Case Title: EASTERN SHORES v. City of North Miami Beach

Citation: 363 So. 2d 321

Docket Number: 

State: florida

Court: Florida Supreme Court

Date: 1978-06-01T00:00:00Z

Document:
363 So. 2d 321 (1978)
EASTERN SHORES Sales Co., Petitioner,
v.
CITY OF NORTH MIAMI BEACH, Respondent.
No. 51127.

Supreme Court of Florida.
June 1, 1978.
Rehearing Denied November 7, 1978.
James E. Tribble and J. Frost Walker, III of Blackwell, Walker, Gray, Powers, Flick & Hoehl, Miami, for petitioner.
Burton B. Loebl, City Atty., North Miami Beach, for respondent.
ALDERMAN, Justice.
We grant certiorari to review the decision of the District Court of Appeal, Third District in City of North Miami Beach v. Eastern Shores Sales Company, 341 So. 2d 825 (Fla.3d DCA 1977). The Third District reversed the trial court, expressly relying upon the decision of the Fourth District in Watson v. City of Hallandale, 193 So. 2d 195 (Fla. 4th DCA 1966), cert. den. 201 So. 2d 233 (Fla. 1967). The factual situation in Watson varies materially from the facts set forth in the body of the opinion under review.[1] The Third District's reliance upon Watson creates a misapplication of law sufficient to vest jurisdiction in this Court pursuant to Article V, Section 3(b)(3), Florida *322 Constitution. Wale v. Barnes, 278 So. 2d 601 (Fla. 1973).
This case involves an annexation agreement entered into between the City of North Miami Beach and the predecessors in interest of Eastern Shores Sales Company. The determinative issue is whether the City, because of a 1957 final decree of the Circuit Court expressly upholding the validity of the agreement, is now estopped from contesting the validity of that agreement. We quash the decision of the Third District and hold that the City is collaterally estopped. We also disapprove the decision of the Fourth District in Watson.
In 1956, the City and the predecessors of Eastern Shores entered into an agreement to annex certain land to the City. The agreement provided that the City would not levy taxes against the annexed land until buildings had been constructed or revenue-producing improvements had been placed on the land. The agreement further provided:
The City filed suit in the Circuit Court seeking a declaratory decree approving the annexation and ratifying the agreement. Several resident taxpayers were permitted to intervene. These intervenors alleged that the agreement was unconstitutional.
In 1957, the Circuit Court approved the annexation and the agreement. Its final decree specifically found the agreement to be binding and, further, declared:
No appeal was taken from this decree, and after the decree became final, the City, in accordance with the agreement, annexed the land.
The Circuit Court reserved jurisdiction to enforce the terms of the agreement. In 1965, the court enforced the agreement, finding that the City was in contempt of court because it had levied taxes for the years 1961, 1962, 1963 and 1964 on Maule Lake (which is a part of the annexed land). The court ordered the City not to levy taxes on Maule Lake until a building or revenue-producing improvements are placed thereon. No appeal was taken from this order.
In 1973, Eastern Shores' land was placed on the City's tax roll, and city taxes were assessed retroactively to 1970. Eastern Shores was granted leave to intervene as a party defendant in the original 1957 law suit. The court entered an order requiring the City to show cause why it should not be held in contempt for violating the court's earlier decree. Eastern Shores alleged that no buildings had been constructed on its property nor had revenue-producing improvements been placed thereof. The City, in response, sought to be relieved from that portion of the 1957 decree that prohibits the City from taxing undeveloped land.
In its order, the trial court again held the City in contempt of court and adjudged that it could purge itself by terminating and cancelling any attempt to collect city taxes on Eastern Shores' property until buildings or revenue-producing improvements are constructed thereon. On appeal, the Third District was confronted with the issue of whether the City is estopped from contending that the agreement is unlawful. Relying on Watson v. City of Hallandale, supra, the District Court held that the City was not estopped to assert the invalidity of the 1956 judgment which would have *323 barred the assessment of taxes on Eastern Shores' property. We disagree and hold that the prior final decree is binding upon the parties to this suit.
