GARY I. MANHEIMER v. FLORIDA POWER & LIGHT COMPANY, etc.

Third District Court of Appeal
State of Florida
Opinion filed August 2, 2023.
Not final until disposition of timely filed motion for rehearing.
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No. 3D22-1534
Lower Tribunal No. 16-21186
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Gary I. Manheimer,
Appellant,
vs.
Florida Power & Light Company, etc.,
Appellee.
An Appeal from a non-final order from the Circuit Court for Miami-Dade
County, Antonio Arzola, Judge.
Egozi & Bennett, P.A., Bernard L. Egozi and Joshua S. Olin, for
appellant.
Gunster, Yoakley & Stewart, P.A., Michael B. Green and Lauren V.
Purdy, for appellee.
Before SCALES, LINDSEY and GORDO, JJ.
GORDO, J.
Gary I. Manheimer appeals an order denying his motion for leave to
amend his complaint to add a claim for punitive damages. We have
jurisdiction. Fla. R. App. P. 9.130(a)(3)(G). Because Manheimer failed to
make a reasonable showing through record evidence that Florida Power &
Light Company (“FPL”) engaged in intentional misconduct or gross
negligence, as required pursuant to the plain language of section 768.72,
Florida Statutes, we affirm.
FACTUAL AND PROCEDURAL BACKGROUND
In October 1999, FPL obtained an easement to install an underground
powerline on the eastern property line of 1431 W. 24th Street, Miami Beach,
Florida (“1431 Property”). The powerline was installed via boring technology.
Manheimer purchased the property next door to the 1431 Property in July
2003 via warranty deed.
On April 28, 2016, contractors digging up the street in front of
Manheimer’s property accidentally struck an underground powerline.
Because of this incident, the powerline was tripped, and FPL received a
digital notification that the powerline was “off line”—meaning it might not be
where it was supposed to be. After an initial investigation into the incident,
FPL learned the powerline might be on or near Manheimer’s property. The
exact location of the powerline, however, remained unclear. After
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Manheimer received notice the powerline was potentially on his property, he
demanded FPL immediately remove it. Because no survey of the property
had been conducted, neither party was aware of the exact location of the
powerline or even if it was necessarily on Manheimer’s property.
On August 15, 2016, Manheimer filed a complaint against FPL for
ejectment and declaratory judgment. FPL timely filed an answer and
affirmative defenses including its rights to possession of the property as a
public utility with condemnation authority. Three years later, Manheimer filed
an amended complaint adding a claim for unjust enrichment. FPL responded
with another answer and affirmative defenses, now additionally asserting its
eminent domain authority pursuant to section 361.01, Florida Statutes, as a
regulated public utility and noting the sole remedy Manheimer was entitled
to was compensation. While the litigation was ongoing, Manheimer
demolished his existing home and built another on the property. As a remedy
for his allegations, Manheimer sought removal of the powerline as well as
approximately $27 million in damages based solely on the powerline’s
encroachment on his property.
Between the first complaint and amended complaint, FPL conducted
an investigation and survey of Manheimer’s property regarding the location
of the powerline. FPL discovered that unbeknownst to its workers, the bore
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shifted during the installation process causing the powerline to mistakenly
enter Manheimer’s property. The powerline was found to be located 2.3 feet
onto Manheimer’s property at its furthest encroachment point and was buried
between fifteen and forty feet below the ground.
In May 2022, Manheimer filed a motion for leave to amend his
complaint to add a claim for punitive damages pursuant to section 768.72.
The sum of Manheimer’s argument was that once FPL learned of the
trespass in April 2016, its decision not to remove the powerline from
Manheimer’s property was intentional misconduct and gross negligence.
FPL filed a motion in opposition asserting that punitive damages were
unwarranted as there was no evidence FPL intentionally committed trespass
on Manheimer’s property and Manheimer suffered no injury due to the
powerline.
The trial court held a hearing on the motion and later entered an order
denying Manheimer’s motion finding the evidence presented did not
constitute a reasonable showing under section 768.72. This appeal
followed.
