MY RUSALKA, INC. v. ROBERT T. GRGEK

Filing 20

DEFAULT FINAL JUDGMENT. ORDER granting 16 Motion for Default Judgment in the total sum of $225,459.70 and Closing Case. Motions Terminated: 16 Plaintiff's MOTION for Default Judgment Pursuant to Court Order filed by My Rusalka, Inc.. Signed by Judge Daniel T. K. Hurley on 5/29/15. (lr) NOTICE: If there are sealed documents in this case, they may be unsealed after 1 year or as directed by Court Order, unless they have been designated to be permanently sealed. See Local Rule 5.4 and Administrative Order 2014-69.

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO. 14-81440-CIV-HURLEY
MY RUSALKA, INC., a Delaware corporation,
Plaintiff,
vs.
ROBERT T. GRGEK
d/b/a AMERICAN CUSTOM CARE,
defendant.
______________________________________________/
DEFAULT FINAL JUDGMENT
THIS CAUSE is before the court upon the plaintiff=s motion for entry of default final
judgment filed March 13, 2015 [ECF No. 16] following entry of a Clerk’s Default against Defendant
Robert Grgek on January 30, 2015 [ECF 8]. Based on the Clerk’s Default, the Court now
adjudicates the defendant liable on the four claims set forth in the plaintiff’s complaint: (1) breach of
contract; (2) fraud in the inducement; (3) negligent misrepresentation, and (4) violation of Florida’s
Deceptive and Unfair Trade Practices Act (FDUTPA).
On May 14, 2015, a bench trial was conducted on the issue of damages. At trial, plaintiff
sought recovery of a full refund of all monies paid to defendant under the parties’ contract for the
preparation and painting of the yacht called “My Rusalka,” in addition to the full amount which
plaintiff paid to its own employees as well as successor contractors who were engaged to complete
the work begun by the defendant.

Having carefully considered the evidence presented at trial, together with argument of
counsel and applicable law, the court concludes that the plaintiff’s demand for a full refund from
defendants in addition to full replacement costs is inconsistent with the appropriate measure of
damages for breach of contract under Florida law or actual damages under the FDUTPA. The court
shall accordingly enter final default judgment on damages in favor of plaintiff, but in an amount
which conforms to the correct measure of damages for breach of contract in situations where, as
here, a contractor abandons a project before completion.
DISCUSSION
As an initial matter, the Court agrees that the plaintiff is entitled to a full refund of sums
previously paid to the defendant. This sum may be recovered under the FDUTPA, under which the
proper measure of damages is measured by:
the difference in the market value of the product or service in the condition in which
it was delivered and its market value in the condition in which it should have been
delivered according to the contract of the parties. A notable exception to the rule
may exist when the product is rendered valueless as a result of the defect -- then the
purchase price is the appropriate measure of actual damages.
H & J Paving v. Nextel, 849 So.2d 1099, 1101 (Fla. 3d DCA 2003) (quoting Rollins Inc. v. Heller,
454 So.2d 580, 585 (Fla. 3d DCA 1984)). In this case, the uncontested evidence at trial established
that defendant’s incomplete work was valueless to the plaintiff or to the successor contractors who
completed the preparation and painting of the My Rusalka. Therefore, the actual damages suffered
by plaintiff as a result of defendant=s violation of the FDUTPA consist of the full amount paid to the
defendant before he walked off the job, i.e. the sum of $88,798.06.

Next, the plaintiff is entitled to breach of contract damages. The appropriate measure of
breach of contract damages where a contractor abandons work is the difference between the contract
price and the reasonable cost to complete the project. Tri-County Plumbing Services, Inc. v. Brown,
921 So.2d 20, 22 (Fla. 3d DCA 2006), citing Marshall v. Karl F. Schultz, Inc., 438 So.2d 533 (Fla.
2d DCA 1983). In this case, the evidence showed that the original contract price for the paint
preparation and painting of the My Rusalka was $110,965.13; that the contract was executed by all
parties on July 11, 2014; and that the defendant undertook some preparation of the My Rusalka for
painting between July, 2014 and the end of September, 2014, when he abandoned the project and
pulled his crew off the vessel after a disagreement surfaced between the parties over the amount and
payment schedule for unanticipated vessel repairs which the parties had originally agreed, under the
express terms of the contract, to separately negotiate as the project progressed. Further, during the
time the defendant was on site, the plaintiff directed certain members of his own crew to assist the
plaintiff in the preparation and repairs of the My Rusalka because the defendant was understaffed to
perform the project.
The Court further finds, from the uncontested evidence presented at trial, that the plaintiff
incurred the following reasonable costs to complete the repair and painting of the My Rusalka as a
result of the defendant’s abandonment of the project and breach of contract:
(1) $22,243.40 for Rusalka paint preparation paid to “Johnson Filius & Crew,”
(2) $1,468.00 for purchase of an air compressor paid to “Air Compressor Works,”
(3) $28,382.16 for paint and supplies paid to “Merritt Supply,”
(4) $101,858.30 for Rusalka paint work paid to “Phan Yacht Refinishing Painter,”

