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Jury instructions for contract and business cases.

The Supreme Court Committee on Standard Jury Instructions--Contract and Business Cases invites all interested persons to comment on the proposed new instructions below. Comments must be received by the committee on or before January 15, 2012. All comments received will be reviewed by the committee at its next meeting. Revisions to the proposed instructions may be made based upon comments received. Upon final approval of the instructions, the committee will make a recommendation to the Florida Supreme Court. E-mail your comments in the format of a Word document to Judge Jonathan D. Gerber, committee chair, at gerberj@flcourts.org, with a copy to the committee liaison, Jodi Jennings, at jjenning@flabar.org. 325 Breach of Implied Covenant of Good Faith and Fair Dealing

In the contract in this case, there is an implied promise of good faith and fair dealing. This means that neither party will do anything to unfairly interfere with the right of any other party to the contract to receive the contract's benefits; however, the implied promise of good faith and fair dealing cannot create obligations that are inconsistent with the contract's terms. (Claimant) contends that (defendant) violated the duty to act in good faith and fairly under [a] specific part[s] of the contract. To establish this claim, (claimant) must prove all of the following:

1. (Claimant) and (defendant) entered into a contract;

2. (Claimant) did all, or substantially all, of the significant things that the contract required [him] [her] [it] to do [or that [he] [she] [it] was excused from having to do those things];

3. All conditions required for (defendant's) performance had occurred;

4. (Defendant's) actions [or omissions] unfairly interfered with (claimant's) receipt of the contract's benefits;

5. (Defendant's) conduct did not comport with (claimant's) reasonable contractual expectations under [a] specific part(s) of the contract; and

6. (Claimant) was harmed by (defendant's) conduct.

NOTES ON USE

1. The question of whether a particular contract is one in which an implied covenant of good faith and fair dealing applies is a question for the trial court to answer in the first instance.

2. The implied covenant of good faith and fair dealing exists in virtually all contractual relationships. Sepe v. City of Safety Harbor, 761 So.2d 1182 (Fla. 2d DCA 2000); see also County of Brevard v. Miorelli Engineering, Inc., 703 So.2d 1049 (Fla. 1997); Restatement (Second) of Contracts [section]205 (1981).

3. The purpose of the implied covenant of good faith is "to protect the reasonable expectations of the contracting parties." Cox v. CSXIntermodal, Inc., 732 So.2d 1092, 1097 (Fla. 1st DCA 1999); Ins. Concepts & Design, Inc. v. Healthplan Services, Inc., 785 So.2d 1232, 1234-35 (Fla. 4th DCA 2001).

4. The implied covenant of good faith "is a gap filling default rule" which comes into play "when a question is not resolved by the terms of the contract or when one party has the power to make a discretionary decision without defined standards." Speedway Superamerica, LLC v. Tropic Enterprises, Inc., 966 So.2d 1, 3, n.2 (Fla. 1st DCA 2007); see also Cox, 732 So.2d at 1097.

5. "[B]ecause the implied covenant is not a stated contractual term, to operate it attaches to the performance of a specific or express contractual provision." Snow v. Ruden, McClosky, Smith, Schuster & Russell, P.A., 896 So.2d 787, 792 (Fla. 2d DCA 2005).

6. The implied covenant of good faith cannot override an express contractual provision. Snow, 896 So.2d at 791-92 ; see also Ins. Concepts, 785 So.2d at 1234.

7. "The implied obligation of good faith cannot be used to vary the terms of an express contract." City of Riviera Beach v. John's Towing, 691 So.2d 519, 521 (Fla. 4th DCA 1997); see also Ins. Concepts, 785 So.2d at 1234-35 ("Allowing a claim for breach of the implied covenant of good faith and fair dealing 'where no enforceable executory contractual obligation' remains would add an obligation to the contract that was not negotiated by the parties.") (citations omitted).

8. Good faith means honesty, in fact, in the conduct of contractual relations. Burger King Corp. v. C.R. Weaver, 169 F.3d 1310, 1315 (11th Cir. 1999), citing Harrison Land Development Inc. v. R & H Holding Co., 518 So.2d 353, 355 (Fla. 4th DCA 1988); see also RESTATEMENT (SECOND) OF CONTRACTS [section]205 cmt. a (1981).

335(a) AFFIRMATIVE DEFENSE--FRAUD

To establish the defense of fraud, (defendant) must prove all of the following:

1. (Claimant) represented that (insert alleged fraudulent statement) and that representation was material to the transaction;

2. (Claimant) knew that the representation was false;

3. (Claimant) made the representation to persuade (defendant) to agree to the contract;

4. (Defendant) relied on the representation; and

5. (Defendant) would not have agreed to the contract if [he] [she] [it] had known that the representation was false.

On this defense, (Defendant) may rely on a false statement, even though its falsity could have been discovered if (defendant) had made an investigation. However, (defendant) may not rely on a false statement if [he] [she] [it] knew it was false or its falsity was obvious to [him] [her] [it]. In making this determination, you should consider the totality of the circumstances surrounding the type of information transmitted, the nature of the communication between the parties, and the relative positions of the parties.

