No Value: MCHALE AS RECEIVER FOR JLL LOGISTIC INC, GERALD A JR vs. KNIGHTBROOK INSURANCE COMPANY

On June 22, 105 a No Value was filed involving a dispute between Mchale As Receiver For Jll Logistic Inc, Gerald A Jr, and Boltrek, William Iii, Henderson Franklin Starnes & Holt P A, Knightbrook Insurance Company, for Contracts in the District Court of Charlotte County.

Preview
Filing # 185901148 E-Filed 11/10/2023 11:38:11 AM

IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT
IN AND FOR CHARLOTTE COUNTY, FLORIDA
CIVIL DIVISION

GERARD A. MCHALE, JR., as receiver for
JLL LOGISTIC, INC.,

Plaintiff, Case No.: 20-000066-CA

KNIGHTBROOK INSURANCE COMPANY,
HENDERSON, FRANKLIN, STARNES &
HOLT, P.A., and WILLIAM BOLTREK, III,

Defendants.
/

PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT ON
DEFENDANTS BOLTREK AND HENDERSON FRANKLIN °S
FOURTH AND ELEVENTH AFFIRMATIVE DEFENSES

Plaintiff, GERARD A. MCHALE, JR. (“McHale”), as Receiver for JUL LOGISTIC, INC.

(“JLL”), pursuant to Florida Rule of Civil Procedure 1.510, hereby moves this Honorable Court

for entry of partial summary judgment in favor of McHale as to the Fourth and Eleventh

Affirmative Defenses contained in the Answer and Affirmative Defenses to [Second] Amended

Complaint filed by Defendants, WILLIAM BOLTREK, III (“Boltrek”) and HENDERSON,

FRANKLIN, STARNES & HOLT P.A. (“Henderson Franklin”) (collectively, the “Legal

Malpractice Defendants”) on February 10, 2022. In support, Plaintiff states:

Introduction

The issue presently before the Court is simple: whether a court-appointed receiver for a

defunct company has standing to sue that company’s former lawyers for legal malpractice. The

Court should answer that question in the affirmative and grant Plaintiff partial summary judgment

as to Defendants’ Fourth and Eleventh Affirmative Defenses.
Background

1 This action involves claims of legal malpractice against Henderson Franklin and

Boltrek, and an insurance bad faith claim against KnightBrook Insurance Company

(“KnightBrook”), which arose out of a lawsuit styled William H. Schmitz and Janice K. Schmitz,

as Husband and Wife v. Alexmar Pimienta Garrido, JLL Logistic, Inc., and Roberto Li, Charlotte

County Circuit Court Case Number 16-001754-CA (“the Underlying Lawsuit”).

2 On November 24, 2015, William Schmitz was severely injured in a motor vehicle

collision that occurred when a vehicle owned by JLL Logistic, Inc. (“JLL”) and driven by Alexmar

Pimienta Garrido (“Garrido”) was improperly stopped in the road at night without lights

(hereinafter, “the Collision”). Roberto Li (“Li”) was the sole owner and proprietor of JLL.

3 At the time of the Collision, JUL was insured under a commercial automobile

insurance policy issued by KnightBrook, which provided $300,000 of liability coverage.

4. Henderson Franklin and Boltrek were retained by or on behalf of KnightBrook to

represent and defend Garrido, Li, and JLL (“the Underlying Defendants”) in the claims presented

by Mr. and Mrs. Schmitz as a result of the Collision.

5 Despite the clear liability and damages, KnightBrook, Henderson Franklin, and

Boltrek failed to offer any amount to settle Mr. Schmitz’s claim against the Underlying Defendants

for almost a year after the insurance claim was presented by Mr. Schmitz. As a result, on

September 26, 2016, the Schmitzes filed suit against the Underlying Defendants.

6. In March of 2017, the Schmitzes accepted KnightBrook’s $300,000 policy limits

in exchange for a release of Li and Garrido. JLL was not released at that time.
7
Instead, the claim against JLL proceeded to mediation where the parties,

represented by counsel, agreed to a consent judgment against JLL in the amount of $3,750,000 to
resolve the claims presented by the Schmitzes. See Exhibit 1, Settlement Agreement.

8 Accordingly, on January 29, 2018, the Underlying Lawsuit concluded with a final

judgment entered against JLL only, in favor of the Schmitzes, in the amount of $3,750,000 plus

legal interest thereon (“the Final Judgment”). Dkt. 170, Ex. D.

9. After entry of the Final Judgment, the Schmitzes set the deposition of Roberto Li

on behalf
of JLL in aid of execution on the Final Judgment. Exhibit 2, { 4, Ex. C; Exhibit 3, § 4,

Ex. C.! Between December 24, 2018 and February 5, 2019, a process server made nine separate

attempts at serving Li with the subpoena for deposition, which were all unsuccessful. Ex. 2, § 5,

Ex. D; Ex. 3, 9 5, Ex. D. Thereafter, Li’s deposition was rescheduled, and a process server once

again attempted, unsuccessfully, to serve Li with a copy of the subpoena for deposition four

separate times between March 5, 2019 and March 15, 2019. Ex. 2 § 6-7, Ex. F; Ex. 3, § 6-7, Ex.

10. After months of attempting to serve Mr. Li on behalf
of JLL with a subpoena for a

deposition in aid of execution, counsel for the Schmitzes eventually moved for the appointment of

a receiver. Ex. 2 and 3.

lL. On October 28, 2019, the Court appointed Gerard A. McHale, Jr. (“McHale”) as

Receiver for JLL. See Exhibit 4.

