138 So.2d 795 (Fla.App. 2 Dist. 1962), 2866, Corr v. Leisey

Docket Nº:2866.
Citation:138 So.2d 795
Party Name:Francis J. CORR and Dorothy Corr, his wife, Appellants, v. C. E. ELISEY, Appellee.
Case Date:March 09, 1962
Court:Florida Court of Appeals, Second District
 
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Page 795

138 So.2d 795 (Fla.App. 2 Dist. 1962)

Francis J. CORR and Dorothy Corr, his wife, Appellants,

v.

C. E. ELISEY, Appellee.

No. 2866.

Florida Court of Appeals, Second District.

March 9, 1962

Rehearing Denied March 27, 1962.

Hugh C. Macfarlane and William Terrell Hodges, Macfarlane, Ferguson, Allison & Kelly, Tampa, for appellants.

Marvin E. Barkin and Leslie D. Scharf, Fowler, White, Gillen, Humkey & Trenam, Tampa, for appellee.

ALLEN, Judge.

Appellant, defendant below, brings this interlocutory appeal from an order striking certain of his amended affirmative defenses which had been previously stricken several times.

Plaintiff brought suit to impose a constructive trust upon a portion of certain lands held by defendant and acquired by him from the Ruskin Vegetable Cooperative in which plaintiff was a director. The complaint alleges that prior to the purchase by defendant, plaintiff had also been interested in acquiring this land. Defendant had approached the plaintiff and proposed that if the plaintiff would refrain from purchasing the land but would approve its sale to defendant by the cooperative in which plaintiff was a director, defendant would, in consideration for such forbearance and approval, convey a certain portion of the land to plaintiff. The plaintiff accepted this proposition and then wrote a letter to the cooperative stating:

'This letter is written to advise you that I am approving the sale of the 15 acres at corner of Miller mac Road and U. S. 41 to Francis J. Corr for the sum of $15,000.00 with the understanding that I am to receive the corner 200 ft. X 200 ft. from Francis J. Corr.'

Defendant Corr initialed this letter and scratched out the $15,000.00 figure, substituting instead the figure $20,000.00. After

Page 796

defendant acquired the land from the cooperative, plaintiff called upon him to convey to plaintiff the corner 200 ft. X 200 ft. and defendant refused.

Defendant answered, admitted signing the letter to the cooperative, denied any duty as a constructive trustee and alleged certain affirmative defenses. The affirmative defenses in the amended answer which were stricken by the order appealed from alleged that plaintiff was a vice-president and director of the cooperative at all times material; that plaintiff had refused to approve the sale of the land to defendant and had been personally interested in acquiring the land; that the other directors of the cooperative had been unwilling to sell the land to the defendant until the plaintiff approved the sale; and that such approval was given on condition that defendant reconvey the corner lot to plaintiff.

Whereupon defendant alleged that this conduct by the plaintiff was a breach of his fiduciary duty to the cooperative; that the ultimate conveyance to the plaintiff would result in his acquiring the land from the cooperative free of cost; that the alleged agreement of reconveyance would result in defendant receiving less than the total land purchased and a sale of land by the cooperative at less than full market value; and that the sale of land at less than its full market value pursuant to an agreement by which the plaintiff, an officer and director of the cooperative, would derive a personal profit not shared in common with other stockholders was a fraud on the cooperative and contrary to public policy.

In essence, the affirmative defenses allege that the agreement entered into by plaintiff, as a corporate director, was self dealing under the agreement to the detriment of the cooperative; and that a self dealing contract by a corporate director concerning the disposition of corporate property is unenforceable against a third party as being contrary to public policy.

The portions of the affirmative defenses not stricken leave a factual issue pending in the cause below relating to whether further negotiations as to price for the reconveyance of the corner lot were contemplated by plaintiff and defendant in their agreement.

The circuit judge stated that he was of the opinion that the alleged contract would be enforceable between the plaintiff and defendants unless there was fraud or bad faith exercised by the plaintiff on the Directors of the Ruskin Vegetable cooperative through a lack of full disclosure to said board of directors, and thereafter struck various defenses raising this question.

This court, in a recent case, Schaal v. Face, Fla.App.1961, 135 So.2d 252, held that a contract could not be enforced, although fully executed, as far as services rendered were concerned where a public policy statute of the state...

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