NOTES ON USE

1. Fraud must be pled as an affirmative defense or it is waived. Cocoves v. Campbell, 819 So.2d 910 (Fla. 4th DCA 2002); Peninsular Fla. Dist. Council of Assemblies ofGod v. Pan Am. Inv. & Dev. Corp., 450 So.2d 1231, 1232 (Fla. 4th DCA 1984); Ash Chem., Inc. v. Dep t of Envtl. Regulation, 706 So.2d 362, 363 (Fla. 5th DCA 1998).

2. In order to raise an affirmative defense of fraud, the "pertinent facts and circumstances constituting fraud must be pled with specificity, and all the essential elements of fraudulent conduct must be stated." Zikofsky v. Robby Vapor Systems, Inc., 846 So.2d 684, 684 (Fla. 4th DCA 2003) (citation omitted).

3. The party seeking to use the defense of fraud must specifically identify misrepresentations or omissions of fact. Cocoves v. Campbell, 819 So.2d 910 (Fla. 4th DCA 2002).

4. Fraud must be pled with particularity. Cocoves v. Campbell, 819 So.2d 910 (Fla. 4th DCA 2002); Thompson v. Bank of New York, 862 So.2d 768 (Fla. 4th DCA 2003).

5. Mere statements of opinion are insufficient to constitute the defense of fraud. Thompson v. Bank of New York, 862 So.2d 768 (Fla. 4th DCA 2003); Carefree Vills. Inc. v. Keating Props., Inc., 489 So.2d 99, 102 (Fla. 2d DCA 1986).

6. The elements of fraudulent misrepresentation are: "(1) a false statement concerning a material fact; (2) the representor's knowledge that the representation is false; (3) an intention that the representation induce another to act on it; and (4) consequent injury by the party acting in reliance on the representation." Butler v. Yusem, 44 So. 3d 102, 105 (Fla. 2010).

7. "Justifiable reliance is not a necessary element of fraudulent misrepresentation." Butler v. Yusem, 44 So. 3d 102, 105 (Fla. 2010).

335(b) AFFIRMATIVE DEFENSE--NEGLIGENT MISREPRESENTATION

The committee recognizes that some authority exists suggesting that negligent misrepresentation can be asserted as an affirmative defense to a breach of contract claim. See Rocky Creek Retirement Properties, Inc. v. Estate of Fox ex rel. Bank of America, N.A., 19 So.3d 1105 (Fla. 2d DCA 2009). However, the law supporting this defense has not been sufficiently developed to enable the committee to propose an instruction on this defense. Pending further development in the law, the committee takes no position on this issue.

336 AFFIRMATIVE DEFENSE--WAIVER

(Defendant) claims that [he] [she] [it] did not have to (insert description of performance) because (claimant) gave up [his] [her] [its] right to have (defendant) perform [this] [these] obligation[s]. This is called a "waiver."

To establish this defense, (defendant) must prove all of the following:

1. (Claimant's) right to have (defendant) (insert description of performance) actually existed;

2. (Claimant) knew or should have known [he] [she] [it] had the right to have (defendant) (insert description of performance); and

3. (Claimant) freely and intentionally gave up [his] [her] [its] right to have (defendant) (insert description of performance).

A waiver may be oral or written or may arise from conduct which shows that (claimant) gave up that right.

If (defendant) proves that (claimant) gave up [his] [her] [its] right to have (defendant) (insert description of performance), then (defendant) was not required to perform [this] [these] obligation[s].

NOTES ON USE

1. "Waiver" is the voluntary and intentional relinquishment of a known right. Raymond James Fin. Servs., Inc. v. Saldukas, 896 So.2d 707, 711 (Fla. 2005); Bueno v. Workman, 20 So.3d 993 (Fla. 4th DCA 2009); Winans v. Weber, 979 So.2d 269 (Fla. 2d DCA 2007).

2. The elements necessary to establish waiver are: the existence of a right, privilege, or advantage; the actual or constructive knowledge thereof; and an intention to relinquish that right, privilege, or advantage. Bueno v. Workman, 20 So.3d 993 (Fla. 4th DCA 2009); Winans v. Weber, 979 So.2d 269 (Fla. 2d DCA 2007).

3. There can be no waiver if the party against whom the waiver is invoked did not know all of the material facts, or was misled about the material facts. Winans v. Weber, 979 So.2d 269 (Fla. 2d DCA 2007); L.R. v. Dep t of Children & Families, 822 So.2d 527, 530 (Fla. 4th DCA 2002).

4. Proof of the elements of waiver may be express or implied from conduct or acts that lead a party to believe a right has been waived. RaymondJamesFin. Servs., Inc. v. Saldukas, 896 So.2d 707, 711 (Fla. 2005); LeNeve v. Via S. Fla., L.L.C., 908 So.2d 530, 535 (Fla. 4th DCA 2005).

