Court Opinion

ID: 3183937
Source: CourtListenerOpinion
Date Created: 2016-03-09 16:19:44.067239+00
Date Added: 2024-06-11T14:08:29.493685
License: Public Domain

Third District Court of Appeal
                                State of Florida

                           Opinion filed March 9, 2016.
         Not final until disposition of timely filed motion for rehearing.

                               ________________

                                No. 3D14-1836
                            Consolidated: 3D14-1512
                          Lower Tribunal No. 08-78374
                              ________________

  David Houri, Skyrise Development Group, Inc., Financial Ocean
   Services, LLC, Realty Advise LLC and Central Florida Hotel
                       Management, LLC,
                                    Appellants,

                                          vs.

                              Mordechai Boaziz,
                                     Appellee.

      Appeals from the Circuit Court for Miami-Dade County, Herbert Stettin,
Senior Judge.

     Philip D. Parrish, for appellants.

     Moskowitz, Mandell, Salim & Simowitz, Michael W. Moskowitz and Scott
M. Zaslav, (Fort Lauderdale), for appellee.

Before WELLS, ROTHENBERG and EMAS, JJ.
      WELLS, Judge.

      Plaintiff, Mordechai Boaziz, sued Defendants, Yizhak Toledano and David

Houri, as well as a number of entities owned either individually or jointly by these

two,1 seeking to recover millions of dollars in damages for their alleged breach of

fiduciary duties, fraud, and civil conspiracy in connection with three real estate

projects: The Residence Las Vegas condominium conversion; the Villaggio on the

Lakes condominium conversion; and a transaction involving real property in

Golden Isles (the Golden Isles project). Boaziz also claimed violations of Florida’s

Uniform Fraudulent Transfer Act with respect to The Residence Las Vegas and

Villaggio projects.

      The crux of Boaziz’s action, as set out in his Third Amended Complaint,

was that he, Toledano, and Houri were engaged in a joint venture and while he was

distracted by the worsening health of his elderly parents, Toledano and Houri had

deliberately set out to take advantage of the trust and confidence reposed in them,

and had devised and carried out an elaborate scheme by which they fraudulently

transferred and concealed millions of dollars generated in connection with these

projects.

1Toledano owns and used FCI and 26 Realty in his real estate transactions. Houri
owns Financial Ocean Services, LLC (“FOS”) and controls Realty Advice, LLC.
Toledano and Houri formed Skyrise Development Group, Inc. (“Skyrise”) to
engage in real estate transactions.

                                         2
      The following facts relating to the three projects at issue are relatively

uncontested and straight forward.

             The Residence Las Vegas Condominium Conversion Project

      This project commenced on November 1, 2004, when Boaziz, an

experienced developer with dozens of condominium conversions under his belt,

personally executed a $55,000,000 contract to purchase a 504 unit apartment

complex in Las Vegas, Nevada.         The following March, Boaziz assigned this

contract to a Nevada limited liability company, The Residence Las Vegas, LLC—

an entity in which Skyrise Development Group, Inc. was to hold an 83.34%

interest and in which Boaziz was to hold a 16.66% interest.

      Six weeks after the contract was assigned to The Residence Las Vegas,

LLC, its members, Skyrise and Boaziz, executed an operating agreement to govern

“the purchase, development, operation, management, marketing and resale” of this

project. This operating agreement, accorded management oversight and control of

the Las Vegas project to Skyrise, the LLC’s majority member, and clearly stated

that the parties understood and agreed that all prior representations and

understandings by and between the parties were encompassed within the operating

agreement and that the operating agreement encompassed the entire agreement

between the parties with regard to this project:

             Section 14.3 Integration. This Operating Agreement sets forth
      all (and is intended by all parties herein to be an integration of all) of

                                          3
      the promises, agreements, conditions, understandings, warranties and
      representations among the parties hereto with respect to the Company,
      the Company business and the property of the Company, and there are
      no promises, agreements, conditions, understanding, warranties, or
      representations, oral or written, express or implied, among them other
      than as set forth herein.

