CCM Condominium Association, Inc., etc. v. Petri Positive Pest Control, Inc., etc.

Supreme Court of Florida
____________
No. SC19-861
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CCM CONDOMINIUM ASSOCIATION, INC., etc.,
Petitioner,
vs.
PETRI POSITIVE PEST CONTROL, INC., etc.,
Respondent.
September 9, 2021
POLSTON, J.
We review the Fourth District Court of Appeal’s decision in
Petri Positive Pest Control, Inc. v. CCM Condominium Ass’n, 271 So.
3d 1001 (Fla. 4th DCA 2019), in which the Fourth District certified
the following question of great public importance:
FOR PURPOSES OF CALCULATING WHETHER A
PLAINTIFF HAS MET THE THRESHOLD AMOUNT OF
DIFFERENCE BETWEEN AN OFFER OF JUDGMENT
AND THE JUDGMENT ENTERED FOR PURPOSES OF
SECTION 768.79, FLORIDA STATUTES, MUST POST-
OFFER PREJUDGMENT INTEREST BE EXCLUDED
FROM THE AMOUNT OF THE “JUDGMENT OBTAINED”?
Id. at 1007. In its decision, the Fourth District also certified conflict
with the Third District Court of Appeal’s decision in Perez v. Circuit
City Stores, Inc., 721 So. 2d 409 (Fla. 3d DCA 1998), and the First
District Court of Appeal’s decision in Phillips v. Parrish, 585 So. 2d
1038 (Fla. 1st DCA 1991). Petri, 271 So. 3d at 1007. 1
Based upon this Court’s precedent and as explained below, we
answer the certified question in the affirmative, approve the Fourth
District’s decision in Petri, and disapprove the Third District’s
decision in Perez and the First District’s decision in Phillips to the
extent they are inconsistent with our decision today.
I. BACKGROUND
The Fourth District described the background of this case as
follows:
In 2013, the appellee/plaintiff, CCM Condominium
Association, Inc., sued the appellant/defendant, Petri
Positive Pest Control, Inc., for negligence and breach of
contract regarding the parties’ contract for Petri to
address a termite problem at CCM’s property. Petri
answered, denying the allegations. CCM served an
amended offer of judgment in 2014, pursuant to section
768.79, Florida Statutes. It offered to settle all of CCM’s
claims for damages, including punitive damages,
attorney’s fees, costs, and interest, for $500,000. Petri
rejected the offer.
1. We have jurisdiction. See art. V, § 3(b)(4), Fla. Const.
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Following a trial in 2016, the jury found in favor of
CCM on its breach of contract claim, and it awarded
CCM $551,881 in damages. CCM submitted a proposed
final judgment, requesting $551,881 in damages, and an
additional $84,295.60 in prejudgment interest calculated
by an accountant, with a per diem rate for each day.
This amount included both pre-offer of settlement and
post-offer of settlement interest. The court entered
judgment based on those calculations for a total of
$636,326.90. CCM then moved to tax costs, which the
court granted in the amount of $73,579.21.
CCM moved for attorney’s fees pursuant to section
768.79, Florida Statutes, the offer of judgment statute,
contending that its judgment of $636,326.90, inclusive of
interest, exceeded the offer by more than 25%. Thus,
CCM was entitled to an award of attorney’s fees incurred.
Petri objected, contending that in accordance with White
v. Steak & Ale of Florida, Inc., 816 So. 2d 546 (Fla. 2002),
the amount of the plaintiff’s total recovery included only
its attorney’s fees, costs, and prejudgment interest
accrued up to the date of the offer of judgment. Without
the post-offer prejudgment interest and costs, CCM had
not met the threshold amount of $625,000.
The court granted CCM’s motion for attorney’s fees.
