STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CREATIVE DESIGNS AND INTERIORS, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 89-0894F

)

DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

FINAL ORDER

Pursuant to notice, the above-styled matter was heard before the Division of Administrative Hearings by its duly designated Hearing Officer, Don W. Davis, on April 6, 1989 in Tallahassee, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: Douglas Reynolds, Esquire

Savings of America Building, 10th Floor 4875 North Federal Highway

Fort Lauderdale, Florida 33308

For Respondent: Charles Gardner, Esquire

Haydon Burns Building

605 Suwannee Street, Mail Station 58

Tallahassee, Florida 32399-0458 BACKGROUND

By application dated February 22, 1989, Creative Designs and Interiors, Inc., Petitioner in the Division of Administrative Hearings Case 88-0778T, seeks attorneys' fees and costs as the prevailing party in that proceeding pursuant to Section 57.111, Florida Statutes. By final order dated December 26, 1988, Respondent adopted the recommended order issued in that case and granted Petitioner an award of relocation expense in the amount of $1,035.00.

At issue in this proceeding is whether Petitioner was the prevailing party in the previous action and therefore entitled to attorney's fees and costs in the absence of substantial justification of Respondent's previous denial of relocation benefit payments or other considerations which would prevent such an award.

At hearing, Petitioner presented the testimony of one witness and seven evidentiary exhibits. Respondent presented the testimony of one witness and three evidentiary exhibits. Proposed findings of fact submitted by Petitioner are addressed in the appendix to this final order. Respondent did not timely file proposed findings of fact.

Based upon all of the evidence, the following findings of fact are determined:

FINDINGS OF FACT

1. Petitioner is a small business party within the meaning of Subsection 57.111(3)(d), Florida Statutes (1987).

   
   

2. Petitioner was required to relocate its business in 1986 as the result of a public taking of the property where the business was situated. Petitioner sought relocation benefits from Respondent's relocation assistance program. The program is operated by Respondent in accordance with authority contained in Sections 339.09(4) and 421.55(3), Florida Statutes.

   
   

3. Various requests by Petitioner for payment of relocation benefits in accordance with the Uniform Relocation Act were denied by Respondent. In DOAH Case No. 88-0778T, Petitioner sought a formal administrative hearing pursuant to Section 120.57, Florida Statutes concerning Respondent's denial of the requested reimbursements.

   
   

4. At the final hearing in DOAH Case No. 88-0778T, evidence was presented regarding Respondent's denial of benefit payments of $1,324 for advertisement expense in a telephone directory; $1,370 for installation of an exhaust fan at the new facility; $2,405 for fees for consultative services from an attorney;

   $1,200 for the alleged loss of employee time spent in conferences with Respondent personnel regarding relocation; $1,500 for expense of a second search for a suitable relocation site; and $1,035 for consultation fees associated with design of a product display area in the new facility. With the exception of Respondent's denial of the claim for $1,035 for consultant fees, Respondent's denials were found to be appropriate in DOAH Case No. 88-0778T. Such a finding of appropriateness also equates to a finding of substantial justification for denial for purposes of this proceeding.

   
   

5. A recommended order was issued in DOAH Case No. 88-0778T, finding denials of all requested reimbursements to be appropriate with the exception of Respondent's denial of the request for $1,035 for consultation fees associated with design of a product display area. Payment of this latter amount was recommended as constituting an authorized reimbursement under legal provisions governing the relocation program. On December 26, 1988, Respondent entered a final order awarding Petitioner $1,035 for this consultation fee expense.

   
   

6. Other claims for reimbursement by Petitioner in the amount of

   $10,414.17 were paid by Respondent, prior to the final hearing in DOAH Case No. 88-0778T, in the course of proceedings in the Circuit Court for Broward County, Florida. That court adopted a settlement stipulation of the parties regarding those claims which expressly reserved attorney fees in regard to those issues for later determination by that court. Petitioner presented no evidence with regard to those claims at the final hearing in DOAH Case No. 88-0778T. At the final hearing in the present proceeding, Respondent offered testimony that confusion concerning payment of those claims resulted from the death of the attorney handling the case for Respondent. Respondent initially denied the claims in the absence of the deceased attorney's records in the mistaken belief that the matter had been resolved earlier in the circuit court condemnation proceeding. Upon learning such was not the case, payment of the claim and effectuation of settlement of the issue was made in the circuit court case and occurred shortly after Petitioner's request for hearing in DOAH Case No. 88- 0778T. The circumstances surrounding the initial denial of payment of this

   benefit by Respondent substantially justify Respondent's denial and constitute a sufficient basis to deny Petitioner's recovery of fees or costs related to this payment recovery in this administrative proceeding.

