Platt v. Mannheimer
| Decision Date | 17 November 1960 |
| Docket Number | No. 59-726,59-726 |
| Citation | 124 So.2d 503 |
| Parties | Louis PLATT, Appellant, v. Milton MANNHEIMER, as Trustee, Appellee. |
| Court | Florida District Court of Appeals |
Ward & Ward, Miami, for appellant.
Harold B. Spaet and Harvey Reiseman, Miami Beach, for appellee.
This is a Dade County lease controversy involving the following factual background:
Appellant, lessee, and appellee, lessor, are assignees of a 99 year lease of certain Miami Beach property on which there is now located a hotel but was vacant at the time of the execution of the lease. By the terms of the lease dated April 10, 1951, the lessee agreed to construct a hotel and furnish same, pay rent, taxes, mortgage payment and insurance and do all other things that a lessee agrees to do in a typical 35 page Miami Beach hotel lease but which are of no consequence to his appeal. The hotel was constructed and furnished for an amount in excess of $750,000.
The appellant failed to pay the rent due March 15, 1959, of $13,000 and taxes for 1958 amounting to $26,755.21. The appellee gave appellant notice of default of the lease and instituted dispossessory proceedings. Appellant was dispossessed in April of 1959.
Appellee then filed this action alleging that appellant was indebted to the appellee for the said past-due rent, taxes for 1958 and for insurance that was cancelled by appellant. Appellant answered that the lease provided for a security deposit and that in case of default and termination, the security deposit (hotel and furnishings) were to be liquidated damages for that default.
The cause came before the trial coaurt on appellee's motion for summary judgment. The trial court found for appellee and entered summary judgment for appellee in the sum of $43,075.06 which included said rent and taxes plus $3,319.85 for the cancelled insurance policies.
It is from that judgment that this appeal is taken.
The question to be decided by this appeal can be stated as follows:
Where a lease provides that the premises built upon lessor's land by the lessee plus the personal property located therein shall, in the event of termination of the lease because of lessee's default, pass to and become the property of the lessor, not as penalty or forfeiture but as liquidated damages, is the lessor, upon default by the lessee, entitled to recover for rent, taxes and insurance due at the time of the default or is lessor's recovery limited to the liquidated damage provision of the lease?
It may be well to say at the outset that this case does not present the problem of determining if the liquidated damage provision in the lease is to be construed as a penalty or liquidated damages. Appellant and appellee both agree that the provision is one of liquidated damages and not penalty.
The provision of this lease that has given rise to this controversy provides as follows:
'G) It is further covenanted and agreed by and between the parties hereto, in the event of the termination of this lease at any time before the expiration of the term of ninety-nine (99) years hereby created for the breach of any of the covenants herein contained, then in such case all of the right, estate and interest of the Lessee in and under this indenture and in the demised premises hereinabove described and all improvements, buildings and the Lessee's interest in all furniture, furnishings, fixtures and equipment then situate in said demised premises, together with all rents, issues and profits of said premises and the improvements thereon, whether then accrued or to accrue and all insurance policies and all insurance moneys paid or payable thereunder shall, without any compensation made therefor unto the Lessee, at once pass to and become the property of the Lessors, not as a penalty for forfeiture but as liquidated damages to the Lessors because of such default by the Lessee hereby fixed and agreed upon between the parties hereto, each of the parties hereto recognizing the impossibility of precisely ascertaining the amount of damages that will be sustained by the Lessors in consequence of such default and the parties desiring to obviate any question or dispute concerning the amount of such damages and the cost and effect of such default in consequence of such forfeiture, have taken these elements into consideration in fixing and agreeing upon the amount of rent to be paid by the Lessee to the Lessors.'
No case among the decisions of the appellate courts of the State of Florida where the question stated above has been both raised and decided has been presented by counsel nor have I found such a case.
In Kanter v. Safran, Fla.1953, 68 So.2d 553, 559, the Supreme Court of Florida used the following language:
This principle of law is dictum to the point involved in that case as will be shown by an examination of the case.
The factual situation in the Kanter case is similar to the one now being decided but the question decided by the Supreme Court is different. The facts of the Kanter case are as follows: The parties entered into a lease of a Miami Beach hotel, the lessee making a security deposit of $33,000 equalling one year's rental. The lessee failed to make three monthly rental payments and lessor brought a suit at law to collect the past-due rent. The lessor took possession of the premises specifying that said possession was taken for the account of the lessee. Three weeks later lessee sued in equity for the return of the security deposit less past-due rent and an injunction against the action at law for past-due rent. Lessor answered claiming the security deposit as liquidated damages and counterclaimed for special damages. The trial court decreed the security deposit be returned less past-due rent and other special damages. The Supreme Court reversed the lower court holding that the question presented as follows:
'We think the key question in the case is whether there was a surrender by the lessees and an acceptance thereof by the lessors in such manner as to terminate all further liability of the lessees to the lessors under the lease.'
The cause was remanded for the purpose of securing more testimony on whether the lessor re-entered for his own account or for the account of lessee.
The lease in the Kanter case contained this provision:
The court held that this provision could not be construed as providing for liquidated damages. The Kanter case returned to the Supreme Court of Florida styled as Kanter v. Safran, Fla.1955, 82 So.2d 508. The trial court found that the lessor had re-entered for his own account. The Supreme Court again reversed the lower court holding that the lessor had re-entered for the account of the lessee and directed that the bill be dismissed without prejudice to the lessees to sue for an accounting at the expiration of the term of the original lease.
Kanter v. Safran made its final appearance in the Supreme Court of Florida in Fla.1958, 99 So.2d 706. The...
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Hutner v. Denberg.
...140 129 So.2d 140 HUTNER v. DENBERG. Supreme Court of Florida. March 1961. Certiorari denied without opinion. 124 So.2d 502; 124 So.2d 503. ...