12. Thereafter, on January 23, 2020, McHale, as Receiver for JLL, brought this legal

malpractice and insurance bad faith action against the named Defendants. Ever since, the Legal

Malpractice Defendants have steadfastly avoided addressing the merits of the legal malpractice

claims, instead claiming some sort of malfeasance on Plaintiff's part based on his counsel having

previously represented the Schmitzes in the Underlying Lawsuit.

' Exhibit 3 is the Amended Motion for Appointment of Receiver, which was filed to correct a scrivener’s
error. It is otherwise identical in substance to the original motion, which is attached as Exhibit 2.
a. First, these arguments were raised via motions to dismiss filed on March 19 and May

4, 2020, which this Court denied without prejudice to the Legal Malpractice Defendants

raising affirmative defenses related to the Receiver’s standing.

Then the Legal Malpractice Defendants unsuccessfully moved to disqualify Plaintiff's

counsel (Dkt. 115), arguing counsel’s representation of the Schmitzes from the

underlying lawsuit prohibited them from representing McHale in this lawsuit. The

Court’s order of January 21, 2022 (Dkt. 168), was affirmed by the Second District

Court of Appeals on October 7, 2022.

Now, the Legal Malpractice Defendants are rehashing the same arguments to again

argue, without any legal support, that the Plaintiff Receiver lacks standing to bring

these legal malpractice claims.

13. To resolve this issue once and for all, on March 3, 2023, this Court stayed all

discovery outside of the issues related to the Legal Malpractice Defendants’ Fourth and Eleventh

Affirmative Defenses.” The March 3rd Order imposed a discovery deadline of September 1, 2023,

and required the parties to file dispositive motions on the Legal Malpractice Defendants’ Fourth

and Eleventh Affirmative Defenses, to wit:

Fourth affirmative defense: This action is brough in violation of the rule of
law that prohibits the assignment of legal malpractice claims. The Complaint
is brought either pursuant to an express or implicit consent agreement and
assignment of policyholder rights from the insured motorist to the injured
claimant, and therefore the Plaintiff has no standing in receivership or
otherwise to assert legal malpractice causes of action by the only injured and
real party in interest in the claimant.

Eleventh affirmative defense: Plaintiff does not have standing to bring this
action for the reasons set out in Defendants’ Motion to Dismiss filed March
19, 2020.

? Order Reserving Ruling on Exceptions and Cross-Exceptions to Magistrate’s Report, Directing Resolution
of Threshold Issues and Staying Unrelated Discovery. Dkt. 249.
Dkt. 183, 86, 93.
14. As explained below, the undisputed material facts demonstrate the Fourth and

Eleventh Affirmative Defenses fail as a matter of law and that Plaintiff, as Receiver for JLL, has

standing to prosecute JLL’s legal malpractice claims against Boltrek and Henderson Franklin.

Undisputed Material Facts

15. It is undisputed that an attorney-client relationship existed between the Legal

Malpractice Defendants and JLL at all material times hereto:

a. Boltrek and Henderson Franklin were retained to represent and defend JLL against the

claims brought by the Schmitzes, and it is undisputed they formed an attorney-client

relationship with JLL. Dkt. 170 and 180, 4 20, 22.

On October 28, 2016, Boltrek entered an appearance as counsel of record for Li,

Garrido, and JLL in the Underlying Lawsuit by filing an Answer, Affirmative Defenses

and Demand for Jury Trial on behalf
of the Underlying Defendants. Exhibit 5.

Boltrek and Henderson Franklin continued to represent JLL through the conclusion of

the underlying litigation.? See Ex. 1.

Thus, it should be undisputed that JLL would have standing to sue Boltrek and Henderson Franklin

for their alleged malpractice, which Plaintiff contends caused JLL to suffer the entry of the $3.75

million judgment. Rather, the issue before the Court is whether McHale, the court-appointed

Receiver for JLL, has standing to bring the malpractice claims.

16. The Order Appointing Receiver provides, inter alia, that McHale “shall have the

authority to take exclusive possession, control and custody of the Property,” which is as “all real

3 Although not relevant to the current motion, Plaintiff would be remiss if he did not point out the record
evidence suggests Boltrek continued representing JLL for a lengthy period after the Final Judgment was
entered.
property, personal property, things in action, goods, chattels and any other assets...of Defendant

JLL LOGISTIC INC., a Florida Corporation.” Ex. 4, § 1-2. McHale “shall remain in exclusive

control of the Property until further order of [the] Court.” Ex. 4, § 10. The Order also permits

McHale to:

“hire, employ, retain and terminate professionals which the Receiver deems

necessary to assist in the discharge of his duties”; (Ex. 4, 4 5)

“execute and deliver in his own name as Receiver, documents necessary and

appropriate to consummate transactions, enter into contracts and pay lawful

debts of the Defendant JLL LOGISTIC INC”; (Ex. 4, ] 7)

“prosecute all lawsuits as may be reasonably necessary in the Receiver’s

judgment.” (Ex. 4, § 8)

The only limitation on McHale’s authority is to “hold and retain all money that may come into the

Receiver’s possession by virtue of his appointment until further order” of the trial court. Ex. 4, J

17. On January 23, 2020, Plaintiff McHale as Receiver for JLL Logistic, Inc. filed this

lawsuit against the Legal Malpractice Defendants. While the Schmitzes’ are judgment creditors of

JLL, they are not parties to this action.

