Proctor, Sol H.

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University of Florida Levin College of Law

Florida Law Review Volume 4 Issue 1 Article 10 March 1951 Corporations: Proceeding Against a Dissolved Corporation Sol H. Proctor Follow this and additional works at: https://scholarship.law.ufl.edu/flr  Part of the Law Commons Recommended Citation Sol H. Proctor, Corporations: Proceeding Against a Dissolved Corporation, 4 Fla. L. Rev. 104 (1951). Available at: https://scholarship.law.ufl.edu/flr/vol4/iss1/10 This Article is brought to you for free and open access by UF Law Scholarship Repository. It has been accepted for inclusion in Florida Law Review by an authorized editor of UF Law Scholarship Repository. For more information, please contact kaleita@law.ufl.edu. DATE DOWNLOADED: Mon Aug 22 16:27:36 2022SOURCE: Content Downloaded from HeinOnlineCitations:Bluebook 21st ed.			                                                                Sol H. Proctor, Corporations: Proceeding against a Dissolved Corporation, 4 U. FLA.L. REV. 104 (1951).                                                                  ALWD 7th ed.                                                                         Sol H. Proctor, Corporations: Proceeding against a Dissolved Corporation, 4 U. Fla.L. Rev. 104 (1951).                                                                  APA 7th ed.                                                                          Proctor, S. H. (1951). Corporations: proceeding against dissolved corporation.University of Florida Law Review, 4(1), 104-105.                                     Chicago 17th ed.                                                                     Sol H. Proctor, "Corporations: Proceeding against a Dissolved Corporation,"University of Florida Law Review 4, no. 1 (Spring 1951): 104-105                     McGill Guide 9th ed.                                                                 Sol H. Proctor, "Corporations: Proceeding against a Dissolved Corporation" (1951) 4:1U Fla L Rev 104.                                                                     AGLC 4th ed.                                                                         Sol H. Proctor, 'Corporations: Proceeding against a Dissolved Corporation' (1951)4(1) University of Florida Law Review 104                                            MLA 9th ed.                                                                          Proctor, Sol H. "Corporations: Proceeding against a Dissolved Corporation."University of Florida Law Review, vol. 4, no. 1, Spring 1951, pp. 104-105.HeinOnline.                                                                          OSCOLA 4th ed.                                                                       Sol H. Proctor, 'Corporations: Proceeding against a Dissolved Corporation' (1951) 4 UFla L Rev 104Provided by: University of Florida / Lawton Chiles Legal Information Center-- Your use of this HeinOnline PDF indicates your acceptance of HeinOnline's Terms and    Conditions of the license agreement available at https://heinonline.org/HOL/License-- The search text of this PDF is generated from  uncorrected OCR text.-- To obtain permission to use this article beyond the scope of your  license, please use:Copyright Information1Proctor: Corporations: Proceeding Against a Dissolved CorporationPublished by UF Law Scholarship Repository, 1951UNIVERSITY OF FLORIDA LAW REVIEWCORPORATIONS: PROCEEDING AGAINST ADISSOLVED CORPORATIONNeville v. Leamington Hotel Corp., 47 So.2d 8 (Fla. 1950)In December 1946 plaintiff brought a common law action againstdefendant in its corporate name to recover a real estate brokeragecommission. Defendant, which was solvent, had been voluntarilydissolved in November, 1945, but its existence had been continued,pursuant to statute,' for a period of three years for the sole purpose ofwinding up its affairs, including prosecuting and defending suits. Thelower court granted a motion to dismiss, whereupon plaintiff unsuc-cessfully moved to substitute the trustees and directors of the corpora-tion as defendants. On certiorari, HE=D, the trustees of a dissolvedcorporation may be sued, even though the proceeding is not pendingat disolution. Judgment reversed, Justice Thomas dissenting.This case involves three closely related problems: first, the amena-bility of a corporation to suit after dissolution; second, the