Wednesday, December 30, 2009

Third District Grants Certiorari In Favor Of Comity And Sergei Federov

In Sergei V. Fedorov v. Citizen's State Bank (3D09-2800),  the Third District granted Sergei Federov's petition for certiorari because the "orders below would result in a material injury that cannot be corrected on appeal and that the lower court departed from the essential requirements of law."

Essentially, "Fedorov sought a stay on the ground that Citizens State Bank filed an earlier action in Michigan involving the same parties and substantially the same issues, and the Michigan case will decide all or substantially all of the issues in this action....Fedorov contends that he will be materially or irreparably harmed if he is forced to litigate the same case in two separate states."
It is well settled in Florida that “‘causes of action do not have to be identical’ to require a stay of the second-filed action,” and “[i]t is sufficient that the two actions involve a single set of facts and that resolution of the one case will resolve many of the issues involved in the subsequently filed case.”...A trial court has broad discretion to order or refuse a stay of an action pending before it; nonetheless, it is an abuse of discretion to refuse to stay a subsequently filed state court action in favor of a previously filed action which involves the same parties and the same or substantially similar issues....“This rule is based on principles of comity.

Monday, December 28, 2009

Florida Supreme Court Orders Mediation For All Residential Foreclosures

Florida Supreme Court Chief Justice Peggy Quince entered an order relating to residential foreclosures. The order requires, among other things, a mediation for all residential foreclosures. The order can be viewed on the Florida Supreme Court's web site at THIS link.

Florida Chief Financial Officer, and candidate for Governor, "commended the Florida Supreme Court order recommending a statewide managed mediation program for Florida’s homeowners." The entire press release can be found at THIS link.

An article in the Palm Beach Post THIS link. The article quotes Sharon Bock, Palm Beach County's comptroller and clerk of court. The following is a quote from the article:
Sharon Bock, Palm Beach County's comptroller and clerk of the circuit court, said she's concerned that while it may alleviate judge workload, it could increase paperwork for her employees.

Foreclosure mediation has been optional in Palm Beach County for at least a year. Bock believes mandatory mediation isn't a role the court should play.

"This process moves the courts from calling balls and strikes, from creating a level playing field, into the realm of a social service agency, picking sides," she said.
The Florida Supreme Court's Administrative Order is below:
Florida Supreme Court Foreclosure Administrative Order (AOSC09-54)

The Task Force that led to the entry of the Administrative Order was discussed HERE.  Some of the mandatory foreclosure programs throughout the state were discussed on April 25, 2009 HERE.  Additionally, the Florida Supreme Court released the 2008-2009 foreclosure statistics were I recently posted HERE.

Wednesday, December 23, 2009

Reversal Of Order Denying Protective Order Over Privileged Information "Interests Of Justice Require" It

In Nova Southeastern University, Inc. v. Jacobson (4D09-683), the Fourth District granted Nova's Petition for Certiorari and quashed the trial court's order requiring disclosure of a letter protected by the attorney client privilege.  The interests of justice required counsel for the plaintiff below to disclose the fact that they had the letter.  The court stated:
Jacobson, was an Associate Director at the University School Middle School of Nova....Jacobson was being deposed on February 13, 2008, when she testified that in June 2005 she was at the fax machine at the middle school receiving some papers on an insurance claim for her son. Mixed in with some insurance company papers was a letter from Nova’s law firm to the head master of the school, the human resources department and the director of the middle school. She read the letter, which stated that the university “did not have enough performance issues to fire me, and that it would have to be a business decision whether I was going to remain an employee of NSU.” Counsel for Nova said at the deposition that he was recording his objection to the letter as attorney-client privilege, noting that “it was obviously communicated accidentally.” No letter was produced at the time of the deposition.
Nova moved for a protective order in May 2008 to prevent Jacobson from referring to the letter, because it was protected by attorney-client privilege. At the time of the filing of the motion, Nova did not know that Jacobson had retained a copy of it....At the hearing, Nova filed affidavits from each of the persons to whom the letter was sent, indicating that they did not intend for third persons to see the communication. Further underscoring the letter’s confidentiality, counsel produced a cover sheet which had accompanied the faxed letter, which stated that the attached communication was protected by attorney-client privilege.
As we said in BNP Paribas v. Wynne, 967 So. 2d 1065, 1067 (Fla. 4th DCA 2007), “[t]h e attorney-client privilege is the oldest confidential communication at common law and . . . is ‘traditionally deemed worthy of maximum legal protection.’”...The privilege belongs to the client, see Neu v. Miami Herald Pub. Co., 462 So. 2d 821, 825 (Fla. 1985), and may be claimed by the client or the lawyer on behalf of the client.
Closer to these facts are those cases involving overheard conversations, where the client knew or should have known that the conversation was overheard by a third person....In such cases, the courts have held that where the communication is made in the presence of others, it does not evince an intent to keep the conversation confidential, and the privilege is lost....Nevertheless, the fact determination in the overheard conversation cases is similar to the first step of the Abamar/McGee inquiry regarding the reasonableness of the precautions to prevent inadvertent disclosure. Therefore, despite the factual difference, we apply the relevant circumstances test.
Where the party who inadvertently produced the documents objects or demands return of the documents as soon as the disclosure is discovered, the party has not unduly delayed seeking measures to rectify the inadvertent disclosure.....These cases show that it is the assertion of the privilege at the earliest time through objection or motion which is the important measure in evaluating efforts to rectify the disclosure. It is not the delay in securing hearing time. In failing to recognize that the timely assertion of an objection constituted an appropriate measure to rectify the inadvertent disclosure, the court departed from the essential requirements of law. Furthermore, Nova’s trial counsel did not know that Jacobson had a copy of the letter at the time the depositions proceeded. Nova’s attorney could not have moved to exclude what h e did not know was in possession of his opponent.
The overriding interests of justice support returning the letter to Nova, if it is determined that the attorney-client privilege was not waived by the method of its delivery by fax. Jacobson’s attorney clearly had to know that the letter was intended to be a confidential communication in that it provided legal analysis regarding the Nova/Jacobson employment relationship. The Rules of Professional Responsibility require that he notify the other attorney of this inadvertent disclosure. See Fla. R. Prof. Conduct 4-4.4(b) (“A lawyer who receives a document relating to the representation of the lawyer’s client and knows or reasonably should know that the document was inadvertently sent shall promptly notify the sender.”). Instead of following the rule, this attorney held onto the letter for years. The interests of justice require that the Rules of Professional Responsibility be honored. Because the trial court departed from the essential requirements of law in evaluating the relevance test factors for waiver of attorney-client privilege based upon inadvertent disclosure, we remand for the trial court to conduct a new hearing on the issue.