STANDARD OF REVIEW
“We review de novo the trial court’s purely legal ruling that plaintiff
made a ‘reasonable showing’ under section 768.72 to recover punitive
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damages.” Cleveland Clinic Florida Health Sys. Nonprofit Corp. v. Oriolo,
357 So. 3d 703, 705 (Fla. 4th DCA 2023) (quoting Holmes v.
Bridgestone/Firestone, Inc., 891 So. 2d 1188, 1191 (Fla. 4th DCA 2005));
see also Grove Isle Ass’n, Inc. v. Lindzon, 350 So. 3d 826, 829 (Fla. 3d DCA
2022).
LEGAL ANALYSIS
“Punitive damages are a form of extraordinary relief for acts and
omissions so egregious as to jeopardize not only the particular plaintiff in the
lawsuit, but the public as a whole, such that a punishment—not merely
compensation—must be imposed to prevent similar conduct in the future.”
BDO Seidman, LLP v. Banco Espirito Santo Int’l, 38 So. 3d 874, 876 (Fla. 3d
DCA 2010). “Under Florida law, the purpose of punitive damages is not to
further compensate the plaintiff, but to punish the defendant for its wrongful
conduct and to deter similar misconduct by it and other actors in the future.”
Owens–Corning Fiberglas Corp. v. Ballard, 749 So. 2d 483, 486 (Fla. 1999).
“[P]unitive damages are reserved for truly culpable behavior and are
intended to ‘express society’s collective outrage.’” KIS Grp., LLC v. Moquin,
263 So. 3d 63, 65–66 (Fla. 4th DCA 2019) (quoting Imperial Majesty Cruise
Line, LLC v. Weitnauer Duty Free, Inc., 987 So. 2d 706, 708 (Fla. 4th DCA
2008)).
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In Florida, section 768.72 authorizes and governs punitive damages.
Pursuant to section 768.72(2), “[a] defendant may be held liable for punitive
damages only if the trier of fact, based on clear and convincing evidence,
finds that the defendant was personally guilty of intentional misconduct or
gross negligence.” Section 768.72(2) defines intentional misconduct and
gross negligence as:
(a) “Intentional misconduct” means that the
defendant had actual knowledge of the wrongfulness
of the conduct and the high probability that injury or
damage to the claimant would result and, despite that
knowledge, intentionally pursued that course of
conduct, resulting in injury or damage.
(b) “Gross negligence” means that the defendant’s
conduct was so reckless or wanting in care that it
constituted a conscious disregard or indifference to
the life, safety, or rights of persons exposed to such
conduct.
§ 768.72(2)(a)-(b), Fla. Stat.
No claim for punitive damages, however, may proceed “unless there is
a reasonable showing by evidence in the record or proffered by the claimant
which would provide a reasonable basis for recovery of such damages.” §
768.72(1), Fla. Stat. A plaintiff is required to make this reasonable showing
because “[f]rom a practical perspective, the granting of a motion for leave to
amend a complaint to add a punitive damages claim can be a ‘game changer’
in litigation. Allowing a plaintiff to proceed with a punitive damages claim
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subjects the defendant to financial discovery that would otherwise be off
limits . . . and potentially subjects the defendant to uninsured losses.” TRG
Desert Inn Venture, Ltd. v. Berezovsky, 194 So. 3d 516, 520 n.5 (Fla. 3d
DCA 2016); see also Est. of Despain v. Avante Grp., Inc., 900 So. 2d 637,
641 (Fla. 5th DCA 2005) (“[A]lthough section 768.72(1) is procedural in
nature, it also provides a substantive right to parties not to be subjected to a
punitive damage claim and attendant discovery of financial worth until the
requisite showing under the statute has been made to the trial court.”). The
importance of financial discovery cannot be overstated. As a result, the
Florida Supreme Court recently amended Florida Rule of Appellate
Procedure 9.130 to authorize appeals of nonfinal orders on motions for leave
to amend to assert a claim for punitive damages. See In re Amend. to Fla.