applicablestatutory provisions; and third, the party to be named as defendant.The first of these, which requires somewhat fuller treatment, is dis-cussed last.Under Section 612.50 of Florida Statutes 1949 the circuit court,sitting in chancery, may upon the application of any creditor orstockholder of the corporation continue its directors as trustees, oralternatively appoint a receiver, for the purpose of winding up itsaffairs. For such purpose their powers may be continued for as longas the chancellor deems necessary. In the instant case the Courtrejected the application of this provision, for the reason that its wholetenor indicates that it should be limited to corporations in a precariouscondition. Only when the exigencies of the situation, such as in-solvency, actual fraud, or mismanagement amounting to fraud,2 de-mand is the appointment of a receiver proper.The sections applicable to a solvent corporation able to liquidateits affairs are 612.47, which continues the corporate life for threeyears for orderly settling of affairs; 612.48, which automaticallyrenders the directors trustees for this purpose; and 612.49, 3 which'FLA. STAT. §612.47 (1949).2 McAllister Hotel, Inc. v. Schatzberg, 40 So.2d 201 (Fla. 1949).3 "The persons constituted trustees . .'. may sue for and recover the debts andproperty, by the name of the trustees of such corporation, describing it by its2Florida Law Review, Vol. 4, Iss. 1 [1951], Art. 10https://scholarship.law.ufl.edu/flr/vol4/iss1/10CASE COMMENTSauthorizes suit by and against the trustees in their name as suchtrustees.4This last provision gives the answer to the third problem posed,namely, the party to be sued. In this connection Section 612.58 ispertinent by analogy. It proscribes abatement of an action pendingat dissolution, and provides for the filing of a suggestion of dissolu-tion. Service of notice thereof should be made upon the trustees orreceivers, or, when service on them is impracticable, upon counsel ofrecord, whereupon ".... said action shall proceed to final judgmentagainst the said trustees or receivers by the name of the corporation."Under the corresponding provisions governing banks and similarcorporations, a suit against the trustees has been held proper.5Although New York has interpreted its similar statute6 as requiringsuit against the corporation itself,7 other states construe their cor-responding statutes8 to prescribe a caption naming certain individualsas trustees of the corporation involved.9In the instant case the Florida Supreme Court directed reinstate-ment of a common law action commenced after the dissolution of thedefendant corporation. Furthermore, interlocutory certiorari, whichapplies in equity only,10 was granted. The strong indication is thatsuch a proceeding should be brought in equity, and that in anyevent the trustees should be named as defendants, while an action orsuit pending at dissolution should proceed in the manner specified inSection 612.58.Turning now to the first problem, it is well settled that afterdissolution of a corporation a party may proceed against it in accord-ance with the statutes extending its life." At common law a pendingcorporate name, and shall be suable by the same name for the debts owing bysuch corporation at the time of its dissolution .. "4See generally FLA. STAT. §§611.81, 611.32, 611.34 (corresponding provisionsfor banks, insurance companies, etc.); 610.16-610.18 (continuance after dissolu-tion for failure to pay taxes or file reports).5Megdall v. Scott Corp., 40 So.2d 139 (Fla. 1949).6N.Y. Gmiq. Conp. LAw §29 (1940).70'Neil v. American Radiator Co., 43 F. Supp. 543 (S.D.N.Y. 1942); Cunning-ham v. Glauber, 133 App. Div. 10, 117 N.Y. Supp. 866 (1st Dep't 1909).8E.g., ALA. CODE ANx. tit. 10, §110 (1940); Ox. Covw. LAws ANN. §77-259(1939).948th Street Inv. Co. v. Fairfield-American Nat. Bank, 223 Ala. 44, 134 So. 803(1931); Black v. Sullivan Timber Co., 147 Ala. 327, 40 So. 667 (1906); DundeeMtge. & Trust Inv. Co. v. Hughes, 77 Fed. 855 (D. Ore. 1896).0BR. PAc. Sup. CT. FLA. 34."See 16 FLErcHER, CouonAxoNs §8143 (rev. ed. 1942).3Proctor: Corporations: Proceeding Against a Dissolved CorporationPublished by UF Law Scholarship Repository, 1951

Corporations: Proceeding Against a Dissolved Corporation

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Corporations: Proceeding Against a Dissolved Corporation

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