   
   

7. The proof submitted at the final hearing in this cause establishes that Petitioner's counsel expended between 55 and 70 hours of time in his representation of Petitioner's attempts to recover all denied benefits in DOAH Case No. 88-0778T. Counsel's average hourly rate was $125. However, the fee arrangement between client and counsel was a "modified or combined contingency fee" permitting any recoverable attorney fees to serve as the primary source of payment of counsel's fees. Petitioner was not bound by the agreement to pay counsel's fees beyond amounts determined to be appropriate by the hearing officer in the administrative case or the judge in the circuit court matter. To that extent, attorney fees in this cause that have been incurred by Petitioner may be considered "contingent."

   
   

8. Documentation submitted by Petitioner includes an affidavit from its president which simply recites the status of Petitioner as a small business party, but sets forth no specifics of a fee arrangement with counsel. The affidavit of Petitioner's counsel establishes a minimum number of hours (55) and dates of work performed by counsel, and states that his hourly rate is $125. Calculating the number of hours by the hourly rate, one reaches a total fee amount of $6,875. Counsel's affidavit does not address which of the various benefits sought to be recovered was the subject of any particular expenditure of time. Although the relocation benefits sought to be recovered were separable subjects, allocation of time expended with regard to a particular benefit recovery effort is not established by the evidence.

   
   

9. Testimony of William Robert Leonard was also offered by Petitioner to support the reasonableness of a legal fee amount of $10,000 for Petitioner's counsel. While Mr. Leonard opined that he normally would not support a $10,000 attorney fee as reasonable for a $1,000 recovery, the circumstances of this case were different because "[y]ou are arguing with the state." Petitioner attempted to establish through further testimony of Leonard that the enormity of the resources of the government of the State of Florida justify such a fee because cost considerations prevent private litigants from engaging in costly and protracted proceedings in matters of limited recovery. Leonard did not address allocation of the requested attorney fee among the various benefits for which recovery was sought, choosing instead to premise his opinion regarding reasonableness of a $10,000 attorney fee upon "the amount of time counsel was required to respond to a state agency." Leonard's testimony is not credited with regard to reasonableness of a $10,000 fee for recovery of the $1,035 relocation benefit due to his professed lack of knowledge of certain administrative law procedures; the failure of his testimony to address the nature or difficulty of tasks performed by counsel for Petitioner; and his concurrence with the assertion that his opinion of such a fee was based in part upon a "gut reaction." No evidence was submitted to support the reasonableness of the cost amount of $250 requested as a witness fee for Mr. Leonard's participation in the proceeding.

   
   

10. Petitioner seeks recovery of $448.50 in costs associated with the transcript of final hearing had in DOAH Case No. 88-0778T and a $480 expert witness fee in conjunction with testimony of E. Scott Golden, an attorney, at that final hearing. The testimony of Mr. Golden in that proceeding related to his provision of relocation site advice to Petitioner and drafting of legal documents for Petitioner. Petitioner did not prevail with regard to recovery of relocation benefits related to the expense of Mr. Golden's services.

    CONCLUSIONS OF LAW

    
    

11. The Division of Administrative Hearings has jurisdiction over the subject matter of this proceeding, and the parties thereto, pursuant to Subsection 120.57(1), Florida Statutes.

    
    

12. In accordance with Section 57.111, Florida Statutes, Petitioner may be entitled to recovery of attorney fees and costs, provided Petitioner is a small business party which prevailed in DOAH Case 88-0778T. Petitioner's status as a small business party is undisputed.

    
    

13. At issue is whether Petitioner is a "prevailing small business party" within the confines of Subsection 57.111(3)(c), Florida Statutes, which reads as follows:

    
    

    (3)(c) A small business party is a "prevailing small business party" when:

    1. A final judgement or order has been entered in favor of the small business party and such judgment or order has not been reversed on appeal or the time for seeking judicial review of the judgment or order has expired;

    2. A settlement has been obtained by the small business party which is favorable to the small business party on the majority of issues which such party raised during the course of the proceeding; or

    3. The state agency has sought a voluntary dismissal of its complaint.

       
       

14. The nomenclature of "prevailing party" is applicable to Petitioner only if a final judgement or order has been entered in "in favor" of Petitioner. Petitioner sought recovery of six different benefit payments, in varying amounts, which had been denied by Respondent in DOAH Case No. 88-0778T.

    
    

15. Petitioner's efforts were successful with regard to only one benefit payment in the amount of $1,035 or less than 12 percent of the desired total amount of benefit payments of $8,834. This total amount of recovery sought is exclusive of the claims for $10,414.17 settled in the circuit court at the election of Petitioner under circumstances that substantially justified Respondent's initial denial. Notably, that settlement and election also reposed authority for any attorney fee determination as to those claims in the circuit court. Inclusion of that amount within the total recovery sought by Petitioner drops the percentage of recovery to approximately five percent of the total recovery sought.

