Gulf Cities Gas Corp. v. Tangelo Park Service Co., 70-1078
| Decision Date | 27 October 1971 |
| Docket Number | No. 70-1078,70-1078 |
| Citation | 253 So.2d 744 |
| Parties | GULF CITIES GAS CORPORATION, Appellant, v. TANGELO PARK SERVICE COMPANY, a corporation, and Florida Gas Company, a corporation, Appellees. |
| Court | Florida District Court of Appeals |
Ernest R. Drosdick, of Lowndes, Peirsol, Drosdick, Baker & Doster, Orlando, for appellant.
Fredric M. Hitt, of Bowden, Hitt & Hurt, Orlando, for appellee, Tangelo Park Service Co.
This is an appeal from a final judgment of the Circuit Court for Orange County, Florida. Broadly stated, the issue on this appeal is whether or not the trial court's final judgment correctly applied the terms of a written contract between the plaintiff, Tangelo Park Service Company, and the defendant Fuel Gas Corporation (hereafter called 'Fuel Gas').
The plaintiff, Tangelo Park Service Company, filed an amended complaint on 11 October 1968 which alleged that the defendants Fuel Gas and Gulf Cities Gas Corporation (hereafter called 'Gulf Cities') breached the contract with plaintiff by failing to pay the plaintiff ten percent of all monies collected for gas sold by said defendants in Tangelo Park, a subdivision in Orange County, Florida, from 1 May 1966. The complaint was later amended to add Florida Gas Company (hereafter called 'Florida Gas') as a party defendant based on the allegation that Florida Gas assumed the obligations of the contract. The relief sought was an accounting and a judgment for the asserted indebtedness. The cause was tried without a jury.
In essence the contract purported to give the defendant Fuel Gas the exclusive right to sell gas to residents of Tangelo Park Subdivision for cooking and heating. In return Fuel Gas was obligated to pay Tangelo Park Service Company ten percent of all revenues collected by it arising from such sales. For our purposes the critical provisions of the contract state:
'12:--(a) SUPPLIER WILL pay to TANGELO PARK SERVICE COMPANY not later than fifteen days following the end of each calendar quarter (payment dates--April 15, July 15, October 15, and January 15), an amount equal to ten per cent (10%) Of the gross amount received by SUPPLIER, through the sale of gas, from consumers within the Subdivision using the service provided by SUPPLIER.' (Emphasis added.)
The defendant Gulf Cities was not a signatory to the contract.
The final judgment recites that the trial court found for the defendants Florida Gas and Fuel Gas on the plaintiff's claim against them, but found for the plaintiff against defendant Gulf Cities on the plaintiff's claim against it. The court further found that the contract terminated on 27 September 1970. The court held: (1) that the plaintiff recover from defendant Gulf Cities $27,704.52 plus interest in the amount of $3,386.36, and (2) that defendant Gulf Cities And Florida Gas account to plaintiff for all monies collected by either defendant from gas sales in Tangelo Park Subdivision through 27 September 1970 and pay over to plaintiff an amount equal to ten percent of the gross income from such sales.
The defendant Gulf Cities filed this appeal and assigned as error the entry of the final judgment and particularly the finding that the contract was terminated on 27 September 1970. The plaintiff, Tangelo Park Service Company, cross-assigned the same finding and also assigned as error the failure of the trial court to order the defendants to perform the payment obligations of the contract 'so long as gas is sold in Tangelo Park Subdivision.'
The plaintiff, Tangelo Park Service Company, associated with two other corporations in connection with the development of the Tangelo Park Subdivision. The other two corporations were Cross-State Land Company and Cross-State Construction Company. Al Feldman, who appeared as a witness on behalf of the plaintiff, was president of all three of these companies in 1858 when the significant events occurred.
Tangelo Park Service Company was formed for the purpose of providing sewer and gas facilities for the subdivision, but never owned any of the real property in the subdivision. Cross-State Land Company owned the land and transferred the lots to Cross-State Construction for the construction of houses.
Thomas Donovan was vice-president of Cross-State Land, Cross-State Construction, and Tangelo Park Service Company in 1958. The negotiations which gave rise to the contract were initiated by one Archie Deserable in 1958. According to Donovan, Deserable told him that he represented the appellant Gulf Cities. Donovan told Deserable that he (Donovan) wanted, '* * * a contract that would last forever'; a contract for, '* * * as long as gas was being served * * * in Tangelo Park'; and, a 'lifetime contract.' Deserable, according to Donovan, agreed to this concept. Donovan said that after several meetings with Deserable, the conclusion of the negotiations was left to Al Feldman who is presently the vice-president of plaintiff.
Al Feldman testified that he negotiated the terms of the contract with the principals of defendants Gulf Cities and Fuel Gas. He said that some negotiations were held with a Mr. Birnbaum who represented himself as negotiating for Gulf Cities. Birnbaum, according to Feldman, stated that Fuel Gas was the parent of Gulf Cities, and for image purposes the contract would be in the name of Fuel Gas. With respect to the duration of the contract, Feldman testified, 'I think the contract speaks for itself, it was a--forever.'
With respect to the performance of the contract, Archie Deserable testified that Gulf Cities--not Fuel Gas--laid the mains, installed the distribution system and paid for it. He said the lines were placed in roadways and easements before houses were sold. Gas service started to the customers in the subdivision in the latter part of 1958, according to Deserable. The gas was piped through the system from a bulk storage plant on lots bought by Gulf Cities from the plaintiff.
At the time the contract was in negotiation, the Cross-State companies were negotiating restrictions with FHA relative to the subdivision. The subdivision restrictions were imposed by Cross-State Land and later Cross-State Construction Company. The first section was restricted on 21 November 1958. Subsequent restrictions were recorded on 31 March 1958 (Section Two); 5 October 1959 (Section Three); 19 February 1960 (Section Four); and 27 September 1960 (Section Five). Each of the restrictions contained a clause to the effect that any gas purchased for use in the homes would be purchased from the subdivider or its successors or assigns for a period of ten years.
A contract dated 19 February 1969 was entered into between the defendant Gulf Cities and the defendant Florida Gas for the sale to Florida Gas of all of Gulf Cities' tangible assets in Tangelo Park as well as whatever easements or property rights it had in the subdivision.
The trial judge sitting without a jury was presented with two basic issues. The first was whether or not the defendant Gulf Cities was liable on the contract between Fuel Gas and the plaintiff, Tangelo Park Service Company, even though Gulf Cities was not a formal party to the contract. The second issue was the extent or measure of that liability, if any. The trial judge held that the defendant Gulf Cities was liable as a party to the contract and ordered it to pay the plaintiff ten percent of all...
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