GULFSTREAM PARK RACING ASSOC. v. MI-VI, INC. ( 2019 )


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  •           DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
    FOURTH DISTRICT
    GULFSTREAM PARK RACING ASSOCIATION, INC.,
    Appellant/Cross-Appellee,
    v.
    MI-V1, INC., a Florida corporation, GERRY KELLY, an individual, and
    XTREME ELECTRONICS SYSTEMS, INC., a Florida corporation,
    Appellees/Cross-Appellant.
    No. 4D18-1460
    [December 18, 2019]
    Appeal and cross-appeal from the Circuit Court for the Seventeenth
    Judicial Circuit, Broward County; John B. Bowman, Judge; L.T. Case No.
    CACE 10-030143.
    Alyssa M. Reiter and Jordan S. Cohen of Wicker Smith O’Hara McCoy
    & Ford, P.A., Fort Lauderdale, for appellant/cross-appellee.
    Kenneth E. Keechl of Kenneth E. Keechl, P.A., Wilton Manors, for
    appellee/cross-appellant MI-V1, Inc., a Florida corporation and appellee,
    Xtreme Electronics Systems, Inc., a Florida Corporation.
    MAY, J.
    The defendant in a landlord-tenant dispute appeals a final judgment.
    The landlord argues the trial court erred in instructing the jury on
    affirmative defenses for the lease’s guarantor after granting its motion for
    partial summary judgment against the guarantor. The tenant cross-
    appeals the final judgment against it. We agree with the landlord on the
    direct appeal and reverse for entry of a judgment against the guarantor.
    We affirm all issues on the cross-appeal without further comment.
    The landlord and tenant entered a five-year lease, which provided the
    tenant would pay monthly rent in exchange for use of the landlord’s
    premises as a nightclub. The guarantor guaranteed the lease, which
    provided that the guarantor:
    absolutely and unconditionally guarantees to [landlord] . . .
    the due prompt and punctual performance of all obligations
    of, and the prompt payment when due at all times hereafter
    of any and all amounts owed by its subsidiary, [tenant], under
    this Agreement (including any extensions . . .) to [landlord] . .
    ..
    The dispute arose when the landlord advised the tenant to vacate the
    premises. The tenant filed a complaint alleging the landlord sent a letter
    indicating it would no longer have access to the premises prior to the
    lease’s expiration and changed the locks on the door. The landlord
    answered and counterclaimed against the tenant for breach of contract for
    failure to pay rent. It also impleaded the guarantor.
    The tenant moved for partial summary judgment on liability against the
    landlord. The tenant alleged the landlord’s actions violated section
    83.05(2), Florida Statutes (2017) because it engaged in self-help to evict
    the tenant. The tenant relied on the landlord’s then-president’s testimony
    that he changed the locks on the premises so that tenant could not get in
    unless it paid rent. The tenant also relied on the landlord’s response to a
    request for admissions in which the landlord admitted that it never
    instituted judicial action against tenant in accordance with section
    83.05(2).
    The landlord responded the tenant had not sued the landlord for a
    violation of chapter 83 and failed to allege a specific lease provision it
    breached. The landlord also argued factual issues concerning the tenant’s
    breach of the lease prior to its eviction prevented a summary judgment
    and that the motion was procedurally improper. The trial court denied the
    motion leaving the issues for trial.
    The landlord moved for summary judgment on liability on its third-
    party claim against the guarantor.       It argued that the guarantor
    “absolutely and unconditionally agreed to guarantee” the lease and the
    tenant’s obligations. Because the tenant failed to meet its obligations, the
    guarantor was liable to the landlord. It further argued the guarantor
    waived all defenses.
    At the hearing on the motion, the guarantor argued that it could rely
    on the tenant’s defenses, including the landlord’s wrongful eviction, so the
    motion should be denied. The trial court responded:
    As far as the first motion, the [landlord’s] Motion for Summary
    Judgement against [guarantor] as to the liability issue, the
    lease appears to be pretty clear and unambiguous.
    Guarantees the debt, so I’m ruling therefore that motion is
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    granted as to the liability. Obviously, damages, if any, would
    have to be determined subsequently.
    The trial court’s order stated: “[s]ummary judgment is granted in favor
    of [landlord] . . . as to liability on its affirmative claims against [guarantor].”
    The claim proceeded to trial. The trial encompassed the: 1) tenant’s
    claims against the landlord; 2) landlord’s counterclaim against the tenant;
    and 3) landlord’s third-party claim against the guarantor on damages.
    The court instructed the jury on liability and damages. The landlord
    argued that the instructions concerning the guarantor’s defenses to
    liability should not apply to its third-party claim against the guarantor
    because summary judgment had been entered on the guarantor’s liability.
    The guarantor responded that the summary judgment was merely a
    finding there was a valid guaranty, but that it did not preclude the
    guarantor from presenting affirmative defenses on liability to the jury.
