Pan-Am Tobacco Corp. v. State, Department of Corrections

425 So. 2d 1167, 1983 Fla. App. LEXIS 18415
CourtDistrict Court of Appeal of Florida
DecidedJanuary 7, 1983
DocketNo. AK-30
StatusPublished
Cited by2 cases

This text of 425 So. 2d 1167 (Pan-Am Tobacco Corp. v. State, Department of Corrections) 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
Pan-Am Tobacco Corp. v. State, Department of Corrections, 425 So. 2d 1167, 1983 Fla. App. LEXIS 18415 (Fla. Ct. App. 1983).

Opinions

LARRY G. SMITH, Judge.

This is an appeal from an order of the circuit court granting the Department’s motion for summary judgment on the grounds that sovereign immunity bars recovery by Pan-Am Tobacco Corporation (Pan-Am) for breach of contract as a matter of law. We affirm.

Early in 1978, Pan-Am entered into six identical vending machine contracts with six correctional centers under the jurisdiction of the Department. The contracts were each for a period of five years, and provided for the placement of vending machines at the centers containing candy, snacks, hot beverages, cold canned beverages and cigarettes. The contracts also provided for Pan-Am to pay commissions to the respective correctional centers on the vending machine sales. All of the contracts contained a provision that the institutions had the right to cancel the agreement upon sixty days written notice should Pan-Am’s service be deficient. However, the contracts further provided that this notice could be given only after Pan-Am had been advised in writing by the respective correctional institution of the deficiency, and had been given thirty days to correct the deficiency.

On May 23,1979, the Department’s superintendent of community facilities wrote Pan-Am a letter demanding that Pan-Am remove all its vending machines from the various correctional institutions within approximately thirty days from the date of the letter. Pan-Am removed the vending machines, then filed a six count complaint against the Department, alleging that the Department breached the vending machine contracts by failing to comply with the thirty-day notice provision. Pan-Am claimed damages for loss of income and profits for the balance of the terms of the contracts.

Pan-Am moved for partial summary judgment on the issue of liability, alleging that there was no dispute that the Department had not complied with the notice requirements. In response, the Department contended that sovereign immunity barred this action for breach of contract. The trial [1169]*1169court agreed, and entered an order denying Pan-Am’s motion for partial summary judgment. Subsequently, upon motion of the Department, the court entered a summary judgment of dismissal upon the grounds that sovereign immunity bars any action by Pan-Am for damages arising from breach of contract.

Any analysis of the question of the State’s sovereign immunity from contract actions must begin with Article X, Section 13 of the Florida Constitution which provides:

Provision may be made by general law for bringing suit against the state as to all liabilities now existing or hereafter originating.

In past years, this language has been interpreted as providing absolute sovereign immunity to the state and its agencies from actions for breach of contract in the absence of a waiver by legislative enactment or constitutional amendment. Hampton v. State Board of Education, 90 Fla. 88, 105 So. 323 (1925). However, in 1953 the Supreme Court decided Gay v. Southern Builders, Inc., 66 So.2d 499 (Fla.1953), which was apparently interpreted by the bench and bar as permitting suit against the government on a contract theory. Then in Department of Natural Resources v. Circuit Court of the Twelfth Judicial Circuit, 317 So.2d 772 (Fla. 2nd DCA 1975), one of the key decisions in this area of the law, the Second District Court of Appeal revived the concept that sovereign immunity does apply to protect the state and its agencies from suits upon contracts. That case involved a suit by the parents of a child who was attacked and killed by an alligator while swimming in a lake located in a park operated and maintained by the Department of Natural Resources. The suit was brought on theories of negligence, strict liability, and breach of contract. The plaintiffs, citing Gay v. Southern Builders, Inc., urged that the state was no longer immune from suit for breach of contract. But the district court rejected this argument, explaining:

In Gay, supra, Southern Builders entered into a contract with the Board of Commissioners of State Institutions to construct certain buildings for the State of Florida. The Board took the position that the building was not constructed in accordance with the plans and specifications and Southern Builders contended that it was entitled to payment under the contract plus damages for breach of contract. Southern Builders filed a claim with and against the Board. Three persons were named, who were called arbitrators, and held hearings and investigations as to the contentions of the parties. They filed a report with the Board; whereupon, the Board approved for final payment the amounts as recommended by the arbitrators.
The claim as adopted by the Board was presented to the comptroller who paid all the claim except that portion which he decided was for tort arising out of breach of contract. Southern Builders filed suit against the comptroller for payment of the claim in full as it had been approved for final payment by the Board. The circuit court rendered judgment for Southern Builders and the comptroller appealed. We feel the Supreme Court affirmed the lower court on the basis that the claim was approved by the Board for payment; that there was a determination by the Board that the amount ordered paid was just and due by the State to Southern Builders; and that in effect the suit was not a suit against the State for breach of contract but was for the enforcement of a claim previously determined to be due and owing by the State. The suit was actually seeking to enforce the comptroller to comply with the Board’s directions.
There is dicta in the Gay case, supra, which could be interpreted as saying that the State and its agencies are not immune from suit for breach of contract. If this is what Gay, supra, holds, it is in direct conflict with a long precedent of law first set forth in 1895 in Bloxham v. Florida Cent. & P.R., 35 Fla. 625, 17 So. 902, followed by Hampton v. State Board of Education, 1925, 90 Fla. 88, 105 So. 323, and State v. Love, 1930, 99 Fla. 333, [1170]*1170126 So. 374. We have found no case where our Supreme Court has held that under the facts and circumstances of this case the State or its agencies are not entitled to invoke sovereign immunity. 317 So.2d at 774-775.

Based upon its conclusion that the doctrine of sovereign immunity barred actions against the state for breach of contract, the Second District issued a writ of prohibition, holding that the trial court lacked subject matter jurisdiction and should have dismissed the suit. On appeal, the Florida Supreme Court quoted with approval the above language of the court of appeal, adopting this analysis as its own. Circuit Court of the Twelfth Judicial Circuit v. Department of Natural Resources, 339 So.2d 1113, 1116 (Fla.1976). Thus, in its latest pronouncement on the subject, the Florida Supreme Court has reaffirmed the principle that sovereign immunity exists as a bar to contract actions against the State and its agencies.

Nevertheless, Pan-Am urges that Circuit Court does not control this case since it was limited to its peculiar facts and circumstances. In that vein, appellant urges that under Circuit Court, sovereign immunity acts as a bar to suits on implied contracts but does not bar suits for breach of express contracts. Pan-Am also cites Interair Services, Inc. v. Insurance Company of North America, 375 So.2d 317 (Fla.

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Bluebook (online)
425 So. 2d 1167, 1983 Fla. App. LEXIS 18415, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pan-am-tobacco-corp-v-state-department-of-corrections-fladistctapp-1983.