Court Determines General Contractor Entitled to Attorneys' Fees Award Against Subcontractor Despite Jury Apportionment of Damages
Babin Builders and Development Inc v. Quinones, arises from a dispute between a property owner, general contractor, and stucco subcontractor. In 2010 the property owner hired the general contractor to build a single family home. The general contractor in turned hired the stucco subcontractor for the project. When the property owners ultimately filed a lawsuit against the general contractor for construction defects, the general contractor filed a third party complaint against the stucco subcontractor, and others, alleging breach of contract, indemnity, negligence, and violation of building codes.
Following a jury trial, the jury entered a verdict in favor of the property owner against the general contractor. However, the jury attributed 60% of the damages incurred by the property owner to the general contractor and 40% to the stucco subcontractor. The trial court entered a directed verdict in favor of the general contractor and against the stucco subcontractor on the breach of contract and violation of building code claims.
The general contractor then filed a motion for an award of its attorneys’ fees against the stucco subcontractor, citing a prevailing party fee provision in the proposal prepared by the stucco subcontractor. The provision stated:
Should either party require the services of an attorney to enforce the terms of this proposal, the prevailing party shall be entitled to reasonable attorney's fees and costs.
In response the stucco subcontractor argued that the fee provision did not apply to fees incurred by the general contractor in defending itself against the property owner’s claims and that the general contractor was not the prevailing party due to the apportionment of damages by the jury. The trial court denied the motion, finding that the general contractor was not the prevailing party due to the jury apportionment. The general contractor appealed.
On appeal the general contractor argued that the trial court erred in basing its prevailing party determination on the jury’s apportionment of the property owner’s damages between the general contractor and the stucco subcontractor, while ignoring that the stucco subcontractor had breached its contract with the general contractor and violated building codes that damaged the general contractor.
The First District Court of Appeal agreed with this argument, noting first that general rule for construction cases is that the party that prevails on the significant issues in litigation is the one that should be considered the prevailing party for attorneys’ fees, and that a net judgment one way or the other need not control that determination. The court concluded:
Here, as to [the general contractor’s] third-party claims, the jury determined that [the stucco subcontractor] breached its contract with [the general contractor] and violated applicable building codes in its work on the [property owner’s] home. The jury did not conclude that [the general contractor] contributed to the breach or any defect in the work performed by [the stucco subcontractor]. While the jury apportioned a greater percentage of the damages incurred by the [property owners] to [the general contractor], this does not control on the issue of attorney's fees for [the general contractor’s] third-party claims. An apportionment of liability on claims raised in an original complaint does not determine an award of attorney's fees in a third-party complaint raising separate issues specific to those parties.
The First DCA reversed the trial court’s order and remanded for the entry of an award to the general contractor of its attorneys’ fees incurred on the third-party claims.
Jason Lambert is a Florida Board Certified Construction Attorney and Partner in the Construction Industry Practice Group at Hill Ward Henderson, in Tampa, Florida. He is also the founder and chief contributor to the Hammer & Gavel construction law blog. Jason focuses his practice on representing contractors, subcontractors, and materials suppliers throughout the state of Florida. Before law school, Jason spent a decade working in the construction industry, primarily as a project manager and operations director for both new construction and remodeling. He can be reached at jason.lambert@hwhlaw.com or 813-227-8495.
