| [1] |
Florida Court of Appeals |
| [2] |
CASE NO. 97-4319 |
| [3] |
718 So.2d 390, 1998.FL.40086 |
| [4] |
October 14, 1998 |
| [5] |
GARY NEATE, APPELLANT,
v.
CYPRESS CLUB CONDOMINIUM, INC., A FLORIDA CORPORATION, APPELLEE. |
| [6] |
Frank A. Luceri of Fried & Luceri,
P.a., Fort Lauderdale, for appellant. Peter S. Sachs, Spencer M. Sax and
Anthony K. Goodman of Sachs, Sax & Klein, P.a., Boca Raton, for
appellee. |
| [7] |
The opinion of the court was delivered by:
Farmer, J. |
| [8] |
Appeal from the Circuit Court for the
Seventeenth Judicial Circuit, Broward County; Robert Lance Andrews,
Judge; L.T. Case No. 96-5752 (09). |
| [9] |
EN BANC |
| [10] |
In 1991 the legislature found that
condominium unit owners were at a disadvantage when litigating against
their association and that the courts were becoming overcrowded with
condominium and other disputes. It thus concluded that the high cost of
litigation could be alleviated by requiring non-binding arbitration as a
precondition to suit in some condominium disputes. Accordingly it
rewrote section 718.1255.*X 1 See Ch. 91-103,
§ 10, at 739, Laws of Fla. |
| [11] |
The rewritten statute newly required that
disputes between a unit owner and condominium association involving the
authority of the board to require or forbid unit owners to take action
must first be submitted to non-binding arbitration before a lawsuit may
be filed. Section 718.1255(4)(a) states in part that: "[p]rior to
the institution of court litigation, a party to a dispute shall [e.s.]
petition the division for non-binding arbitration." *X
2 Equally important, it provides that the decision of the
arbitrators is final unless a party to the dispute files a complaint for
a trial de novo within 30 days after the arbitration decision has been
presented in writing. *X 3 |
| [12] |
In Blum v. Tamarac Fairways Ass'n, 684 So.
2d 826 (Fla. 4th DCA 1996), we reviewed a non-final order denying a
motion to dismiss for lack of jurisdiction. A condominium association
had sued to enjoin a unit owner from violating a provision of the
declaration of condominium. The unit owner sought to have the action
dismissed because it was filed without prior arbitration, contrary to
section 718.1255(4)(a). The owner argued that without a prior
arbitration the circuit court lacks jurisdiction of the suit. We
disagreed with the contention that the provision affected the
jurisdiction of the circuit court, and observed that section 718.1255
"provides for mandatory non-binding arbitration of `disputes'
between condominium unit owners and associations prior to the
institution of court litigation." 684 So. 2d at 827. |
| [13] |
In reversing the denial of the motion to
dismiss in Blum, rather than requiring a dismissal of the unauthorized
action without prior arbitration, we remanded with instructions that the
action be stayed pending the arbitration. We did not explain why a
stay-as opposed to a dismissal-was the proper remedy under section
718.1255 for filing suit without prior arbitration. Instead we simply
cited EMSA Limited Partnership v. Mason, 677 So. 2d 105 (Fla. 4th DCA
1996), without comment as the authority for a stay. EMSA involved a
dispute between contracting parties, employer and employee, over a
covenant not to compete. Their agreement also included a provision that
"any and all disputes" would be submitted to arbitration.
Without resorting to arbitration, the employer filed suit to enjoin a
breach of the covenant not to compete, and the employee responded with a
claim for damages. After the employer dropped its injunction claim, it
moved to dismiss the damages action on the grounds that the exclusive
remedy was through arbitration. The trial court denied the motion. |
| [14] |
On appeal, we agreed that the dispute was
covered by the arbitration agreement. We then explained: |
| [15] |
"There is authority holding that a
motion to dismiss is an appropriate vehicle for obtaining enforcement of
an arbitration clause. Florida Keys Elec. Coop. Ass'n. v. A & G
Blaton of Fla., Inc., 574 So.2d 1225 (Fla. 3d DCA 1991). We think,
however, the better view is to treat the motion as a motion to stay and
grant it pursuant to sections 682.02 and 682.03." |
| [16] |
677 So. 2d at 107. Section 682.03(3) is
part of the Florida Arbitration Code and provides that: |
| [17] |
"Any action or proceeding involving
an issue subject to arbitration under this law shall be stayed if an
order for arbitration or an application therefor has been made under
this section or, if the issue is severable, the stay may be with respect
thereto only. When the application is made in such action or proceeding,
the order for arbitration shall include such stay." |
| [18] |
§ 682.03(3), Fla. Stat. (1997). Because
the agreement between the parties contained an express agreement to
arbitrate all disputes, we therefore concluded that the Florida
Arbitration Code itself required that the action be stayed rather than
dismissed. |
| [19] |
There is no similar provision in section
718.1255 providing for such stays. In a statement of legislative intent
within the statute itself, subsection (3)(d) states that the "high
cost and significant delay of circuit court litigation . . . can be
alleviated by requiring [e.s.] non-binding arbitration and mediation in
appropriate cases." Subsection (4) of the statute is entitled:
"Mandatory [e.s.] non-binding arbitration and mediation of
disputes." Subsection (4)(a) states "[p]rior to the
institution of court litigation, a party to a dispute shall [e.s.]
