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Signing Without Reading – Not a Defense to Contract Enforcement in Florida

Posted on: January 18, 2013

The general rule in Florida is clear – No party to a written contract in this State can defend against it’s enforcement on the sole ground that he signed it without reading it.

This rule was acknowledged and applied in Merrill, Lynch, Pierce, Fenner & Smith, Inc. v. Benton, 467 So. 2d 311 (Fla. 5th DCA 1985) (“Benton”), where the Fifth District Court of Appeal stated that “[p]ersons not capable of reading English, as well as those who are, are free to elect to bind themselves to contract terms they sign without reading.   

The rule, however, is not absolute. 

In a recent Florida case, an exception to this rule was noted.  In Begualg Inv. Mgmt., Inc. v. Four Seasons Hotel Ltd., 10-22153-CIV, 2012 WL 5941971 (S.D. Fla. 2012), plaintiff, Begualg Investment Management, Inc. (“Begualg”) was established by a husband and wife who were residents of Mexico.  Begualg sued various defendants claiming fraud and breach of contract in connection with its purchase of several rental properties in Miami, Florida and its enrollment into rental agreements for those properties.  The condominium hotel units that were the subject of the transactions were located within the Four Seasons Hotel in Miami.  The plaintiff alleges that the various defendants, Millennium Partners, LLC, Four Seasons Hotels Limited, and Terremark Brickell II, Ltd. (“Four Seasons defendants”) acted in concert with defendant, Interinvestments Realty, Inc. (“Interinvestments”) who the plaintiff believed to be its agent. 

According to the allegations, Begualg believed that Interinvestments was its agent throughout the negotiations and transactions. Neither of the two principals of Begualg (Riojas nor Simental) were fluent in English. Begualg allegedly relied on Interinvestments to review the contracts and to interpret them. Interinvestments advised Begualg that the contracts were completely consistent with all of the Defendants’ pre-contractual promises. As it turned out, the contracts were inconsistent in many ways, containing material terms that stated the exact opposite of what the Defendants had promised Begualg in the negotiations. In addition to these allegations of fraud, Begualg alleged that the Four Seasons defendants were in breach of the rental program agreement, having failed to properly market Begualg’s condominium hotel units.

The defendants relied on the case of Benton, contending that the contract signed by Begualg was enforceable regardless of whether Riojas or Simental read it.  The court, however, distinguished Benton, noting that unlike the case before it, in Benton, there was no allegation or testimony that the defendants prevented the plaintiff from reading the contract or induced her to refrain from reading it or in any way prevented her from reading it or having it read to her by a reliable person of her choice.  In this case, Begualg had provided record citations to support its allegations that the Four Seasons defendants and Interinvestments conspired to prevent Begualg from reading the contract or induced it to refrain from reading it.

Ultimately, the appellate court noted that under the facts presented, no contract existed between the parties; while the rule is generally that a party cannot recover in fraud for alleged oral misrepresentations that are adequately covered or expressly contradicted in a later written contract, where a misrepresentation of the character or essential terms of a proposed written contract occurs, assent to the contract is impossible.  Due to Interinvestments’ conduct, and the reliance of Begualg upon Interinvestments, there was essentially an “ineffective assent to the contract.”

A party to a contract is generally charged with the knowledge of what is contained in the contract regardless of whether he read it.  While there may exceptions to this rule, the exceptions are narrow and often present difficulty of proof.  Accordingly, it is imperative for you to read and understand the contract you are signing, or retain the services of any attorney to otherwise protect your interests.  At Schecter Law, our attorneys’ attention to detail and their litigation background mean that Schecter Law approaches each agreement it prepares and reviews with a keen eye as to what will be required for an agreement to withstand judicial scrutiny.