337 AFFIRMATIVE DEFENSE--NOVATION

To establish the defense of novation, (defendant) must prove that all parties agreed, by words or conduct, to cancel the original contract and to substitute a new contract in its place.

NOTES ON USE

If necessary, Instruction 302 (Contract Formation--Essential Factual Elements) should be read in whole or in part at this point to address the issue of formation of the new contract.

350 Introduction to Contract Damages

If you find for (defendant), you will not consider the matter of damages. But, if you find for (claimant), you should award (claimant) an amount of money that the greater weight of the evidence shows will fairly and adequately compensate (claimant) for [his] [her] [its] damages. You shall consider the following type(s) of damages:

351 BREACH OF CONTRACT DAMAGES

a. Compensatory damages:

Compensatory damages is that amount of money which will put (claimant) in as good a position as [he] [she] [it] would have been if (defendant) had not breached the contract and which naturally result from the breach.

NOTES ON USE

1. Capitol Environmental Svcs., Inc. v. Earth Tech, Inc., 25 So.3d 593, 596 (Fla. 1st DCA 2009) ("It is well-settled that the injured party in a breach of contract action is entitled to recover monetary damages that will put it in the same position it would have been had the other party not breached the contract.").

2. Sharick v. Se. University of the Health Sciences, Inc., 780 So.2d 136, 139 (Fla. 3d DCA 2000) ("Damages recoverable by a party injured by a breach of contract are those which would naturally result from the breach and can reasonably be said to have been contemplated by the parties at the time the contract was made.").

b. Special damages:

Special damages is that amount of money which will compensate (claimant) for those damages which do not normally result from the breach of contract. To recover special damages, (claimant) must prove that when the parties made the contract, (defendant) knew or reasonably should have known of the special circumstances leading to such damages.

NOTES ON USE

1. Land Title of Central Fla., LLC v. Jimenez, 946 So.2d 90, 93 (Fla. 5th DCA 2006) ("Special damages are those that do not necessarily result from the wrong or breach of contract complained of, or which the law does not imply as a result of that injury, even though they might naturally and proximately result from the injury. More succinctly, special damages are damages that do not follow by implication of law merely upon proof of the breach.") (citations omitted).

2. Hardwick Properties, Inc. v. Newbern, 711 So.2d 35, 40 (Fla. 1st DCA 1998) ("[S]pecial damages are not likely to occur in the usual course of events, but may reasonably be supposed to have been in contemplation of the parties at the time they made the contract. Special damages consist of items of loss which are peculiar to the party against whom the breach was committed and would not be expected to occur regularly to others in similar circumstances.") (citation and internal quotations omitted).

3. Hardwick, 711 So.2d at 40 ("Similarly, consequential damages do not arise within the scope of the immediate buyer-seller transaction, but rather stem from losses incurred by the non-breaching party in its dealings, often with third parties, which were a proximate result of the breach, and which were reasonably foreseeable by the breaching party at the time of contracting.") (citation and internal quotations omitted).

4. Lanzalotti v. Cohen, 113 So.2d 727, 731 (Fla. 3d DCA 1959) ("Recovery may include special damages which are reasonably and necessarily incurred as a proximate result of the failure of the lessor or sublessor to perform his contract to make a lease or sublease, and such as should reasonably have been contemplated by the parties.").

5. Fla. E. Coast Railway Co. v. Peters, 83 So. 559, 563 (Fla. 1919) ("If the owner of the goods would charge the carrier with any special damages, he must have communicated to the carrier all the facts and circumstances of the case which do not ordinarily attend the carriage or the particular character and value of the property carried, for otherwise such peculiar circumstances cannot be contemplated by the carrier.") (citation omitted).

352 LOST PROFITS

To be entitled to recover lost profits, (claimant) must prove both of the following:

1. (Defendant's) actions caused (claimant) to lose profits; and

2. (Claimant) can establish the amount of [his] [her] [its] lost profits with reasonable certainty.

For (claimant) to establish the amount of [his] [her] [its] lost profits with reasonable certainty, [he] [she] [it] must prove that a reasonable person would be satisfied that the amount of lost profits which [he] [she] [it] may be entitled to recover is not simply the result of speculation or guessing. Instead, (claimant) must prove that there is some standard by which the amount of lost profits may be established. (Claimant) does not have to be able to prove that the amount of lost profits can be calculated with mathematical precision as long as [he] [she] [it] has shown there is a reasonable basis for determining the amount of the loss.

[Even though (claimant's) business is not established or does not have a "track record," [he] [she] [it] still may be able to establish the amount of lost profits which [he] [she] [it] may be entitled to recover if [he] [she] [it] proves that there is some standard by which the amount of lost profits may be established.]

NOTE ON USE

Provide the bracketed language if the claimant's business is not established or does not have a "track record."