             Section 14.8 Entire Agreement, Etc. This agreement (together
      with the Exhibits hereto, or agreements provided for herein, which
      constitute a part hereof, and the other documents delivered pursuant
      hereto) constitutes the entire agreement of the parties hereto with
      respect to the subject matter hereof and supersedes all prior
      agreements and understandings of the parties with respect to the
      subject matter hereof.

      Approximately one month after signing this operating agreement, Skyrise

and Golan Equity Management, LLC, an entity owned by Boaziz, executed another

operating agreement relating to this project. The stated purpose of this agreement

was to form and operate a Florida limited liability company, The Residence

Florida, LLC, to either develop, operate, manage, market, and resell real property

or to acquire an interest in other entities which were engaged in such activities,

more specifically the Nevada limited liability company’s interest in the Las Vegas

condominium conversion project.

      This operating agreement, like the operating agreement governing the

Nevada limited liability company, identified the same two members: Skyrise (an

entity owned by Houri and Toledano) with an 83.34% interest and Golan (an entity

owned by Boaziz) with a 16.66% interest. And like the operating agreement

governing the Nevada limited liability company, this agreement represented that it

                                        4
encompassed the entire agreement between the parties and that all prior

representations and understandings between the parties were encompassed within

the agreement.

      After this agreement was executed, the parties amended the operating

agreement for the Nevada limited liability company, The Residence Las Vegas,

LLC, to reflect that Skyrise and Boaziz no longer were members but that now the

sole member of the Nevada company was The Residence Florida, LLC (an entity

whose members were Skyrise and Golan). The amended operating agreement, like

the two operating agreements before it, included the same integration clause and a

clause regarding the entirety of the parties’ understanding.

      Purchase of the Las Vegas apartment complex was closed on June 25, 2005.

              Villaggio on the Lakes Condominium Conversion Project

      This project commenced in January 2005, when Houri and Toledano

identified a potential condominium conversion project in Florida, the Villaggio on

the Lakes project. In March 2005, Villaggio on the Lakes Development, LLC was

formed to purchase the Villaggio Lakes property.          The sole member of this

company is Villaggio Holdings, LLC, an entity owned equally by Boaziz, Houri,

and Toledano individually. The operating agreements for both Villaggio on the

Lakes Development, LLC and Villaggio Holdings, LLC expressly state their

purpose as the purchase and development of the Villaggio Lakes condominium

                                          5
conversion project, and like the agreements made with regard to The Residence

Las Vegas conversion, include identical or virtually identical integration clauses

and provisions regarding the entirety of the understanding between the parties.

                                 The Golden Isles Project

      The Golden Isles project involved the purchase of property in Hallandale

Beach, Florida. Boaziz located the property and invited Houri and Toledano to be

equal partners with him in the purchase and resale of the property. In October

2004, Boaziz, Houri, and Toledano purchased the property in Golden Isles for

$3,500,000. Unlike the Residence Las Vegas project or the Villaggio on the Lakes

project, no operating or other written agreements were ever executed by the parties

with regard to this project.

                                 The Claims Made Below

      Claiming the existence of an overarching joint venture agreement, Boaziz

alleged, with regard to The Residence Las Vegas project, that Toledano and Houri

breached fiduciary duties owed to him, conspired to commit fraud, and defrauded

him first by getting him to agree to take less than a one third interest in this venture

and then later by diverting funds from the project to themselves or entities

controlled by them. Boaziz also claimed that by committing these acts, Toledano

and Houri and the entities controlled by them violated Florida’s Uniform

Fraudulent Transfer Act.2

                                           6
      Again claiming a joint venture, Boaziz alleged as to the Villaggio on the

Lakes project, that Toledano and Houri had breached fiduciary duties owed to him,

conspired to commit fraud, and defrauded him by diverting funds to themselves or

entities controlled by them. He similarly claimed violation of Florida’s Fraudulent

