Fulton v. Clewiston, Limited

• Decision Date: 24 July 1930
• Citation: Fulton v. Clewiston, Limited, 100 Fla. 257, 129 So. 773 (Fla. 1930)
• Parties: FULTON et al. v. CLEWISTON, Limited, et al.
• Court: Florida Supreme Court

129 So. 773

100 Fla. 257

FULTON et al. v. CLEWISTON, Limited, et al.

Florida Supreme Court

July 24, 1930

En Banc.

Suit by Tea Fulton and another against Clewiston, Limited, and the Clewiston Company, Incorporated, wherein defendantClewiston Company, Incorporated, filed cross-bill.From the decree rendered, complainants and cross-defendants appeal.

Affirmed.

BROWN J., dissenting.Appeal from Circuit Court, Hendry CountyGeorge W. Whitehurst, judge.

COUNSEL

R. C. Horne, C. B. Smith, and R. H. Rowe, all of Madison, for appellants.

Doggett Christie & Doggett, of Jacksonville, for appellees.

OPINION

ELLIS J.

As accurately as we are enabled to gather the facts of this case from the evidence, as shown by the record, they appear to be about as follows:

The Clewiston Development Company, whose activities seemed to be directed by I. T. Cook and F. D. Duff, was engaged in the early part of 1924 in acquiring subdivision of a tract of land in section 16 of township 43 south, range 34 east, in Florida.The subdivision was to be known as Everglades Gardens subdivision.These men and others, including B. G. Dahlberg, were preparing to organize a corporation to be known as Clewiston, Limited.The corporation was organized later, and afterwards its capital stock was increased and name changed to Clewiston Company, Incorporated.There was a tract of about fifty-five acres embraced within the area to be platted to which the Clewiston Development Company did not have title and which it desired to procure before proceeding with the work.Lying within the fifty-five acres was a tract of twenty acres consisting of four five-acre tracts; one of these five-acre tracts was owned by J. T. Taylor who was a real estate broker located in Moore Haven.Mr. Cook and Mr. Duff, in August, 1924, began negotiations for the purchase of the property owned by Clewiston Development Company in behalf of Clewiston, Limited, the corporation in process of organization of which Mr. Cook was to be president and of which he became president.

Later during the year, some time in October or November and again in December, both Cook and Duff applied to J. T. Taylor to engage his services as real estate agent or broker to acquire the eleven five-acre tracts for the Clewiston, Limited, which had acquired the properties of the Clewiston Development Company.Negotiations were completed with Mr. Taylor to acquire lots 1 of block 2, lots 15 and 16 of block 3, and lots 1 of block 4 of Everglades Gardens subdivision.Those lots covered an area of twenty acres.Taylor owned one of the lots and said he had information as to the ownership of the other three.Cook and Duff told him that they would buy his lot at $200 per acre, but they could not use it unless they could acquire the others, as they were necessary to their scheme of development of the area.Taylor agreed to act as their agent in procuring the other lots at what was then the estimated value of the land about $150 or $200 per acre.Taylor expressed the opinion that the other tracts could be acquired at that price and possibly at $100 per acre.

No definite agreement was made as to commission or compensation to be paid him.Taylor then proceeded to purchase the other lots at $100 per acre and had the title conveyed to Tea Fulton, a woman living at Tampa, a friend of Taylor.

Several times prior to the completion of the organization of Clewiston, Limited, Cook had conferences with Taylor about the purchase of the lots, but Taylor seemed to procrastinate and delayed bringing the negotiations to a conclusion until some time in April, 1925, when Cook and Dalhberg, talking with Taylor about the transaction, were informed by him that he wanted $500 per acre for his tract, and that he thought that he would have to pay up to $300 per acre for the other land.He did not tell them that the lady Tea Fulton had acquired them.Taylor was to report further what he could do in the matter.In the meantime Taylor was fully advised of the platting of the 'Clewiston Townsite' and that it was almost necessary that the Clewiston, Limited, Corporation should acquire the lots.The Taylor lands were in the center of the townsite and the other lands more to the west of the Taylor lands and south of the Cross-State highway which intersects Clewiston running east and west.

Some time after April, 1925, Taylor told Cook that he would have to deal with Mrs. Tea Fulton, as she had purchased the lots; that Taylor had talked with her about the property; that he owed her some money and she wanted $1,500 an acre for the land.Cook informed Duff about this situation, and Cook, Duff, and Mr. Urban went to Tampa to confer with Mrs. Fulton about the property, and she informed them that she would agree to whatever Taylor did in the matter.

Soon after this Mr. Cook ceased to be president of the Clewiston, Limited, and was succeeded by Mr. Dahlberg.Several trips were made by Cook to see Mrs. Fulton, which resulted in no consummation of the trade.

At last the trade was closed.The Clewiston, Limited, acquired the property from Mr. Taylor and Mrs. Fulton at the price of $1,250 per acre.The price was agreed to by Cook, but it seems that Dahlberg, as president of the corporation, concluded the trade.Cook did not inform Dahlberg of all the facts of which he became cognizant in his conversation with Taylor.Cook suspected but did not know of the actual fraud perpetrated by Taylor.Ten thousand dollars was paid on the purchase price of the land, and the Clewiston, Limited, by Dahlberg, as president, executed its promissory note to Tea Fulton and J. T. Taylor jointly for $15,000 payable on or before six months after date.The note was dated October 23, 1925.A mortgage was executed by the company upon the property to secure the payment of the note.

On October 23, 1926, Mrs. Tea Fulton and J. T. Taylor exhibited their bill of complaint in the circuit court for Hendry county to foreclose the mortgage.Five thousand dollars had been paid on the note on July 1, 1926, as well as interest to that date.After the execution of the note and mortgage the Clewiston, Limited, company changed its name to Clewiston Company, Incorporated.

The Clewiston Company, Incorporated, answered, averring the facts as above stated in substance and charged fraud upon the part of Mrs. Fulton and Taylor, and averred that the facts as fully recited in the answer were not discovered by the corporation until after the payment by it in July, 1926, of the $5,000 on the note.The answer averred that Mrs. Fulton had no interest in the transaction which was for the sole secret profit of Taylor; that the lands were not reasonably worth more than $300 per acre.The answer was followed by a cross-bill in which the details of the transaction were alleged.Taylor was charged with fraud in his dealing with the cross-complainant in the transaction; that the use of Mrs. Fulton in the transaction was for the purpose of carrying out the fraudulent scheme of Taylor; that she was never the owner of the land in good faith either in law or equity, and that Taylor merely held her name out in the transaction to export from the cross-complainant an exorbitant and unreasonable price for the property; that as soon as Dahlberg learned of the fraud he took immediate steps to obtain an accounting from Taylor of his secret profits.The...