Facts
- Sellers granted Buyer an option to purchase real property under a written agreement later amended to require Buyer to set a closing date with at least seven days’ notice and to close no later than December 5, 1987.
- Buyer did not provide the required closing notice, and no closing occurred by the outside date.
- In February 1988, Sellers declared Buyer in default; Buyer responded by declaring Sellers in default.
- Sellers later contracted to sell the property to a third party, but that transaction failed after Buyer asserted an interest to the title company, which then refused to insure title against Buyer’s claim.
- Sellers sued Buyer in May 1988 for breach of contract, tortious interference, and slander of title, seeking damages and relief to clear title.
- In May 1989, Buyer filed counterclaims including specific performance of the real estate contract (and other claims for damages).
- Sellers sought summary judgment on the specific-performance counterclaim as untimely under a one-year limitations period for specific performance of contracts to convey real property.
Issues
- Whether a time-barred claim for specific performance of a real estate contract may be maintained when pleaded as a compulsory counterclaim.
- Whether the rule permitting certain time-barred counterclaims in recoupment for money damages extends to affirmative equitable relief of specific performance.
- Whether applying that extension would undermine the statutory limitations period and policies favoring marketable real property titles.
Decision
- The Florida Supreme Court answered the certified question in the negative.
- The court held that a claim for specific performance is barred by the one-year statute of limitations even if asserted as a compulsory counterclaim.
- The court quashed the district court decision that allowed the counterclaim to proceed and approved the trial court’s summary judgment for Sellers on the specific-performance counterclaim.
Legal Principles
- Actions for specific performance of a contract to convey real property must be brought within the one-year limitations period set by § 95.11(5)(a), Florida Statutes (1985).
- The doctrine allowing a time-barred counterclaim in recoupment applies to defensive offset of money damages arising from the same transaction and does not authorize affirmative relief.
- Specific performance is affirmative equitable relief, not a defensive recoupment, and cannot be used to circumvent an expired limitations period.
- “Equity follows the law”: equitable remedies must respect legislative time limits, particularly where stale claims would cloud title and impair marketability of land.
Conclusion
The court held that an untimely specific-performance claim for conveyance of real property cannot be revived by pleading it as a compulsory counterclaim; the one-year statutory bar controls, and recoupment principles applicable to defensive money offsets do not extend to affirmative equitable relief.