Wofford v. Wofford

• Decision Date: 18 October 1937
• Citation: 129 Fla. 445,176 So. 499
• Parties: WOFFORD et al. v. WOFFORD et ux.
• Court: Florida Supreme Court

176 So. 499

129 Fla. 445

WOFFORD et al. v. WOFFORD et ux.

Florida Supreme Court

October 18, 1937

En Banc.

Suit by John B. Wofford and wife against Lee Verterie Wofford, also known as Tatem Wofford, Jr., and also known as Lee Holder and wife, and another. From the decree, defendants appeal.

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

COUNSEL

Frank Smathers, of Miami, for appellants.

E. F P. Brigham, of Miami, and William K. Whitfield, of Tallahassee, for appellees.

OPINION

CHAPMAN Justice.

On November 4, 1936, the appellees, who were plaintiffs below filed in the circuit court of Dade county, Fla., against the appellants, who were the defendants below, their bill of complaint for equitable relief and for a division of valuable real estate and personal property, the joint and beneficial ownerships thereof being in the parties to the suit. The bill prayed for an accounting as between the parties of all moneys coming into their possession from the operation of the business and rents, or otherwise as herein shown. Tatem Wofford, Jr., and John B. Wofford are brothers, and sons of Tatem Wofford, Sr., and Mrs. Ora B. Wofford. Tatem Wofford, Sr., died intestate, during the year 1927, and during the year 1930 Mrs. Ora B. Wofford married a Mr. William S. Buenz, when a separation occurred some few months thereafter. Mrs. Ora B. Wofford died testate on the 16th day of November, 1932, leaving all of her said property to John B. Wofford and Tatem Wofford, Jr., her sons. John B. Wofford married August 16, 1934, and Tatem Wofford, Jr., a short time prior to his mother's death.

The record shows that on March 27, 1923, Mrs. Ora B. Wofford acquired title to lot 1 of block 4 of the Ocean front property of the Miami Beach Improvement Company according to the plat thereof recorded in Plat Book 5 at pages 7 and 8, of public records of Dade county, Fla. Also other strips adjacent thereto and on said land was constructed a hotel building, equipment, furniture, furnishings, and fixtures, which subsequently became known as the 'Wofford Hotel.' On May 2, 1923, she caused the business to be incorporated with a capital stock of 3,000 shares of the par value of $100 per share. The corporation purchased of Mrs. Ora B. Wofford the said hotel property with all equipment, furnishings, and fixtures connected therewith, and for and in the consideration of $200,000 delivered to her therefor 2,000 shares of said stock, all being owned and in the name of Mrs. Ora B. Wofford, except one share to her attorney and one to her husband, Tatem Wofford, Sr., for convenience and organization purposes. The Wofford Hotel issued a mortgage or trust indenture on this property for the sum of $250,000 and from the business paid and caused the same canceled of record on March 1, 1929. The Hotel Wofford in June, 1928, was mortgaged the second time for the sum of $240,000, and the instrument and bonds were signed by Mrs. Ora B. Wofford as president and John B. Wofford as secretary of the Wofford Hotel, a Florida corporation. Payments on said bonds or mortgage out of the profits of the business were made from time to time, thereby reducing the same, until January 15, 1934, when the sum of $136,000 of the original $240,000 remained unpaid.

On January 15, 1934, the Wofford Hotel Corporation, through Tatem Wofford, Jr., president, and John B. Wofford, secretary, executed a refinance mortgage for the sum of $136,000, and simultaneously therewith conveyed their home to the Hotel Corporation, as additional security, for the loan so refinanced, and the said bonds were paid out of the profits of the hotel and the mortgage canceled of record on June 6, 1936, and all of the property now is free from liens or other mortgage indebtedness, and its market value is estimated at approximately $350,000 to $400,000. It has 142 bedrooms, situated at 2400 Ocean drive, Miami Beach, Fla., and is classified as a 'tourist hotel' and its seasons run from November 1st to the following April of each year. It has the capacity and does earn, annually, large net profits.

Likewise Mrs. Ora B. Wofford at the time of her death in her own right owned lots 14 and 15 in block 26, Fisher's first subdivision of Alton Beach, Miami, Dade county, Fla., and situated thereon is a spacious and pretentious home consisting of five bedrooms with three baths upstairs, with living room, dining room, and kitchen downstairs, two-car garage, servant quarters, playground facilities, well located, and valued at approximately $30,000.

