personal representative’s timely filed proof of claim.

. . . .

(4) Claims are barred as provided in ss. 733.702 and 733.710. § 733.2121, Fla. Stat. (2006); see also Fla. Prob. R. 5.241(a) (“[T]he personal representative shall promptly publish a notice to creditors and serve a copy of the notice on all creditors of the decedent who are reasonably ascertainable.”).

Section 773.702 provides, in relevant part:

(1) [N]o claim or demand against the decedent’s estate . . . is binding on the estate . . . unless filed in the probate proceeding on or before the later of the date that is 3 months after the time of the first publication of the notice to creditors or, as to any creditor required to be served with a copy of the notice to creditors, 30 days after the date of service on the creditor.. . .

. . . .

(3) Any claim not timely filed as provided in this section is barred even though no objection to the claim is filed unless the court extends the time in which the claim may be filed. An extension may be granted only upon grounds of fraud, estoppel, or insufficient notice of the claims period.

. . . .

(6) Nothing in this section shall extend the limitations period set forth in s. 733.710.

§ 733.702, Fla. Stat. (2006) (emphasis added).

Section 733.710 provides, in relevant part:

(1) Notwithstanding any other provision of the code, 2 years after the death of a person, neither the decedent’s estate, the personal representative, if any, nor the beneficiaries shall be liable for any claim or cause of action against the decedent, whether or not letters of administration have been issued, except as provided in this section.

(2) This section shall not apply to a creditor who has filed a claim pursuant to s. 733.702 within 2 years after the person’s death, and whose claim has not been paid or otherwise disposed of pursuant to s. 733.705.

§ 733.710, Fla. Stat. (2006).

We have held that section 733.702 is a statute of limitations and that section 733.710 is a jurisdictional statute of nonclaim, which cannot be waived or extended. May v. Illinois Nat. Ins. Co., 771 So. 2d 1143, 1150 (Fla. 2000).

B. Morgenthau and Lubee

In Morgenthau, the personal representative of the decedent’s estate published a notice to creditors in a newspaper in March 2008, informing possible creditors of the estate that they had three months from the date of the first publication in which to file any claims outstanding against the estate. 26 So. 3d at 629. In April 2009, Morgenthau filed a statement of claim alleging that he was the holder of an outstanding note executed by the decedent and that the personal representative was aware of the amount due to Morgenthau. Id. The probate court struck the claim as untimely because it was not filed within three months of the first publication of the notice to creditors. Id. at 629-30.

On appeal, the First District found that even if Morgenthau was a known or reasonably ascertainable creditor of the estate who was therefore entitled to receive actual notice by service, because he was not served with a copy of the notice, he was required to file his claim within the three-month window following the first publication of the notice. Id. at 632 (“[T]he claim was untimely as appellant did not receive actual notice of the claim and was, thus, a creditor who fell in the three month filing window following publication.”). The district court stated that once Morgenthau’s claim fell outside the three-month window, it could only be considered if Morgenthau had requested and been granted an extension of time by the probate court. Id. Because Morgenthau filed only a statement of claim and did not seek an extension of time in which to file that claim, the district court concluded that “the probate court was bound by the relevant statutes to deny the claim.” Id.

In Lubee, the decedent died in December 2006, and the notice to creditors was first published in November 2007. 77 So. 3d at 883. More than one year after the first publication, Lubee filed a statement of claim in the probate court. Id. Lubee asserted that because he was a readily ascertainable creditor entitled to be served with a copy of the notice to creditors, he was only required to file his claim within thirty days after service of the notice under section 733.702(1) or within two years of the decedent’s death under section 733.10. According to Lubee, because he was never served with a copy of the notice to creditors, his claim was timely filed within two years of the decedent’s death. Id.

The Second District disagreed and concluded that Lubee’s claim was untimely because it was filed outside of the three-month window. The Second District concluded that whether Lubee was a reasonably ascertainable creditor or not was immaterial. The court explained:

Because a notice to creditors was published on November 16, 2007, creditors not entitled to actual notice were required to file their claims on or before February 16, 2008. See § 733.702(1). Creditors who were served with the notice to creditors were required to file their claims within thirty days following service. See id. Because he was not served with a copy of the notice to creditors, Mr. Lubee was required to file his claim in the probate proceeding within the three-month window following publication. Alternatively, Mr. Lubee could seek an extension from theprobate court pursuant to section 733.702(3) within the two-year window of section 733.710. See Morgenthau v. Estate of Andzel, 26 So. 3d 628, 632 (Fla. 1st DCA 2009); cf. Miller v. Estate of Baer, 837 So. 2d 448, 449 (Fla. 4th DCA 2002) (affirming order enforcing claim against estate where creditor failed to file claim within three-month window of section 733.702(1) but did file motion for extension of time within two-year window of section 733.710). It is undisputed that he did neither. Mr. Lubee’s filing of his claim in the probate proceeding within two years of the decedent’s death did not amount to a request for an extension of time and did not otherwise comply with the requirements of section 733.702. Mr. Lubee’s claim in the probate proceeding was untimely and therefore barred. As a result, the issue of whether or not Mr. Lubee was a readily ascertainable creditor was immaterial[.]

Id. at 883-84 (emphasis added).

In Golden, the Fourth District rejected the analyses in Morgenthau and Lubee, finding the decisions inconsistent with the plain language of section 733.702(1), which allows a known or reasonably ascertainable creditor to file a claim against an estate “on or before the later of the date that is 3 months after the time of the first publication of the notice to creditors or . . . 30 days after the date of service on the creditor.” The court instead followed Fourth District precedent established in In re Estate of Puzzo, 637 So. 2d 26 (Fla. 4th DCA 1994), in which the court stated:

Due process considerations require that Appellants be furnished notice so that they can determine that the time for filing claims has commenced. However, regardless of whether or not the claimants had actual notice, section 733.702(1), Florida Statutes, does not bar the claim of a creditor required to be served with a copy of the notice of administration, unless barred by section 733.710, until the later of the 3-month period following publication or 30 days after service of notice on the creditor. The latter period had not begun to run at the time Appellants’ claims were filed.

We remand for the trial court to determine as to which of Appellant[s’] claims they were known or ascertainable creditors. Any such claims, though filed after the 3-month period, should not have been stricken as untimely if filed prior to the earlier of 30 days after service of notice of administration or 2 years after the decedent’s death.

Golden, 126 So. 3d at 392 (alteration in original) (quoting Puzzo, 637 So. 2d at 27).

The Fourth District concluded that the probate court should have determined whether Katherine or her guardianship was a known or reasonably ascertainable creditor prior to determining the timeliness of her guardian’s claim, and if she or the guardianship was a known or reasonably ascertainable creditor, then the claim “though filed after the 3-month period, should not have been stricken as untimely if filed prior to the earlier of 30 days after service of notice of administration or 2 years after the decedent’s death.” Id. (quoting Puzzo, 637 So. 2d at 27).

C. Resolving the Conflict

Section 733.702(1), Florida Statutes, provides two distinct and different limitations periods for the filing of claims against an estate: one for creditors “required to be served with a copy of the notice to creditors,” i.e., known or reasonably ascertainable creditors, and a second for unknown and not reasonably ascertainable creditors (hereinafter “unknown creditors”). The limitations period applicable to unknown creditors, set forth in section 733.702(1), begins to run upon publication of the notice to creditors and ends three months after the date of the first publication.

Creditors who are known or reasonably ascertainable need not rely on publication for notice of the pending administration of an estate. Section 733.2121(3)(a) requires a personal representative to “promptly serve a copy of the notice” on those creditors who are known or reasonably ascertainable after a diligent search. The limitations period applicable to known or reasonably ascertainable creditors does not begin to run until service is perfected. Once served with a copy of the notice, a known or reasonably ascertainable creditor must file any claim within the later of “3 months after the time of the first publication of the notice to creditors or . . . 30 days after the date of service on the creditor . . . .” § 733.702(1), Fla. Stat.

Under the plain language of section 733.702(1), where a known or reasonably ascertainable creditor is never served with a copy of the notice to creditors, the applicable limitations period never begins to run and cannot bar that creditor’s claim. “[A]s to any creditor required to be served with a copy of the notice to creditors,” the limitations period can only be triggered by “service on the creditor” of the required notice. § 733.702(1), Fla. Stat. A known or reasonably ascertainable creditor is absolved from the limitations of section 733.702(1) by virtue of the fact that the personal representative failed to serve the creditor with the required notice. The only instance in which a known or reasonably ascertainable creditor is required to file any claims before the expiration of the three-month window after publication of the notice is where the last day of the three-month window occurs more than thirty days after service of the required notice.

Accordingly, if a known or reasonably ascertainable creditor is not served with a copy of the notice, section 733.702(1) does not govern the timeliness of that creditor’s claims. Instead, the claims of such a creditor are only barred if not filed within the two-year period of repose set forth in section 733.710. Thus, the claim of a known or reasonably ascertainable creditor who was never served with a copy of the notice to creditors is timely if filed within two years of the decedent’s death. Further, because the limitations periods in section 733.702 are inapplicable under such circumstances, it is not necessary for the creditor to seek an extension of time under section 733.702(3) since that section applies only to claims that are untimely under section 733.702.

The decision of the First District in Morgenthau—on which the Second District relied in Lubee—is based on a misinterpretation of the limitations provisions in section 773.702(1).^[2] The First District interpreted that section in the following manner:

Section 773.702(1) mandates a claim is untimely if it is filed either (1) outside the three month window following publication to creditors or (2) filed outside the 30 day window for responding to a notice of claim if the creditor is a readily ascertainable creditor of the estate entitled to actual notice of the claim.