    The trial court ruled that the guarantor was “entitled to every one of the
    defenses, under the theory that they flow to you as the guarantor,” and
    proceeded to instruct the jury as follows:
    If the greater weight of the evidence does not support
    [landlord’s claim for breach of lease guaranty, then your
    verdict should be for [guarantor].
    ....
    [Guarantor]’s first defense is that – due to [landlord]’s illegal
    use of a ‘self-help’ eviction to remove [tenant] from the leased
    premises – [landlord] is not entitled to recover any sums from
    [guarantor].
    ....
    [Guarantor]’s third defense is that [landlord] first breached the
    lease and the guaranty and therefore [guarantor] has no
    obligations thereunder.
    The jury returned the following verdict.
    1. [Tenant]’s claim against [landlord]: [Landlord] breached
    the Lease, but proved one or more of its affirmative defenses.
    2. [Landlord]’s counterclaim against [tenant]:     [Tenant]
    breached the Lease and did not prove any of its affirmative
    defenses.
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    3. [Landlord]’s third-party claim against [guarantor]:
    [Guarantor] proved one or more of its affirmative defenses.
    The court entered a final judgment, which provided:
    1. Plaintiff/Counter-Defendant, [tenant] shall take nothing by
    this action against Defendant/Counter-Plaintiff [landlord].
    2. Defendant/Counter-Plaintiff, [landlord] shall recover two
    hundred      thousand    dollars    ($200,000)    against
    Plaintiff/Counter-Defendant, [tenant].
    3. Third-Party Plaintiff, [landlord] shall take nothing by this
    action against Third-Party Defendant, [guarantor].
    All three parties appealed the final judgment.
    The landlord argues the trial court erred in submitting the guarantor’s
    affirmative defenses to the jury because the trial court had previously
    granted summary judgment against the guarantor on liability. The
    guarantor admits that its affirmative defenses went to liability, but argues:
    1) it was entitled to submit its affirmative defenses; and 2) this court
    cannot determine whether the jury verdict was improperly rendered
    because its affirmative defenses went to the issues of both liability and
    damages. We agree with the landlord.
    We have de novo review of legal issues. Green v. Cottrell, 
    204 So. 3d 22
    , 26 (Fla. 2016).
    Summary final judgment operates as any other final judgment. It
    “‘determines and disposes of the whole merits of the cause before the Court
    . . . .’” Kaufman v. Heller, 
    616 So. 2d 1064
    , 1065 (Fla. 3d DCA 1993)
    (quoting Francisco v. Victoria Marine Shipping, Inc., 
    486 So. 2d 1386
    , 1391
    (Fla. 3d DCA 1986)). A final summary judgment precludes further
    litigation on the issues it encompassed. Advent Oil & Operating, Inc. v. S
    & E Enters., LLC, 
    48 So. 3d 70
    (Fla. 1st DCA 2010) (Benton, J., dissenting).
    Here, the trial court entered summary judgment on liability against the
    guarantor. The order stated: “[s]ummary judgment is granted in favor of
    [landlord] . . . as to liability on its affirmative claims against [guarantor].”
    The order was final as to the landlord’s claims against the guarantor on
    liability. Any affirmative defenses relating to liability were foreclosed from
    further litigation as to the guarantor, although it was entitled to benefit
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    from any favorable finding for the tenant on the liability issues between
    the landlord and tenant. But, the trial court erred in instructing the jury
    on affirmative defenses regarding the guarantor’s liability. Allowing the
    jury to separately consider the tenant and guarantor’s liability resulted in
    finding the tenant liable to the landlord, but the guarantor absolved from
    liability.
    The guarantor argues that even if it were precluded from presenting its
    affirmative defenses to liability to the jury, we cannot determine whether
    the verdict was improperly rendered because instructions on both liability
    and damages were submitted to the jury. We disagree.
    A guarantor is liable to the extent of the principal’s obligation.
    Anderson v. Trade Winds Enters. Corp., 
    241 So. 2d 174
    (Fla. 4th DCA
    1970). There, we held the note’s express language made the second
    guarantor liable for damages to the extent that the first guarantor was
    found liable. 
    Id. at 177.
    We reversed the portion of the final judgment
    which discharged the guarantors and directed the trial court to “enter
    judgment against the guarantors, jointly and severally, for the amount
    found owed on the note by the principal debtor . . . .” 
    Id. The same
    result is required here. Once the trial court determined the
    guarantor was liable for the tenant, it was subject only to the jury’s finding
    on the tenant’s liability. When the jury determined the tenant was liable
    for $200,000, the guarantor became liable for the same.
    We therefore reverse the final judgment in favor of the guarantor and
    remand the case to the trial court for entry of judgment against the
    guarantor based on the tenant’s liability for $200,000. We have reviewed
    the issues raised on the cross-appeal, but find no merit in them. We
    therefore affirm all issues on the cross-appeal.
    Affirm in part and reverse in part.
    TAYLOR and DAMOORGIAN, JJ., concur.
    *            *      *
    Not final until disposition of timely filed motion for rehearing.
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