Court Opinion

ID: 72752
Source: CourtListenerOpinion
Date Created: 2010-04-26 07:43:30+00
Date Added: 2024-06-11T14:58:54.746495
License: Public Domain

PUBLISH

              IN THE UNITED STATES COURT OF APPEALS

                      FOR THE ELEVENTH CIRCUIT

                          _______________

                            No. 96-2306
                          _______________

                D. C. Docket No. 95-55-CIV-T-21-E

DWAYNE HAWKINS,
MILLARD G. RIPLEY,

                                             Plaintiffs-Appellants,

                               versus

FORD MOTOR COMPANY,

                                                 Defendant-Appellee.

                 ______________________________

          Appeal from the United States District Court
               for the Middle District of Florida
                 ______________________________
                          (March 2, 1998)

Before BIRCH, Circuit Judge, FAY,       Senior   Circuit   Judge,   and
COHILL*, Senior District Judge.

     *
      Honorable Maurice B. Cohill, Jr., Senior U.S. District Judge
for the Western District of Pennsylvania, sitting by designation.
PER CURIAM:

     CERTIFICATION          FROM    THE   UNITED

STATES    COURT    OF        APPEALS      FOR   THE

ELEVENTH CIRCUIT TO THE SUPREME COURT

OF     FLORIDA    PURSUANT       TO   ARTICLE    5,

SECTION       3(b)(6)       OF     THE    FLORIDA

CONSTITUTION.

     TO THE SUPREME COURT OF FLORIDA AND

ITS HONORABLE      JUSTICES:

     This case comes to the United States

Court of Appeals for the Eleventh Circuit

on appeal from the United States District

                        2
Court for the Middle District of Florida.

Because this case presents unresolved questions of Florida law that

are determinative of this appeal, we defer our decision pending

certification of several issues posed by the parties to the Supreme

Court of Florida. See Gossard v. Adia Services, Inc., 120 F.3d
                               1
1229, 1230 (11th Cir. 1997).       Therefore, we certify

the following question of law, based on the

background recited below, to the Supreme

Court of Florida for instruction.

                          I.       FACTS

     1
      The present case was consolidated on appeal with Morse v.
Ford Motor Co., Case No. 96-3633, also on appeal from the Middle
District of Florida. With respect to the issues of law central to
this case and on substantially similar facts, the district court
judges came to opposite conclusions. Due to a settlement agreement
between the parties, the appeal in Morse was dismissed prior to
this court's certification.

                                   3
   This case arose from the attempt of

plaintiffs, Dwayne Hawkins and Millard G.

Ripley, to purchase all the stock from the

owners of a company, Wilson Davis Ford,

Inc., which operated as a motor vehicle

dealer under a franchise agreement with

Ford    Motor   Company           ("Ford"),   a   motor

vehicle manufacturer.             The sellers of this

stock    gave   notice       of     an    intent     to

transfer ownership pursuant to Fla. Stat.

§ 320.643, and Wilson Davis Ford, Inc. gave

notice    of    an   intent         to    change    its
                         4
executive management pursuant to Fla.

Stat. § 320.644, from the sellers, Davis and

Bodiford, to the proposed purchasers of the

stock, Hawkins and    Ripley.        Ford responded

to   this   notice   by       filing     a   verified

complaint with the Florida Department of

Highway     Safety   and       Motor         Vehicles

("DHSMV")    opposing         both     the   proposed

transfer under section 320.643 and the

proposed change of management under

section 320.644.

                          5
   With respect to its opposition to the

proposed       transfer          of      stock,     Ford's

complaint alleged several deficiencies in

the financial qualifications of Hawkins

and   Ripley    and       several        performance

deficiencies         of    a      Lincoln-Mercury

dealership     in    which        Hawkins         had   an

ownership      interest;         these    deficiencies,

according      to    Ford,       rendered         Hawkins

ineligible     to    meet        Ford's    reasonable

standards      for    executive       management.

With respect to the proposed change of
                             6
management,           Ford's     complaint       alleged

these same deficiencies.

     Following the filing of Ford's complaint

in the DHSMV, the contract to sell the stock

was terminated and the administrative

proceeding      was       dismissed        as     moot.

Plaintiffs subsequently brought this action

in federal district court and alleged, inter

alia,   that   Ford    had     violated   Fla.   Stat.   §

320.643, in opposing the transfer of equity

to   Hawkins    and     Ripley     by   means      of    a

complaint that was facially deficient.
                             7
           II.    CONTENTIONS

   Hawkins and Ripley submit that by its

express provisions, notwithstanding the

terms of a franchise agreement, Fla. Stat.

§ 320.643(2)(a) governs the prospective

transfer of shares in a motor vehicle

dealership. Under this section, according to

the plaintiffs, Ford could object to such a

transfer   only    on       the   basis   that   the

proposed transferee was not of good moral

character. Ford's verified complaint did not

allege that either Hawkins or Ripley was
                        8
not of good moral character. Consequently,

because Ford's complaint did not oppose the

transfer on grounds permitted by section

320.643(2)(a), Ford's complaint was facially

insufficient and Ford's opposition was in

violation of the statute.     Ford argues

that in the case of a proposed complete

transfer of equity interest leading also to

a change of executive management, the

practical effect of such a transfer will be

the transfer of the franchise agreement.

Ford suggests that the Florida Dealer Act
                     9
read as a whole, giving full effect to all

statutory            provisions,                permits

consideration of business qualifications as

well   as    moral    character        of   a      proposed

transferee where the proposal at issue is

to transfer 100% of the stock to a third

party.      Ford further urges that a proposed

transfer of a franchise agreement is

regulated     by     the   terms       of   Fla.    Stat.   §

320.643(1),    under       which   a   manufacturer

may object to a proposed transfer on

grounds       that    the     transferee           is   not
                             10
financially qualified or does not meet a

manufacturer's         uniformly        applied

reasonable   standards       or   qualifications

with respect to executive management.

Consequently,   Ford        contends   that   it

properly could object to the management

experience and financial qualifications

of Hawkins and Ripley, as it did in its

verified complaint to the DHSMV.

   In the trial court in this case, the

district court agreed with Ford and held as

a matter of law that "when transfer of
                       11
100%      of    stock     is    contemplated,       the

provisions           regarding    transfer     of     a

franchise        agreement        and    change      in

executive       management          control       should

apply."        The   district    court   reached    the

opposite legal conclusion with respect to

Morse, however, and determined that only

section        320.643(2)(a)       applies   to     the

proposed transfer of 100% of the stock and,

as a result, that only moral character may

be considered as grounds for an objection

to such a transfer.
                           12
     III.      QUESTION TO BE CERTIFIED

     Does Fla. Stat. § 320.643(2)(a) provide

     the exclusive basis               for objection by a

     motor        vehicle       manufacturer               to   the

     proposed transfer of all the equity in

     interest in a motor vehicle dealership?

     Our statement of the question to be certified is intended as a

guide and is not meant to restrict the scope of inquiry by the

Supreme Court of Florida. The entire record of this case, together

with copies of the briefs, shall be transmitted to the court.

QUESTION CERTIFIED.

                                  13