Morgenthau, 26 So. 3d at 630 (emphasis added). Stated differently, Morgenthau requires that to be timely, a claim must be filed both within the three-month window after publication and within the thirty-day window after service of a copy of the notice. But that’s not what the statute says. As explained above, the plain language of section 733.702 specifies that as to a known or reasonably ascertainable creditor, a claim is timely if “filed in the probate proceeding on or before the later of the date that is 3 months after the time of the first publication of the notice to creditors or, as to any creditor required to be served with a copy of the notice to creditors, 30 days after the date of service on the creditor.” § 733.702(1), Fla. Stat. (emphasis added).

The interpretation adopted in Golden is in accord with the plain terms of the statute. And it is also in accord with the requirements of due process. In Tulsa Professional Collection Services, Inc. v. Pope, 485 U.S. 478, 489-91 (1988), the United States Supreme Court held that where a creditor is known or reasonably ascertainable, that creditor’s claim may not be barred merely by publication of the notice to creditors. Noting that a claim against an estate is property subject to protection by the Fourteenth Amendment, the Supreme Court weighed the important state interests in regulating the timeliness of creditors’ claims against the rights of those creditors to have their intangible interests in property protected by the Fourteenth Amendment. Id. at 485. The Supreme Court determined that where a time bar is self-executing—such as the two-year statute of repose in section 733.710—there is insufficient state action to implicate the Due Process Clause of the Fourteenth Amendment. Id. at 485-87. However, where a time bar is triggered by legal proceedings—such as the limitations periods in section 733.702—there is sufficient state action to implicate the Due Process Clause. Id. at 487-88. The Court thus concluded that where there is sufficient state action and a creditor is “known or `reasonably ascertainable,’ then the Due Process Clause requires that [the creditor] be given `[n]otice by mail or other means as certain to ensure actual notice.'” Id. at 491 (quoting Mennonite Bd. of Missions v. Adams, 462 U.S. 791, 800 (1983)).

A personal representative is therefore constitutionally obligated to provide actual notice to known or reasonably ascertainable creditors and if the personal representative fails to provide that notice, the creditors’ claims cannot be barred except under section 733.710. The Fourth District’s decision in Golden properly recognizes the duty of the personal representative to provide notice to known and reasonably ascertainable creditors and the requirement of actual notice to satisfy due process as to those creditors

III. CONCLUSION

For the reasons explained above, we conclude that claims of known or reasonably ascertainable creditors of an estate who were not served with a copy of the notice to creditors are timely if filed within two years of the decedent’s death. Accordingly, we approve the decision of the Fourth District in Golden and disapprove the decisions of the First District in Lubee and the Second District in Morgenthau.

It is so ordered.

LABARGA, C.J., and PARIENTE, LEWIS, QUINCE, POLSTON, and PERRY,

JJ., concur.

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION, AND IF FILED, DETERMINED.

[1] In 2008, a guardian was court appointed for Katherine Jones because she was adjudicated to lack capacity.

[2] The Morgenthau court’s analysis may also have been hampered by the fact that Morgenthau conceded that his claim was “untimely.” Morgenthau, 26 So. 3d at 630.

 

LEGAL AID SOCIETY OF PALM BEACH COUNTY, INC., PUBLIC GUARDIANSHIP PROGRAM, Appellant,
v.
THE GUARDIANSHIP OF JENNIFER JAFFE and FERD AND GLADYS ALPERT JEWISH FAMILY & CHILDREN’S SERVICE, Appellees.

No. 4D15-357.District Court of Appeal of Florida, Fourth District.

November 4, 2015.Robert J. Hauser of Pankauski Law Firm PLLC and Rena J. Taylor of Legal Aid Society of Palm Beach County, Inc., West Palm Beach, for appellant.

Antony P. Ryan, Regional Counsel, and Melanie Casper, Assistant Regional Counsel, Office of Criminal Conflict and Civil Regional Counsel, West Palm Beach, for appellee Jennifer Jaffe.

Mitchell I. Kitroser of Mitchell I. Kitroser, P.A., North Palm Beach, for appellee Ferd and Gladys Alpert Jewish Family & Children’s Service.

WARNER, J.

The Legal Aid Society of Palm Beach County, Inc., Public Guardianship Program, appeals an order appointing it to serve as successor guardian to a previously-declared incapacitated ward. The court appointed Legal Aid, despite its objection that to act as guardian for this ward would require it to exceed the statutorily set ratio of guardians to wards. To overcome this objection, the court ordered Legal Aid to transfer one of its present wards to the ward’s withdrawing guardian, Ferd and Gladys Alpert Jewish Family & Children’s Service of Palm Beach County, Inc. (“AJFCS”). Because the court had no authority to involuntarily appoint Legal Aid, nor to order the transfer of other wards to another guardian, we reverse.

In 2006, the subject ward was determined to be incapacitated. Since that time, the ward has had at least six court-appointed guardians, the most recent being AJFCS. AJFCS petitioned to resign, claiming that the situation with the ward had become “untenable.” As guardian, AJCFS could not control the actions of the ward or the ward’s family and their effect on the ward’s person and property. The ward’s mother distributed money directly to the ward, and arranged medical appointments and treatment without consulting AJFCS. The ward was in an “unhealthy relationship” with a man. She also drove her vehicle, even though her right to drive had been taken away in the incapacity proceedings. Because AJFCS could not control either her person or property, it sought to withdraw.

In its petition, AJFCS suggested that the Statewide Public Guardian appoint a local public guardian in its place, as the ward did not have sufficient funds at the present time for a private guardian. It did not provide notice, however, to either the Statewide Public Guardian or Legal Aid, the local public guardian, as is required by Florida Probate Rule 5.560(c).

Without notice to Legal Aid, the court approved the resignation of AJFCS and appointed Legal Aid as successor plenary guardian. A copy of the order was served on Legal Aid, which immediately filed a motion for rehearing based upon its lack of notice. It asserted that it did not accept the appointment as successor guardian because, if it took another ward, it would exceed the statutory ratio limiting the number of wards it could serve. The court granted the motion for rehearing.

At the new hearing, the probate court made it clear that it had approved AJFCS’s resignation and would not re-appoint it as guardian. Despite its best efforts, AJFCS was not able to protect the ward from herself and admitted that it was “stumped” by this case.

Legal Aid contended that the court lacked authority to order the public guardian to take the case. No statutory authority existed for the court to compel its appointment. Moreover, section 744.708(7), Florida Statutes (2015), provides for a staff-to-wards ratio of one to forty. Legal Aid was at that ratio and could not take on any more wards.

Ultimately, to remedy Legal Aid’s over-capacity concern, the court ordered AJFCS to take over as guardian of a ward of Legal Aid, although the court did not designate any specific ward. The court then denied Legal Aid’s motion for rehearing, confirming Legal Aid’s appointment as guardian of the ward. Legal Aid now appeals the order of appointment.

Simply stated, the question presented in this case is whether the trial court had any authority to appoint Legal Aid as guardian of this ward, over its objection and despite the fact that this would cause it to exceed its statutory capacity. The answer is that there is no authority for the court to make this involuntary appointment. No statute or rule provides any such authority, and the history of Florida Probate Rule 5.560 provides evidence that the court does not have any discretionary authority to appoint the public guardian.

Florida’s Public Guardianship law was created by the Legislature in 1986. See § 744.701, Fla. Stat. (2015). Its purpose was to permit the establishment of offices of public guardianship throughout Florida to provide guardianship services to incapacitated persons who could not afford a private guardian and had no family members to assume the task of guardianship. § 744.702, Fla. Stat. (2015). The Legislature created a Statewide Public Guardianship Office to coordinate these offices, including the development of standards for public guardians. § 744.7021, Fla. Stat. (2015). Funding for public guardians comes through state funding as well as local efforts. See § 744.706, Fla. Stat. (2015). “The public guardian. . . primarily serve[s] incapacitated persons who are of limited financial means, as defined by contract or rule of the Department of Elderly Affairs.” § 744.704(3), Fla. Stat. (2015).

Undoubtedly recognizing that the need for public guardianship may be greater than the resources available, the Legislature limited the number of wards a public guardian may serve based upon a staff-to-ward ratio. “The ratio for professional staff to wards shall be 1 professional to 40 wards.” § 744.708(7), Fla. Stat. (2015). In 1996, this provision was amended so that “[t]he Statewide Public Guardianship Office may increase or decrease the ratio after consultation with the local public guardian and the chief judge of the circuit court.” Id. It is thus not within the authority of a single judge within a circuit to compel the public guardian to exceed the statutorily imposed ratio.

Additionally, nowhere in the statute does the Legislature direct the public guardians, many of whom are appointed through a contract with the Statewide Public Guardianship Office, to serve as guardian for all indigent incapacitated wards. In contrast, for example, public defenders are explicitly required by statute to represent any indigent individual charged with a felony, as well as other mandatory proceedings. See, e.g., § 27.51, Fla. Stat. (2015). In other words, if the Legislature had deemed it appropriate to mandate that the public guardian be appointed for all indigent incapacitated persons, it could have provided for the same by statute. It did not.

The history of Florida Probate Rule 5.560, which provides procedural rules for petitions for the appointment of a guardian to an incapacitated person, also confirms that the court has no authority to make an involuntary appointment of a public guardian. Prior to 1989, Florida Probate Rule 5.560(b) provided that “[t]he court on its own motion may appoint the public guardian without notice to the public guardian.” (Emphasis omitted). This sentence had been added by the Florida Supreme Court itself in a rule revision in 1987. See In re Rules of Probate & Guardianship Procedure (Pub. Guardianship), 517 So. 2d 675, 676 (Fla. 1987). However, this language disappeared from the rule in 1989, when the court adopted interim rules after the Legislature substantially rewrote the guardianship law. In re Amendment to Florida Probate Rules Part III (Guardianship), 551 So. 2d 452 (Fla. 1989). The authority to appoint the public guardian sua sponte has never reappeared in the rules. Instead, the present rules provide notice to the guardian if a petitioner requests the appointment of a public guardian. See Fla. Prob. R. 5.560(c).

