Sanwa Bank, Ltd. v. Kato

734 So. 2d 557, 24 Fla. L. Weekly Fed. D 1331
CourtDistrict Court of Appeal of Florida
DecidedJune 4, 1999
Docket98-1005
StatusPublished
Cited by19 cases

This text of 734 So. 2d 557 (Sanwa Bank, Ltd. v. Kato) 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
Sanwa Bank, Ltd. v. Kato, 734 So. 2d 557, 24 Fla. L. Weekly Fed. D 1331 (Fla. Ct. App. 1999).

Opinion

734 So.2d 557 (1999)

SANWA BANK, LTD., Appellant,
v.
Shigeru KATO, Sunshine State Resort Holding, Inc., etc., et al., Appellees.

No. 98-1005.

District Court of Appeal of Florida, Fifth District.

June 4, 1999.

*558 Guy A. Rasco, Jennifer R. Coberly, John A. Thornton, of Zuckerman, Spaeder, Taylor & Evans, LLP, Miami, for Appellant.

T. Todd Pittenger and Terry C. Young, of Lowndes, Drosdick, Dostor, Kantor & Reed, P.A., Orlando, for Appellees, Sunshine State Resort Holding, Inc., Florida Windermere, Inc., and Florida Deer Run, Inc.

Mercer K. Clarke, William J. Dimmig, of Clarke, Silverglate, Williams & Montgomery, Miami, for Appellee, Shigeru Kato.

No Appearance for Appellee, Takaski Kitazawa.

GRIFFIN, C.J.

Sanwa Bank, Ltd., ["Sanwa"] appeals an order dismissing its action on the basis of forum non conveniens. It further appeals an order denying, without a hearing, a motion for a temporary injunction filed by Sanwa. We affirm in part and reverse in part.

This case involves a loan made by Sanwa to Onjuku Yakatayama Country Club Co., Ltd., ["Onjuku Ltd."][1] in the amount of 3,000,000,000 yen.[2] The loan was made on or about July 11, 1990. The purpose of the loan was the purchase of equipment, for a golf course in Japan which Onjuku Ltd. was developing. The loan was personally guaranteed by Shigeru Kato ["Kato"], the president and sole stockholder of Onjuku Ltd. Kato not only signed the agreement as guarantor, but specifically agreed that "[he] bears joint liability for the performance of this obligation." The loan was to be repaid in full by July 11, 1992.[3]

Onjuku Ltd. apparently never made regular payments on the loan and ultimately defaulted. Several extensions of the due date were given and amendments to the loan ultimately provided for an extension of the repayment date to June 30, 1995 ["the final due date"]. As part of the these extensions, Kato and Onjuku Ltd. also signed an "Undertaking Regarding a Pledge of Shares" ["the share agreement"] on August 31, 1993 and an "Undertaking Regarding Repayment of Loans" ["the loan renegotiation agreement"] on December 17, 1993. The share agreement obligated Kato to obtain the bank's consent prior to transferring his ownership of 2,000 shares in Onjuku Golf Club K.K. to any third party.

Sanwa asserts in its complaint that, in fact, the loan proceeds were not used to purchase equipment, but were instead transferred to other companies owned by Kato, and that ultimately the funds were used to purchase two golf courses located in Central Florida. Specifically, Sanwa asserts *559 that from October 1990 through April 1991, Kato transferred in excess of 2,000,000,000 yen from the loan proceeds to Wako Kanko Co., Ltd. ["Wako Ltd."], a second company wholly-owned by Kato. Wako, in turn, allegedly transferred 1,780,845,000 yen (approximately $12,900,000 U.S. dollars) to Sunshine State Resort Holding, Inc. ["Sunshine Holding"], which used the money to purchase the Windermere Golf Course and the Deer Run golf course, both of which are located in Central Florida.

