October 19, 2026
In Florida construction disputes, walking away with a net judgment does not automatically make a party the “prevailing party” entitled to attorney’s fees. A net judgment is an important factor in that determination, but it is not the only one, and it is not always the deciding one. Moritz v. Hoyt Enterprises, Inc., 604 So. 2d 807 (Fla. 1992).
Construction payment and performance disputes often strain relationships among owners, general contractors, and subcontractors, especially when material costs, financing pressures, and delay claims are in play. Parties on both sides often assume that recovering any net judgment guarantees fee recovery. That assumption can distort settlement decisions and prolong litigation that might otherwise have been resolved. Understanding how Florida courts actually decide who “prevailed” gives owners, contractors, and subcontractors a more accurate read on their fee exposure.
The Significant Issues Test
In Moritz, the Florida Supreme Court held that, in a breach of contract action, the “significant issues” test determines the prevailing party for purposes of awarding attorney’s fees. Moritz, 604 So.2d 807 (Fla. 1992). Under this test, “the party prevailing on the significant issues in the litigation is the party that should be considered the prevailing party for attorney’s fees.” Id. at 810 (emphasis added).
What Factors Do Courts Weigh?
To decide which party prevailed on the significant issues, the trial court has the flexibility to “consider the equities” of the case. Trytek v. Gale Industries, Inc., 3 So.3d 1194 (Fla. 2009). Those equities can include:
- the issues actually litigated and which party prevailed on them,
- the amount claimed versus the amount recovered,
- the existence of setoffs,
- the result of any counterclaims, and
- the amounts either party offered to resolve the dispute before litigation, assuming those negotiations were not otherwise confidential by agreement or statute.
Id. at 1203. After weighing these factors, the trial court may determine that one party prevailed, or it may decide that neither party prevailed. Id.; Prosperi, 626 So. 2d 1360, 1361. The net judgment is one piece of that analysis, not the whole of it.
Moritz: A Net Recovery Without a Fee Award
Moritz illustrates the point. The Moritzes contracted with Hoyt Enterprises (Hoyt) to purchase a lot and build a single-family home, which was in the initial stages of construction when the contract was signed. Moritz at 808. The Moritzes paid Hoyt deposits totaling $57,877.45. Id. After complaining about the quality of certain items, they contracted to buy a different house and repudiated the Hoyt contract through a letter from their attorney. Id.
The Moritzes were found to have breached their contract with Hoyt, yet they still recovered most of the funds they had paid on deposit. Moritz at 809. Even so, Hoyt was not required to pay the Moritzes’ attorney’s fees despite the fact that the Moritzes recovered $45,525.90. Id. The Moritzes obtained that amount by partially prevailing on their defense to Hoyt’s counterclaim, but they did not prevail on either their breach of contract or enforcement of lien claim. Id. The Florida Supreme Court approved the finding that “Hoyt Enterprises prevailed on the significant issues in the case because it did not breach the contract and, consequently, should not be required to pay attorney’s fees to the parties who did not prevail on their complaint and only partially prevailed on their defense to the counterclaim.” Id. at 810.
Trytek: When Neither Side May Be the Prevailing Party
Although Trytek arose under Florida’s construction lien statute rather than a contractual fee provision, the Florida Supreme Court applied the same significant issues test and confirmed that a court may also conclude that neither party prevailed for purposes of attorney’s fees. Trytek v. Gale Industries, Inc., 3 So.3d 1194 (Fla. 2009). In Trytek, Gale Industries, Inc. (Gale), an insulation contractor, sued homeowner Frank Trytek to foreclose a construction lien after Trytek withheld payment because Gale’s installers had damaged the home’s electrical wiring. Id. at 1196. Trytek counterclaimed for the cost to repair that damage. Id. Because the parties stipulated to the validity and amount of the lien, the only issue tried was the value of Trytek’s counterclaim. The trial court entered a net judgment of $1,525 in Gale’s favor but determined that Trytek was the prevailing party because he won the only issue actually litigated. Id. As a result, the court awarded Trytek $55,982 in attorney’s fees and $4,016.67 in costs, and Gale appealed. Id. The 5th District Court of Appeal reversed, reasoning that a contractor who obtains any judgment on its lien is ordinarily the prevailing party, and certified a question of great public importance. Id. at 1198.
The Florida Supreme Court quashed the 5th District’s decision. It agreed that Gale was not the prevailing party, held that a net judgment is a factor but not a determinative one, and confirmed that trial courts have discretion to find that neither party prevailed on the significant issues. The court remanded for the trial court to reconsider fees, explaining that it was “concerned that fees may have driven the litigation and prevented the parties from resolving the case.” Id. at 1203. Under a rigid net judgment rule, the court noted Gale would have received a fee award of approximately $41,882 even though it lost the only issue litigated and recovered just $1,525 on a recorded lien of $12,725. A rule like that can reward a party for refusing to settle and trying the case for the fees rather than the merits.
Port-A-Weld: The Test Works for Claimants, Too
While the significant issues test favored the defendant in Moritz, it applies equally when a plaintiff seeks attorney’s fees. See Port-A-Weld, Inc. v. Padula & Wadsworth Const., Inc., 984 So. 2d 564, 566 (Fla. 4th DCA 2008). In Port-A-Weld, the subcontractor, Port-A-Weld, Inc. (Port-A-Weld), sued the general contractor, Padula & Wadsworth Construction, Inc. (Padula), seeking $33,936.74 for the unpaid balance of its subcontract on a public construction project. Id. at 566. Padula counterclaimed for delay damages, out-of-pocket expenses, and other back charges it attributed to Port-A-Weld. Id. Applying the significant issues test to the case as a whole, the 4th District Court of Appeal held that Port-A-Weld was “clearly the prevailing party” because it was entitled to virtually its entire contract price, while Padula recovered less than 20% of the offsets it claimed. Id. at 570.
The court also refused to enforce a subcontract provision stating that a party recovering less than 75% of its claim could not be considered the prevailing party, holding that the significant issues test cannot be modified by contract. Id. Owners, contractors, and subcontractors drafting or negotiating fee provisions should keep that holding in mind.
Practical Considerations for Owners, Contractors, and Subcontractors
Parties evaluating fee exposure in a payment or breach of contract dispute should keep in mind that:
- a net judgment is a significant factor, but it does not guarantee a fee award;
- courts look at which party prevailed on the significant issues, weighing the claims and counterclaims, setoffs, the amounts claimed versus recovered, and non-confidential settlement offers made before litigation;
- a trial court has discretion to find that neither party prevailed, leaving each side to bear its own fees; and
- contract language that redefines “prevailing party” through a minimum recovery threshold may not be enforced.
Looking Ahead
Before assuming that a net judgment will secure fee recovery, or that falling short on part of a claim forecloses it, parties to construction payment and performance disputes should evaluate their fee exposure with counsel early and revisit it as settlement opportunities arise.
Questions?
Contact GrayRobinson Attorney Danny Amirata or a member of the Construction Team.