It will be observed that the legal title to these two pieces of valuable real estate at the time of filing the bill of complaint was vested in the Wofford Hotel Corporation, a Florida corporation. It is alleged in the bill of complaint that the Wofford Hotel Corporation holds the lands and other properties therein described in trust for the beneficial owners, viz., the plaintiffs and the defendants: that the trust should be terminated and the properties sold and the proceeds arising therefrom divided between the parties; that the stockholders of the corporation, because of friction, dissension, and their belligerent attitude, rendered the corporation inactive, dormant, and failure on the part of the interested parties to co-operate with each other has caused a condition of stalemate and deadlock to such an extent that the purpose of purposes of its organization has ceased to exist.

On November 19, 1936, the defendants filed their answer to the bill of complaint, and material, salient, and important issues following are admitted by the pleading or fully established by the evidence as disclosed by the record, viz.:

(1) Conflicts and distrust between the brothers, and their respective wives, charges and countercharges of unfairness and dishonesty, unyielding hostilities and bitterness, fistfights, quarrels, and continuous disputes, covetousness, each brother wanted the hotel's management, and these conditions having existed since June, 1934, to the time of filing the suit. The special master in his report to the court of his findings as to fact touching on this point said: 'Unless there is a change in their attitude, due to the animosities and differences between the two brothers and their respective wives, and to their bitter personal feelings for each other, any future management, control and enjoyment of their joint properties by co-operative action, either personal or through the agency of the Wofford Hotel Corporation, as a corporation, is hopeless and apparently impossible.'

(2) That John B. Wofford and Tatem Wofford, Jr., as heirs of their father and as legatees under the will of their mother, each acquired and hold 1,000 of the 2,000 shares of the capital stock of the corporation and jointly acquired the said home situated on Washington street, their title and interest in the home under date of July 28, 1934, was conveyed by the brothers into the Wofford Hotel Corporation.

(3) All bonded indebtedness of the Wofford Hotel Corporation was paid from the net profits arising from the operation of the hotel.

(4) The parties admit the joint ownership of the property involved in the suit.

(5) Prior to dates of marriage Tatem and John B. Wofford as between them had but little friction or dissension.

(6) That the sum of $70,000 was by the brothers equally divided, each having drawn an annual salary of $7,500 and left a balance to the credit of Wofford Hotel.

(7) The minute books of the corporation show no formal meeting of the stockholders or directors since 1924. The minutes of the corporation show written notations and proceedings at the direction of Mrs. Ora B. Wofford and blank lines prepared for the necessary signatures, and the corporation, from the evidence, appears to have been used only when it was wanted to issue bonds or a mortgage. Mrs. Ora B. Wofford for all intents and purposes was the Wofford Hotel Corporation as long as she lived, and after her death her plan or policy of management was continued by her sons, John B. Wofford and Tatem Wofford, Jr., and later this policy was destroyed by animosities, bitterness, feuds, personal encounters as above shows. The special master found as a matter of fact, and the lower court decreed on final hearing, that, because of the dissensions and failure of co-operation between the parties, the Hotel Wofford Corporation as a corporate entity could not function, without an adjustment of the differences of the owners, and the only alternative for the preservation of all the property was to have the same disposed of at judicial sale and the proceeds arising therefrom equitably distributed among the joint and beneficial owners.

Considerable testimony was received on controversial issues, viz.: (a) The expediency or the inexpediency of the expenditure of $10,000 for improving the lobby of the hotel; (b) the market value and the annual rental of the home of Mrs. Ora B. Wofford left to her sons; (c) which of the two sons was better qualified to manage the hotel; (d) ownership of one share of the stock previously issued to P. G. Prevatt; (e) construction and interpretation to be placed on by-laws of the Wofford Hotel Corporation; (f) the legal accuracy or inaccuracy of the minutes of the corporation; (g) dispute over the business expediency of employment of a professional manager of the hotel. The recital of other contested issues is unnecessary for a decision of this cause, but considerable testimony was taken, as the record here shows around 1,400 pages.

The report and recommendations as made by the special master concerning a final decree were excepted to on 17 grounds by counsel for appellants, and the same were overruled or denied by the lower court and a final decree entered holding that...