Appeals from the United States District Court for the
Southern District of Florida D.C. Docket No.
0:15-cv-60474-JIC D.C. Docket No. 0:15-cv-60474-JIC
Before
WILLIAM PRYOR, NEWSOM, and BRANCH, Circuit Judges.
NEWSOM, CIRCUIT JUDGE
This
case concerns a contract dispute between Q Club-the entity
that operates the condominium-hotel at the Hilton Fort
Lauderdale Beach Resort-and a class of condo owners over the
meaning of the "Declaration" that governs the
parties' relationship. We're focused here on the
Declaration's cost-sharing arrangement for the
maintenance of certain amenities that aren't tied to any
particular condo unit-expenses that the Declaration aptly
calls "Shared Costs."
Litigation
commenced soon after Q Club announced that it would change
the methodology that it uses to calculate these Shared Costs.
The new methodology, Q Club explained, would apply not only
on a going-forward basis but also retroactively. That meant,
in effect, that the owners would be re-billed for assessments
that they had paid (or as Q Club sees it, underpaid) in years
past.
The
owners' complaint alleged that Q Club's new
methodology breached the Declaration as applied both
retroactively and prospectively. The district court agreed
with the first contention, but a jury disagreed with the
second. The parties now appeal the respective judgments
against them. The owners separately argue that the district
court erred by denying their request for a new trial based on
what they say constitutes newly discovered evidence that
could have swayed the jury on the prospective-application
question. After careful review, we affirm across the board.
I
A
The
Hilton Fort Lauderdale Beach Resort includes a number of
"Commercial Units" and "Residential
Units," as well as one "Hotel Unit." The
Residential Units aren't your typical condominiums; as
the complaint explains, "no guest, including any
Residential Unit owner, may occupy a Residential Unit for
more than 120 days in any calendar year." This
restriction helps to "ensure the transient nature of the
use of the Residential Units"; the owners serve dual
roles as both "investor[s] and part-time resident[s] who
[can] take advantage of the revenue-generating benefits of
putting their unit into the hospitality inventory to be
rented out as a luxurious hotel suite when not in use."
The
"Declaration of Q Club Resort and Residences
Condominium" outlines a cost-sharing arrangement for the
maintenance of what it calls "Shared Components."
These Shared Components-which Q Club is responsible for
maintaining-include, among other things, "the main hotel
lobby; the pools and pool deck; the fitness center . . . and
all parking areas and/or parking garages located within the
Condominium property." In short, they comprise many of
what one might typically call the "common areas."
The Declaration grants Residential and Commercial Unit Owners
an easement to travel freely through and enjoy the Shared
Components in exchange for periodic payments of "Shared
Costs." Shared Costs are those "incurred by [Q
Club] in (or reasonably allocated to) the repair,
replacement, improvement, maintenance, management, operation,
ad valorem tax obligations and insurance of the Shared
Components." The Declaration requires Unit Owners to pay
a portion of these Shared Costs. In particular, Unit Owners
must-
pay to [Q Club] annual charges for the operation and
insurance of, and for payment of 40.4967% of the Shared Costs
. . ., the establishment of reasonable reserves for the
replacement of the Shared Components and the furnishings and
finishings thereof, capital improvement charges, special
charges and all other charges hereinafter referred to or
lawfully imposed by [Q Club] in connection with the repair,
replacement, improvement, maintenance, management, operation,
and insurance of the Shared Components, all such charges to
be fixed, established and collected from time to time as
herein provided.
Shared
Costs, the Declaration further explains, "shall be paid
for in part through charges (either general or special)
imposed against the Residential Units and the Commercial
Units in accordance with the [Declaration's] terms."
This
arrangement continued without incident from the
Declaration's inception in 2007 until 2012, when Q Club
determined that it had inadvertently omitted certain expenses
that should have been included as Shared Costs. As Q Club
describes it, that meant that the Unit Owners hadn't been
paying the required 40.4967% of the Shared Costs.
Accordingly, it notified the Unit Owners that it would begin
to use a different methodology going forward and, further,
that it intended to recoup the forgone charges over a 10-year
period by applying the new methodology retroactively.
B
A class
of Unit Owners-whom we'll call "Dear," after
the lead plaintiff- filed this action in Florida state court,
and Q Club successfully removed to federal court pursuant to
the Class Action Fairness Act, 28 U.S.C. § 1453.
Dear's complaint asserted (1) that the Declaration
doesn't permit Q Club to "back charge" for
costs incurred but not assessed and (2) that Q Club's new
methodology for determining Shared Costs includes items that
it shouldn't. For simplicity's sake, we'll call
the first issue the "back-charging" question and
the second the "Shared Costs" question.
Because
one of the appeals before us turns on whether the district
court properly submitted a particular issue-namely, the
Shared Costs question-to the jury, a bit of procedural
history is necessary. The parties initially agreed in their
Joint Pretrial Stipulation that there were no "issues of
law" for the district court to decide. On the
back-charging question, Dear submitted as an "issue[] of
fact which remain[ed] to be litigated at Trial" the
question whether Q Club, "in violation of the
Declaration," retroactively assessed Unit Owners for
Shared Costs going back to 2007. Dear further included the
Shared Costs question among the "issues of fact"
for the jury's consideration-in particular, whether
"Q Club breached the Declaration . . . by charging and
collecting expenses . . . as Shared Costs . . . that are not
authorized by the Declaration." For its part, Q Club
didn't say anything about the back-charging issue, but it
agreed with Dear that whether it had breached the Declaration
"by charging for items that were not Shared Costs"
was a question of fact for the jury.