To remedy the ratio problem, the court in this case compelled a “swap” of wards by requiring Legal Aid to transfer the guardianship of one if its present wards for the ward in this case. This, too, is contrary to statutory authority. First, “swapping” wards suggests that these incapacitated individuals are fungible. They clearly are not. Every ward has a guardianship plan, see § 744.363, Fla. Stat. (2015), and public guardians are required by statute to personally visit the ward at least once each calendar quarter, see § 744.708(6), Fla. Stat. (2015). Thus, there is every expectation that the public guardian will develop some rapport with the ward. A guardian is not allowed to resign without assurances that the ward’s interest will not be placed in jeopardy. See § 744.467, Fla. Stat. (2015). The court’s order compelling Legal Aid to “swap” out a ward runs contrary to and ignores the principles underlying these statutes.

Furthermore, Legal Aid is not only at its capacity for wards, it has a waiting list. That list is comprised of persons who meet eligibility requirements, as defined by the Department of Elderly Affairs. See § 744.704(3), Fla. Stat. (2015). Ordering Legal Aid to accept this ward, whose eligibility has not even been determined, prevents the public guardian from serving those incapacitated persons who are already eligible and awaiting appointment. There is no provision in the statute for the court to determine eligibility. That is left to the executive branch through the Department of Elderly Affairs. By ordering Legal Aid to act as guardian of this ward, the court is disregarding an executive branch function.

Obviously, the court felt that this particular ward presented a real dilemma. The court found that AJFCS could no longer serve as her guardian when she refused to comply with their directives. As there was no evidentiary hearing on the issue, we cannot comment on this evaluation. However, section 744.471, Florida Statutes (2015), precludes the court from relieving a guardian from his or her duties until a successor is appointed. Therefore, the court should not have allowed the resignation of AJFCS until it had properly appointed another guardian.

We recognize that there are few options available to the court. And, as Legal Aid points out, there is no guarantee that it would have any better success with this ward than AJFCS, even it if could accept the appointment as the ward’s guardian. If the ward is truly a danger to herself, involuntary hospitalization or placement may be needed, for which court approval must be obtained.^[1] See § 744.3215(4), Fla. Stat. (2015). The court may also request the involvement of the chief judge and the Statewide Public Guardianship Office to review the capacity of the public guardian in Palm Beach County.

For the foregoing reasons, we hold that the court has no authority to make an involuntary appointment of Legal Aid as the public guardian of an incapacitated ward. We reverse and remand for further proceedings.

CONNER, J., and LEVEY COHEN, MARDI, Associate Judge, concur.

Not final until disposition of timely filed motion for rehearing.

[1] We also note in the record on appeal that the ward has petitioned to have her capacity restored.

 

 

GARY T. FAULKNER, an interested person, and as Personal Representative of the Estate of Katherine L. Faulkner, Appellant,
v.
KIRSTEN WOODRUFF; WOODRUFF LAW; HEATHER LANG; RICHARD SALEM; and SALEM LAW GROUP, P.A., Appellees.

Case No. 2D13-2165.District Court of Appeal of Florida, Second District.Opinion filed March 6, 2015.Joseph R. Miele of Hinshaw & Culbertson LLP, Coral Gables; and Cynthia M. Petitjean of Cynthia M. Petitjean, Plant City, for Appellant.

Jessica C. Tien of Tien Law Group, Tampa; and Heather Lang of Salem Law Group, P.A., Tampa, pro se, and for Appellees.

CASANUEVA, Judge.

Gary T. Faulkner appeals an order dismissing his petition to review the compensation paid to attorneys who were hired to assist in the administration of the Estate of Katherine L. Faulkner (“the Estate”). We conclude that the trial court erred in dismissing Mr. Faulkner’s petition and reverse.

I. FACTS AND PROCEDURAL HISTORY

As personal representative of the Estate, Mr. Faulkner hired the Woodruff Law Firm on December 21, 2008, and the Salem Law Group on January 13, 2009, to assist in the administration of the Estate.^[1] Although the Estate consisted of $4594.02 in personal property and a house that sold for $150,000, the attorneys charged $39,869.24 for work performed in the uncontested formal administrative proceeding.

Mr. Faulkner filed his original petition for review of compensation of the Estate employees as an interested person on May 28, 2010. The petition asked the probate court to review the reasonableness of the attorney’s fees paid to Kirsten Woodruff, Heather Lang, and Richard Salem. The petition was dismissed without prejudice based on the court’s finding that Mr. Faulkner was required to interplead himself, as personal representative, into the action. Thereafter, Mr. Faulkner filed his amended petition for review of compensation of the Estate employees as both “an interested person” and as personal representative of the Estate.^[2] He cited section 733.6175, Florida Statutes (2010), and Florida Probate Rule 5.355 as authority for the probate court to review the reasonableness of the fees.

In moving to dismiss the amended petition, Appellees argued, and the probate court agreed, that section 733.6175 required Mr. Faulkner to interplead himself, as the personal representative, as a respondent to his petition. Section 733.6175 provides as follows:

(1) The court may review the propriety of the employment of any person employed by the personal representative and the reasonableness of any compensation paid to that person or to the personal representative.

(2) Court proceedings to determine reasonable compensation of the personal representative or any person employed by the personal representative, if required, are a part of the estate administration process, and the costs, including attorneys’ fees, of the person assuming the burden of proof of propriety of the employment and reasonableness of the compensation shall be determined by the court and paid from the assets of the estate unless the court finds the requested compensation to be substantially unreasonable. The court shall direct from which part of the estate the compensation shall be paid.

(3) The burden of proof of propriety of the employment and the reasonableness of the compensation shall be upon the personal representative and the person employed. Any person who is determined to have received excessive compensation from an estate for services rendered may be ordered to make appropriate refunds.

(Emphasis added.)

Appellees claim that subsection three places the burden of proof as to the reasonableness of attorney’s fees on both Mr. Faulkner, as personal representative, and the attorneys. Therefore, they argue that Mr. Faulkner was required to interplead himself as a respondent in the action, which would make him both the petitioner and the respondent. We disagree that the statute requires this result.^[3]

II. ANALYSIS OF SECTION 733.6175

Section 733.6175 provides a circuit court with the authority to determine the reasonableness of compensation paid to a personal representative or any person employed by the personal representative. Accordingly, the personal representative has the burden to establish that its fees were reasonable, and likewise, a person hired by the personal representative has the burden of proving that their fees were reasonable. The Fourth District has held that, because a personal representative may be responsible for the payment of excessive fees, “the personal representative has the same right to have the court review the employment relationship and the reasonableness of the compensation as a party who may bear the impact of such payment.” In re Estate of Winston, 610 So. 2d 1323, 1325 (Fla. 4th DCA 1992).

To the extent that any ambiguity may exist regarding who bears the burden of proof when there is a challenge to the reasonableness of the attorney’s fees charged to an estate, an examination of the statute’s legislative history is helpful. See W. Fla. Reg’l Med. Ctr., Inc. v. See, 79 So. 3d 1, 9 (Fla. 2012). Section 733.6175 was amended effective January 1, 2001. Ch. 01-226, § 143, Laws of Fla. The House of Representatives Staff Analysis, H.B. 0137, section 135, March 7, 2001, explains the “Present Situation” as follows:

The probate court may determine the propriety of any cost, fee, or commission payable to a personal representative or professional employed by the estate. If contested, the party seeking the cost, fee or commission has the burden of showing the propriety of the employment and the reasonableness of the cost, fee or commission.

Fla. H.R. Comm. on Jud. Oversight. HB 137 (2001), Staff Analysis (Mar. 7, 2001), available at (https://archive.flsenate.gov/data/session/2001/House/bills/analysis/pdf/2001h0137a.ba. pdf) (emphasis added). Therefore, it appears that the legislature intended that the party seeking fees would bear the burden of establishing the reasonableness of such fees. Otherwise, a personal representative could never petition a court to review the reasonableness of attorney’s fees in probate proceedings.

The probate court also questioned whether it was the correct venue to determine the reasonableness of the attorney’s fees, suggesting that a suit for unjust enrichment or a proceeding before The Florida Bar may be the appropriate mechanism to review the fees. The court was incorrect. As the First District noted in Bookman v. Davidson, 136 So. 3d 1276, 1280 (Fla. 1st DCA 2014),

Section 733.6175(2), Florida Statutes, provides that “[c]ourt proceedings to determine the reasonable compensation of the personal representative or any person employed by the personal representative, if required, are a part of the estate administrative proceedings. . . .” (Emphasis added.) Accordingly, it has been held that “the Florida probate court has exclusive jurisdiction [over the matter of compensation] and is obligated to review estate fees upon the petition of a proper party.” In re Winston, 610 So. 2d 1323, 1325 (Fla. 4th DCA 1992).

See also Glantz & Glantz, P.A. v. Chinchilla, 17 So. 3d 711, 712 (Fla. 4th DCA 2009)(where trial court held evidentiary hearing on reasonableness of attorney’s fees after personal representative, who had retained attorney, wrote a letter to the court voicing her concern about the law firm’s billing).

Appellees also argue on appeal that the probate court could not determine whether their fees were reasonable, because the fees were paid from the proceeds of the sale of homestead property, and homestead property is excluded from the value of an estate in probate court.^[4] See § 732.402, Fla. Stat. (2010). Therefore, they contend, the probate court did not have jurisdiction to review the reasonableness of the fees and this dispute must be heard in the civil division of the circuit court. Appellees’ argument is meritless.

In Richardson v. Jones, 508 So. 2d 739, 740 (Fla. 2d DCA 1987), the attorney argued that the probate court did not have the authority to order him to reimburse the estate for excessive fees, because the attorney had been paid personally by the personal representative of the estate and not from the estate assets. This court held, “We find this argument to be without merit. The court’s order simply carries out its obligation to review and determine the reasonableness of compensation to be paid to an attorney for a personal representative.” Id. The fact that an attorney may be paid from sources separate from the estate does not divest the probate court of its authority to determine whether the fees charged are reasonable. See Morrison v. Estate of DeMarco, 833 So. 2d 180, 182 (Fla. 4th DCA 2002) (holding that probate court had jurisdiction to order attorney to account for money she received from the sale of condominium that was homestead property, a nonprobate asset).