SOURCES AND AUTHORITY

1. River Bridge Corp. v. Am. Somax Ventures ex rel. Am. Home Development Corp., 18 So.3d 648, 650 (Fla. 4th DCA 2009) ("When a party seeks lost future profits based upon a breach of contract or other wrong, the party must prove that the lost profits were a direct result of the defendant's actions and that the amount of the lost profits can be established with reasonable certainty.") (citation and internal quotations omitted).

2. Levitt-ANSCA Towne ParkP 'ship v. Smith & Co., 873 So.2d 392, 396 (Fla. 4th DCA 2004) ("Lost profits must be proven with a reasonable degree of certainty before they are recoverable. The mind of a prudent impartial person should be satisfied that the damages are not the result of speculation or conjecture.") (citation and internal quotations omitted).

3. Marshall Auto Painting & Collision, Inc. v. Westco Eng'g, Inc., 2003 WL 25668018 n.7 (M.D. Fla. 2003) ("[T]he Florida Supreme Court has stated that a business can recover lost prospective profits [if] ... there is some standard by which the amount of the damages may be adequately determined .... The requisite ... allowance [for lost profits] is some standard, such as regular market values, or other established data, by reference to which the amount may be satisfactorily established.") (citations and internal quotation marks omitted).

W.W. Gay Mechanical Contractor, Inc. v. Wharfside Two, Ltd., 545 So.2d 1348, 1351 (Fla. 1989) ("A business can recover lost prospective profits regardless of whether it is established or has any 'track record.' The party must prove that 1) the defendant's action caused the damage and 2) there is some standard by which the amount of damages may be adequately determined.").

354 Owner's Damages for Breach of Contract to Construct Improvements on Real Property

The amount of damages recoverable for breach of a contract to construct improvements on real property is:

a. In cases where the defendant does not contend that the damages claimed by the claimant constitute unreasonable economic waste:

The reasonable cost to (claimant) of completing the work in accordance with the contract less the balance due under the contract.

b. In cases where the defendant contends that the damages claimed by the claimant constitute unreasonable economic waste:

If construction and completion in accordance with the contract would not involve unreasonable economic waste, the reasonable cost to (claimant) of completing the work in accordance with the contract less the balance due under the contract;

or

If construction and completion in accordance with the contract would involve unreasonable economic waste, the difference between the fair market value of (claimant's) real property as improved and its fair market value if (defendant) had constructed the improvements in accordance with the contract, measured at the time of the breach.

NOTES ON USE

1. In Grossman Holdings Ltd. v. Hourihan, 414 So.2d 1037, 1039 (Fla. 1982), the Florida Supreme Court adopted Section 346 of the Restatement (First) of Contracts (1932), which provides, in relevant part:

For a breach by one who has contracted to construct a specified product, the other party can get judgment for compensatory damages for all unavoidable harm that the builder had reason to foresee when the contract was made, less such part of the contract price as has not been paid and is not still payable, determined as follows:

(a) For defective or unfinished construction he can get judgment for either

(i) the reasonable cost of construction and completion in accordance with the contract, if this is possible and does not involve unreasonable economic waste; or

(ii) the difference between the value that the product contracted for would have had and the value of the performance that has been received by the plaintiff, if construction and completion in accordance with the contract would involve unreasonable economic waste.

2. Heine v. Parent Construction, Inc., 4 So.3d 790, 792 (Fla. 4th DCA 2009) ("The [Florida] [S]upreme [C]ourt ... adopted section 346(1)(a) of the Restatement (First) of Contracts (1932) as the law for the measure of damages in a claim for breach of a construction contract.").

3. Centex-Rooney Construction Co. v. Martin Cnty., 706 So.2d 20, 27 (Fla. 4th DCA 1997) ("In a case involving the breach of a construction contract, a recognized measure of damages is the reasonable cost of performing construction and repairs in conformance with the original contract's requirements.").

355 Obligation to Pay Money Only

To recover damages for the breach of a contract to pay money, (claimant) must prove the amount due under the contract.

NOTES ON USE

See Murciano v. Garcia, 958 So.2d 423, 423 (Fla. 3d DCA 2007) ("[T]o prevail on a breach of contract action, [a plaintiff] must prove (1) a valid contract; (2) a material breach; and (3) damages.").

356 Buyer's Damages for Breach of Contract for Sale of Real Property

To recover damages for the breach of a contract to sell real property, (claimant) must prove that [he] [she] [it] was ready, willing, and able to perform the contract.

If (claimant) proves that [he] [she] [it] was ready, willing, and able to perform the contract, then (claimant) may recover:

1. The amount of any payment made by (claimant) toward the purchase price; and

2. The amount of any reasonable expenses for examining title.

If (claimant) also proves that (defendant) acted in bad faith in breaching the contract or that (defendant) sold the property to a third-party after entering into the contract, then (claimant) also may recover the difference between the fair market value of the property on the date of the breach and the contract price.