Certiorari Denied In Attempt To Abate Chinese Drywall Case

In Banner Supply Company v. Harrell (3D09-2165), the Third District denied a petition for certiorari filed by a party seeking to abate a Chinese drywall case.  The petitioners argued that the plaintiff below failed to comply with sections 558.001–005, Florida Statutes which states "A claimant may not file an action subject to this chapter without first complying with the requirements of this chapter."  The court stated:
The claimants below (“Harrells”) filed the initial complaint on February 3, 2009, as a putative class action suit seeking damages allegedly arising out of construction using defective drywall imported from China...Although Chapter 558 does not apply to claims for personal injury, the Harrells simultaneously served Banner with a letter advising it of notice of claim under Chapter 558 of the Florida Statutes. On March 17, 2009, the Harrells filed an amended complaint asserting a claim for property damage due to the alleged defective drywall, to which Chapter 558 does apply. Banner Supply filed a motion to abate pursuant to Chapter 558, which was denied by the trial court judge.
The record shows that the Harrells failed to follow the statutory requirements of notice and opportunity to inspect prior to filing suit.  They gave separate “notice” at time of filing the initial complaint, which claims were not subject to Chapter 558. Although the Harrells invited inspection, Banner Supply did nothing to attempt to comply with the noticed statute and to inspect the property. Forty-two days later, the Harrells amended their initial complaint to include a claim for property damages due to the alleged defective dry wall thereby invoking Chapter 558, but without giving the statutorily required sixty days notice prior to filing the amended complaint. Banner Supply, again, did nothing to comply with Chapter 558 in response to the amended complaint. It did not seek to inspect or negotiate a resolution. All it did was file a motion to abate and wait until the hearing.
The real problem with the petition, according to the court:
By the time Banner’s motion to abate was heard by the trial court on July 1, 2009, more than sixty days had passed since the amended complaint was filed and the trial court determined, and we agree, that abatement would have been futile.  Banner Supply had the opportunity to comply with the requirements of Chapter 558 and was given the opportunity by the Harrells to timely inspect and it chose not to do so. Abatement, at that point, would have been futile.

Amended Opinion, Same Result: Reversal Of $24,170,000.00 Asbestos Judgment Against Honeywell

On October 28, 2009, the Third District released an opinion reversing a $24,170,000.00 against Honeywell.  The original opinion was discussed HERE.  Today, the original opinion was withdrawn and a new opinion in Honeywell International, Inc. v. Guilder (3D08-1747).  The new opinion reaches the same result, the judgment was reversed.
On appeal, among others errors, Honeywell asserts the trial court erred in: (1) admitting the irrelevant, highly prejudicial letter; (2) excluding Fabre defendants from the verdict form; and (3) awarding Guilder’s children loss of parental consortium. Honeywell further asserts that it is entitled to a setoff reflecting the appropriate percentage of economic damages received from Guilder’s settlement with co-defendants.
On the other hand, Guilder contends that: (1) the letter was relevant, and not unduly prejudicial, or inflammatory; (2) the Fabre defendants were properly excluded from the verdict form; and (3) the loss of parental consortium award was proper. Guilder further contends that Honeywell is not entitled to setoff from any portion of the verdict. We agree with Honeywell.

Did President Nixon's Use Of Helipad Convert Use Of Helipad Into Legal Use Of Land?

In United Real Estate Ventures, Inc. v. Village of Key Biscayne, Florida (3D09-1191), the Third District held the code compliance board and the circuit court did not violate the defendant's due process rights and the court affirmed the decision below.  At issue, whether that fact that President Nixon used a helipad in a certain area allowed a private citizen to use the area for a helipad after the federal government sold the property.  The court stated:
The federal use of the helipad by President Nixon’s administration was immune from enforcement by reason of the supremacy clause of the United States Constitution and was not conformed into a legal non-conforming use for private individuals when the federal government ceased to use the helipad and conveyed the property to a private third party. See Alaska R.R. Corp. v. Native Village of Eklutna, 43 P. 3d 588 (Alaska 2002); Nolan Bros. v. City of Royal Oak, 557 N.W. 2d 925 (Mich. Ct. App. 1996).

Tuesday, December 22, 2009

Debtor's Keogh Plan Exempt In Bankruptcy Under § 222.21(2)(a)(1), Florida Statutes

In In re Baker: Baker v. Tardif (09-13144-HH), the Eleventh Circuit released a published decision and reversed the decision of the Bankruptcy Court and the District Court. The Eleventh Circuit held that the debtor's Keogh plan was exempt under Florida law. Fla. Stat. § 222.21(2)(a)(1).

The bankruptcy court concluded that Baker could not claim the exemption under section 222.21(2)(a)(1) because she was the “sole shareholder and sole ‘participant’ in the Keogh plan.”  The Opinion notes:
After a debtor files for bankruptcy, she is entitled to retain certain assets as exempt from the bankruptcy estate. Although the bankruptcy code provides exemptions, a state may opt out of those exemptions and provide alternative exemptions. 11 U.S.C. § 522(b).
Florida law shields from the claims of creditors some assets deposited in retirement and profit-sharing plans. Section 222.21 exempts from the bankruptcy estate money, assets, and any interest in a plan in which the debtor is an owner, participant, or beneficiary and that has been preapproved by the Internal Revenue Service as exempt from taxation under section 401(a) of the Internal Revenue Code.
The district court ruled that Baker’s Keogh plan had to be maintained under the Employee Retirement Income Security Act for Baker to claim an exemption under section 222.21(2)(a)(1), but we disagree.
In 2005, the Florida Legislature amended section 222.21 to provide that an exempt plan does not have to comply with the Employee Retirement Income Security Act....We reverse the judgment that Baker’s Keogh plan had to comply with the Employee Retirement Income Security Act to qualify for an exemption under section 222.21(2)(a)(1). Section 222.21(2)(a)(1) requires that a profit-sharing plan qualify under section 401(a) of the Internal Revenue Code, not that the plan comply with the Employee Retirement Income Security Act.
The briefs can be found at the following links:

Order Requiring Production Of Materials Protected By Work Product Privilege Affirmed

In Paradise Pines Health Care Assoc., LLC v. Bruce, et al (1D09-961),  in a divided opinion, the First District affirmed the trial court's order requiring the production of material protected by the work product privilege. Chief Judge Hawkes wrote the majority opinion and was joined by Judge KahnJudge Kahn also wrote a concurring opinion.  Judge Clark wrote a dissenting opinion.  The majority opinion stated:
Under Rule 1.280(b)(3) (2008), Florida Rules of Civil Procedure, there are two prongs that the Respondents must meet to overcome the Petitioner’s work product privilege: (1) a need for the document sought; and (2) an inability to obtain equivalent information without undue hardship....To determine whether a moving party will experience undue hardship, courts must balance the moving party’s burden in obtaining information with the non-moving party’s burden of production. Here the trial court determined the Respondents had no realistic way to independently procure the information and the Petitioner had the incident reports at their immediate disposal.
In the order, the trial court expressly stated the Respondents demonstrated a need for the reports; then, in the following sentence, explained that the subject of the incidents contained in the reports was deceased and “unable to confer [] about events surrounding any of the incidents.” This is an implicit finding of undue hardship on the part of the Respondents.
Because the trial court applied the proper test and balanced the factors, the First District refused to grant a writ a certiorari. The dissent concluded:
The order on appeal stated “[Petitioner] has also failed to demonstrate any undue hardship which it would suffer by virtue of producing the incident reports.” Hardship upon the party producing the records is irrelevant to the rule 1.280 (b)(3) analysis. The respondents were the party seeking production of the incident reports, not the petitioner.