Although Appellees complained during the hearing on their motion to dismiss the amended petition that this case had been lingering for far too long, we note that Appellees could have agreed to a hearing to demonstrate that their fees were reasonable almost five years ago. During that five-year period, Appellees have continuously objected to the probate court’s examination of the reasonableness of the $39,869.24 in fees they charged the Estate.^[5] Nearly 890 pages have been added to the record in this probate case since Mr. Faulkner filed his original petition to review the compensation. In comparison, the portion of the record involving the administration of the Estate appears to consist of only 127 pages of record. A substantial amount of time and effort has been expended in an attempt to evade review of the reasonableness of Appellees’ fees.

III. CONCLUSION

We hold that a personal representative may petition the probate court to review the reasonableness of attorney’s fees pursuant to section 733.6175. As the party seeking fees, Appellees have the burden of proof to establish that their fees are reasonable. Accordingly, we reverse the order dismissing the amended petition for review of compensation of estate employees and remand for further proceedings.

VILLANTI, C.J., and ALTENBERND, J., Concur.

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED.

[1] Mr. Faulkner hired the Woodruff Law Firm, and the Salem Law Group was brought into the case by an “informal co-counsel arrangement” between the two firms. The engagement letter with the Woodruff Law Firm states, “Woodruff Law occasionally works on cases such as yours with Salem Law Group, therefore Heather Lang and Kimberly Sparkes, among other people, may work on your case. Under an informal co-counsel arrangement between Woodruff Law and Salem Law Group, Woodruff Law is entitled to 15% of the fees paid to Salem Law Group. Salem Law absorbs this charge, it is not an extra cost to you. Salem Law will draft their own engagement letter and bill separately for their time.”

[2] Mr. Faulker is one of several beneficiaries of the Estate.

[3] Our review of the interpretation of section 733.6175 is performed de novo. Zingale v. Powell, 885 So. 2d 277, 280 (Fla. 2004).

[4] A notice of lien on the property was filed to secure the payment of attorney’s fees and costs to Appellees. When the property was sold, Appellees received the balance due for their attorney’s fees.

[5] Section 733.6171(3)(a) states that attorney’s fees in formal estate administration proceedings are presumed to be reasonable if based on the compensable value of the estate, and where the estate has a value of $40,000 or less, a reasonable fee would be $1500.

 

 

Margaret M. Finnegan, as Executor of the Estate of Ellen DONLON, Appellant,
v.
NOREEN COMPTON, as Personal Representative of the Estate of FREDRICK LaCHANCE, Appellee.

No. 4D13-4213.District Court of Appeal of Florida, Fourth District.January 14, 2015.Amy J. Fanzlaw of Osborne & Osborne, P.A., Boca Raton, for appellant.

No brief filed for appellee.

ON MOTION FOR REHEARING AND REHEARING EN BANC

PER CURIAM.

Appellant moves for rehearing and rehearing en banc. The basis for the motions is that we “overlooked Florida Probate Rule 5.025, which specifically states that Florida Rule of Civil Procedure 1.525 is inapplicable in adversary probate proceedings.” Appellant argues that she “cannot be required to comply with a rule that specifically, as a matter of law, does not apply.” Further, appellant contends that our application of Rule 1.525 in her case conflicts with Stone v. Stone, 132 So. 3d 377 (Fla. 4th DCA 2014), where we applied Probate Rule 5.025(d)(2), and not Rule 1.525, to determine the timeliness of a motion for costs.

Probate Rule 5.025(d)(2) was modified in 2011 “to insure that an award of attorneys’ fees in a probate or guardianship proceeding follows the law and procedures established for such proceedings, rather than the law and procedures for civil proceedings.” Fla. R. Prob. 5.025 committee notes. The Supreme Court clarified that Rule 5.025(d)(2) applies to “all proceedings commenced on or after the September 28, 2011, effective date” and also to “all proceedings that were pending on the effective date, but only as to all judgments, orders, or notices that were filed on or after that date.” In re Amendments to the Florida Probate Rules, 95 So. 3d 114, 115 (Fla. 2012).

In this case, appellant obtained a final judgment on January 5, 2011, over eight months before the September 28, 2011 effective date of the amendment to Probate Rule 5.025(d)(2). At the time the judgment was entered, Civil Rule 1.525 applied.See, e.g., Hays v. Lawrence, 1 So. 3d 1176, 1177 (Fla. 5th DCA 2009). Appellant did not move for attorney’s fees until September 7, 2012, long after the Rule 1.525 time limits had passed. It is the date of the final judgment that distinguishes this case fromStone v. Stone, where the final judgment forming the basis of the motion for costs was impliedly entered after the amendment’s effective date.

The motions for rehearing and rehearing en banc are denied.

DAMOORGIAN, C.J., STEVENSON and GROSS, JJ., concur.

140 So.3d 1085 (2014)

Tracey REDD, Petitioner,
v.
JUSTICE ADMINISTRATIVE, COMMISSION, Respondent.

No. 2D14-687.District Court of Appeal of Florida, Second District.June 11, 2014.1086*1086 Terry P. Roberts, Law Office of Terry P. Roberts, Tallahassee, for Petitioner.

Ana Cristina Martinez, General Counsel, Tallahassee, for Respondent.

ORDER DISCHARGING ORDER TO SHOW CAUSE

PER CURIAM.

After Tracey Redd filed this petition for writ of certiorari seeking to quash the circuit court’s order awarding her attorney’s fees in an amount less than requested for her services as court-appointed co-counsel for a defendant in a capital murder case, see§ 27.5304, Fla. Stat. (2013), this court issued an order to show cause why her petition should not be dismissed as untimely filed. We now discharge our order to show cause for the following reasons.

1087*1087 In Lee County case number 08-CF-14594, the circuit court entered an order appointing Ms. Redd as co-counsel for Robert Harold Dunn, an indigent criminal defendant charged with first-degree capital murder. The jury found Mr. Dunn guilty as charged, but his attorneys were successful in limiting the penalty to life imprisonment.

After entry of Mr. Dunn’s judgment and sentence, Ms. Redd submitted a bill for $162,820 to the Justice Administrative Commission (JAC). See § 27.5304(4)(a), (b)(1). The JAC filed a letter of objection to Ms. Redd’s bill, noting that an order from a circuit court judge was necessary to exceed the $15,000 statutory maximum on compensation for services by co-counsel in death penalty cases. See § 27.5304(5)(a)(4), (12)(d). Ms. Redd then filed a motion with the chief judge of the circuit court seeking an order approving payment of attorney’s fees in excess of the statutory maximum. See § 27.5304(12)(a).

After an evidentiary hearing, the circuit court filed an order on December 13, 2013, awarding Ms. Redd $118,000 in attorney’s fees. Section 27.5304(12)(b)(2) requires the court, after holding an evidentiary hearing, to “enter a written order detailing his or her findings and identifying the extraordinary nature of the time and efforts of the attorney in the case which warrant exceeding the flat fee established by

” On December 23, 2013, Ms. Redd served a motion for reconsideration and clarification asking the court to rehear the matter and requesting another evidentiary hearing. On January 14, 2014, the circuit court denied the motion, noting that section 27.5304 “does not authorize a motion for reconsideration or rehearing of an order granting excess attorney fees.” On February 12, 2014, Ms. Redd filed this petition for writ of certiorari.

A petition for writ of certiorari must be filed within thirty days of rendition of the order to be reviewed. See Fla. R. App. P. 9.100(c)(1). “An order is rendered when a signed, written order is filed with the clerk of the lower tribunal.” Fla. R. App. P. 9.020(i). The filing of “an authorized and timely motion for new trial, for rehearing, for certification, [or] to alter or amend” tolls rendition of a final order “until the filing of a signed, written order disposing of all such motions between such parties.” Fla. R. App. P. 9.020(i)(1). In this case, Ms. Redd filed her petition for writ of certiorari more than thirty days after the circuit court filed its order awarding attorney’s fees. Therefore, Ms. Redd’s petition for writ of certiorari is timely only if her motion for rehearing was authorized and timely so as to toll final rendition of the order awarding her attorney’s fees until the circuit court filed its order denying her motion for rehearing. We hold that Ms. Redd’s petition is timely because section 27.5304 constitutes a special statutory proceeding governed by the civil rather than criminal rules of procedure.

A motion filed pursuant to section 27.5304(12) is not an act of the State initiating prosecution against a criminal defendant. See Saucer v. State, 779 So.2d 261, 262 (Fla.2001) (“[P]erhaps the only true criminal proceeding is the one the State initiates against a defendant charging her with committing a criminal act.” (footnote omitted)). Rather, the court-appointed attorney must wait until final disposition of the defendant’s judgment and sentence to initiate the process to recover attorney’s fees,see § 27.5304(4)(a), and may only seek an award in excess of the statutory maximum by filing a motion with the chief judge of the circuit court. See § 27.5304(12)(a).

1088*1088 Thus, although such a motion arises from counsel’s representation of an indigent criminal defendant, it initiates a special statutory proceeding governed by the Florida Rules of Civil Procedure. See Fla. R. Civ. P. 1.010 (“These rules apply to all actions of a civil nature and all special statutory proceedings in the circuit courts and county courts except those to which the Florida Probate Rules, the Florida Family Law Rules of Procedure, or the Small Claims Rules apply.”); see also Fla. R. Civ. P.1.010 cmt. (“Criminal proceedings are the only ones clearly excluded from the coverage of the [Florida Rules of Civil Procedure].”).

