GILTEX CORPORATION, A DELAWARE CORPORATION, APPELLANT/CROSS-APPELLEE,
v.
RAYMOND DIEHL, JR., APPELLEE/CROSS-APPELLANT
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The court held that a contract existed and became unenforceable due to an unmet contingency, entitling the prevailing party to attorney fees. The court affirmed the return of the deposit but reversed the denial of attorney fees.
[1] A contract may exist and bind parties to implied duties during a contingency period, even if the central agreement becomes unenforceable due to an unmet contingency.
[2] A contract provision for attorney fees in litigation arising out of the contract is operative even if the contract's primary purpose becomes unenforceable.
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Join FLexlaw to unlock all legal intelligenceGiltex Corporation (buyer) and Raymond Diehl, Jr. (seller) entered into a contract for commercial property, contingent upon Giltex purchasing adjacent…
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BARFIELD, Judge.
In this appeal and cross appeal from a final judgment on a complaint for inter-pleader, we affirm the trial court’s order directing return of appellant’s deposit, but reverse the trial court’s denial of appellant’s request for attorney fees, which was grounded on its finding that the contract for the sale of commercial property “never became effective.” We find no merit in the cross appeal.
Two of the clauses added to the printed contract between the seller (Raymond Diehl, Jr., appellee) and the buyer (Giltex Corporation, appellant) are pertinent to this dispute:
This contract is contingent upon Buyers (sic) purchase of land adjacent and to the west of the subject property, which in turn is contingent upon successful rezoning to allow parking.
This Contract is Contingent upon buyer Consummating a Contract with Adjacent property owner within 5 working days from date of acceptance of this Contract.
The parties agreed to buy and sell the subject commercial property, but only if Giltex succeeded in consummating a contract to buy the adjoining property (for needed additional parking) within five working days of the execution of the contract between Giltex and Diehl. Implied in this contract was a promise by Giltex to make a diligent effort to consummate the contract with the owner of the adjacent property (Wheeler) within the five day contingency period, and a mutual promise by Diehl not to sell the property to someone else during that period. After the contingency period elapsed, the parties were no longer bound to these implied promises, nor were they bound to consummate the sale of Diehl’s property.
The record supports the trial court’s findings that there was no evidence demonstrating lack of diligence by Giltex during the five working day contingency period and that the evidence was insufficient to support Diehl’s claim that he had waived the five day contingency clause. The record also supports the trial court’s conclusion that the deposit should be returned to Giltex, but it does not support the trial court’s basis for that conclusion, its finding that the contract “never had life breathed into it and the parties were never contractually bound by it.”
This case is distinguishable from Gibson v. Courtois, 539 So. 2d 459 (Fla.1989), and Leitman v. Boone, 439 So. 2d 318 (Fla. 3d DCA 1983), in each of which the court found that the contract never came into being because a basic element never existed and that the parties were therefore never bound by any of its provisions.1 Here', it is clear from the evidence presented that the parties mutually agreed to all the terms of the written contract, gave mutual consideration and were mutually bound, at least during the contingency period, to duties implied by it. Contrary to the trial court’s finding, this contract (including the agreement that the prevailing party would be entitled to recover all costs incurred in connection with any litigation arising out of it) did come into existence, notwithstanding that its central agreement (to buy and sell Diehl’s property) became unenforceable because, through no fault of either party, a contingency to which they had agreed did not occur (consummation, within five days of execution of the Giltex/Diehl contract, of a contract between Giltex and Wheeler for purchase of the adjoining property). Litigation to recover the deposit which Giltex had placed in escrow “arose out of” this contract, and Giltex, as the prevailing party, is therefore entitled to recover from Diehl all costs connected with the litigation, including attorney fees at trial and on appeal.
AFFIRMED in part, REVERSED in part, and REMANDED for correction of the final judgment and determination of reasonable attorney fees.
NIMMONS and MINER, JJ., concur. . In Leitman, the court ruled that competent substantial evidence supported the trial court's finding that no contract was ever formed because the offer made by the plaintiffs was never accepted, and that because there was "no contract at all,” as opposed to "a contract that is unenforceable,” the prevailing party could not be entitled to fees “arising out of’ the non-existent contract. 439 So. 2d at 320-21. Leitman distinguished Sousa v. Palumbo, 426 So. 2d 1072 (Fla. 4th DCA 1983), in which the court had authorized an attorney fee award, on the ground that in that case "there is little question that a contract between the plaintiff and the three defendant stockholders existed, but the contract was by its terms unenforceable until the remaining three stockholders signed.” Id. The court pointed out that where enforcement of a contract is prevented, "since a contract exists, even though later declared to be void or voidable, certain of its provisions may be operative.” Id.
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Katz v. VAN DER Noord, 546 So. 2d 1047 (Fla. 1989)…A 1983). In the interim, we disapproved Sousa to the extent that it conflicted with our opinion in Gibson v. Courtois, 539 So. 2d 469 (Fla.1989). More recently, however, the First District Court of Appeal issued its opinion in Giltex Corp. v. Diehl, 544 So. 2d 302 (Fla. 1st DCA 1989), which also conflicts with the decision below. We have jurisdiction. Art. V, § 3(b)(3), Fla. Const. This suit originated out of a contract for the purchase of a mobile home park. In the contract dated April 15, 1986, the sellers…1 / 2
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Giltex Corp. v. Diehl, 583 So. 2d 734 (Fla. 1st DCA 1991)…is whether he is or is not entitled to a greater or additional sum. McMullen, 146 So. at 569 (Fla.1933). REVERSED and REMANDED for further proceedings consistent with this opinion. JOANOS, C.J., and BARFIELD, J., concur. . Giltex Corp. v. Diehl, 544 So. 2d 302 (Fla. 1st DCA 1989).…
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Surgical P'rs, LLC v. Michael Choi, D.O., 100 So. 3d 1267 (Fla. 4th DCA 2012)…and the case to the trial court to vacate the attorney’s fees award.2 Reversed and Remanded to Vacate the Attorney’s Fees Award. STEVENSON and LEVINE, JJ„ concur. . We find Katz v. Van Der Noord, 546 So. 2d 1047 (Fla.1989); Giltex Corp. v. Diehl, 544 So. 2d 302 (Fla. 1st DCA 1989); and Tarr v. Honea, 959 So. 2d 780 (Fla. 4th DCA 2007) unpersuasive to the doctor’s position. . We note that the judgment lumps attorney's fees and costs together. Upon remand, the trial court should vacate only the attorney’s f…
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Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Gibson v. Garth Courtois and Sally Courtois, 539 So. 2d 459 (Fla. 1989)
- Lorn Leitman and John Gentile v. Boone, 439 So. 2d 318 (Fla. 3d DCA 1983)
- Sousa v. Palumbo, 426 So. 2d 1072 (Fla. 4th DCA 1983)