Yusem v. Butler

966 So. 2d 405, 2007 WL 2316935
CourtDistrict Court of Appeal of Florida
DecidedAugust 15, 2007
Docket4D05-1250
StatusPublished
Cited by2 cases

This text of 966 So. 2d 405 (Yusem v. Butler) 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
Yusem v. Butler, 966 So. 2d 405, 2007 WL 2316935 (Fla. Ct. App. 2007).

Opinion

966 So.2d 405 (2007)

Henry YUSEM, Brian Yusem and Andrew Carlton, et al., Appellants,
v.
Robert BUTLER, Appellee.

No. 4D05-1250.

District Court of Appeal of Florida, Fourth District.

August 15, 2007.
Rehearing Denied November 5, 2007.

*407 John N. Buso, West Palm Beach, for appellants.

John Beranek of Ausley & McMullen, Tallahassee, H. Michael Easley of Jones, Foster, Johnston & Stubbs, P.A., West Palm Beach, and Richard H. Willits, Lake Worth, for appellee.

PER CURIAM.

This appeal and cross-appeal arise from approximately twenty years of litigation regarding a business partnership gone sour. The trial court entered a final judgment addressing the various claims of the parties. The Appellants raise five issues on appeal, and Robert Butler raises six issues on cross-appeal. We affirm as to the issues raised on appeal in all respects without further comment. We reverse as to the cross-appeal on five of the six issues raised.

In February 1992, Butler filed suit against Henry Yusem (Yusem), Brian Yusem, Andrew Carlton, and H.Y. (Wyncreek), Inc. regarding two business transactions, including the Wyncreek project which is the subject of this appeal. The project arose from the meeting of Yusem and Butler in 1985, at which time Yusem indicated that he was an expert commercial real estate developer. Yusem and his associates told Butler of the Wyncreek project in which they planned to construct commercial retail and office buildings on a particular site. Butler agreed to invest $400,000 in the project.

Subsequently, Butler and the Appellants (with Yusem acting through H.Y.) entered into a written partnership agreement to establish a limited partnership named Wyncreek Partners, Ltd. The general partners of the partnership were H.Y., Brian Yusem, and Carlton, and the limited partner was Butler. The Limited Partnership Agreement included the following provisions which are especially relevant to this appeal:

6.4 Project Completion. Construction and use of the Project in accordance with the site plan, survey, building elevations and landscape plan prepared by Digby Bridges, Marsh and Assoc., P.A., will not be prevented or delayed by any law, ordinance, easement or other encumbrance and will not require the consent or approval of any third party or governmental agency or other authority other than consents and approvals that *408 the General Partners believe, in their professional judgment, can be obtained within a reasonable period of time. Subject to governmental action, work stoppages, acts of God and other circumstances and conditions beyond the control of the General Partners, of which the General Partners have no knowledge as of the date hereof, completion of construction of the Project will not take more than 11 months from closing under the Purchase Contract and lease-up of the Project will not take more than 18 months from closing under the Purchase Contract.
* * * *
11.4 Governing Law. This Agreement and all matters relating to the organization and existence of the Partnership shall be governed by and construed and enforced in accordance with the laws of the State of Florida. In the event that any Partner shall commence an action with respect to the breach, interpretation or enforcement of this Agreement, or with respect to any matter involving the organization or existence of the Partnership, then the prevailing party or parties in said action shall be entitled to recover from the other party or parties all reasonable costs and expenses of litigation, including reasonable attorneys' fees, in such amount as may be determined by the court having jurisdiction of said action. The remedies of the Partners shall be cumulative and the exercise of any remedy or remedies, whether hereunder or otherwise, shall not exclude any other remedies provided for hereunder or otherwise.

Because Yusem was not individually a partner in Wyncreek, Butler requested that he enter into a Guaranty and Indemnification Agreement, which was duly executed by Yusem. The Guaranty and Indemnification Agreement included the following provisions particularly relevant to this appeal:

8. In addition to his other obligations under the Guaranty, Guarantor also hereby agrees to indemnify, defend, protect and hold [Butler] harmless from and against (a) any and all liability, loss, claims of third parties, costs, damage and expense (including reasonable attorneys' fees) that [Butler] may incur or sustain as a result of or in connection with the actions of HY/Inc. as General Partner under the Limited Partnership Agreement or otherwise under the Contracts or in connection with the Partnership, and (b) any loss of any benefit that would have inured to the benefit of [Butler] had Guarantor been a party to any of the Contracts in place of HY/Inc.
* * * *
13. . . . Guarantor agrees that [Butler], to the extent that he is in the prevailing party in any such action or proceeding, shall be entitled to recover from Guarantor his reasonable attorneys' fees and costs and disbursements of such action or proceeding.

Butler and the Appellants then individually signed a promissory note in the amount of $1,215,000 with First American Bank and Trust to purchase the Wyncreek property (and the partnership secured the loan with a mortgage on the property). The related Contract for Sale and Purchase of the Wyncreek site revealed that closing was scheduled for June 1985 (however, it appears from the closing binders that were admitted as exhibits at trial that the closing did not occur until August 1985). The parties later executed another promissory note in the amount of $2,585,000 (individually guaranteed) for the construction and development of the Wyncreek property (and entered into a written *409 Construction Loan Agreement). The Appellants acted as general contractors for the construction and development of the property.

Despite Appellants' representations to the contrary, Butler eventually discovered that the Wyncreek project was not being completed or leased-up as required under Section 6.4 of the partnership agreement. Butler alleged that these delays were due in part to violations of fiduciary duties by the Appellants, including: disbursements of partnership funds to pay for renovations of Carlton's home; disbursements of partnership funds for other personal uses of Carlton; and failure to keep accurate accounting records, failure to conduct an audit, and refusal to permit Butler to review financial records as required by the terms of the partnership agreement.

Based on this discovery, Butler filed a ten-count complaint against the Appellants. These counts alleged the following: dissolution of Wyncreek Partnership and request for accounting, breach of guaranty (against Yusem), declaratory judgment (against Yusem), foreclosure of partnership lien, breach of contract, fraud, breach of fiduciary duties, conversion, civil theft, and negligent misrepresentation. Many of these counts included requests for attorney's fees.

The Appellants (except Carlton) filed an Answer, Affirmative Defenses and Counterclaims to Butler's complaint, asserting twenty-seven affirmative defenses, none of which sought a set-off or asserted force majeure. The Appellants also alleged fourteen counterclaims against Butler. Carlton filed a separate Answer and Affirmative Defenses to Butler's consolidated complaint.

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Related

Butler v. Yusem
44 So. 3d 102 (Supreme Court of Florida, 2010)

Cite This Page — Counsel Stack

Bluebook (online)
966 So. 2d 405, 2007 WL 2316935, Counsel Stack Legal Research, https://law.counselstack.com/opinion/yusem-v-butler-fladistctapp-2007.