07-003045FE Charles Osborne vs. Alexander J. Milanick Status: Closed Recommended Order on Wednesday, November 14, 2007.

Summary: Recommended that Respondent pay appellate attorney`s fees, entitlement attorney`s fees, and original attorney`s fees due to his false allegations against Petitioner.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CHARLES OSBORNE, )

)

Petitioner, )

)

vs. ) Case No. 07 - 3045 F E

)

ALEXANDER J. MILANICK, )

)

Respondent. )

)

RECOMMENDED ORDER ON ATTORNEY'S FEES AND COSTS

This cause came on for formal hearing before Harry L.

Hooper , Administrative Law Judge with the Division of

Administrative Hearing s , on September 28, 2007 , in Daytona

Beach , Florida.

APPEARANCES

For Petitioner: Robert J. Riggio , Esquire

R iggio & Mitchell , P.A.

400 South Palmetto Avenue

Daytona Beach , Florida 32114

For Respondent: Dr. Alexander J. Milanick, pro se

7250 A1A South

St. Augustine Shores, Florida 32080

STATEMENT OF THE ISSUE

The issue is whether R espondent should pay Petitioner's

attorney's fees and cost s, and , if so, the amount.

PRELIMINARY STATEMENT

Petitioner Charles Osborne (Mayor Osborne), the former

mayor of Beverly Beach, Florida, successfully defended an ethics

complaint filed by Dr. Alex ander J. Milanick (Dr. Milanick).

Subsequently, Mr. Osborne sought an award of attorney's fees and

costs for his defense because Dr. Milanick did not voluntarily

pay those attorney's fees and costs . The matter was referred to

the undersigned Administrati ve Law Judge who, on July 1, 2005,

recommended that the Ethics Commission (Commission) enter an

order requiring Dr. Milanick to pay M ayor Osborne $ 4,976. 00 in

attorney's fees and costs pursuant to S ubs ection 112.317(8),

Florida Statutes (2004) . This was D ivision of Administrative

Hearings Case N o. 04 - 4110 F E .

The Commission, in a Final Order Denying Attorney Fees and

Costs filed October 19, 2005, declined to approve the award of

fees and costs to Mayor Osborne, as recommended by the

Administrative Law Judge . This was set forth in Ethics

Commission Final Order Number 05 - 599.

Mayor Osborne appealed the Commission's Order to the Fifth

District Court of Appeal. Th at c ourt, in an opinion dated

February 16, 2007, conclud ed that, pursuant to S ubs ection

112.317( 8 ) , Florida Statutes (2004) , Dr. Milanick had made false

material allegations against Mayor Osborne and reversed the

action of the Commission . Specifically, the c ourt held that

Dr. Milanick falsely claimed that Mayor Osborne was oppos ed to

the annexation in to the city limits of Beverly Beach property

owned in part by Dr. Milanick , because of some personal

investment that might be diminished. This was Fifth District

Court of Appeal Case N o. 5D05 - 3954.

The c ourt remanded the matter to the Commission for entry

of an order awarding the fees and costs in favor of Mayor

Osborne. This amount , as noted above, is $4 , 976.00. Mayor

Osborne thereafter filed a Motion for Award of Attorney's Fees

and Costs before the Commission, seeking the aforesaid amount.

Dr. Milanic k opposed this Motion. The Commission forwarded that

Motion to the Division of Administrative Hearings for resolution

in a letter dated July 6, 2007. This part of the action will be

termed the Original Award of Attorney's Fees. There is nothing

left to be decided by the Administrative Law Judge with regard

to this action.

The Fifth District Court of Appeal , also on February 16,

2007, entered an Order stating, "Appellant's Motion For

Attorney's Fees, filed May 16, 2006, is granted and the above -

styled cau se is hereby remanded to the Commission on Ethics,

pursuant to Fla. R. App. P. 9.400(b) , to determine and assess

reasonable attorney's fees for this appeal."

