Mills Development Corp. v. Shipp & Head, Inc.

• Decision Date: 11 December 1936
• Parties: MILLS DEVELOPMENT CORPORATION v. SHIPP & HEAD, Inc.
• Court: Florida Supreme Court

171 So. 533

126 Fla. 490

MILLS DEVELOPMENT CORPORATION v. SHIPP & HEAD, Inc.

Florida Supreme Court, Division A.

December 11, 1936

Rehearing Denied Jan. 12, 1937.

Suit by Shipp & Head, Incorporated, a Florida corporation, against Mills Development Corporation and others. From interlocutory orders denying a motion to dismiss the bill of complaint and refusing to vacate or discharge a notice of lis pendens, the named defendant appeals.

Affirmed. Appeal from Circuit Court, Dade County; H. F Atkinson, judge.

COUNSEL

Shutts & Bowen, Crate D. Bowen, and Charles A. Carroll, all of Miami, for appellant.

W. H Burwell and Shipp, Evans & Kline, all of Miami, for appellee.

OPINION

DAVIS Justice.

This appeal is to review two interlocutory orders denying a motion to dismiss a bill of complaint and refusing to vacate or discharge a notice of lis pendens filed in connection with same.

The plaintiffs' bill, summarized in its perspicuous significance, alleges that plaintiffs, as brokers, entered into negotiations with the individual defendants for the purchase of 260 vacant lots of a subdivision with the object in view of forming a corporation to be made up of themselves as stockholders, to acquire, improve, and resell the lots at a profit to the promoters; that in the formation of the corporation the plaintiffs were to be issued 49 per cent. of the stock to represent their service interest in the joint adventure of acquiring, improving, and selling the lands involved, whereas defendants were to own 51 per cent. of the stock as representative of their capital interest in the undertaking; that the corporation as agreed was ultimately formed, the lands acquired, and the venture embarked upon, but that notwithstanding the contractual engagement entered into between the promoters in the first instance, to the effect that the plaintiffs were to be employed by the resultant corporation to assist in the development of the subdivision and were to hold 49 per cent of the corporate stock, that defendants Frederick Mills, Herbert Mills, Hayden Mills, and Ralph Mills (designated hereafter as Mills Brothers) after so forming the intended corporation under the laws of Florida and designating it as Mills Development Corporation (named in the suit as condefendant with said Mills Brothers), in which they had issued to themselves 51 per cent. of the stock, thereupon proceeded to deny to plaintiffs their 49 per cent. interest in the stock of the corporation and had, on the contrary, so assumed control over, mismanaged, and fraudulently conducted the affairs of the corporation over which they became the dominant directorate, as to deprive plaintiffs of their beneficial equitable interest in the joint business venture intended to be consummated by the corporation pursuant to the contract of the parties, and that thereby plaintiffs were being deprived of their equitable rights in the carrying out of the initial enterprise of acquiring, developing, and reselling at a profit the lots in controversy, the title to which had become vested in the defendant corporation only as a means toward the end of carrying out the original plan agreed upon in advance of the corporation's formation, and of which the formation of the corporation itself was a mere step toward the ultimate and comprehended in the initial engagement between plaintiffs and the individual defendants.

According to the allegations of the bill, the corporation now holds lands and assets which were acquired by it solely as the result of a preliminary joint adventure entered upon by those who agreed to create such a corporation simply as part of the larger scheme; the scheme itself being intended to be merged...