Glynn v. Roberson

• Decision Date: 22 April 1952
• Citation: 58 So.2d 676
• Parties: GLYNN et ux. v. ROBERSON et al.
• Court: Florida Supreme Court

Page 676

58 So.2d 676

GLYNN et ux. v. ROBERSON et al.

Supreme Court of Florida, Special Division A.

April 22, 1952.

Pallot, Silver, & Mulloy, Miami, T. T. Turnbull and Turnbull & Pepper, all of Tallahassee, for appellant.

Charles Girtman and Joseph A. Hackney, Miami, for Mary Freeman Roberson and Jerome Weinkle, Miami, for Thomas Estes Roberson, Jr., appellees.

MURPHREE, Associate Justice.

This is an appeal from a final decree entered in a suit by the lessors to cancel a lease and for a declaration of the rights of the parties to the fund deposited by the lessee. The questions for decision are:

1. Did the Chancellor err in refusing to cancel the lease?

2. If so, was the 'security deposit' of $32,000 held by the lessors liquidated damages or a penalty?

3. Should costs and expenses of the suit have been assessed equally between the parties?

J. G. Glynn and wife, appellants, leased a retail liquor store and bar for ten years to Thomas Estes Roberson, Jr., one of the appellees, in July, 1948, at an annual rental of $4,000, plus 25% of the net profits in excess of $15,200 per annum.

Roberson was required to deposit the sum of $36,000 to be returned at the rate of $4000.00 per annum over the period of the lease. In that connection the lease provided:

'* * * the said sum is and shall be security for the performance by the Lessee of all the terms, conditions and agreements in this lease contained by the Lessee to be kept and performed; and shall stand as security also for the protection of the liquor licenses which the Lessor is transferring to the Lessee to be used by the Lessee for the period of this lease, it being understood that the value of the liquor licenses is one of the major considerations for the amount of the rent being paid hereunder and it being further understood that the Lessor, in order to be fully protected, especially insofar as the liquor licenses are concerned, must have the amount of security provided for herein * * *. If the lease is cancelled for the default of the Lessee, no part of the fund shall be returned to the Lessee * * * and the Lessor, on its part, may either retain the fund as liquidated damages, or may apply it as against the actual damage by reason of the Lessee's default in the lease * * *.'

The lessee also covenanted on his part substantially as follows: (1) Pay rent promptly; (2) Pay for utilities promptly; (3) Account for excess profits as agreed; (4) Keep liquor license in force and return same to lessors upon expiration or cancellation lf lease; (5) Keep premises in repair and commit no waste; (6) Conduct business during normal business hours, holidays excepted; (7) Not sell lease until after July, 1950, and then only by consent of the lessors, who were to share in any profit from the transaction; (8) Pay costs and attorney's fee in event of eviction or suit to cancel lease by lessors.

After the lease was entered into Roberson and his wife, Mary Freeman Roberson, the main appellee, had marital difficulties and they were divorced on January 6, 1950. Under the divorce decree Mrs. Roberson was awarded the business because she had supplied the money for her husband to acquire the lease. She took possession on February 3, 1950, and ran the business, after a fashion, until a receiver was appointed on March 6, 1950, upon institution of the suit below.

By their bill of complaint the Glynns alleged that Mrs. Roberson had violated the lease by permitting gambling on the premises in the form of bookmaking, thus placing in jeopardy the liquor license, and that she was not a fit person to operate the business because of her lack of business acumen and habitual intemperance, so they feared that if the business remained in her hands profits and rents anticipated would be lost and the business eventually destroyed through cancellation of the liquor license. They prayed for a receiver, for cancellation of the lease, and for declaration of the rights of the parties under the terms of the lease. The answer amounted to a denial of the allegations of the Bill.

After hearing the evidence the Chancellor by his final decree entered on April 6, 1951, found: (1) that bookmaking was being conducted on the premises by an employee of Mrs. Roberson and by those unlawful acts the liquor license was in jeopardy; (2) that Mrs. Roberson failed to keep the business open during normal business hours as required by the lease, which caused a loss of profits to the business; (3) that Mrs. Roberson '* * * by her own admission knew nothing and cared little about the operation of the business * * *.' and she was '* * * a woman utterly unfit and incapable of managing this property'; (4) that '* * * to award plaintiff the thirty-two thousand dollars ($32,000) security would be a grave injustice to the defendant, Mary Freeman Roberson, as this court is not convinced that the damages suffered by the plaintiff amounts to such a huge sum, if any damages have accrued to him at all * * *'; (5) that the solution to the problem lay in allowing Mrs. Roberson to continue as lessee to operate the business under a '* * * management agreement for a person well versed in handling of businesses of this type * * *', which agreement was exhibited to the court.

The Chancellor then decreed: (1) that Mrs. Roberson should continue as lessee, the $32,000 remaining in the security fund to be returned to her according to the terms of the lease; (2) that the receivership be terminated; and (3) that the costs of the suit including the expense of the receivership in the total amount of $1750 be taxed equally between both parties.

Twelve days later on petition for rehearing, it being shown that the manager selected by Mrs. Roberson and approved by the court was unfit by virtue of having a criminal record, the Chancellor withdrew his approval of that...