Damages for Violation of Rule 57.105 Can Be Recovered From Attorney For Single Baseless Allegation

In the recent case of Davis v. Bailynson, the Fourth DCA held that an attorney alone could be held liable for violation of Florida Statute 57.105 for making a single baseless allegation. The attorney, on behalf of his client, Kenneth Bailynson, sued the defendants-appellants for breach of fiduciary duties, alleging that they had harmed a condominium association by failing to pay their maintenance assessments and by refusing to permit the association to increase assessments. Bailynson also had alleged that the defendants-appellants harmed the association by — successfully — bringing an injunction action barring the association from increasing its maintenance charges. Bailynson alleged that the injunction prevented the association from paying its water bill.

Bailynson’s lawyer conceded that his allegation concerning the refusal to permit increased assessments was improper, but held fast to his theory that the defendants-appellants properly could be sued for their breaches of fiduciary duty in refusing to pay their maintenance. The lawyer’s theory was that the suit had been filed against the defendants-appellants not in their individual capacities, but supposedly as representatives of the association in seeking an injunction on behalf of the other members.

Under the applicable version of 57.105, monetary sanctions could not be awarded against a represented party merely because the claim would not be supported by the then-existing law to the material facts. However, the Fourth DCA held that the defendants-appellants could recover sanctions against Bailynson’s lawyer. Even though the claim relied upon 2 different factual scenarios and Bailynson’s lawyer conceded that only one of the two scenarios was improper, that alone substantiated an award of sanctions. “[I]f an action asserts a theory of liability using more than one, but separate, factual scenarios in support of the theory, and one of the factual scenarios meets the criteria for a 57.105(1) fee sanction because it is not supported by the law, the sanction must be ordered.” Here, there could not have been any conceivable liability on the part of the defendants-appellants for their seeking an injunction or voting against an assessment hike, and Bailynson’s lawyer knew it and conceded it. Sanctions therefore were proper.