Oral Ruling Cannot Be Appealed

In Lawton v. Sorrells (1D09-4016), the First District dismissed an appeal because "without a signed written order there is nothing to appeal, and therefore, an oral pronouncement cannot be appealed."

Sunday, December 20, 2009

Order Denying Relief From Judgment Reversed - Party Not On Notice That ABC Would Discharge Debts Of Individual Who Was Non-Party

In Associated Receivables Funding of Florida, Inc. v. Moecker, et al (5D08-4353), the Fifth District reversed the trial court's denial of a motion for relief from judgment.  Although the appellant was a party to the underlying assignment for the benefit of creditors, it was not put on notice the debts of the individual (non-party) would be discharged as well as those of the debtor corporation.  The court stated:
In 2004, Commerce became unable to pay its debts and executed an assignment for benefit of creditors1 to Michael Moecker...Moecker filed a petition for assignment for benefit of creditors, and notified Commerce’s creditors of the proceedings. Notably, the petition did not name Rivers as a party...Moecker and Rivers reached a compromise wherein Rivers agreed to purchase all of Commerce’s assets.
Moecker sought court approval of the compromise...He further stated that approval would preclude any of Commerce’s creditors from pursuing claims against Commerce’s successor-in-interest, IBSG, based on any claim the creditor had against Commerce. The motion defined IBSG, however, to include Rivers in his individual capacity. Thus, approval of the compromise between Moecker and Rivers sought not only to preclude claims against Commerce, but also claims against Rivers individually. Appellant was served with the motion, but did not file an objection.
Almost two years later, Appellant filed a motion for relief from judgment under Florida Rule of Civil Procedure 1.540(b)(4). It claimed that the order was void because the trial court lacked jurisdiction over Appellant’s claim against Rivers individually. It argued that although it was a “party of interest to said action by way of a claim it filed against Commerce, . . . [Appellant] did not submit the debt against Rivers to the jurisdiction of the court . . . .” We agree.
A court cannot determine matters not the subject of appropriate pleadings....The jurisdictional pleadings in this case were insufficient to put Appellant on notice that the court might enjoin Appellant from collecting its judgment against Rivers, a non-party to the assignment....Here, simply because Appellant was on notice of the motion to approve the compromise and sale of Commerce’s assets, it was not on notice that these proceedings extended beyond claims against Commerce. By purporting to extinguish Appellant’s claims against a non-party, the court denied Appellant’s due process rights. Appellant is entitled to relief from the judgment pursuant to rule 1.540.

Friday, December 18, 2009

Citizens Property Insurance Corporation Is Immune From Bad Faith Claims

that Citizens is immune from first-party bad faith claims pursuant to section 627.351(6)(r)1. Likewise, we hold that Citizens is not subject to bad faith liability under section 624.155(1)(b)(1), as that statute is not applicable to it. Finally, we quash the discovery order dated April 15, 2009, and remand for further proceedings not inconsistent with this opinion. Prohibition, of course, applies only to the count seeking bad faith liability.
The opinion stated:
Mr. Garfinkel obtained a policy of windstorm insurance from Citizens covering his residence. As with many other Floridians, his residence was damaged by the multiple 2004 hurricanes. After a dispute arose concerning the extent of damage to the residence Mr. Garfinkel filed a two-count complaint to enforce his contract rights. The first count alleged a breach by Citizens of the contract of insurance, while the second count sought a declaration that the damage was covered by the policy. The parties agreed to resolve these issues using the appraisal process, and an appraisal award was eventually entered in favor of Mr. Garfinkel. When Mr. Garfinkel moved to confirm the award, he sought an amount in excess of the policy limits, asserting three distinct claims resulting from three separate occurrences. The trial court confirmed the award, but limited the amount awarded to the policy limits for a single occurrence.
The issue specifically before us is whether Citizens is shielded by sovereign immunity for the purposes of bad faith claims....According to its enabling statute, Citizens was created by the Florida Legislature in order to ensure the existence of an orderly market for property insurance, and particularly windstorm insurance, within Florida...Thus, it is explicitly clear that Citizens is not a private insurance company, but rather is a state body.
Citizens argues that the plain meaning of the statute permits only certain categories of suit against it, and bad faith claims are not among them. Mr. Garfinkel asserts to the contrary that the particular requirement to act in good faith found in section 627.351(6)(r)(2), suggests that the Legislature fully intended to allow a policy holder to assert a bad faith claim. The argument made by Citizens is more persuasive.
The logical implication is that the Legislature created Citizens as a state entity and made it immune from suit except for those suits of a very particular variety. Nowhere in section 627.351(6)(r)1 is there a specific exception stated for statutory bad faith claims under section 624.155(1)(b)(1). Moreover, the legislative history supports the view that there was no intention by the Legislature to subject Citizens to bad faith claims.
Thus, the Legislature was specifically presented with the opportunity to amend the statute to make certain that bad faith claims against Citizens would be authorized, but chose not to do so. Accordingly, the recent legislative history suggests that the Legislature did not intend for section 627.351(6)(r)2. to create a private right of action by policy holders against Citizens.

Wednesday, December 16, 2009

"TOUSA bidding process, breakup fee approved" - Starwood's $61 Million Dollar Stalking Horse Bid Moves Forward

Paul Brinkman published an article today titled "TOUSA bidding process, breakup fee approved" which can be found at both and The South Florida Business Journal.  Discussed is a hearing today during which Southern District of Florida Bankruptcy Judge John Olson allowed Starwood Land Ventures's $61 million dollar stalking horse bid to go forward with a $1.8 million dollar breakup fee to Starwood if the bid is not successful.  The article states:
Starwood’s attorney, Ivan Reich of Gray Robinson, said the company has already spent $900,000 evaluating the purchase since June.  “This is a substantial purchase in a market that is basically not moving, as your honor knows,” Reich said.
*Disclaimer: GrayRobinson is involved in this action.

