       DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                             FOURTH DISTRICT

 PETER NALASCO, Individually and on behalf of the Peter Nalasco IRA,
JOHANNE LAVOIE NALASCO, Individually and on behalf of the Johanne
         Lavoie Nalasco IRA, and LOUI JOHN NALASCO,
                           Appellants,

                                    v.

                 BUCKMAN, BUCKMAN & REID, INC.,
                            Appellee.

                              No. 4D14-861

                             [July 15, 2015]

   Appeal from the Circuit Court for the Seventeenth Judicial Circuit,
Broward County; Carol-Lisa Phillips, Judge; L.T. Case No. CACE 13-
023089 (25).

   Mark A. Tepper of Mark A. Tepper, P.A., Fort Lauderdale, for appellants.

  Mark J. Astarita of Sallah Astarita & Cox, LLC, Verona, New Jersey,
and Elaine D. Walter of Gaebe, Mullen, Antonelli & DiMatteo, Coral
Gables, for appellee.

STEVENSON, J.

   This is an appeal from a $22,000 attorney’s fee judgment in favor of the
prevailing parties in a securities arbitration case. Counsel for the
prevailing parties sought fees in the neighborhood of $300,000. The
prevailing parties have appealed, arguing, among other things, that the
findings in the judgment are inadequate. We agree and thus reverse the
fee judgment, for this reason and for others, as discussed below.

    The Underlying Case & the Attorney’s Fee Judgment
    This appeal has its genesis in the arbitration of a $30,000 securities
claim brought by the Nalascos against their broker, Buckman, Buckman
& Reid, Inc. (Broker). The arbitrator resolved the matter “on the papers”
without a hearing and awarded the Nalascos compensatory damages in
the amount of $44,737. The arbitrator also determined that Broker was
liable for the Nalascos’ attorney’s fees, pursuant to section 517.211,
Florida Statutes (2013),1 and directed the Nalascos to seek fees in the
circuit court.

    Thereafter, the Nalascos filed a petition in the circuit court, seeking
confirmation of the arbitration award and the award of attorney’s fees. The
Nalascos had entered into a contingency fee agreement with their attorney,
which allowed for a fee of “35% [o]f any recovery related to the arbitrable
claim(s)” and “45% [o]f any recovery if there are post arbitration
proceedings.”     The agreement expressly recognized, however, that
attorney’s fees may be awarded to the prevailing party and, in that event,
the fee would be the greater of that award or the amount agreed to by the
client.

   During the subsequent proceedings on attorney’s fees, the Nalascos’
counsel offered affidavits indicating he had invested 164 hours in the
arbitration proceedings and an additional 145.9 hours during the circuit
proceedings. His paralegal had spent an additional 60.7 hours on the
case. The Nalascos’ counsel took the position that Broker had waged a
“militant defense,” which served to drive up the attorney’s fees. Counsel
charged $425 per hour for his time and $125 per hour for his paralegal’s
time. The parties stipulated these hourly rates were reasonable. The
Nalascos’ attorney’s fee expert opined a multiplier of 2 was appropriate.

   In contrast, Broker had spent a total of 72 hours on the case. It argued
the number of hours invested by the Nalascos’ attorney was unreasonable
as the case was “typical” and the underlying investment account had been
active for only four months. The Broker’s fee expert opined the case was
neither factually nor legally complex and had not warranted the hours
spent by the Nalascos’ counsel. It was her opinion that the 45% of recovery
provided for in the fee agreement was a reasonable fee and that no
multiplier was warranted.

   Ultimately, the trial court entered an order awarding the Nalascos
$22,000 in attorney’s fees, looking to the fee agreement between the
Nalascos and their counsel as establishing a reasonable fee. The Nalascos
raise numerous challenges to the $22,000 fee award. Chief among the
Nalascos’ appellate arguments are their claims that the fee order must be
reversed because the trial court failed to make the findings required by

1 Section 517.211, Florida Statutes, entitled “Remedies available in cases of
unlawful sale,” provides, in relevant part, that “[i]n any action brought under this
section, including an appeal, the court shall award reasonable attorneys’ fees to
the prevailing party unless the court finds that the award of such fees would be
unjust.” § 517.211(6), Fla. Stat. (2013).

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Florida Patient’s Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985),
modified by Standard Guaranty Insurance Co. v. Quanstrom, 555 So. 2d
828 (Fla. 1990), and because the trial court erroneously treated the instant
case as a Quanstrom category 1 public policy case, rather than a category
2 tort and contract case. As we find merit in these arguments, the fee
award must be reversed and the matter remanded. We write to address
these issues and also matters concerning the recovery of fees for time
spent litigating the amount of fees and prejudgment interest.

   Rowe & Contingency Fee Multipliers
   In Rowe, the Florida Supreme Court adopted the federal lodestar
approach for determining the amount of a reasonable attorney’s fee. 472
So. 2d at 1150. The first step of that lodestar approach “requires the court
to determine the number of hours reasonably expended” and the second
step “requires the court to determine a reasonable hourly rate.” Id. at
1150. “The number of hours reasonably expended, determined in the first
step, multiplied by a reasonable hourly rate, determined in the second
step, produces the lodestar, which is an objective basis for the award of
attorney fees.” Id. at 1151.

   Once the trial court has arrived at the lodestar figure, if counsel has
been employed on a contingency basis, then the trial court must determine
whether a “contingency risk factor” multiplier is appropriate. Id. The
factors to be applied in determining whether a multiplier is appropriate
turn upon which category of cases is at issue: public policy enforcement
cases; tort and contract claims; or family law, eminent domain, and estate
and trust matters. Quanstrom, 555 So. 2d at 833. The trial court is not
required to apply a contingency multiplier, but is required only to consider
whether a multiplier is warranted. Id. at 831.

