Freeman v. Berrin

• Decision Date: 02 December 2022
• Docket Number: 2D21-1885
• Parties: BRIAN FREEMAN, as Successor Trustee of The Fiddlesticks Land Trust U/A/D September 25, 1984, Appellant, v. ROZ BERRIN a/k/a ROSLYN BERRIN, ROBERT BERRIN, and STEVEN ROBINSON, Appellees.
• Court: Florida District Court of Appeals

BRIAN FREEMAN, as Successor Trustee of The Fiddlesticks Land Trust U/A/D September 25, 1984, Appellant, v. ROZ BERRIN a/k/a ROSLYN BERRIN, ROBERT BERRIN, and STEVEN ROBINSON, Appellees.

No. 2D21-1885

Florida Court of Appeals, Second District

December 2, 2022

Appeal pursuant to Fla. R. App. P. 9.130 from the Circuit Court for Lee County; Joseph C. Fuller, Jr., Judge.

John Charles Coleman and Thomas G. Coleman of Coleman &amp Coleman, Fort Myers, for Appellant.

Mark C Anderson of Anderson Law, PLLC, Fort Myers, for Appellees.

ROSE Judge.

Brian Freeman appeals the trial court's nonfinal order entering a temporary injunction that removed him as successor trustee of The Fiddlesticks Land Trust U/A/D September 25, 1984 (hereinafter, the Fiddlesticks Trust). The trial court improperly applied the Florida Trust Code, ch. 736, Fla Stat. (2020), to an action involving a land trust governed by the Florida Land Trust Act, § 689.071, Fla. Stat. (2020). Nevertheless, the trial court permissibly granted the temporary injunction in favor of Roz Berrin, Robert Berrin, and Steven Robinson (collectively, the Beneficiaries) because they demonstrated entitlement to injunctive relief under the common law.

I. Background

In 1984, Mr. Freeman's father, Jeffrey Freeman, joined with the Beneficiaries and others to invest in two adjacent parcels of land in Lee County. They executed separate Certificates of Participation and related documents to create two land trusts. Jeffrey Freeman was the trustee of both, with the "power and authority to protect and conserve, and to sell or lease or to encumber or otherwise to manage and dispose of the real property described in this instrument, as more specifically set forth in Florida Statute 689.071."

The Certificates of Participation were virtually identical. They authorized the trustee to sell, mortgage, or lease the trust property with "the written consent of a majority in interest of the beneficial owners of the property." The trustee was also authorized to sell the property without consent if presented with a bona fide offer to purchase the property within five years. The Certificates of Participation provided that "[n]either the [trustee] nor the [b]eneficiaries will engage in any form of trade or business with respect to the [p]roperty." The Certificates of Participation did not provide for removal of the trustee or mention chapter 736 or a predecessor trust code.

In 1997, the Beneficiaries combined the two trusts into a single land trust, the Fiddlesticks Trust, under an amended Certificate of Participation. The terms of the prior Certificates of Participation remained in force unless expressly modified by the amendment.

The Beneficiaries held minority beneficial interests, and Jeffrey Freeman held the majority interest, in the Fiddlesticks Trust. Upon his death in 2011, Jeffrey Freeman's interest passed to his estate; Brian Freeman became the successor trustee.

In 2018, Mr. Freeman, as successor trustee, sued the Beneficiaries. He sought to foreclose on liens against their beneficial interests for failure to pay their pro rata shares of expenses pursuant to the terms of the Certificates of Participation.

The Beneficiaries filed counterclaims against Mr. Freeman. They alleged that he breached his fiduciary and contractual duties by failing to provide an accounting and access to trust records upon demand; failing to provide records verifying the amount, source, and reason for advancements made by Mr. Freeman and his father's estate on behalf of the Fiddlesticks Trust; charging unreasonable management fees; and failing to advise the Beneficiaries of a condemnation action by the county. The Beneficiaries asked the trial court to remove Mr. Freeman as trustee and to order an accounting of trust assets and liabilities.

In December 2020, the Beneficiaries moved for a temporary injunction to remove Mr. Freeman as the successor trustee based on section 736.0706(2)(a) and irreparable harm caused by Mr. Freeman's alleged ongoing breaches of his contractual and fiduciary duties. As in their counterclaims, the Beneficiaries alleged that Mr. Freeman breached various fiduciary and contractual obligations.

After a hearing, the trial court granted the Beneficiaries' motion and removed Mr. Freeman as trustee.

II. Discussion

A. Application of Chapter 736 to a Land Trust

Mr. Freeman asserts that the trial court erroneously applied chapter 736's removal provision to a chapter 689 land trust. The Beneficiaries urge us to apply chapter 736 to the Fiddlesticks Trust because land trusts are essentially the same as ordinary trusts.

