Florida Revocable Trust Trustee Wins Restitution Appeal — November 5, 2014 Florida trust litigation involving res judicata, unjust enrichment, splitting causes of action

If you are trustee Palm Beach and are involved in a trust lawsuit Florida  or legal issue of restitution, you may want to read a recent, November 5, 2014 Florida trust appeals case from Florida’s 2nd District Court of Appeal.  This Florida trust case also deals with the legal issues of res judicata and the rule against splitting causes of action, which your trust litigator Delray Beach may want to know about.

Trust Background:  trust invested in private company

• One of the parties to this Florida trust lawsuit was the trustee
• The trustee of the Florida trust and others were investors in a private Florida company
• 2006: trustee sues a shareholder investor re: shareholder agreement in Florida
• Rights of first refusal to buy the private shares and to increase one’s investment in the private Florida company were issues in this Florida trust case
• Rights of shareholders under the shareholder agreement and options to purchase shares were also at issue
• 2008: trial court rules for trustee
• The defendant was required to sell shares to the trustee and another
• 2009: Florida court of appeal affirms trial court’s ruling and judgment on the Florida shareholder agreement

Trustee seeks restitution of almost $400,000 re: dividend distribution

• Trustee files motion claiming he’s owed $396,000 but loses
• 2011:  trustee and other file second action against for RESTITUTION
• Claim by trustee:  defendant was unjustly enriched
• Defendant moves for summary judgment arguing that the claim for restitution was barred by Florida’s res judicata doctrine and rule against splitting causes of action
• Trial court found against trustee and the Florida appeal court reversed
• The cause of action in Florida for restitution was not “viable” until there was a judicial determination regarding the right to purchase the shares
• The trustee also had to tender payment for the shares
• The rule against splitting causes of action in Florida litigation says that all damages sustained or accruing to a person as a result of single wrongful act must be claimed and recovered in one action or not at all
• BUT……..

Trustee’s new claim for damages not barred until cause of action accrues

• In a victory for the Florida trustee involved in this shareholder litigation, the appeal court in Florida recognized that a new claim for damages may not be barred, and may proceed, if at the time of the initial lawsuit, or the initial underlying cause of action, it did not yet exist
• In other words, after a trial , after a judicial determination of wrongdoing or damages, there  may be new or additional causes of action which a Florida trustee may then assert
• Read Harlee IV v. Procacci, 2014 WLO 5653103, Florida, 2nd DCA, November 5, 2014, Judge Morris opinion.