It concluded that White addressed only pre-offer costs in
relation to a plaintiff’s “judgment obtained,” not
prejudgment interest. Relying on Perez v. Circuit City
Stores, Inc., 721 So. 2d 409 (Fla. 3d DCA 1998), the court
ruled that prejudgment interest is included in the
“judgment obtained” for section 768.79 purposes. The
court held a hearing to determine the amount of
attorney’s fees, and the parties ultimately agreed on the
amount, leaving the issue of entitlement for this appeal.
Petri, 271 So. 3d at 1002-03.
On appeal, the Fourth District reversed the award of attorney’s
fees based upon this Court’s precedent, although it concluded that
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the plain meaning of section 768.79 did not support the precedent.
The Fourth District held that this Court’s decisions in White and
Shands Teaching Hospital & Clinics, Inc. v. Mercury Insurance Co. of
Florida, 97 So. 3d 204 (Fla. 2012), required the exclusion of post-
offer prejudgment interest from the “judgment obtained” when
determining entitlement to attorney’s fees pursuant to section
768.79. The Fourth District explained that its conclusion, that only
pre-offer prejudgment interest is included in the calculation,
conflicts with the Third District’s decision in Perez and the First
District’s decision in Phillips. Therefore, the Fourth District certified
conflict with Perez and Phillips, both pre-White cases. It also
certified the above question of great public importance.
II. ANALYSIS
CCM argues that the plain meaning of section 768.79 does not
exclude post-offer prejudgment interest from the “judgment
obtained” that is compared to a rejected settlement offer when
determining whether to award attorneys’ fees under the offer of
judgment statute. Petri counters that this Court in White already
held that post-offer prejudgment interest is to be excluded and that
the White formula has been consistently and workably applied and
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reaffirmed for nearly two decades. Because this Court’s precedent
is not clearly erroneous, we decline to recede from the White
formula.
This Court recently explained that “[i]n a case where we are
bound by a higher legal authority—whether it be a constitutional
provision, a statute, or a decision of the Supreme Court—our job is
to apply that law correctly to the case before us.” State v. Poole,
297 So. 3d 487, 507 (Fla. 2020). And “[w]hen we are convinced that
a precedent clearly conflicts with the law we are sworn to uphold,
precedent normally must yield.” Id. “But once we have chosen to
reassess a precedent and have come to the conclusion that it is
clearly erroneous, the proper question becomes whether there is a
valid reason why not to recede from that precedent.” Id. When
determining whether there is a valid reason not to recede, “[t]he
critical consideration ordinarily will be reliance.” Id.Section 768.79(1), Florida Statutes (2014) (emphasis added),
provides that “[i]f a plaintiff files 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
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attorney’s fees incurred from the date of the filing of the demand.”
Similarly, section 768.79(6)(b), Florida Statutes (2014) (emphasis
added), provides that “[i]f 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 expense, and attorney’s fees . . . incurred from the date
the offer was served.” Section 768.79(6), Florida Statutes (2014)
(emphasis added), explains that “judgment obtained” in subsection
(6)(b) “means the amount of the net judgment entered, plus any
postoffer settlement amounts by which the verdict was reduced.”
In White this Court concluded that, in determining whether
attorney’s fees are to be awarded under section 768.79, settlement
offers should be compared to what would be included in judgments
if the judgments were entered on the date of the settlement offers
because these amounts are the ones that are evaluated when
determining the amount of offers and whether to accept offers. See
816 So. 2d at 550-51. This Court in White reasoned as follows:
In determining both the amount of the offer and whether
to accept the offer, the party necessarily must evaluate
not only the amount of the potential jury verdict, but also
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any taxable costs, attorneys’ fees, and prejudgment
interest to which the party would be entitled if the trial
court entered the judgment at the time of the offer or
demand. As we stated in Danis Industries Corp. v.
Ground Improvement Techniques, Inc., 645 So. 2d 420,
421–22 (Fla. 1994):
[A]ny offer of settlement shall be construed to
include all damages, attorney fees, taxable
costs, and prejudgment interest which would
be included in a final judgment if the final
judgment was entered on the date of the offer
of settlement.
