The record in this case shows that the Tampa Publishing Company, on May 24, 1926, obtained a judgment against the Florida Cities Finance Corporation; on June 18, 1926, Miami Supply Company obtained a judgment against the Florida Cities Finance Corporation; on October 5, 1926, John Orr obtained a deficiency decree against Florida Cities Finance Corporation, and copies thereof were caused to be recorded among the public records of Dade County, Florida. The Miami Supply Company judgment was assigned to O.W. Reinders. The three suits had been instituted and were then pending in the courts against the Florida Cities Finance Corporation prior to May 21, 1926.
On May 21, 1926, E.K. Dahlman filed a bill in equity in the Circuit Court of Dade County, Florida, against Florida Cities Finance Corporation, a corporation, praying for the appointment of a Receiver, the liquidation of the corporation, and the winding up of its affairs, and Fred W. Vanderpool was appointed and qualified as such Receiver. The Receiver, under the terms of the final decrees dated May 31st and July 5th, 1928, was directed to advertise and sell the assets of the corporation and apply *Page 130 the proceeds: (a) to the expense of the receivership suit; (b) to the payment of the creditors and stockholders; (c) and to sell the real estate of the corporation free and clear of all liens except such as existed and appeared of record on May 21, 1926. The entire assets of the Florida Cities Finance Corporation were sold to Dade Developers, Inc., and paid for by a credit of the allowance for compensation made to the Receiver and his attorneys, who had assigned their claims to Dade Developers, Inc. The sale was confirmed August 13, 1928, and all persons claiming through said corporation and its Receivers since May 21, 1926, were enjoined from claiming, or attempting to claim, any right, title or interest in and to said property.
Writs of execution on the judgments, supra, were levied on the properties of the Florida Cities Finance Corporation, purchased from the Receiver by the Dade Developers, Inc., at the sale on the rule day in April, 1937. The present suit was filed to restrain the sale under the writs of execution, supra, and it was alleged that the Dahlman suit was brought for the benefit of creditors and that the judgment creditors had been made parties to that suit because of a publication order of the Court requiring creditors to present claims to the Receiver or be barred from right of recovery and the rights of the judgment creditors had been adjudicated.
An Answer was filed, testimony taken and a final decree entered on March 9, 1938, permanently enjoining John Orr, O.W. Reinders, Tampa Publishing Company, and D.C. Coleman, Sheriff of Dade County, Florida, from selling the property described in the bill of complaint, and forever quieted and confirmed the title in the plaintiff below. An appeal has been perfected to this Court and the final decree assigned as error. The final decree was reversed in the original opinion. *Page 131
On petition for rehearing it is contended that the case at bar is controlled by Knickerbocker Trust Co. v. Green Bay Phosphate Co., 62 Fla. 519, 56 So. 699. In that case a Receiver was appointed for the Phosphate Company, a private corporation, on the complaint of a stockholder, who was likewise a creditor. The Receiver was appointed, and, with the approval of the court, Receiver's Certificates were issued. There were lien creditors who were not made parties to the receivership proceedings, and the question arose whether or not the Receiver's Certificates should take priority over the judgment liens. It was held that the court had no power to authorize a Receiver of a private corporation to incur liabilities in the operation of the property and to decree that the liabilities in the operation should take priority over existing lien holders. The exact language is, viz.:
"* * * But a court of equity is not in general authorized to empower a receiver of a mere private corporation, having no duty to perform a service of a public nature, to incur liabilities in the operation of the property of the corporation and to give such liabilities priority over existing lien holders who are not parties to the receivership proceedings and have not consented to or acquiesced therein, in the absence of some special equity in favor of general creditors. Lehman v. Trust Company of America, 57 Fla. 473, 49 South. Rep. 502. See also Gregg v. Metropolitan Trust Co., 197 U.S. 183,25 Sup. Ct. Rep. 415 * * *"
The Florida Cities Finance Corporation operated the real estate development known as Fulford by the Sea, a private corporation, and the Receiver continued the business of the company by collecting on land contracts and paying operating expenses and obligations of the company, It was necessary for him to employ counsel in opposing *Page 132 a proposed mail fraud order issued, or about to issue, against the Florida Cities Finance Corporation. Counsel was employed under said order of the Court and the services were rendered by the Receiver and counsel.
We have given careful consideration to each ground of the petition for rehearing and hold that the case at bar is controlled by State, ex rel. Eppes v. Lehman, 109 Fla. 331,147 So. 907; Eppes v. Dade Developers, Inc., 126 Fla. 353,170 So. 875.
The petition for rehearing is denied.
TERRELL, C. J., and WHITFIELD and CHAPMAN, J. J., concur.
THOMAS, J., agrees to conclusion.
BROWN and BUFORD, J. J., dissent.