Clerk's Date Stamp Is Dispositive Of Filing Date Regardless Of Contrary Evidence

In Strax Rejuvenation and Aesthetics Institute, Inc. v. Shield (4D09-3587), the Fourth District held "that, pursuant to rule 1.080(e), the clerk’s date stamp is dispositive on the issue of the date of filing a paper with the trial court."  Based upon its ruling, the court dismissed the appeal as untimely as the clerk's stamp indicated the notice of appeal was filed one day late.  The appellant presented affidavits stating the notice was timely filed.  However, the court concluded the date stamp controlled and certified conflict with Weintraub v. Alter, 482 So. 2d 454 (Fla. 3d DCA 1986).  The court concluded:
And, while we are cognizant of the fact that it is within the realm of possibility that the clerk’s date stamp machine may, from time to time, produce an incorrect date, prudent attorneys and clerks always have the option of paying closer attention to such details before the jurisdictional time limit expires.
Accordingly, we hold that, pursuant to rule 1.080(e), the clerk’s date stamp is dispositive on the issue of the date of filing a paper with the trial court. In this case, the clerk’s date stamp establishes that the notice of appeal was filed after the expiration of the jurisdictional time limit to file an appeal. Therefore, the motion to dismiss is granted and this appeal is dismissed. In so doing, we certify conflict with the Third District’s opinion in Weintraub.

Federal Judge Suggests The SEC Should Go After Ponzi Investors For Profit & Principal

Shannon P. Duffy at has an article titled "Federal Judge Takes Issue With SEC's Treatment of Ponzi Scheme 'Winners'."  Judge Paul S. Diamond, a Judge in the United States District Court for the Eastern District of Pennsylvania, issued an eleven page order (HERE) stating:
Ponzi schemes are pernicious because they masquerade as legitimate investments. In fact, only a very few early “investors” recover their principal and earn profit – paid entirely from the monies provided by later “investors,” who commonly lose everything.
When claims are brought against Ponzi scheme investors, “the general rule is that to the extent innocent investors have received payments in excess of the amounts of principal that they originally invested, those payments are avoidable as fraudulent transfers.”
The SEC and CFTC have apparently adopted a nationwide policy that there can be no recovery of principal from winning Ponzi scheme investors even when the investors should have seen “red flags” alerting them to the true nature of their “investments.”
First, as I have shown, there is “statutory and case law support” for the Receiver’s recovery of principal. In any event, I agree with the SEC that truly “innocent” investors who acted “in good faith” should not be compelled to return their principal to the Receivership Estate. It does not appear, however, that Mr. Hoyle or the Receiver seek such a result. Rather, they could recoup principal only when an investor is not “innocent” or has not acted in “good faith.”...If Mr. Hoyle is successful, this would allow the Receiver to increase significantly the funds she could distribute pro rata to all Mr. Forte’s victims...Accordingly, it could well be more equitable and legally supportable for the SEC and the CFTC to support the Receiver’s original plan: “as PUFTA provides, [to file] suit to recover the entire fraudulent transfer from all Limited Partner net winners” - both the profits and the principal.
It will be interesting to see how this theory plays into the Scott Rothstein ponzi scheme.

Tuesday, December 15, 2009

GrayRobinson, P.A.'s Grier Wells Wins Reelection to the Florida Bar Board of Governors

The following was released by GrayRobinson at THIS link:
Wells Wins Reelection to the Florida Bar Board of Directors
S. Grier Wells, a shareholder at GrayRobinson, P.A., has won reelection to the Board of Governors of The Florida Bar - a position that he has held since 2002. Wells ran unopposed and will represent the Fourth Judicial Circuit for another two-year term.
"I am very pleased to continue my service to The Florida Bar as part of the Board of Governors," said Wells. "I have been an active member of The Board for more than eight years and am excited to help mold the direction of The Bar another two years."
Wells has held several other leadership positions in addition to the one he holds on The Florida Bar. He is a charter member and former President of the Jacksonville Chapter of the American Board of Trial Advocates and previously served as the President of the Jacksonville Bar Association. Professionally, he practices in GrayRobinson's Jacksonville office and concentrates in the areas of Alternative Dispute Resolution, Commercial Litigation, Construction Litigation, Employment Litigation and Insurance Defense.
Wells attained both his undergraduate and law degrees from the University of Florida.

Dismissal Of Challenge To Florida's Use Of State Funds To Support Faith-Based Substance Abuse For Prisoners Reversed

In COUNCIL FOR SECULAR HUMANSIM, INC., RICHARD HULL and ELAINE HULL, v. WALTER A. MCNEIL, in his official capacity as Secretary of Corrections of Florida: PRISONERS OF CHRIST, INC., a Florida corporation; and LAMB OF GOD MINISTRIES, INC., Florida corporation (1D08-4713), the First District reversed the trial court's order granting a motion for judgment on the pleadings in a "petition seeking to have the trial court prohibit, on state constitutional grounds...from using State funds pursuant to sections 944.473 and 944.4731, Florida Statutes (2007), to support the faith-based substance abuse transitional housing programs of appellees."

Count I
Examining the contracts involved, the trial court rejected the contention of the appellants that the DOC contracts in this case mandated adherence to Christian doctrines. The trial court reasoned that these contracts require the contractors to ensure that state funds are used for the sole purpose of furthering the secular goals of criminal rehabilitation and the staff of the ministries are prevented from disparaging a client’s religious beliefs or seeking to convert them to a particular religious faith. See, e.g., Freedom From Religion Foundation, Inc. v. McCallum, 324 F.3d 880 (CA 7, 2003)
The appellants’ claims in Count I are based on the no-aid provision in Florida’s constitution, not the state or federal Establishment Clauses...As this court explained in Holmes I, Article I, section 3 of the Florida Constitution is not “substantively synonymous with the federal Establishment Clause.”...Specifically, the state may not use tax revenues to “directly or indirectly” aid “any church, sect, or religious denomination or any sectarian institution.”
We agree that Florida’s no-aid provision does not create a per se bar to the state providing funds to religious or faith-based institutions to furnish social services. As we explained in dicta in Holmes I, 886 So. 2d at 362, “nothing in the Florida no-aid provision would create a constitutional bar to state aid to a non-profit institution that was not itself sectarian, even if the institution is affiliated with a religious order or religious organization.” The inquiry here is whether the programs funded by sections 944.473 and 944.4731 and provided by Prisoners and Lamb of God are predominantly religious in nature and whether the programs promote the religious mission of the organizations receiving the funds
Count II
In Count II, appellants have challenged the contracts entered into between DOC and Prisoners and Lamb of God, alleging that they require these ministries to “provide a transitional program that includes a faith-based component resulting in spiritual renewal” and that “the spiritual renewal is created by inculcating faith in Jesus Christ.” In Count II, appellants assert that “[t]o the extent Florida Statutes sections 944.473 and 944.4731 authorize the Illegal Contracts and payment of the Illegal Contracts, those statutes should be declared unconstitutional.” They ask that McNeil be enjoined from entering into the contracts.
We agree with appellees that, to the extent that Count II challenges McNeil’s authority to enter into contracts and the performance of those contracts by the ministries, the trial court correctly concluded taxpayer standing is not present. For, as appellees argued below, allowing third parties to gain access to courts based upon taxpayer standing to challenge the performance of contracts and the decision of an executive agency to enter into a contract would be extraordinarily burdensome and would impermissibly allow a taxpayer to interfere with State procurement contracts.
Count III
In Count III, CSH and the Hulls have alleged that section 944.4731(6)(a) provides a “chaplain” with important government powers with respect to the placement of offenders in substance abuse transitional programs.  These allegations do not state a cause of action under either the Federal Establishment Clause or Article I, section 3 of the Florida Constitution. Appellants have not alleged that the acts of these chaplains establish a religion. In addition, the state’s employment of a chaplain does not violate the Establishment Clause.

