FRANK R. DIAZ
v.
PARKLAND ESTATES

Fla. | 1934-03-14
114 Fla. 273 Florida Supreme Court (1934) Caution
Also reported at: 154 So. 199
Cited by 20 cases

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Synopsis

Frank Diaz challenged a judgment rendered against him by Parkland Estates, a corporation that was in default under Florida's 1931 corporate compliance statute requiring periodic fee payments and report filings. The Florida Supreme Court held that judgments rendered by corporations in such default are voidable, and courts have a duty to enforce the statutory prohibition against such suits regardless of whether the defendant raised the issue.


Holding

Judgments rendered by corporations in default under Chapter 14677 are voidable, not absolutely null and void, and the corporation does not lose its corporate existence. Courts have an affirmative duty to enforce the statute and prevent suits by non-compliant corporations, regardless of whether the defendant raised the issue, by arresting judgment or withholding execution until the corporation complies with the statute and revives its right to sue.


Key Quotes

“Corporations filing suits in the courts of this State are not required to affirmatively plead their compliance with Chapter 14677, Acts of 1931, as to the filing of reports and the payment of the prescribed fees collectable thereupon, but the terms of the statute are none the less applicable to a corporation in actual default, and it becomes the duty of all courts of this State to give effect to the statute by refusing to allow suits to be maintained in such courts of this State until defaults under the statute are duly remedied.”

Establishes that courts have an affirmative duty to enforce the statute regardless of pleading requirements

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Facts & Procedural History

Parkland Estates, a Florida corporation, sued Frank Diaz and obtained a judgment in its favor. However, at the time it instituted the suit and procure…

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Opinion of the Court
Davis, C. J.

Davis, C. J.

— Plaintiff in error relies upon Sections 4 and 5 of Chapter 14677, Acts of 1931, to reverse a judgment rendered against him in favor of Parkland Estates, a. Florida corporation, that, at the time of instituting its suit and *274procuring its judgment, was in default in compliance with the 1931 statutes which provide, in affirmative terms, that corporations failing for six months to comply with the provisions of that Act as to the payment of the fees and the making of the reports that such law requires, shall not be permitted to maintain any action in any court of this State until such reports are filed and all fees due thereunder are paid.

Corporations filing suits in the courts of this State are not required to affirmatively plead their compliance with Chapter 14677, Acts of 1931, as to the filing of reports and the payment of the prescribed fees collectable thereupon, but the terms of the statute are none the less applicable to a corporation in actual default, and it becomes the duty of all courts of this State to give effect to the statute by refusing to allow suits to be maintained in such courts of this State until defaults under the statute are duly remedied by the making of reports and the payment of fees, as the statute commands.

Judgments rendered in favor of corporations whose right to maintain suits has been suspended by the force and effect of a default in compliance with Chapter 14677, supra, are not absolutely null and void, nor is the charter of the corporation ipso facto forfeited thereby in the sense it becomes divested 'of its corporate existence, but the effect of the suspension of the right to sue at the time judgment was rendered, makes such judgment voidable in the same sense that a judgment rendered against a deceased natural person after his death is voidable, and upon the facts being called to the attention of the court rendering such judgment, it is the duty of the court to give effect to the statutory prohibition against maintenance of suit by arresting its judgment or withholding its execution thereon until the statute is *275fully complied with and the right to sue revived. Jarvis v. Chapman Properties, Inc., 110 Fla. 17, 147 Sou. Rep. '860.

Failure of a defendant to plead the suspension of the corporation plaintiff’s right to sue prior to entry of judgment in its favor, is immaterial, since the statute imposes a duty on the courts to recognize and enforce its terms and provisions whenever it is called to the court’s attention that the right of a corporation attempting to maintain proceedings before it has become suspended through the default in compliance with provisions of the law whose non-observance ex proprio vigore has that effect. This is so despite the fact that until the point is raised on the record, the right of a corporation to maintain a suit in the courts of this State will be presumed so long as the contrary is not made to appear.

While we do not approve and adopt all that was said by the Supreme Court of California in deciding a case similar to this, we make reference to its opinion in Ransome-Crummey Co. v. Superior Court in and for Santa Clara County, 188 Cal. 393, 205 Pac. Rep. 446, as supporting what we here decide to be the law applicable to the present case in the light of our own statute.

The statutory suspension of a corporation’s right to sue, being a mere procedural inhibition to maintain a suit in the courts of its creator State only so long as it continues in its default in making the reports and paying the dues legally exacted of it for the privilege of exercising its corporate functions, and being in the nature of a reasonable penalty imposed by law to exact conformity to a prescribed legal requirement, it is immaterial that the cause of action sued on arose before or after Chapter 14677, supra, was enacted.

Reversed for appropriate proceedings.

Ellis and Terrell, J. J., concur.

*276Whitfield, P. J., and Brown and Buford, J. J., concur in the opinion and judgment.


Cases With Similar Vibessemantic neighbors from the corpus


Citator

Cited By

  • Irwin v. Gilson Realty Co., Inc., 117 Fla. 394 (Fla. 1934)
    …a motion means an application for a rule or order made viva voce to a court or judge, but the term is now generally em [*401] ployed with reference to all such applications, whether written or oral.” In the recent case of Diaz v. Parkland Estates, 154 So. 199, the opinion in which was, written by Mr. Chief Justice Davis, this Court said: Failure of a defendant to plead the suspension of the corporation plaintiff’s right to sue prior to entry of judgment in its favor, is immaterial, since the statute imp…
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  • Cor-Gal Builders, Inc. v. Scotty Southard, 136 So. 2d 244 (Fla. 3d DCA 1962)
    …similar provision of the corporate code, F.S. § 608.35, F.S.A., which prevent a corporation from maintaining an action when its failure to pay annual corporate stock taxes is brought to the attention of a trial judge. See: Diaz v. Parkland Estates, 114 Fla. 273, 1S4 So. 199; Irwin v. Gilson Realty Co., 117 Fla. 394, 158 So. 77. Although the wording of these statutes may be similar, the purposes of the statutes are different. The Fictitious Name statute was enacted for the purpose of providing notice to any…
  • Am. Land Dev. Corp. v. Hillman, 138 So. 2d 756 (Fla. 2d DCA 1962)
    …7, 147 So. 860; Gray v. Central Florida Lumber Co., 104 Fla. 446, 140 So. 320, 141 So. 604; Christie v. Highland Waterfront Co., 114 Fla. 263, 153 So. 784; Irwin v. Gilson Realty Co., 117 Fla. 394, 158 So. 77; Diaz v. Parkland Estates, 114 Fla. 273, 154 So. 199; Burton v. Oliver Farm Equip. Sales Co., 121 Fla. 148, 163 So. 468] but serves to reinforce that opinion.” It is the view of this court that since the plaintiff corporation had complied with the statutory law of this state and had removed its delin…

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