NOTES ON USE

1. In Gassner v. Lockett, 101 So.2d 33, 34 (Fla. 1958), the Florida Supreme Court, quoting Key v. Alexander, 108 So. 883, 885 (Fla. 1926), stated (emphasis and internal quotations omitted):

The law is well settled that in an action brought by the vendee against the vendor upon a valid contract for the sale of land when the vendor has breached such contract, the general rule as to the measure of damages is that the vendee is entitled to such purchase money as he paid, together with interest and expenses of investigating title. This rule, however, does not apply where there is a want of good faith in the vendor, which may be shown by any acts inconsistent with the utmost good faith. In such cases, or in cases where the vendor had no title but acting on the supposition that he might acquire title, he is liable for the value of the land at the time of the breach with interest from that date ....

The reason for the rule seems to be that where a vendor acts in good faith he should not be liable for more than the actual loss which might be suffered by the vendee. On the other hand, there is no reason why the vendor should be allowed to benefit from such mistake even though it was made in good faith. Every rule of logic and justice would seem to indicate that where a vendor is unable to perform a prior contract for the sale of lands because of a subsequent sale of the same land, he should be held, to the extent of any profit in the subsequent sale, to be a trustee for the prior vendee and accountable to such vendee for any profit.

2. Wolofsky v. Behrman, 454 So.2d 614, 615 (Fla. 4th DCA 1984) ("Florida has long since aligned itself with the English rule announced in Flureau v. Thornhill, 2 W.Bl. 1078, 96 Eng.Rep. 635, to the effect that, except where a vendor has acted in bad faith, his liability for breach of a land sale contract is limited to the amount of the deposit paid by the purchaser, with interest and reimbursement for expenses in investigating title to the property. However, absent good faith, he is liable for full compensatory damages, including the loss of his bargain, which is the difference between the value of the property and the contract price.").

3. Horton v. O 'Rourke, 321 So.2d 612, 613 (Fla. 2d DCA 1975) ("[I]n the absence of bad faith the damages recoverable for breach by the vendor of an executory contract to convey title to real estate are the purchase money paid by the purchaser together with interest and expenses of investigating title.").

4. Port Largo Club, Inc. v. Warren, 476 So.2d 1330, 1333 (Fla. 3d DCA 1985) ("Where bad faith exists a purchaser may obtain, as a portion of his full compensatory damages, loss of bargain damages, i.e., the difference between the contract price and the value of the property on the closing date.").

5. Bosso v. Neuner, 426 So.2d 1209, 1212 (Fla. 4th DCA 1983) ("However, where bad faith exists the purchaser may obtain loss of bargain damages which is the difference in value between the price the purchaser had agreed to pay and the value of the property on the contracted date for closing.").

6. Coppola Enterprises, Inc. v. Alfone, 531 So.2d 334, 335-36 (Fla. 1988) ("A seller will not be permitted to profit from his breach of a contract with a buyer, even absent proof of fraud or bad faith, when the breach is followed by a sale of the land to a subsequent purchaser.").

7. Hollywood Mall, Inc. v. Capozzi, 545 So.2d 918, 921 (Fla. 4th DCA 1989) ("To obtain damages for anticipatory breach of contract, the purchaser must also show that he was ready, willing, and able to perform the contract.") (citing Hospital Mortgage Group v. First Prudential Dev. Corp., 411 So.2d 181 (Fla. 1982)).

357 Seller's Damages for Breach of Contract to Purchase Real Property

To recover damages for the breach of a contract to buy real property, (claimant) must prove that [he] [she] [it] performed, or had the ability to perform, all of [his] [her] [its] obligations necessary for closing.

If (claimant) proves that [he] [she] [it] performed, or had the ability to perform, all of [his] [her] [its] obligations necessary for closing, then (claimant) may recover:

1. The difference between the contract sales price and the fair market value of the property on the date of the breach, less any amount which (defendant) previously paid; and

2. Any damages which the parties contemplated when the parties made the contract and which normally result from the breach of contract.

NOTES ON USE

This instruction is to be given where the contract does not contain a liquidated damages provision or where the liquidated damages provision has been determined to be unenforceable.

SOURCES OF AUTHORITY

1. Pembroke v. Caudill, 37 So.2d 538, 541 (Fla. 1948) (abrogated on other grounds by Hutchison v. Tompkins, 259 So.2d 129, 130 (Fla. 1972)) ("[T]he measure of the sellers' damage ordinarily being in such cases [where the buyer breaches the contract] the difference between the agreed purchase price and the actual value of the property at the time of the breach of the contract of purchase, less the amount paid.")

2. Buschman v. Clark, 583 So.2d 799, 800 (Fla. 1st DCA 1991) ("[T]he measure of damages for breach of a real estate sales contract is the difference between the contract sales price and the fair market value of the property on the date of the breach. All additional damages must be alleged and proved to have been contemplated by the parties and must be a natural and proximate result of the breach.") (citing Zipper v. Affordable Homes, Inc., 461 So.2d 988 (Fla. 1st DCA 1984)).

