SARASOTA TENNIS CLUB HOLDINGS, LLC v. COUNTRY CLUB OF SARASOTA HOMEOWNERS ASSOCIATION, INC. ( 2023 )

DISTRICT COURT OF APPEAL OF FLORIDA
SECOND DISTRICT
SARASOTA TENNIS CLUB HOLDINGS, LLC,
Appellant,
v.
COUNTRY CLUB OF SARASOTA HOMEOWNERS ASSOCIATION, INC.,
and MARY LOUISE GERRITSEN,
Appellees.
No. 2D22-2358
December 15, 2023
Appeal from the Circuit Court for Sarasota County; Andrea McHugh,
Judge.
Elliot B. Kula and W. Aaron Daniel of Kula and Associates, P.A., Miami,
for Appellant.
Elaine D. Walter and Yvette R. Lavelle of Boyd, Richards, Parker,
Colonnelli, P.L., Miami, for Appellees.
LUCAS, Judge.
Sarasota Tennis Club Holdings, LLC (the Tennis Club), appeals a
final summary judgment entered on its complaint against Country Club
of Sarasota Homeowners Association, Inc. (the HOA), and Mary Louise
Gerritsen. We affirm in part and reverse in part.
The Tennis Club owns a parcel within the Country Club of Sarasota
residential community on which it operates a for-profit tennis club.
Pursuant to a 1992 maintenance agreement between the Tennis Club's
predecessor and the HOA, the Tennis Club agreed to limit its activities on
its property to those normally associated with a tennis club. The
maintenance agreement also granted the HOA a right of first refusal to
purchase the Tennis Club's property, which reads: "The Homeowners
Association has the right of first refusal to permit the Homeowners
Association to purchase the Tennis Club property at some point in the
future should the Tennis Club elect to sell or file for bankruptcy."
In addition to the maintenance agreement, in 1992, the Tennis
Club's predecessor and the HOA entered into a drainage agreement,
which, in pertinent part, provides: "[The HOA] acknowledges that BAY
VENTURE [the Tennis Club's predecessor], its successor or assigns may
petition Sarasota County to rezone the tennis and clubhouse facilities
area. . . . [The HOA] hereby agrees that it shall not challenge a petition
for such rezoning on any drainage-related issue."
In 2016, the HOA filed a civil action against the Tennis Club,
alleging that the Tennis Club had breached these two agreements. The
HOA sought both injunctive and monetary relief. While that litigation
was pending, the Tennis Club sought to sell its property.
On August 28, 2017, the Tennis Club and a developer, Taylor
Morrison Homes, entered into a purchase and sale agreement for the
Tennis Club's property for $3,500,000. The HOA waived its right of first
refusal through a letter its counsel sent to the Tennis Club on October
13, 2017. However, according to the Tennis Club, Ms. Gerritsen and five
other board members began "secretly" discussing how the HOA might
nevertheless be able to purchase the Tennis Club's property. There is
2
record evidence that these individuals conducted closed board meetings
on this issue and directed the HOA's property manager not to approve
any minutes concerning any of these closed meetings, who instead
notated "that the minutes were not completed at this time."
On November 6, 2017, the HOA sent a letter to the Tennis Club
and Taylor Morrison claiming that an extension on the closing that had
been extended to Taylor Morrison (apparently, due to Hurricane Irma)
constituted a "material term" which "restarted" the HOA's right of first
refusal. The November 6 letter accused Taylor Morrison of keeping "the
Association in the dark" about this extension and admonished "Taylor
Morrison and their representatives [to] conduct themselves in a
straightforward manner." The final paragraph of the November 6 letter
stated that the HOA was "reviewing whether the Association would be
willing to waive the deed restriction contained in paragraph 5 of the 1992
[Maintenance] agreement allowing for a different use than that which is
contained therein."
There is, however, no such deed restriction.1 Ten days later, Taylor
Morrison withdrew from its agreement with the Tennis Club. When
asked in deposition why Taylor Morrison refused to close, its
representative testified that, among other issues, there were "outstanding
issues between the seller [the Tennis Club] and the association." The
representative was pointedly asked whether, if it weren't for the "issue"
between the Tennis Club and the HOA, would Taylor Morrison have
closed on its contract with the Tennis Club. Notably, the representative
did not respond "no," but rather: "That's difficult to say . . . ."
1 Indeed, Ms. Gerritsen later sent an email to the HOA's board that
stated: "[O]ne thing is certain – they [the Tennis Club] have the right to
develop the 11.34 acres into a residential unit [sic] . . . ."
3
In February 2018, the Tennis Club negotiated a second purchase
and sale agreement, this time in the amount of $2.3 million for a portion
of its property, with Robert Mitchell. The agreement with Mr. Mitchell
included a put option to convey the remaining Tennis Club property
(about 5.4 acres) for $1.2 million.
