Plaza Tower Realty Group, LLC v. 300 South Duval Associates, LLC , 223 So. 3d 1079 ( 2017 )

Third District Court of Appeal
State of Florida
Opinion filed May 24, 2017.
Not final until disposition of timely filed motion for rehearing.
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No. 3D16-1491
Lower Tribunal No. 14-26949
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Plaza Tower Realty Group, LLC,
Appellant,
vs.
300 South Duval Associates, LLC, and The Union Labor Life
Insurance Company,
Appellees.
An Appeal from the Circuit Court for Miami-Dade County, Jose M.
Rodriguez, Judge.
Vezina, Lawrence & Piscitelli, P.A., and Michael Piscitelli and Jodi N.
Cohen (Fort Lauderdale), for appellant.
Woodbury, Santiago & Correoso, P.A., and Michael Woodbury and
Margaret Brenan Correoso, for appellees.
Carlton Fields Jorden Burt, P.A., and Matthew J. Conigliaro (Tampa), for
the Florida Association of Realtors, Inc., d/b/a Florida Realtors, as amicus curiae.
Before ROTHENBERG, SALTER, and FERNANDEZ, JJ.
ROTHENBERG, J.
The plaintiff below, Plaza Tower Realty Group, LLC (“the Broker”),
appeals from a final summary judgment entered in favor of defendants 300 South
Duval Associates, LLC (“300 South Duval”) and The Union Labor Life Insurance
Company (“Union Labor”) (collectively, “the Lenders”). The trial court
determined that, pursuant to the Exclusive Agency Listing Agreement (“listing
agreement”) between the Broker and the developer, Kleman Plaza, LLLP (“the
Developer” or “Owner”), the Broker did not have an “ownership interest” in the
deposits retained by the Developer and subsequently remitted from the Developer
to the Lenders to reduce the balance of the Developer’s construction loan after
contracted purchasers failed to close.
Based on the clear and unambiguous language in the listing agreement, we
conclude that the Broker did have an “ownership interest” in a portion of the
retained deposits because the listing agreement identifies the retained deposits as
the particular fund from which the Broker will be paid any commission due and
owing in the event that a unit fails to close. Therefore, we reverse the final
summary judgment entered in favor of the Lenders, and remand for further
proceedings consistent with this opinion.
I. FACTS
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In May 2004, the Broker and the Developer entered into the listing
agreement, which includes the following provisions that govern the resolution of
the issue raised in this appeal:
7. Compensation. As compensation for all services to be rendered to
Owner by Broker during the term of this Agreement, Owner and
Broker agree that, subject to the terms hereinafter set forth, Broker
shall be deemed to have earned and be entitled to receive sales
commissions only in accordance with the following:
....
(e) Anything contrary herein notwithstanding, Broker shall not
be entitled to any commission whatsoever as to the sale of a
Unit which fails to close for any reason whatsoever, including,
without limitation, the default of Owner, provided, however,
that in the event that a contract is cancelled and/or a sale fails to
close for any reason whatsoever, and Owner retains the
purchaser’s deposits in connection therewith, then, in such
event, Broker shall be paid a commission equal to one third of
the amount of the retained deposits less all collections
expenses, but not to exceed the full commission Broker would
have earned had the defaulting buyer closed on his purchase
contract. . . .
....
(g) From the date when at least sixty percent (60%) of the Units
have satisfied the Eligibility Requirement (the “Threshold
Date”), Owner shall pay Broker, as an advance, fifteen percent
(15%) of the commissions which Broker is eligible to receive.
These advance commission payments shall also be retroactively
applicable to all Units that met the Eligibility Requirements
prior to the Threshold Date. All commission advances paid to
Broker shall be offset against final commission’s payable to
Broker from Unit closings or from retained deposits pursuant
to paragraph 7(e) above. . . .
(emphasis added).
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The Broker secured 100 pre-construction purchase and sales agreements
pursuant to the listing agreement. Thereafter, the contracted purchasers’ deposits
were placed into an escrow account at First American Title Insurance Company
(“Escrow Agent”) pursuant to the escrow agreement between the Developer and
the Escrow Agent.
In June 2006, Union Labor loaned the Developer over $44,000,000 to
construct the project. The construction loan was secured by a first mortgage and a
collateral assignment covering all of the Developer’s assets, including all of the
Developer’s rights, title, and interests to deposits made pursuant to the sales and
purchase agreements. The construction loan was subsequently assigned to Union
Labor’s subsidiary, 300 South Duval, in late 2009.
In 2009, seventy-nine of the 100 contracted purchasers failed to close
(“defaulted purchasers”), and the Developer retained the defaulted purchasers’
deposits. Thereafter, the Broker informed the Developer that it (the Broker) was
entitled to a portion of the retained deposits for commissions due to the Broker for
the units that failed to close. Nonetheless, in July 2009, the Developer instructed
the Escrow Agent to release all of the retained deposits. As instructed, the Escrow
Agent released over $2,400,000 in retained deposits to the Developer.
On September 2, 2009, without the Broker’s consent, the Developer
transferred the $2,400,000 in retained deposits to Union Labor, and Union Labor
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applied the entire amount to the balance of the Developer’s construction loan. The
Broker demanded the payment of commissions due and owing under the listing
agreement for the units that failed to close, but the funds were not remitted to the
Broker.