3. When the seller elects to sue for breach of contract, "the measure of damages is the difference between the price the buyer agreed to pay for the property and the fair market value of the property on the date of the breach." Frank Silvestri, Inc. v. Hilltop Developers, Inc., 418 So.2d 1201, 1203 (Fla. 5th DCA 1982). "If a seller has suffered additional damage, he must allege and prove that those damages were contemplated by the parties and were a natural and proximate result of the breach." Id. at 1203 n.1.

4. Redmond v. Prosper, Inc., 364 So.2d 812, 813 (Fla. 3d DCA 1978) (proper measure of damages for breach of real estate contract is "the excess of the contract sales price over the market value as of the time of the breach, less the amount previously paid").

5. Popwell v. Abel, 226 So.2d 418, 422 (Fla. 4th DCA 1969) ("In the ordinary case where a purchaser of land breaches his contract to buy, the difference between the value of the land on the date of breach as compared with the date of sale would restore the vendor, but the vendor may still allege and prove as proper elements of damage all those damages contemplated by the parties which are a natural and proximate result of the breach.").

6. Cohen v. Champlain TowersN. Assocs., 452 So.2d 989, 991 (Fla. 3d DCA 1984) (seller must show ability to perform all conditions precedent to recover damages) (citing Hosp. Mortgage Group v. First Prudential Dev. Corp., 411 So.2d 181 (Fla. 1982)).

358 Mitigation of Damages

If (defendant) breached the contract and the breach caused damages, (claimant) is not entitled to recover for those damages which (defendant) proves (claimant) could have avoided with reasonable efforts or expenditures. You should consider the reasonableness of (claimant's) efforts in light of the circumstances facing [him] [her] [it] at the time, including [his] [her] [its] ability to make the efforts or expenditures without undue [risk] [burden] [or] [humiliation].

If (claimant) made reasonable efforts to avoid the damages caused by the breach, then your award should include reasonable amounts that [he] [she] [it] spent for this purpose.

NOTES ON USE

This instruction is intended primarily for use in exclusive contract cases when the defense of mitigation of damages has been asserted, as non-exclusive contracts are generally considered an exception to the doctrine of avoidable consequences. See Graphic Assocs., Inc. v. Riviana Rest. Corp., 461 So.2d 1011, 1014 (Fla. 4th DCA 1984); Calimari and Perillo, THE LAW OF CONTRACTS [section]14-16. This instruction does not use the somewhat inaccurate term "duty to mitigate" damages because "[t]here is no actual 'duty to mitigate,' because the injured party is not compelled to undertake any ameliorative efforts." Sys. Components Corp. v. Fla. Dep t of Transp., 14 So.3d 967, 982 (Fla. 2009).

SOURCES AND AUTHORITY

1. Sys. Components Corp. v. Fla. Dep'tof Transp., 14 So.3d 967, 982 (Fla. 2009) ("The doctrine of avoidable consequences ... commonly applies in contract and tort actions. ... The doctrine does not permit damage reduction based on what 'could have been avoided' through Herculean efforts. Rather, the injured party is only accountable for those hypothetical ameliorative actions that could have been accomplished through 'ordinary and reasonable care' without requiring undue effort or expense.") (internal citations omitted).

2. Graphic Associates, Inc. v. Riviana Rest. Corp., 461 So.2d 1011, 1014 (Fla. 4th DCA 1984) ("The doctrine of avoidable consequences, commonly referred to as a duty to mitigate damages, prevents a party from recovering those damages inflicted by a wrongdoer which the injured party 'could have avoided without undue risk, burden, or humiliation.'") (citation omitted).

3. RESTATEMENT (SECOND) OF CONTRACTS [section]350 (1981) ("(1) Except as stated in Subsection (2), damages are not recoverable for loss that the injured party could have avoided without undue risk, burden or humiliation. (2) The injured party is not precluded from recovery by the rule stated in Subsection (1) to the extent that he has made reasonable but unsuccessful efforts to avoid loss.").

359 Present Cash Value of Future Damages

Any amount of damages which you award for future damages should be reduced to its present money value and only the present money value of these future damages should be included in your verdict.

The present money value of future damages is the sum of money needed now which, together with what that sum will earn in the future, will compensate (claimant) for these damages as they are actually experienced in future years.

NOTES ON USE

1. Designing a standard instruction for reduction of damages to present value is complicated by the fact that there are several different methods used by economists and courts to arrive at a present-value determination. See, e.g., Delta Air Lines, Inc. v. Ageloff, 552 So.2d 1089 (Fla. 1989), and Renuart Lumber Yards v. Levine, 49 So.2d 97 (Fla. 1950) (using approach similar to calculation of cost of annuity); Jones & Laughlin Steel Corp. v. Pfeifer, 462 U.S. 523 (1983), and Loftin v. Wilson, 67 So.2d 185 (Fla. 1953) (lost stream of income approach); Beaulieu v. Elliott, 434 P.2d 665 (Alaska 1967) (total offset method); Culver v. Slater Boat Co., 688 F.2d 280 (5th Cir. 1982), and Seaboard Coast Line Railroad v. Garrison, 336 So.2d 423 (Fla. 2d DCA 1976) (discussing real interest rate discount method and inflation/market rate discount methods); and Bould v. Touchette, 349 So.2d 1181 (Fla. 1977) (even without evidence, juries may consider effects of inflation).