Shortly after notifying the HOA of this new agreement, the HOA
convened a special meeting. In communicating with the residents of the
Country Club of Sarasota, the HOA misstated the scope of development
being proposed and that the HOA's right of first refusal encompassed the
entire Tennis Club Property (when, in fact, that was not how the
purchase and sale agreement between the Tennis Club and Mr. Mitchell
was structured). The Tennis Club's president testified in deposition that
Mr. Mitchell became "very nervous" that he was "buying a lawsuit" with
the HOA if he were to close. Ultimately, Mr. Mitchell elected not to close
on his contract with the Tennis Club. His attorney sent correspondence
to the Tennis Club, which stated: "In reviewing the letter of [HOA's
counsel], it is abundantly clear that litigation would be instituted if the
HOA were not presented with these changes and provided their first
refusal rights." Shortly afterwards, the HOA approached the Tennis Club
about purchasing the Tennis Club's property at a lower price than what
the Tennis Club had negotiated with Mr. Mitchell.
In 2019 the Tennis Club filed a rezoning petition with Sarasota
County to pursue residential development on its property. Upon learning
of the petition, one of the HOA board members, Claudia Hurley, wrote an
email to Heritage Group, the property owner abutting the Tennis Club's
property. The email was copied to the HOA's property manager, board
president, and board member Ms. Gerritsen. In this email, Ms. Hurley
stated:
4
We feel that the proposed rezone petition could have a
negative effect on [the golf course property] in ways we
enumerated yesterday.
We have discussed the stormwater issues that could
have an impact on the golf course (should excess runoff drain
onto the course), or should it be necessary for the applicant to
enlarge of dredge the stormwater ponds that you own for
increased capacity. We have a suggestion, which we
respectfully offer:
Is it possible that Heritage Group could make a
preemptive statement and submit it to the county before the
April 18 public hearing, something along these lines:
"It is the recommendation of the Heritage Group that if
additional development is approved on the Tennis Club
Property that the property provide a stormwater retention
pond on the development property."
Later, Ms. Hurley sent other emails on this same topic to the
Heritage Group, stating the HOA "is concerned with drainage issues on
the proposed rezone site, especially now that it includes the full 11.3
acres."
Ultimately, the Tennis Club withdrew its rezoning application with
Sarasota County.
In November of 2019, the Tennis Club filed a complaint against the
HOA and Ms. Gerritsen, generally alleging that the HOA and five of its
directors (including Ms. Gerritsen) were responsible for the Tennis Club's
inability to sell its property to Taylor Morrison or to Mr. Mitchell. The
Tennis Club further claimed that the HOA, through Ms. Hurley,
effectively breached the 1992 maintenance agreement which precluded
the HOA from "challeng[ing] a petition for such rezoning on any drainage-
related issue." In the Tennis Club's operative complaint, count I alleged
tortious interference; count II asserted a claim that the HOA violated the
Florida Deceptive and Unfair Trade Practices Act (FDUTPA); count III was
5
for breach of contract (based on the 1992 maintenance agreement); and
count IV sought declaratory judgment about whether there was a
contractual basis to recover attorney's fees.
The parties engaged in discovery, and on January 21, 2022, the
HOA and Ms. Gerritsen filed a motion for summary judgment as to all
the counts of the complaint. On June 24, 2022, the circuit court entered
a final summary judgment against the Tennis Club. As to count I, the
court concluded that the Tennis Club's evidence was insufficient to show
that the failure of either Taylor Morrison or Mr. Mitchell to close on their
respective contracts with the Tennis Club was due to the defendants'
actions. Similarly, the court found there was insufficient evidence of
causation to prove a violation of FDUTPA. As to count III, the court
determined that the Tennis Club failed to provide evidence that the HOA
had committed a breach of the 1992 maintenance agreement. Finally,
the court concluded there was no justiciable controversy before the court
that warranted declaratory relief.
The Tennis Club has timely appealed the circuit court's summary
judgment. Our review is de novo. Cole v. Plantation Palms Homeowners
Ass'n, 371 So. 3d 413, 416 (Fla. 2d DCA 2023). "Under the new [2021
amendment] summary judgment standard, summary judgment is
warranted 'if the movant shows that there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a matter of
law.' " Pio v. Simon Cap. GP, 366 So. 3d 1200, 1203 (Fla. 2d DCA 2023)
(quoting Fla. R. Civ. P. 1.510(a)). Under the federal (and now Florida)
summary judgment standard, the moving party bears the initial burden
of showing that there are no genuine issues of material fact that should
be decided at trial. See id.6
From our de novo review, we cannot say that the HOA and Ms.
Gerritsen met their initial burden with respect to the first count of the
Tennis Club's complaint. We have previously summarized the elements
of a tortious interference claim:
In order to state a cause of action for tortious
interference, a plaintiff must allege: (1) the existence of a
business relationship; (2) knowledge of the relationship on the
part of the defendant; (3) an intentional and unjustified
interference with the relationship by the defendant; and (4)
damages to the plaintiff as a result of the breach of the
relationship.
Chicago Title Ins. Co. v. Alday-Donalson Title Co. of Fla., Inc., 832
So. 2d 810, 814 (Fla. 2d DCA 2002) (citing Tamiami Trail Tours, Inc.
v. Cotton, 463 So. 2d 1126, 1127 (Fla. 1985); Sec. Title Guarantee
Corp. of Balt. v. McDill Columbus Corp., 543 So. 2d 852, 854 (Fla. 2d
DCA 1989)). There does not appear to be any serious dispute over
the first two elements in this case.
