JAMES L. BAUMAN AND PROSPERITY FINANCIAL, ETC., APPELLANTS,
v.
SUE M. RAYBURN, APPELLEE
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Appellants Bauman and Prosperity Financial challenged the denial of their motions to transfer venue from Orange County to Lake County in a suit alleging fraud and breach of fiduciary duty. The court affirmed, holding that the "local action rule" does not apply because the case seeks money damages and an equitable remedy (constructive trust) involving in personam jurisdiction rather than direct control over real property.
The local action rule does not apply because the underlying major question in the case concerns whether Appellants committed tortious acts of fraud and breach of fiduciary duty. The constructive trust remedy requested involves only in personam jurisdiction over Appellants and does not directly concern the legal status of the property itself.
[1] The "local action rule" pertains to a court's subject matter jurisdiction over real property disputes outside its territorial boundary, not venue.
[2] A court may not exercise in rem jurisdiction over property located outside its geographical territory.
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Join FLexlaw to unlock all legal intelligence“The "local action rule," although often discussed in the context of "venue," as the parties have in this case, is not actually a venue concept. Rather, it pertains to a court's subject matter jurisdiction to decide disputes related to real property located outside the court's territorial boundary.”
Establishes the fundamental nature of the local action rule as a subject matter jurisdiction issue rather than a venue issue
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Join FLexlaw to unlock all legal intelligenceBauman, acting as accountant and financial advisor to Rayburn, allegedly misappropriated her money and used it to purchase property in Lake County, ti…
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TORPY, J.
Appellants challenge the denial of their motions to transfer venue from Orange County to Lake County in this suit seeking money damages and the imposition of a constructive trust on real estate located in Lake County. We affirm.
The complaint alleges that Bauman, while acting in a fiduciary capacity as accountant and financial advisor to Appellee, purloined her money and used it to purchase property in Lake County, which he then had titled in the name of Prosperity Financial Services, Inc., a corporation wholly owned by Bauman. Appellee alleges that these acts by Appellants constituted fraud and breach of fiduciary duty.
Bauman concedes that he is a resident of Orange County, therefore, venue is proper as to him. § 47.011, Fla. Stat. (2003). Although not a resident of Orange County, venue is also proper as to Prosperity Financial Services, Inc., because it is a co-defendant. § 47.021, Fla. Stat. (2003). Nevertheless, Appellants contend that the action must be transferred to Lake County pursuant to the so-called “local action rule,” because Appellee seeks relief that affects property located in Lake County.
The “local action rule,” although often discussed in the context of “venue,” as the parties have in this case, is not actually a venue concept. Rather, it pertains to a court’s subject matter jurisdiction to decide disputes related to real property located outside the court’s territorial boundary. Goedmakers v. Goedmakers, 520 So. 2d 575, 578 (Fla.1988); Publix Super Markets, Inc. v. Cheesbro Roofing, Inc., 502 So. 2d 484, 489 (Fla. 5th DCA 1987) (superseded by statute on other grounds); Hudlett v. Sanderson, 715 So. 2d 1050 (Fla. 4th DCA 1998). Under the rule, a court may not exercise in rem jurisdiction over property located outside its geographical territory. Publix Super Markets, Inc., 502 So. 2d at 487. See also Lallouz v. Lallouz, 695 So. 2d 466, 467 (Fla. 3d DCA 1997). Thus, an action directly related to the legal status of real property, such as an action to quiet title or to foreclose a mortgage or lien, must be brought in the circuit wherein the property is located. Id. The rule does not limit a court’s in personam jurisdiction, however, even if the relief sought might incidentally affect real property located outside of the court’s territory. Lallouz, 695 So. 2d at 468. Whether the local action rule applies in a particular suit “depends upon the underlying major question in the case.” Goedmakers, 520 So. 2d at 579.
Here, the underlying major question is whether Appellants committed the tortious acts of fraud and breach of fiduciary duty. As a remedy for these purported wrongs, Appellee requests, in addition to monetary damages, that the court impose a constructive trust upon Appellants regarding the Lake County proper ty.1 To grant such relief only involves the exercise of in personam jurisdiction over Appellants, and, accordingly, the “local action rule” does not apply. Lallouz, 695 So. 2d at 467. See also Royal v. Parado, 462 So. 2d 849, 854 (Fla. 1st DCA 1985) (equitable action to rescind transfer of land was “in personam,” not subject to “local action rule.”); 77 Am.Jur.2d Venue § 11 (2003) (courts of equity act in personam; “local action rule” not applicable).
AFFIRMED.
THOMPSON and ORFINGER, JJ., concur. . “Constructive trust” is not a cause of action per se. Rather, it is an equitable remedy invoked to avoid an unjust enrichment. Sa-porta v. Saporta, 766 So. 2d 379, 381 (Fla. 3d DCA 2000) (quoting Wadlington v. Edwards, 92 So. 2d 629, 631 (Fla.1957)).
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Previewing 3 of 5 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Wadlington v. Edwards, 92 So. 2d 629 (Fla. 1957)
- Dade Cnty. Pub. Safety Dep't & CNA Ins. Cos. v. Adams, 502 So. 2d 484 (Fla. 1st DCA 1987)
- Royal v. Parado, 462 So. 2d 849 (Fla. 1st DCA 1985)
- Myers v. State, 520 So. 2d 575 (Fla. 1988)
- Hudlett v. Sanderson, 715 So. 2d 1050 (Fla. 4th DCA 1998)
- Saporta v. Saporta, 766 So. 2d 379 (Fla. 3d DCA 2000)
- Lallouz v. Lallouz, 695 So. 2d 466 (Fla. 3d DCA 1997)