Third District Court of Appeal
State of Florida
Opinion filed January 4, 2023.
Not final until disposition of timely filed motion for rehearing.
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No. 3D22-630
Lower Tribunal No. 19-32573
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Oracle Elevator Company, etc.,
Appellant,
vs.
8660 Building, LLC, etc.,
Appellee.
An Appeal from the Circuit Court for Miami-Dade County, Maria D.
Ortiz, Judge.
Sheldon R. Rosenthal, for appellant.
Neil Rose (Hollywood); Law Office of Christopher F. Zacarias, and
Christopher F. Zacarias; and Jose M. Francisco, P.A., and Jose M.
Francisco, for appellee.
Before EMAS, HENDON, and MILLER, JJ.
HENDON, J.
The plaintiff below, Oracle Elevator Company, a Florida corporation,
f/k/a Mowrey Elevator Service (“Oracle”), appeals from the trial court’s
“Order Granting 8660 Building LLC’s Motion to Strike Oracle’s Complaint
for Pervasive Fraud on the Court and for Attorney’s Fees/Costs,” and from
the order denying Oracle’s motion for rehearing. We affirm.
In August 2017, 8660 Building, LLC (“8660”) purchased property, and
as part of the transaction, it assumed an elevator maintenance contract that
the previous owner and Oracle had entered into. Oracle emailed 8660 a
copy of the contract, and invited 8660 to renegotiate the contract for a
lower price. 8660 notified Oracle that it was cancelling the contract
because Oracle had not been able to provide “an even slightly legible copy
of the contract, and its terms and conditions are a mystery,” and requested
that Oracle send a new proposed contract, as it had previously offered.
In November 14, 2018, Oracle filed suit against 8660 in Miami-Dade
County Court, alleging 8660 breached the elevator maintenance contract
by failing to pay the monthly maintenance and repair charges due under
the contract. Oracle attached a copy of the alleged contract between
Oracle and the previous owner of the property.
8660 filed an answer, affirmative defenses, and a counterclaim. In its
affirmative defenses, 8660 asserted, among other things, that if there is a
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valid contract, Oracle failed to fulfill its obligations under the contract, and
that Oracle failed to state a cause of action because the “alleged contract is
illegible and therefore has failed to comply with Fla. R. Civ. P. 1.130(a).” In
its counterclaim, 8660 asserted Oracle was negligent by failing to properly
maintain the elevator, seeking damages for the replacement of the
elevator. The action was then transferred to the Circuit Court in October
2019.
During the proceedings, 8660 continued to request a legible copy of
the contract, but Oracle submitted copies that that were not completely
legible. Moreover, in a request for production relevant to its counterclaim,
8660 requested that Oracle produce the personnel file of its elevator
mechanic who primarily serviced the elevator. Following motions to
compel, the trial court ordered Oracle to produce portions of the elevator
mechanic’s personnel file, relating to his training, experience, and adverse
disciplinary action.
On August 5, 2020, Oracle filed the affidavit of its Regional Vice
President, in which he averred that the majority of Oracle’s business
records are located in its main office in Tampa, Florida. Although the office
was temporarily closed during COVID and no documents were being
provided to any requests made for documents, the office is now open, and
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Oracle provided the requested documents for the years 2015, 2016, and
2017.
On August 24, 2020, 8660 took the deposition duces tecum of
Oracle’s Regional Vice President, who is also Oracle’s records custodian.
During the deposition, he acknowledged that Oracle had not produced a
legible copy of the contract. He also acknowledged that Oracle’s personnel
files and contracts are kept electronically, and therefore, despite the
closure of Oracle’s Tampa office during COVID, the documents could have
been accessed electronically. Three days later, on August 27, 2020,
Oracle filed a “Notice of Filing Legible Copy of Elevator Maintenance
Agreement.” The filed “legible copy” was allegedly the contract at issue in
the instant case.
A deposition of Oracle’s Regional Vice President was conducted on
January 27, 2021. During that deposition, he acknowledged that the legible
contract eventually filed on August 27, 2020, was in Oracle’s possession
the entire time at Oracle’s Tampa office, and that it was a “true and correct
copy of the elevator maintenance agreement that Oracle is suing upon.”
