S. A. STONE, APPELLANT,
v.
PEMBROKE LAKES TRAILER PARK, INC., APPELLEE
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Stone, a real estate broker, held a $2,000 deposit from Pembroke Lakes Trailer Park in connection with a failed property sale. When Stone sued for his $10,000 broker's fee (claiming the deposit offset part of it), Pembroke lost that suit. Pembroke then sued to recover the deposit, but the court reversed the judgment for Pembroke, holding that such claim was a compulsory counterclaim that should have been raised in Stone's prior declaratory judgment action.
The court held that Pembroke's claim for return of the deposit was a compulsory counterclaim that arose out of the same transaction as Stone's declaratory judgment action due to their logical relationship. The close connection between the two suits meant Pembroke's claim should have been presented as a counterclaim in the prior action, and its failure to do so bars the present suit.
[1] A claim is a compulsory counterclaim if it is logically related to the opposing party's claim and arises out of the same transaction or occurrence.
[2] The phrase "transaction or occurrence" in the context of compulsory counterclaims should be interpreted broadly and realistically to avoid a multiplicity of suits.
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Join FLexlaw to unlock all legal intelligence“'transaction' is a word of flexible meaning. It may comprehend a series of many occurrences, depending not so much upon the immediateness of their connection as upon their logical relationship.”
Establishes the broad interpretation courts should give to 'transaction or occurrence' in determining whether claims are logically related for compulsory counterclaim purposes.
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Join FLexlaw to unlock all legal intelligenceStone, a real estate broker, held a $2,000 deposit from Pembroke Lakes Trailer Park related to a proposed property sale. The underlying property sale …
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Defendant-appellant, S. A. Stone, appeals a final judgment entered in favor of 'the plaintiff-appellee, Pembroke Lakes Trailer Park, Inc., which directs a return of a deposit held by the defendant in his capacity as a real estate broker. We reverse.
The litigation in the case sub judice arose out of the following factual situation. The defendant Stone is a real estate broker who attempted to arrange a sale of property to the plaintiff. A contract for sale was entered into between the plaintiff-buyer, Pembroke Lakes Trailer Park, Inc. (Pembroke), and a third party, Park City Mobile Homes Estates, Inc. (Park). Pembroke deposited with the broker Stone two thousand dollars on account of the purchase price. Stone was to earn a commission of ten thousand dollars upon sale of the property. However, Park refused to abide by its contract and Pembroke was forced to bring an action for specific performance in which it was successful. Park appealed the decision, but some arrangement between the parties was reached and the appeal was dismissed, but no arrangement was made concerning any broker’s fees.
Stone, the broker, then brought an action for declaratory relief against both Pembroke and Park alleging that he was entitled to a broker’s fee of ten thousand dollars, and reciting that he had in his possession two thousand dollars, and that therefore only eight thousand dollars was owed. Judgment for the defendants was entered in the declaratory judgment action, and it does not appear that this judgment was appealed.
Pembroke then brought this suit for the return of the two thousand dollars in the possession of the broker, Stone. Stone answered admitting that he had the money, but defended upon the sole ground that Pembroke was barred from bringing this suit due to the provisions of Fla.R.Civ.P. 1.170(a), 30 F.S.A., the compulsory counterclaim rule, because Pembroke had not asserted a counterclaim in the suit brought by Stone. The trial judge held that Pembroke’s claim was not compulsory and entered judgment for the plaintiff. This appeal followed.
The sole question for our determination in the case sub judice is whether under these circumstances Pembroke’s claim against the broker Stone “arises out of the transaction or occurrence that is the subject matter of the opposing party’s claim.” The parties agreed that the exceptions provided by the rule do not apply in the case at bar.
The Florida rule is in this case substantially identical with the Fed.R.Civ.P. 13.
*402It has been said that courts should give the phrase “transaction or occurrence that is the subject matter of the suit” a broad realistic interpretation in the interest of avoiding a multiplicity of suits. See Dazian’s Inc. v. Switzer Brothers, Inc., 14 F.R.D. 24 (N.D.Ohio 1953). Thus, subject to the exceptions inherent in the rule, any claim that is logically related to another claim that is being sued on is properly the basis for a compulsory counterclaim. Such a definition would further the purpose of the rule in that it would minimize litigation and prevent a multiplicity of suits. See generally Moore-Vestal-Kurland, Moore’s Manual, Federal Practice and Procedure § 11.09(3) (1971); 6 Wright & Miller, Federal Practice and Procedure § 1410 et seq. (1971); 1A, Barron and Holtzoff, Federal Practice and Procedure § 394 at 573 (Rules ed. 1960) and cases cited n. 79.15.
