Suffolk Construction lost a breach-of-contract lawsuit in July with the bond of a former drywall subcontractor, but the contractor’s payout could increase dramatically if the presiding U.S. District Court judge in Miami allows the insurer to collect another $3 million in requested attorneys’ fees and trial costs.
Berkley Insurance Co., which prevailed against Suffolk in the civil suit, is now seeking potential judgment costs that will add millions to the base $4.1 million in damages owed to it by the contractor.
Most states, including Florida, require each party to a civil lawsuit to pay its own attorneys’ fees and court costs. But Florida also makes an exception if a contract between the plaintiff and the defendant provides for the winning party to recover court costs or the case is decided based on state law that provides for the winning party to recover those costs.
Charles Comella Jr., an associate attorney at the law firm Chesser & Barr, wrote earlier this year that determining the winner in a civil lawsuit is not so simple because it often involves several different claims and the parties may win some of them. but not others.
“It may not be clear which party should be considered the dominant party,” he wrote.
One way to collect attorneys’ fees is if the plaintiff, in his opening brief, explicitly seeks the fees and if the judge decides that one party “prevailed on the more important issue or issues,” Comella wrote.
The Met Square project dispute
The dispute between Suffolk and Berkley involves a five-year dispute over payments that drywall subcontractor Titus Construction Group said was owed on a high-rise, mixed-use project in Miami called Met Square. The federal judge in July ordered Suffolk to pay Berkley $4.1 million plus $1.2 million in prejudgment interest.
Typically, a surety indemnifying a contractor can make claims for the contractor and collect any money owed to the contractor while seeking to recover its own costs.
Suffolk attorneys described Fort Lauderdale-based Titus Construction, a framing, insulation and drywall contractor, as insolvent.
There was no response for the ENR story that published the time to calls to its Fort Lauderdale phone list or to responses from two attorneys representing the company.
Berkley had sued Suffolk for breach of contract in 2019, alleging the contractor owed Titus money for his work at Met Square.
The matter was decided in Berkley’s favor after a non-jury trial in November 2023. In her verdict for Berkley, Judge Kathleen Williams cited a lack of evidence regarding Suffolk’s disputed schedules.
Berkley is now seeking $2.1 million in attorney fees and expert witness fees, in addition to damages and interest, according to a motion filed by the bond in September.
Seven attorneys who worked on the case earned $225 to $250 an hour each, and paralegals earned $125 an hour, Berkley reported in his motion for costs.
Berkley is seeking $501,000 for expert testimony, with the firm and Titus also seeking an additional $391,000 for “database services” related to the production of necessary documents, with another $15,000 for technology needed to manage the case and documents, and another $15,000 for travel costs. of lawyers and witnesses.
Suffolk wins in previous lawsuit
Suffolk has asked Judge Williams to offset the costs of his losing verdict, when it’s over, with the amount he was awarded in a separate state circuit court case in Miami-Dade County.
Titus sued Suffolk in that case, blaming it for cost overruns and delays in a $1.9 million drywall subcontract awarded in 2016 for work on the Miami Central Overbuild, a high-rise offices built over the main Brightline train terminal. A judge in March 2023 ordered Titus to pay Berkley $7.7 million.
This verdict was entered as a default judgment, meaning that Titus, who was the plaintiff, did not proceed with its claims against Suffolk or defend against the contractor’s counterclaims.
To ease some of the financial sting of the federal court verdict, Suffolk wants Judge Williams to allow him to deduct whatever the company ultimately owes Berkley from what Titus owed the contractor in the state court case.
While Suffolk argues for compensation, Berkley argues that it deserves all attorneys’ fees and court costs.
This particular argument hinges on some legal twists and turns.
Berkley notes that Titus’ subcontract with Suffolk required the subcontractor to pay attorney fees and trial if the contractor prevailed in a legal dispute. But Berkley said Florida statutes require that any contract with such a one-way provision be automatically construed as a two-way obligation. Berkley also claims it is entitled to court costs and attorney fees under its bond agreement with Titus.
“The court rejected all of Suffolk’s defenses and sought to reduce Titus’ damages amounts,” Berkley argues, “There is no way to describe the outcome of this case other than a complete victory” for the surety and Titus .
A final decision by the judge on both final court costs and whether the compensation can be used is still likely to be weeks or months away.