18. It is undisputed that the Schmitzes have no control over McHale, JLL, or this

litigation.

a. As Janice Schmitz succinctly testified, “I have no control over this lawsuit.” Exhibit

6, J. Schmitz Dep., 12:4.

Similarly, when asked whether he has “exercised any control or given any direction in

relation to this lawsuit,” William Schmitz testified, point-blank, “No.” Exhibit 7, W.
Schmitz Dep., 10:4-8.4

Consistent with the Schmitzes, when asked “who is in charge or in control of this

litigation,” McHale testified, “Me. And if somebody wanted to come to me and make

a proposed settlement, I would consider it. But it would be my call. And, again, if I

were to make that call, I would take it to the judge and suggest that this is what I think

would be good for all the parties.” Exhibit 8, McHale Dep., 72:13-20, Jun. 1, 2023;

see also 29:21-30:2, 72:6-9, 72:21-25.

19. In fact, the Schmitzes both testified they had no knowledge of the present litigation.

When asked whether she was “unaware that a malpractice suit had been brought against

[Boltrek and Henderson Franklin],” Janice Schmitz testified, “I’m unaware.” Ex. 6, J.

Schmitz Dep., 29:5-8.

Mr. Schmitz similarly testified, “No” when asked whether he was “aware that Mr.

McHale as Receiver for JLL brought the legal malpractice claims against [Boltrek and

Henderson Franklin].” Ex. 7, W. Schmitz Dep., 19:25-20:3.5

20. It is also undisputed JLL did not assign any claim to the Schmitzes.

Janice Schmitz testified, aside from the stipulated final judgment, she had no

agreements with JLL Logistic. Ex. 6, J. Schmitz Dep., 6:17-7:7. When asked if she

had an “agreement with Mr. McHale to bring a legal malpractice claim on behalf of

JLL Logistic...,” she answered “no.” Ex. 6, J. Schmitz Dep., 9:11-15.

Ina similar vein, William Schmitz confirmed he had no agreement with Mr. Li outside

of the stipulated final judgment. Ex. 7, W. Schmitz Dep., 6:12-15. When asked whether

4 See also Ex. 6, J. Schmitz Dep., 11:4-10, 11:11-13, 12:2-4; Ex. 7, W. Schmitz Dep., 10:1-8.
> See also Ex. 6, J. Schmitz Dep., 10:17-11:3, 29:5-8, 29:17-21; Ex. 7, W. Schmitz Dep., 9:22-25, 19:16-
20, 19:25-20:3.
he or his wife “have any agreement with JLL for the prosecution ofa legal malpractice

claim arising out of JLL’s representation in the claim that [William Schmitz] brought

against JLL stemming from [the] accident in November of 2015,” Mr. Schmitz

answered, “no.” Ex. 7, W. Schmitz Dep., 10:17-23.°

21. Indeed, the only “assignment” of any claims involved in this litigation was

McHale’s acquisition of the choses in action belonging to JLL by virtue of section 56.10, Florida

Statutes, and the court order appointing McHale as Receiver. See Ex. 4. And while McHale, as

Receiver for JLL, has control over this litigation as Plaintiff, he would ultimately need court

approval before disbursing any assets recovered in this litigation. See Ex. 4, § 9; Ex. 8, McHale

Dep., 72:13-20.

Memorandum of Law

I Under the applicable standard, the Legal Malpractice Defendants will not be able to meet
their burden of proving their affirmative defenses.

Effective May 1, 2021, the Florida Supreme Court adopted the federal standard for

summary judgment by amending Florida Rule of Civil Procedure 1.510. See In re Amendments to

Florida Rule of Civil Procedure 1.510, 317 So. 3d 72 (Fla. 2021). Under the amended Rule, courts

“shall grant summary judgment if the movant shows that there is no genuine dispute as to any

material fact and the movant is entitled to judgment as a matter of law.” Fla. R. Civ. P. 1.510(a)

(2021). “The federal standard closely mirrors the standard for directed verdict, in which the focus

of the analysis is ‘whether the evidence presents a sufficient disagreement to require submission

to a jury. o» Halum v. ZF Passive Safe Sys. US, Inc., 360 So. 3d 391, 393 (Fla. 4th DCA 2023)

(citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986)).

© See also Ex. 6, J. Schmitz Dep., 6:17-7:1, 7:3-7, 9:7-15, 10:3-6; Ex. 7, W. Schmitz Dep., 6:12-15, 7:11-
18, 8:14-22, 9:7-21, 10:17-23.
The movant initially maintains the burden of demonstrating the absence of a genuine

dispute of material fact, and once the movant meets their initial burden, the burden shifts to the

non-movant to present evidence showing that there exists a genuine issue of material fact. See

Gervas v. Gazul Producciones SL Unipersonal, 358 So. 3d 1257, 1259-60 (Fla. 3d DCA 2023).

Notably, a “fact is ‘material’ if ‘it may affect the outcome of the case under the applicable

substantive law.’” Halum 360 So. 3d at 393 (citing Star Cas. Ins. Co. v. Gables Ins. Recovery, Inc.,

346 So. 3d 1244, 1246 (Fla. 3d DCA 2022)).

Moreover, under the newly adopted federal standard, the nonmoving party must present

more than just a scintilla of evidence in support of its position. See Mane FL Corp. v. Beckman,

355 So. 3d 418, 425 (Fla. 4th DCA 2023) (“The ‘mere existence of a scintilla of evidence’ in

support of the non-movant’s position is insufficient to defeat summary judgment.”) (citations

omitted). Instead, the nonmoving party is tasked with the burden of setting for the enough evidence

showing a jury could reasonably find in his or her favor. In other words, “[m]Jere conclusions and

unsupported factual allegations are legally insufficient to defeat a summary judgment motion.”