The
parties' unanimity on the division of labor between judge
and jury was short-lived. When asked by the district court
(in a discussion about the appropriateness of considering
industry custom) whether "the declaration clearly
define[s] what a shared component is," Dear answered
"[a]bsolutely." In response, Q Club said that
"if this definition is as clear as [Dear] says,"
then it was "baffled as to why this is a jury
trial," and in light of Dear's statement Q Club
pivoted to argue that the Shared Costs question was "a
matter of law for [the court] to decide, not for the
jury." Dear, though, stuck to his guns. When pressed by
the district court whether he agreed with Q Club that the
Shared Costs issue was "for the Court [rather than] the
jury," Dear responded that "it is for the
jury." The district court acceded to Dear's view,
stating that the determination whether a breach of contract
had occurred was "a factual issue" "for the
jury determine." It did so over Q Club's objections
that it would be improper to "ask[] the jury to make a
legal determination of what [the Declaration] says" and
that the jury shouldn't "decide if something is a
shared component or not."
Thereafter,
Dear's insistence that the Shared Costs question should
go to the jury seemed to soften, as evidenced by several
instances in which he acknowledged that the issue-or at least
portions of it-might be purely legal. For example, when Q
Club moved under Federal Rule of Civil Procedure 50(a) for
judgment as a matter of law on both the back-charging issue
and the Shared Costs issue, it argued that whether the
Declaration authorized its changes was "a question of
law"-there was, it said, "nothing for the jury to
hear." Dear agreed-sort of. He responded that
"[t]here's no doubt that [the] two issues in this
case are issues of law" and, to that end, he said that
he was "expecting and urging the Court to instruct the
jury that there is no ambiguity [in the Declaration]."
In the same vein, Dear acknowledged that "[w]hether
something is a shared component is a matter this Court can
determine as a matter of law," and he even indicated
that he would be "asking the Court at the conclusion of
the case to declare that anything that was expended in the
inside of these private property residential
condominiums" was not "recoverable as shared
costs."[1] Conspicuously, though, Dear never filed
his own Rule 50(a) motion on the Shared Costs issue.
Although
the district court denied Q Club's Rule 50(a) motion as
to both issues, it later determined that the back-charging
issue (but not the Shared Costs issue) presented a legal
question that it could and should decide for itself. The
court thereafter held that the Declaration "clear[ly]
and unambiguous[ly]" forbids "retroactive charging
for costs incurred in prior years." Specifically, the
court concluded that §§ 12.3 and 12.4, on which Q
Club staked (and still stakes) its back-charging
position-much more on that below-provided no authority for
retroactive assessments. Accordingly, the court entered
judgment as a matter of law for Dear on the back-charging
issue.
The
case proceeded to trial on the Shared Costs issue. Notably
for present purposes, at the charge conference the parties
tangled over several key jury instructions. Two disputes are
relevant here. First, Dear wanted the district court to tell
the jury that the court had decided the back-charging issue
in his favor. After some back and forth-Q Club complained
that Dear's proposed instruction would be prejudicial-the
court settled on the instruction that the matter "ha[d]
been adjudicated" and that the jury "should not
consider this issue" in deciding the Shared Costs
question. Second, Dear asked the district court to instruct
the jury that, "as a matter of law," the
Declaration's definition of Shared Components controlled
and that the jury was "required to use that
definition." (Notably, in so arguing, Dear admitted that
he "should have probably argued this in the Rule
50.") The court declined to give Dear's proposed
instruction; instead, it charged the jury that the parties
"dispute[d] the meaning of certain terms,"
including "shared costs" and "shared
components" and that in reaching its decision, it should
"consider the plain and ordinary meaning of the language
used in the contract" and "the circumstances
surrounding the making of the contract."
Thereafter,
the jury returned a unanimous verdict in Q Club's favor,
finding that its new methodology for calculating Shared Costs
didn't breach the Declaration. Dear filed a post-judgment
motion for a new trial. (He didn't file a renewed motion
for judgment as a matter of law under Rule 50(b) because he
hadn't initially moved-as the Rule requires-for judgment
as a matter of law under Rule 50(a).[2]) Dear contended (1) that the
district court had erred by allowing the jury to decide the
Shared Costs issue, (2) that the court should have given his
requested jury instructions, and (3) that he had new evidence
that contradicted Q Club's position regarding Shared
Costs and proved that Q Club had been
"double-billing" for certain items.
On the
first issue, the district court held that, even if it was an
error to send the Shared Costs issue to the jury, it was an
error that Dear had invited. The court emphasized that Dear
had demanded a jury, hadn't moved for summary judgment,
and had insisted at the pre-trial calendar call that the
Shared Costs issue presented a factual question. The court
further concluded that its jury instructions weren't
misleading or erroneous and that, in any event, Dear
couldn't show that the trial would have turned out any
differently had his proposed charge been given. Finally, the
court held that the new evidence that Dear had proffered
didn't actually contradict Q Club's position on
Shared Costs.
These
appeals followed, with Q Club appealing the district
court's adverse determination of the back-charging issue,
and Dear appealing the jury's verdict on the Shared Costs
issue and the court's denial of its new-trial motion.
II
We'll
start with Q Club's ...