Mayor Osborne thereafter filed a Motion for Petitioner's

Appellate Attorney's Fees and Costs befo re the Commission,

asserting that Dr. Milanick should pay to Mayor Osborne the sum

of $14,626.00 in attorney's fees and $859.70 in costs incurred

during the appeal . Dr. Milanick opposed this Motion.

The Commission forwarded that Motion to the Division of

Administrative Hearings for resolution in the letter dated

July 6, 2007 , addressing the Original Award of Attorney's Fees .

This part of the action will be termed the Appellate Attorney's

Fees . T he only question is the amount of attorney's fees and

costs that should be awarded .

Mayor Osborne also filed before the Commission a Motion for

Petitioner's Attorney's Fees and Costs Incurred in Proving

Entitlement to Fees and Costs. This Motion asserted that

Dr. Milanick should pay to Mayor Osborne $53,008.00 in

attorney's fees and $3,764.73 in costs. Dr. Milanick opposed

this Motion.

The Commission forwarded that Motion to the Division of

Administrative Hearings for resolution in the same July 6, 2007,

letter that addressed the Original Award of Attorney's Fees .

This part of the action will be termed Entitlement to

Attorney's Fees , and the issue is whether attorney's fees and

costs should be awarded, and , if so , the amount for the effort

expended to prove that Mayor Osborne was entitled to attorney's

fees and co sts as a result of having to defend against

Dr. Milanick's false allegations.

The matter was set for hearing in Daytona Beach for

September 28, 2007 . Prior to the hearing, Mayor Osborne

attempted discovery , but Dr. Milanick failed to participate.

The hea ring was held as scheduled.

At the hearing, Mayor Osborne presented the testimony of

three witnesses and offered seven exhibits into evidence.

Respondent called no witnesses and offered no exhibits into

evidence.

A Transcript was filed on October 24, 20 07. After the

hearing, Petitioner and Respondent filed their Proposed

Recommended Order s on November 5, 2007.

References to statutes are to Florida Statutes (200 4 )

unless otherwise noted.

FINDINGS OF FACT

1. Mayor Osborne was the Mayor of Beverly Be ach, Florida ,

during 1999 through 2001.

2. Dr. Milanick was a dentist who owned property

immediately north of Beverly Beach, Florida . Dr. Milanick

desired that the property be annexed into the town and initiated

annexation proceedings before the City of Beverly Beach .

3 . Mayor Osborne did not facilitate the requested

annexation during the time he served as Mayor of Beverly Beach.

Dr. Milanick alleged to the Commission that Mayor Osborne

opposed the annexation for personal, financial gain . In order

to defend himself against these false allegations , Mayor Osborne

retained Robert J. Riggio, Esquire, of the Riggio and Mitchell

firm of Daytona Beach.

The Original Award of Attorney's Fees

4. An award of attorney's fees and costs in favor of Mayor

Osborn e was recommended in D ivision of Administrative Hearings

Case N o. 04 - 4110 E . The Recommended Order stated that the amount

of attorney's fees and cost s for Mayor Osborne to defend against

Dr. Milanick's allegations was $ 4,976. 00.

5. The Commission did n ot address the amount of attorney's

fees and cost s in its Final Order , but instead held that Mayor

Osborne was not entitled to any award. Subsequently, the Fifth

District Court of Appeal found the Commission 's Final Order to

be erroneous and remanded the matter ". . . for entry of an

order making the awards recommended by the ALJ." A Mandate with

regard to the Fifth District Court of Appeal issued April 11,

2007.

6. The award recommended by the ALJ was, as stated above,

$ 4,976. 00, and that amount should be awarded by the Commission

in a Final Order.

Appellate Attorney's Fees

7. Mayor Osborne filed a Motion for Petitioner's Appellate

Attorneys' Fees and Costs before the Commission on May 10, 2007,

noting the Fifth District Court of Appeal , in its Order dated

February 16, 2007, stated that, "Appellant's Motion For

Attorney's Fees, filed May 16, 2006, is granted and the above -

styled cause is hereby remanded to the Commission . . . to

determine and assess reasonable attorney's fees for this

appeal."

