Ryan v. Lobo De Gonzalez

• Decision Date: 26 February 2003
• Docket Number: No. 4D00-4658, No. 4D01-2389.
• Citation: 841 So.2d 510
• Parties: John RYAN, IV, Victoria Ryan, Alin Ryan Smith and Carolina Ryan Camperio, and Robert E. Nall, as personal Representative of the Estate of Julio Lobo Olabarria, Appellants, v. Leonor LOBO DE GONZALEZ and Jorge Gonzalez, Appellees.
• Court: Florida District Court of Appeals

841 So.2d 510

John RYAN, IV, Victoria Ryan, Alin Ryan Smith and Carolina Ryan Camperio, and Robert E. Nall, as personal Representative of the Estate of Julio Lobo Olabarria, Appellants, v. Leonor LOBO DE GONZALEZ and Jorge Gonzalez, Appellees.

Nos. 4D00-4658, 4D01-2389.

District Court of Appeal of Florida, Fourth District.

February 26, 2003.

Rehearing Denied April 17, 2003.

Gerald F. Richman, Manuel A. Garcia-Linares, Mark A. Romance and Laline Concepcion-Veloso of Richman Greer Weil Brumbaugh Mirabito & Christensen, P.A., Miami, for appellants.

George H. Moss and Casey Walker of Moss, Henderson, Blanton & Lanier, Kretschmer & Murphy, P.A., Vero Beach, for appellees.

HAZOURI, J.

John Ryan, IV, Victoria Ryan, Carolina Ryan Camperio and Alin Ryan Smith ("the children"), as assignees of Maria Luisa Lobo Ryan, and Robert Nall, as personal representative of the estate of Julio Lobo Olabarria ("the Estate"), filed suit against Leonor Lobo de Gonzalez and Jorge Gonzalez to recover the shares of Chiriqui Sugar Mills Corporation ("Chiriqui"), a Panamanian corporation holding title to sugar properties in Cuba. The trial court determined that all the claims raised in the Second Amended Complaint were barred by the statute of limitations and entered final summary judgment in favor of Leonor and Jorge Gonzalez. The children and the Estate appeal from the order of final summary judgment (Case No. 4D00-4658). Leonor and Jorge Gonzalez appeal from the trial court order denying their Motion for Sanctions/Fees and Costs Based on Proposal for Settlement (Case No. 4D01-2389). The two appeals have been consolidated.

Maria Luisa Lobo Ryan ("Maria Luisa"), who is deceased, and Leonor Lobo de Gonzalez ("Leonor") are the two daughters of Julio Lobo Olabarria ("Julio Lobo"), who is also deceased. Jorge Gonzalez is the husband of Leonor. John Ryan, IV, Victoria Ryan, Carolina Ryan Camperio and Alin Ryan Smith are the children of Maria Luisa, through whom they claim as assignees. Robert Nall is the personal representative of the estate of Julio Lobo. This case deals with a dispute over who should have possession of shares in Chiriqui Sugar Mills Corporation.

In 1957, Julio Lobo formed Chiriqui to purchase Hershey Sugar Corporation and its affiliated companies, Rosario Sugar Company and Compañía Azucarera Gómez Mena, from the Cuban Atlantic Sugar Corporation. The three properties consisted of agricultural lands, three mills and a refinery with an integrated railroad system linking the three mills. The Chiriqui shares were represented by bearer stock certificates. Julio Lobo purchased the properties for $25 million. To finance part of the purchase, he obtained a $9 million loan from First National City Bank ("City Bank") and pledged the Chiriqui shares and its underlying properties as collateral. In 1960, Fidel Castro nationalized and confiscated the properties and Julio Lobo's assets. As a result, Julio Lobo defaulted on the City Bank loan.

In 1963, the City Bank loan was renegotiated and modified by Julio Lobo. As part of the modification, the Moorings Development Company ("Moorings"), a Florida real estate development company controlled by Julio Lobo but owned 50-50 by Maria Luisa and Leonor, assumed $3.7 million of the Chiriqui debt and secured the debt with Moorings shares. In exchange, the Moorings obtained a Chiriqui promissory note in its favor in the amount of $3.7 million, the amount of the assumed debt. The parties agreed that if Julio Lobo defaulted on this restructured loan, the Moorings would receive the Chiriqui shares. Julio Lobo never made any payments on the note and was in default by 1965. The Moorings seized the Chiriqui shares but did not file any documents reflecting the seizure with the Panama Public Registry. The Moorings did not list the Chiriqui shares in any of its financial statements nor in any of its tax returns.

Enrique León, Julio Lobo's Cuban attorney, testified that the Moorings seizure of the Chiriqui shares was a scheme orchestrated by Julio Lobo to protect the Moorings from the IRS and creditors. He testified that Julio Lobo considered himself the owner of the Moorings and that he expected to retain the Chiriqui shares.

