In Hayward Baker, Inc. v.
Westfield Ins. Co., the Florida District Court of Appeal, Second District, reversed
a lower court’s order denying a subcontractor’s motion for attorneys’ fees
under Florida Statutes, Section 713.29. 2020
WL 7767859, at *1 (Fla. Dist. Ct. App. Dec. 30, 2020). The underlying case stemmed
from construction of an addition to University Community Hospital in Carrollwood,
Florida.
Diaz Fritz Group, Inc. (DFI) was
the general contractor for the project. DFI subcontracted with Hayward Baker,
Inc. (HBI) for foundation work with a contract amount of $290,000.00. After HBI
completed its work on the hospital project, DFI refused to pay HBI the
subcontract amount, claiming that HBI was responsible for remediating or paying
for damage DFI claimed HBI had caused to the hospital's existing building while
performing the foundation work. A dispute arose and three lawsuits ensued, including
one against the surety that issued DFI’s payment bond.
DFI sued HBI for breach of
contract seeking to recover the cost of remediating the damages to the hospital’s
existing building. HBI counterclaimed for breach of contract seeking to recover
the entire amount due under the subcontract.
DFI later filed an additional action
in federal court against HBI's insurance carrier, Zurich American Insurance
Company, to recover the same damages claimed in the suit against HBI directly. DFI
reached a settlement with Zurich under which Zurich agreed to pay DFI $450,000.
The remaining cases were
consolidated and tried before a jury. Shortly before trial, the parties
stipulated that HBI was entitled to $290,000 pursuant to the subcontract with DFI.
At the conclusion of the trial, the jury found HBI was responsible for
$266,596.32 of the damages caused to the hospital.
Both DFI and HBI moved for
attorney fees’ following the jury verdict and entry of the final judgment, contending
they were the “prevailing party.” The trial court denied both motions on the basis
that neither party was the prevailing party since both parties prevailed on
significant issues.
The trial court granted HBI’s
motion to set off the damages award against HBI to the hospital by the
$450,000.00 DFI received from HBI’s insurer, Zurich, through the prior settlement
of the third case. However, the lower court did not take the setoff into
consideration for determining which party prevailed on the significant issues,
contending the prevailing party determination would be “the same no matter what
the ruling on the setoff question was[.]”
HBI appealed the lower court’s
decision, arguing “because it succeeded on significant issues in the litigation
and achieved all of the benefit it sought against DFI, while DFI and [the
surety] achieved nothing, the trial court abused its discretion in failing to
find that HBI was entitled to attorneys' fees as the prevailing party.”
Under Florida law, the party who
prevails on the “significant issues in the litigation” is considered the prevailing
party for purposes of awarding attorneys’ fees. HBI argued it was awarded the full
amount due to it under the subcontract, despite being found to be responsible
for a portion of the damages to the hospital. The appellate court agreed with
HBI and reversed the lower court’s order denying HBI’s Motion for Attorneys’
Fees.