8. Th e Fifth District Court of Appeal addressed only

attorney's fees. However, because Mayor Osborne's Motion sought

both attorney's fees and costs, and because the Commission sent

that Motion without special directions to the Division of

Administrative Hearin gs for resolution, it is found that the

Administrative Law Judge has jurisdiction to recommend awards of

both attorney's fees and costs expended in prosecuting the

appeal.

9. David C. Robinson, an attorney in Daytona Beach,

Florida, testified as an exper t on attorney's fees in Volusia

County, Florida. He has practiced law in Daytona Beach for 26

years and has testified in other attorney's fees cases. He is

familiar with the fees charge d by attorneys in the Daytona Beach

and Volusia County area. He know s A ttorney Robert Riggio, of

Daytona Beach, Volusia County, and A ttorney Martin Pe data , of

Deland, a town that is also located in Volusia County.

10. Mr. Robinson is found to be an expert on the subject

of reasonable attorney's fees and costs in Volusia County .

11. Mr. Robinson reviewed the bills and records relating

to the fees charged to Mayor Osborne as to the appellate filings

made by Mr. Riggio. In doin g so he considered the L odestar

approach as described in Florida Patients Compensation Fund v.

Rowe , 472 So. 2d 1145 (Fla. 1985) .

12. Mr. Robinson opined that the services performed by

Mr. Riggio in the appellate proceeding were provided in a manner

that an attorney would be reasonably expected to provide. He

reviewed the hourly rate charged by Mr. Riggi o and stated that

the reasonable rate should be $250 .00 per hour , but that

Mr. Riggio only charged $150 .00 per hour.

13. Mr. Riggio's law firm, Riggio and Mitchell, billed

Mayor Osborne for 95 hours. A small portion of the work was

accomplished by his partner Jerome D. Mitchell. Other work in

the amount of 9.4 hours was billed for paralegal work at $40 .00

per hour. The 95 hours of attorney work was billed at $150 .00

per hour for a total of $14,250 .00 , and the paralegal work

totaled $376 .00 . C osts amounted to $859.70. This resulted in a

total of $14,626 .00 for fees and $859.70 in costs.

14. Mayor Osborne paid these charges in full.

Mr. Robinson opined that the rate charged and hours expended by

Mr. Riggio in the appellate proceeding were appropriate , as were

the costs incurred . His testimony is found to be credible.

15 . As a result of Mr. Riggio's efforts, Mayor Osborne

prevailed in the appeal. It is found that Dr. Milanick caused

Mayor Osborne to pay attorney 's fees and costs in the amount of

$1 5,485.70 .

Proving Entitlement to Fees and Costs

16 . Subsequent to Dr. Milanick's allegations of misconduct

before the Commission, and after an investigation, the

Commission, in a Public Report dated September 8, 2004,

dismissed the complaint on a finding of no probable cause in the

case of Mayor Osborne.

1 7 . Pursuant to S ubs ection 112.317(8), Florida Statutes,

Mayor Osborne was entitled to be reimbursed for the attorney 's

fees and costs associated with defending himself against

Dr. Milanick' s allegations. Because Dr. Milanick did not

voluntarily remit the fees and costs expended , a hearing was

required.

18 . A hearing was held in this matter in Daytona Beach,

Florida, on May 11, 2005 . The hearing in Division of

Administrative Hearings Case N o. 04 - 4110FE , lasted an entire

day.

19 . Prior to the hearing , Mayor Osborne engaged the

services of A ttorney Martin Pe data in addition to those provided

by Mr. Riggio . Th e agreement for representation by Mr. Pedata

was reduced to writing on April 6, 2 005. The agreement provided

that Mayor Osborne would pay Mr. Pe data $250 .00 per hour for his

services and $75 .00 per hour for paralegal services.

20 . Mr. Robinson reviewed the bills and records relating

to the fees charged to Mayor Osborne for the prepar ation for and

the conduct of the hearing of May 11, 2005. Mr. Robinson stated

that the hourly rate of $250 .00 was a reasonable one for the

type of services provided by Mr. Pe data . He stated that the

number of hours ex pended by Mr. Riggio and Mr. Pe data i n

connection with this hearing was reasonable. In analyzing this

claim he used the Lodestar approach set forth in Rowe .

