Nancy Palmer, n/k/a Nancy Walgis v. Danny Palmer

IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
NANCY PALMER, n/k/a Nancy NOT FINAL UNTIL TIME EXPIRES TO
Walgis, FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
Appellant,
CASE NO. 1D15-3325
v.
DANNY PALMER,
Appellee.
_____________________________/
Opinion filed August 9, 2016.
An appeal from the Circuit Court for Santa Rosa County.
John Miller and David Rimmer, Judges.
Ross A. Keene of Ross Keene Law, P.A., Pensacola, for Appellant.
Kim Anthony Skievaski of Kim Anthony Skievaski, PA, Pensacola, for Appellee.
WOLF, J.
This is an appeal from an order granting attorney’s fees to the former wife in
a dissolution proceeding. The issue is whether a trial court that has determined to
award attorney’s fees to the wife based on a significant disparity in non-marital
assets may deny fees accrued after the former wife’s rejection of a settlement offer.
The denial was based solely on the trial court’s determination that the rejection of
the settlement offer was unreasonable. In Aue v. Aue, 685 So. 2d 1388 (Fla. 1st
DCA 1997), we determined “there is no authority for denying attorney’s fees in
dissolution cases solely for the failure to accept an offer of settlement.” Because
we determine Aue is applicable in this case, we reverse.
The former husband filed a petition for dissolution of marriage on May 13,
2011, in which he alleged the marriage was a short-term marriage that had lasted
approximately 5.5 years – from November 10, 2005, through May 6, 2011.
The couple had limited income and marital assets. The former wife,
however, had $180,000 in non-marital assets while the former husband had non-
marital assets of $800,000. The trial judge awarded the former wife $10,000 in
lump-sum bridge-the-gap alimony and noted that he felt constrained from
awarding her more both because of the short length of the marriage, and because to
award her more, he would have to dip into the former husband’s non-marital IRA
account. The trial court also indicated that the former husband would be
responsible for the former wife’s reasonable attorney’s fees and reserved
jurisdiction to later determine the amount of fees and manner of payment. Orally,
the trial court noted it would be unfair not to award the former wife fees: “The
attorney fees clearly – with a significant disparity in the non-marital assets of the
parties, it would be reversible error for me not to award attorney fees and costs to
the wife. I will do that.”
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The former wife moved for a hearing to determine the amount of attorney’s
fees and costs. During the hearing, counsel for the former wife stated she was
requesting $27,019.25 in attorney’s fees. Counsel for the former husband claimed
the case was overly litigated as a result of the former wife’s position regarding
alimony, and her awarded attorney’s fees should be diminished because of her
unreasonable rejection of a settlement offer of $25,000.
There was extensive testimony concerning settlement negotiations and the
input the former wife had concerning settlement without objections by either
party. 1 In his final order on the former wife’s motion for attorney’s fees, the judge
found the former husband should be responsible for $11,389.50 of the former
wife’s attorney’s fees. This did not include the attorney’s fees accrued after the
former wife rejected the January 11, 2013, offer by the former husband because
“the Court finds that the evidence is clear that the Former Wife is responsible for
rejecting the reasonable offer and as a result unnecessarily incurred the fees of
attorney Jill Warren.” The trial court noted the former wife unreasonably rejected
the offer in part because “[s]he ultimately received much less after trial.” The trial
court did not indicate its consideration of any other relevant factors to support its
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The former wife introduced this testimony indicating she was merely following
her attorney’s advice and, therefore, her attorney’s fees should not be reduced. It is
unclear that this testimony would be relevant or proper regarding the issue of
results obtained versus the amount offered in settlement. We do not reach the
admissibility issue.
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limitation of the attorney’s fees awarded to the former wife. As such, the former
wife was left with $15,629.75 in attorney’s fees that she herself was responsible for
solely because of her rejection of the former husband’s settlement offer.
Section 61.16, Florida Statutes (2011), states in pertinent part:
The court may from time to time, after considering the financial
resources of both parties, order a party to pay a reasonable amount for
attorney’s fees . . . .
In Rosen v. Rosen, 696 So. 2d 697, 700 (Fla. 1997), the Florida Supreme
Court interpreted this section to mean that a trial court may consider relevant
circumstances of an individual case, but “the financial resources of the parties are
the primary factor to be considered.” The court went on to say other relevant
circumstances to be considered are:
[T]he scope and history of the litigation; the duration of the litigation;
the merits of the respective positions; whether the litigation is brought
or maintained primarily to harass (or whether a defense is raised
mainly to frustrate or stall); and the existence and course of prior or
pending litigation.
Id.