petition . . . for non-binding arbitration." Our opinion in Blum
did not explain why, in light of these provisions in section 718.1255
and the absence of a stay provision comparable to section 682.03, an
unauthorized filing in court without prior arbitration should not be
dismissed. In later cases, we have simply cited Blum without comment.
See Summit Towers Condo. Ass'n v. Coren, 707 So. 2d 416 (Fla. 4th DCA
1998); Carlandia Corp. v. Obernauer, 695 So. 2d 408 (Fla. 4th DCA 1997). |
| [20] |
We read these provisions in section
718.1255 to create a condition precedent to filing an action in court,
and conclude that this condition precedent operates similarly to
comparable provisions in other statutes. For example in section 766.106
the legislature has required that an action for medical malpractice may
not be filed without giving prior notice to the health care provider. In
Williams v. Campagnulo, 588 So. 2d 982 (Fla. 1991), and Hospital Corp.
of America v. Lindberg, 571 So. 2d 466 (Fla. 1990), the court held that
the failure of the complaint in a medical malpractice action to allege
compliance with the statute providing for mandatory notice before filing
suit required a dismissal. *X 4 The court
likened the statute to the sovereign immunity statute requiring prior
notice as a condition precedent to filing the action. In Commercial
Carrier Corp. v. Indian River County, 371 So. 2d 1010 (Fla. 1979), and
Levine v. Dade County School Board, 442 So. 2d 210 (Fla. 1983), the
court had similarly held that dismissal was required where a claimant
fails to allege compliance with the sovereign immunity condition
precedent to suit. |
| [21] |
Although section 718.1255 deals with
arbitration rather than notice, we conclude that both are properly
conceived of as conditions precedent to filing an action in court. The
violation of a condition precedent to filing an action in court should
properly be a dismissal, not a stay. We therefore recede from Blum v.
Tamarac Fairways Ass'n, 684 So. 2d 826 (Fla. 4th DCA 1996); Summit
Towers Condo. Ass'n v. Coren, 707 So. 2d 416 (Fla. 4th DCA 1998); and
Carlandia Corp. v. Obernauer, 695 So. 2d 408 (Fla. 4th DCA 1997), to the
extent they are inconsistent with today's decision. Henceforth, actions
covered by section 718.1255 and filed without prior arbitration will be
subject to dismissal and will not be merely stayed pending statutory
compliance. |
| [22] |
As we have said, in today's case the
litigant filed an action without a prior resort to arbitration, and the
action was stayed while arbitration was had. The unit owner thereafter
failed to file a complaint for a trial de novo within 30 days after the
written arbitration decision was presented. *X 5
The trial Judge dismissed the action for failing to make the timely
filing. |
| [23] |
The unit owner argues that the pendency of
the stayed action demonstrates that he wanted a trial de novo. He
contends that he should not be punished [sic] for complying with the
stay. Arguing that the requirement for prior arbitration does not affect
the subject matter jurisdiction of the court, he points out that there
is a general policy favoring trials on the merits over procedural
Dispositions of claims. He also suggests that the legislative findings
in the 1991 rewritten statute demonstrate an important policy that the
statute be construed to reduce delay and attorney's fees in condominium
litigation and that he should thus be entitled to relax or even
disregard the 30-day requirement when he has (unauthorizedly) filed an
action without prior arbitration. He points out that the statute is
silent as to the circumstance presented here-a party fails to file a
complaint for a trial within 30 days after a written arbitration
decision has been presented while an unauthorized case was stayed. In
the end, he contends that the same considerations that led us to stay
unauthorized suits without arbitration should similarly lead us to
disregard his failure to file timely for trial after arbitration. We
disagree. |
| [24] |
The obvious intent of section
718.1255(4)(a), fully expressed by the legislature, is that no party may
commence an action in court on a dispute covered by the statute until
and unless arbitration has been had. As we earlier explained, the
requirement of prior arbitration is a condition precedent to any suit on
the dispute. Although in Blum we allowed unauthorized actions covered by
section 718.1255 to be stayed pending arbitration, rather than
dismissed, nothing in Blum suggested or implied that the stay would
relieve a party of filing a complaint for a trial de novo after the
arbitration decision was presented during the stay. |
| [25] |
A statute that clearly bars actions in
court without prior arbitration would hardly be served by allowing
unauthorized filings to be treated as statutory compliance when the
arbitration has finally been had only because the court refused to allow
the action to proceed without it. We are unable to treat the condition
requiring prior arbitration as a mere incantation on the way to trial.