Florida's 2010 Statutory Interest Rate Is 6% Per Annum Or .0001644 Per Day

The Florida Department of Financial Services announced that the Statutory Interest Rate for 2010 will be 6% per annum or .0001644 per day.  The interest rate for each year from 1981 through 2010 is below.
Florida Statutory Interest 2010

Report: South Florida Is The Top Judicial Hellhole® In The Country

South Florida is the top "Judicial Hellhole®" in the country according to the American Tort Reform Foundation.  The 2009/2010 report can be found HERE and an executive summary can be found HERE
Judicial Hellholes are places where judges systematically apply laws and court procedures in an inequitable manner, generally against defendants in civil lawsuits. In this eighth annual report, ATRF shines the spotlight on six areas of the country that have developed reputations for uneven justice. Many of the jurisdictions cited this year have been cited before, and positive reforms are often fought tooth-and-nail. Not coincidentally, the local or state economies in many of these Hellholes jurisdictions have suffered more than most during the latest recession. And while reasonable people may disagree about the specific rankings assigned to each, no one can reasonably argue that the jurisdictions cited in this report do not qualify as Judicial Hellholes.
The Madison/St. Clair Record wrote an article, titled "South Florida is top 'Judicial Hellhole'" which can be found HERE. Other articles are found at the following links: Sacramento Bee; Southeast Texas Record

SCOTUS Blog's Tom Goldstein Has Some Fun With Tiger Woods & White House Crashers

SCOTUS Blog founder and publisher Tom Goldstein posted an apology video having some fun with the White House crashers and the Tiger Woods ordeal.  The video was posted at the SCOTUS Blog and is embedded below:

Monday, December 14, 2009

District Court Denies Motion To Compel Identity Of Person Posting Comments To Newspaper Article

As discussed HERE by Venkat Balasubramani, Judge Gary A. Fenner of the United States District Court for the Western District of Missouri held that an individual that posted a comment to a story in the Springfield News-Leader did not waive his/her right to anonymity:
despite a policy which allowed for disclosure, the court found that there was no waiver. Among other reasons, the court relied on the fact that the provision governing disclosure was buried in a privacy policy which the commenter probably did not read in the first place.
After a prosecutor decided to drop charges, the Springfield News-Leader ran a story about it.  A comment was posted that criticized the prosecutor's decision.  The plaintiff in a related civil case served a subpoena on the newspaper requesting the identity of the person that posted the comments.  Judge Fenner ruled:
In this case, Plaintiff relies upon two sentences in a two-page document in which the overarching theme is that information provided by a user of the site may be used for various commercial purposes. Nothing on the face of the privacy policy even hints a user may be waiving his or her constitutional right to anonymous free speech by posting comments or materials on the News-Leader’s website. Given the presumption against waiver and the boiler-plate language Plaintiff relies upon, it cannot be said that the anonymous poster was aware he or she may be waiving the right to free speech, let alone the significance of such waiver. For these reasons, Plaintiff’s Motion is DENIED.
The court's entire order is below:
Sedersten v. Taylor

Scott Rothstein (RRA) Documents And Court Filings

I updated the list of Scott Rothstein documents.  You can view the documents at the links below and all prior Rothstein posts at THIS link.

USA v. Rothstein


Carolina Casualty Malpractice Rescission Complaint

*Exhibit A;
*Exhibit B;
*Exhibit C;
*Exhibit  D;
*Exhibit E;
*Exhibit F; and
*Exhibit  G.

Mass Mutual v. Scott Rothstein

*Exhibit 1: Life Insurance Policy.

Disbarment Documents

*Petition to Accept Disbarment Of Scott Rothstein;
*Florida Supreme Court's High Profile Order in Rothstein Disbarment Proceeding;
*Disbarment on Consent;
*Florida Bar's Affidavit of Costs in Rothstein Disbarment Proceeding; and
*Disbarment Order.

Bankruptcy Documents

*Stettin's RRA Overview (12-3-2009);
*RRA List of 20 Largest Unsecured Creditors;
*RRA's Emergency Motion To Enforce Stay in bankruptcy court;
*RRA Involuntary Bankruptcy Petition;
*Emergency Motion for Appointment of Temporary Chapter 11 Trustee;
*Notice of 2004 Exam of Qtask;
*Notice of 2004 Exam of Levinsons' Jewelers;
*Subpoena for 2004 Exam of T.D. Bank;
*Notice of 2004 Exam of J.R. Dunn;
*Morse Notice of 2004 Exam of T.D. Bank.

TD Bank v. Stettin et al.

*Motion to Deposit Money Into Court Registry.

Stettin v. Rothstein

*Emergency Motion for Preliminary Injunction;
*Scott Rothstein's Notice of Filing;
*Trustee's Notice of Filing


Bankruptcy Judge Issues Writing Guidelines - "Judge Orders You to Stop Writing Stupidly" has an article about United States Bankruptcy Court Judge Robert Kressel's writing guidelines.  The Judge stated his goal as follows:
My goal in preparing orders, as it is for all of my legal writing, is to use regular grammatical English as much as possible. A secondary goal is to use actual statutory language as much as possible, rather than changing or paraphrasing it, which runs the risk of changing its meaning. When you prepare proposed orders, please keep these principles in mind.
The entire guideline can be found HERE.  A couple of the guidelines are below:

Never use and/or.
Never use capital letters to identify something unless it is a proper name.
Never use quotation marks and parenthesis to identify something.
Eliminate superfluous words.

South Carolina Says Judges Can Use Facebook As Long As They Do Not Discuss Issues Relating to Judicial Work

The South Carolina Advisory Committee on Standards of Professional Conduct issued an advisoty opinion "RE: Propriety of a magistrate judge being a member of a social networking site such as Facebook."  The opinion, which can be found HERE, concluded "A judge may be a member of Facebook and be friends with law enforcement officers and employees of the Magistrate as long as they do not discuss anything related to the judge’s position as magistrate."  Florida reached a different result on a slightly different question which was discussed HERE.