Transfer Act as a consequence of these actions on the part of Toledano, Houri and

entities controlled by them.3

      As to the Golden Isles project, Boaziz, claiming a joint venture, alleged that

Toledano and Houri breached fiduciary duties owed to him and that they had

conspired to defraud and had defrauded him.4

                                  The Final Judgment

2 The claims as to The Residence Las Vegas were: breach of fiduciary duty against
Toledano (Count I) and Houri (Count II); fraud against Toledano and Houri (Count
III); civil conspiracy against Toledano and Houri (Count IV); and violation of
Florida’s Uniform Fraudulent Transfer Act against Toledano, Houri, Skyrise, FCI,
FOS, 26 Realty, and Realty Advice, LLC (Count V).
3 The claims as to Villaggio were: breach of fiduciary duty against Toledano
(Count IX) and Houri (Count X); fraud against Toledano and Houri (Count XI);
civil conspiracy against Toledano and Houri (Count XI [sic]); and violation of
Florida’s Uniform Fraudulent Transfer Act against Toledano, Houri, Central
Florida Hotel Management, LLC (“CFHM”), Skyrise, 26 Realty, and Realty
Advice (Count XIII).
4 The claims as to Golden Isles were: breach of fiduciary duty against Toledano
(Count V [sic]) and Houri (Count VI); fraud against Toledano and Houri (Count
VII); and civil conspiracy against Toledano and Houri (Count VIII).

                                         7
      The trial court found the parties were joint venturers in all three projects.

Without barely a mention of the parties’ numerous written agreements, the court

below found that Houri individually had breached duties owed to Boaziz, had

conspired to commit fraud, and had defrauded Boaziz with regard to all three

projects. The court below also found that Houri had fraudulently transferred funds

from the Las Vegas project to one of his companies, FOS, and that since Houri was

the “alter ego” of FOS, both he and it were liable to Boaziz. The court similarly

found that Houri had fraudulently transferred funds from the Villaggio project to

Skyrise and another of his companies, Realty Advice, LLC, and assessed damages

against Houri individually and against these companies on this claim as well.

      Judgment5 was entered against Houri personally for breach of fiduciary duty,

fraud, and civil conspiracy with regard to his actions as they related to all three real

estate projects. Judgment also was entered against Houri personally for violating

Florida’s Uniform Fraudulent Transfer Act with regard to his actions as they

related to The Residence Las Vegas and the Villaggio projects.               Likewise,

judgment was entered against FOS and Realty Advice, LLC, two entities owned by

Houri, as well as against Skyrise, a dissolved corporation owned by both Houri and

Toledano, finding FOS liable for violating Florida’s Uniform Fraudulent Transfer

5 The original final judgment executed on February 7, 2014, was amended on July
24, 2014, and incorporates the findings of fact and conclusions of law detailed in
the February 7 final judgment.

                                           8
Act with regard to The Residence Las Vegas project, and Skyrise and Realty

Advice liable for violating Florida’s Uniform Fraudulent Transfer Act with regard

to the Villaggio project.

        Damages in the amount of $38,000,0006 were awarded against these

defendants, with over $20,000,000 of that sum being assessed against Houri

individually. Pursuant to a stipulation between the parties that no judgment would

be entered in excess of $5,000,000, an amended final judgment was entered

reducing the damage awards against Houri and FOS to $4,100,000 each, and in

total, to account for a $900,000 settlement from Toledano.7, 8

       Houri and his associated companies appeal, claiming in substantial part that

the express provisions of the written agreements entered by the parties preclude

most, if not all, of the awards entered below.         Because we agree that the

agreements governing The Residence Las Vegas and Villaggio projects preclude

6The   Final Judgment awards including pre-judgment interest were:

Against Houri:              $21,549,490.58
Against FOS:                $14,897,664.00
Against Skyrise:            $ 1,450,698.17
Against Realty Advice:      $    71,143.58
7Before trial, Boaziz settled for $900,000 with Toledano and the two entities,
Florida Capital Investments, LLC (“FCI”), and 26 Realty, LLC, controlled by
Toledano.
8The parties further stipulated that Boaziz’s total recovery would be limited to this
amount whether collected from any one or any combination of the defendants.

