| Florida Court of Appeals |
| CASE NO. 97-4319 |
718 So.2d 390, 1998.FL.40086
|
October 14, 1998
|
GARY NEATE, APPELLANT,
v.
CYPRESS CLUB CONDOMINIUM, INC., A FLORIDA CORPORATION, APPELLEE. |
| 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. |
| The opinion of the court was delivered by: Farmer, J. |
| Appeal from the Circuit Court for the Seventeenth
Judicial Circuit, Broward County; Robert Lance Andrews, Judge; L.T. Case
No. 96-5752 (09). |
| EN BANC |
| 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. *fn1
See Ch. 91-103, § 10, at 739, Laws of Fla. |
| 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." *fn2
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. *fn3 |
| 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. |
| 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. |
| On appeal, we agreed that the dispute was covered by
the arbitration agreement. We then explained: |
| "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." |
| 677 So. 2d at 107. Section 682.03(3) is part of the
Florida Arbitration Code and provides that: |
| "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." |
| § 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. |
| 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). |
| 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. *fn4
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. |
| 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. |
| 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. *fn5 The
trial Judge dismissed the action for failing to make the timely filing. |
| 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. |
| 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. |
| 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. |
| 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. |
| 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. |
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.
|
AFFIRMED.
|
STONE, C.J., GUNTHER, WARNER, POLEN, KLEIN,
STEVENSON, SHAHOOD, GROSS and TAYLOR, JJ., concur.
|
DELL, J., recused.
|
NOT FINAL UNTIL THE DISPOSITION OF ANY TIMELY FILED
MOTION FOR REHEARING.
|
|
| Opinion Footnotes |
|
| *fn1 §
718.1255 Fla. Stat. (1989). |
| *fn2 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). |
| *fn3 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."). |
| *fn4 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. |
| *fn5 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). |
