Mcgregor v. Provident Trust Co. of Philadelphia

• Decision Date: 15 January 1935
• Citation: 162 So. 323,119 Fla. 718
• Court: Florida Supreme Court
• Parties: McGREGOR v. PROVIDENT TRUST CO. OF PHILADELPHIA.

162 So. 323

119 Fla. 718

McGREGOR v. PROVIDENT TRUST CO. OF PHILADELPHIA.

Florida Supreme Court

January 15, 1935

Adhered to on Rehearing June 27, 1935.

Proceeding by L. D. McGregor, as receiver of the Tampa Water Works Company, against the Provident Trust Company of Philadelphia surviving trustee under the will of Stuart Wood, deceased and/or executor under the will of or on behalf of Edward R Wood, Jr., deceased, remaining executor under the will of said Stuart Wood, deceased. From the decree, L. D. McGregor as receiver of the Tampa Water Works Company, appeals.

Affirmed. Appeal from Circuit Court, Hillsborough County; L. L. Parks, judge.

COUNSEL

Carl G. Kirsch, of Philadelphia, Pa., and Mabry, Reaves, Carlton & White, of Tampa, for appellant.

Knight, Thompson & Turner, of Tampa, for appellee.

OPINION

DAVIS Justice.

This is an appeal from a decree in equity disallowing a contested receiver's claim interposed in the court below by the appellant receiver and adjudicating in connection therewith that the estate of Stuart Wood was entitled to share in the distribution of the assets of the Tampa Water Works Company in the same proportion as other stockholders, and in proportion to the admitted stock ownership of the Stuart Wood estate, notwithstanding the claim of the receiver that Stuart Wood's estate, by reason of Stuart Wood's having withheld certain assets of the Tampa Water Works Company from that corporation during his lifetime, was under an obligation to account to the receiver for the value thereof, in order that same might be set off as a charge against Stuart Wood's admitted stock ownership in the Tampa Water Works Company at the time of his death.

The present appeal is the fourth appearance of some phase of this litigation before this court. For our previous opinions dealing with it see Tampa Water Works Co. v. Wood, 104 Fla. 306, 139 So. 800; Wood v. Provident Trust Co., 113 Fla. 260, 152 So. 186; Wood v. Provident Trust Co., 115 Fla. ----, 152 So. 856. Therefore a brief history of the controversy is in order.

In June, 1927, Walter Wood, as a minority stockholder in the Tampa Water Works Company, filed a bill in equity against it in which he alleged that the company had been for years the owner of the waterworks which supplied the city of Tampa, but that in 1923 the waterworks were purchased by the city of Tampa. He alleged that Stuart Wood had, prior to his death, been president of, the largest stockholder of, and in complete management and control of, the Tampa Water Works Company; that the company was under the 'complete domination and control' of the legal representatives of the estate of Stuart Wood; that there had been certain allegedly wrongful stock transfers, and that certain lands held in trust for the company by Stuart Wood were being sold and the proceeds wrongfully appropriated to the estate of Stuart Wood by its legal representatives, to the detriment of the corporation; that the affairs of the company were being wastefully and extravagantly mismanaged, and that the executors were neglecting without reason to wind up its affairs and distribute its assets.

A demurrer to the bill was overruled, and the order overruling it was sustained on appeal. Tampa Water Works Co. v. Wood, 97 Fla. 493, 121 So. 789. The defendant thereupon filed an answer denying the allegations of the bill, testimony was taken, and the chancellor rendered a final decree appointing a permanent receiver for the purpose of winding up the company and distributing its assets.

In the last-mentioned decree the receiver was expressly authorized to institute such legal proceedings as might be necessary to recover for the corporation such sums as might be found to be justly due it by the estate of Stuart Wood. On appeal, the chancellor's decree in that particular was affirmed. Tampa Water Works Co. v. Wood, 104 Fla. 306, 139 So. 800.

Thereafter, in pursuance to a notice published by the receiver requiring all creditors, stockholders, and other claimants to file their claims by a given date, the Provident Trust Company, as the representative of the Stuart Wood estate, filed a claim as the owner of 2,395 shares of stock, and asked the right to receive distribution accordingly. The receiver filed a contest of its claim on the ground that the matters and things set forth in the bill of complaint were true, and that by reason thereof the representatives of the estate of Stuart Wood had obtained money and property of the Tampa Water Works Company 'of the amount and value of $281,112.00,' and asked that the claim of the estate for a distributive share be disallowed and that the receiver be authorized to pass credit to the estate therefor against the larger amount which the estate owed the Tampa Water Works Company.