    
    

16. However, with regard to that one relocation benefit, Petitioner was the "prevailing small business party". To adopt an "all or nothing" approach, as suggested by Respondent, would place form over substance and could lead to anomalous results. See, Gentele v. Department of Professional Regulation, DOAH Case No. 85-3857F (Final Order entered June 20, 1986).

    
    

17. Normally, in the absence of substantial justification of Respondent's denial action or existence of special circumstances making an award unjust, Petitioner is entitled to an award of that portion of the attorney's fees and

    costs attributable to that result. Section 57.111(4)(a), Florida Statutes. However, Petitioner must also submit an itemized affidavit revealing the nature and extent of the services rendered by counsel.

18. Section 57.111(4)(b)1., Florida Statutes, reads as follows: (b)1. To apply for an award under this

    section, the attorney for the prevailing small

    business party must submit an itemized affidavit to the court which first conducted the adversarial proceeding in the underlying

    action, or to the Division of Administrative Hearings which shall assign a hearing officer, in the case of a proceeding pursuant to chapter 120, which affidavit shall reveal the nature and extent of the services rendered by the attorney as well as the costs incurred in preparations, motions, hearing and appeals

    in the proceeding. (emphasis supplied.)

    
    

19. While the affidavit submitted in this cause determines the extent of services rendered by counsel in terms of time, no determination can be made as to the nature of the services in that the affidavits and other evidence submitted fail to detail time expended with regard to the specific benefit payment sought to be recovered.

    
    

20. While not unmindful of the court's decision in Glades, Inc. v. Glades Country Club Apts. 534 So.2d 723 (Fla. 2nd DCA 1988), that a finding of the number of hours reasonably expended by an attorney need not necessarily include specific, written time records in documentation of those hours, the jurisdictional aspects of Section 57.111(4)(b), Florida Statutes must be considered in the context of this administrative proceeding. Fiat Motors of North America, Inc. v. Calvin 356 So.2d 908 (Fla. 1st DCA 1978). Without an attorney's affidavit that details "the nature" as well as the extent of services rendered, the application is not valid. To determine otherwise, particularly in the absence of any other evidence detailing the nature of time expended, would be an attempt to enlarge the statutory jurisdiction accorded the hearing officer. Unlike a court of equitable jurisdiction, the Division of Administrative Hearings is a creature of statute and has only such powers as the statute may confer. State ex rel. Greenburg v. Florida State Board of Dentistry

297 So.2d 628 (Fla. 1st DCA 1974), cert. dismissed, 300 So.2d 900 (Fla. Sup. Ct. 1974).

Based on the foregoing findings of fact and conclusions of law, it is Ordered that the application of Petitioner for attorney's fees and costs be

denied.

DONE AND ORDERED this 18th day of May, 1989, in Tallahassee, Leon County, Florida.

DON W. DAVIS

Hearing Officer

Division of Administrative Hearings The DeSoto Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904)488-9675

Filed with the Clerk of the Division of Administrative Hearings this 18th day of May, 1989.

APPENDIX

The following constitutes my specific rulings, in accordance with section 120.59, Florida Statutes, on findings of fact submitted by the parties.

Petitioner's Proposed Findings.

1.-5. Addressed with exception of last sentence of paragraph 5 which is rejected as unnecessary.

1. Addressed.

2. Testimony of Mr. Leonard does not support reasonableness of a $10,000

fee.

8.-12. Rejected as not necessary to conclusion.

COPIES FURNISHED:

Charles Gardner, Esq. Haydon Burns Building

605 Suwannee Street, M.S. 58

Tallahassee, FL 32399-0458

Douglas Reynolds, Esq.

Savings of America Building, 10th Floor 4875 North Federal Highway

Fort Lauderdale, FL 33308

Thomas H. Bateman, III, Esq. General Counsel

Department of Transportation

562 Haydon Burns Building Tallahassee, FL 32399-0450

Hon. Kaye N. Henderson Secretary

Haydon Burns Building

Attn: Eleonor F. Turner, M.S. 58 605 Suwannee Street

Tallahassee, FL 32399-0450

NOTICE OF RIGHT TO JUDICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE DIVISION OF ADMINISTRATIVE HEARINGS AND A SECOND COPY, ACCOMPANIED BY FILING FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR WITH THE DISTRICT COURT OF APPEAL WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

Docket for Case No: 89-000894F

Orders for Case No: 89-000894F