Thanks to Legal Blog Watch.

Supreme Court To Review Employer Access To Worker Text Messages, Grants Certiorari In Three Cases, Dismisses Chrysler Petition

This morning the United States Supreme Court granted certiorari in three cases.  You can view the order list HERE


The petition for a writ of certiorari is granted.
The motion of petitioner for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted limited to the following question: Whether an action for criminal contempt in a congressionally created court may constitutionally be brought in the name and pursuant to the power of a private person, rather than in the name and pursuant to the power of the United States.
The petition for a writ of certiorari is granted.
The SCOTUS Blog has two posts: Torture, Chrysler cases ended; 3 grants  and  Today’s orders

Sunday, December 13, 2009

"Justices making new push to abolish elected judges"

The Associated Press has an article titled "Justices making new push to abolish elected judges" which can be found at THIS link.  "Former Supreme Court Justice Sandra Day O'Connor and several state Supreme Court justices are planning a nationwide push during next year's state legislative sessions to end the practice of electing judges."

I previously had a post, HERE, about Justice O'Connor's view of judicial elections.

Lead Attorney In Obama "Birther" Movement Files Brief In Eleventh Circuit Weeks After Case Dismissed For Lack Of Prosecution

Previously, I had a post titled "Lead Anti-Obama 'Birther Movement' Attorney Sanctioned And...Appeals Order To Eleventh Circuit."  The same attorney recently posted a portion of her initial brief in a different case to her web site.  A copy of the entire brief on appeal can be found HERE.  Not mentioned on the web site, and a big problem from the perspective of the appellant, is that the Eleventh Circuit dismissed the appeal fourteen days before the brief was filed.  As stated on the court's docket, a copy of which can be found HERE, on November 24, 2009 the Eleventh Circuit entered an order stating "Pursuant to the 11th Cir.R.42-2(c), this appeal is dismissed for want of prosecution because the appellant failed to file brief and record excerpts within the time fixed by the rules."

I am sure there will be more to this story and thanks to A.P. for pointing out my mistake. 

Saturday, December 12, 2009

D'Alemberte Files Petition In Florida Supreme Court To Create Commision To Investigate Wrongful Convictions

Sixty members of the Florida Bar, led by Talbot "Sandy" D'Alemberte, filed a petition in the Florida Supreme Court to form a Commission "to investigate the circumstances ofcases where actual innocence of a crime has been demonstrated and to develop recommendations for reforms to reduce wrongful convictions."

You can view the Petition HERE.

You can view articles at the following links: Miami Herald,  Florida Today,  and

Journal Of High Technology Law Publishes Volume X, Number 1

The Journal of High Technology Law announced the "publication of Volume X, Number 1, featuring lead article, Biotechnological Innovation and Partnerships, by Richard Gold."  The information below is from

Volume X - Number 1
Cite as: J. High Tech. L.
E. Richard Gold

Professor Richard Gold describes the biopharmaceutical industries’ restructuring in terms of intellectual property (“IP”): why and when patents are acquired, how they are licensed and shared, and how they are enforced. This article was originally submitted as part of the Advanced Legal Studies symposium, “The Impact of Patent Law on the Economy – Stimulus or Impediment?” held at Suffolk University Law School on March 27, 2009. The symposium was sponsored with the Journal of High Technology Law and Suffolk University Law School’s IP Law Concentration.
Kristen C. Buteau
35 U.S.C. § 103 mandates that an invention be nonobvious to a person of ordinary skill in the art. In the chemical arts, structural similarity between the prior art and the claimed compound establishes a prima facie case of obviousness, which may be rebutted by a showing that the claimed compound produced results which were not expected at the time of the invention. Because biological activity is inherently unpredictable and evidence of unexpected results supports a finding of nonobviousness, it is likely that isotope substitution will yield similarly unpredictable biological activity and thus render the isotopic structures nonobvious.
Robert A. Penchuk
Proponents of network neutrality seek to regulate the Internet to ensure equal access by all members of society. Conversely, those who favor network diversity argue that continued Internet development in a free market economy necessitates price and service discrimination, unencumbered by stifling regulation. Penchuk describes an alternative proposal to this seemingly intractable problem – a proposal leveraging mobile Internet adoption, recently reallocated digital television (DTV) white-space, and technological advances in multi-mode and cognitive radio. Penchuk argues that the Federal Communications Commission has the mandate to implement ad-hoc mobile Internet access in a way that will ensure fair and balanced Internet access driven by competitive market forces rather than regulation.
Absolute Truth or Deus Ex Machina?: The Legal and Philosophical Ramifications of Guilt-Assessment Technology
Aaron M. Stronge
Stronge analyzes the effects of burgeoning guilt-assessment technologies with respect to our judicial system. He looks first to the historical treatment of the results obtained from lie detection devices by the courts in outlining the requirements for admission of scientific evidence that this technology has failed to meet. After establishing this foundation, Stronge opines about just how accurate these devices need to be, as well as the far-reaching ramifications, both legally and philosophically, when this standard is inevitably reached.

Florida Judges Cannot Be Friends With Florida Lawyers On Facebook

Florida's Judicial Ethics Advisory Committee issued an opinion (2009-20) on November 17, 1009 relating to the use of social networking sites by sitting judges.  The New York Times has an article titled "For Judges on Facebook, Friendship Has Limits."  The opinion's summary of issues is directly below and the entire opinion is below that.
Whether a judge may post comments and other material on the judge's page on a social networking site, if the publication of such material does not otherwise violate the Code of Judicial Conduct.
Whether a judge may add lawyers who may appear before the judge as "friends" on a social networking site, and permit such lawyers to add the judge as their "friend."

Whether a committee of responsible persons, which is conducting an election campaign on behalf of a judge's candidacy, may post material on the committee's page on a social networking site, if the publication of the material does not otherwise violate the Code of Judicial Conduct.

Whether a committee of responsible persons, which is conducting an election campaign on behalf of a judge's candidacy, may establish a social networking page which has an option for persons, including lawyers who may appear before the judge, to list themselves as "fans" or supporters of the judge's candidacy, so long as the judge or committee does not control who is permitted to list himself or herself as a supporter.

Judicial Ethics Opinion 2009-20

As of now, there are 445 stories around the world on this story.  You can see a list of the most popular from Google News HERE.