Thereafter, the Broker initiated an action against the Lenders, with the
operative complaint asserting claims for unjust enrichment and conversion. The
claims were based on the Broker’s assertion that that it had an interest in a portion
of the retained deposits that were ultimately remitted to Union Labor without the
Broker’s consent.
The Broker and the Lenders filed competing motions for partial summary
judgment relating to which party had a superior legal interest in the retained
deposits. At a hearing conducted on the parties’ motions, the Broker argued that
the listing agreement identifies a particular fund for the payment of commissions
due to the Broker in the event that a closing fails to take place—the retained
deposits—and therefore, the Broker had an “ownership interest” in that portion of
the retained deposits. In contrast, the Lenders argued that the listing agreement did
not provide the Broker with an “ownership interest” in the retained deposits, and
therefore, the Lenders’ secured first priority interest in all of the Developer’s rights
and interest in deposits made pursuant to the sales and purchase agreements
controlled.
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At the conclusion of the hearing, the trial court entered final summary
judgment in favor of the Lenders and denied the Broker’s motion for partial
summary judgment. The trial court’s written order provides:
The Listing Agreement at issues gives [the Broker] no legal
ownership interest in any portion of the defaulted deposits as a matter
of law. Here, without such ownership interest in the deposits, [the
Broker] is, at best, a general unsecured creditor of its contracting
seller, and there can be no conversion or unjust enrichment claim
against [the Lenders], whose first priority interest in the deposits
extended to all deposits remitted to and owned by the Developer.
(citations omitted). The Broker’s appeal followed.
II. ANALYSIS
The Broker contends that the trial court erred by entering final summary
judgment in favor of the Lenders because, contrary to the trial court’s
determination, the listing agreement identifies a particular fund from which
commissions for units that failed to close are to be paid to the Broker—the retained
deposits—and therefore, the Broker had an “ownership interest” in the retained
funds. Because the issue before this Court is the interpretation of the listing
agreement, our review is de novo. See Real Estate Value Co. v. Carnival Corp., 92
So. 3d 255, 260 (Fla. 3d DCA 2012) (“The interpretation of a contract, including
whether the contract or one of its terms is ambiguous, is a matter of law subject to
de novo review.”).
The parties agree that if the listing agreement between the Broker and the
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Developer provides that the commissions due and owing to the Broker for the units
that failed to close are to be paid from a particular fund—the retained deposits—
then the Broker had an “ownership interest” in a portion of the retained deposits.
See Cohen Fin., LP v. KMC/EC II, LLC, 967 So. 2d 224 (Fla. 3d DCA 2007)
(holding that, because the brokerage agreement failed to identify a particular fund
from which the broker is to be paid his fee, the broker does not have a legal interest
in any specific fund); Riverland & Indian Sun L.C. v. L.J. Melody & Co., 879 So.
2d 1271, 1271-72 (Fla. 3d DCA 2004) (holding that the “the brokerage agreement
identified a particular fund to be set aside at the closing for the broker’s benefit”
where the brokerage agreement provides the fee due to the broker “will be paid by
wire transfer out of sale proceeds by the closing as a line item on the closing
statement,” and therefore, “the broker was clearly a named beneficiary of a
particular fund and, therefore, a constructive trust was alleged and the temporary
injunction was proper”); Campbell v. Pace, 369 So. 2d 413, 414 (Fla. 3d DCA
1979) (affirming imposition of constructive trust where the letter agreement
between the property owner and the brokers provided that the brokers would be
paid their commissions from a particular fund). Further, if the Broker had an
“ownership interest” in a portion of the retained deposits, the Lenders’ first priority
interest in the retained deposits did not extend to the portion of the retained
deposits in which the Broker had an “ownership interest.” Thus, as the trial court
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correctly found, if the Broker did not have an “ownership interest” in any portion
of the retained deposits, the Broker was, “at best, a general unsecured creditor of
its contracting seller, and there can be no conversion or unjust enrichment claim
against [the Lenders], whose first priority interest in the deposits extended to all
deposits remitted to and owned by the Developer.” (emphasis added).
The resolution of the issue before this Court is controlled by paragraphs 7(e)
and 7(g) of the listing agreement. Paragraph 7(e) sets forth when the Broker is
entitled to receive a commission for units that fail to close, and provides the
method for calculating the Broker’s commission on those units. Although the
calculation of the Broker’s commission is based, in part, on the amount of the
retained deposits—“Broker shall be paid a commission equal to one third of the
amount of the retained deposits less all collections expenses, but not to exceed the
full commission Broker would have earned” (emphasis added)—paragraph 7(e)
does not provide that the Broker’s commission is to be paid from the retained
deposits.
Therefore, standing alone, paragraph 7(e) does not identify a particular fund for the
payment of commissions due to the Broker for units that failed to close. However,
paragraph 7(g) of the listing agreement reflects that any unpaid commissions were
to be paid from two particular funds: (1) from unit closings when a unit closes,
or (2) as is relevant in the instant case, from retained deposits when a unit does
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not close.
We, therefore, conclude that the listing agreement clearly identifies a
particular fund for the payment of commissions due to the Broker in the event that
a unit fails to close—the retained deposits. Thus, the Broker had an “ownership
interest” in a portion of the retained deposits, and the trial court erred, as a matter
of law, by entering final summary judgment in favor of the Lenders. Accordingly,
we reverse the final summary judgment entered in favor of the Lenders, and
remand for further proceedings, including the consideration of the Lenders’ motion
for summary judgment based on its statute of limitations defense.
Reversed and remanded.
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