OAKS SHOPPING CENTER, INC., ETC., APPELLANT,
v.
JUSTICE MARKETING, INC., ETC., ET AL., APPELLEES
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Oaks Shopping Center appeals a trial court judgment dismissing its claims against Justice Marketing and its owners for fraud, conversion, and statutory violations related to the unauthorized removal and sale of equipment subject to a landlord's lien. The appellate court reverses, finding that the trial court erred in determining that Oaks' lien was unperfected and that the defendants did not intentionally defeat enforcement of the lien.
A landlord's lien does not require filing or recording to be perfected and takes precedence over a purchase money lien that was not perfected. The trial court's finding that the defendants did not intentionally defeat the lien was not supported by the record, as evidence clearly showed the Justices knew of the lien, breached the lease by early termination, and sold lien-encumbered property without the lienholder's consent.
[1] A landlord's lien on equipment located on leased premises is perfected without the need for filing or recording.
[2] A purchase money lien, even if prior in time, does not take precedence over a landlord's lien if the purchase money lien is not perfected.
Previewing 2 of 4 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“A landlord hen is not required to be filed or recorded in order to be perfected.”
Establishes the key legal principle that perfection of a landlord's lien does not depend on filing or recording, contrary to the trial court's reasoning.
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Join FLexlaw to unlock all legal intelligenceOaks leased real property to Justice Marketing under a three-year lease and held a landlord's lien on equipment on the premises. While rent payments r…
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HARRIS, Judge.
The Oaks Shopping Center, Inc. (Oaks) leased real property to Justice Marketing, Inc. (Justice) for a three year term. Oaks' had a landlord hen on the equipment kept on the premises. During the term of the lease but while the monthly payments were current, Justice moved out of the premises. Harry and Shelby Justice, the owners and officers of Justice, sold the equipment to a third person. Oaks sued Justice and its officers for fraud, conversion and for violation of sections 818.01 and 818.03, Florida Statutes, for removing and disposing of the equipment upon which a landlord hen existed.
Harry and Shelby Justice contended that they had loaned Justice $175,000 to acquire the equipment and thus had a purchase money hen superior to Oaks’ hen. The trial court determined that Oaks’ hen was inferior to Justice’s hen because Oaks had failed to “perfect” its lien. The trial court erred. A landlord hen is not required to be filed or recorded in order to be perfected. See Beason-Simons v. Avion Technologies, Inc., 662 So. 2d 1317 (Fla. 4th DCA 1995). On the other hand, the Justice hen, even if prior in time, would not take precedence over the landlord hen because it needed to be but was not perfected. See Lynch Austin Realty, Inc. v. Engler, 647 So. 2d 988 (Fla. 2d DCA 1994).
The trial court also found that there was no evidence that Harry and Shelby Justice “intentionally defeated, hindered or otherwise delayed enforcement of any lien of Plaintiff.” This finding is not supported by the record. The record is clear that the Justices were aware of the landlord hen, that they were breaching the lease by early termination, and that they were selling property subject to a landlord hen. See Littman v. Commercial Bank & Trust Co., 425 So. 2d 636 (Fla. 3d DCA 1983), which held that the bank had satisfactorily estabhshed the elements of section 818.01 by showing that the defendant sold the lien-encumbered property to a third party without the consent of the bank and consequently failed to produce the property when it was demanded by the bank.
REVERSED and REMANDED for further action consistent with this opinion.
COBB and GOSHORN, JJ., concur.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Authorities Cited
- Littman v. Commercial Bank & Tr. Co., 425 So. 2d 636 (Fla. 3d DCA 1983)
- Lynch Austin Realty, Inc. v. Engler, 647 So. 2d 988 (Fla. 2d DCA 1994)
- Beason-Simons v. Avion Techs., Inc., 662 So. 2d 1317 (Fla. 4th DCA 1995)