MICHAEL L. GRAY, ET AL., APPELLANTS,
v.
MICHAEL O'SHAUGHNESSY, INC., APPELLEE
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The Fifth District Court of Appeal reversed the trial court's denial of attorney's fees to the prevailing party (the Grays) in a real estate brokerage dispute. Although the trial court correctly found no binding second listing agreement existed, it erred in denying fees under the original listing agreement's prevailing party attorney's fees clause.
Yes. The Grays, as the prevailing party, are entitled to recover reasonable attorney's fees and costs under the attorney's fees provision in the original listing agreement, despite the contract's cancellation by mutual agreement. The cancellation does not eliminate the enforceable obligation regarding attorney's fees.
[1] A contract that is cancelled by agreement of the parties may still support a claim for attorney's fees under a prevailing party provision contained within the original co…
[2] Litigation arising out of a contract may entitle the prevailing party to attorney's fees even if the contract is later found to be unenforceable or rescinded.
Previewing 2 of 4 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“that when parties enter into a contract and litigation later ensues over that contract, attorney's fees may be recovered under a prevailing-party attorney's fee provision contained therein even though the contract is rescinded or held to be unenforceable.”
Establishes the controlling legal principle that attorney's fees provisions survive contract rescission or unenforceability
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Join FLexlaw to unlock all legal intelligenceMichael O'Shaughnessy, Inc. sued the Grays claiming a real estate brokerage commission based on listing agreements. The trial court found that the ori…
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GOSHORN, Judge.
This appeal arises from a dispute involving a claim for a real estate brokerage commission by Michael O’Shaughnessy, Inc. against the appellants Michael L. Gray and Wendy P. Gray, his wife. Following a non-jury trial, the trial court found that the original real estate listing agreement had been cancelled by agreement of the parties and that no contract was ever agreed upon to replace the original listing. The court entered judgment in favor of the Grays but denied their request for attorney’s fees, finding that:
It is evident that this litigation arose because of the absence of an agreement, written or otherwise. Hence, it is my conclusion that no attorney’s fees should be awarded in this case. [Emphasis added],
The court apparently made this determination based upon testimony regarding the existence, vel non, of a second and subsequent listing agreement between the parties. As to this alleged second listing contract, the court found that it had never been agreed upon. We agree that a contract which never came into existence cannot form the underpinning for a claim of contractual entitlement to attorney’s fees.
However, a review of the record reveals that the complaint filed by O’Shaughnessy based its claim on the original exclusive right of sale listing agreement. That contract contains the following provision:
7. In the event any litigation arises out of this Contract, the prevailing party shall be entitled to recover reasonable attorney’s fees and costs.
Therefore, it was error not to consider the Grays’ claim for reasonable attorney’s fees and costs, as they are the prevailing party under the contract sued upon.
In Katz v. Van Der Noord, 546 So. 2d 1047, 1049 (Fla.1989) the supreme court held
that when parties enter into a contract and litigation later ensues over that contract, attorney’s fees may be recovered under a prevailing-party attorney’s fee provision contained therein even though the contract is rescinded or held to be unenforceable.
This principle is no less true when the contract is found to be cancelled by the agreement of the parties. The cancellation does not erase the fact that valid enforceable obligations regarding responsibility for attorney’s fees and costs in the event of litigation under the contract exist between the parties.
Accordingly, that portion of the final judgment finding that the Grays were not entitled to an award of attorney’s fees is reversed and this cause is remanded with instructions to the trial court to award reasonable costs and attorney’s fees to the appellants.
AFFIRMED in part; REVERSED in part; REMANDED with instructions.
COWART and HARRIS, JJ., concur.
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Remarc Homes, Inc. v. Bernadette Kumar & The Principal Fin. Grp., Inc., 616 So. 2d 498 (Fla. 5th DCA 1993)…v. Combs, 555 So. 2d 1313 (Fla. 5th DCA 1990); Golden Cleaver Packing, Inc. v. G & M Hughes Corp., 490 So. 2d 1381, 1383 n. 3 (Fla. 5th DCA 1986). See also Moritz v. Hoyt Enters., Inc., 604 So. 2d 807 (Fla.1992); Gray v. Michael O’Shaughnessy, Inc., 574 So. 2d 288 (Fla. 5th DCA 1991). Accordingly, the post-judgment order and amended final judgment appealed from are reversed and remanded with directions to the trial court to recompute interest pursuant to Argonaut and to award reasonable attorney’s fees to Re…
Authorities Cited
- Brown v. State, 546 So. 2d 1047 (Fla. 1989)
- Katz v. VAN DER Noord, 546 So. 2d 1047 (Fla. 1989)