The third element, however, is hotly disputed. Although the HOA
has a right of first refusal to purchase the Tennis Club's property, it does
not have a right to intentionally and unjustifiably interfere with the
Tennis Club's contracts in order to gain leverage and get a better price to
buy the Tennis Club's property for itself. In our view, there are material
facts that support the Tennis Club's allegations on this element—
evidence of alleged misrepresentations, concealment of board activities,
misleading communications, and overt conduct—that could, if proven,
satisfy the third element of the Tennis Club's intentional interference
claim. See Howard v. Murray, 184 So. 3d 1155, 1167 (Fla. 1st DCA
2015) ("[A]ny determination whether a defendant acted without
justification is also highly fact dependent and 'requires an examination of
7
the defendant's 'conduct, its motive, and the interests it sought to
advance.' " (quoting McDill Columbus Corp., 543 So. 2d at 855)).
There are also material facts in dispute as to the fourth element,
whether the defendants' actions were the cause of Taylor Morrison and
Mr. Mitchell terminating their respective contracts with the Tennis Club.
Causation is often a contested factual issue. See Restatement (Second)
of Torts § 766 (1979) ("The question whether the actor's conduct caused
the third person to break his contract with the other raises an issue of
fact."). We note that the termination of the two contracts practically
coincided with the alleged actions of the defendants. And both contract
purchasers, Taylor Morrison and Mr. Mitchell, testified that they were
concerned about issues with the HOA when they decided not to close. It
appears the circuit court may have been persuaded that because neither
of these parties laid the entirety of the blame, as it were, on the
defendants, there was no issue of disputed fact about causation. To the
extent that was the circuit court's view it was an erroneous one. See
Ariz. Chem. Co. v. Mohawk Indus., Inc., 193 So. 3d 95, 103 (Fla. 1st DCA
2016) ("The plaintiff need not show that the defendant's action was the
sole cause of the damages sought . . . ."); Cedar Hills Props. Corp. v. E.
Fed. Corp., 575 So. 2d 673, 678 (Fla. 1st DCA 1991) ("In all cases
involving problems of causation and responsibility for harm, a good
many factors have united in producing the result; the plaintiff's total
injury may have been the result of many factors in addition to the
defendant's tort or breach of contract. . . . In order to establish liability
the plaintiff must show that the defendant's breach was a 'substantial
factor' in causing the injury." (quoting 5 Corbin on Contracts § 999
(1964))); Fla. Std. Civ. Jury Instr. 408.4b n.2 ("Instruction 408.4b
(concurring cause) . . . does not set forth any additional standard for the
8
jury to consider in determining whether the tortious interference with a
business or contractual relationship was a legal cause of damage, but
only negates the idea that a defendant is excused from the consequence
of his or her tortious interference with a business or contractual
relationship because of some other cause concurring in time and directly
contributing to the same damages or loss."). From our review of the
record, the defendants failed to satisfy their initial summary judgment
burden on this element of count I.
Similarly, there were material facts in dispute in count III. Board
member Ms. Hurley sent an email to the Tennis Club's neighbor
suggesting it should object to the Tennis Club's rezoning petition
because of potential drainage issues—and went so far as to include
proposed language for that neighbor to use in an objection. Regardless
of how widespread that communication may have circulated or whether
it was ultimately effective, that email was evidence from which a
factfinder could conclude that the HOA breached the 1992 maintenance
agreement.
As to the remaining counts, we affirm the court's summary
judgment as to the Tennis Club's FDUTPA claim, count II, under the
authority of Applegate v. Barnett Bank of Tallahassee, 377 So. 2d 1150,
1152 (Fla. 1979). See also Rebman v. Follett Higher Educ. Group, Inc.,
575 F. Supp. 2d 1272, 1279 (M.D. Fla. 2008) ("Brandner and Rebman
challenge the act of breaching the Agreement as unfair or deceptive
rather than the act giving rise to the breach. This is precisely the type of
breach of contract claim that cannot be converted to a claim under
FDUTPA. . . . In order to assert proper FDUTPA claims, Brandner and
Rebman must have shown that the acts underlying the breach of
contract are, by themselves, unfair or deceptive."); Spiegel, Inc. v. F.T.C.,
9
540 F.2d 287, 293 (7th Cir. 1976) ("A practice is unfair when it offends
established public policy and when the practice is immoral, unethical,
oppressive, unscrupulous or substantially injurious to consumers.");
Bessinger v. Food Lion, Inc., 305 F. Supp. 2d 574, 583 (D.S.C. 2003)
("Yet, South Carolina law is clear: even an intentional breach of contract,
absent an adverse public impact, will not support a cause of action
under the SCUTPA."). We affirm the summary judgment as to count IV
without further comment.
Affirmed in part; reversed in part; remanded.
CASANUEVA and LABRIT, JJ., Concur.
Opinion subject to revision prior to official publication.
10