CJ Restaurant Enterprises, Inc. v. FMS Management Systems, Inc., 96-2809
| Decision Date | 30 July 1997 |
| Docket Number | No. 96-2809,96-2809 |
| Citation | 699 So.2d 252 |
| Parties | 22 Fla. L. Weekly D1839 CJ RESTAURANT ENTERPRISES, INC., Appellant, v. FMS MANAGEMENT SYSTEMS, INC., Appellee. |
| Court | Florida District Court of Appeals |
Rubin, Baum, Levin, Constant, Friedman & Bilzin, and Alvin D. Lodish, and Sherril M. Colombo, Miami; Christopher B. Waldera, Ft. Lauderdale, for appellant.
Atlas, Pearlman, Trop & Borkson, P.A., and Jan Douglas Atlas, and Wayne H. Schwartz, Ft.Lauderdale, for appellee.
Before COPE, GREEN, and SORONDO, JJ.
This is an appeal from the entry of an ex parte final judgment of possession and permanent injunction pursuant to a stipulation and agreed order between the parties to this appeal. For the reasons which follow, we reverse.
Appellant C.J. Restaurant Enterprises, Inc. ("CJ"), was licensed by appellee FMS Management ("FMS"), to operate eight International House of Pancakes (IHOP) restaurants. Pursuant to the terms of the license agreements, CJ was required to make weekly sales and remittance payments to FMS based upon the gross sales of each restaurant. CJ, however, routinely made and FMS accepted such payments 2 to 3 weeks after their due date. The terms of the license agreements further provided that upon CJ's default of any payment due, FMS was to provide written notice thereof to CJ and allow CJ to cure the default within five business days after CJ's receipt of the notice or within five days of CJ's first refusal to accept the written notice. CJ's failure to cure the default could result in the termination of the license agreements and FMS' repossession of the same.
CJ subsequently fell into arrears in its payments to FMS. At the time, CJ had invested a substantial amount of money to make improvements to these restaurants and was in the process of attempting to sell at least two of the restaurants subject, of course, to FMS' approval. FMS filed a three count complaint below on March 12, 1996 for an injunction, breach of contract/accounting, and the recovery of possession of all of the restaurants. Rather than litigate the matter, the parties immediately entered into a stipulation and agreed order which purportedly was to serve as FMS' last act of forbearance. In this stipulation and agreed order, CJ acknowledged its outstanding indebtedness and the parties specifically agreed that beginning March 22, 1994 and ending September 30, 1996, CJ would make twenty-eight weekly payments in the amount of $3,802.44 to satisfy its outstanding indebtedness, and its failure to make any one payment on a timely basis would result in the restaurants being returned to the possession, ownership, and operation by FMS. The stipulation further provided in relevant part that:
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5. [CJ] has received all required Notices of Default and acknowledges that it is in breach of the Agreements, and that there is no remaining opportunity to cure.
6. CJ ... shall deliver cash or a cashier's check in the amount of $3,802.44 payable to FMS.... This amount represents the first of twenty-eight (28) weekly installments....
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8. Additionally, throughout the aforesaid twenty-eight (28) week period and thereafter ... [CJ] shall pay ... all sums as they become currently due and owing under the Agreements....
9. [I]n the event of [CJ's] failure to strictly comply on a timely basis with each and every provision ... then it shall deliver the keys of the restaurants to [FMS] and surrender possession ... to [FMS], failing which a Judgment and Writ of Possession shall issue ... [CJ] will refrain from engaging in any business similar to an [IHOP] within a ten (10) mile radius of any of the above eight (8) locations for a period of two years ... [CJ] will refrain from using or divulging any of [FMS's] trade secrets....
After this stipulation and agreed order was executed by the parties and approved by the court, it is undisputed in the record that CJ continued to be delinquent by 2 to 3 weeks in its scheduled payments under the stipulation and that FMS accepted the same. It is also undisputed that notwithstanding the parties' agreement that CJ make its payments in the form of cash or cashier's checks, CJ made and FMS accepted payments by checks. When some of CJ's checks were returned for insufficient funds, FMS allowed them to be replaced by other forms of payment such as cashier's checks. Although FMS subsequently requested in a letter dated August 29, 1996 that CJ make all future payments by cashier's checks, FMS continued to accept CJ's personal checks thereafter.
On October 2, 1996, two days after CJ had made its twenty-eighth payment due under the stipulation, but while CJ was still in arrears on its...
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