We review questions of statutory interpretation de novo. See Page v. Deutsche Bank Tr. Co. Ams., 308 So.3d 953, 958 (Fla. 2020) (citing Lieupo v. Simon's Trucking, Inc., 286 So.3d 143, 145 n.2 (Fla. 2019)). "[T]he supremacy-of-the-text principle" guides our determination of the meaning of the statute: "[T]he words of a governing text are of paramount concern, and what they convey, in their context, is what the text means.'" Levy v. Levy, 326 So.3d 678, 681 (Fla. 2021) (quoting Page, 308 So.3d at 958).

The Fiddlesticks Trust is a section 689.071 land trust. See § 689.071(12)(b)1 (providing that a trust created before June 28, 2013, is a land trust governed by the Florida Trust Act if "a recorded instrument confers on the trustee the power and authority described in s. 689.073(1)" and the recorded instrument or the trust agreement either "expressly provides that the trust is a land trust" or indicates that the parties intended "that the trust be a land trust . . . without regard to whether the trustee's duties under the trust agreement are greater than those limited duties described in paragraph (2)(c)"); see also § 689.071(1), (2)(c).

The legislature passed the Florida Land Trust Act to permit the use of land trusts, also known as Illinois Land Trusts, in Florida.^[1]Lawyers' Title Guar. Fund v. Koch, 397 So.2d 455, 457 (Fla. 4th DCA 1981). In contrast, the Florida Trust Code, codified in chapter 736,^[2] governs "express trusts . . . and trusts created pursuant to a law, judgment, or decree that requires the trust to be administered in the manner of an express trust." § 736.0102(1).

But for exceptions not applicable here, section 689.071(12) provides that the Florida Trust Code does not apply to land trusts. See § 689.071(7), (12)(b)2. Even before the legislature added subsection (12), the statute indicated that the Florida Trust Code, generally, did not apply to land trusts. § 736.0102, Fla. Stat. (2007-2020) (explaining that the Florida Trust Code does not generally apply to land trusts); § 731.201(33), Fla. Stat. (1997) (excluding land trusts under section 689.05 from the definition of "trust" in chapter 737 "unless the context requires otherwise"); § 731.201(32), Fla. Stat. (1984) (same).

To support Mr. Freeman's removal, the Beneficiaries want us to insert the provisions of section 736.0706 into land trust law. This, we cannot do. The legislature is the proper branch of government to alter the statutory text. See State v. Lewars, 259 So.3d 793, 798 (Fla. 2018) (explaining that courts may not "construe an unambiguous statute in a way which would extend, modify, or limit[] its express terms or its reasonable and obvious implications"; and that "[s]uch a construction 'would be an abrogation of legislative power'" (first alteration in original) (quoting Holly v. Auld, 450 So.2d 217, 219 (Fla. 1984), abrogated on other grounds by Conage v. United States, 346 So.3d 594, 598 (Fla. 2022) (stating that the courts may consider the statutory context and canons of statutory interpretation to determine "whether a term has a 'plain' or 'clear' meaning"))).

The case law upon which the Beneficiaries and the trial court rely is inapposite. Brigham v. Brigham, 11 So.3d 374 (Fla. 3d DCA 2009), did not involve a land trust. See id. at 384 (holding that because the attorney failed to "to create a Florida Land Trust under section 689.071, [the trust at issue] is a trust regulated by chapter 737"). Any suggestion in Brigham that the Florida Trust Code applies to section 689.071 is dicta. See generally Lewis v. State, 34 So.3d 183, 186 (Fla. 1st DCA 2010) ("When a court makes a pronouncement of law that is ultimately immaterial to the outcome of the case, it cannot be said to be part of the holding in the case. . . . Consequently, in the context of the instant case, the statements are dicta and not binding on this court.").

Further, In re Saber, 233 B.R. 547 (Bankr. S.D. Fla. 1999), a case quoted in Brigham and relied on by the Beneficiaries, is also off the mark. That case involves a bankruptcy case and addresses the common law merger doctrine, an issue not before us. See In re Saber, 233 B.R. at 549, 553 ("Well-established Florida case law dictates that the legal and equitable interests are merged where nothing remains to be done to carry out the intention of the settlor.").^[3]

B. Removal of a Land Trustee Under the Common Law

Despite the inapplicability of section 736.0706, the Beneficiaries asserted irreparable harm caused by Mr. Freeman's alleged ongoing breaches of his duties.^[4] Although the order before us is peppered with references to the fiduciary duties listed in chapter 736, we cannot ignore that the trial court separately found that Mr. Freeman's alleged conduct constituted a "serious breach of trust." The trial court listed Mr. Freeman's duties in its order:

1. The Trustee holds "legal title to the Property as an agent for the Beneficiaries, and solely for the convenience of the Beneficiaries, in order to facilitate the management and disposal of the Property . . . ."

2. The Trustee "will take no action with respect to the Property . . . without the

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