The trial court was wrong when, in 1957, it allowed the City to contract away its taxing power relative to the undeveloped land described in the agreement.[2] This, however, is not sufficient reason now to void that portion of the final decree. In Einstein v. Davidson, 35 Fla. 342, 17 So. 563 (1895), we said:
In Aldrich v. Aldrich, 163 So. 2d 276 (Fla. 1964), we concluded:
In the present case, the trial court had "subject matter" jurisdiction;[3] therefore, the final decree, although erroneous, became binding upon the parties when no appeal was taken. Once the authority to decide has been shown, it cannot be divested by being incorrectly employed. Aldrich v. Aldrich, supra.
A distinction exists between the effect of a judgment as a bar to a second action on the same claim or demand and its effect as an estoppel in another action between the same parties on a different claim or cause of action. The difference to be drawn between these two doctrines is explained in Gordon v. Gordon, 59 So. 2d 40 (Fla. 1952):
The appropriate doctrine to be applied in this case is estoppel by judgment or collateral estoppel, which terms are used interchangeably. In the present litigation, there are issues that were not determined in the initial action, such as whether revenue-producing improvements have been placed on Eastern Shores' property and whether annual requests for tax exemptions are required to have been made. The 1957 decree did, however, unequivocally uphold the validity of the agreement between the city and the predecessors of Eastern Shores. This issue can not now be relitigated by these parties. The fact that the trial court retained jurisdiction for the purpose *324 of enforcing its decree did not make the judgment any less final or more subject to collateral attack. Finston v. Finston, 160 Fla. 935, 37 So. 2d 423 (1948).
Although all of the elements essential to the application of the doctrine of estoppel by judgment are present, the City urges that this doctrine, which produces certainty as to individual rights and gives dignity and respect to judicial proceedings, should yield to what it terms the overriding public policy against a municipality's contracting away its taxing powers. Confronted with this question in a case involving an uncontested consent decree, the Fourth District, in Watson v. City of Hallandale, supra, at 199, stated:
We reject this rationale. The fact that the decree in Watson was by consent did not make it any less conclusive or binding on the parties to the suit. Cf. Hay v. Salisbury, 92 Fla. 446, 109 So. 617 (1926); Cabinet Craft, Inc. v. A.G. Spanos Enterprises, Inc., 348 So. 2d 920 (Fla.2d DCA 1977). We therefore hold in the present case that the doctrine of collateral estoppel does apply. The constitutional validity of the annexation agreement was determined in the original declaratory judgment action, and a decree was entered which, as to the parties to this suit, became conclusive as to that issue. The decree is no less final because no appeal was taken.
Accordingly, the decision of the District Court of Appeal, Third District, is quashed; the decision of the District Court of Appeal, Fourth District, in Watson v. City of Hallandale, supra, is disapproved; and this cause is remanded for further proceedings.
It is so ordered.
OVERTON, C.J., and ADKINS, BOYD, ENGLAND and HATCHETT, JJ., concur.
SUNDBERG, J., concurs in result only.
[1]  The decree in Watson was a consent decree by stipulation of the parties, while the decree involved in the present case was the result of contested adversary proceedings.
[2]  Lykes Brothers, Inc. v. City of Plant City, 354 So. 2d 878 (Fla. 1978); City of Naples v. Conboy, 182 So. 2d 412 (Fla. 1965); St. Lucie Estates, Inc. v. Ashley, 105 Fla. 534, 141 So. 738 (Fla. 1932); Tampa Shipbuilding & Engineering Co. v. City of Tampa, 102 Fla. 549, 136 So. 458 (1931).
[3]  Ch. 87, Fla. Stat. (1955); Art. V, § 6(3), Fla. Const. (1885).