Thursday, December 10, 2009

A Lawsuit Seeking The Transfer Of Title In Real Property Is Proper Only In County Where Property Is Located

In Floridian Community Bank, Inc. v. Bloom (4D09-3195), the Fourth District granted a writ of prohibition because the trial court exceeded its subject matter jurisdiction.  A lawsuit seeking the transfer of title in real property must be brought in the county in which the real property is located.  The Fourth District stated:
Prohibition lies where a petitioner has demonstrated that a trial court lacks subject matter jurisdiction over a lawsuit. English v. McCrary, 348 So. 2d 293 (Fla. 1977). This case involves application of the “local action rule,” which governs subject matter jurisdiction, not venue. Hudlett v. Sanderson, 715 So. 2d 1050 (Fla. 4th DCA 1998); State Dep’t. of Nat’l Res. v. Antioch Univ., 533 So. 2d 869 (Fla. 1st DCA 1988).
In Ocean Bank v. State, Dept. of Fin. Serv., 902 So. 2d 833 (Fla. 1st DCA 2005), Ocean Bank sought prohibition on the grounds that the Leon Circuit Court was exceeding its subject matter jurisdiction in a receivership action by presiding over matters directly related to a foreclosure action pending against real property located in Dade County. Id. at 834. The first district applied the “local action rule” under which a suit primarily seeking transfer of title to real property is considered quasi in rem and is required to be brought in the county where the land is situated. Id. at 835.
The first district also found in Ocean Bank that the claim to void a mortgage was a compulsory counterclaim in the pending mortgage foreclosure action. Id. Similarly, in the present case, the respondents’ claims for breach of loan extension agreement, breach of covenant of good faith and fair dealing, novation and rescission of the loan extension agreement involve parties, properties, facts and circumstances, and security instruments identical to those involved in FCB’s mortgage foreclosure action. Therefore, respondents’ claims “aris[e] out of the transaction or occurrence that is the subject matter” of FCB’s claim and are compulsory counterclaims properly brought pursuant to Florida Rule of Civil Procedure 1.170(a) in connection with FCB’s action in Collier County.

Florida Supreme Court Accepts Jurisdiction Of Issue Relating To Sufficiency Of Plaintiff's Expert In MedMal Case

The Florida Supreme Court accepted jurisdiction in Cox v. St. Joseph's Hospital (SC09-1771).  The order accepting jurisdiction can be found here.  The Second District's opinion under review was discussed here.  The Petitioner's Brief on Jurisdiction can be found here and the Respondent's Jurisdictional Answer Brief can be found here

The Second District's opinion stated:
In moving for a directed verdict, the hospital and ER doctor argued that the Coxes failed to prove that Mr. Cox more likely than not would have benefitted from tPA....In negligence actions, Florida courts follow the "more likely than not" standard of causation, i.e., they require proof that the negligence "probably caused" the plaintiff's injury. Gooding v. Univ. Hosp. Bldg., Inc., 445 So. 2d 1015, 1018 (Fla. 1984). " 'A mere possibility of such causation is not enough; and when the matter remains one of pure speculation or conjecture, or the probabilities are at best evenly balanced, it becomes the duty of the court to direct a verdict for the defendant.' " Id. (quoting Prosser, Law of Torts § 41 (4th Ed.1971) (footnotes omitted)). A medical expert's opinion is not exempt from this rule. The supreme court has explained that "[t]he opinion of an expert is not sufficient to eliminate the necessity of proving the foundation facts necessary to support the opinion."....In the absence of competent evidence to prove that the failure to treat Mr. Cox with tPA more likely than not affected his outcome, the trial court should have granted the defense motion for a directed verdict. Under these circumstances, we must reverse the judgment.

Florida Supreme Court To Determine Whether Trial Court Can Reserve Jurisdiction To Determine Prejudgment Interest

The Florida Supreme Court has accepted jurisdiction in Westgate Miami Beach, Ltd. v. Newport Operating Corp. (SC09-1881).  The order accepting jurisdiction can be found here.  The decision from the Third District under review was discussed here.  The order granting ceritification was discussed here.  The questions certified were:

Wednesday, December 9, 2009

Superior Mortgagee May Elect The Time And Manner Of Enforcing Security

In CitiMortgage, Inc. v. Henry, et al (2D07-5982, 2D08-6252), the Second District reversed the trial court's judgment and denial of a motion to vacate a default judgment in a related proceeding.  The court stated:
In resolving this consolidated appeal, the issue that we must address is whether the trial court's judgment of foreclosure entered on the Wachovia mortgage was valid so as to be a viable affirmative defense to Citimortgage's foreclosure proceeding. If the prior foreclosure proceeding was a nullity, then not only should the summary judgment on appeal be reversed, but also the order that denied Citimortgage's request to vacate the prior foreclosure judgment.
Turning to a 1940 decision from the Florida Supreme Court, the Second District stated:
Our resolution of this issue is controlled by Cone Bros. Construction Co. v. Moore, 193 So. 288 (Fla. 1940)...The court determined that the service of process was sufficient and that the first foreclosure court had jurisdiction over Mrs. Moore. However, the court determined that the trial court was correct in concluding that the Cone Brothers' foreclosure action was not a proper forum to litigate Mrs. Moore's mortgage if in fact that mortgage was the superior interest in the real property.
A prior mortgagee may elect for himself the time and manner of enforcing his security. He cannot be compelled to be a party to a suit by a junior encumbrancer foreclosing his lien. It is not proper in foreclosure proceedings to try a claim of title superior or paramount to that of the mortgagor and even if a party having title is made a party and judgment entered after a hearing, it will not bind his interest; but if such claim is set up by a defendant, and this be litigated, then both parties will be bound by the decree.
. . . .
If it be determined on final hearing that the mortgage of [Mrs. Moore] is entitled to priority over that of [Cone Brothers], then the decree of the lower court, in so far [sic] as it affects the rights of [Mrs. Moore], is ineffectual—[Mrs. Moore] not being [a] proper part[y] to the suit; but if it be found that the contrary is true, then the decree rendered in the former suit is binding on [Cone Brothers].
Accordingly, the trial court erred in granting summary judgment and instead should have held an evidentiary hearing to determine whether the mortgage interest held by Citimortgage is indeed superior to the Wachovia mortgage interest. On remand, if the trial court finds that the interest of Citimortgage is superior, the trial court should not only deny Wachovia's affirmative defenses but also vacate as void the prior final judgment entered in Wachovia's favor to the extent that it extinguished the MERS mortgage interest in the real property. However, if Wachovia can show that the interest of Citimortgage is inferior to that of Wachovia, the prior foreclosure judgment would be valid and judgment in favor of Wachovia on its affirmative defense would be proper in the Citimortgage foreclosure proceeding. Similarly, the denial of the motion to vacate in the Wachovia foreclosure proceeding would be appropriate.

