Opinion
CASE NO. 20-25162-CIV-ALTONAGA/Torres
2022-05-18
RJ'S INTERNATIONAL TRADING, LLC, Plaintiff, v. CROWN CASTLE SOUTH LLC, Defendant.
Jennito Simon, Pierre Simon, LLC, Fort Lauderdale, FL, Faudlin Pierre, Miami, FL, for Plaintiff. Eve Alexis Cann, Aldo M. Leiva, Baker Donelson Bearman Caldwell & Berkowitz PC, Fort Lauderdale, FL, Desislava K. Docheva, Fort Lauderdale, FL, for Defendant.
Jennito Simon, Pierre Simon, LLC, Fort Lauderdale, FL, Faudlin Pierre, Miami, FL, for Plaintiff.
Eve Alexis Cann, Aldo M. Leiva, Baker Donelson Bearman Caldwell & Berkowitz PC, Fort Lauderdale, FL, Desislava K. Docheva, Fort Lauderdale, FL, for Defendant.
ORDER
CECILIA M. ALTONAGA, CHIEF UNITED STATES DISTRICT JUDGE THIS CAUSE came before the Court on Plaintiff, RJ's International Trading, LLC's Motion for Attorneys’ Fees and Costs (Entitlement Only) [ECF No. 158 ], filed on March 27, 2022. Defendant, Crown Castle South LLC filed a Response [ECF No. 164 ], to which Plaintiff filed a Reply [ECF No. 165 ]. Having considered the parties’ written submissions, the record, and applicable law, the Motion is denied. The Court explains.
The Court assumes the reader's familiarity with the underlying facts of this case, which are set forth in detail in the November 15, 2021 Order [ECF No. 104 ] denying Defendant's Motion for Summary Judgment [ECF No. 71 ] and granting Plaintiff's Partial Motion for Summary Judgment [ECF No. 73 ].
Standard . Under the "American Rule" governing entitlement to attorney's fees, parties generally must bear their own attorneys’ fees unless a statute or contract expressly provides otherwise. See Hardt v. Reliance Standard Life Ins. Co. , 560 U.S. 242, 252–53, 130 S.Ct. 2149, 176 L.Ed.2d 998 (2010) (citations omitted). In diversity cases, courts apply state law to determine a party's right to attorney's fees. See Prime Ins. Syndicate, Inc. v. Soil Tech Distribs., Inc. , 270 F. App'x 962, 963 (11th Cir. 2008) (citation omitted). "Florida generally follows the American Rule, under which each side pays its own attorney's fees." Azalea Trace, Inc. v. Matos , 249 So. 3d 699, 701 (Fla. 1st DCA 2018) (citing Johnson v. Omega Ins. Co. , 200 So. 3d 1207, 1214 (Fla. 2016) ).
Discussion . Neither Plaintiff nor Defendant signed the original Easement Agreement [ECF No. 71-3 ], yet Plaintiff insists that, as a covenant, the Easement Agreement's attorney's fee provision runs to successors-in-interest, including Defendant. (See Mot. 7). Plaintiff is mistaken.
Plaintiff also mischaracterizes the Summary Judgment Order. (See, e.g. , Mot. 6 ("This Court determined that Crown Castle had breached the easement agreement; thereby, concluding that Crown Castle and RJI were parties to the agreement." (citations omitted)). The Court did not conclude that Defendant was an original party to the Easement Agreement; rather, the Court explicitly treated Defendant as a successor-in-interest. (See Nov. 15, 2021 Order 10–11). The present analysis adheres to the Court's prior treatment.
Courts define covenants as " ‘promises in conveyances or other instruments pertaining to real estate.’ " Palm Beach Cnty. v. Cove Club Invs. Ltd. , 734 So. 2d 379, 382 n.4 (Fla. 1999) (quotation marks omitted; quoting 19 Fla. Jur. 2d Deeds § 168 (1998) ). There are two types of covenants: real and personal. A personal covenant creates an obligation or right enforceable between only the original contracting parties, whereas a real covenant creates a servitude upon the property for the benefit of another parcel. See id. Successors-in-interest are bound by real covenants, but not by personal ones. See id.
The primary test whether the covenant runs with the land or is merely personal is whether it concerns the thing granted and the occupation or enjoyment thereof or is a collateral or a personal covenant not immediately concerning the thing granted. In order that a covenant may run with the land it must have relation to the land or the interest or estate conveyed, and the thing required to be done must be something which touches such land, interest, or estate and the occupation, use, or enjoyment thereof.
Hagan v. Sabal Palms, Inc. , 186 So. 2d 302, 310 (Fla. 2d DCA 1966) (citation and quotation marks omitted). The test to determine whether a covenant runs with the land contains three elements: (1) there must be a covenant that touches and concerns the land, (2) with the intent that the covenant run with the land, and (3) notice of the restriction to the party against whom enforcement is sought. See Winn-Dixie Stores, Inc. v. Dolgencorp, Inc. , 964 So. 2d 261, 265 (Fla. 4th DCA 2007) (citations omitted).