As part of a special statutory proceeding governed by the Florida Rules of Civil Procedure, a motion for rehearing of an order entered pursuant to section 27.5304(12)(b)(2) awarding attorney fees is authorized if timely served. Although the circuit court noted that section 27.5304 does not explicitly authorize motions for rehearing of final orders awarding attorney fees, it is of equal significance that section 27.5304 does not specifically prohibit motions for rehearing. Florida Rule of Civil Procedure 1.010 provides that “[t]he form, content, procedure, and time for pleading in all special statutory proceedings shall be as prescribed by the statutes governing the proceeding unless these rules specifically provide to the contrary.” Therefore, a motion for rehearing of the order awarding attorney fees is authorized if served not later than ten days after the filing of that order. See Fla. R. Civ. P. 1.530(a), (b).^[1]

In this case, the circuit court filed its order awarding fees on December 13, 2013. Ms. Redd timely served her motion for rehearing on December 23, 2013. Final rendition of the order awarding attorney’s fees occurred when the circuit court filed its order denying her motion for rehearing on January 14, 2014. Accordingly, Ms. Redd timely filed her petition for writ of certiorari on February 12, 2014.

We note that Ms. Redd’s decision to file a petition for writ of certiorari instead of a notice of appeal is fully supported by the case law. See Sheppard & White, P.A. v. City of Jacksonville, 827 So.2d 925, 928 n. 3 (Fla.2002). The case law, however, evolved prior to the enactment of section 27.5304. See § 27.5304, Fla. Stat. (2004),added by ch. 2003-402, § 20, at 3670-71, Laws of Fla. (effective July 1, 2004); see also ch. 2003-402, § 153, at 3762, Laws of Fla. (effective July 1, 2004) (repealing sections 925.035-.037). The predecessors to section 27.5304 also permitted compensation in excess of the statutory maximums provided by section 925.036, Florida Statutes (2003), but merely required “a finding by a circuit court that the criminal case involved extraordinary circumstances such that the fee limits were inapplicable as a matter of law,” § 925.037(1), Fla. Stat. (2003), without establishing any extensive procedure for obtaining such a finding from the circuit court. Additionally, the counties were responsible for paying compensation to the court-appointed attorney, see § 925.035(6), Fla. Stat. (2003), while the JAC merely distributed funds for this purpose to the counties each fiscal year. See § 925.037(2). Under subsection (12) of the current statute, the motion filed with the chief judge effectively creates a separate statutory proceeding between the attorney and JAC, as the style of this case reflects, which ultimately results in the 1089*1089 JAC directly compensating the attorney rather than the county. See § 27.5304(1), (12)(f)(1)-(2), Fla. Stat. (2013).

In this case, the clerk of the circuit court docketed Ms. Redd’s section 27.5304(12) motion on the docket in Lee County Case number 08-CF-14594, which is the underlying criminal case in which she represented Mr. Robert Dunn. In the absence of alternative rules of procedure, that docketing makes sense, but the legal claim to be resolved exists between Ms. Redd and JAC. Mr. Dunn would seem to have no interest in this proceeding. Thus, although we do not hold at this time that the proceeding should be treated as a direct appeal of the final order between these parties, we recognize that logically that may now be the correct procedure.

Based on the foregoing, this court’s order to show cause is discharged. The respondent shall serve a response to the petition for writ of certiorari within twenty days of the date of this order. The petitioner may serve a reply within twenty days thereafter.

ALTENBERND, CASANUEVA, and SILBERMAN, JJ., Concur.

[1] When the circuit court filed its order awarding fees on December 13, 2013, Ms. Redd had 10 days to timely serve her motion for rehearing under the then-current version of Florida Rule of Civil Procedure 1.530(b). We note that the current version of rule 1.530(b) now provides 15 days for service of a motion for rehearing. See In re Amend. Fla. Rules Civ. Pro., 131 So.3d 643, 651 (Fla.2013).

 

J.W. C/O DAWN BROUN/FLAGLER HOSPITAL, Appellants,
v.
AGENCY FOR HEALTH CARE ADMINISTRATION, Appellees.

Case No. 1D13-5899.District Court of Appeal of Florida, First District.Opinion filed November 13, 2015.William Cleveland Acree, II, and Kenny J. Cantrell, of Quintairos, Prieto, Wood & Boyer, P.A., Orlando for Appellants.

Seann M. Frazier of Parker, Hudson, Rainer & Dobbs, Tallahassee, Amicus Curiae in support of Appellee Magellan Health Services.

Cynthia L. Hain, Assistant General Counsel, Tallahassee, for Appellee Agency for Health Care Administration.

MARSTILLER, J.

Appellant, J.W. is a Florida Medicaid recipient enrolled in Magellan Behavioral Health of Florida, Inc. (“Magellan”), a Managed Care Organization under contract with the Agency for Health Care Administration (“AHCA”). On May 5, 2013, J.W. was admitted to Flagler Hospital under the Baker Act^[1] with observed paranoia, delusion, and flight of ideas, and received psychiatric treatment. On May 10, 2013, Flagler Hospital submitted a prior authorization request to Magellan for Appellant to continue receiving in-patient psychiatric treatment. Magellan denied the request citing a lack of medical necessity for the requested level of care beyond May 9, 2013. J.W. sought an internal appeal with Magellan regarding the denial. Magellan issued an Appeals Decision letter dated May 14, 2013, upholding the denial of preauthorization for in-patient psychiatric services. The letter advised J.W. of his right to seek further review through a fair hearing conducted by the Department. In the meantime, Flagler Hospital continued providing J.W. in-patient psychiatric treatment until he was transferred to Northeast Florida State Hospital on June 19, 2013.

Thereafter, Dawn Broun, an employee of Flagler Hospital, acting as J.W.’s authorized representative, submitted a fair hearing request on his behalf to the Department of Children and Families (“DCF”).^[2] At the telephonic hearing, counsel for Magellan contended that because J.W. received the requested treatment from Flagler Hospital, the matter ceased to be subject to a fair hearing and was now a dispute between the hospital and Magellan over payment for the treatment. DCF’s hearing officer agreed, determined the agency lacked jurisdiction over the matter, and dismissed J.W.’s hearing request. Reviewing DCF’s ruling on jurisdiction de novo, see Mora v. McDonough, 934 So. 2d 587, 588 (Fla. 1st DCA 2006), we conclude the ruling was correct.

In Florida, Medicaid only authorizes and pays for those covered services deemed medically necessary. See Fla. Admin. Code R. 59G-1.010(166); see also 42 C.F.R. § 440.230(d) (providing that the state Medicaid agency “may place appropriate limits on a service based on such criteria as medical necessity or on utilization control procedures”). According to the Medicaid Provider Reimbursement Handbook, CMS-1500 (July 2008) (“Handbook”), incorporated by reference in Florida Administrative Code Rule 59G-4.001(1), certain services, including in-patient psychiatric services, require prior authorization—i.e., a determination before services are provided that they are medically necessary— before a provider can be reimbursed. See Handbook at 3-2. Under Federal law, a state must “provide for granting an opportunity for a fair hearing before the State [Medicaid] agency to any individual whose claim for medical assistance under the plan is denied or is not acted upon with reasonable promptness[.]” 42 U.S.C. § 1396a(a)(3); see also 42 C.F.R. 431.220(a)(2) (“The State [Medicaid] agency must grant an opportunity for a hearing to . . . [a]ny beneficiary who requests it because he or she believes the agency has taken an action erroneously.”). Although AHCA is the Medicaid agency for Florida, see sections 409.901(2), 409. 902(1), Florida Statutes, DCF is responsible for conducting fair hearings. See §§ 409.285, 409.902(1), Fla. Stat.; Fla. Admin. Code R. 65-2.042 et seq.

Under this statutory and regulatory scheme, J.W., as a Medicaid beneficiary, was entitled to a fair hearing to challenge Magellan’s denial of prior authorization for Medicaid-covered inpatient psychiatric treatment after May 9, 2013. But then, before seeking such hearing, J.W. received the requested treatment from his health care provider—Flagler Hospital. DCF was correct to dismiss J.W.’s fair hearing request under these circumstances because, once he received the continued psychiatric treatment he’d asked for, he no longer needed agency review of Magellan’s decision not to authorize the treatment. Rather, the issue at that point became whether Flagler Hospital could be paid by Medicaid for the services it had rendered without prior authorization. And that is not, under 42 U.S.C. section 1396a(a)(3), an issue that a Medicaid beneficiary has the right to seek a fair hearing on. As such, DCF correctly dismissed J.W.’s hearing request, and we affirm the Final Order of Dismissal on appeal.

AFFIRMED.

WOLF and SWANSON, JJ., CONCUR.

NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED.

[1] See § 394.467, Fla. Stat.

[2] AHCA asserts for the first time on appeal that the hearing request was untimely. We therefore do not address the argument. In any event, the record does not clearly establish the request was, in fact, untimely.

 

941 So.2d 1220 (2006)

MARTIN DAYTONA CORPORATION, etc., Appellant,
v.
STRICKLAND CONSTRUCTION SERVICES, etc., et al., Appellees.

No. 5D05-2432.District Court of Appeal of Florida, Fifth District.

November 17, 2006.1221*1221 John H. Dannecker and Jennifer P. Sommerville of Shutts & Bowen LLP, Orlando, for Appellant.

Rosemary Hanna Hayes and Tina L. Caraballo of Hayes & Caraballo, PL, Orlando, for Appellees.

SAWAYA, J.

This case presents the issue whether rule 1.525, Florida Rules of Civil Procedure, which requires that motions for attorneys’ fees and costs be served “within 30 days after filing of the judgment,” applies to motions filed in the circuit court based on awards emanating from arbitration 1222*1222 proceedings and, if so, whether a motion served before entry of the judgment is timely under the rule. We believe that the ruleis applicable in this instance and that a motion served prior to entry of the judgment is timely.^[1] The facts and procedural background are important to our analysis, so we will begin our discussion there.