Ellis v. England, 432 F.3d 1321, 1326 (11th Cir. 2005) (citations omitted).

Accordingly, a “party opposing summary judgment ‘must do more than simply show that

there is some metaphysical doubt as to the material facts.” In re Amendments, 309 So. 3d at 193

(citing Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)). Instead,

a party opposing summary judgment must “go beyond the pleadings and ‘identify affirmative

evidence' that creates a genuine dispute of material fact.” Carter _v. Blue House Painting &

Remodeling, LLC, 367 So. 3d 618, 620 (Fla. 2d DCA 2023) (quoting Brevard County v. Water:

Mark Dev. Enters. Li C, 350 So. 3d 395, 398 (Fla. 5th DCA 2022)). “If the evidence is merely

colorable, or is not significantly probative, summary judgment may be granted.” In_re
Am endments, 309 So. 3d at 193 (citing Anderson, 477 U.S. at 249-50). “A court ‘view[s] the

evidence in the non-movant's favor, but only to the extent that it would be reasonable for a jury to
o
resolve the factual issues that way. Perez v. Citizens Prop. Ins. Corp., 345 So. 3d 893, 895 (Fla.

4th DCA 2022) (citing Jones v. UPS Ground Freight, 683 F.3d 1283, 1296 n.38 (11th Cir. 2012)).

“Ultimately, ‘[w]here the record taken as a whole could not lead a rational trier of fact to find for

the non-moving party,’ the trial court should grant summary judgment.” Id. (citing Matsushita,

375 US. at 587).

Il. Florida law permits McHale, as Receiver for JLL, to bring these legal malpractice claims.

McHale was appointed as Receiver for JLL pursuant to section 56.10, Florida Statutes,

which states:

If an execution cannot be satisfied in whole or in part for lack of property of
the corporate judgment debtor [JLL Logistic Inc.] subject to levy and sale, on
motion of the judgment creditor [the Schmitzes] the circuit court in chancery
within whose circuit such corporate judgment debtor is or has been doing
business, or in which any of its effects are found, may sequestrate the
property, things in action, goods and chattels of the corporate judgment
debtor for the purpose of enforcing the judgment, and may appoint a receiver
for the corporate judgment debtor. A receiver so appointed is subject to the
tules prescribed by law for receivers of the property of other judgment
debtors. His or her power shall extend throughout the state.’

In accordance with section 56.10, the trial court in the underlying litigation authorized McHale, as

receiver, to “prosecute all lawsuits as may be reasonably necessary in [McHale’s] judgment.” Ex.

4, § 8. (Emphasis added).

This authorization is consistent with Florida law. As the Second District Court of Appeals

has observed, “[i]t is axiomatic that [a court-appointed] receiver obtain[s] the rights of action and

remedies that were possessed by the person or corporation in receivership.” Freeman v. Dean

7 This statute has not been amended since 2016. Laws 2016, c. 2016-33, § 7, eff. July 1, 2016.

10
Witter Reynolds, Inc., 865 So. 2d 543, 550 (Fla. 2d DCA 2003);8 see also Hamilton v. Flowers,

183 So. 811, 817 (Fla. 1938) (“The general rule is that a receiver takes the rights, causes and

remedies which were in the corporation, individual or estate whose receiver he is, or which were

available to those whose interests he was appointed to represent.”) (citations omitted). As a result,

receivers “can bring actions previously owned by the party in receivership for the benefit of the

creditors.” Id.

There is no authority suggesting that receivers are prohibited from bringing legal

malpractice claims. On the other hand, the Second DCA has held bankruptcy trustees have

standing to bring legal malpractice claims against the judgment debtor’s former attorneys. See

Herendeen v. Mandelbaum, 232 So. 3d 487, 490 (Fla. 2d DCA 2017) (finding public policy did

not bar a trustee’s legal malpractice action against the bankruptcy estate’s former attorney and

holding the trustee had standing to bring the malpractice claim). Likewise, a successor personal

representative (PR) has standing to bring a legal malpractice action against the predecessor

personal representative’s former counsel. See Bookman v. Davidson, 136 So. 3d 1276, 1279-80

(Fla. 1st DCA 2014) (finding the powers and rights of the predecessor PR flowed to the successor

PR, and that “the personal representative is required by law to pursue assets and claims of the

estate, with value, including those assets which are in the hands of a former personal representative

or her or his agents”).

Those situations are analogous to the instant case. Just like a receiver, a bankruptcy trustee

stands in the shoes of the judgment debtor, and a successor PR stands in the shoes of the original

PR. In both cases, the person standing in the shoes of the original client has standing to bring the

* Note, the Freeman court ultimately decided the receiver lacked standing to pursue the claim at-issue
because the entire corporation in receivership was engaged in the Ponzi scheme—not just one officer or
employee—and as such, the proper parties to bring the claims would be the creditors of the corporation in
receivership.

11
legal malpractice claim.

In sum, Florida law does not prohibit a receiver from bringing legal malpractice claims

against the entity in receivership’s former attorneys. Indeed, the case law indicates the opposite is

true; a receiver, like McHale, is permitted to prosecute all lawsuits reasonably necessary in the

receiver’s judgment. See Freeman, 865 So. 2d at 550; Hamilton, 183 So. at 343; Ex. 4, § 8.

Til. The Legal Malpractice Defendants’ Fourth Affirmative Defense fails as a matter of
law.