In May 2021, 8660 filed a Motion to Strike Oracle’s Complaint for
Pervasive Fraud on the Court and for Attorney’s Fees/Costs (“Motion to
Strike for Fraud”). 8660 asserted that (1) Oracle withheld a legible copy of
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the contract at issue for the first two years of litigation; (2) in an effort to
defeat 8660’s defense that the alleged contract was not legible, on August
27, 2020, Oracle served a fabricated copy of the alleged contract by
“past[ing] the first and last page of the contract that it sued upon onto the
legible body of a completely different contract with an entirely different
party, and misrepresented the contract to be the one at issue in this
lawsuit”; (3) Oracle’s corporate representative falsely swore in a deposition
that the copy of the contract filed by Oracle on August 27, 2020, was a true
and correct copy of the contract at issue in the case; (4) Oracle violated
three court orders; and (5) Oracle submitted two false affidavits—one to
avoid sanctions, and the other to “artificially defeat” 8660’s motion for
summary judgment and to “subvert a decision based on the merits.”
Further, in its Motion to Strike for Fraud, 8660 submitted side-by-side
images of the contract attached to the complaint and the legible contract
submitted three years later on August 27, 2020. Oracle did not file a
response to 8660’s Motion to Strike for Fraud.
The trial court conducted an evidentiary hearing on 8660’s Motion to
Strike for Fraud in September 2021, during which, 8660 presented live
testimony and evidence. Oracle, however, did not present any evidence in
opposition and presented no live rebuttal witness. There is no transcript of
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the hearing in the record. The following month, the trial court held a status
conference where it announced its ruling after hearing closing argument.
There is no transcript of the status conference hearing in the record on
appeal.
On February 10, 2022, the trial court entered an order granting
8660’s Motion to Strike for Fraud with prejudice. First, the trial court noted
that it conducted a side-by-side comparison of the contract attached to the
complaint and the contract filed on August 27, 2020, and it is “clear” that at
“least one contract is a fabrication,” and that “upon examination, the
contracts discernably differ in substantive provisions and formatting.”
Moreover, the trial court found that Oracle “fabricated and submitted the
contrived contract as a legible copy of the Contract at issue,” and that “the
fabricated contract is a material misrepresentation and that fabrication of
evidence is on the central liability issue in the lawsuit: the legibility, and
thus enforceability, of the elevator maintenance agreement Plaintiff Oracle
sued upon.” Second, the trial court found that Oracle’s Regional Vice
President offered false testimony in an attempt to authenticate the
fabricated contract in his January 7, 2021 deposition by testifying that the
contract submitted on August 27, 2020 was a true and correct copy of the
contract Oracle was suing upon. The trial court found that Oracle’s
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misrepresentation constituted a material misrepresentation on a dispositive
issue. Third, the trial court found that Oracle submitted a false affidavit to
avoid sanctions for its failure to comply with two discovery orders to
produce records directly relevant to 8660’s counterclaim for negligence,
specifically the elevator mechanic’s personnel file relating to his training,
experience, and adverse disciplinary actions. Fourth, the trial court found
that Oracle failed to timely comply with three discovery orders issued on
March 3, 2020, June 6, 2020, and August 11, 2020. Fifth, the trial court
found that Oracle submitted a false affidavit in support of its damages claim
in opposition to 8660’s motion for summary judgment.
Based on the above findings and the relevant law, the trial court
concluded:
Here, Plaintiff Oracle’s conduct was directly related to the
parties’ claims and defenses. As in ICMFG [& Associates, Inc.
v. Bare Board Group, Inc.,
238 So. 3d 326 (Fla. 2d DCA 2017)],
Plaintiff Oracle intention[ally] concealed and altered evidence
that was central to the litigation in order to interfere with
Defendant 8660’s attempt to discover evidence favorable to it.
