SUPREME COURT OF FLORIDA

Case No.: SC-10-397

PADC MARKETING, LLC, COLLINS AVENUE, ASSOCIATES, LLC,

AND R. DONAHUE PEEBLES,
Petitioners,
v.
DORA PUIG, THE PUIG GROUP, and DORA PUIG, P.A.,
Respondents.

RESPONDENTS BRIEF ON JURISDICTION

ON DISCRETIONARY REVIEW FROM A DECISION OF THE THIRD

DISTRICT COURT OF APPEAL
Case No.: 3D09-2094

Michael J. Schlesinger
Michael L. Cotzen
SCHLESINGER & COTZEN, P.L.
799 Brickell Plaza, Suite 700
Miami, Florida 33131
Telephone: (305) 373-8993
Facsimile: (305) 373-8098

Geoffrey B. Marks
BILLBROUGH & MARKS, P.A.
100 Almeria Avenue, Suite 320
Coral Gables, Florida 33134
Telephone: 305-442-2701
Facsimile: 305-442-2801

Counsel for Respondents

TABLE OF CONTENTS
Page
TABLE OF CONTENTS .ii
TABLE OF AUTHORITIES ..iii
INTRODUCTION ....1
STATEMENT OF THE CASE AND FACTS .2
SUMMARY OF THE ARGUMENT ...4
ARGUMENT 5
I. Conflict Jurisdiction Does Not Exist Because The Opinion
Resolved a Different Question of Law Than Those Decided in
McCray and Because the Basis of Conflict was not Raised Below.
..................................................................5
II. Conflict Jurisdiction Does Not Exist Because The Opinion Does
Not Conflict with McCray v. Adams.
..6
A.
B.
C.
D.
E.

Facts in McCray v. Adams.7

There was a Discharged Order in McCray....7
The Instant Case is Not a Reformation Case.........7
This is Not a Case Seeking Contribution...8
PADC is not an Indispensable Party..9

III. Conclusion.......9
CERTIFICATE OF SERVICE ...12
CERTIFICATE OF COMPLIANCE ..12

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TABLE OF AUTHORITIES
CASES

Pages

A.H. Robins Co., Inc. v. Piccinin

788 F.2d 994 (4th Cir. 1986)...3,4,9
Credit Alliance Corp. v. Williams
851 F.2d 119 (4th Cir. 1988).....9
Dober v. Worrell
401 So. 2d 1322, (Fla. 1981)6
Ingersoll-Rand Fin. Corp. v. Miller Mining Co.
817 F.2d 1424, 1427 (9th Cir. 1987).3
In re Sunbeam Securities Litigation
261 B.R. 534 (S.D. Fla. 2001)..3
Malloy v. Gunster, Yoakley, Valdes-Fauli & Stewart, P.A.
850 So. 2d 578 (Fla. 2d DCA 2003).8
McCray v. Adams
529 So. 2d 1131 (Fla. 1st DCA 1988)1,4,5,6,7,8
Metropolitan Dade County v. Chase Federal Housing Corp.
737 So. 2d 494 (Fla. 1999)...6
Puig v. PADC Marketing, LLC
26 So. 3d 45 (Fla. 3d DCA 2009)...1,2,3
Reaves v. State
485 So. 2d 829, 830 (Fla. 1986)...5
Rojas v. First Bank National Assn
613 F.Supp. 968, 971 (E.D.N.Y. 1985)9
W.W. Gay Mechanical Contractor, Inc. v. Wharfside Two, Ltd.
545 So. 2d 1348 (Fla. 1989).3
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STATUTES
11 U.S.C. 362(a)(1).3
Art. V, Sec. 3(b)(3) Fla. Constitution1
RULES
Fla. R. App. P. 9.030(a) (2) (A) (iv)..1

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INTRODUCTION
Petitioners seek discretionary review under Article V, Section 3(b)(3) of the
Florida Constitution. See also Fla. R. App. P. 9.030(a)(2)(A)(iv). Article V,
Section 3(b)(3) provides that the Florida Supreme Court may review a district
court of appeal decision only if it expressly and directly conflicts with a decision
of another district court of appeal or of the supreme court on the same question of
law.
Petitioners seek discretionary review of the Third District Court of Appeals
decision denying plaintiffs motion to compel the deposition of the deposition of
R. Donahue Peebles and granting an indefinite stay of this entire action against all
defendants pending the completion of the bankruptcy proceeding against only one
defendant, PADC Marketing, LLC. Puig v. PADC Marketing, LLC, 26 So. 3d 45,
46 (Fla. 3d DCA 2009). The Third District held that no unsual circumstances
existed to warrant an indefinite stay of the entire action while one of several
defendants was pursuing relief in bankruptcy court.
According to Petitioners, this holding of the Third District expressly and
directly conflicts with Mc Cray v. Adams, 529 So. 2d 1131 (Fla. 1st DCA 1988), a
decision Petitioners never cited in any brief or post-opinion motion before the
Third District.