The Legal Malpractice Defendants allege via their Fourth Affirmative Defense:

This action is brough in violation of the rule of law that prohibits the
assignment of legal malpractice claims. The Complaint is brought either
pursuant to an express or implicit consent agreement and assignment of
policyholder rights from the insured motorist to the injured claimant, and
therefore the Plaintiff has no standing in receivership or otherwise to assert
legal malpractice causes of action by the only injured and real party in interest
in the claimant.

Dkt. 183, § 86. This defense fails as a matter of law because the undisputed material facts show

JLL did not expressly or implicitly assign any claims to the Schmitzes.

It is undisputed that JLL did not “expressly” assign legal malpractice claims to the

Schmitzes. Ex. 6, J. Schmitz Dep., 6:17-7:1, 7:3-7, 9:7-15, 10:3-6; Ex. 7, W. Schmitz Dep., 6:12-

15, 7:11-18, 8:14-22, 9:7-21, 10:17-23. Ex. 8, McHale Dep., 29:21-30:2, 72:6-9. Therefore, that

portion of the Legal Malpractice Defendants’ Fourth Affirmative Defense fails as a matter of law.

Although it is unclear what the Legal Malpractice Defendants mean by an “implicit

assignment,” one assumes they are referring to a situation where the client (JLL) relinquished all

control over the handling of the malpractice claim, including the ability to accept or reject any

settlement offers, to the judgment creditors (the Schmitzes), as was the case in Weiss v.

Leatherberry, 863 So. 2d 368, 372 (Fla. Ist DCA 2003). But again, the undisputed material facts

reflect (1) there is no agreement between JLL or McHale and the Schmitzes of any kind, other than

12
the consent judgment itself; and (2) the Schmitzes have not exercised any control over the current

litigation, nor do they have any authority to do so in the future. See Ex. 6, 7 and 8. Again, McHale,

in his capacity as Receiver and the named plaintiff in this lawsuit, exercises “exclusive control”

over the handling of this litigation, including the decision to accept or reject any settlement offers.

See Ex. 4, § 1, 5-10. The only limitation on his control is the requirement that he obtain court

approval before disbursing any settlement proceeds, as is customary for all receiverships. Ex. 4,

4 7-9; Ex. 8, 69:15-70:2; see also Fugazy Travel Bureau, Inc. v. State by Dickinson, 188 So. 2d

842 (Fla. 4th DCA 1966) (“The right ofa receiver to settle claims and compromise actions with

the approval and sanction of the court is well recognized...”) (citations omitted).

Thus, taking the undisputed material facts in the light most favorable to the Legal

Malpractice Defendants, there is no record evidence supporting an express or implicit assignment

of legal malpractice claims to the Schmitzes. As such, the Legal Malpractice Defendants’ Fourth

Affirmative Defense fails as a matter of law. See Bedford v. Doe, 880 F.3d 993, 996 (8th Cir.

2018) (“[I]f the nonmoving party must prove X to prevail [at trial], the moving party at summary

judgment can either produce evidence that X is not so or point out that the nonmoving party lacks

the evidence to prove X.”) (cited with approval In re Amendments to Florida Rule of Civil

Procedure 1.510, 317 So. 3d 72, 75 (Fla. 2021)).

Iv. The Legal Malpractice Defendants’ Eleventh Affirmative Defense also fails as a
matter of law.

In their Eleventh Affirmative Defense, the Legal Malpractice Defendants allege:

Plaintiff does not have standing to bring this action for the reasons set out in
Defendants’ Motion to Dismiss filed March 19, 2020

Dkt. 183, § 93. As a preliminary matter, this is not a proper affirmative defense because it does not

plead “ultimate facts sufficient to provide notice of the proof the defendant intends to rely upon to

13
defeat the plaintiff's claim.” See S. Florida Coastal Elec., Inc. v. Treasures on Bay II Condo Ass'n,

89 So. 3d 264, 267 (Fla. 3d DCA 2012). Plaintiff should not be forced to divine what the Legal

Malpractice Defendants are alleging constitutes a “confession and avoidance” within its 14-page

motion to dismiss.

In any event, Plaintiff hypothesizes the Legal Malpractice Defendants are alleging the

following (in addition to the “assignment” allegation pled in the Fourth Affirmative Defense,

discussed above):

1 “the Receivership is being used in both an unnecessary and inappropriate way—to pursue

an action against third parties for the benefit of the Schmitzs (sic),” and the Schmitzes are

the real parties in interest in this litigation and lack the privity needed to bring these

malpractice claims. Dkt. 16, § 20-21.

it would contravene public policy (gutting the attorney-client privilege and creating a new

marketplace for legal malpractice claims) to allow McHale to bring the legal malpractice

claims against the Defendants. Dkt. 16, § 24-26.

As is explained below, neither argument has factual or legal merit.

A. McHale has standing to bring the legal malpractice claims, regardless of whether any
recovery may inure to the benefit of the judgment creditors, the Schmitzes.

As a preliminary matter, McHale agrees the Schmitzes lack the privity necessary to bring

legal malpractice claims against Henderson Franklin and Boltrek. But that is irrelevant to this case

— the Schmitzes are not the plaintiffs.

Nevertheless, the Legal Malpractice Defendants apparently contend that a legal

malpractice case can never be brought by a receiver appointed pursuant to section 56.10, because

any money recovered may ultimately inure to the benefit of the company in receivership’s

judgment creditors (here, the Schmitzes). This contention is without any legal support.