Therefore, on this record and having balanced the
competing policies of favoring adjudication on the merits with
the integrity of our judicial system, this Court concludes that (1)
the clear and convincing evidence in this case establishes that
Plaintiff Oracle has sentiently set into motion an
unconscionable scheme calculated to interfere with this Court’s
ability impartially to adjudicate this matter by unfairly hampering
the presentation of Defendant 8660’s defense and claim; and
(2) Plaintiff Oracle has demonstrated bad faith in discovery and
gross indifference to this Court’s discovery Orders. The Court
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recognizes that striking Plaintiff Oracle’s pleadings is a harsh
sanction. However, the gravity of Plaintiff Oracle’s behavior in
fabricating evidence and committing perjury in an attempt to
enhance its case warrants such a sanction. Thus, the Court
concludes that Plaintiff Oracle’s conduct warrants the sanction
of the striking of its pleadings and dismissal of its claims with
prejudice for fraud on the Court. The Court also concludes that
Defendant 8660 is entitled to recover all attorney’s fees and
costs it has incurred given Plaintiff Oracle’s conduct, as set
forth herein, and reserving ruling on the amount of fees and
costs to be awarded.
Oracle filed a motion for rehearing or reconsideration, which the trial
court denied. Oracle’s appeal followed.
Oracle contends the trial court abused its discretion by granting
8660’s Motion to Strike for Fraud. We disagree.
“[T]he dismissal of a party’s pleadings is a severe sanction, and thus
should be administered only in the most egregious cases. As a result, an
order striking pleadings for fraud upon the court is reviewed under a
‘narrowed’ abuse of discretion standard.” Empire World Towers, LLC v.
CDR Créances, S.A.S.,
89 So. 3d 1034, 1038 (Fla. 3d DCA 2012). The
abuse of discretion standard is “’somewhat narrowed’ as it must take into
account the heightened standard of ‘clear and convincing evidence’ upon
which an order of dismissal for fraud on the court must be based.” Suarez
v. Benihana Nat’l of Fla. Corp.,
88 So. 3d 349, 352 (Fla. 3d DCA 2012).
Although a severe sanction, “[a] trial court has the inherent authority to
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dismiss an action when it finds that a plaintiff has perpetrated a fraud on
the court.” Diaz v. Home Depot USA, Inc.,
196 So. 3d 504, 505 (Fla. 3d
DCA 2016) (quoting Medina v. Fla. E. Coast Ry., L.L.C.,
866 So. 2d 89
(Fla. 3d DCA 2004)). The party moving to dismiss an action based on
fraud on the court has the burden to establish, “clearly and convincingly,
that a party has sentiently set in motion some unconscionable scheme
calculated to interfere with the judicial system’s ability impartially to
adjudicate a matter by improperly influencing the trier of fact or unfairly
hampering the presentation of the opposing party’s claim or defense.” Cox
v. Burke,
706 So. 2d 43, 46 (Fla. 5th DCA 1998) (quoting Aoude v. Mobil
Oil Corp.,
892 F.2d 1115, 1118 (1st Cir.1989)). Further, “[w]hen reviewing
a case for fraud, the court ‘should consider the proper mix of factors’ and
carefully balance a policy favoring adjudication on the merits with
competing policies to maintain the integrity of the judicial system.” Cox,
706 So. 2d at 46 (quoting Aoude, 892 F.2d at 1118).
In the instant case, first, the record on appeal does not contain
transcripts of the evidentiary hearing held on 8660’s Motion to Strike for
Fraud or of the case management conference where the trial court heard
final arguments and issued its oral ruling. Second, Oracle failed to file a
response to 8660’s Motion to Strike for Fraud. Third, as indicated in the
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order granting 8660’s Motion to Strike for Fraud, at the evidentiary hearing,
Oracle did not present any evidence in opposition and presented no live
rebuttal witness. Thus, Oracle made no attempt to explain its position as to
why it submitted the fabricated contract on August 27, 2020, and why its
corporate representative falsely testified during a deposition that the
fabricated contract was a true and correct copy of the contract Oracle was
suing upon, when it clearly was not. The legibility of the sued-upon
contract was material to Oracle’s breach of contract claim asserted against
8660. Thus, based on the above, we conclude that the trial court did not
abuse its discretion by granting 8660’s Motion to Strike for Fraud.
Accordingly, we affirm the orders on appeal.
The remaining argument raised by Oracle lacks merit and does not
warrant discussion.
Affirmed.
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