Gordon Finance, Inc. v. Belzaguy, 68--438

• Decision Date: 03 December 1968
• Docket Number: No. 68--438,68--438
• Citation: 216 So.2d 240
• Parties: GORDON FINANCE, INC., a Florida corporation, Gordon Matusofsky Independent Finance Corporation, a Florida corporation, and Leon Hoffman, Appellants, v. Juan Ernesto BELZAGUY and Jorge Luis Montadas, Appellees.
• Court: Florida District Court of Appeals

Page 240

216 So.2d 240

GORDON FINANCE, INC., a Florida corporation, Gordon Matusofsky Independent Finance Corporation, a Florida corporation, and Leon Hoffman, Appellants, v. Juan Ernesto BELZAGUY and Jorge Luis Montadas, Appellees.

No. 68--438.

District Court of Appeal of Florida, Third District.

Dec. 3, 1968.

Rehearing Denied Dec. 18, 1968.

Pallot, Silver, Pallot, Stern & Proby, Miami, for appellants.

Harris J. Buchbinder, Miami Beach, for appellees.

Before PEARSON, BARKDULL and SWANN, JJ.

PEARSON, Judge.

This interlocutory appeal is brought by the defendants in the trial court. It seeks reversal of an order which, among other things, denied their motion to dismiss the appellees' complaint, the key portions of which are:

'1. This action is filed pursuant to rules of Civil Procedure 1.220, as being an action involving a question of common and general interest to many persons constituting a class so numerous as to make it impractical to bring them all before this Court.

'2. The individual Defendants are residents of Dade County and sui juris. The corporate defendants are Florida corporations engaged in the insurance premium finance business, with a principal place of business, with a principal place of business in Dade County, Florida.

'3. In or about February, 1968, the defendants have commenced a course of conduct designated to cause great hardship and chaos to many residents of Dade County and the State of Florida and which may result in a multiplicity of actions throughout said County and State.

'4. Defendants have and are continuing to send to insurance companies operating in the State of Florida Notice of Cancellations wherein said Notice reflects that either GORDON FINANCE, INC., or INDEPENDENT FINANCE CORPORATION have or had a premium finance agreement with the named insureds set forth in said Notice of Cancellation, and that said insureds were in default under the terms of the premium finance agreement and that by reason thereof said policies should be cancelled, and any return premiums be forwarded to the defendants.

'5. That in truth and fact there did not exist any premium finance agreement between the insureds and the defendants and that therefore, the insureds were not and could not be in default as set forth in Notices of Cancellation.

'6. That unless this Court enters an Order enjoining the defendants from issuing Notice of Cancellation of policies to such insurance companies, the plaintiffs will be irreparably injured and that said plaintiffs are without an adequate remedy at law.'

The appellants filed a motion to dismiss the complaint. The two grounds of that motion pertinent to this appeal are:

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'2. That the complaint fails to allege any act or activity by the individual defendants GORDON MATUSOFSKY and LEON HOFFMAN, but instead refers only to notice of cancellations issued by the corporate defendants, GORDON FINANCE, INC. and INDEPENDENT FINANCE CORPORATION.'

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'5. That the complaint fails to allege any facts which show that the suit may be the subject matter of a class action, and should therefore be limited only to any relief which the individual plaintiffs may claim against the defendants.'

Thereafter the court entered the order appealed from, which contains the following findings:

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'1. That there are at least four groups of individuals or corporate entities involved in the problems presented to this Court through the testimony, evidence and stipulations, to-wit:

a) That segment of the insurance buying public which have in the past, or will in the future, purchase insurance through DADE NATIONAL INSURANCE AGENCY; b) various insurance premium finance companies and banks which have financed insurance premiums on polices of insurance sold by DADE NATIONAL INSURANCE AGENCY, including the defendants GORDON FINANCE, INC., and INDEPENDENT FINANCE CORPORATION, as well as one or more banks which appear to have made unsecured loans to customers of DADE NATIONAL INSURANCE AGENCY in connection with policies of insurance being purchased by said customers; c) DADE NATIONAL INSURANCE AGENCY CORP., the owner of DADE NATIONAL INSURANCE AGENCY, and TERRA MANAGEMENT CORP.; d) and the insurance companies that have issued, or will in the future issue, policies of insurance to customers of DADE NATIONAL INSURANCE AGENCY. All of these groups will be affected by the interlocutory orders and final decision of this Court in this case, and the COURT, by the entry of this order is attempting to protect the respective rights of each of the said interested groups.

'2. That many hundreds of insurance premium finance contracts negotiated by DADE NATIONAL INSURANCE AGENCY CORP. to GORDON FINANCE, INC. and INDEPENDENT FINANCE CORPORATION, for value, have been questioned by the plaintiffs on the grounds that they are either forgeries or the subject of double financing by DADE NATIONAL INSURANCE AGENCY CORP. The defendants, in their petition for appointment of receiver, similarly indicate that they believe that some of the contracts negotiated to them by DADE NATIONAL INSURANCE AGENCY CORP. bear forged signatures.

'3. That the term 'double financing' as used above contemplates a situation whereby a customer of DADE NATIONAL INSURANCE AGENCY CORP. would purchase a policy of insurance and simultaneously execute a premium finance contract as part of the insurance application papers. Then the customer would either pay the full insurance premium in cash, or would be sent to a bank to make an unsecured loan in the amount required to pay such portion of the insurance premium as the customer did not have at the time of the transaction. DADE NATIONAL INSURANCE AGENCY CORP. would then negotiate the said insurance premium finance contract, for value, to one or more premium finance companies, including GORDON FINANCE, INC. and INDEPENDENT FINANCE CORPORATION. The net result of double financing is that DADE NATIONAL INSURANCE AGENCY CORP. was paid twice for the same insurance premium.

'4. That some of the customers of DADE NATIONAL INSURANCE AGENCY CORP. involved in the double financing were of Cuban extraction or birth, and were primarily literate in the Spanish language.

'5. That DADE NATIONAL INSURANCE AGENCY CORP. is clearly the principal culprit in the doublt financing transactions, and its president, managing officer and sole stockholder throughout the period of double financing transactions was MANUEL RICO, who apparently is now residing in Spain.

'6. That as a result of the double financing and/or forging of signatures by DADE NATIONAL INSURANCE AGENCY CORP., it appears that many innocent persons who purchased insurance and paid DADE NATIONAL INSURANCE AGENCY CORP. in full in case, the exact number being unknown to the Court, have had their insurance coverage cancelled by GORDON FINANCE, INC. and INDEPENDENT FINANCE CORPORATION when the said premium finance contracts went into default for non-payment of the installments provided for therein.

'7. The Court is deeply concerned with possible further adverse effects on both past and future customers of DADE NATIONAL INSURANCE AGENCY.

'8. That TERRA MANAGEMENT CORP., by a transaction not yet disclosed to the Court may have succeeded to the ownership of the insurance agency business previously owned by DADE NATIONAL INSURANCE AGENCY CORP., and the said TERRA MANAGEMENT CORP. may be presently conducting the insurance agency business previously conducted by DADE NATIONAL INSURANCE AGENCY CORP., at the same address, 2020 S.W. First Street, Miami, Florida. That the Court specifically reserves jurisdiction on all issues pertaining to the transfer of assets, if any, from DADE NATIONAL INSURANCE AGENCY CORP. until subsequent hearing before this Court.

'9. That during the months preceding February, 1968,...