Payton & Associates, LLC

Miami Business Litigation Lawyers

2 S. Biscayne Blvd., Suite 2300
Miami, FL 33131

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Payton & Associates, LLC

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  • Rated By Super Lawyers Harry A. Payton Selected in 2014 Thomson Reuters
  • The Florida Bar Board Certified Business Litigation
  • The Florida Bar Board Certified Civil Trial

Miami Business & Commercial Law Blog

What is a breach of fiduciary duty in Florida?

A fiduciary duty is an obligation that arises when one has a legal duty to act in the best interests of another. For example, a business partner has a fiduciary duty to their other partners. When a party fails to uphold their obligations, it could be a breach of their fiduciary duty. In a corporate or other commercial setting, a breach of fiduciary can result in contentious business litigation.

Fiduciary relationships can exist in any number of situations. They can be created by contract, imparted by statute or implied as a matter of law by the actions of the parties in the relationship. Fiduciary duties are often financial relationships, but not always. Most common fiduciary duties occur when one party is placed in a position of extreme trust -- like a lawyer, an accountant, a corporate board member, a trustee, a conservator or the executor of an estate -- vis a vis another party.

Miami police officer accused of Ponzi scheme

It appears that even law enforcement is not above the easy money a Ponzi scheme can appear to offer. Recently, the FBI arrested a veteran Miami police officer as he was about board a plane to Costa Rica. The officer was allegedly running a Ponzi scheme during his off hours and has been charged with wire fraud.

The fraud claims against the accused involve an investment scheme. The defendant offered 20 percent returns to investors, which he claimed offered high-interest loans to real estate owners in Costa Rica. The Department of Justice says that, in classic Ponzi scheme style, the defendant was using phony paperwork, and new investments were simply used to pay returns to earlier investors and to enrich himself.

Commercial real estate in Florida: do not try this at home!

Commercial real estate is big business in South Florida -- maybe even the biggest. It is connected to all of the state's major industries from tourism and housing to banking, government and health care. If there is a business sector that requires property, commercial real estate, in some form or another, will come into play.

The trouble is, commercial real estate is whole different animal from residential real estate. Unfortunately, many unsuspecting investors and business folks who have had considerable experience -- and even success -- in residential real estate can find themselves in deep, hot water, when it comes to the commercial side. Commercial real estate involves different laws, permitting, licensing and even business relationships than does its residential counterpart.

Fraud continues to be rampant

In 2015, an article that appeared in the New York Post called South Florida "the organized fraud capital of America." Unfortunately, a current look at the region's legal landscape does little to dispel such a notion. From property and casualty insurance to parking and disability benefits, or construction and Ponzi schemes, fraud continues to plague the state.

The state's spiraling number of fraud claims is typified most recently by the demise of former United States Representative Corrine Brown, whose Congressional District once included Orlando. On January 29, Brown reported to the Coleman Federal Correctional Complex to begin a five-year sentence for misappropriating almost $800,000 that was to be used to aid disadvantaged students. The funds instead found their way into Brown's own bank accounts.

Liability for construction defects in Florida

Construction defects can be costly. Where they involve large commercial developments, the price tag for mitigating defects in construction can easily run into the millions of dollars. In the case of an undiscovered defect, if it results in personal injury or death, the financial and legal fallout can be disastrous. Whenever a defect of design or construction is present, the potential for construction litigation exists.

Liability for construction defects arises initially from contract law. The contracts between a developer and a contractor, or between a contractor and subcontractors, will govern who is responsible for creating -- and then mitigating -- a defect. The contracts will also help to determine who will cover the costs of mitigating the defects. Unfortunately, parties do not always agree on how a contract should be interpreted and disputes over liability may arise.

Suit demonstrates costliness of construction disputes

It seems, Miami and South Florida has been in an unending period of construction and development. These projects range from residential and commercial buildings to considerable overhauls of the regional infrastructure, like passenger rail corridors. However, with construction comes the potential for disputes and even construction litigation.

Major construction projects, such as the Brightline rail project, involve a tremendous number of coordinated phases and moving parts. The failure of a single element, such as an engineering, surveying or planning error, can derail an entire development. Or, they can result in mistakes that can drain millions of dollars from the project's budget.

Non-compete agreements can protect businesses

Business owners work hard to build their enterprises. Often, doing so involves grooming star employees, developing customer lists, proprietary products and methods, trade secrets and other recipes for success that owners do not want to leave the business. In Florida, non-compete agreements can help to protect a business's secrets and prevent them from falling into the hands of a competitor.

These days, employees cannot always be expected to spend their entire careers with a single company. They may leave to work for another company or even start their own business in the same industry. And, in doing so, they may be tempted to use the knowledge they gained from a former employer. This is where a non-compete agreement can be crucial.

Handling complex construction litigation takes experience

Construction is booming in Miami and across South Florida. It seems that new high-end residential and commercial projects are started every day, all with price tags running into the millions (or tens and hundreds of millions) of dollars. Big projects, however, have the potential to create complex construction disputes that can cost a developer, builder, or contractor a lot of time and money.

When you are involved in a major construction project, there are a lot of moving parts that make it, unfortunately, quite easy for disputes to arise. Even before the project gets off the ground, an engineer, surveyor or architect could make a mistake that results in costly delays or dangerous defects. In some cases, the mistakes may even rise to the level of professional malpractice.

South Florida fraud case revealed 8,400 defrauded investors

The Securities and Exchange Commission (SEC) has accused a former Boca Raton company and a California investor of running a $1.2 billion Ponzi scheme. The SEC claims the scheme defrauded 8,400 investors, many of whom were senior citizens. According to the complaint, after the fraud collapsed, investors were owed more than $960 million in outstanding principal. Over a quarter of the investors placed their retirement funds into the scheme.

The fraud claims are based on short-term loans to third-party owners of commercial properties. The scheme promised investors annual returns of 5 to 10 percent on loans that were given at rates of 11 to 15 percent. However, the complaint says that the vast majority of the companies to whom loans were given were owned by the California investor who helped perpetrate the fraud. He, in turned, pocketed $21 million of the investors' money.

Receivers are an asset when liability is found in Ponzi schemes

In the last year, there have been several Ponzi schemes unearthed in Florida. The chief architect of one such scheme that bilked Floridians out of $55 million is considering a plea deal, but whether victims of the fraud will be able to recover any of their losses depends on what assets the court and its appointed receiver(s) are able to find.

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