Facts and Procedural Background

Martin Daytona Corporation (Martin) filed suit against Strickland Construction Services (Strickland) in circuit court seeking to recover an unpaid debt pursuant to a contract that had been entered into between the parties. The contract contained an arbitration clause, which provided that the prevailing party shall be entitled to recover reasonable attorneys’ fees.^[2] On January 4, 2005, the arbitration award was issued in favor of Martin, which was declared to be the prevailing party. On January 6, 2005, Martin moved to confirm the arbitration award in the circuit court pursuant to section 682.12, Florida Statutes (2005), and sought entry of a final judgment with a reservation of jurisdiction to award attorneys’ fees and costs. Simultaneously, Martin filed and served its motion to tax attorneys’ fees and costs based on its prevailing party status. The order confirming the arbitration award was entered by the circuit court on April 18, 2005, and a few days later, the final judgment reserving jurisdiction to determine the amount of fees and costs was entered.

Strickland filed an objection to the motion for fees and costs, arguing that it had been prematurely filed before the final judgment had been entered in violation of the time requirements of rule 1.525. Martin responded that rule 1.525 does not apply to arbitration proceedings and that its motion was timely. The circuit court found that the motion for attorneys’ fees and costs was premature, that rule 1.525 applied, and that Martin’s failure to comply with the time requirement of this rule was the result of attorney error, not excusable neglect.^[3] Therefore, it denied the 1223*1223 motions for attorneys’ fees and costs. Martin appeals. Because the parties do not agree on the proper standard of review we must apply to resolve the issue before us, we will make that determination before proceeding further.

Standard of Review

The parties do agree on the facts regarding when the motion for fees and costs was filed and served in relation to rendition of the judgment. Therefore, we must interpret the provisions of rule 1.525 to determine whether the rule applies and whether the motion for fees and costs was timely served. This is a legal issue that requires application of the de novo standard of review. See Gosselin v. Gosselin, 869 So.2d 667, 668 (Fla. 4th DCA 2004) (“Because the trial court’s determination that the Wife’s amended motion for attorney’s fees was barred by Florida Rule of Civil Procedure 1.525 is a legal determination, we review it de novo.“) (citing Execu-Tech Bus. Sys., Inc. v. New Oji Paper Co., 752 So.2d 582, 584 (Fla.2000)).

Applicability of Rule 1.525 to Motions for Fees and Costs Based on Awards Emanating from Arbitration Proceedings

In order to determine whether rule 1.525 applies to the instant case, we must analyze how attorneys’ fees and costs are awarded in arbitration proceedings. Unless the parties specifically agree that the arbitrator will decide the issues of entitlement to, and amount of, attorneys’ fees, those issues must be decided by the circuit court.^[4] Here, the parties agreed that the arbitrator would decide who the prevailing party was.^[5] Therefore, the arbitrator decided Martin’s entitlement to fees by finding Martin to be the prevailing party, but properly declined to award the amount of fees because the parties did not agree that the arbitrator would make that determination. Hence, the issue for the circuit court to decide was the amount of fees and costs Martin was entitled to recover.

1224*1224 If the court must decide either entitlement to or the amount of fees, or both, typically a motion to confirm the award and a motion to tax fees and costs are served, often at the same time.^[6] This is what Martin did. These motions place the issue of fees and costs before the court for determination at the same time confirmation is decided. The court conducts a judicial proceeding to resolve the issues raised in the motions, and we believe that rule 1.525 is applicable to provide time limitations for serving the motion for fees and costs. We are not alone in adopting this view; recent case law from another district court has applied rule 1.525 to a motion for fees and costs based on an award emanating from arbitration proceedings. See Certified Marine Expeditions v. Freeport Shipbuilding, Inc., 914 So.2d 983 (Fla. 1st DCA 2005).

Martin’s argument that rule 1.525 does not apply to arbitration proceedings is premised on rule 1.010, Florida Rules of Civil Procedure, which provides that the civil procedure rules “apply to all actions of a civil nature.” Martin contends that pursuant to Miele v. Prudential-Bache Securities, Inc., 656 So.2d 470 (Fla.1995), the term “actions of a civil nature” does not include arbitration proceedings. The court inMiele considered the issue whether section 768.73, Florida Statutes (1991), which addressed limitations on punitive damage awards, applied to arbitration proceedings. That statute provided, in pertinent part, that it applied to “any civil action” that fell within certain categories of tort actions. § 768.73, Fla. Stat. (1991). The court held that the term “civil action,” as used in the statute, did not include arbitration proceedings. Miele, 656 So.2d at 472. Hence, Martin argues that the term “actions of a civil nature” in rule 1.010 does not include arbitration proceedings and, therefore,rule 1.525 does not apply.

Subsequent to the decision in Miele, the Legislature enacted section 768.737 Florida Statutes (1999), which provides that sections 768.72, 768.725, and 768.73 do apply when punitive damages are available as a remedy in arbitration proceedings. “It is an accepted rule of statutory construction that the legislature is presumed to be acquainted with judicial decisions on the subject concerning which it subsequently enacts a statute.” Ford v. Wainwright, 451 So.2d 471, 475 (Fla.1984). Generally, courts are permitted to consider subsequently enacted legislation in determining the meaning of a statute.^[7] It is 1225*1225 clear that the Legislature’s enactment of section 768.737 indicates that the Legislature has a different view from that adopted by the court in Miele regarding the issue whether arbitration proceedings are “civil actions” within the meaning of section 768.73. We believe that enactment of section 768.737, in light of the decision in Miele, militates in favor of the view that the term “actions of a civil nature” in rule 1.010 includes motions for fees and costs filed in the circuit court that are based on awards emanating from arbitration proceedings.

Having determined that rule 1.525 applies, we must next decide whether serving the motion for fees prior to entry of the judgment violated the time limitations of the rule. We believe that service was timely, and we will explain why.

Serving the Motion for Fees and Costs Prior to Entry of the Final Judgment does Comply with the Time Requirements of Rule 1.525

Rule 1.525 establishes a deadline for parties to serve motions for attorneys’ fees and costs after a judgment has been entered. At the outset we note, parenthetically, that although many cases discuss the requirements of the rule in terms of filing the motion, the rule specifically requires timely service of the motion. See Certified Marine Expeditions. Here, there is no doubt that the motion was filed and served prior to entry of the judgment.

Rule 1.525 was adopted by the Florida Supreme Court and became effective on January 1, 2001. Amendments to the Fla. Rules of Civil Procedure, 773 So.2d 1098 (Fla.2000). Prior to that time, the courts generally required that any such motion be filed and served within a reasonable time after the judgment is entered. See Carter v. Lake County, 840 So.2d 1153, 1156 (Fla. 5th DCA 2003). However, the reasonable time rule was vague and produced inconsistent results in similar cases. As a result, the court adopted rule 1.525 “to eliminate the reasonable time rule and establish a time requirement to serve motions for costs and attorney’s fees.” Id.

The initial version of rule 1.525 required the motion to be served within 30 days of the filing of the judgment. Yet, requiring the motion to be served within 30 days still caused confusion because it was difficult to discern whether the language constituted a deadline or a narrow window of opportunity. Cases decided by the First, Third, and Fourth District Courts construing the initial version of rule 1.525 held that the rule set an outside deadline for serving a motion for attorneys’ fees and costs and that motions served prior to entry of the judgment were timely. See Byrne-Henry v. Hertz Corp., 927 So.2d 66, 68 (Fla. 3d DCA 2006); Swift v. Wilcox, 924 So.2d 885, 887 (Fla. 4th DCA 2006) (“[W]e hold that Rule 1.525 `establishes the latest point at which a prevailing party may serve a motion for fees and costs.'”) (quoting Norris v. Treadwell, 907 So.2d 1217, 1218 (Fla. 1st DCA 2005), review dismissed, 934 So.2d 1207 (Fla.2006)).

The Second District Court, on the other hand, has held that the initial version of therule established a window of opportunity between the rendering of the judgment and thirty days thereafter to serve a motion for fees and costs. See Swann v. Dinan, 884 So.2d 398 (Fla. 2d DCA 2004). We believe that the First, Third, and Fourth District Courts have correctly decided the issue and, as they did, we hold that motions served prior to, or within thirty days after, rendition of the final judgment are timely under the rule.

1226*1226 We note that in order to alleviate the confusion, rule 1.525 was amended effective January 1, 2006, to provide that the motion should be served no later than30 days after the judgment. In re Amendments to the Fla. Rules of Civil Procedure,917 So.2d 176, 187 (Fla.2005). We believe that the amendment to the rule clearly establishes a deadline beyond which motions for fees and costs are deemed untimely. Although we believe that this was the intended meaning of the version of the rule prior to its amendment, now there should be no doubt.

Conclusion

We conclude that the provisions of rule 1.525 apply to motions for attorneys’ fees filed in the circuit court based on awards emanating from arbitration proceedings when the parties did not agree to have the issue of fees and costs resolved by the arbitrators. Here, the issue of the amount of fees was placed before the circuit court for resolution, and it was entirely proper for Martin to file and serve its motion with the court prior to entry of the judgment. Thus, the motion was not premature, and the circuit court erred in denying Martin’s motion for attorneys’ fees on this basis. We reverse the order denying fees and remand this case to the circuit court to determine the amount to be awarded Martin as the prevailing party.

REVERSED and REMANDED.

MONACO and TORPY, JJ., concur.

[1] Martin argues that it did not have to timely file the motion to tax fees and costs because the final judgment specifically reserved jurisdiction over those issues. Strickland claims this argument has not been preserved because it was not presented to the circuit court. A review of the record reveals that Strickland’s claim is accurate; the argument was not presented to the circuit court and thus has not been preserved for appellate review. Herskovitz v. Hershkovich, 910 So.2d 366 (Fla. 5th DCA 2005);Wilson v. State, 675 So.2d 613 (Fla. 2d DCA 1996), review denied, 717 So.2d 542 (Fla.1988). Nevertheless, the court in Saia Motor Freight Line, Inc. v. Reid, 930 So.2d 598 (Fla.2006), held that reservation of jurisdiction to award attorneys’ fees and costs does not affect or alter the timeliness requirement found in rule 1.525 to file the attendant motion.