Id. at 421–22. We reaffirmed this principle in our recent
decision in Scottsdale Insurance. Co. v. DeSalvo, 748 So.
2d 941, 944 n.3 (Fla. 1999), where we explained that the
plaintiff’s “recovery” must be added to its “attorney fees,
costs, and prejudgment interest” accrued up to the date
of the “offer” to determine the total “judgment.” It is this
judgment to which the offer must be compared in
determining whether to award fees and costs. Id.In summary, we conclude that the “judgment
obtained” pursuant to section 768.79 includes the net
judgment for damages and any attorneys’ fees and
taxable costs that could have been included in a final
judgment if such final judgment was entered on the date
of the offer. Thus, in calculating the “judgment obtained”
for purposes of determining whether the party who made
the offer is entitled to attorneys’ fees, the court must
determine the total net judgment, which includes the
plaintiff’s taxable costs up to the date of the offer and,
where applicable, the plaintiff’s attorneys’ fees up to the
date of the offer.
Id. (footnotes omitted).
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Then, in State Farm Mutual Automobile Insurance Co. v.
Nichols, 932 So. 2d 1067, 1074 (Fla. 2006), this Court reaffirmed
the White formula, which we described as follows:
In White v. Steak & Ale of Florida, Inc., 816 So. 2d 546(Fla. 2002), we held that the term “judgment” under the
offer of judgment statute must be defined—as it is under
section 627.428—to include not only the plaintiff’s
damages award, but also any attorney’s fees, taxable
costs, and prejudgment interest to which the plaintiff
would have been entitled when the offer was made. Id. at
551. “It is this judgment to which the offer must be
compared in determining whether to award fees and
costs” under both the offer of judgment statute and
section 627.428. Id. (citing DeSalvo, 748 So. 2d at 944
n.3).
Additionally, in Shands, 97 So. 3d at 213, this Court held that a
trial court properly calculated the “judgment obtained” as including
pre-offer prejudgment interest pursuant to the White formula.
Following the formula that this Court first set forth in White,
the district courts have consistently excluded amounts that were
not present on the date of the offer, including damages for claims
that had not yet been added. See Palmentere Bros. Cartage Serv. v.
Copeland, 277 So. 3d 729, 733 (Fla. 1st DCA 2019) (“Because
punitive damages were not part of the case on the date of the offer
of settlement, the calculation of the ‘net judgment’ and ‘judgment
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obtained’ required in section 768.79(6)(b), could not include the
amount of the punitive damages verdict.”); R.J. Reynolds Tobacco
Co. v. Lewis, 275 So. 3d 747, 749 (Fla. 5th DCA 2019) (explaining
that “it is clear that under White, a court may only properly
consider those costs that were already taxable on the date the PFS
was filed,” and holding that the experts’ costs were not taxable
because they had not been deposed and did not testify); Diecidue v.
Lewis, 223 So. 3d 1015, 1017 n.2 (Fla. 2d DCA 2017) (“The majority
of this cost award was not considered when calculating the
necessary twenty-five percent margin in section 768.79(1) because
the costs were not incurred on [the date of the offer].”); UCF
Athletics Ass’n v. Plancher, 121 So. 3d 616, 618-19 (Fla. 5th DCA
2013) (explaining that “[f]or the purpose of the offer of judgment
statute, the judgment obtained includes the net judgment for
damages and any attorney’s fees and taxable costs that could have
been included in a final judgment if such final judgment was
entered on the day of the offer,” and reversing the award of
attorneys’ fees because “[h]ad the trial court properly ruled [on the
issue of sovereign immunity], on the day the offer was made, the
most Appellee would have been entitled to recover from UCFAA was
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$200,000, an amount much less than the offer Appellee made to
settle the case”); Nilo v. Fugate, 30 So. 3d 623, 625 (Fla. 1st DCA
2010) (“Only those costs incurred pre-demand may be considered in
determining whether the total judgment meets the statutory
threshold.”); Segundo v. Reid, 20 So. 3d 933, 938 (Fla. 3d DCA
2009) (“[T]o require the defendant to pay attorney’s fees as a
sanction for ‘unreasonably’ rejecting the plaintiff’s proposal for
settlement would penalize the defendant for damages not pled nor
proven until after the proposal for settlement was rejected and
permit the plaintiff to benefit from the changing nature of his claim
after the proposal for settlement expired.”); Segui v. Margill, 864 So.