2. Until the Supreme Court or the legislature adopts one approach to the exclusion of other methods of calculating present money value, the committee assumes that the present value of future damages is a finding to be made by the jury on the evidence; or, if the parties offer no evidence to control that finding, that the jury properly resorts to its own common knowledge as guided by this instruction and by argument. See Seaboard Coast Line R.R. v. Burdi, 427 So.2d 1048 (Fla. 3d DCA 1983).

360 Nominal Damages

If you decide that (defendant) breached the contract but also that (claimant) did not prove any loss or damage, you may still award (claimant) nominal damages such as one dollar.

NOTES ON USE

1. AMC/Jeep of Vero Beach, Inc. v. Funston, 403 So.2d 602, 605 (Fla. 4th DCA 1981) ("While there is a legal remedy for every legal wrong and, thus, a cause of action exists for every breach of contract, an aggrieved party who has suffered no damage is only entitled to a judgment for nominal damages.").

2. Dep't of Transp. v. Weisenfeld, 617 So.2d 1071, 1086 (Fla. 5th DCA 1993) ("Whenever the intentional invasion of a legal right occurs the law infers some damage to the party whose rights were violated and if no evidence is adduced as to any particular specific loss or damage, the law 'rights' or remedies the wrong by awarding nominal damages, usually in the amount of $1.00.").

370 GOODS SOLD AND DELIVERED

(Claimant) claims that (defendant) owes [him] [her] [it] money for goods which (claimant) sold and delivered to (defendant). To establish this claim, (claimant) must prove all of the following:

1. (Claimant) sold and delivered goods to (defendant);

2. (Defendant) failed to pay for such goods; and

3. [The price agreed upon for] [The reasonable value of] the goods which (claimant) sold and delivered to (defendant).

If the greater weight of the evidence does not support (claimant's) claim on these issues, then your verdict should be for (defendant). However, if the greater weight of the evidence supports (claimant's) claims on these issues, then your verdict should be for (claimant) in the total amount of [his] [her] [its] damages.

NOTES ON USE

See Chase & Co. v. Miller, 88 So. 312, 314 (Fla. 1921); Bosem v. A.R.A. Corp., 350 So. 2d 526, 527 (Fla. 3d DCA 1977); Alderman Interior Sys., Inc. v. First National-Heller Factors, Inc., 376 So. 2d 22, 24 (Fla. 2d DCA 1979); Florida Rule of Civil Procedure 1.935; Florida Small Claims Rule Form 7.331; Amendments to the Florida Rules ofCivil Procedure, 773 So. 2d 1098 (Fla. 2000); Marc A. Wites, Florida Causes of Action [section] 4:110.1.

371 OPEN ACCOUNT

(Claimant) claims that (defendant) owes [him] [her] [it] money on an open account. An open account is an unsettled debt arising from [items of work and labor] [goods sold and delivered] where the parties have had [a transaction] [transactions] between them and expected to conduct further transactions. To establish this claim, (claimant) must prove all of the following:

1. (Claimant) and (defendant) had [a transaction] [transactions] between them;

2. An account existed between (claimant) and (defendant) in which the parties had a series of charges, payments, adjustments;

3. (Claimant) prepared an itemized statement of the account; and

4. (Defendant) owes money on the account.

If the greater weight of the evidence does not support (claimant's) claim on these issues, then your verdict should be for (defendant). However, if the greater weight of the evidence supports (claimant's) claim on these issues, [then your verdict should be for (claimant) in the total amount of [his] [her] [its] damages] [then you shall consider the [defense] [defenses] raised by (defendant)].

NOTES ON USE

See Farley v. Chase Bank, U.S.A., N.A., 37 So. 3d 936, 937 (Fla. 4th DCA 2010); S. Motor Co. of Dade Cnty. v. Accountable Const. Co., 707 So. 2d 909, 912 (Fla. 3d DCA 1998); Central Ins. Underwriters, Inc. v. National Ins. Fin. Co., 599 So. 2d 1371, 1373 (Fla. 3d DCA 1992); Robert W. Gottfried, Inc. v. Cole, 454 So. 2d 695, 696 (Fla. 4th DCA 1984); Hawkins v. Barnes, 661 So. 2d 1271, 1273 (Fla. 5th DCA 1995); Fla. R. Civ. P. 1.932 (Form) ("A copy of the account showing items, time of accrual of each, and amount of each must be attached" to the Complaint); and Myrick v. St. Catherine Laboure Manor, Inc., 529 So. 2d 369, 371 (Fla. 1st DCA 1988) (calling into question sufficiency of a complaint where copy of statement attached to the complaint fails to show the individual items making up the account and the time of accrual and amount of each, as the cited form requires). But see Evans v. Delro Industries, Inc., 509 So. 2d 1262, 1263 (Fla. 1st DCA 1987) (purportedly an action for "open account," but requiring proof of sales contract, proof of sales price or reasonable value of goods delivered, and proof of actual delivery) (citing Chase & Co. v. Miller, 88 So. 312 (Fla. 1921) (an action involving common counts for goods bargained and sold and goods sold and delivered) and Alderman Interior Systems, Inc. v. First National-Heller Factors, Inc., 376 So. 2d 22 (Fla. 2d DCA 1979) (same)).