R. of App. P. 9.130, 345 So. 3d 725, 725–26 (Fla. 2022).
Because punitive damages are meant to be reserved for the most
egregious of cases and have substantial impacts to the parties, section
768.72 “requires the trial court to act as a gatekeeper and preclude[ ] a claim
for punitive damages where there is no reasonable evidentiary basis for
recovery.” Bistline v. Rogers, 215 So. 3d 607, 611 (Fla. 4th DCA 2017). This
means “that the trial court cannot ‘simply accept[ ] the allegations in a
complaint or motion to amend as true.’” Napleton’s N. Palm Auto Park, Inc.
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v. Agosto, 2023 WL 4095777, at *2 (Fla. 4th DCA June 21, 2023) (quoting
Bistline, 215 So. 3d at 610). A trial court must weigh both parties’ showings
when considering whether the evidence or proffer is sufficient to establish a
reasonable evidentiary basis for recovery of punitive damages. See Marder
v. Mueller, 358 So. 3d 1242, 1246 n.1 (Fla. 4th DCA 2023). “A trial court’s
inquiry under section 768.72 is more intensive than at summary judgment
because the statute ‘necessarily requires the court to weigh the evidence
and act as a factfinder.’” Napleton’s, 2023 WL 4095777, at *2 (quoting KIS
Grp., 263 So. 3d at 66).
Here, Manheimer asserts he made a reasonable showing through
evidence that FPL engaged in both intentional misconduct and gross
negligence by failing to remove the powerline from his property after learning
of its encroachment. Review of the undisputed evidence, however, shows
that the shifting of the powerline onto Manheimer’s property was not
intentional and has resulted in no injury to Manheimer other than the alleged
trespass itself. Under Florida law, where the record evidence demonstrates
that a trespass was a mistake, there was no unreasonable delay in
remedying the mistake and no damage resulted to the plaintiff, the trespass
cannot serve as the basis for punitive damages. See Florida Power & Light
Co. v. Walker, 440 So. 2d 659, 660 (Fla. 1st DCA 1983) (“The evidence,
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however, shows only that the trespass was a mistake. Even when viewed in
the light most favorable to appellees, there is nothing in the record to show
that Florida Power & Light or its contractor acted with wantonness, actual
malice, deliberation, gross negligence, or utter disregard of appellees’
property rights.”); Florida Power Corp. v. Scudder, 350 So. 2d 106, 109–10
(Fla. 2d DCA 1977) (“Although mistaken and even careless about
determining the ownership of the lands where it installed its poles and lines,
Florida Power’s conduct was not of a wanton character and was certainly not
the type of outrageous wrong which warrants imposition of punitive
damages.”); Horn v. Corkland Corp., 518 So. 2d 418, 420 (Fla. 2d DCA 1988)
(“Upon review of the facts in this case, we find the evidence clearly supports
the trial judge’s finding that the trespass was committed by mistake and not
by willful and wanton misconduct on the part of the Corkland or Scarborough.
Under such circumstances, this court has held that punitive damages are not
appropriate.”).
Further, while power companies are held to a higher duty of care,
courts have held that punitive damages are only warranted where a company
had knowledge of damage or a dangerous condition and chose not to
remedy it. See McCain v. Florida Power Corp., 593 So. 2d 500, 504 (Fla.
1992) (noting that power companies “must shoulder a greater-than-usual
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duty of care in proportion to the greater-than-usual zone of risk associated
with the business enterprise they have undertaken.”); Otey v. Florida Power
& Light Co., 400 So. 2d 1289, 1291 (Fla. 5th DCA 1981) (finding punitive
damages could be awarded where FPL was notified of and asked to repair
a dangerous condition but did nothing to remedy the condition in the four
years prior to the resulting injury at issue); see also Am. Motors Corp. v. Ellis,
403 So. 2d 459, 468 (Fla. 5th DCA 1981) (“[P]unitive damages have been
allowed where the defendant had knowledge of a defect or dangerous
condition and chose not to remedy the condition.”); Williams v. Florida E.