2d 518, 518 (Fla. 5th DCA 2004) (“[White] do[es] not support the
award of attorney’s fees in the instant case because no attorney’s
fees had accrued as of the date of the offer of settlement.”); Amador
v. Walker, 862 So. 2d 729, 731 (Fla. 5th DCA 2003) (rejecting the
argument that “[t]he lesson and holding of White is that all taxable
costs, pre-offer and post-offer, are to be included in determining the
‘judgment obtained’ ”).
In fact, as Petri notes, CCM does not cite a decision after White
that stands for the proposition that post-offer prejudgment interest
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is included in the “judgment obtained.” Even the two decisions with
which the Fourth District certified conflict are pre-White decisions.
See Petri, 271 So. 3d at 1007 (certifying conflict with Perez, which
was decided by the Third District in 1998, and Phillips, which was
decided by the First District in 1991). Moreover, as Petri argued
during oral argument, the White formula appears somewhat
uniquely clear and consistently applied in Florida’s related
jurisprudence.
When considering the text of section 768.79 as a whole and in
context, we cannot conclude that this Court’s precedent setting
forth the White formula is “clearly erroneous.” Poole, 297 So. 3d at
507. We simply do not have a definite and firm conviction that this
Court’s prior interpretation of the offer of judgment statute and the
terms “judgment,” “judgment obtained,” and “net judgment entered”
is wrong. Cf. United States v. U.S. Gypsum Co., 333 U.S. 364, 395
(1948) (“A finding [in an action tried without a jury] is ‘clearly
erroneous’ when although there is evidence to support it, the
reviewing court on the entire evidence is left with the definite and
firm conviction that a mistake has been committed.”); Branch v.
Sec’y, Fla. Dep’t of Corr., 638 F.3d 1353, 1356 (11th Cir. 2011) (“A
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finding is clearly erroneous when we are left with the definite and
firm conviction that it is wrong.”); Tropical Jewelers Inc. v. Bank of
Am., N.A., 19 So. 3d 424, 426 (Fla. 3d DCA 2009) (same).
CCM claims that the language of section 768.79(6) defining
“judgment obtained” as the “net judgment entered,” means that all
amounts awarded in any judgment in the case are to be used for
comparison to the offer, including all prejudgment interest, all
costs, and all attorney’s fees. However, the term “net judgment
entered” does not automatically include attorney’s fees, interest, or
costs. Further, section 768.79(2) provides that “[t]he offer shall be
construed as including all damages which may be awarded in a
final judgment.” Attorney’s fees and costs are not damages. See
First Specialty Ins. Co. v. Caliber One Indem. Co., 988 So. 2d 708,
714 (Fla. 2d DCA 2008); Golub v. Golub, 336 So. 2d 693, 694 (Fla.
2d DCA 1976). It was only by interpreting the phrase “net
judgment entered,” which is not defined in the statute, that this
Court determined that pre-offer attorneys’ fees, pre-offer costs, and
pre-offer prejudgment interest should be included in the “judgment
obtained.”
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Accordingly, because we cannot conclude that this Court’s
prior interpretation of section 768.79 is clearly erroneous, we
decline to recede from the formula this Court set forth in White.
See Poole, 297 So. 3d at 507.