Judgment Creditor Must Pay Costs Of Proceedings Supplementary To Execution - But Can Tax Costs Against Debtor

In PMI Mortgage Insurance Co. v. Kahn (3D09-65), the Third District affirmed the trial court's decision requiring the judgment creditor to pay the costs of a special magistrate associated with a proceedings supplementary to execution.  The court concluded "We answer that question in the affirmative, concurring with a manual for practitioners on the topic: “[o]f course, the judgment creditor must pay for the magistrate, but the costs may be taxed against the defendant.'"

Fourth District Reverses Order Denying Motion To Compel Arbitration

In Ballenisles Country Club, Inc. v. Dexter Realty (4D09-485), the Fourth District reversed the trial court's denial of a motion to compel arbitration.  The court held:
“A court must compel arbitration where an arbitration agreement and an arbitrable issue exists, and th e right to arbitrate has not been waived.”...Arbitration is a preferred method of dispute resolution, so any doubt regarding the scope of an arbitration clause should be resolved in favor of arbitration.
Arbitration clauses are construed according to basic contract interpretation principles. Seifert v. U.S. Home Corp., 750 So. 2d 633, 636 (Fla. 1999). The plain language of the agreement containing the arbitration clause is the best evidence of the parties’ intent. Royal Oak Landing Homeowner’s Ass’n v. Pelletier, 620 So. 2d 786, 788 (Fla. 4th DCA 1993). The arbitration clause must be read together with the other provisions in the contract. See J.C. Penney Co. v. Koff, 345 So. 2d 732, 735 (Fla. 4th DCA 1977) (stating that a court must review the contract “without fragmenting any segment or portion”).
We conclude, however, that the arbitration clauses in the Subscription Agreement fall into Aberdeen’s first category. The broad language of these clauses shows that they were meant to operate as an irrevocable substitute for litigation in court and were meant to survive the transition of control of the country club, just as certain covenants in the Subscription Agreement and Membership Purchase Agreements survived that transition.

Minority Shareholder Must Utilize Derivative Action -Not Breach Of Fiduciary Duty- Against Majority Shareholder

In Karten v. Woltin (4D08-4057), the Fourth District held:
This appeal presents the question of whether a minority shareholder could pursue as a direct action a claim for breach of fiduciary duty against the majority shareholders of a closely held corporation or whether, as the trial court concluded, he was required to file a derivative action. We find that, based on the facts in this case, the appellant was required to utilize a shareholder’s derivative action to pursue his cause of action.
Shareholders may bring a direct suit only “in their own right to redress an injury sustained directly by them individually.” Fort Pierce Corp. v. Ivey, 671 So. 2d 206, 207 (Fla. 4th DCA 1996).

Fourth District Chief Judge Gross Suggests Court Will Recede From Chapman v. Chapman & O’Neill v. O’Neill

In Mathers v. Brown (4D08-1470), the Fourth District denied a motion for rehearing and rehearing en banc of THIS opinion released on September 9, 2009.  Chief Judge Gross wrote a concurring opinion stating:
Appellant’s motion for rehearing en banc was directed at the issue of prejudgment interest. In the proper case, when the issue is before us, this court should recede en banc from Chapman v. Chapman, 866 So. 2d 118 (Fla. 4th DCA 2004), and O’Neill v. O’Neill, 868 So. 2d 3 (Fla. 4th DCA 2004). Read together, these cases hold that the appreciation in the value of a non-marital brokerage account during a marriage is a marital asset to the extent that it exceeds the passive appreciation in the brokerage account as measured by an appropriate stock index. These cases have gone beyond the language of the statute to create complexity where a spouse brings assets to a marriage.

Insured Not Required To Disprove Findings Of Insurer's Expert In Sinkhole Claim

UPDATE 2: The Florida Supreme Court entered an order accepting jurisdiction of this case.  The supreme court's order can be viewed HERE.

UPDATE: The Second District denied a motion for rehearing, granted a motion for certification to the Florida Supreme Court and withdrew the opinion discussed below.  A new opinion was released which can be found HERE.  The new opinion reaches the same result as the opinion discussed below and certifies the following question to the Florida Supreme Court:
In Warfel v. Universal Ins. Co. of North America (2D08-3134), a divided panel on the Second District reversed the trial court's judgment in a sinkhole case.  Judge LaRose wrote the majority opinion and was joined by Judge WallaceJudge Villanti wrote a dissenting opinion.  The issue in the case relates to the insured's burden to present expert testimony to establish the loss was caused by a sinkhole.

The insurer hired an expert that determined the alleged sinkhole damage was cause was excluded items.  The insured's experts testified at trial that while the insurer's expert was correct, the damage was at least partially caused by a sinkhole.  The majority opinion stated:
Universal posited that section 627.7073(1)(c) required Mr. Warfel to prove that he suffered a sinkhole loss as specifically defined by statute...Universal reasoned that the SD II Global report findings are presumptively correct; the presumption shifted the burden of proof to Mr. Warfel. The trial court agreed
We see no clear legislative expression that public policy compels a homeowner to shoulder the burden to disprove the findings and recommendations of the insurer's engineers and geologists. We are also mindful that, historically, an all-risks policy encumbers the insurer with the burden to prove that a claimed loss is not covered.
Absent a clear legislative directive, we must conclude that section 627.7073(1)(c) is a "vanishing" or "bursting bubble" presumption that affected only Mr. Warfel's burden of producing evidence.
Because the trial court misapplied the presumption at work in this case and gave the jury an instruction improperly shifting the burden of proof, a new trial is required.
The dissent disagreed, stating:
I contend that because the statutory sections at issue in the case were enacted to advance social or public policy, a burden-shifting presumption applies...In fact, this case illustrates why section 627.7073's presumption ought to be a burden-shifting presumption. Upon receiving Mr. Warfel's claim, Universal hired experts whose qualifications met the requirements of the relevant statute and had those experts conduct the type of testing required by the statute. The experts then prepared a report as required by section 627.7073. This was all done at Universal's expense. At trial Mr. Warfel offered his own experts, who simply reviewed Universal's report and visited the property; they did not conduct independent testing consistent with the standards set forth in section 627.7072. Mr. Warfel's experts then simply disagreed with the report's conclusions and opined that a sinkhole contributed to the damage to Mr. Warfel's property. To apply a "vanishing" presumption under these facts effectively negates the presumption of correctness conferred upon the report by section 627.7073(1)(c). It is inconceivable that the legislature would enact a statute containing extensive detail regarding sinkhole testing and expert reports and that it would express its intent that the report "be presumed correct," only to have this presumption "vanish" when an expert hired by the insured simply testifies that he disagrees with the conclusions contained in the report. Allowing Mr. Warfel's experts to "vanish" the presumption created by the statute by simply testifying that they disagree with the report negates the statute's efforts to provide consistency in claims handling and reduce the number of disputed sinkhole claims. This type of ipse dixit logic from the insured's experts is not consistent with the history and intent of the statute.