Judge Robles, the circuit judge, who had rendered the previous decrees, having died, the contest came on for further hearing before Judge Parks of the same court. His decree refusing to entertain it on the ground of lack of jurisdiction in himself to determine the questions raised therein was reversed on appeal. Wood v. Provident Trust Co., 113 Fla. 260, 152 So. 186.

In the meantime, counsel for the receiver and for the estate of Stuart Wood had entered into a stipulation that all questions involved here should be tried and determined upon the evidence presented in the case of Walter Wood against the Tampa Water Works Company and upon the pleadings in that case in so far as they might be pertinent and the pleadings filed by the parties hereto. Judge Parks proceeded then to render a decree on the merits of the receiver's contest in which he held that the lands involved were held individually by Stuart Wood, and consequently so by his estate, and not in trust for the Tampa Water Works Company, and that the contest of the receiver adverse to the claim of the estate of Stuart Wood for a distributive share should therefore be denied. The receiver appealed from that decree, and it is with that appeal that we are here concerned on the present appeal.

The first question raised on this appeal is whether or not Judge Robles, in his earlier decree appointing the receiver, had settled the question of whether or not the disputed lands acquired by Stuart Wood were held in trust for the Tampa Water Works Company, or individually by the estate of Stuart Wood, and, such being so, whether or not Judge Parks' decree is erroneous by virtue of his having attempted to adjudicate a question at the time already settled by an earlier decree that had been affirmed by the Supreme Court.

By his decree of October 23, 1930 (which this court has affirmed as hereinbefore stated), Judge F. M. Robles, who had heard the evidence consisting of some 800 pages up until that time, recited that the court, having considered the evidence and heard arguments of counsel for the respective parties, thereupon found, ordered, adjudged, and decreed as follows: (1) That it was the duty of the court to take charge of the affairs of the Tampa Water Works Company, the defendant, for the purpose of winding up the same and equitably distributing the assets of the company amongst its stockholders according to their just rights; (2) that to discharge such duty it was necessary for the court to appoint a receiver with authority to employ counsel and order him to institute such legal proceedings in such jurisdiction or jurisdictions as might be found necessary to accomplish an accounting between the representatives of the estate of Stuart Wood and the Tampa Water Works Company, and to recover for the corporation such sums as might be found to be justly due it by the estate of the said Stuart Wood and the representatives of said estate; (3) that further and supplemental proceedings might be had in the pending cause, or other suits instituted in this jurisdiction to accomplish the ends of the decree then being entered, if found necessary or proper; (4) that the court would reserve its jurisdiction of the pending cause and its power to permit and direct such further proceedings, supplemental and amendatory, as might appear necessary or expedient to accomplish the purposes of the court's decree.

So it is of prime importance to the decision of the present case for this court to ascertain from Judge Robles' decree of October 23, 1930, whether or not the decree amounted to an adjudication or determination by the chancellor of the strenuously contested issue whether or not Stuart Wood held certain disputed lands involved in the complainant's claim against him in the capacity of a trustee for said Tampa Water Works Company, or in the his personal capacity as his own individual property.

Counsel for appellant argues with conviction that in Walter Wood's suit against the Tampa Water Works Company he charged three things: (1) That 203 shares of the stock held by the Stuart Wood estate really belonged to the corporation; (2) that the winding up of and the distribution of the assets of the corporation was being needlessly delayed and exorbitant salaries were being paid its officers; and (3) that the lands held by Stuart Wood and now by his estate in reality belonged to the corporation.

He says that, as opposing counsel concede, there was no attempt on the part of complainant to prove the first, that the proof as to the second also failed (as opposing counsel likewise concede), and that therefore Judge Robles in making his final decree appointing a permanent receiver must have grounded it on the third. He argues that this must be so because the chief issue in the case prior to Judge Robles' decree was whether or not the corporation was being defrauded of moneys by the Stuart Wood estate, and points to the language of Judge Robles' order in which he appoints a permanent...