III. CONCLUSION
Based upon this Court’s precedent from which we decline to
recede, we hold that post-offer prejudgment interest is excluded
from the “judgment obtained” that is compared to a rejected
settlement offer when determining entitlement to attorneys’ fees
under section 768.79. Accordingly, we answer the certified
question in the affirmative, approve the Fourth District’s decision in
Petri, and disapprove the Third District’s decision in Perez and the
First District’s decision in Phillips to the extent they are
inconsistent with this decision.
It is so ordered.
LABARGA, MUÑIZ, COURIEL, and GROSSHANS, JJ., concur.
CANADY, C.J., dissents with an opinion, in which LAWSON, J.,
concurs.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION
AND, IF FILED, DETERMINED.
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CANADY, C.J., dissenting.
The majority rest its decision on the conclusion that the
question presented is settled by our precedents and there is not an
adequate basis for disturbing those precedents. But as the Fourth
District correctly acknowledged, this Court “has never squarely
addressed [the] issue” presented for decision here. Petri Positive
Pest Control, Inc. v. CCM Condo. Ass’n, 271 So. 3d 1001, 1002 (Fla.
4th DCA 2019). Because we have no applicable precedent and the
result reached by the majority is detached from the text of the
statute, I dissent. I would conclude that post-offer prejudgment
interest must be included in calculating the “judgment obtained”
under section 768.79, answer the certified question in the negative,
and quash the decision on review.
“Not all text within a judicial decision serves as precedent.
That’s a role generally reserved only for holdings: the parts of a
decision that focus on the legal questions actually presented to and
decided by the court.” Bryan A. Garner et al., The Law of Judicial
Precedent 44 (2016). “A decision’s authority as precedent is limited
to the points of law raised by the record, considered by the court,
and determined by the outcome. The assumptions a court uses to
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reach a particular result do not themselves create a new precedent
or strengthen existing precedent.” Id. at 84.
Here, the primary authority on which the majority relies, White
v. Steak & Ale of Florida, Inc., 816 So. 2d 546 (Fla. 2002), stated
that the “question presented” was “whether a prevailing party’s pre-
offer taxable costs are included for purposes of calculating the
‘judgment obtained.’ ” Id. at 549 (emphasis added). The framing of
the issue by the petitioner and the Court in White left aside the
issue of post-offer taxable costs. So the Court had no occasion to
decide whether post-offer taxable costs—much less post-offer
prejudgment interest—should be included in the calculation of the
amount of the judgment obtained. Of course, in White any
argument over post-offer costs would have been meaningless, since
the 25%-of-offer threshold was crossed once pre-offer costs were
included in the calculation of the judgment obtained. In White, the
holding of the Court turned on its rejection of decisions that had
excluded all costs from the calculation of the judgment obtained.
Id. at 550. The Court reasoned that costs were properly considered
in “determining the judgment threshold because a prevailing party
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is entitled to a judgment for taxable costs.” Id. That resolved the
issue presented to the Court for decision in White.
What White went on to say about costs, fees and interest “to
which the party would be entitled if the trial court entered the
judgment at the time of the offer or demand,” id., was not necessary
to decide the issue presented. See id. at 550-51. Indeed, the issue
presented effectively assumed at least that post-offer costs would
not be included in the calculation of the judgment obtained. But
such an assumption that is not necessary to the resolution of the
issue actually presented is not transformed into a holding even if
the court adopts the assumption.
The majority’s reliance on Shands Teaching Hospital & Clinics,
Inc. v. Mercury Insurance Co. of Florida, 97 So. 3d 204 (Fla. 2012), is
similarly misplaced. There is no indication in the Shands opinion
that any argument was presented to the Court regarding post-offer
costs and post-offer prejudgment interest. In any event, the award
of fees sought under section 768.79 was defeated without any need
to consider post-offer costs or post-offer prejudgment interest. See
id. at 214. So—just as in White—that issue was irrelevant to the
disposition of the section 768.79 issue in the case.