In late 1997, Sanwa brought the instant action against Kato, Sunshine Holding, Windermere and Deer Run. Neither Onjuku Ltd. nor Wako Ltd. was made a party to the action. Count I of Sanwa's complaint was styled as a claim for breach of contract. The count alleged that Kato had breached the guaranty by the failure to repay the loan. The count further alleged that Sunshine, Windermere and Deer Run [collectively "the Florida corporate defendants"] were Kato's "alter egos" and that they were therefore also obligated on Kato's guarantee. Count II was an action based on the same "alter ego" theory.

Kato and the Florida corporate defendants filed an amended motion to dismiss the complaint for failure to state a cause of action. Shortly thereafter, the Florida corporate defendants also filed a motion to dismiss based on forum non conveniens. The motion alleged that Japan was the more appropriate forum for trial of this action because: (1) the loan underlying Kato's guaranty had been made in Japan, by a Japanese bank (Sanwa), to a Japanese corporate borrower (Onjuku Ltd.); (2) Sanwa had been engaged in litigation in Japan with Kato and Onjuku Ltd. since November 18, 1997; (3) Kato was challenging Florida's personal jurisdiction over him; (4) the Florida corporate defendants were not signatories to the loan or the guaranty which formed the basis of the action; and (5) the Florida action was premature, in that it represented an attempt to collect the debt from the Florida corporate defendants prior to any determination of the amount due on the underlying obligation. As an alternative to dismissal of the action, the Florida corporate defendants asked for entry of an order staying the litigation until such time as the liability of Kato and Onjuku Ltd. for the underlying debt had been established in a Tokyo district court.

Sanwa filed an amended complaint on or about February 11, 1998, which added Takasi Kitazawa ["Kitazawa"], Kato's brother-in-law, as a defendant and added a number of additional counts. The claim against Kitazawa is based on the allegation by Sanwa that Wako Ltd., which is wholly-owned by Kato, transferred its entire interest in Sunshine Holding to Kitazawa on February 14, 1994, approximately two months after Kato had executed the December 17, 1993 loan renegotiation agreement. The complaint as amended contained seven counts. Four counts were brought against Kato and the Florida corporate defendants: (1) breach of contract, based on the alleged breach of the guaranty; (2) account stated; (3) breach of contract, based on the alleged breach of December 17, 1993 loan renegotiation agreement;[4] and (4) unjust enrichment. Sanwa also brought claims against all defendants, including Kitazawa, for violation of Florida's Uniform Fraudulent Transfer Act, see §§ 726.101, et. seq., Florida Statutes, and for constructive trust. The only other claim contained in the complaint was a claim for unjust enrichment against Kitazawa.

The lower court conducted a hearing on the forum non conveniens issue, and allowed subsequent written argument. Sanwa argued that dismissal of the case in favor of a Japanese forum was improper because (1) there was no adequate alternative *560 forum, given that Japan had no jurisdiction over the Florida corporate defendants or the subject matter of the amended complaint; and (2) the witnesses needed to prove many of these claims, such as the claim for violation of Florida's Uniform Fraudulent Transfer Act and the claims for unjust enrichment, were located in Florida. Sanwa also contended that the forum selection clause contained in Sanwa's contract with Onjuku Ltd. permitted, but did not require, Sanwa to bring suit in Japan.

Defendants contended that in reality all of the claims made in this case concern acts which occurred in Japan and not Florida. They asserted that the only connection this case has with Florida is that the golf courses are in Florida and the corporate transfers may have been memorialized after the fact in Sunshine's corporate records, which are maintained in Florida. Defendants argued that Florida itself could not be considered an adequate forum, since Florida has no jurisdiction over non-residents such as Onjuku Ltd., Wako Ltd., Kato and Kitazawa, and they were necessary or indispensable parties to any action to resolve Sanwa's claims, which rested on an "alter ego" theory.

Defendants' written response also took issue with a number of factual assertions made by Sanwa.

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Bluebook (online)
734 So. 2d 557, 24 Fla. L. Weekly Fed. D 1331, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sanwa-bank-ltd-v-kato-fladistctapp-1999.