According to Petitioners, McCray holds that a trial court has

discretion to stay an action where one of several defendants are in bankruptcy. We

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could not agree more that a trial court has such discretion. We could not disagree
more that the holding of the Third District and the holding of the First District are
in express and direct conflict.
STATEMENT OF THE CASE AND FACTS
We take our facts directly from the four corners of the Third Districts
opinion.
[Respondent] Dora Puig is a licensed real estate sales broker and is the
Director of the [Plaintiffs] Puig Group, Inc. and Dora Puig, P.A.
[Defendant] Collins Avenue Associates, LLC is the original developer
and owner of a high end condominium complex called the Residences
at the Bath Club, located in Miami Beach, Florida. [Petitioner]
Peebles is the president, owner, managing member, and sole member
of Collins Avenue. Peebles exercised complete control over all the
aspects relating to the development and management of the Bath
Club. [Petitioner] PADC is the sales and marketing arm of the Collins
Avenue. Peebles is the owner and sole managing member of PADC.
It is undisputed that Peebles, PADC, and Collins Avenue are
separate and distinct entities.
[On December 18, 2000,] Collins Avenue contractually retained Puig,
first as a marketing consultant and after the Bath Clubs public
opening, as the Director of Marketing and Sales. In early 2002,
Peebles requested that Puig consent to an assignment of the contract
to a new company, PADC. [Respondents] have alleged that, after
prolonged negotiations, Puig agreed to the assignment of her contract
to PADC, but with the caveat that she did not consent to any
limitation on her right to collect compensation from Collins Avenue.
They further have alleged that [Petitioners] eventually breached their
contracts, leading to the filing of their complaint on May 5, 2006.
They argue in their petition for certiorari that the claims against
Collins Avenue and Peebles are independent claims and can be tried
without inclusion of PADC. On April 6, 2009, [Respondents] noticed
this case for trial and the court issued, on April 14, 2009, a Uniform
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Order Setting Cause for Jury Trial for the two week trial period
commencing August 3, 2009.
During the litigation, [Respondents] had been attempting to depose
Peebles. They noticed his deposition for May 7-8, 2009 and noticed
the deposition of the corporate representative of Collins Avenue for
May 19, 2009. On April 27, 2009, ten days before Peebles' scheduled
deposition and over a month after it was noticed, PADC filed for
bankruptcy in the Southern District of Florida. That same day,
[Petitioners] counsel informed [Respondents] counsel that Peebles
would not be appearing for his May 7 deposition.
Puig v. PADC Marketing, LLC, 26 So. 3d at 46 (emphasis added).
On December 23, 2009, the Third District Court of Appeal granted Puigs
Petition for Writ of Certiorari and quashed the Order staying the action. In its
Opinion (the Opinion), the Third District noted that an automatic stay applies
only to the debtor 1 and held that a stay is appropriate only in unusual
circumstances. The Third District read the A.H. Robins Co., Inc. v. Piccinin, 788
F.2d 994 (4th Cir. 1986), decision as authorizing courts to extend the automatic
stay to non-bankrupt co-defendants only in unusual circumstances. Id. at 999.
1

Both federal and state courts in Florida have followed the general rule that the
United States Bankruptcy Code generally stays proceedings against the debtor
alone, in this case, PADC, which is the only party to this matter that has sought
protection from the bankruptcy court. See W.W. Gay Mechanical Contractor, Inc.
v. Wharfside Two, Ltd., 545 So. 2d 1348 (Fla. 1989); see also In re Sunbeam
Securities Litigation, 261 B.R. 534, 536 (S.D. Fla. 2001); 11 U.S.C. 362(a)(1). In
W.W. Gay, the Florida Supreme Court stated that, Generally, the protections of
the automatic stay do not apply to a codefendant not in bankruptcy. W.W. Gay,
545 So. 2d at 1350; see also Ingersoll-Rand Fin. Corp. v. Miller Mining Co., 817
F.2d 1424, 1427 (9th Cir. 1987).
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Puig, 26 So. 3d at 47. Such an unusual situation, as explained in A.H. Robins

would be when there is such identity between the debtor and the third-party
defendant that the debtor may be said to be the real party defendant and that a
judgment against the third-party defendant will in effect be a judgment or finding
against the debtor. Id. Because the trial court did not find such an unusual
situation existed, nor do we conclude that such a finding would be warranted,
we grant the petition for writ of certiorari and quash the order staying the
entire action. Id. (emphasis added). On this holding, the Third District
determined that the stay will cause material injury to [Respondents] in that their
action against Collins Avenue and Peebles was stayed pending the resolution of
PADCs bankruptcy proceedings by the United States Bankruptcy Court, a court
without jurisdiction over [Puigs] claims against Peebles and Collins Avenue. Id.
at 46.
SUMMARY OF THE ARGUMENT
This Court should not accept conflict jurisdiction over this case. Stays of the
kind analyzed here are discretionary, and this case presents nothing that deviates
from the routine stay analysis framework. The instant case does not conflict with
McCray, particularly where this case resolved a different question of law than
McCray and the basis of conflict was not raised below prior to the filing of the
petition with this Court.