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In State Farm Mutual Automobile Insurance Co. v. Nichols, 932
So. 2d 1067, 1074 (Fla. 2006), the Court did refer to the pre-offer
language of White in providing background, but the reference had
no bearing on the issues actually presented and decided. Nichols
held “that the offer of judgment statute applies to PIP suits” but
that the offer at issue was invalid because it “was too ambiguous.”
Id. at 1080. Given the invalidity of the offer, there was no need for
the Court to consider the question presented in this case or any
other question concerning the calculation of the judgment obtained.
Nichols by no means established or reaffirmed any precedent
relevant to the issue in this case.
A fair reading of the text of the statute cannot support the
interpretation articulated in the statements from White relied on by
the majority. As the Fourth District explains, the authorities cited
in White to support its discussion that is relevant to post-offer fees,
costs and interest are cases interpreting a different statute, section
627.428, Florida Statutes, which provides for the award of
prevailing party fees to an insured in litigation against an insurer.
That statute is structured in an entirely different manner than
section 768.79. There is no relevant textual similarity and thus no
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basis for applying the interpretation of one statute to the other
statute. The pertinent statements from White thus are of very
dubious provenance. In issuing those statements, the White
opinion simply did not engage the relevant provisions of section
768.79.
There is no path from the statutory language of section
768.79—“net judgment entered”—to the meaning adopted by the
majority—a hypothetical judgment equivalent to “what would be
included in judgments if the judgments were entered on the date of
the settlement offers.” Majority op. at 6. The legislature certainly
could have enacted a statute with such a meaning. Indeed, the
legislature has enacted a statute containing a very similar
provision. Section 45.061, Florida Statutes (2020), which applies to
offers of settlement for causes of action that accrued on or before
the effective date of the statute in 1990, contains a provision
defining “the amount of the judgment” as “the total amount of
money damages awarded plus the amount of costs and expenses
reasonably incurred by the plaintiff or counter-plaintiff prior to the
making of the offer.” § 45.061(2)(b), Fla. Stat. So the legislature
certainly knows how to clearly exclude post-offer costs and
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expenses from the definition of the amount of judgment used to
determine whether an award is to be made under an offer of
judgment statute.
In previously rejecting particular statutory interpretations, “we
have pointed to language in other statutes to show that the
Legislature ‘knows how to’ accomplish what it has omitted in the
statute in question.” Cason v. Fla. Dep’t of Mgmt. Servs., 944 So. 2d
306, 315 (Fla. 2006). “[W]here the legislature has inserted a
provision in only one of two statutes that deal with closely related
subject matter, it is reasonable to infer that the failure to include
that provision in the other statute was deliberate rather than
inadvertent.” Olmstead v. F.T.C., 44 So. 3d 76, 82 (Fla. 2010)
(alteration in original) (quoting 2B Norman J. Singer & J.D.
Shambie Singer, Statutes and Statutory Construction § 51:2 (7th ed.
2008)). The omission from section 768.79 of a provision similar to
the pre-offer provision of section 45.061 strongly militates against
the result reached by the majority.
LAWSON, J., concurs.
Application for Review of the Decision of the District Court of Appeal
Certified Great Public Importance/Certified Direct Conflict of
Decisions
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Fourth District - Case No. 4D18-1290
(Broward County)
Steven J. Hammer and Zane Berg of Schlesinger Law Offices, P.A.,
Fort Lauderdale, Florida; Shea T. Moxon, Celene H. Humphries, and
Joseph T. Eagleton of Brannock, Humphries & Berman, Tampa,
Florida; and Thomas P. Angelo and James W. Carpenter of Angelo &
Banta, P.A., Fort Lauderdale, Florida,
for Petitioners
Mark D. Tinker, Tampa, Florida, and Sanaz Alempour of Cole, Scott
& Kissane, P.A., Fort Lauderdale, Florida,
for Respondents
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