    Here, the trial court found that $22,000 was a reasonable fee without
making any findings regarding a reasonable number of hours or a
reasonable hourly rate. The trial court’s failure to make express findings
as to the reasonable number of hours and a reasonable hourly rate renders
the fee judgment “‘fundamentally erroneous on its face,’” requiring reversal
of the fee order and remand to the trial court. Delmonico v. Crespo, 127
So. 3d 576, 578–79 (Fla. 4th DCA 2012) (quoting Baratta v. Valley Oak
Homeowners’ Ass’n at the Vineyards, Inc., 891 So. 2d 1063, 1065 (Fla. 2d
DCA 2004)); see also Ingram v. Ingram, 59 So. 3d 147, 148 (Fla. 1st DCA
2011) (“In circumstances where the record may contain competent,
substantial evidence to support these specific findings, but the trial court’s
order omits such findings, the case should be remanded for entry of an
appropriate order.”).


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    Additionally, in refusing to apply a multiplier, the trial court made
findings suggesting it believed this securities case was properly treated as
a category 1 public policy enforcement case. The trial court erred in
treating the instant case as a category 1 public policy enforcement case,
rather than a category 2 tort and contract claims case. See Raymond,
James & Assocs., Inc. v. Wieneke, 591 So. 2d 956, 958 (Fla. 2d DCA 1991)
(recognizing some ambiguity but concluding that litigation concerning
securities transactions under chapter 517 does not fall under the
definition of a “public policy enforcement case”). This is potentially
significant as the use of multipliers is restricted in category 1 public policy
enforcement cases. See Lane v. Head, 566 So. 2d 508, 513 (Fla. 1990)
(Overton, J., specially concurring) (opining that “the use of a multiplier in
this category [public policy enforcement] is severely restricted”); Boardman
Petroleum, Inc. v. Tropic Tint of Jupiter, Inc., 668 So. 2d 308, 310 n.1 (Fla.
4th DCA 1996) (recognizing that, in Quanstrom, the supreme court
severely restricted the use of multipliers in public policy enforcement
cases); Meli Inv. Corp. v. O.R., 621 So. 2d 676, 677 (Fla. 3d DCA 1993)
(citing Justice Overton’s special concurrence in Lane in support of the
restrictive use of multipliers in public policy cases). Thus, on remand, the
matter of whether a category 2 tort and contract claims multiplier is
appropriate must also be reconsidered.

   Due to findings in the order appealed regarding the “50/50” “chance of
success” and the use of a multiplier, we take this opportunity to note that,
in Quanstrom, the supreme court set forth the following parameters
regarding multipliers:

      If the trial court determines that success was more likely than
      not at the outset, it may apply a multiplier of 1 to 1.5; if the
      trial court determines that the likelihood of success was
      approximately even at the outset, the trial judge may apply a
      multiplier of 1.5 to 2.0; and if the trial court determines that
      success was unlikely at the outset of the case, it may apply a
      multiplier of 2.0 to 2.5.

555 So. 2d at 834.

   Fees for Time Spent Litigating the Amount of Fees
   Citing State Farm Fire & Casualty Co. v. Palma, 629 So. 2d 830 (Fla.
1993), the trial court ruled that the Nalascos’ counsel was not entitled to
recover for any time spent litigating the amount of fees to be awarded. The
Nalascos insist the trial court erred in applying Palma to a fee award under
section 517.211. We reject their argument.


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   In Palma, which involved attorney’s fees in the context of an insurance
case, pursuant to section 627.428, Florida Statutes, the supreme court
held that, while fees incurred litigating entitlement to fees were
recoverable, fees incurred litigating the amount of fees to be awarded were
not as such services are solely to the attorney’s benefit. 629 So. 2d at 833.
In the years since Palma, its holding that attorney’s fees may not be
recovered for time spent litigating the amount of fees has been applied to
numerous fee statutes, including section 517.211, the fee statute at issue
here. See Barron Chase Sec., Inc. v. Moser, 794 So. 2d 649 (Fla. 2d DCA
2001). Pirretti v. Dean Witter Reynolds, Inc., 578 So. 2d 474 (Fla. 4th DCA
1991), cited by the Nalascos, was decided prior to Palma.

   Prejudgment Interest
   The trial court’s fee judgment made no provision for the award of
prejudgment interest. The Nalascos contend that this was error and the
judgment should have included prejudgment interest, accruing from the
date that entitlement to fees was determined. We agree. See Quality
Engineered Installation, Inc. v. Higley S., Inc., 670 So. 2d 929, 931 (Fla.
1996) (holding, in context of contractual prevailing party fee provision, that
interest accrues on attorney’s fees from the date entitlement is determined,
even though amount has not yet been set); Genser v. Reef Condo. Ass’n,
100 So. 3d 760, 761–62 (Fla. 4th DCA 2012) (applying Quality Engineered
to chapter 718 prevailing party fee award pursuant to Rowe); Olde
Discount Corp. v. Amsel, 800 So. 2d 667, 667 (Fla. 5th DCA 2001) (applying
Quality Engineered to chapter 517 fees).

   Conclusion
   The fee judgment appealed is thus reversed on the grounds discussed
herein and the matter remanded to the trial court. As to all other issues
raised but not specifically addressed, we affirm.

   Affirmed in Part; Reversed in Part; and Remanded.

CIKLIN, C.J., and KLINGENSMITH, J., concur.

                            *         *         *

   Not final until disposition of timely filed motion for rehearing.




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