[2] The arbitration clause provided:

Notwithstanding governing provisions of the General Contract, all claims, disputes and other matters in question between the Contractor and Subcontractor arising out of, or relating to, this Subcontract or the breach thereof, shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association unless the parties mutually agree otherwise. The parties agree that the locale for such arbitration shall be in Orange County, Florida. The prevailing party in any arbitration or litigation shall be entitled to recover reasonable attorneys’ fee for the services of its attorney both at trial and appeal, if any. A prevailing party is the party who wins; unless the award is not at least 25% greater than prior written offer to settle made prior to commencement of the arbitration proceeding, in which case the rejected offer shall be deemed to have prevailed.

[3] Martin contends that the trial court erred in rejecting its argument based on excusable neglect. This issue is rendered moot by virtue of our resolution of the issue regarding the applicability and meaning of the provisions of rule 1.525.

[4] See § 682.11, Fla. Stat. (2005) (“Unless otherwise provided in the agreement or provision for arbitration, the arbitrators’ and umpire’s expenses and fees, together with other expenses, not including counsel fees, incurred in the conduct of the arbitration, shall be paid as provided in the award.”) (emphasis added); Turnberry Assocs. v. Serv. Station Aid, Inc., 651 So.2d 1173 (Fla.1995)(holding section 682.11, Florida Statutes, prohibits arbitrators from including attorneys’ fees in an award of expenses and fees incurred during arbitration proceedings, unless parties expressly waive the right to the trial court’s determination of entitlement to and amount of fees); A-1 Duran Roofing, Inc. v. Select Contracting, Inc., 865 So.2d 601, 604 (Fla. 4th DCA 2004) (“Neither entitlement to attorney’s fees, nor amount, are issues that the arbitrator may decide without the agreement of the parties.”);Josephthal Lyon & Ross, Inc. v. Durham, 734 So.2d 487, 489 n. 2 (Fla. 5th DCA 1999); Charbonneau v. Morse Operations, Inc., 727 So.2d 1017, 1020 (Fla. 4th DCA 1999) (“[I]t is well settled that an arbitrator has no authority to award attorney’s fees absent an express waiver of the limitation contained in section 682.11, Florida Statutes.”); Dean Witter Reynolds, Inc. v. Wood, 676 So.2d 464 (Fla. 5th DCA 1996).

[5] We reject Strickland’s assertion that the arbitrator did not have the authority to determine who the prevailing party was for purposes of entitlement to attorney’s fees. We have carefully reviewed the transcript of the arbitration hearing and we conclude that the parties did agree that the arbitrator would decide that issue and that the circuit court would determine the amount of fees to be awarded. We also think it noteworthy that Strickland filed a post-hearing motion arguing that it should be deemed the prevailing party and submitted a proposed order to the arbitrator declaring it to be the prevailing party. Moreover, Strickland did not move to vacate the award pursuant to section 682.13(1)(c), Florida Statutes (2005), or move to modify or correct the award pursuant to section 682.14, Florida Statutes (2005).

[6] See Rock v. Prairie Bldg. Solutions, Inc., 854 So.2d 722, 724 (Fla. 2d DCA 2003) (“Thereafter, the Rocks moved to confirm the arbitration award and to determine attorney’s fees and costs.”);Josephthal Lyon & Ross, Inc., 734 So.2d at 488 (“Durham thereafter applied to the circuit court for confirmation of the award and determination of a reasonable attorney’s fee.”); Zac Smith & Co., Inc. v. Moonspinner Condo. Ass’n, Inc., 534 So.2d 739, 741 (Fla. 1st DCA 1988) (“[A]ppellee moved the trial court to confirm the arbitration award and to assess attorney fees and costs against appellants.”); see also Moser v. Barron Chase Sec., Inc., 783 So.2d 231, 232 (Fla.2001) (“Moser[] petition[ed] to correct and confirm the arbitration award and . . . petition[ed] for an award of attorney’s fees. . . . “).

[7] See G.E.L. Corp. v. Dep’t of Env’t Prot., 875 So.2d 1257, 1262 n. 2 (Fla. 5th DCA 2004) (citingState, ex rel. Szabo Food Servs., Inc. of NC v. Dickinson, 286 So.2d 529 (Fla.1973); Gay v. Canada Dry Bottling Co., Inc. of Fla., 59 So.2d 788, 790 (Fla.1952); K.H. v. State, 821 So.2d 1202 (Fla. 5th DCA 2002); Equity Corp. Holdings, Inc. v. Department of Banking & Fin., Div. of Fin., 772 So.2d 588, 590 n. 7 (Fla. 1st DCA 2000) (“Courts are permitted to consider subsequent legislation as evidence of the legislature’s intent in construing a statute.”); Gamble v. State, 723 So.2d 905, 907 (Fla. 5th DCA 1999) (“[O]ur courts have a duty to consider subsequent legislation in arriving at a correct interpretation of a prior statute.”); State, Dep’t of Bus. & Prof’l Regulation, Div. of Pari-Mutuel Wagering v. WJA Realty Ltd. P’ship, 679 So.2d 302 (Fla. 3d DCA 1996)).

 

959 So.2d 223 (2007)

Rose G. CAMPBELL, Petitioner,
v.
Clivens GOLDMAN, Respondent.

No. SC06-611.Supreme Court of Florida.June 14, 2007.224*224 Richard A. Sherman, Sr., P.A., Fort Lauderdale, FL, Samuel Tyler Hill of Hill and Lemongello, P.A., Fort Lauderdale, FL, and Charles W. Hall and Mark D. Tinker of Fowler, White, Boggs, and Banker, P.A., St. Petersburg, FL, for Petitioner.

Arnold R. Ginsberg of Ginsberg and Schwartz, Miami, FL, and Nicole Sophia Freedlander of Nelson and Freedlander, Miami, FL, for Respondent.

QUINCE, J.

This case is before the Court for review of the decision of the Fourth District Court of Appeal in Goldman v. Campbell, 920 So.2d 1264 (Fla. 4th DCA 2006). The district court certified that its decision is in direct conflict with the decisions of the Second District Court of Appeal in McMullen Oil Co. v. ISS International Service System, Inc., 698 So.2d 372 (Fla. 2d DCA 1997), and the First District Court of Appeal inPippin v. Latosynski, 622 So.2d 566 (Fla. 1st DCA 1993). We have jurisdiction. Seeart. V, § 3(b)(4), Fla. Const. For the following reasons, we quash the decision of the Fourth District and approve McMullen Oil Co. and Pippin.

FACTS AND PROCEDURAL HISTORY

In a civil action between Clivens Goldman as plaintiff and Rose G. Campbell as defendant, a notice of filing of plaintiff’s proposal for settlement for $10,000 was served on the defendant on August 13, 1999, and again on November 17, 2003. The proposal was never accepted, nor was it filed with the trial court. More notably, the proposal made reference to Florida Rule of Civil Procedure 1.442 but did not cite the applicable statute, section 768.79, Florida Statutes (2003). On May 27, 2004, the jury returned a verdict in favor of plaintiff in the amount of $18,900, and the trial court entered a final judgment for that amount. This judgment met the statutory requirement that the recovery must be at least twenty-five percent greater than the settlement offer in order for the plaintiff to be entitled to attorney’s fees and costs. See Goldman v. Campbell, 920 So.2d 1264 (Fla. 4th DCA 2006).

Goldman filed a motion for attorney fees and costs after recovering the net verdict and judgment, and the trial court denied the motion. On appeal, the Fourth District noted, “An offer of settlement must comply with both rule 1.442 and section 768.79.”Goldman, 920 So.2d at 1265.^[1] 225*225 The district court indicated, citing to Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So.2d 276, 278 (Fla.2003), that both rule 1.442 and section 768.79 are in derogation of the common law rule that parties are responsible for their own attorney’s fees. Finally, the district court said the statute and the rule must be strictly construed pursuant to Sarkis v. Allstate Insurance Co.,863 So.2d 210, 218 (Fla.2003); Major League Baseball v. Morsani, 790 So.2d 1071, 1078-79 (Fla.2001), and TGI Friday’s, Inc. v. Dvorak, 663 So.2d 606, 615 (Fla.1995). The district court noted, “Following this principle of strict construction, we have found settlement proposals invalid when they did not comply with the statutory and rulerequirements.” Goldman, 920 So.2d at 1265 (citing Grip Dev., Inc. v. Coldwell Banker Residential Real Estate, Inc., 788 So.2d 262, 265 (Fla. 4th DCA 2000)). The district court also noted that other district courts have “similarly struck proposals.”Goldman, 920 So.2d at 1266 (citing Connell v. Floyd, 866 So.2d 90, 92 (Fla. 1st DCA 2004); McMullen Oil Co. v. ISS Int’l Serv. Sys., Inc., 698 So.2d 372, 373 (Fla. 2d DCA 1997); Pippin v. Latosynski, 622 So.2d 566, 569 (Fla. 1st DCA 1993)).

Despite its acknowledgment of the requirements of the applicable rule and statute, the Fourth District adopted the Fifth District’s view of these requirements as espoused in Spruce Creek Development Co. of Ocala, Inc. v. Drew, 746 So.2d 1109 (Fla. 5th DCA 1999). In Spruce Creek, the Fifth District found the failure of the settlement proposal to cite to the rule “an insignificant technical violation of the rule.”Id. at 1116. The Fourth District, however, certified conflict with Pippin v. Latosynski,622 So.2d 566 (Fla. 1st DCA 1993), and McMullen Oil Co. v. ISS International Service System, Inc., 698 So.2d 372 (Fla. 2d DCA 1997), both of which held under similar circumstances that the failure to cite to the applicable statute was error.