14
Again, section 56.10 expressly permits judgment creditors, such as the Schmitzes, to move

for the appointment of a receiver, who then acquires all “things in action”? (including legal

malpractice claims) available to the company in receivership. See also Freeman, 865 So. 2d at

550; Hamilton, 183 So. at 343; Ex. 4, § 8. The legal malpractice claim is an asset of the company

in receivership, just like an accounts receivable. The receiver is then authorized to take any legal

action, including the hiring of lawyers and prosecution of lawsuits, to collect or liquidate the asset

for the benefit of the company in receivership and, ultimately, its creditors. There is nothing

nefarious or improper about that, despite the Legal Malpractice Defendants’ incessant complaining

about it.

B. Allowing a receiver to prosecute legal malpractice claims does not violate public
policy. Even if it did, the Legislature — not the Court — is the appropriate forum to
change it.

Because there is no legal authority supporting the Legal Malpractice Defendants’ position

that receivers appointed under section 56.10 lack standing to pursue legal malpractice claims, they

have asked this Court to declare that “public policy” prohibits it. But the Legal Malpractice

Defendants’ gripe is with section 56.10 itself, which allows a judgment creditor to have a receiver

appointed for the judgment debtor and, upon appointment, transfers to that receiver all choses in

action available to the company in receivership.

Of course, this Court would be powerless to ignore or contravene section 56.10 even if

“public policy” would be better served by carving out an exception for lawyers who commit

malpractice. As the First DCA explained 39 years ago:

° CHOSE, Black's Law Dictionary (11th ed. 2019):
chose in action. (17c) 1. A proprietary right in personam, such as a debt owed by another
person, a share in a joint-stock company, or a claim for damages in tort. 2. The right to
bring an action to recover a debt, money, or thing. 3. Personal property that one person
owns but another person possesses, the owner being able to regain possession through a
lawsuit. — Also termed thing in action; right in action.

15
[W]e must recall that it is not our prerogative to explore the wisdom or advisability
of the enactment. . . Courts are never permitted to strike down an act of the
Legislature because it fails to square with their individual social or economic
theories or what they deem to be sound public policy. Further, it must ever be kept
in mind that the legislature possesses broad discretion in determining what
measures are necessary for the public's protection, and we may not substitute our
judgment for that of the legislature insofar as the wisdom or policy of the act is
concerned.

B arnes v. B.K. Credit Serv., Inc., 461 So. 2d 217, 219 (Fla. 1st DCA 1984) (cleaned up); see also

Local No. 234 of United Ass'n of Journeymen & Apprentices of Plumbing & Pipefitting Indus. of

U.S. & Canada v. Henley & Beckwith, Inc., 66 So. 2d 818, 821 (Fla. 1953) (“[C]ourts have no

right to ignore or set aside a public policy established by the legislature or the people. Indeed, there

rests upon the courts the affirmative duty of refusing to sustain that which by the valid statutes of

the jurisdiction, or by the constitution, has been declared repugnant to public policy.”).

But even if this Court had the power to prohibit McHale from bringing the current legal

malpractice claims because of public policy concerns — and it does not — it should refrain from

doing so. The Legal Malpractice Defendants are effectively asking the Court to create a bright-

line rule that would immunize lawyers from valid legal malpractice claims whenever a receiver is

appointed under section 56.10, even if the lawyer’s malpractice is what caused the company to go

out of business and necessitated the appointment of a receiver in the first place.

It should be axiomatic that Defendants’ suggested rule would violate public policy. If there

is any question about that, consider Herendeen, the Second DCA case which held the bankruptcy

trustee had standing to pursue legal malpractice claims belonging to the discharged debtor. The

court observed, “[w]e are chary to conclude that Florida public policy insulates the lawyers from

the consequences of the misconduct alleged by [the trustee].” 232 So. 3d at 491. The same public

policy concerns apply here — a lawyer should not be immune from the torts they committed just

because the corporate client is now defunct and assetless.

16
Vv. Conclusion.

For the foregoing reasons, Plaintiff, as Receiver for of JLL, has standing to prosecute the

legal malpractice claims brought against Henderson Franklin and Boltrek.

WHEREFORE, Plaintiff, GERARD A. MCHALE, JR., as Receiver for JUL LOGISTIC,

INC., respectfully requests this Honorable Court enter partial summary judgment in favor of

Plaintiff
as to the issue of his standing to prosecute the legal malpractice claims against Defendants,

WILLIAM BOLTREK, III and HENDERSON, FRANKLIN, STARNES & HOLT P.A., and

declare that the Fourth and Eleventh Affirmative Defenses fail as a matter of law.

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on November 10, 2023, the foregoing was served via electronic
mail through the e-filing portal to John W. Weihmuller and James M. Shaw, Jr.,
({jweihmuller@butler.legal; khill@butler.legal; mmenaull@butler.legal; jshaw@butler.legal),
Butler, Weihmuller, Katz, Craig LLP, 400 N. Ashley Drive, Suite 2300, Tampa, FL 33602, and

Kenneth R. Drake and James Paul Brandt Roen, (kdrake@cmlawfirm.com;

vgarcia@cmlawfirm.com; broen@cmlawfirm.com) Cruser, Mitchell, Novitz, Sanchez, Gaston &

Zimet, LLP, 806 Douglas Road, 12th Floor, Coral Gables, FL 33134.