In addition, the facts and legal issues presented in

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McCray were different than those of this case.

ARGUMENT
I.
Conflict Jurisdiction Does Not Exist Because The Opinion
Resolved a Different Question of Law Than Those Decided in McCray and
Because the Basis of Conflict was not Raised Below.
There is no express and direct conflict and this Court should not exercise its
discretionary jurisdiction over this case. Article V, Section 3(b)(3) permits this
Court to review a district court decision when it expressly and directly conflicts
with another decision of this Court or another district court of appeal. Petitioners
seek this Courts jurisdiction, claiming that the rules of law in the Opinion conflict
with the First District decision in McCray. 2
Fatal to Petitioners claim of jurisdiction is that the purported conflict raised
by Petitioners does not appear within the four corners of the Opinion. See Reaves
v. State, 485 So. 2d 829, 830 (Fla. 1986). The only facts relevant to determining
whether this Court has jurisdiction to review the Opinion are those facts contained
within the four corners of the decisions allegedly in conflict. Id. Therefore, this
Court should disregard any arguments to issues outside of the four corners of the
Opinion, and specifically Petitioners argument that PADC is an indispensable
party to this litigation. Contrary to the Petitioners assertion, the lower court never
Despite seeking rehearing and/or clarification of the Opinion in the Third District,
Petitioners did not seek certification from the Third District that the Opinion
conflicts with another decision.
2

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held that PADC is a party that the court believes should be present before it issues
a ruling resolving the issues raised. See Brief at page 3. For this reason, along
with others raised below, this Court does not have conflict jurisdiction to review
the Opinion.
Moreover, this Court cannot consider newly raised arguments which were
not raised in the trial court or district court. See Metropolitan Dade County v.
Chase Federal Housing Corp., 737 So. 2d 494 (Fla. 1999); Dober v. Worrell, 401
So. 2d 1322, 1323-24 (Fla. 1981). Here, neither the Third District, nor Petitioners
in their Answer Brief or in their post-opinion motion ever cite McCray, for any
purpose or holding. The first time McCray appears is in the jurisdictional brief
before this Court. If McCray is truly in express and direct conflict with the Third
Districts decision, it would have appeared in some argument, some analysis, or
something presented by Petitioners before this round of briefing.
II.
Conflict Jurisdiction Does Not Exist Because The Opinion Does Not
Conflict with McCray v. Adams
According to Petitioners, the Third Districts opinion will eviscerate all
conventional discretion of a trial court to stay actions. See Brief at page 1.
Putting aside this over the top hyperbole, the Third Districts Opinion does nothing
more than give guidance to the trial court in how it should exercise its discretion
when faced with a request to stay a case.

And a trial courts exercise of

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jurisdiction over stays just does not meet the express and direct conflict standard.
A.

Facts in McCray v. Adams

In McCray, McCray filed an amended complaint against several parties,

alleging that a Satisfaction of Mortgage bearing his forged signature had been
recorded. He sued Nicholas Skolsky, Helen Skolsky, Ronald Palumbo, Marilyn
Palumbo, and American National Bank. Prior to filing the lawsuit, Nicholas
Skolsky filed for bankruptcy and one of the debts discharged was money owed to
McCray under the promissory note in question.
The defendants sought dismissal since the bankruptcy courts automatic stay
prevented the trial court from allowing Mr. Skolsky to be joined, and because Mr.
Skolsky was an indispensable party. The trial court agreed and the appellate court
affirmed. There are, however, important differences between McCray and the
instant Opinion.
B.

There was a Discharge Order in McCray

First, there was a Discharge of Debtor Order entered in McCray. There, the
bankruptcy court already discharged the same debt that McCray was suing for. No
such debt has been discharged in PADCs bankruptcy.
C.

The Instant Case is Not a Reformation Case

The McCray court held that McCray must establish that his signature was
fraudulently placed on the satisfaction document before he could foreclose on his
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mortgage, and Skolsky was obviously an indispensable party for that action.
McCray sought to reform those documents, and the appellate court noted that in a
suit to reform a written instrument, all persons interested in the subject matter of
the litigation, whether their interest is legal or equitable, should be made parties so
that the court may settle all rights at once thereby preventing multiplicity of suits.
Here, Plaintiffs have not brought a claim for reformation. Again, these cases are
not alike. As such, there is no conflict between McCray and the instant case.3
D.