2 1 . Mr. Riggio and his partner Mr. Mitchell, expended

160.6 hours p roving entitlement to fees and c osts . Mr. Pedata ,

as lead attorne y in the entitlement case, expended 107 hours.

In addition, 54.2 paralegal hours were expended in proving the

entitlement case. These hours include the time up to the filing

of the appeal with the Fifth District Court of Appeal. T hese

hours also include the time spent before the Commission.

2 2 . As a result of the efforts of Mr. Riggio and

Mr. Pedata, Mayor Osborne prevailed in the entitlement hearing ,

which resulted in a Recommended Order in his favor.

2 3 . Mayor Osborne paid Mr. Riggio and Mr. Peda ta a total

of $50,840.00 for their services in proving entitlement to

attorney ' s fees. He also paid $2,168.00 for paralegal services.

Total costs amounted to $3 , 764.73, which Mayor Osborne paid.

The total fees and cost s to Mayor Osborne was $56,772.73 .

24. Mr. Robinson opined that the rate charged and hours

expended by Mr. Riggio in the appellate proceeding were

appropriate, as were the costs incurred. His testimony is found

to be credible.

25. It is found that Dr. Milanick was responsible for

Ma yor Osborne having to pay attorney 's fees and costs in the

amount of $56,772.73.

Additional fees and costs

2 6 . Mr. Riggio presented Mayor Osborne with an invoice in

the amount of $2 , 370.00 for the cost of the current proceeding.

However, the Administrat ive Law Judge is without jurisdiction to

address this claim in this proceeding .

CONCLUSIONS OF LAW

2 7 . The Division of Administrative Hearings has

jurisdiction over the subject matter of and the parties to this

proceeding. § 120.57(1), Fla. Stat. and Fl a. Admin. Code

R . 34 - 5.0291.

2 8 . S ubs ection 112.317(8), Florida Statutes, provides as

follows:

112.317. Penalties

* * *

( 8 ) In any case in which the commission

determines that a person has filed a

complaint against a public officer or

employee wi th a malicious intent to injure

the reputation of such officer or employee

by filing the complaint with knowledge that

the complaint contains one or more false

allegations or with reckless disregard for

whether the complaint contains false

allegations of f act material to a violation

of this part, the complainant shall be

liable for costs plus reasonable attorney's

fees incurred in the defense of the person

complained against, including the costs and

reasonable attorney's fees incurred in

proving entitlement to and the amount of

costs and fees. If the complainant fails to

pay such costs and fees voluntarily within

30 days following such finding by the

commission, the commission shall forward

such information to the Department of Legal

Affairs, which shall br ing a civil action in

a court of competent jurisdiction to recover

the amount of such costs and fees awarded by

the commission.

2 9 . As noted above, the sum of $4 , 976.00 has been

determined by the Fifth District Court of Appeal , and

Dr. Milanick is requi red to remit this sum to Mayor Osborne.

30 . Because the Fifth District Court of Appeal granted

Mayor Osborne's Motion for Attorney's Fees in Case

N o. 5D05 - 3954, the only question is the amount of the fees to be

awarded.

31 . S ubs ection 112.317(8), Fl orida Statutes , provides for

the award of attorney's fees and costs in certain proceedings

before the Commission.

3 2 . In Florida Patients Compensation Fund v. Rowe , 472 So.

2d 1145 (Fla. 1985), the Florida Supreme Court adopted the

criteria set forth in Disciplinary Rule 2 - 106(6) (now numbered

4 - 1.5) of the Florida Bar Code of Professional Responsibility to

be used in determining reasonable attorney's fees.

3 3 . The Florida Bar Rules Regulating the Florida Bar,

Rule 4 - 1.5(b) (1) , provides guidance when considering reasonable

attorney 's fees as follows :

(b) Factors to Be Considered in Determining

Reasonable Fees and Costs.

