Levine v. Levine

734 So. 2d 1191, 1999 WL 445693
CourtDistrict Court of Appeal of Florida
DecidedJuly 2, 1999
Docket98-02296
StatusPublished
Cited by21 cases

This text of 734 So. 2d 1191 (Levine v. Levine) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Levine v. Levine, 734 So. 2d 1191, 1999 WL 445693 (Fla. Ct. App. 1999).

Opinion

734 So.2d 1191 (1999)

Paul R. LEVINE, M.D., Stephen M. Zweibach, M.D., Mark R. Davis, M.D., P.A., a dissolved Florida professional association, Appellant,
v.
Paul R. LEVINE, M.D.; Susan W. Levine; Tampa Obstetrics, P.A., a Florida Professional Association; Richard Gordimer, C.P.A.; and Rivero, Gordimer & Company, P.A., Appellees.

No. 98-02296.

District Court of Appeal of Florida, Second District.

July 2, 1999.

*1192 N. Burton Williams, Valrico, for Appellant.

Thomas D. Shults of Hogreve & Shults, Sarasota, for Appellees Paul R. Levine, M.D., Susan W. Levine, and Tampa Obstetrics, P.A.

Stanford R. Solomon and Heather A. Pigman of Solomon & Benedict, P.A., Tampa, for Appellees Richard Gordimer, C.P.A., and Rivero, Gordimer & Company, P.A.

NORTHCUTT, Judge.

This appeal arises from a dispute among the three shareholders in the appellant corporation, a dissolved professional association of physicians. The order under review dismissed with prejudice the corporation's action against one of the shareholders and others. The circuit court held that the other two shareholders had caused the corporation to file the suit after they improperly removed the defendant shareholder from the corporation's board of directors. We conclude that the pleadings and exhibits before us reflect no impropriety in the defendant shareholder's expulsion from the board. Accordingly, we reverse with directions to reinstate the action.

BACKGROUND

The following facts are alleged in the corporation's first amended complaint or reflected in its exhibits. For purposes of the defendants' motions to dismiss and this appeal, they are taken as true.

The corporation, which we refer to as "LZD," ceased to do business in December 1990, and it was administratively dissolved by the Florida Department of State in August 1995. LZD's outstanding shares of common voting stock were owned in equal number by Drs. Paul Levine, Stephen Zweibach, and Mark Davis. Drs. Levine and Zweibach were the corporation's only directors, and Dr. Levine was its president. Dr. Levine's wife, Susan Levine, served as LZD's executive director. Dr. Levine was also the managing shareholder and president of another professional association, Tampa Obstetrics, P.A., and Mrs. Levine also functioned as that corporation's executive director.[1]

*1193 In 1996, the grantors of a note and mortgage given to LZD in 1988 sued for cancellation of the note and mortgage. At the June 1997 final hearing in that action, Dr. and Mrs. Levine testified that in December 1990 Dr. Levine, as president of LZD, had transferred all of LZD's furniture, fixtures, equipment and loans receivable to Tampa Obstetrics. Thereafter, the court hearing that matter rendered judgment declaring, among other things, that the transfer to Tampa Obstetrics was improper.[2]

In November 1997, Drs. Zweibach and Davis, holders of two-thirds of LZD's stock, voted to remove Dr. Levine from the corporation's board of directors and to replace him with Dr. Davis. This newly constituted board of directors then terminated Dr. Levine as LZD's president and caused the corporation to file the lawsuit giving rise to this appeal. These shareholder and director actions were accomplished by Dr. Zweibach's and Dr. Davis's written consent, without formal meetings and without prior notice.

PROCEEDINGS BELOW

LZD filed suit against the Levines and Tampa Obstetrics in January 1998, and shortly thereafter obtained an ex parte temporary injunction directing them to turn over LZD's corporate books and to maintain the assets alleged to have been improperly transferred to Tampa Obstetrics. As a condition to issuance of the injunction, LZD posted a $1,000 cash bond with the clerk of circuit court. On the defendants' motion, the court later ordered the injunction dissolved, at which time it directed the clerk to retain LZD's bond pending the court's determination whether the defendants were entitled to recover attorney's fees, costs or damages as a result of the injunction.

In due course, LZD filed an amended complaint that alleged six counts against five defendants. Count one was a replevin action against Tampa Obstetrics, seeking return of the assets transferred to it by Dr. Levine in December 1990. Count two charged Tampa Obstetrics with conversion of the same assets.

In count three, LZD alleged that between December 1990 and January 1998 Dr. and Mrs. Levine breached their fiduciary duties to the corporation by, among other things, transferring assets to Tampa Obstetrics and allowing that corporation to collect mortgage payments belonging to LZD, failing to properly conduct LZD's financial affairs, and failing to disclose the corporation's true financial condition to its directors and shareholders. Count four was an action against the Levines and Tampa Obstetrics for treble damages pursuant to chapter 772, Florida Statutes (1997).

Count five charged Dr. and Mrs. Levine, along with LZD's certified public accountant, Richard Gordimer, and his firm, Rivero, Gordimer & Company, P.A., with breaching fiduciary duties to the corporation. LZD asserted that these defendants had agreed among themselves to conceal the corporation's true financial condition by preparing and filing false or misleading state and federal tax returns between December 1990 and January 1998. Finally, count six alleged that Gordimer and his firm had committed malpractice during the same period.

All defendants moved to dismiss on several grounds. The circuit court granted their motions and dismissed the action with prejudice because "the Plaintiff did not have standing and did not have the legal basis for filing this lawsuit. Plaintiff did not follow and adhere scrupulously to the statutory condition precedents for the actions taken inasmuch as proper notice was not provided to one of the directors."

*1194 Alternatively, the court ruled that if it was later determined that LZD did have standing to bring the action, count three was dismissed without prejudice for failure to state a cause of action, and the remaining counts were dismissed without prejudice because they were not filed within the applicable statutes of limitations.

Finally, the order dismissing the action directed the clerk of circuit court to release LZD's $1,000 injunction bond to the Levines and Tampa Obstetrics.

DISCUSSION

The defendants maintain that LZD had no right to file the lawsuit because the board of directors that authorized the action was improperly constituted. They argue that Dr. Levine's dismissal as a director was ineffective because it was not done at a noticed meeting of shareholders pursuant to section 607.0808(4), Florida Statutes (1997).[3] That provision of the Florida Business Corporation Act provides:

(4) A director may be removed by the shareholders at a meeting of shareholders, provided the notice of the meeting states that the purpose, or one of the purposes, of the meeting is removal of the director.

LZD contends that because Drs. Zweibach and Davis together held sufficient votes to remove a director from the board, they were authorized to act in writing and without a noticed meeting by section 607.0704, Florida Statutes (1997), which, in pertinent part, states:

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Bluebook (online)
734 So. 2d 1191, 1999 WL 445693, Counsel Stack Legal Research, https://law.counselstack.com/opinion/levine-v-levine-fladistctapp-1999.