(5) $36,782.00 for extended scaffold and float tent rental costs necessitated by defendant’s
project delay paid to “Southern Cross Boat Works.”
In addition, between the dates of August 15, 2014 and February 28, 2015, plaintiff incurred
the following reasonable labor costs paid to his own crew for the preparation/sanding of the My
Rusalka necessitated by the defendant’s understaffing of the project and failure to complete the
project:
(1) $29,166.62 paid to Luis Quinonez Mendoza;
(2) $15,415.44 paid to Joel Mendoza;
(3) $11,627.25 paid to William Eldridge.
This brings the total reasonable cost for completion of the project to $246,943.17. Minus the
original contract price of $ 110,965.13, the plaintiff is entitled to recover $135,978.04 as the correct
measure of damages on its breach of contract claim. Compare Tri-County Plumbing Services v
Brown, supra (plaintiff suffered no damage for breach of contract after recovering refund of amounts
paid to contractor who abandoned project where the work was completed by another contractor at a
reasonable price and under the amount quoted by the defaulting contractor).
Finally, the plaintiff seeks attorney’s fees pursuant to the Florida Deceptive and Unfair Trade
Practices Act (FDUPTA). Under the FDUPTA, courts have discretion to grant attorney’s fees and
costs to a prevailing party. Fla. Stat. § 501.2105(1); The Humane Society of Broward County, Inc. v.
The Florida Humane Society, 951 So.2d 966, 968 (Fla. 4th DCA 2007). Seven factors which are
relevant to the court’s exercise of discretion in this regard are: (1) the scope and history of the
litigation; (2) the ability of the opposing party to satisfy an award of fees; (3) whether an award of

fees against the opposing party would deter others from acting in similar circumstances; (4) the
merits of the respective positions, including the degree of the opposing party’s culpability or bad
faith; (5) whether the claim brought was not in subjective bad faith but frivolous, unreasonable
groundless; (6) whether the defense raised a defense made to frustrate or stall, and (7) whether the
claim brought was to resolve a significant legal question under FDUTPA law. Id. at 971-972, citing
Rosen v Rosen, 696 So.2d 697 (Fla. 1997).
Considering these factors here, in light of the brief history of the litigation and evidence
presented at the trial on damages, the Court finds that the factors militate against a discretionary
award of attorneys’ fees to the plaintiff. The individual defendant did not litigate the case, but
instead simply defaulted. At trial, the plaintiff’s principal testified that the defendant did not
properly perform under the contract because he underbid the project, and had insufficient financial
resources to complete it, and was unlikely to have the ability to pay any judgment entered in the case.
The defendant did not raise any defenses to the plaintiff’s FDUPTA claim, which did not involve any
significant legal questions under FDUTPA law. Under the entirety of circumstances, the Court finds
the relevant factors weight against the exercise of the court’s discretion to award attorneys’ fees in
favor of plaintiff as the prevailing party and accordingly disallows the plaintiff’s request for fees
under the FDUPTA in the amount of $ 12,657.00. However, the Court shall allow costs in the
amount of $683.60 (consisting of filing fees in the amount of $400 and process service fees of
$283.60) under Fed. R. Civ. P. 54(d), which provides that “’[e]xcept when express provision therefor
is made either in a statute of the United States or in these rules, costs other than attorneys’ fees shall
be allowed as of course to the prevailing party unless the court otherwise directs …”

DECRETAL PROVISIONS
Based on the foregoing, it is ORDERED AND ADJUDGED:
1. The plaintiff’s= motion for entry of default final judgment [ECF No. 16] is GRANTED.
2.

FINAL DEFAULT JUDGMENT is hereby entered in favor of plaintiff, MY

RUSALKA, INC., a Delaware corporation, and against the defendant, ROBERT T. GRGEK d/b/a
AMERICAN CUSTOM CARE, upon the complaint in this action.
3. The Plaintiff, MY RUSALKA, INC., shall recover of the defendant, ROBERT T.
GRGEK d/b/a AMERICAN CUSTOM CARE, the following sums:
a. $88,798.06 in actual damages under the FDUTPA;
b. $135,978.04 in compensatory damages for breach of contract;
c. $ 683.60 in costs.
Accordingly, plaintiff MY RSULAKA INC. shall recover from the defendant ROBERT T.
GRGEK d/b/a AMERICAN CUSTOM CARE the TOTAL SUM of $ 225,459.70, for which let
execution issue.
4. This judgment shall bear post-judgment interest at the statutory rate prescribed by 28
U.S.C. '1961.
5. The court retains jurisdiction to enforce this judgment.
6. The Clerk of Court is directed to terminate any pending motions as MOOT and to
CLOSE this file.

DONE AND ORDERED in Chambers at West Palm Beach, Florida this 29th day of May,
2015.

Daniel T. K. Hurley
United States District Judge

cc. All counsel
Robert Grgek, pro se