This is Not a Case Seeking Contribution

In the McCray case, the First District stated that the amended complaint
clearly indicates [Plaintiffs] intention to establish Skolskys personal liability as
being a participant in the offenses of the fraud alleged. The First District also
noted that the defendants in McCray had the right to seek contribution from others.
Here, the facts are remarkably different. It is undisputed that Peebles,
PADC, and Collins Avenue are separate and distinct entities. Puig, 26 So. 3d at
46. Plaintiffs do not require PADCs inclusion in the case to establish liability and
damages. Importantly, Collins Avenue guaranteed PADCs obligation to Puig.

Petitioners cite to Malloy v. Gunster, Yoakley, Valdes-Fauli & Stewart, P.A., 850
So. 2d 578 (Fla. 2d DCA 2003). In Malloy, the Second District held that the trial
court should decide the issues relating to the non-debtor without regard to the
pending bankruptcy of the debtor. Id. The court held the lower courts stay of the
case resulted in a miscarriage of justice, as, like in this case, were it not for the
debtors bankruptcy, the case against all defendants would have already been tried.
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Id. at 47.4 Therefore, any corporate liability to Puig can be paid by Collins
Avenue, irrespective of PADCs bankruptcy.
E.

PADC is not an Indispensable Party

Throughout their Brief, Petitioners assert that PADC is a necessary or

indispensable party to the trial courts jurisdiction. It is not. Aside from the fact
that the Third Districts Opinion stated nothing about this meritless argument, the
issue here is the scope and extent of a stay order entered by the trial court. Here,
the case was improperly indefinitely stayed by the trial court. The Third District so
held and reversed. Since the case can proceed despite PADCs bankruptcy, there
was, in the Opinion by the Third District, a valid basis for granting the
extraordinary relief affected by certiorari.
III.

Conclusion
The Opinion was not a blanket prohibition against staying proceedings

pending the resolution of bankruptcy proceedings as Petitioners try to convince this

Court. Instead, in this specific scenario, when the non-debtor entity guaranteed the
4

Courts have held that guarantees such as the one in the instant case do not
support the invocation by a guarantor of the statutory protection of 362, or permit
a court to stay an action. See A.H. Robins, 788 F.2d at 1000; Credit Alliance Corp.
v. Williams, 851 F.2d 119 (4th Cir. 1988). The very purpose of a guaranty is to
assure the [creditor] that in the event the [debtor] defaults, the [creditor] will have
someone to look to for reimbursement. Rojas v. First Bank National Assn, 613
F.Supp. 968, 971 (E.D.N.Y. 1985).
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debtors obligations to the Plaintiff, the Third District properly held that such a
stay was not proper and the trial court abused its discretion by staying the case
indefinitely. Indeed, the Third District held, like other courts, that unusual
circumstances must exist to justify a stay. This ruling is not unique in light of the
clear precedent that the bankruptcy stay only protects the debtor, not other entities.
Here, Plaintiffs can be made whole without PADCs continued involvement in this
lawsuit.

This case clearly does not conflict with McCray.

For the reasons

discussed above, this Court should decline to accept conflict jurisdiction.

SCHLESINGER & COTZEN, P.L.

Counsel for Respondents
799 Brickell Plaza, Suite 700
Miami, FL 33131
Phone: (305) 373-8993
Facsimile: (305) 373-8098
Email: mjs@scflalaw.com

By: __________________________
Michael J. Schlesinger, Esq.
Fla. Bar No. 141852
Michael L. Cotzen, Esq.
Fla. Bar No. 166472
----and----

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BILLBROUGH & MARKS, P.A.

100 Almeria Avenue, Suite 320
Coral Gables, FL 33134
Phone: (305) 442-2701
Facsimile: (305) 442-2801
By: __________________________
Geoffrey B. Marks, Esq.
Fla. Bar No. 714860

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CERTIFICATE OF SERVICE
WE HEREBY CERTIFY that a true and correct copy of the foregoing was
served by U.S. Mail this 2nd day of June 2010 to Michael J. Higer, Esq., Higer,
Lichter, & Givner, LLP, 18305 Biscayne Blvd., Aventura, Florida 33160; and
Ramon A. Abadin, Esq., Abadin & Cook, PA, 9155 S. Dadeland Blvd., Suite
1208, Miami, FL 33156.

By: ___________________________
Michael J. Schlesinger, Esq.
Michael L. Cotzen, Esq.

CERTIFICATE OF COMPLIANCE
I hereby certify that this brief was prepared in Times New Roman, 14-point
font, in compliance with Rule 9.210(a)(2) of the Florida Rules of Appellate
Procedure.
By:____________________________
Michael J. Schlesinger, Esq.
Michael L. Cotzen, Esq.

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