CLASS ACTION CERTIFICATION REVERSED BY THE THIRD –So what’s new?
Alderwoods Group v. Garcia, 2013 Fla. App. LEXIS 12002 (Fla. 3d DCA July 31, 2013) reversed a class action certification of: “All persons with burial plots or family members at Graceland Memorial Park South who were buried before 1994, that are unable to readily locate family members due to inadequate recordkeeping and identifying markers.” The Third District again conducted a merits analysis to reverse the class certification order, instead of explaining how the trial court abused its discretion. The court first ruled that t
The remaining claims were also not deemed amenable to class treatment because they required highly individualized proof.
State Farm Fla. Ins. Co. v. Laughlin-Alfonso, 2013 Fla. App. LEXIS 12010 (Fla. 3d DCA July 31, 2013) reversed the denial of attorney’s fees based on the trial judge’s determination that the proposal for settlement—a nominal amount—was not made in good faith. Even though it was an abuse of discretion standard, the court stated that the terms of the policy required the insured to assist State Farm in its investigation of the claim and the insured did not respond to any of State Farm’s requests and failed to submit a Sworn Proof of Loss. The insured also failed to respond to State Farm’s discovery requests. Additionally, she failed to submit any credible evidence to support her supplemental claim, other than the public adjuster's report. The court then concluded that State Farm had a reasonable basis to believe that its exposure was nominal and did not act in bad faith when it made the settlement offer.
But why was the trial court’s contrary conclusion an abuse of discretion?
HSBC Bank United States v. Williams, 2013 Fla. App. LEXIS 12007 (Fla. 3d DCA July 31, 2013) affirmed the award of $74,429 in costs and attorney’s fees against the bank given the bank’s history in the case of disobeying court orders.
ATTORNEY’S FEES / ARBITRATION
Carvajal v. Banc of Am. Inv. Serv., 2013 Fla. App. LEXIS 12009 (Fla. 3d DCA July 3, 2013) explained that the Florida Arbitration Code confers on parties a statutory right to have a court determine entitlement to attorney’s fees. [Note that the Revised Florida Arbitration Code changes that.] “In finding that the parties agreed to submit the issue of attorney’s fees to the arbitrator, the trial court relied on Carvajal’s request for attorney’s fees in his initial arbitration statement of claim. However, requests for attorney’s fees in arbitration pleadings are not sufficient evidence of an express waiver.”
Publix Supermarkets v. Santos, --- So. 3d --- (Fla. 3d DCA July 31, 2013) quashed an order that granted discovery regarding falls at all stores throughout the state for the last three years, reasoning that although overbreadth is generally insufficient to warrant certiorari review, it is appropriate where the discovery grants “carte blanche” to irrelevant discovery.
Peterson v. Lake Surprise II Condo. Assoc., 2013 Fla. App. LEXIS 12021 (Fla. 3d DCA July 31, 2013) reversed an order granting a Fla. R. Civ. P. 1.540(b)(1) motion for relief from the default judgment, which was based upon the mortgagee’s conscious and deliberate - but sadly mistaken - decision, made contrary to advice of counsel, that it was not necessary to answer the complaint. A conscious decision not to comply with the requirements of the law cannot be "excusable neglect" under the rule or any other equivalent requirement.
SETTLEMENTS / FAIR LABOR STANDARDS ACT (FLSA)
Nall v. Mal-Motels, Inc., 2013 U.S. App. LEXIS 15378 (11th Cir. Fla. July 29, 2013) reversed an order approving and enforcing a settlement agreement because it was neither (1) reached under the supervision of the Secretary of Labor, nor (2) was the district court presented with a proposed settlement which the court scrutinized for fairness. The circuit opinion explained that Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350 (11th Cir. 1982) applied equally to a current employee as to a former employee. Lynn's Food recognized Congress' concern that "there are often great inequalities in bargaining power between employers and employees." Id. at 1352. The most cause for concern exists when the plaintiff employee is still working for the defendant employer. But the court concluded that the rule of Lynn's Food should also apply to settlements between former employees and employers.
The agreement here was not made under the supervision of the Secretary of Labor, so it is valid only if the district court entered a "stipulated judgment" approving it. Lynn's Food, 679 F.2d at 1352-54. The court did enter a judgment approving the settlement, but it was not a stipulated one. “[I]t takes two (or more) to stipulate, and a judgment to which one side objects is not a stipulated one.” Here, plaintiff’s attorney objected to approval, contending that the terms were not fair and reasonable.
LJL 33rd St. Assocs. v. Pitcairn Props., 2013 U.S. App. LEXIS 15625 (2d. Cir. July 31, 2013) reversed a district judge who vacated an arbitrator’s determination based on his conclusion that the arbitrator committed misconduct in violation of the Federal Arbitration Act, 9 U.S.C. § 10(a)(3), in excluding certain hearsay evidence offered by Pitcairn. That statute provides that a reviewing court may vacate an arbitration award “where the arbitrators were guilty of misconduct in . . . refusing to hear evidence pertinent and material to the controversy.”
The district court recognized that the excluded valuations were all hearsay. It noted, however, that in arbitration proceedings there is no need to comply with strict evidentiary rules. “While it is indisputably correct that arbitrators are not bound by the rules of evidence and may consider hearsay, it does not follow that arbitrators are prohibited from excluding hearsay evidence, especially when (a) the evidence could be presented without reliance on hearsay and (b) its hearsay nature is unfairly prejudicial to the adversary. As to Pitcairn’s four exhibits, both conditions applied. So far as appears, there was no good reason for Pitcairn to rely on hearsay. It could have presented this evidence, unencumbered by the hearsay objection, merely by calling the makers of the exhibits — thus providing LJL with the opportunity to cross-examine these witnesses in an effort to undermine the probative value of the exhibits.”
Similarly, in Doral Financial v. García-Vélez, the losing party sought before the First Circuit to vacate the resulting arbitration award in the latter matter for “misconduct in refusing to hear evidence pertinent and material to the controversy” under §10(a)(3) of the Federal Arbitration Act. The First Circuit Court of Appeals rejected that challenge based on the argument that the arbitration tribunal engaged in misconduct by denying the issuance of pre-hearing and hearing subpoenas.
"Every failure of an arbitrator to hear relevant evidence does not constitute misconduct requiring vacatur of an arbitrator's award. … Vacatur is appropriate only when the exclusion of relevant evidence so affects the rights of a party that it may be said that he was deprived of a fair hearing."