Cushman v. Schubert, 574

• Decision Date: 08 April 1959
• Docket Number: No. 574,574
• Citation: 110 So.2d 703
• Parties: Merton J. CUSHMAN et al., Appellants, v. Alvin SCHUBERT, Appellee.
• Court: Florida District Court of Appeals

Page 703

110 So.2d 703

Merton J. CUSHMAN et al., Appellants, v. Alvin SCHUBERT, Appellee.

No. 574.

District Court of Appeal of Florida, Second District.

April 8, 1959.

Albert P. Schwarz, of Sanders, McEwan, Schwarz & Mims, Orlando, for appellants.

Joel Wells, Jr., of Maguire, Voorhis & Wells Orlando, for appellee.

JAMES R. KNOTT, Associate Judge.

This appeal is from a case which arose out of an involved series of transactions relating to the purchase of a large tract of land near Orlando. Only a relatively brief synopsis of the facts will be set out here.

It appears that appellee, plaintiff below, moved to Florida in January, 1954, being previously in the building and developing business in Ohio. Soon after arriving in Orange County he met W. S. Murchison, who was the owner of a 700 acre tract of land outside of Orlando, and thereafter entered a contract with him and one Ledman to develop this land. The costs and profits were to be divided equally. Plaintiff proceeded to improve the property, expending over $25,000 thereon, but his partners both failed to raise their share of the expenses and the development operations ceased when plaintiff ran out of funds. Thereafter plaintiff contacted one William Haynie and arranged for him to furnish the additional needed capital and share in the profits; however, this arrangement was also terminated, upon the death of Haynie's wife.

In his search for capital plaintiff next came in contact with the defendants, Merton J. Cushman and V. K. Cushman, and together with one Aaron Brown the parties entered into a third contract contemplating the development of Murchison's land. The Cushmans were to locate the capital for the venture, but failed to do so for several months. They then succeeded in getting one Cohen and Robert Brown to join them in the venture; however, as Cohen was to put up the bulk of the capital a new arrangement was necessary with plaintiff, as the agreement between him, the Cushmans and Aaron Brown contemplated a straight 25% of the profits for each. The deal was to be handled through the defendant, B.C.C. Corporation, which was owned by Cohen, the Cushmans and Robert Brown, so plaintiff signed a contract with B.C.C. which acknowledged the money invested and services rendered by plaintiff, and which provided that he would be paid $100 for each house built on the property and sold, and 5% of the total purchase price of any property sold as unimproved or vacant At the same time plaintiff signed an agreement which cancelled his former contract with the Cushmans and Aaron Brown.

At this point the plan was to have B.C.C. enter a new contract with Murchison for the purchase of the property, but Murchison objected to contracting with a corporation, so Merton J. Cushman contracted with him in his own name, with the understanding that the contract would be immediately assigned to B.C.C. At the time Merton J. Cushman entered into this contract with the owner, plaintiff pointed out that this would leave him with a contract with B.C.C., but the only substantial asset, the land contract, would be in Cushman's name. In view of this Cushman executed a memorandum to plaintiff stating that he would assign all his rights in the contract with Murchison to B.C.C., and plaintiff gave Cushman a general release. Although this contract never was assigned to B.C.C., the chancellor found as follows:

'A new contract to buy the property was entered into with Murchison in the name of the defendant Merton J. Cushman, but, in equity, the defendant B.C.C. Corp. must be regarded as the owner of the contract and entitled to all of its benefits.'

Nothing was done to close the contract with Murchison, and in June, 1957, it was assigned by Merton J. Cushman to M.J.C Inc., which was to perform the contract, and in addition, pay to Merton J. Cushman $417,000. It appears that all of the stock subscriptions in M.J.C., Inc., were assigned to one John Shakespeare prior to issuance of stock, so that in effect the contract was sold to Shakespeare.

The contract with Murchison has been, or is being performed by M.J.C., Inc., and calls for total payment of some $774,000.

Under these facts the chancellor found that the transaction was in effect a sale of all the property vacant or unimproved by B.C.C., and hence decreed plaintiff to be entitled to 5% of the total purchase price of $1,191,606.60; however, as $297,000 of the purchase price was in deferred payments to Merton J. Cushman, plaintiff would be entitled to his 5% of this amount only as the installments were paid, as was provided in his agreement with B.C.C.

The defendants have raised a number of points on appeal, but they are aimed primarily at two basic contentions; one, that this case was not one properly cognizable by equity, and two, that the chancellor erred in his interpretation of the effect of the acquisition and disposition of the final contract with the property owner, the contract that ultimately found its way to John Shakespeare after increasing in value some $417,000.

In support of their first contention, lack of any basis for equitable relief, defendants strenuously urge that plaintiff should have been relegated to his remedy at law, if any, pointing out that he sought to invoke the aid of equity primarily to obtain an accounting, and where a complaint shows on its face that the amounts claimed are fixed and certain equity will decline the suit. 1 Fla.Jur., Accounts and Accounting, Section 14. Defendants further allege that plaintiff cannot prevail under the theory that he is entitled to an accounting as a joint adventurer, Donahue v. Davis, Fla.1953, 68 So.2d 163, because all the elements necessary to create a joint venture, as expressly enumerated by our Supreme Court in Kislak v. Kreedian, Fla.1957, 95 So.2d 510, are not present here. While it does appear that the element of control or...