In 1967, the Moorings began to operate independently of Julio Lobo despite his protests, and by 1968 he had no control in the Moorings. In 1968, the Moorings sold the Hershey trademark, a Chiriqui property, to Hershey of Pennsylvania. Julio Lobo received in excess of $100,000 from the sale but was dissatisfied with the amount.

In 1971, Julio Lobo wrote several letters to his attorneys in Miami concerning his desire to obtain control of the Moorings and the Chiriqui shares and his belief that they belonged to him. Letters written in 1972 from Julio Lobo to his Miami attorneys indicate that Enrique León, his former attorney in Cuba, reached an agreement with his daughters and that the Chiriqui shares would be returned to him. Enrique León testified that there was an agreement reached in 1972 for the return of the shares. However, subsequent letters from Julio Lobo to his attorneys indicate that Julio Lobo lost all hope that he would retain any interest in the Moorings or the Chiriqui shares. In May 1974, by letter to his attorneys, Julio Lobo indicated that based on their recommendation he decided not to enforce his rights in the Moorings or to the Chiriqui shares. He recognized that "the tax people" were after him and that if he were to succeed, all would go to the IRS. He also indicated a desire to salvage his relationship with his daughters. The children and the Estate allege that Julio Lobo decided not to take any legal action, because he reached an agreement with his daughters that the Chiriqui shares would be returned to him "at the appropriate time," as evidenced by Jorge Gonzalez's deposition testimony and letters written by Julio Lobo. However, there are no documents in the record dated after the 1974 letters to his attorneys that support the assertion that Julio Lobo had any hope of retaining the Chiriqui shares. Additionally, Jorge Gonzalez's testimony indicates that there was no agreement that Julio Lobo would receive the Chiriqui shares absent some form of consideration.

In 1980, Maria Luisa redeemed her 50% interest in the Moorings for several tracts of land which were subsequently sold for approximately $8 million. The parties dispute whether Maria Luisa was aware that the Chiriqui shares were an asset of the Moorings and whether the Chiriqui shares were factored into the compensation she received when she redeemed her interest. There is record evidence to support both parties' allegations.

Julio Lobo died in 1983 without having taken any legal action to establish an interest in the Moorings or in the Chiriqui shares.

In 1984, Leonor sold her 100% interest in the Moorings for substantially more than Maria Luisa received for her interest. Leonor did not include the Chiriqui shares in the sale. Before the sale, Leonor removed the Chiriqui shares from the Mooring's safety deposit box and kept them in a shoe box.

In 1991, John Ryan, a son of Maria Luisa, began to investigate and compile a list of Julio Lobo's assets and learned of the Chiriqui shares. Leonor acknowledged at a meeting of the Asociación Naciónal de Hacendados de Cuba (National Association of Landholders of Cuba) that she and Maria Luisa shared interest in the Chiriqui shares 50-50. She acknowledged at a deposition that she did not assert more than a 50% interest in the Chiriqui shares before 1996.

In March 1996, Leonor filed a document with the Panama Registry claiming to be the 100% owner of Chiriqui and transferred her interest in the Chiriqui shares to a Florida corporation. The children and the Estate allege that this was the first time Leonor claimed 100% ownership of the Chiriqui shares, and that they first learned that Leonor was claiming 100% interest in April 1996.

Maria Luisa died in February 1998. On December 30, 1998, the children and the Estate of Maria Luisa filed suit against Leonor and Jorge Gonzalez to recover the Chiriqui shares. The following claims were asserted: constructive trust, reformation for mutual mistake, breach of fiduciary duty, declaratory judgment, negligent misrepresentation and permanent injunction. The Complaint was dismissed on the basis of the statute of limitations defense. The Amended Complaint was filed on October 1, 1999. On October 20, 1999, Leonor and Jorge Gonzalez served a proposal for settlement on the children pursuant to the offer of judgment statute, section 768.79, Florida Statutes (1997). Defendants offered each of the children $100 (for a total of $400) to settle their claims. The children declined the proposal for settlement.

On October 29, 1999, Defendants filed their Answer to the Amended Complaint, again raising the statute of limitations defense. On November 2, 1999, Defendants filed a Motion for Final Summary Judgment, arguing that all of the children's claims were barred by the statute of limitations. On April 13, 2000, the trial court denied Defendant's Motion for Summary Judgment on the basis that discovery had not been completed.

On August 4, 2000, the Second Amended Complaint was filed, adding the Estate of Julio Lobo as a plaintiff, dropping the Estate of Maria Luisa as a plaintiff and with the children proceeding as Maria Luisa's assignees. The claims asserted were the same as in the Amended Complaint. The Second Amended Complaint generally alleges as follows: Julio Lobo orchestrated the Moorings' "alleged" acquisition of the Chiriqui shares in order to protect Chiriqui from creditors and with the understanding that they would be returned to Julio Lobo "at an appropriate time"; Maria Luisa was never aware that the Moorings "allegedly" acquired the Chiriqui shares; when Maria Luisa sold her 50% interest in the Moorings she was not aware that the Chiriqui shares were part of the sale; the Moorings failed to properly seize...