Legal Memorandum: Allie II Stands Good Law in FL

Issue: In Florida, what is the status of Allie v. Ionata, 503 So. 2d 1237 (Fla. 1987) (Allie II) after Wood v. Eli Lilly & Co., 701 So. 2d 344 (Fla. 1997) as authority?

There is no doubt that Allie II remains good law today.  Subsequent cases, including one Florida District Court of Appeal (Fourth District) case that was affirmed by both the Florida Supreme Court and the U.S. Supreme Court, have cited to Allie II in support of the general proposition that “recoupment may be asserted even though the underlying claim is barred by the applicable statute of limitations as an independent cause of action . . . [T]he defendant may assert any affirmative defense or compulsory counterclaim which stems from the same transaction.”  Beach v. Great W. Bank, 670 So. 2d 986, 991 (Fla. 4th Dist. Ct. App. 1996), aff’d, 692 So. 2d 146 (Fla. 1997), aff’d, 523 U.S. 410 (1998).

Allie II, however, has been narrowed, or very specifically defined, such that an action in recoupment may not be available in all situations where a defendant seeks to assert a counterclaim that would otherwise have been time barred if brought independently.  Allie II specifically “considered the application of limitations to claims for damages at common law.”  503 So. 2d 991 (emphasis added).  And its holding “rested primarily on considerations of public policy and fairness as well as an analysis of the purpose of statutes of limitation.”  Id.  Other Florida cases have distinguished Allie II (and/or recoupment as defined by Allie II) from defensive counterclaims brought under statutes that contained limitation periods and thus denied recoupment as a viable avenue of recovery.  In such cases, the […]