Croker v. Palm Beach Estates
| Citation | 94 Fla. 171,114 So. 225 |
| Parties | CROKER v. PALM BEACH ESTATES et al. |
| Decision Date | 11 July 1927 |
| Court | Florida Supreme Court |
En Banc.
Suit by Bula E. Croker against Palm Beach Estates, a corporation, and another. From an order overruling a motion to strike certain portions of the joint and several answer and counterclaim of defendants, complaint appeals.
Affirmed.
Syllabus by the Court
Answer to bill to annual active trust in land may present complete history of transaction, purposes, parties, plans, and activities of all agencies. A bill in chancery to cancel or annul a trust, such as described in the first headnote, is subject to a defense by way of answer in which it is sought to present the complete history of the transaction, the purposes to be accomplished by the parties, the plans agreed upon, the activities of all agencies engaged to further such purposes to the end that, the character of the transaction being shown to be an express trust, all relevant facts may be received to explain the position of the parties, and that the court may accurately determine their relations, duties, and powers with respect to the subject-matter of the trust.
Appeal from Circuit Court, Palm Beach County; C. E Chillingworth, judge.
Treadwell & Treadwell, of Tampa, and John B. Singeltary, of Bradenton for appellant.
Fleming Hamilton, Diver, Lichliter & Fleming, of Jacksonville, and Blackwell & Donnell, of West Palm Beach, for appellees.
This is an appeal from an order overruling a motion to strike certain portions of the joint and several answer and overruling exceptions to certain portions of the joint and several answer and counterclaim of the defendants, Palm Beach Estates and J. B. McDonald, to the bill of complaint exhibited against them by the complainant, Bula E. Croker. The order was made July 10, 1925.
The appeal was also taken from an order dated September 19, 1925, denying complainant's petition for a rehearing on the motion to strike and the exceptions to certain portions of the answer. The notice of appeal was filed October 28, 1925.
On July 12, 1920, Bula Croker and her husband, Richard Croker, so it is alleged in the bill of complaint, were the owners of a certain tract of land in Palm Beach county in sections 11-14 and 23 in township 44 south, range 43 east. The property consisted of a narrow strip of land lying between Lake Worth and the Atlantic Ocean. The owners desired to sell it, and to that end negotiated with the defendant, J. B. McDonald, a real estate agent, broker, or realtor, of good reputation and substantial business interests. The Crokers were considering a visit to Ireland, the native land of the complainant's husband; negotiations concerning the sale and disposition of the lands and the price they were to bring and the commissions to be paid having been completed. The parties pursuant thereto entered into an agreement in which the Crokers were described as 'principals' and McDonald as 'agent.' It was recited that the Crokers had conveyed the lands to the 'agent' in order to carry out the agreement; that, in consideration of the mutual covenants and agreements and the profits to accrue to the 'principals and to the agent,' it was covenanted and agreed:
First, during five years succeeding the date of the agreement, the 'agent' should use all reasonable diligence to sell the lands upon the terms and conditions set out in the agreement. The conditions were: (a) That the lands were to be sold in tracts not less than 100 feet wide measured from north to south, and extending from the east edge of the channel of Lake Worth to low-water mark on the Atlantic Ocean, with all riparian rights at both ends; and from all sales of land having frontage on the Atlantic Ocean a strip of land 30 feet wide, now occupied by the Ocean Boulevard, should be excluded; (b) the lands were to be sold for not less than $150 per front foot measured in a northerly and southerly direction; (c) all purchasers were to be required to pay at least one-fourth cash and the balance in not longer than one, two, and three years in equal payments, with interest at 6 per cent. per annum for deferred payments, secured by first mortgage on the property. It was agreed that the principals during the five years following would pay when and as due all taxes. As each sale was made, the principals were to be 'reimbursed the proportionate amount of taxes paid on the land so sold for the period of time beginning with the date of this contract and ending with the date of such sale,' with interest on the minimum price of $150 per front foot at 6 per cent. per annum for such period; all excess over and above the total amount of said minimum sale price and interest and taxes should be 'retained by said agent as his remuneration for selling said lands and reimbursement to him of expenses incurred therein'; that at the end of five years the principals, or the survivor of them, or the heirs, legal representatives, or assigns of said survivor, will extend the agreement to cover all 'said lands then unsold for an additional five years next thereafter, if the said agent shall agree to pay, and pay when and as due, interest at the rate of 5 per cent. per annum' on the value of the then unsold parts of said property at $150 per front foot, and pay all taxes during the additional five years.
