When the Sale of a Cemetery Unearths a Claim for Breach of Fiduciary Duty
DFG Group, LLC. v. Heritage Manor of Memorial Park, Inc., 2018 WL 527013 (Fla. 4th DCA Jan. 24, 2018)
In DFG Group, the Fourth District reversed a final judgment awarding attorney’s fees as damages in a lawsuit involving the sale of a cemetery.
The owners of Heritage Manor Memorial Park retained a law firm to assist them with the sale of the cemetery. What the sellers didn’t know was the same firm also represented the buyers. After the sale, the sellers discovered that the law firm received a $100,000 kickback. The sellers filed a lawsuit against the buyers and the attorney defendants for intentional misrepresentation, willful non-disclosure, breach of contract, civil theft, conspiracy to breach fiduciary duty, and aiding and abetting breach of fiduciary duty. The attorney defendants settled. As to the buyers, the jury found that the sellers were entitled to damages compromised of the attorneys’ fees, costs for the transaction and punitive damages. The buyers moved for judgment notwithstanding the verdict, arguing that the attorney’s fees were not a proper element of damages.
The Fourth District agreed with the buyers and found that the trial court did not apply the correct measure of damages, causing fundamental error. Fundamental error can occur when a party recovers damages they are not entitled to. When recovering damages in a tort claim, the goal is to place the party back to the position they were in before the injury occurred. In this case, the jury found that there was no difference between the sale price and the fair market value price at the time of sale. Therefore, the seller did not suffer a loss. Moreover, since the seller did not suffer a loss, attorney’s fees could not be part of the damages. Additionally, the seller was not entitled to punitive damages because to obtain punitive damages there had to be a compensatory damages award.
Real estate transactions occur every day. A buyer and seller want to avoid a breach of the contract or a misrepresentation arising during the transaction. Having the right counsel to guide you through the legal process, while making sure your rights are protected is important. If you or someone you know has a breach of contract claim or requires legal representation as a buyer or seller in a commercial or residential real estate transaction, please contact the lawyers at Kahn & Resnik, P.L. Our lawyers proudly serve all of Florida and will fully represent your legal needs. Call us now at 954-321-0176 to set up a consultation.