Beverly Beach Properties v. Nelson

• Decision Date: 27 February 1953
• Citation: 68 So.2d 604,41 A.L.R.2d 1071
• Parties: BEVERLY BEACH PROPERTIES, Inc. et al. v. NELSON et al.
• Court: Florida Supreme Court

Page 604

68 So.2d 604

41 A.L.R.2d 1071

BEVERLY BEACH PROPERTIES, Inc. et al. v. NELSON et al.

Supreme Court of Florida, Special Division A.

Feb. 27, 1953.

On Rehearing July 31, 1953.

Rehearing Denied Dec. 3, 1953.

Ward & Ward and Myers, Heiman & Kaplan, Miami, for appellants Beverly Beach Properties, Inc., and Samuel Friedland.

Hall, Hedrick & Dekle, Miami, for appellant Glynn O. Rasco.

Evans, Mershon, Sawyer, Johnston & Simmons and Herbert S. Sawyer, Miami, for appellant E. L. Lockhart.

Carl A. Hiaasen, McCune, Hiaasen & Kelley, Fort Lauderdale, for appellees.

PER CURIAM.

This is the second time we have been called on to consider this case. Nelson v. Beverly Beach Properties, Inc., Fla., 47 So.2d 310, wherein it was found that we had rarely been confronted with a case that ran into such involved and tedious complexities. We were convinced that the rights of all the parties should be settled in the litigation and reversed for that purpose. The mandate went down, testimony was taken and the chancellor entered a decree adjudicating the equities of the parties. We are now confronted with appeals and cross-appeals from the chancellor's decree.

Numerous questions are urged for reversal. In his opinion the chancellor found that on account of the lapse of time, complexities, and the cross-currents generated by the parties and their counsel in attempting to realize on their claims, the rem had become so involved that it would be impossible to place them all in status quo. We so indicated in the former opinion. The pleadings and the evidence on which the chancellor's decree was predicated have been examined and we cannot say that error is clearly shown. We have searched diligently and are not advised in what respect the quality of justice could have been improved.

If another opinion would serve any useful purpose, we could do no better than to adopt the opinion and findings of the chancellor. They are detailed definite and specific. He knew the parties and the subject matter and was in much better position to pronounce justice than we are. The law of the case was pronounced in the former opinion and appears to have been followed scrupulously.

The judgment is accordingly affirmed.

Affirmed.

HOBSON, C. J., and TERRELL, THOMAS and MATHEWS, JJ., concur.

On Rehearing Granted

HOBSON, Justice.

This case made its first appearance before this Court, 47 So.2d 310, 317, on an appeal from an order of the presiding Chancellor which order was in effect a 'split' decree in that it was final in some respects and interlocutory in others.

We wrote and released an opinion but, upon petition for rehearing, we modified the original opinion, our exact language being:

'We have rarely if ever been confronted with a case that ran into such involved and tedious complexities. We are convinced that the rights of all the parties should be settled in this litigation and reversed the judgment primarily for that purpose. Nothing said in our opinion was intended to prejudice the rights of any litigant, or to impede the chancellor in arriving at a proper decision.' (Italics supplied.)

After the going down of our mandate the lower court, in obedience thereto, directed E. L. Lockhart, one of the claimants, to interplead and bring into the case the matters and things upon which he was relying for relief. When the cause was thus reopened extensive testimony was introduced by and on behalf of Lockhart. This additional testimony might have persuaded the Chancellor, but obviously it did not do so, to the conclusion that the price paid by appellants for the wild, unimproved, low-lying, unfilled acreage involved herein at the time of the sale (June, 1945) and under conditions then existing was the highest and best price obtainable, was fair and not grossly inadequate. Such testimony did appearently assist in convincing the Chancellor that Mr. Samuel Friedland was not guilty of actual fraud in the transaction wherein he purchased the real property which is the subject matter of this litigation.

As we understand it, the Chancellor was of the opinion and so decided that Mr. Friedland was guilty of constructive fraud (of which Beverly Beach Properties, Inc., cannot say it did not have notice because that corporation is Friedland's alter ego) in that he rushed through a 'quick deal', which he knew was a good one for him, without 'making any reasonable inquiry or investigation of the records of the corporation' which, had he done, he 'could have been advised of the illegality of the meeting of the stockholders and directors because of the lack of any valid authorization to bind the interest of Olof Zetterlund as a stockholder and hence should be charged with knowledge of the fact that the newly elected purported officers of the corporation in fact had no valid authority to execute a deed for it.'

