REMARC HOMES, INC., APPELLANT,
v.
BERNADETTE KUMAR AND THE PRINCIPAL FINANCIAL GROUP, INC., APPELLEES
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ReMarc Homes appeals a trial court's denial of attorney's fees and erroneous prejudgment interest calculation in a construction contract dispute. The court held that the trial court abused its discretion by denying attorney's fees to the prevailing party when the contract expressly provided for them, and by awarding prejudgment interest at 9.5% instead of the mandatory statutory rate of 12%.
The trial court erred on both issues. First, under Florida law, prejudgment interest must be awarded at the mandatory statutory rate of 12% per annum, not the contractual 9.5% rate. Second, when a contract expressly provides for attorney's fees and the court finds a party prevailing, the court has no discretion to deny attorney's fees; such contractual provisions must be enforced.
[1] Prejudgment interest must be awarded at the statutory rate when a contract does not specify a different rate.
[2] A trial court errs in denying attorney's fees to a prevailing party when a contract contains a provision for attorney's fees.
Previewing 2 of 3 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“the lower court had no choice but to award the appellant prejudgment interest at the rate of 12% per annum under the authority of Argonaut Ins. Co. v. May Plumbing Co.”
Establishes that prejudgment interest must be computed at the mandatory statutory rate of 12%, not a lower contractual rate.
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Join FLexlaw to unlock all legal intelligenceWilliam Murphy contracted with Bernadette Kumar to build a house; ReMarc Homes took over construction by assignment. Principal Financial Group, the le…
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COBB, Judge.
The issues on this appeal concern the computation of a prejudgment interest award and the trial court’s denial of attorney’s fees.1
William Murphy contracted to build the appellee, Bernadette Kumar, a house. Re-mare Homes, Inc., appellant, took over the construction by way of assignment. The lender in this case, Principal Financial Group, Inc. (appellee), properly released all funds except the final draw which Kumar failed to authorize.
On July 3, 1991, Remare filed a complaint against Kumar alleging breach of contract for failure to release the final draw and for failure to pay for change orders. A counterclaim was subsequently filed by Kumar also alleging breach of contract. Both parties claimed that they were entitled to recover reasonable attorney’s fees pursuant to the contract together with interest and costs.
A final judgment was rendered on April 27, 1992, whereby Remare was awarded $13,500.00 from the last disbursement and Kumar was to recover $2,985.00. The court reserved ruling on costs and attorney’s fees. Later, Remare filed a motion for attorney’s fees and costs plus interest.
On June 2, 1992, the trial court filed an order which denied Remarc’s motion for attorney’s fees but granted their motion to tax costs as a “prevailing party” and granted Remarc’s motion for interest on the $13,500.00 damage award. A notice of appeal was filed on June 3, 1992, and was timely in relation to the post-judgment order of June 2, 1992, which dealt with attorney’s fees, costs, and interest. An amended final judgment was filed on June 4, 1992, which related to the post-judgment order. The trial court expressly held that Remare was the prevailing party in relation to interest and costs but no reason was given for denying Remare attorney’s fees. Additionally, the amended final judgment stated that interest on the $13,500.00 principal would be awarded at % as apparently this was the rate that Kumar was to pay her lender for the funds. Costs had been awarded in the amount of $998.80.
The first issue raised by Remare is whether the trial court erred in awarding prejudgment interest at the rate of 9½% rather than the statutory rate of 12%. As Remare correctly points out, the lower court had no choice but to award the appellant prejudgment interest at the rate of 12% per annum under the authority of Argonaut Ins. Co. v. May Plumbing Co., 474 So. 2d 212 (Fla.1985); see also Broward County v. Finlayson, 555 So. 2d 1211, 1213 (Fla.1990); Kissimmee Util. Auth. v. Better Plastics, Inc., 526 So. 2d 46 (Fla.1988); Florida Steel Corp. v. Adaptable Devs., Inc., 503 So. 2d 1232 (Fla.1986); Ray v. Travelers Ins. Co., ill So. 2d 634 (Fla. 5th DCA 1985).
The second issue raised by Re-mare is whether the trial court erred in denying their motion for attorney’s fees. Generally, with few exceptions, an attorney’s fee provision in a contract cannot be ignored and courts have no discretion to decline to enforce contract provisions for awards of attorney’s fees. Since the trial court found Remare to be the prevailing party in this action, the court erred in denying attorney’s fees. Fortenberry Professional Bldg. v. Zecman, 581 So. 2d 972, 973 (Fla. 5th DCA 1991); Sybert 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 Remare, the prevailing party.
REVERSED AND REMANDED.
W. SHARP, J., and COWART, J„ Retired, concur. . Two issues raised by the appellant cannot be determined since they relate entirely to the original final judgment. The amended final judgment filed by the trial court did not extend the time to appeal issues solely contained within the original judgment. See First Continental Corp. v. Khan, 605 So. 2d 126 (Fla. 5th DCA), rev. denied, 613 So. 2d 3 (Fla.1992).
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Cited By
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Baker Protective Servs. v. FP Inc. & Fid. & Deposit Co. of Md., 659 So. 2d 1120 (Fla. 3d DCA 1995)…t. It is well settled that “with few exceptions, an attorney’s fee provision in a contract cannot be [*1123] ignored and courts have no discretion to decline to enforce contract provisions for awards of attorney’s fees.” Remarc Homes, Inc. v. Kumar, 616 So. 2d 498, 499 (Fla. 5th DCA 1993); accord Fortenberry Professional Bldg. v. Zecman, 581 So. 2d 972 (Fla. 5th DCA 1991); Sybert v. Combs, 555 So. 2d 1313 (Fla. 5th DCA 1990). Since the provision involved clearly and unambiguously purports to hold Baker Protec…
Authorities Cited
- Argonaut Ins. Co. v. MAY Plumbing Co., 474 So. 2d 212 (Fla. 1985)
- Moritz v. Hoyt Enters., Inc., 604 So. 2d 807 (Fla. 1992)
- Broward Cnty. v. Finlayson, 555 So. 2d 1211 (Fla. 1990)
- Fla. Steel Corp. v. Adaptable Developments, Inc., 503 So. 2d 1232 (Fla. 1986)
- Kissimmee Util. Auth. v. Better Plastics, Inc., 526 So. 2d 46 (Fla. 1988)
- Sybert v. Combs, 555 So. 2d 1313 (Fla. 5th DCA 1990)
- First Cont'l Corp. v. Bashir H. Khan, 605 So. 2d 126 (Fla. 5th DCA 1992)
- Golden Cleaver Packing, Inc. v. G & M Hughes Corp., 490 So. 2d 1381 (Fla. 5th DCA 1986)
- Fortenberry Prof'l Bldg. v. Zecman, 581 So. 2d 972 (Fla. 5th DCA 1991)
- Gray v. Michael O'Shaughnessy, Inc., 574 So. 2d 288 (Fla. 5th DCA 1991)