General Development Corp. v. Catlin, 61-227
Decision Date | 10 April 1962 |
Docket Number | No. 61-227,61-227 |
Citation | 139 So.2d 901 |
Parties | GENERAL DEVELOPMENT CORPORATION, Appellant, v. Robert L. CATLIN, Appellee. |
Court | Florida District Court of Appeals |
Paul & Sams and Parker Thomson, Miami, for appellant.
Sibley, Grusmark, Giblin, King & Levenson and Charles Danton, Miami Beach, for appellee.
Before PEARSON, TILLMAN, C. J., and CARROLL and HENDRY, JJ.
The General Development Corporation was defendant in an action for specific performance brought by Robert L. Catlin, as plaintiff. The trial court entered a final decree ordering the specific performance prayed and the Corporation appeals.
Catlin was an employee of General Development Corporation. During the period of this employment, he entered into a stock option agreement with the Corporation. By the terms of this agreement, Catlin represented that if he should exercise the option to purchase the stock covered by the agreement he would:
'(A) * * * acquire the stock subject to this option for investment and not with a view to distribution; and
'(B) * * * not sell or distribute any of the stock that he may obtain hereunder otherwise than in compliance with the Securities Act of 1933, as Amended, and the applicable rules and regulations thereto; * * *.' (Exhibit A to Plaintiff's Complaint, p. 3)
While this agreement was in effect, Catlin gave notice of his desire to exercise his option. The Corporation declined to deliver the stock unless Catlin would accept such stock with the following legend appearing thereon:
'These shares have been issued on the condition that they will be held for investment purposes only and not for distribution.'
Catlin filed suit alleging that he was entitled to receive the usual shares of the common stock of the company without any notations thereon and prayed for a decree requiring the Corporation to deliver the shares according to his interpretation of the contract. He testified that he was prepared to pay the purchase price and take the shares and that he would not dispose of the stock other than in compliance with the Securities Act of 1933. After trial the court entered a decree requiring delivery of the stock without the restrictive legend.
In accordance with this decree, the defendant-corporation tendered to the plaintiff the unrestricted shares of stock together with a letter stating that the stock was being delivered to avoid contempt of court proceedings under the express condition that such delivery was without prejudice to defendant's appeal in the cause. Attached to the letter was a certified copy of both the notice of appeal and assignment of error. This tender of the stock was refused by Catlin.
The appellant, General Development Corporation, contends that the failure of the court below to require that the restriction be placed on the certificate in effect nullifies it, because of the requirement of § 614.17, Fla.Stat., F.S.A. This statute provides as follows:
'614.17. No lien or restriction unless indicated on certificate.
'There shall be no lien in favor of a corporation upon the shares represented by a certificate issued by such corporation and there shall be no restriction upon the transfer of shares so represented by virtue of any by-lwas of such corporation, or otherwise, unless the right of the corporation to such lien or the restriction is stated upon the certificate.' 1
As its reason for insisting upon a restricted certificate, appellant contends that it is not protected against a transfer of the stock in violation of the decree, and if Catlin were to transfer the stock to a purchaser without notice of the restriction, the purchaser would take the stock free and clear regardless of the decree.
Without deciding whether this fear of the Corporation is well grounded in fact, we must admit that it has a basis in law. In Haas v. Haas, 35 Del.Ch. 392, 119 A.2d 358 (1955), a restraining order against transfer had been granted in Delaware against the holder of stock and the corporation which issued the stock. The holder thereafter transferred the stock in Florida. The Delaware court, interpreting the same provision of the Uniform Stock Transfer Act, held that since the court order was not noted on the certificate in accordance with the statute, a purchaser without notice would take the stock free and clear. See also DeLeon, Corporations: Restraint on Alienation of Stock Certificates, 8 U.Fla.L.Rev. 321 (1955); Edge and Peeples Stock Transfer Restrictions in Closely Held Corporations, 10 U.Fla.L.Rev. 54 (1957).
Appellee, Catlin, points out that it would have been a simple matter for General Development Corporation to provide in the contract for the delivery of a restricted stock certificate, but instead it accepted his express personal covenant to the exclusion of the statutory provision. Catlin gives as his reason for refusing to accept the restricted...
To continue reading
Request your trial-
Bassett v. Bassett
...684 (Fla.1954); Southern Crane Rentals, Inc. v. City of Gainesville, 429 So.2d 771 (Fla. 1st DCA 1983); General Development Corporation v. Catlin, 139 So.2d 901 (Fla. 3d DCA 1962); Coast Cities Coaches, Inc. v. Whyte, 102 So.2d 848 (Fla. 3d DCA 1958).2 "In the event that such income shall i......
-
National Merchandise Co., Inc. v. United Service Auto. Ass'n
...the making of a contract forms a part of that contract, as if it were expressly referred to in its terms. General Development Corp. v. Catlin, 139 So.2d 901, 903 (Fla. 3rd DCA 1962). We conclude, based upon the foregoing analysis, that the term "auto accident," as used in U.S.A.A.'s policy,......
-
Ohmes v. Ohmes
...In haec verba. Schekter v. Michael, Fla.1966, 184 So.2d 641; Proser v. Berger, Fla.App.1961, 132 So.2d 439; General Development Corp. v. Catlin, Fla.App.1962, 139 So.2d 901; Lynch-Davidson Motors v. Griffin, Fla.1965, 182 So.2d 7. Therefore, the terms and provisions of Sec. 65.15 were a com......
-
Florida East Coast Ry. Co. v. CSX Transp., Inc.
...legal operation controlled or affected the obligations of the contract.") (emphasis omitted) (quoting General Dev. Corp. v. Catlin, 139 So.2d 901, 903 (Fla.Dist.Ct.App.1962)). And a subsequent change in the law cannot retrospectively alter the parties' agreement. Florida Beverage Corp., 503......
-
Successfully defending employees in noncompete and trade secret litigation.
...200318.htm (17) Shavers v. Dural County, 73 So. 2d 684 (Fla. 1954); General Development Corporation v. Catlin, 139 So. 2d 901 (Fla. 3d D.C.A. 1962); Florida Beverage Corporation v. Division of Alcohol Beverages and Tobacco, Department of Business, 503 So. 2d 396 (Fla 1st D.C.A. 1987); Rolan......