The definition of “transaction” was also at issue in the leading case of Moore v. New York Cotton Exchange, 270 U.S. 593, 46 S.Ct. 367, 70 L.Ed. 750 (1926). In Moore, the plaintiff was suing the exchange, claiming a violation of the federal antitrust laws because the defendant, New York Cotton Exchange, refused to furnish the plaintiff with current market price quotations. The exchange counterclaimed for an injunction, claiming that the plaintiff was illegally obtaining the current market quotations. After the main complaint was dismissed, the plaintiffs moved for dismissal of the defendant’s counterclaim on the ground that it did not arise out of any transaction which was the subject matter of the main suit. The United States Supreme Court in affirming the denial of the motion, said that:
“ ‘[transaction’ is a word of flexible meaning. It may comprehend a series of many occurrences, depending not so much upon the immediateness of their connection as upon their logical relationship. . . . Essential facts alleged by appellant enter into and constitute in part the cause of action set forth in the counterclaim. That they are not precisely identical, or that the counterclaim embraces additional allegations, does not matter. To hold otherwise would be to rob this branch of the rule [Equity Rule 30] of all serviceable meaning, since the facts relied upon by the plaintiff rarely, if ever, are, in all particulars, the same as those constituting the defendant’s counterclaim.
“So close is the connection between the case sought to be stated in the bill and that set up in the counterclaim, that it only needs the failure of the former to establish a foundation for the latter; . . . .” Moore v. New York Cotton Exchange, 270 U.S. at 610, 46 S.Ct. at 371 (Emphasis supplied.)
Applying these definitions to the case sub judice, it is clear that the present suit is barred as it arose out of the same transaction that was the subject matter of the opposing party’s claim due to their logical relationship The opposing party in the prior suit (Stone, the present defendant), claimed that he was owed monies for his broker’s fees. Pembroke, the plaintiff in the present suit claims, in effect, that since the prior suit (in which Pembroke was a defendant) determined that the broker was not entitled to any broker fees, it is entitled to the return of its money. While we do not render any decision ori the correctness of plaintiff-appellee’s claim, its failure to present its claim for judicial determination in the prior action, pursuant to Fla.R.Civ.P. 1.170(a), bars Pembroke from doing so now, for so close is the connection between the two suits, that plaintiff’s present suit needed only the failure of the defendant’s prior suit to establish a foundation for this suit. See Hightower v. Bigoney, 156 So.2d 501 (Fla. 1963); Lawyers Title Ins. Corp. v. Little River Bank & Trust Company, 228 So.2d 412 (Fla.App.1969); Pesce v. Linaido, 123 So.2d 747 (Fla.App.1960).
*403Accordingly, the judgment of the trial court is reversed and the cause remanded with instructions to dismiss plaintiff’s complaint with prejudice.
Reversed and remanded, with instructions.
REED, C. J., and OWEN, J., concur.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By (16 total)
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Javier H. Londono, M.D. v. Turkey Creek, Inc., 609 So. 2d 14 (Fla. 1992)…ct court noted, the courts have defined “transaction or occurrence” with a “broad realistic interpretation” in order to avoid numerous lawsuits from the same facts. Turkey Creek, 567 So. 2d at 945 (quoting Stone v. Pembroke Lakes Trailer Park, Inc., 268 So. 2d 400, 402 (Fla. 4th DCA 1972)). The Fifth District Court of Appeal adopted the following four-part test to determine whether a defendant had a compulsory counterclaim: (1) Are the issues of fact and law raised by the claim and counterclaim largely the s…
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Maye G. Neil v. S. Fla. Auto Painters, Inc., 397 So. 2d 1160 (Fla. 3d DCA 1981)…st keep in mind that the goal of the compulsory counterclaim rule is “to prevent multiplicity of actions and to achieve a just resolution in a single lawsuit of all disputes arising out of common matters.” Stone v. Pembroke Lakes Trailer Park, Inc., 268 So. 2d 400 (Fla. 4th DCA 1972); 3 Moore’s Federal Practice ¶ 13.12[1], at 13-273 (2d ed. 1980). Therefore, to achieve this goal, we must give the phrase “transaction or occurrence” a broad, realistic interpretation. Stone v. Pembroke Lakes Trailer Park, Inc.,…1 / 2
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Taussig v. Ins. Co. OF N. Am., 301 So. 2d 21 (Fla. 2d DCA 1974)…the instant case are such as to put the rule to a severe test in its very first application, we are inclined to believe that the counterclaim was compulsory. In considering this issue in Stone v. Pembroke Lakes Trailer Park, Inc., Fla.App. 4th 1972, 268 So. 2d 400, at page 402, the court said: “It has been said that courts should give the phrase ‘transaction or occurrence that is the subject matter of the suit’ a broad realistic interpretation in the interest of avoiding a multiplicity of suits. * * * Thus,…
Previewing 3 of 16 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Moore v. N.Y. Cotton Exch., 270 U.S. 593 (U.S. 1926)
- Hightower v. Bigoney, 156 So. 2d 501 (Fla. 1963)
- Coleen Pesce v. Eli Linaido and Ronny Molko, 123 So. 2d 747 (Fla. 3d DCA 1960)
- Lawyers Title Ins. Corp. v. Little River Bank & Tr. Co. & Rachel Mechlowitz, 228 So. 2d 412 (Fla. 3d DCA 1969)