Key Points

  • The Fourth District reversed a $269,571.88 judgment awarding attorney's fees, costs and prejudgment interest to the assignees of a home purchase contract against the buyer who assigned it.
  • The court held that the purchase agreement's prevailing-party fee clause did not authorize fees between the buyer and his assignees, who took the buyer's place opposite the sellers, and the assignment itself contained no fee provision.
  • The court affirmed the judgment upholding the assignment and rejecting the buyer's rescission claim, holding the trial court did not have to address each rescission theory in writing.
  • The court held that fee entitlement reserved in a partial final judgment was not ripe for review in the first appeal.
  • The court held that section 86.081, not section 57.041, governs costs in declaratory judgment actions and affirmed the denial of costs against the backup buyer.

A Florida appeals court on Oct. 7 threw out a $269,571.88 judgment for attorney's fees, costs and interest entered against a would-be homebuyer in the private Sailfish Point community. The court held that the fee clause in his purchase contract did not cover his dispute with the couple to whom he had handed off the deal.

Judge May wrote for a unanimous Fourth District Court of Appeal panel that included Judges Gross and Ciklin. The panel sided with the buyers, Guy Bennett Rubin and Stephanie Rubin, on fees. It otherwise affirmed a judgment upholding the assignment, a transfer of the buyer's contract rights, to a company owned by a husband and wife.

The decision turns on which side of a contract an assignee occupies. The panel held that the assignees took the buyer's place opposite the sellers, so a prevailing-party fee clause, which lets the winner of a lawsuit collect legal fees from the loser, did not authorize fees between the buyer and the people who stepped into his shoes.

The dispute began when the sellers agreed to sell a house in the community to the husband, the only spouse who signed the contract. Under the community's declarations and covenants, the sale could not close without an approval certificate from the Sailfish Point Property Owners' and Country Club Association. Mr. Rubin was already leasing a home there and had been approved, but the association required a second membership application. The sellers also signed a backup contract with another buyer.

"As luck would have it, the association denied the buyer's membership application and the appeal of that denial," Judge May wrote. The association conditionally approved the backup buyer instead.

To save the deal, Mr. Rubin assigned his rights to CKENA5 Holdings, LLC, owned by residents who were already approved association members. The closing agent advised that the contract remained valid and assignable, and the association confirmed the assignment could proceed, according to the opinion. The assignees agreed to pay Mr. Rubin $37,181.25.

Less than a day later, the association said it would not let the sale close. It took the position that the purchase agreement had "automatically terminated upon the association's denial of the buyer's membership application, leaving no agreement to assign," the opinion said.

The Rubins sued the association for declaratory and injunctive relief, tortious interference and negligent misrepresentation. They also sought rescission, or cancellation, of the assignment on grounds including lack of consideration, impossibility and mutual mistake. The assignees counterclaimed for a declaration that the assignment was enforceable.

Martin County Circuit Judge Nancy F. Alley entered a partial final judgment finding the purchase agreement had never terminated, the assignment was valid and could not be rescinded, the assignees could close, and the backup contract never took effect. A jury returned a $1,430,000 verdict for the Rubins against the association.

The assignees then sought fees from Mr. Rubin under Paragraph 17 of the purchase agreement. The trial court first limited any award to the rescission claim, then reversed itself, calling that limit "in error" and finding all the claims inextricably intertwined because enforcement of the assignment and defense of the rescission claim were "part and parcel" of one another. It awarded $248,767.50 in attorney's fees, $8,852.55 in costs and expert witness fees, and $11,951.83 in prejudgment interest.

On appeal, Mr. Rubin argued that the assignment contained no fee provision and that Paragraph 17 covered only disputes between buyer and sellers. The assignees responded that the purchase agreement provided that an assignment did not release the buyer absent a written release or novation.

The panel sided with Mr. Rubin. Paragraph 17 provided, "In any litigation permitted by this Contract, the prevailing party shall be entitled to recover from the non-prevailing party costs and fees, including reasonable attorney's fees, incurred in conducting the litigation." The court also quoted a 1988 First District decision. "Attorney's fees are not necessarily recoverable as to any and all litigation relating to a contract that provides for attorney's fees," the First District had written, quoting a 1983 Fifth District decision.

Judge May acknowledged that an assignee "stands in the shoes" of the assignor and may enforce a contract's fee provision where the contract provides for it. "While the assignment placed the assignees in the buyer's shoes with respect to the sellers, it did not place the assignees in the sellers' shoes such that they could recover attorney's fees against the buyer," Judge May wrote. "Neither Paragraph 17 of the purchase agreement, nor any provision of the assignment, entitles the assignees to recover fees."

In the main appeal, the panel rejected Mr. Rubin's argument that the trial court erred by not addressing his impossibility and frustration-of-purpose theories. The court held that "the trial court was not required to separately address each theory supporting rescission in writing," and it affirmed the rulings on mutual mistake and consideration without discussion.

The panel also declined to review fee entitlement in that appeal. It held the issue was not ripe, meaning not yet ready for appellate review, because the partial final judgment "merely retained jurisdiction to consider future motions for attorney's fees and costs."

Mr. Rubin also lost his bid for costs against the backup buyer. He had relied on section 57.041 of the Florida Statutes, which generally requires a costs award to the party recovering judgment. The panel held that section 86.081, which governs declaratory judgment actions and provides that "[t]he court may award costs as are equitable," controlled, and that the trial court acted within its discretion.

The Rubins were represented by Guy Bennett Rubin of Rubin & Rubin. Lawyers for the assignees included Tim B. Wright of Wright, Ponsoldt & Lozeau Trial Attorneys, L.L.P.

The court affirmed on all issues in case No. 4D2024-2398 and reversed the fee award in case No. 4D2025-1575. The opinion states that it is not final until the court disposes of any timely motion for rehearing.