September 17, 2010

Trial Attorneys Take Note – 57.105 Motion Overturned and Express Malice for Defamation Expanded

The issue was whether the trial court abused its discretion in ordering our client and our client’s attorney to pay 57.105 attorney’s fees in a defamation action.

Our client sued the opposing party for defamation after being forced out of business by the opposing party’s outrageous allegation that our client, a jeweler, replaced diamonds from the opposing party’s ring with cubic zirconias. Even though our client vehemently denied the accusation, the opposing party filed a police report accusing our client of replacing the diamonds with artificial stones. Several days later, however, the opposing party contacted the police to notify them that the diamonds in the ring were not swapped but were the original diamonds. Nevertheless, the opposing party moved for summary judgment and 57.105 attorney’s fees, against our client and our client’s attorney, stating that the accusation was believed to be true and our client failed to show malice. The trial court granted the summary judgment and the 57.105 fees reasoning that the opposing party was entitled to a qualified privilege for reporting a crime to the police.

The Fourth District Court of Appeal reversed the trial court’s 57.105 award and hinted that summary judgment was inappropriate. Specifically, the court noted that when a trial court grants an award of 57.105 attorney’s fees, “the reviewing court must determine whether the trial court abused its discretion in finding no justifiable issues of law or fact.”  In other words, the court held that “[a] case is frivolous” justifying the award of fees, “when it can be said to be ‘completely without merit in law’ or ‘contradicted by overwhelming evidence.’” As applied to our client, the court found that express malice may be inferred from the opposing party’s unreasonable conduct in accusing our client of stealing the diamonds and then, without ever investigating the matter, filing a police report. The court noted that, at the time the opposing party filed the report accusing our client of theft, the opposing party made no attempt to find out if the accusation was true. The court concluded that there was a reasonable inference that the opposing party intended to harm our client by getting the police involved, “perhaps because of their heated exchange the day before.”

Editor’s Note: At the time of writing this blog entry, a mandate from the court had not been issued.