The Motion fails to satisfy the first element: the attorney's fee provision does not touch upon and concern the land. To determine whether the provision touches and concerns the land, courts focus on the provision's effect on the " ‘occupation and enjoyment’ " of the property. Hayslip v. U.S. Home Corp. , 276 So. 3d 109, 115 (Fla. 2d DCA 2019) (quotation marks omitted; quoting Hagan , 186 So. 2d at 310 ), aff'd , No. SC19-1371, 336 So.3d 207, 208–09 (Fla. Jan. 27, 2022).
The attorney's fee provision states:
The parties hereto shall each have the right to enforce the terms of this Easement and the rights and obligations created herein by all remedies provided under the laws of the State of Florida, including, without limitation, the right to sue for damages for breach or for injunction or specific performance. In the event that it is necessary for either party hereto to file suit in order to enforce the terms hereof, then the prevailing party in such suit shall be entitled to receive reasonable attorney's fees and court costs in addition to any other award that the court might make, from the non-prevailing party.
The Court uses the pagination generated by the electronic CM/ECF database, which appears in the headers of all court filings.
Not even a generous interpretation of this provision yields a conclusion that it somehow affects the enjoyment of the premises. Although this appears to be a matter of first impression in Florida, the bulk of other jurisdictions agree that an attorney's fees provision does not touch and concern the land. See, e.g. , Paloma Inv. Ltd. P'ship v. Jenkins , 194 Ariz. 133, 978 P.2d 110, 116 (Ariz. Ct. App. 1998) ("[T]he attorneys’ fees provision is a covenant that does not meet the four-part test for a covenant running with the land." (alteration added; citation omitted)); Lundeberg v. Dastrup , 28 Utah 2d 28, 497 P.2d 648, 650 (1972) ("[A] provision in a purchase contract to pay attorney's fees necessary for enforcement of its terms does not meet the qualification for a covenant which runs with the land." (alteration added)); Keogh v. Peck , 259 Ill. App. 503, 518 (Ill. App. Ct. 1931) ("The covenant to pay solicitor's fees and other expenses, etc., is only collateral. It in no way concerns the land, the improvements on the land, the title to the land, nor the quality or character of either. It is not ‘annexed to the estate of the land in privity.’ ").
More importantly, the conclusion comports with Florida law. In Hayslip v. U.S. Home Corporation , the petitioners argued they were not bound by a deed's arbitration clause because it did not touch land. See 336 So.3d at 209–10. The court disagreed. Relying on the arbitration clause's impact on an occupant's ability to rectify defects in the home, the court concluded that the provision touched and concerned the land because it "affect[ed] ‘the mode of enjoyment of the premises.’ " Id. (alteration added; quotation marks omitted; quoting Winn-Dixie Stores , 964 So. 2d at 264 ).
The same concern is not present here. Plaintiff insists that "[t]here is no logical distinction between the arbitration provision in Hayslip and the remedies provision in this case." (Reply 7 (alteration added)). But arbitration is a procedure for enforcing covenants, whereas attorney's fees are the prevailing party's remedy. The attorney's fees provision does not provide "the means by which the [successor] must seek to rectify building defects related to the home." Hayslip , 336 So.3d at 210 (alteration added; citation omitted). Nor is the attorney's fees provision "triggered when an apparent defect ... is realized and the [successor] seek[s] recourse[.]" Id. (alterations added). Rather, only a certain outcome of that recourse triggers the attorney's fees provision — an event that is conceptually once-removed from the land defects giving rise to recourse.
Furthermore, paying attorney's fees does not "affect[ ] the mode of enjoyment of the premises." Id. (alteration added; citations and quotation marks omitted). As the court in Caulk v. Orange County held, "[t]he only thing the covenant ... really ‘touches’ and ‘concerns’ is the intangible personal property, namely cash, that may be paid[.]" 661 So. 2d 932, 934 (Fla. 5th DCA 1995) (alterations added). There, an unusually prescient covenant guaranteed that the former owner could recover any proceeds the government paid to the current owner. See id. at 933. When the government initiated a condemnation action against the property, the former owner intervened to recover the proceeds. See id. The court, however, barred the former landowner from recovering because the covenant did not touch and concern the land. See id. at 934. Unlike covenants that "directly impact the use of the land," a covenant guaranteeing the transfer of cash had "no effect ... on the land." Id. (alteration added).
Plaintiff fails to address Caulk despite the apparent parallels. Like a covenant to pay government proceeds, a covenant to pay attorney's fees touches and concerns the cash exchanged between the parties, not the underlying land that gives rise to the exchange. Sure, both tangentially relate to the land, but not in a matter that affects the occupants’ "mode of enjoyment of the premises." Hayslip , 336 So.3d at 210 (alteration added; citation and quotation marks omitted).
Absent a nexus to the easement, Plaintiff cannot demonstrate that the attorney's fee provision touches, let alone runs with, the land. Consequently, Defendant is not subject to the attorney's fee provision. Accordingly, it is
ORDERED AND ADJUDGED that Plaintiff, RJ's International Trading, LLC's Motion for Attorneys’ Fees and Costs (Entitlement Only) [ECF No. 158 ] is DENIED.
DONE AND ORDERED in Miami, Florida, this 18th day of May, 2022.