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227 So. 2d 245

Brown v. Epstein

District Court of Appeal of Florida

Decided September 26, 1969

District Court of Appeal of Florida · decided 1969-09-26

Cited by 2 later decisions — most recently October 1989

1 federal appellate · 1 state decisions

Key passage — most relied on by later courts

“(5) If the action on behalf of the corporation is successful, in whole or in part, or if anything is received by the plaintiff or plaintiffs as the result of a judgment, compromise, or settlement, the court may award the plaintiff or plaintiffs the reasonable expenses of maintaining the action, including reasonable attorneys' fees, and direct him or them to account to the corporation for the remainder of the proceeds so received by him or them.”

quoted by 1 later decision, including 550 So. 2d 1145 - Ginsberg v. Keehn

Relies on 73 So. 2d 684 - Shavers v. Duval County · Brown v. Epstein

Good law ✅— No negative treatment on recordhow we know

Decided 1969-09-26

View the full empirical analysis of this case →

OWEN, Judge.

¶1In this stockholders’ derivative action brought under Section 608.131, F.S.1965, F.S.A., the court entered a judgment favorable to the plaintiffs. In the final judgment the court awarded the plaintiffs attorneys’ fees of $4500.00 and accountants’ fees of $1200.00, expressly providing that the plaintiffs would receive $3000.00 of the attorneys’ fees out of the fund which they had recovered on behalf of the corporation, but that the remaining $1500.00 of attorneys’ fees and the full $1200.00 of accountants’ fees were taxed against the defendants. The defendants appealed, their sole assignment of error directed to the court taxing against them $2700.00 of the attorneys’ fees and accountants’ fees awarded plaintiffs. The plaintiffs then cross appealed, assigning as error certain credits allowed defendants in the accounting taken by the court. We have previously denied appellants’ motion to dismiss the cross appeal. Brown v. Epstein, Fla.App. 1968, 208 So.2d 836.

¶2When an action filed on behalf of a corporation under Section 608.131, F.S.1965, F.S.A., is successful, it is proper for the court to determine and award to the plaintiffs the reasonable expenses of maintaining the action, including reasonable attorneys’ fees. Section 608.131(5), F.S.1965, F.S.A., contemplates that the amount so determined and awarded shall be paid from the fund recovered by the plaintiffs for the benefit of the corporation, whether such recovery is as a result of a judgment, compromise or settlement. This is so, because the statute expressly provides that the court may then direct the plaintiffs to account to *246the corporation for the remainder of the proceeds so received by them. There was no agreement between the parties providing for payment of the plaintiffs’ attorneys’ fees and accountants’ fees, and in the absence of statute or contract, these were not properly taxable as costs against the defendants. Shavers v. Duval County, Fla.1954, 73 So.2d 684; 8 Fla.Jur., Costs, § 33.

¶3Appellees’ cross assignments directed to various credits allowed to defendants in the accounting taken by the court have been carefully considered, but they are without merit with one exception. The court allowed a credit to the defendant Harlin Development Corporation because it had been a stockholder during the period of time covered by the accounting and thus had an equitable proportionate interest in the surplus fund recovered by plaintiffs for the corporation’s benefit. The amount of credit allowed defendant Harlin Development Corporation should have been computed on the basis of the net surplus for the years 1963, 1964 and 1965 after the common fund had been charged with the total sum of $5,700.00 which the court allowed plaintiffs as attorneys’ fees and accountants’ fees.

¶4The final judgment covered many other facets of the case of which neither party complained. The judgment is therefore affirmed in all respects except that portion awarding to plaintiffs, for and on behalf of Ambassador South, Inc., judgment against the defendants, Samuel T. Brown, Bess Brown and Harlin Development Corporation, jointly and severally, in the sum of $8,659.97, which portion of said judgment is reversed, and this cause is remanded for entry of a judgment in favor of plaintiffs as determined consistent with this opinion.

¶5Affirmed, in part; reversed, in part.

CROSS, C. J., and REED, J., concur.
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