TERRY TAYLOR, APPELLANT,
v.
WELLINGTON STATION CONDOMINIUM ASSOCIATION, INC., A NOT-FOR-PROFIT FLORIDA CORPORATION, APPELLEE
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A Florida appellate court reversed summary judgment against a condominium board member who was sued for breaching his fiduciary duty by failing to enforce the developer's payment obligations. The court held that willfulness and individual liability are fact questions for a jury, not appropriate for summary judgment.
Summary judgment was improper because willfulness is a fact question for the jury, not determinable as a matter of law. Additionally, a factual issue existed whether Taylor's conduct rose to the level of individual liability, which generally requires showing fraud, self-dealing, or unjust enrichment beyond mere corporate status.
[1] Summary judgment is improper when the moving party's complaint and motion require a finding of intent, and intent is a disputed issue of fact.
[2] Individual liability for corporate acts generally requires proof of actual wrongdoing, such as fraud, self-dealing, or unjust enrichment, beyond mere official status.
Previewing 2 of 5 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Since the Association's motion and complaint requested a finding that Taylor was liable to the Association for willfully breaching his fiduciary duty, the trial court would necessarily have to make a finding that Taylor acted with intent in order to grant the motion. Thus, the motion should have been denied since willfulness was placed into issue by the Association and the issue is one for the jury.”
Establishes that willfulness is a jury question precluding summary judgment
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Join FLexlaw to unlock all legal intelligenceTerry Taylor served as a director of Wellington Station Condominium Association and was a 25% shareholder in the developer. The Association alleged Ta…
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COBB, Judge.
The issue on this appeal is whether the trial court properly entered summary judgment in favor of a condominium association, Wellington Station Condominium Association, Inc. (Association) in regard to the liability of the appellant, Terry Taylor (Taylor).
On May 26, 1992, the Association filed a complaint against Taylor alleging breach of fiduciary duty. Taylor served on the Association’s board of directors and was listed as an officer of the developer.1 Taylor was also a twenty-five percent shareholder in the developer. According to the complaint and motion for summary judgment, Taylor “willfully” breached his fiduciary duty to the Association. Specifically, the Association alleged that Taylor failed: (1) to enforce the obligation of the developer to pay its share of common expenses; (2) to properly allocate Association funds for the use and benefit of the Association; and (3) to properly designate expenses chargeable to the developer.
Thus, the Association alleged that Taylor acted solely at the urging of the developer in order to achieve financial gain since he failed to enforce the developer’s obligation to deliver to the Association reserve funds in the amount of $39,352.00.
The trial court agreed and entered a partial summary final judgment finding, as a matter of law, that Taylor was liable to the Association for his failure to set aside reserve funds for the condominium as required by law. All other matters alleged in the complaint were deemed to be still at issue, including the amount of damages, attorney’s fees, and eosts.
In the instant case, we agree that summary judgment was improper. Since the Association’s motion and complaint requested a finding that Taylor was liable to the Association for willfully breaching his fiduciary duty, the trial court would necessarily have to make a finding that Taylor acted with intent in order to grant the motion.
Thus, the motion should have been denied since willfulness was placed into issue by the Association and the issue is one for the jury. See Parker v. Bryce, 96 So. 2d 154 (Fla.1957). Additionally, a factual issue existed as to whether Taylor’s conduct was sufficient to rise to the level necessary to indicate individual liability. Generally, directors, officers and stockholders are not liable for corporate acts simply by reason of their official relationship to the corporation. Actual wrongdoing in the form of fraud, self-dealing or unjust enrichment would have to be established in order to trigger individual liability. Munder v. Circle One Condominium, Inc., 596 So. 2d 144 (Fla. 4th DCA 1992); see also Avila South Condominium Association v. Kappa Corp, 347 So. 2d 599 (Fla.1977).
Fac tually, Taylor was only one of three directors of the Association and was a twenty-five percent minority shareholder in the developer. While there is some evidence of breach of fiduciary duty, ie., self-dealing, the issue is far from certain given the evidence that Taylor lost his initial investment. What is clear is that Taylor cannot be held individually liable simply because of his status as a director of the Association.
Accordingly, we reverse the partial summary final judgment as to liability and remand for further proceedings.
REVERSED AND REMANDED.
SHARP and DIAMANTIS, JJ., concur. . Taylor signed the Articles of Incorporation for the Association and was listed as one of three members of its first board of directors. Taylor reportedly never attended a board meeting or annual membership meeting. On the other hand, there was conflicting evidence as to whether Taylor served as a director of the developer. He was, however, expressly listed in the Shareholders Agreement as a Secretary/Treasurer of the development corporation without day-to-day management duties.
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Sonny BOY, L.L.C. v. Bhagwan Asnani, 879 So. 2d 25 (Fla. 5th DCA 2004)…e, e.g., Perlow v. Goldberg, 700 So. 2d 148 (Fla. 3d DCA 1997) (finding directors of condominium associations not individually liable for actions and governance of condominium association); Taylor v. Wellington Station Condominium Association, Inc., 633 So. 2d 43 (Fla. 5th DCA 1994) (finding that in general, corporate directors and officers cannot be personally liable for corporate acts absent actual wrongdoing in the form of fraud, self-dealing or unjust enrichment to trigger individual liability); Munder v…1 / 2
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Baron v. Ahmed M. Osman, 39 So. 3d 449 (Fla. 5th DCA 2010)…PY and COHEN, JJ., concur. . Osman may be held liable individually for the unpaid compensation should the trial court find "[a]ctual wrongdoing in the form of fraud, self-dealing or unjust enrichment.” See Taylor v. Wellington Station Condo. Ass’n, 633 So. 2d 43, 45 (Fla. 5th DCA 1994).…
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Curbelo v. Sweetwater Creek Homeowners Condo. Ass'n, Inc., 653 So. 2d 1073 (Fla. 3d DCA 1995)…eged breach. The trial court denied defendants’ motion to dismiss, as well as their motions for a directed verdict and for judgment notwithstanding the verdict. In so doing, the trial court erred. See Taylor v. Wellington Station Condominium Ass’n., 633 So. 2d 43 (Fla. 5th DCA 1994) (officer of developer cannot be held individually liable simply because of status as director of association). But cf. B & J Holding Corp. v. Weiss, 353 So. 2d 141 (Fla. 3d DCA 1977) (initial directors could be held liable to ass…
Previewing 3 of 7 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Avila S. Condo. Ass'n v. Kappa Corp., 347 So. 2d 599 (Fla. 1976)
- Arturo A. Munder & 444 Inverrary Corp. v. Circle ONE Condo., Inc., 596 So. 2d 144 (Fla. 4th DCA 1992)
- Parker v. Bryce, 96 So. 2d 154 (Fla. 1957)