/s/ Brent Steinberg
BRENT STEINBERG
Florida Bar No.: 0085453
ANGELA E. RODANTE
Florida Bar No.: 092509
NATALIE I. SHOEMAKER
Florida Bar No.: 1025707
SWOPE, RODANTE P.A.
1234 East 5" Avenue
Tampa, Florida 33605
P: (813) 273-0017
F: (813) 223-3678
Appeals@swopelaw.com
Team3eservice@swopelaw.com
service@swopelaw.com
Attorneys for Plaintiff

17
PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT ON
DEFENDANTS BOLTREK AND HENDERS: FRANKLIN’S
FOURTH AND ELEVENTH AFFIRMATIVE DEFENSES

EXHIBIT 1
INTHEOROUI COURT OF THE TWENTIETH JUDICOALORCUL
IN AND FOR CHARLOTTECOUNTY, FLORIDA.
CVILACTION

WILLIAM H. SCHMITZ and JANICE K.
SCHMITZ, as husband and wife,

Plaintiffs,
CASE NO.: 2016-CA-001754
Vv,

ALEXMAR PIMIENTA GARRIDO; JLL
LOGISTIC, INC.; and ROBERTO LI,

Defendants.

MEMORANDUM
_OF MEDIATION AGREEMENT

On the 23 day of January 2018, a mediation was conducted. Participants on behalf of

the Plaintiffs were Michael Noone, Esquire; Elizete Velado, Esquire; William Schmitz; and

Janice Schmitz. Participants on behalf of the Defendant, JLL Logistic Inc., were William

Boltrek, III], Esquire; Roberto Li, as corporate representative; and Deborah Brown, as

representative of York Risk Services Group (by phone). The following agreement was reached

and no participants objected to the following:

Defendant, JLL LOGISTIC, INC., hereby consents to a Consent Judgment in the

amount of $3,750,000, attached hereto.

The remaining Defendants, ALEXMAR PIMIENTA GARRIDO and ROBERTO

LI, have been released and are not parties to this agreement.

KB-000543
3 No funds are being paid in consideration of th dgm

nit ALL éy

Plaintiff, William a Roberto Li, as corporate representative of
Defendant, MLLogistic, Inc.

tiff, Janice Schmitz

IIL, Esquire
Defendant(s) Counsel

ete Vi , Esquire
Plaintiffs} Counsel

KB-000544
IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT
IN AND FOR CHARLOTTE COUNTY, FLORIDA
CIVIL ACTION

WILLIAM H. SCHMITZ and JANICE K. SCHMITZ,
as Husband and Wife,

Plaintiffs,

Vv. CASE NO.: 16001754CA

ALEXMAR PIMIENTA GARRIDO,
JLL LOGISTIC INC and ROBERTO LI,

Defendants.
/

STIPULATION ON AGREEMENT OF CONSENT JUDGMENT

IT IS HEREBY STIPULATED by the Plaintiffs, WILLIAM H. SCHMITZ and

JANICE K. SCHMITZ, and Defendant, JLL LOGISTICS INC, to the Final Judgment

attached hereto as Exhibit A.

DATED on this_22 day of January 2018.

pont, ALK i \\
WILLI MH. SC OBERTO Ve JLL LOGISTICS INC
Gh
O WICE K. SOHMITZ

KB-000545
IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT
IN AND FOR CHARLOTTE COUNTY, FLORIDA
CIVIL ACTION

WILLIAM H. SCHMITZ and JANICE K. SCHMITZ,
as Husband and Wife,

Plaintiffs,

Vv. CASE NO.: 16001754CA

ALEXMAR PIMIENTA GARRIDO,
JLL LOGISTIC INC and ROBERTO LI,

Defendants.
/

FINAL JUDGMENT

Pursuant to the Stipulation of the Parties in this action:

IT IS ADJUDGED that Plaintiffs, WILLIAM H. SCHMITZ, whose address is 3451

SE County Rd 760, Arcadia, Florida 34266, and JANICE K. SCHMITZ, whose address

is 3451 SE County Rd 760, Arcadia, Florida 34266, recover from Defendant, JLL

LOGISTICS INC, whose address is 2019 Warrington Way, Tampa, Florida 33619, the

sum of Three Million, Seven Hundred and Fifty Thousand Dollars ($3,750,000.00),

inclusive of taxable costs, with all parties to bear their own attorney's fees. The

judgment shall bear interest at a rate of 4.75% a year, for which let execution issue.

DONE and ORDERED in Chambers, Punta Gorda, Lee County, Florida on this

day of January, 2018.

LISA S. PORTER
Circuit Court Judge

cc: William Boltrek, Esquire
Michael M. Noone, Esquire

KB-000546
PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT ON
DEFENDANTS BOLTREK AND HENDERS: FRANKLIN’S
FOURTH AND ELEVENTH AFFIRMATIVE DEFENSES

EXHIBIT 2
Filing # 96776934 E-Filed 10/04/2019 02:51:13 PM

IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT
IN AND FOR CHARLOTTE COUNTY, FLORIDA
CIVIL ACTION

WILLIAM H. SCHMITZ and JANICE K. SCHMITZ,
as Husband and Wife,

Plaintiffs,

Vv CASE NO.: 16001754CA

ALEXMAR PIMIENTA GARRIDO,
JLL LOGISTIC INC and ROBERTO LI,

Defendants.
|

MOTION TO APPOINT RECEIVER

COMES NOW the Plaintiffs, WILLIAM H. SCHMITZ and JANICE K. SCHMITZ,

by and through the undersigned counsel and moves this Court, pursuant to Fla. Stat.