In our recent opinion to which this petition for rehearing is addressed we said: 'The law of the case was pronounced in the former opinion and appears to have been followed scrupulously.'

In their petition for rehearing counsel for appellants take the position that in the first appearance of this case in this Court we did nothing more than reverse the cause for further proceedings with directions that the rights of all the parties be settled in this one suit. It is their position that the modification of our original opinion on the former appeal wherein we said: 'Nothing said in our opinion was intended to prejudice the rights of any litigant' considered in the light of our reversal, should be construed as a holding that we had not settled any questions of law presented in and by the original appeal and that in our recent opinion we failed to consider such fact when we said: 'The law of the case was pronounced in the former opinion * * *.'

Furthermore, counsel insist that if we held in our former opinion that a foreign guardian could not vote shares of stock of a corporation belonging to his ward as distinguished from selling real property situated in Florida which is owned by his ward, we departed from established law, failed to give full faith and credit to the judgment of the California court as required by Section 1, Article IV, of the Federal Constitution and should, on this petition for rehearing, hold that the California guardian had the right to vote the shares of stock which belonged to her ward, Olof Zetterlund, in stockholders' and directors' meetings of Elsinore Beach Corporation and Halland Land Company.

Counsel for appellees insist (1) that we decided in our opinion in 47 So.2d 310 that the Chancellor was correct in holding the guardian for Olof Zetterlund appointed by the California court had no authority to vote the shares of stock owned by her ward in the two Florida corporations, to-wit: Elsinore Beach Corporation and the Halland Land Company; (2) that such pronouncement became the law of the case and cannot now be overturned and (3) that in any event the Chancellor was correct in his original and final holding that the California guardian was not authorized to vote the shares of stock owned by her ward, Olof Zetterlund, in the two aforementioned Florida corporations and that the action of the corporations in selling the land to Samuel Friedland was void.

The position taken by counsel for appellants that we did no more in our opinion, and modification thereof, on the original appeal, than reverse the judgment and did not decide as a matter of law that the California, guardian could not vote the stock owned by Olof Zetterlund in Elsinore Beach Corporation and the Halland Land Company is not devoid of merit. However, it is unnecessary to follow their argument since we are now of the opinion that the Chancellor erred in deciding as a matter of law that the California guardian had no authority to vote by proxy the shares of stock belonging to her ward and that we almost perpetuated such error.

This is the same suit and we have not lost jurisdiction thereof. Consequently, we have the power to correct any error which the Chancellor or we may have heretofore made in the progress of this litigation. There is no question of res adjudicata because this is the same, not a new and different, suit. However this Court, among others, has gone so far as to hold that it will not invoke the doctrine of res adjudicata if to do so would work injustice. The propriety of such ruling can not be questioned when one reflects upon the fact that the primary purpose for which our courts were created is to administer justice. In the case of Wallace v. Luxmoore, 156 Fla. 728, 24 So.2d 302, 304, we said:

'Stare decisis and res adjudicata are perfectly sound doctrines, approved by this court, but they are governed by well-settled principles and when factual situations arise that to apply them would defeat justice we will apply a different rule. Social and economic complexes must compel the extension of legal formulas and the approval of new precedents when shown to be necessary to administer justice. In a democracy the administration of justice is the primary concern of the State and when this cannot be done effectively by adhering to old precedents they should be modified or discarded. Blind adherence to them gets us nowhere.'

A Court should have less hesitancy in changing 'the law of the case' before losing jurisdiction than it would have in refusing to apply the doctrine of res adjudicata when all the requisites thereof are present. We may change 'the law of the case' at any time before we lose jurisdiction of a cause and will never hesitate to do so if we become convinced, as we are in this instance, that our original pronouncement of the law was erroneous and such ruling resulted in manifest injustice. In such a situation a court of justice should never adopt a pertinacious attitude.

As heretofore observed, we have concluded that both the Chancellor and this Court (if indeed we did so decide) were in error in determining that the California...