(1) Factors to be considered as guides in

determining a reasonable fee include:

(A) the time and labor required, the

novelty, c omplexity, and difficulty of the

questions involved, and the skill requisite

to perform the legal service properly;

(B) the likelihood that the acceptance of

the particular employment will preclude

other employment by the lawyer;

(C) the fee, or rate of fee, customarily

charged in the locality for legal services

of a comparable or similar nature;

(D) the significance of, or amount involved

in, the subject matter of the

representation, the responsibility involved

in the representation, and the results

obt ained;

(E) the time limitations imposed by the

client or by the circumstances and, as

between attorney and client, any additional

or special time demands or requests of the

attorney by the client;

(F) the nature and length of the

professional relationshi p with the client;

(G) the experience, reputation, diligence,

and ability of the lawyer or lawyers

performing the service and the skill,

expertise, or efficiency of effort reflected

in the actual providing of such services;

and

(H) whether the fee is fix ed or contingent,

and, if fixed as to amount or rate, then

whether the client’s ability to pay rested

to any significant degree on the outcome of

the representa tion.

3 4 . The Florida Bar Rules Regulating the Florida Bar,

Rule 4 - 1.5(b) (2), provides guidan ce when considering reasonable

costs as follow s:

(2) Factors to be considered as guides in

determining reasonable costs include:

(A) the nature and extent of the disclosure

made to the client about the costs;

(B) whether a specific agreement exists

bet ween the lawyer and client as to the

costs a client is expected to pay and how a

cost is calculated that is charged to a

client;

(C) the actual amount charged by third

party providers of services to the attorney;

(D) whether specific costs can be

identif ied and allocated to an individual

client or a reasonable basis exists to

estimate the costs charged;

(E) the reasonable charges for providing

in - house service to a client if the cost is

an in - house charge for services; and

(F) the relationship and past course of

conduct between the lawyer and the client.

All costs are subject to the test of

reasonableness set forth in subdivision (a)

above. When the parties have a written

contract in which the method is established

for charging costs, the costs charged

thereunder shall be presumed reasonable.

3 5 . Using the Rowe standard, as illuminated by the Rules

Regulating the Florida Bar, the attorney 's fees charged and the

amount of costs assessed for the appeal are found to be

reasonable.

36. Using the Rowe s tandard, as illuminated by the Rules

Regulating the Florida Bar, the attorney 's fees charged and the

amount of costs assessed for proving entitlement to attorney's

fees are found to be reasonable.

RECOMMENDATION

Based upon the Findings of Fact and Conclus ions of Law,

it is

RECOMMENDED that the Commission on Ethics award attorney's

fees and costs as follows:

1. The o riginal a ward of a ttorney's f ees in the amount of

$ 4,976. 00.

2. Attorney ' s fees and costs for appellate attorney ' s fees

and costs in the amount of $15,485.70.

3. Attorney 's fees and costs for proving entitlement to

fees and costs in the amount of $56,772.73.

DONE AND ENTERED this 14th day of November , 200 7 , in

Tallahassee, Leon County, Florida.

S

HARRY L. HOOPER

Administrative Law J udge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hea rings

this 14th day of November , 200 7 .

COPIES FURNISHED :

Robert J. Riggio, Esquire

Riggio & Mitchell, P.A.

400 South Palmetto Avenue

Daytona Beach, Florida 32114

Kaye Starling

Florida Commission on Ethics

Post Office Drawer 15709

Tallahassee, Florida 32317 - 5709

Dr. Alexander J. Milanick

7250 A1A South

St. Augustine Shores, Florida 32080

Phillip C. Claypool, Executive Director

and General Counsel

Commission on Ethics

3600 Maclay Boulevard, South, Suite 201

Post Office Drawer 15709

Tallahassee, Flo rida 32317 - 5709

James Peterson , Esquire

Linzie Bogan, Esquire

Office of the Attorney General

The Capitol, Plaza Level 01

Tallahassee, Florida 32399 - 1050

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions wit hin

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.