Court Reduces $779,318.66 Verdict Entered Against Stucco Subcontractor to $55,652.00
Craftsman Plastering and Lath, Inc. v. Rath Mor, LLC, arises from a dispute over stucco work on a Palm Beach County construction project and the damages awarded at trial. The property owner hired a general contractor to renovate and build out the property, and the general contractor hired 14 subcontractors, including a stucco subcontractor. All 14 subcontracts contained the same indemnity clause, requiring each subcontractor to indemnify the property owner and the general contractor for claims arising out of or caused by that subcontractor's own act or omission.
Upon discovering construction defects, the property owner sued the general contractor for breach of contract and building code violations, and the general contractor named all 14 subcontractors as third-party defendants. The property owner, general contractor, and 13 subcontractors settled. As part of the settlement, the general contractor assigned its remaining claims against the stucco subcontractor, to the property owner, and the case proceeded to a jury trial against the subcontractor alone.
At trial, the only issue for the jury’s determination was whether the assigned damages fell within the scope of the indemnity clause and, if so, the amount. The general contractor's former defense counsel testified it had incurred $779,318.66 in attorney's fees and costs and that the stucco subcontractor owed all of it. On cross-examination, he admitted the total included fees for suing the other 13 subcontractors and fees related to a counterclaim the general contractor had filed against the property owner, neither of which involved the stucco work. He also conceded he had never separated out the billing attributable to the stucco subcontractor, though he maintained that the “vast majority” of the fees arose from the stucco work and the other claims were “trivial.”
The jury instructions instructed the jury to award the damages supported by the greater weight of the evidence, and the property’s owners closing conceded the jury could choose to discount the requested figure. The jury returned a verdict of $55,652, approximately one-fourteenth of the $779,318.66 sought.
The property owner moved for additur (a trial court's increase of a jury's damages award when the court finds it inadequate). At the additur hearing, the trial judge said he was speculating but believed the jury had "divided by 14." He granted additur anyway, modifying the judgment to the full $779,318.66. The stucco subcontractor then filed a notice of appeal without filing a written acceptance or rejection of the additur.
On appeal, the stucco subcontractor argued that the trial court improperly based the additur on speculation about how the jury reached its number, and that the jury instructions and closing arguments led the jury to believe it was not required to award the full amount requested. The property owner argued, first, that the subcontractor had not preserved its right to appeal because it never filed a written rejection, and second, that even if preserved, there was no abuse of discretion because the $55,652 award was inconsistent with unrefuted evidence supporting $779,318.66 in damages and because the court was not speculating — the jury's divide-by-14 math was obvious.
On the first issue, the Fourth District Court of Appeal held the appeal was properly before it, because neither § 768.74(4), Florida Statutes, nor Florida Rule of Civil Procedure 1.530(h)(3) provides that a party accepts an additur by failing to file a written rejection. That written-election requirement governs a party electing a new trial on damages; a party that instead wants the jury's verdict reinstated may simply file a notice of appeal, which the court construed as a rejection of the additur. The tradeoff: that party waives its right to a new damages trial if the appeal fails.
On the second issue, the Fourth District held that the trial court abused its discretion, for two reasons. First, the divide-by-14 rationale was speculation, and the trial court admitted as much on the record. A trial court must set aside a jury's award where undisputed evidence supports a different calculation, but it does not sit as a seventh juror substituting its own resolution of the facts for the jury's. Second, the damages evidence was not undisputed. Although the stucco subcontractor offered no competing figure, its cross-examination established that the $779,318.66 total included fees for pursuing the other 13 subcontractors and fees tied to the general contractor's counterclaim, neither of which was an "act or omission" covered by the indemnity clause. The evidence on the total was therefore conflicting, and the property owner bore the burden of proving damages. The jury could thus have arrived at $55,652 from the evidence and instructions it was given.
Accordingly, the Fourt District reversed the final judgment granting additur and remanded for entry of judgment consistent with the jury’s verdict.
About the Author:
Jacob Phelps is a Construction Attorney in the Construction Industry Practice Group at Hill Ward Henderson, in Tampa, Florida. Jacob focuses his practice on representing contractors, subcontractors, and material suppliers throughout the state of Florida. He can be reached at jacob.phelps@hwhlaw.com or 813-506-5205.