§56.10, to appoint Gerald McHale to serve as Receiver for the defendant and judgment

debtor, JLL LOGISTIC INC., and granting Receiver all the powers and duties identified

within the proposed Order Appointing Receiver attached hereto as Exhibit A, and in

support thereof state as follows:
1
Plaintiffs, WILLIAM H. SCHMITZ and JANICE K. SCHMITZ, initiated the

instant action on September 26, 2016 for injuries and consortium damages sustained in

a motor vehicle collision. Plaintiff, WILLIAM H. SCHMITZ brought a count for

negligence against Defendant ALEXMAR PIMIENTA GARRIDO, the driver of tractor

trailer involved in the collision with Plaintiff's vehicle. Plaintiff brought a count for direct

or vicarious negligence against ROBERTO LI, the director of JLL LOGISTIC, INC. and a

registered owner of the truck. Plaintiff also brought a count for direct or vicarious
negligence against JLL LOGISTIC, IINC., registered owner of the truck and Mr.

Garrido’s employer. Plaintiff, JANICE K. SCHMITZ, brought claims for loss of

consortium against all three defendants.

2 Plaintiffs resolved their claims against Defendants, ALEXMAR PIMIENTA

GARRIDO and ROBERTO LI and their claims were dismissed with prejudice on May

23, 2017.

3 On January 29, 2018, this Court entered a stipulated Final Judgment in

the amount of $3,750,000.00 against JLL LOGISTIC INC. A copy of the Final Judgment

is attached hereto as Exhibit B.

4 In an effort to execute on the above-described Final Judgment, Plaintiffs

scheduled JLL LOGISTIC INC.’s Director, Mr. Roberto Li, for a deposition in aid of

execution on Friday February 8, 2019. A copy of the amended notice of deposition and

subpoena directed at Roberto Li are attached as a composite Exhibit C.

5 A process server with Accurate Serve of Fort Myers made nine attempts

to serve the subpoena on Roberto Li between December 24, 2018 and February 5,

2019. A copy of the Verified Return of Non-Service is attached as Exhibit D.

6 The deposition in aid of execution was then rescheduled for April 4, 2019.

A copy of the notice and subpoena for the April 4, 2019 deposition are attached as a

composite Exhibit E.

7 A~-process~-server -with~Accurate~ Serve~ of -Fort~Myers made ~~ four

unsuccessful attempts to serve the new subpoena on Mr. Li between March 5, 2019

and March 15, 2019. A copy of the Verified Return of Non-service is attached hereto as

Exhibit F.
8. A review of the corporate status of JLL LOGISTIC IINC on the Florida

Department of State, Division of Corporations website (sunbiz.org) shows that JLL

LOGISTIC INC is currently inactive and was administratively dissolved on September

23, 2016. A print-out of the Corporate detail for JLL LOGISTIC INC is attached as

Exhibit G.

9 Plaintiffs and their process server have been unable to locate or

personally serve the director of JLL LOGISTIC INC and JLL LOGISTIC INC appears to

now be a defunct corporation. Because of this, Plaintiffs are unable to obtain

information needed to execute on their final judgment.

10. Under these circumstances, this Court may appoint a receiver for the

corporate judgment debtor in the instant action, JLL LOGISTIC IN

Case Info

Judge

GENTILE, GEOFFREY H Track Judge’s New Case

Case No.

(Subscribe to View)

Document Filed Date

December 23, 2036

Case Filing Date

June 22, 105

County

Parties

BOLTREK, WILLIAM III Defendant
DRAKE, KENNETH RUSSELL Attorneys for Defendants
DRAKE, KENNETH RUSSELL Attorney for the Defendant
GENTILE, GEOFFREY H Judge
HENDERSON FRANKLIN STARNES & HOLT P A Defendant
JACK, LEWIS N JR Attorneys for Plaintiffs
KNIGHTBROOK INSURANCE COMPANY Defendant
MCHALE AS RECEIVER FOR JLL LOGISTIC INC, GERALD A JR Plaintiff
PEARCE, REBA ABRAHAM Attorney
RODANTE, ANGELA E Attorneys for Plaintiffs
RODANTE, ANGELA E Attorney for the Plaintiff
ROEN, BRANDT Attorneys for Defendants
SHAW, JAMES M JR Attorneys for Defendants
SHOEMAKER, NATALIE ISABELLA Attorneys for Plaintiffs
SHOEMAKER, NATALIE ISABELLA Attorney for the Plaintiff
SWOPE, DALE M Attorneys for Plaintiffs
SWOPE, DALE M Attorney for the Plaintiff
WEIHMULLER, JOHN W Attorneys for Defendants
Michael Shaw Attorneys for Defendants
Michael Noone Attorney
Brent Steinberg Attorneys for Plaintiffs
Brandon Cathey Attorneys for Plaintiffs
Scot Goldberg Attorney
Elizete Velado Attorneys for Plaintiffs
Teresa Vazquez Attorneys for Defendants
Deborah Brown Attorney
Dale Merrill Attorney
James Shuta Attorney
William Smith Attorney
Michael Krzywicki Attorney
Daniel Greene Attorneys for Plaintiffs
Logan Goldberg Attorney
Steven Ramunni Attorney
James Regan Attorney
Jacob Schuster Attorney
Michelle Ku Attorneys for Plaintiffs
Jacob Munch Attorney

For full print and download access, please subscribe at https://www.trellis.law/.

No Value: MCHALE AS RECEIVER FOR JLL LOGISTIC INC, GERALD A JR vs. KNIGHTBROOK INSURANCE COMPANY

Preview

Related Topics

Case Info

Parties