In Aue, 685 So. 2d at 1388, we reviewed a trial court’s order denying
attorney’s fees pursuant to this statutory section where “its decision was not based
upon the parties’ earnings, but on its finding that the former wife was
‘unreasonable’ in declining the former husband’s support offer.” We specifically
stated that while there may be special circumstances to consider in addition to the
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parties’ financial positions when determining entitlement to attorney’s fees, no
authority existed for denying fees solely based on the failure to accept an offer of
settlement. Id.
The Second District in Levy v. Levy, 900 So. 2d 737, 748 (Fla. 2d DCA
2005), cited our Aue decision with approval and stated,
Although trial courts have the authority pursuant to section 61.16 to
deny fees for various forms of litigation misconduct in proceedings
for dissolution of marriage, “there is no authority for denying
attorney’s fees in dissolution cases solely for the failure to accept an
offer of settlement.”
900 So. 2d at 748 (quoting Aue, 685 So. 2d at 1388) (emphasis added).
The Fourth District, however, in Hallac v. Hallac, 88 So. 3d 253, 256 (Fla.
4th DCA 2012), held that fees to a spouse who has demonstrated financial need
may be limited based on the failure to accept a settlement offer which “was
significantly better than anything she could have received at trial.” See also Diaz v.
Diaz, 727 So. 2d 954 (Fla. 3d DCA 1998), quashed on other grounds by 826 So. 2d
229 (Fla. 2002). The court held rejection of a settlement offer by itself was
sufficient to limit fees, even where the trial judge had noted “that she didn’t think
that the case had been over-litigated on either side.” Hallac, 88 So. 3d at 256.
The Fourth District in Hallac distinguished our holding in Aue based on two
considerations: 1) in Aue there had been a denial of all fees rather than just a denial
of those incurred after the settlement offer; and 2) that Rosen, which was decided
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by the supreme court after Aue, contemplated a reduction in fees based on the
unreasonable rejection of a settlement offer. Hallac, 88 So. 3d at 257-58.
The Fourth District’s attempt in Hallac to distinguish our holding in Aue (on
the basis that there was not a denial of all fees) is inconsistent with our holding that
there was no statutory authority to limit the fees to a needy spouse based solely on
the rejection of an offer of settlement.
We also do not read Rosen to adopt a general rule that effectively provides
that rejections of offers to settle may be the sole reason for limiting fees in all
family law cases. Offers of judgment are not specifically mentioned in Rosen. The
holding in Rosen is that the financial resources of the parties is the primary
consideration for the award of attorney’s fees in dissolution cases, but after
considering all the circumstances surrounding the suit, the court may exercise its
inherent powers and deny fees in order to provide justice and ensure equity
between the parties. Rosen, 696 So. 2d at 699.
In fact, the factors for consideration mentioned in Rosen related to the
overall method by which the litigation was handled. The court recognized that a
review of the entire course of the litigation and special circumstances may require
equity to override financial considerations. Isolated consideration of settlement
offers was not contemplated. Emphasis on offers of settlement which are not
proscribed and authorized by statute is also problematic because of the potential
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involvement of the court in information related to settlement offers, attorney client
privilege, and other confidential items. 2
In reaching the decision, we are not unmindful of the policy considerations
raised by Judge Polen in his concurrence in Oldham v. Oldham 683 So. 2d 579,
581 (Fla. 4th DCA 1996). He argued that there is a need to bring economic sanity
to dissolution litigation and that there should be “some economic incentive on the
non-fee paying spouse to critically and realistically evaluate settlement offers.” Id.
While we do not disagree with these sentiments, the issue of attorney’s fees in
family cases is complicated. Economic sanity needs to be balanced against the
needs of the spouse with less financial ability to obtain competent counsel. The
items which may be considered by the trial court must specially be addressed.
Unbridled discretion to review settlement offers and motivations without guidance,
like what occurred in this case, is unworkable. We, therefore, declare conflict with
Hallac to the extent that it determines that rejection of a settlement offer may be
the sole basis for overriding a determination of an award of financial need in
denying attorney’s fees accrued after the rejection.
Essentially the trial judge in this case, much like the court in Hallac, applied
a portion of the offer of judgment statutes to dissolution proceedings. This should
2
Neither section 45.061(4), Florida Statutes, the statute entitled “Offers of
Settlement,” nor section 768.79, Florida Statutes, the statute regarding offers and
demands of judgment in civil actions for damages, applies in dissolution of
marriage proceedings.
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be a legislative decision. The court should only exercise the power to reduce fees
when it would be inequitable not to do so after a review of all circumstances.
We, therefore, REVERSE the order on attorney’s fees and REMAND to the
trial court to readdress fees evaluating all pertinent considerations and not just the
rejection of the settlement offer.
ROBERTS, C.J., and B.L. THOMAS, J., CONCUR.
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