The fourth clause of the contract was as follows:
'At any time during the five years of the term of this contract, or at any time during the next five years thereafter, if the agent shall have exercised the option in the next preceding paragraph, the said agent may, at his option, pay the said principal, in cash, one-third of the value of all of the then unsold parts of said lands, based on the valuation of $150 per front foot, and then and there deliver to said principal his promissory notes representing the remaining two-thirds of said value payable in equal annual amounts in one, two, three, four, and five years thereafter with interest thereon at the rate of five per cent. per annum payable semiannually, secured by a first mortgage on said property, which mortgage shall provide for the release of any part thereof not less than one hundred feet in width from north to south upon the payment of $125 per front foot to be applied as part payment upon the next maturing one of said notes; and upon the making of said cash payment and execution and delivery of said notes and mortgage securing same, the said agent shall be absolute owner, indefeasibly, in fee simple of said lands.'
It was agreed that, upon the expiration of the contract by limitation, the 'agent' should reconvey all land which had not been meanwhile sold, 'provided said agent shall not meanwhile have become the owner thereof as hereinabove provided.' The 'agent' was to furnish the 'principal' itemized statements covering each and every sale made, and should keep permanent records which should be open to the inspection of the 'principals' at any time. The 'agent' was required to establish concrete monuments marking the exact boundaries of lands sold. The 'agent' was required to make all payments made under the agreement to Bula Croker, whose receipt for the same should be given. In the event of her death, the payments were to be made to Richard Croker, or his executors, administrators, or assigns.
The day upon which the above agreement was executed, and in furtherance of the plan outlined by it, the Crokers executed and delivered to McDonald, for a consideration of $10 each, and other valuable consideration, two deeds of conveyance vesting the legal title of the lands described in McDonald. Those deeds were duly recorded, but the agreement was not.
The testimonium clause of the agreement was as follows: 'Witness our hands and seals this 12th day of July, A. D. 1920, at West Palm Beach, Fla.' It was signed by Richard Croker and Bula Croker, each 'Principal,' and J. B. McDonald, 'Agent,' but no seal, scroll, or device of any kind was placed opposite their names, nor was scroll or device referred to in the agreement and adopted by the parties as their seal. The agreement was signed by two persons as witnesses. The execution of the instrument was acknowledged by the Crokers and McDonald before a notary public.
These instruments, the two deeds, and the agreement constituted an express trust, as between the parties and their privies, under which the trustee, McDonald, was charged with certain duties, coupled with an interest in the monetary profits resulting from his activities under his duties as trustee. It was an express trust, because the parties to the deeds at the time of their execution expressly impressed the title with the nature and character of a trust.' See Semple v. Semple, 90 Fla. 7, 105 So. 134; Lines v. Darden, 5 Fla. 51; Reid v. Barry (Fla.) 112 So. 846.
It was an active trust, because the trustee was required and empowered under the terms of the agreement to perform certain duties; the manner of the performance of which was left largely to his discretion. See Jourolmon v. Massengill, 86 Tenn. 81, 5 S.W. 719; Cooper v. Cooper, 36 N. J. Eq. 121; Perkins v. Brinkley, 133 N.C. 154, 45 S.E. 541; Dodson v. Ball, 60 Pa. 492, 100 Am. Dec. 586; Flaherty v. O'Connor, 24 R.I. 587, 54 A. 376; Cone v. Dunham, 59 Conn. 145, 20 A. 311, 8 L. R. A. 647; Freer v. Lake, 115 Ill. 662, 4 N.E. 512; 1 Perry on Trusts and Trustees, § 18.
It was a private, discretionary, active trust. See 1 Perry on Trusts and Trustees (6th Ed.) § 19.
The purpose of the trust was to effect a sale of the property through J. B. McDonald, in whom the title should be vested with power of sale, coupled with an interest in him to a portion of the proceeds of sale above a certain fixed and limited...
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...title to part of the property by deeds from Croker and wife. See Croker v. Croker (D. C.) 7 F.(2d) 218, 219; Bula Croker v. Palm Beach Estates, 94 Fla. 171, 114 So. 225. We have been greatly aided by the excellent briefs which have exhaustively collected and collated the significant feature......