DISCUSSION

Campbell maintains this Court should follow Lamb v. Matetzschk, 906 So.2d 1037 (Fla.2005), and Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So.2d 276 (Fla.2003), which reaffirmed the “bright line rule” regarding strict construction of the offer of judgment statute and rule. Thus, Campbell contends this Court should reverse the decision of the district court. Conversely, Goldman argues strict construction should be applied whenever substantive, not procedural matters are implicated and thus the decision should be approved. The question before this Court is one of law subject to the de novo standard of review. See S. Baptist Hosp. of Fla. v. Welker, 908 So.2d 317 (Fla.2005). The issue here involves the settlement 226*226proposal and whether it was valid even though it did not reference section 768.79.

The settlement proposal in this case referenced Florida Rule of Civil Procedure 1.442, entitled “Proposals for Settlement.” Specifically, rule 1.442(a) reads in pertinent part as follows:

This rule applies to all proposals for settlement authorized by Florida law, regardless of the terms used to refer to such offers, demands, or proposals, and supersedes all other provisions of the rules and statutes that may be inconsistent with this rule.

Rule 1.442(c), entitled “Form and Content of Proposal for Settlement,” provides in pertinent part: “(1) A proposal shall be in writing and shall identify the applicable Florida law under which it is being made.” (Emphasis added.) In addition to rule1.442, offers to settle are addressed by statute in section 768.79, Florida Statutes (2006). Section 768.79 is entitled “Offer of judgment and demand for judgment” and reads in relevant part as follows:

(1) In any civil action for damages filed in the courts of this state, . . . [i]f a plaintiff filed a demand for judgment which is not accepted by the defendant within 30 days and the plaintiff recovers a judgment in an amount at least 25 percent greater than the offer, she or he shall be entitled to recover reasonable costs and attorney’s fees incurred from the date of the filing of the demand. . . .

(2) . . . An offer must:

(a) Be in writing and state that it is being made pursuant to this section.

(Emphasis added.) Thus, both rule 1.442 and section 768.79 require an offer to settle to be in writing and to include a citation to the statute, i.e., the applicable Florida law.

As the Fourth District noted, both rule 1.442 and section 768.79 are in derogation of the common law rule that parties are responsible for their own attorney’s fees, and thus the statute and rule must be strictly construed. See Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So.2d 276, 278 (Fla.2003). Nonetheless, the Fourth District adopted the reasoning in Spruce Creek and found the omission of reference to the statute to be a mere technical violation. The district court erred in so holding.

Recently in Willis Shaw Express, Inc. v. Hilyer Sod, Inc., 849 So.2d 276 (Fla.2003),this Court addressed rule 1.442 and section 768.79 in the context of whether an offer of settlement to multiple parties must apportion the amounts applicable to each. In answering the question presented, we examined section 768.79 in its entirety and noted that this section was implemented by rule 1.442. We further noted that the rulewas amended in 1996 to require greater detail in settlement proposals. See In re Amendments to Fla. Rules of Civil Procedure, 682 So.2d 105, 107 (Fla.1996)(effective Jan. 1, 1997). We specifically found the language of the statute and rulemust be strictly construed because the offer of judgment statute and rule are in derogation of the common law rule that each party pay its own fees. Willis Shaw,849 So.2d at 278. We held: “[U]nder the plain language of rule 1.442(c)(3), an offer from multiple plaintiffs must apportion the offer among the plaintiffs.” Willis Shaw, 849 So.2d at 279; see also Lamb v. Matetzschk, 906 So.2d 1037 (Fla.2005) (reaffirming a strict construction of rule 1.442).

We find that the holding in Willis Shaw and Lamb regarding strict construction of the language in the offer of judgment statute and rule at issue in those cases is equally as applicable to the language from rule 1.442 and section 227*227 768.79 concerning the requirements of citing authority. Contrary to Goldman’s assertions, strict construction is applicable to both the substantive and procedural portions of the rule and statute. When read together the rule and statute provide parties with an unambiguous method for obtaining attorney fees. Section 768.79 provides a sanction against a party who unreasonably rejects a settlement offer. See Willis Shaw, 849 So.2d at 278. The plain language of the statute provides that an offer must state it is being made pursuant to this section. This is a mandatory requirement for this penal, fee-shifting provision. Because the overall subject is in derogation of the common law, all portions must be strictly construed. The district court erred in failing to strictly construe the plain language of the rule and statute.

CONCLUSION

Based on the plain language of section 768.79, an offer of settlement must state the statute on which it is based. Thus, we quash the decision of the Fourth District and approve McMullen Oil and Pippin to the extent that they are consistent with our decision.

It is so ordered.

LEWIS, C.J., and WELLS and CANTERO, JJ., concur.

PARIENTE, J., specially concurs with an opinion, in which ANSTEAD, J., concurs.

BELL, J., concurs in result only with an opinion.

PARIENTE, J., specially concurring.

I reluctantly agree with the majority that the plain language of section 768.79, Florida Statutes (2006), and Florida Rule of Civil Procedure 1.442(c) requires that an offer of settlement cite the Florida law on which it is based. Thus, a party submitting a proposal for settlement under the statute and rule is on clear notice that reference must be made to section 768.79.

My reluctance is a result of the inescapable logic of the Fourth District’s opinion. SeeGoldman v. Campbell, 920 So.2d 1264 (Fla. 4th DCA 2006). There is now only one statute governing offers of judgments implemented by rule 1.442. See Sarkis v. Allstate Ins. Co., 863 So.2d 210, 219 n. 6 (Fla.2003). Thus, the requirement that the offer reference the statute on which it is based no longer has any true meaning, especially in a case such as this one, where although the plaintiff omitted the reference to the statute, the plaintiff specified that the offer of judgment was made pursuant to rule 1.442. Certainly, there was no lack of clarity, uncertainty, or confusion in this offer. Nor can it be said that failing to allow attorney’s fees when there is such a “technical violation” vindicates the primary goal of the statute andrule, which is to “encourage settlements in order to eliminate trials if possible.”Unicare Health Facilities, Inc. v. Mort, 553 So.2d 159, 161 (Fla.1989).

Over the years I have expressed concern about whether either the rule or the statute is fulfilling its intended purpose of encouraging settlement or at times is having the opposite effect of increasing litigation. See, e.g., Lamb v. Matetzschk, 906 So.2d 1037, 1042-43 (Fla.2005) (Pariente, C.J., specially concurring). Because parties will now be on notice that all “t’s” must be crossed and “i’s” dotted, there should be no further litigation on this particular issue. And because the plain language of the statute and the rule requires the reference, the majority’s resolution in this case is satisfactory. But if the past history of litigation on offers of judgment is any indication, this will not be the last 228*228 time the Court must clarify the requirements of the ruleand statute.

ANSTEAD, J., concurs.

BELL, J., concurring in result only.

I agree with the determination to quash the Fourth District’s opinion in Goldman v. Campbell, 920 So.2d 1264 (Fla. 4th DCA 2006). I also agree that the plain language of section 768.79, Florida Statutes (1999), and Florida Rule of Civil Procedure 1.442 require an offer of settlement to reference the statute upon which the offer is based. However, because the statute and the rule are clear and unambiguous, I do not believe it is appropriate to invoke the questionable derogation canon. See Goldman,920 So.2d at 1273 (Farmer, J., concurring specially) (“There is no longer much reason to be suspicious of any legislative change in the common law because there is not much of it left unaffected by statutes.”); see also Jefferson B. Fordham & J. Russell Leach, Interpretation of Statutes in Derogation of the Common Law, 3 Vand. L.Rev. 438 (1950) (examining the questionable reasons for employing the derogation canon).

Section 768.79 is very clear and unambiguous in expressing the requirements of a settlement offer. The applicable portion of section 768.79 provides that a settlement offer must “[b]e in writing and state that it is being made pursuant to this section.” § 768.79(2)(a), Fla. Stat. (1999) (emphasis added). Thus, the statute unambiguously explains that a settlement offer must state the statute upon which the offer is based. Because “the language of the statute is clear and unambiguous and coveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation and construction.” A.R. Douglass, Inc. v. McRainey, 102 Fla. 1141, 137 So. 157, 159 (1931). Therefore, the majority’s use of the derogation canon is unnecessary and inappropriate.

Similarly, rule 1.442 is clear and unambiguous, thereby making the use of the derogation canon, or any other standard of interpretation, unnecessary and inappropriate. Rule 1.442(c)(1) unambiguously states that a settlement “proposal shall be in writing and shall identify the applicable Florida law under which it is being made.” (Emphasis added.) No confusion exists regarding the plain meaning of therule’s language. Moreover, if this court rule was ambiguous, the standard of construction stated in rule 1.010 would apply, not the derogation canon. See Fla. R. Civ. P. 1.010 (“These rules [of civil procedure] shall be construed to secure the just, speedy, and inexpensive determination of every action.”). As Judge Farmer noted below, “the derogation canon—created for statutory changes in substantive common law—has no logical purpose or use in the interpretation of mere rules of procedure.”Goldman, 920 So.2d at 1270 (Farmer, J., concurring specially).

Accordingly, because the language of section 768.79 and rule 1.442 is clear and does not require construction, I concur in result only.

[1] The district court noted that rule 1.442(c)(1) states: “A proposal [for settlement] shall be in writing and shall identify the applicable Florida law under which it is being made.” Goldman, 920 So.2d at 1265 (quoting rule 1.442(c)). Additionally, the district court also noted that section 768.79(6)(b) reads:

If a plaintiff serves an offer which is not accepted by the defendant, and if the judgment obtained by the plaintiff is at least 25 percent more than the amount of the offer, the plaintiff shall be awarded reasonable costs, including investigative expenses, and attorney’s fees, calculated in accordance with the guidelines promulgated by the Supreme Court, incurred from the date the offer was served.

Id. (quoting § 768.79(6)(b)). Specifically, the district court noted:

Subsection (2) lists the requirements of a valid settlement offer:

(a) Be in writing and state that it is being made pursuant to this section.

(b) Name the party making it and the party to whom it is being made.

(c) State with particularity the amount offered to settle a claim for punitive damages, if any. (d) State its total amount.

Id. (quoting § 768.79(2)).