This post updates the blog post dated May 13, 2015.
On March 17, 2016, the Florida Supreme Court decided Santiago v. Mauna Loa Investments, LLC, No. SC13-2194 (review granted May 22, 2014), by quashing the Third District’s decision which improperly considered documents outside the complaint in determining the complaint’s sufficiency to state a cause of action. The opinion can be found here.
Anamaria Santiago leased commercial space from Mauna Loa Investments, LLC. Santiago tripped and fell on the property in 2008 and sued Mauna Loa two years later in 2010 (“Mauna complaint”). Santiago alleged that Mauna owned, maintained and/or controlled the property at the time of her fall. Mauna’s counsel never filed a responsive pleading and the trial court entered a default against Mauna. Mauna moved to set aside the default arguing that it did not own the property on the date of Santiago’s injury. In support of its argument, Mauna noted that in 2011 Santiago sued Iberia, NV, LLC seeking damages for the same injury (“Iberia complaint”). In that suit, Santiago alleged that at the time of the accident, Iberia and Antonio Martinez-Marmol owned the property and that the property was conveyed to Mauna three months after the accident. Shortly after the Iberia suit was filed, the trial court consolidated the Iberia case with the Mauna case. After a jury trial on damages, the trial court entered a final judgment against Mauna for over $1 million.
Mauna appealed to the Third District. The Third District vacated the default and the final judgment and dismissed the complaint for failure to state a claim upon which relief may be granted. The Court rested its conclusions on two rules of law. First, a default judgment cannot be entered against a defendant when the complaint fails to state a cause of action. And second, a motion to set aside a default requires no showing of excusable neglect when the motion demonstrates that the allegations in the complaint do not entitle the plaintiff to relief. The facts demonstrated that Santiago had no viable claim against Mauna because the special warranty deed attached to the Iberia complaint established that Mauna did not own the property on the date of Santiago’s injury. Santiago also admitted that Iberia owned, controlled and maintained the property at that time. To view the district court decision, which is reported at 122 So. 3d 520 (Fla. 3d DCA 2013), click here.
The Florida Supreme Court accepted review because the district court’s decision conflicted with other Florida decisions. The supreme court reaffirmed the longstanding limitations on determining the sufficiency of a complaint. Specifically, when a court determines the sufficiency of a complaint to state a cause of action, its review is limited to an examination only of the complaint and its attachments (known as the “four-corners rule”). The Court found that the district court erred by considering documents attached to the Iberia complaint to dismiss the Mauna complaint. The Court did not find the fact that the two cases were consolidated justified the district court’s ruling either. It therefore concluded that the district court erred in holding that the Mauna Loa complaint failed to state a cause of action.
The Court also concluded that the trial court did not abuse its discretion in determining that Mauna Loa failed to establish excusable neglect.