Coast Ry. Co., 552 So. 2d 279, 281 (Fla. 3d DCA 1989) (reversing the
dismissal of a claim for punitive damages where, on the facts alleged, “the
jury could find the railroad guilty of wanton misconduct in retaining [a certain
employee] with knowledge of [his] accident history and his disdain for human
life or safety, or by their failure to institute procedures and regulations
designed to prevent such accidents”).
Here, the undisputed evidence is that the litigation over the powerline
was initiated almost immediately after both parties learned the powerline was
potentially on Manheimer’s property. Approximately two years of litigation
passed without either party even knowing the powerline’s exact location, or
even if it had improperly encroached on Manheimer’s property. Once FPL
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learned of the improper shifting of the bore during installation, it
acknowledged that Manheimer is entitled to compensation as a remedy for
the trespass on his property caused by the powerline. The fact that FPL
defended itself in a litigation over its potential rights related to the powerline
on Manheimer’s property cannot in and of itself form a basis for the
imposition of punitive damages.
We commend the trial court for properly exercising its gate keeping
function in this case. Pursuant to the plain language of section 768.72, the
legislature enacted the section to require a more rigorous assessment of
punitive damages claims and prevent gamesmanship. See Cat Cay Yacht
Club, Inc. v. Diaz, 264 So. 3d 1071, 1076 (Fla. 3d DCA 2019) (noting that in
section 768.72 “the legislature expressly required a more rigorous
assessment” before allowing a plaintiff to add a claim for punitive damages).
While we recognize unreasonable delay by an intentional trespasser in
removing itself after notification by an owner has in extreme cases been
found sufficient to convert a negligence claim into a punitive damages claim,
that is not the case here. See Kish v. McDonald’s Corp., 564 So. 2d 1177,
1179 (Fla. 4th DCA 1990) (finding that punitive damages were warranted
where the defendant intentionally trespassed onto the plaintiff’s property and
later refused to leave after notification by the owner); Pace Prop. Fin. Auth.,
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Inc. v. Jones, 24 So. 3d 1271, 1272 (Fla. 1st DCA 2009) (noting that punitive
damages were awarded “based on damage the appellants caused to the
appellees’ land, when the appellants repeatedly entered onto the appellees’
property and destroyed trees and other vegetation”).
FPL may have declined to acquiesce to Manheimer’s demand it
remove the powerline from his property, but the trial court correctly found
FPL did so in the first instance because it was uncertain of the powerline’s
location and afterwards because of the parties’ relative rights currently being
litigated in the underlying claims. FPL correctly points out that there is no
evidence in the record of any defect, dangerous condition or damage that
resulted from the powerline’s existence—forty-feet below ground and two-
feet onto Manheimer’s property. The powerline Manheimer wishes to
remove, however, currently provides electricity to more than one hundred
homes in the area. The Florida Supreme Court has held that “[t]he conduct
required to allege punitive conduct reaches beyond simple negligence.”
Valladares v. Bank of Am. Corp., 197 So. 3d 1, 11 (Fla. 2016). “[P]unitive
damages are [only] appropriate when a defendant engages in conduct which
is fraudulent, malicious, deliberately violent or oppressive, or committed with
such gross negligence as to indicate a wanton disregard for the rights and
safety of others.” Owens-Corning Fiberglas Corp., 749 So. 2d at 486; see
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also U.S. Concrete Pipe Co. v. Bould, 437 So. 2d 1061, 1064 (Fla. 1983)
(“Punitive damages cannot be assessed for mere negligent conduct, but
must be based on behavior which indicates a wanton disregard for the rights
of others.”).
While the installation process may have gone awry and caused the
powerline to shift unbeknownst to FPL’s workers, there is nothing in the
record to show that FPL acted with the requisite intentional misconduct or
gross negligence by failing to remove the powerline while litigation was
ongoing. Considering the absence of such evidence in the record, it is
apparent a claim for punitive damages does not lie.
Affirmed.
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