Moreover section 718.1255(4)(k) expressly states that an arbitration
decision is final unless a party formally files a complaint for a trial
within 30 days afterwards. Giving the unauthorized filing the kind of
effect urged by the owner would cancel the statute's clear command that
the arbitration award be deemed final and binding unless one of the
parties acts within the stated period after arbitration to demand a
trial. |
| [26] |
There is nothing suggesting that the
legislature intended that the prior resort to arbitration be an empty
and mechanical ritual. The full text and structure of section 718.1255
evidence a purpose to make this alternative form of dispute resolution
effective-a real attempt to end the controversy then and there without
the necessity of another suit in court. It would all be quite pointless
if a party could ignore the prohibition on litigation without prior
compliance and file the suit anyway, and then after a stay ignore the
30-day requirement, yet nevertheless continue the suit long after the
arbitrator's award had become final. One who defies the statute and
files in court without first submitting the dispute to non-binding
arbitration should get no benefit from the prohibited filing of an
action without compliance with a statutory condition precedent to filing
suit. |
| [27] |
We therefore hold that a party to a
dispute covered by section 718.1255 who desires not to accept an
arbitrator's decision in a stayed, unauthorized action must still comply
with the statutory requirement and formally file a complaint in court
for a trial do novo within 30 days of the arbitrator's written decision.
Where the unauthorized action, as here, has been stayed and is thus
still pending, this compliance could be attached to a timely filed
motion for leave to amend the original complaint to show compliance with
section 718.1255. But nothing in the text of the statute suggests that
the pendency of a stayed, unauthorized action filed without arbitration
should be deemed as a sufficient demand for a trial de novo despite the
arbitrator's decision. |
| [28] |
Here the party did not do so, and the
trial court was therefore required to dismiss the action and enforce the
final decision by the arbitrator. |
| [29] |
AFFIRMED. |
| [30] |
STONE, C.J., GUNTHER, WARNER, POLEN,
KLEIN, STEVENSON, SHAHOOD, GROSS and TAYLOR, JJ., concur. |
| [31] |
DELL, J., recused. |
| [32] |
NOT FINAL UNTIL THE DISPOSITION OF ANY
TIMELY FILED MOTION FOR REHEARING. |
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Opinion Footnotes |
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| [33] |
*X 1 § 718.1255
Fla. Stat. (1989). |
| [34] |
*X 2 The statute
was later amended without substantial change to these provisions. See
Ch. 97-301, § 2, at 5425, 5427, Laws of Fla., and § 718.1255(4)(a) and
(k), Fla. Stat. (1997). |
| [35] |
*X 3 See §
718.1255(4)(k), Fla. Stat. (1997) ("An arbitration decision is also
final if a complaint for a trial de novo is not filed in a court of
competent jurisdiction in which the condominium is located within 30
days."). |
| [36] |
*X 4 In
Lindberg, the court made clear that the dismissal need not be with
prejudice where the complaint could be amended to allege compliance
within the applicable limitations period. |
| [37] |
*X 5 The written
arbitration decision was presented on May 14th, but the owner did not
file a motion to amend his complaint in the stayed action until
September 5th. On July 3rd the owner had filed a notice in the trial
court attaching a copy of the arbitrator's decision, along with a motion
to lift the stay. Apart from the fact that the July 3rd notice and
motion failed to contain any complaint for a trial de novo, or request
for leave to amend the complaint to allege compliance with section
718.1255(4)(k), this too was also filed outside the 30-day requirement
of section 718.1255(4)(k). |
