Just because You Recovered an Affirmative Judgment does NOT Mean you Are the Prevailing Party for Purposes of Attorney’s Fees
The prevailing party in a litigation for purposes of being awarded attorney’s fees is NOT determined by how the money flows at the conclusion of the litigation. In other words, just because you recovered an affirmative judgment does NOT mean you are the prevailing party for purposes of being entitled to attorney’s fees. See Skylink Jets, Inc. v. Klukan, 45 Fla.L.Weekly D2829a (Fla. 4th DCA 2020). To be the prevailing party for purposes of being entitled to attorney’s fees, a party must have prevailed on the significant issues in the litigation. Id. And a trial court has broad discretion to determine which party is the prevailing party or that neither party is the prevailing party. Id. (Based on this discretion, an appellate court reviews a trial court’s ruling on entitlement to attorney’s fees under an abuse of discretion standard of review. Id.)
In Skylink Jets, an air carried hired a pilot. In doing so, the parties entered into a personal loan agreement and a pilot training expense agreement. The loan agreement was for flight training paid by the carrier which would be forgiven if the pilot worked for the air carrier for two years. The pilot training expense agreement required the air carrier to pay for other pilot training expenses but that the pilot would have to reimburse the air carrier if he quit or was terminated by a set date. This agreement stated prior contracts were null and void.
The pilot resigned during his repayment period. After resignation, he flew four additional flights thinking part of his debt would be repaid by these flights and he was never paid by the carrier for these flights.
Later, the air carrier sued the pilot for reimbursement and asserted claims under both the personal loan agreement and the pilot training expense agreement. After a bench trial, the court ruled in favor of the carrier that the pilot breached the pilot training expense agreement. The court ruled against the carrier under the personal loan agreement because of language in the pilot training expense agreement that voided prior agreements. The court also ruled against the air carrier on an unjust enrichment count and two other related counts. Based on the court’s ruling, the air carrier was awarded less than half of its claimed damages because the court only awarded damages under the pilot training expense agreement, less a credit for the four additional flights post-resignation the pilot flew for the carrier to repay debt. The carrier then moved for its attorney’s fees as the prevailing party.
The trial court, affirmed on appeal, denied the air carrier’s attorney’s fees finding that the carrier did not prevail on the significant issues in the case. The carrier did not prevail on the significant issues because it did not prevail under the unjust enrichment claim, did not prevail on the personal loan agreement, did not recover damages under the personal loan agreement, and recovered damages less than half of what it sought. (The air carrier also did not prevail on two other counts.). Even though the carrier prevailed on the pilot training expense agreement, the court found this was not a significant issue in the litigation because the pilot admitted he had not reimbursed the carrier.
[W]e hold that the trial court did not abuse its discretion in finding that [the air carrier] was not the prevailing party under the circumstances of this case. [The carrier] failed to prevail on four out of five of its counts and only partially prevailed on Count I [breach of the pilot training expense agreement]. Although [the carrier] prevailed on an issue of liability as to Count I, it was an issue that was not seriously contested and thus was not a significant issue in the litigation. [The pilot] largely prevailed on the significant issue of damages by defeating most of [the carrier’s] claimed damages, making the case a wash.
Skylink Jets, supra.
This case typifies quite a bit of subjectivity that goes into determining whether a party prevailed on the significant issues in a case. Regardless of the air carrier losing on most counts, it prevailed on the breach of the pilot expense training agreement that contained the attorney’s fees provision. The court did not deem this portion of the dispute to be a significant issue simply because the pilot admitted from the get-go he had not reimbursed the carrier under the agreement and left during the repayment period. But, in my opinion, this overlooks a fundamental point. The pilot admitted he owed money but never tendered such money to satisfy the reimbursement he agreed to pay if he left the carrier before a set date. Determining this as not a significant issue merely rewards the pilot for breaching the agreement and not paying seemingly because he admitted he did not reimburse the carrier.
Please contact David Adelstein at firstname.lastname@example.org or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.