372 ACCOUNT STATED

(Claimant) claims that (defendant) owes [him] [her] [it] money on an account stated. An account stated involves a transaction or series of transactions for which a specific amount of money is due. To establish this claim, (claimant) must prove all of the following:

1. (Claimant) and (defendant) had [a transaction] [transactions] between them;

2. [(Claimant) and (defendant) agreed upon the balance due] [or] [(Claimant) rendered a statement to (defendant) and (defendant) failed to object within a reasonable time to a statement of [his] [her] [its] account];

3. (Defendant) expressly or implicitly promised to pay (claimant) [this balance] [the amount set forth in the statement]; and

4. (Defendant) has not paid (claimant) [any] [all] of the amount owed under the account.

If the greater weight of the evidence does not support (claimant's) claim on these issues, then your verdict should be for (defendant). However, if the greater weight of the evidence supports (claimant's) claim on these issues, [then your verdict should be for (claimant) in the total amount of [his] [her] [its] damages] [then you shall consider the [defense] [defenses] raised by (defendant)].

NOTES ON USE

1. There must be an agreement between the parties that a certain balance is correct and due and an express or implicit promise to pay this balance. Merrill-Stevens Dry Dock Co. v. Corniche Exp., 400 So. 2d 1286 (Fla. 3d DCA 1981).

2. The action for an account stated is an action for a sum certain, and where there is no such agreement between the parties, the plaintiff may not recover upon a theory of account stated. Id.; FDIC v. Brodie, 602 So. 2d 1358, 1361 (Fla. 3d DCA 1992); Carpenter Contractors of America, Inc. v. Fastener Corp. of America, Inc., 611 So. 2d 564, 565 (Fla. 4th DCA 1992).

3. An account statement is not absolutely conclusive upon the parties as the presumption of the account's accuracy and correctness may be overcome by proof of fraud, mistake, or error. Farley v. Chase Bank, U.S.A., N.A., 37 So. 3d 936, 937 (Fla. 4th DCA 2010).

4. An agreement to a resulting balance may be established by the failure to object to the account statement. See Myrick v. St. Catherine Laboure Manor, Inc., 529 So. 2d 369, 371 (Fla. 1st DCA 1988).

5. An objection to an account must be made within a reasonable time. Robert C. Malt & Co. v. Kelly Tractor Co., 518 So. 2d 991, 992 (Fla. 4th DCA 1988).

6. Fla. R. Civ. P. 1.933 (Form) ("A copy of the account showing items, time of accrual of each, and amount of each must be attached" to the Complaint).

373 MONEY HAD AND RECEIVED

(Claimant) claims that (defendant) has received money which [he] [she] [it] ought to refund to (claimant). To establish this claim, (claimant) must prove all of the following:

1. (Defendant) received (claimant's) money;

2. (Defendant) received the money as the result of [insert brief summary of basis of claim]; and

3. The circumstances are such that (defendant) should, in all fairness, be required to return the money to (claimant).

NOTES ON USE

1. The common law action for money had and received derives from the common law action of assumpsit. The action is used to recover money which a defendant erroneously receives in circumstances where it would be unjust for the defendant to retain the money. While this is a legal action, it draws "upon the equitable principle that no one ought to be unjustly enriched at the expense of another." Sharp v. Bowling, 511 So. 2d 363, 364-65 (Fla. 5th DCA 1987).

2. A claim for money had and received may be based upon a wide variety of grounds including: (1) upon consideration which has failed, Deco Purchasing & Distributing Co. v. Panzirer, 450 So. 2d 1274, 1275 (Fla. 5th DCA 1984); (2) for money paid by mistake, First State Bank of Fort Meade v. Singletary, 169 So. 407 (Fla. 1936); (3) for money obtained through imposition, extortion, or coercion, Cullen v. Seaboard Air Line R. Co., 58 So. 182, 184 (Fla. 1912); or (4) where defendant had taken undue advantage of claimant's situation, Moss v. Condict, 16 So. 2d 921, 922 (Fla. 1944). The foregoing list is not exclusive, and a claim for money had and received may be based upon any set of facts "which show that an injustice would occur if money were not refunded." Moore Handley, Inc. v. Major Realty Corp., 340 So. 2d 1238, 1239 (Fla. 4th DCA 1976).
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Publication:Florida Bar News
Date:Dec 15, 2011
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