                                         9
liability from being assessed against Houri individually, we reverse the damage

awards assessed against him with regard to those entities. We also reverse the

judgment entered against FOS on The Residence Las Vegas project and the

judgment against Skyrise and Realty Advice on the Villaggio project, because, as a

matter of law, those entities could not be held legally accountable for violating

Florida’s Uniform Fraudulent Transfer Act.          We do, however, affirm those

portions of the final judgment against Houri individually for breach of fiduciary

duty, fraud, and civil conspiracy, as to the Golden Isles project.

      Houri’s Individual Liability as to The Residence Las Vegas Project

a. Breach of Fiduciary Duty, Fraud, Civil Conspiracy, Violation of FUFTA

      The Final Judgment against Houri individually as it relates to The Residence

Las Vegas project is predicated on the trial court’s determination that he,

Toledano, and Boaziz were engaged in a joint venture relationship and as a

consequence Houri owed his fellow joint venturers a fiduciary duty to act in good

faith. See Reaves v. Hembree, 330 So. 2d 747, 749 (Fla. 1st DCA 1976) (“There is

a fiduciary relationship between joint venturers. They owe each other the utmost

good faith, fairness, and honesty.”). The record is clear however, that in the instant

case, the three men at the center of this controversy—Houri, Toledano and

Boaziz—instead of proceeding as a joint venture, from the beginning, chose to set

out the parameters of their relationship and its accompanying obligations through

                                          10
the creation of a series of limited liability companies with governing operating

agreements. See Florida Tomato Packers v. Wilson, 296 So. 2d 536, 539 (Fla. 3d

DCA 1974) (“A joint venture has been defined as a special combination of two or

more persons, who, in some specific venture seek to profit jointly without the

existence between them of any actual partnership, corporate, or other business

entity.”); accord Florida Trading & Inv. Co. v. River Const. Servs., Inc., 537 So.
2d 600, 602 (Fla. 2d DCA 1988); see generally Creation of Joint Venture, 9 Fla.

Pl. & Pr. Forms § 72:1 (“A joint venture is a special combination of two or more

persons jointly seeking a profit in some specific venture, without any actual

partnership, corporation, or other business entity.” (footnotes omitted)).

      While the agreements entered by the parties could not eliminate a general

duty of good faith, see § 608.2445, Fla. Stat. (2004), they could and did otherwise

dictate the nature of their relationship and the obligations each owed to the others.

For as we observed in Dinuro Investments, LLC v. Camacho, 141 So. 3d 731, 742-

43 (Fla. 3d DCA 2014), “limited liability is one of the paramount reasons for

forming an LLC.” Here, it is precisely those layers of protection from personal

liability accorded by the parties’ agreements that preclude Boaziz from recovering

from Houri, individually.

   As reflected in The Residence Las Vegas, Nevada operating agreement, this

project was to be pursued by Skyrise (not Houri individually) and Boaziz, with

                                         11
Skyrise acting as the project’s sole managing member. The Residence Florida

agreement also was created by and between Skyrise (again not Houri) and Golan

Equity Management, and like the Nevada agreement confirmed that this project

was to be pursued by its two members: Skyrise and Golan. It was this entity,

comprised of Skyrise and Golan, which ultimately became the sole member of The

Residence Las Vegas.9 Thus, Skyrise as managing member of The Residence Las

Vegas owed a duty of loyalty and a duty of care to its sole member The Residence

Florida. See § 608.4225, Fla. Stat. (2004). Houri was not, therefore, a player in

this game at all, other than being a part owner of Skyrise.

      Nowhere in Boaziz’s 45-page complaint did Boaziz seek to pierce either

Skyrise’s corporate veil or, for that matter, the corporate veil of any of the other

limited liability companies that he, Toledano, and Houri created. “The law is clear

that the mere ownership of a corporation by a few shareholders, or even one

shareholder, is an insufficient reason to pierce the corporate veil. ‘[E]ven if a

corporation is merely an alter ego of its dominant shareholder or shareholders, the

corporate veil cannot be pierced so long as the corporation’s separate identity was

lawfully maintained.’” Gasparini v. Pordomingo, 972 So. 2d 1053, 1055 (Fla. 3d

DCA 2008) (quoting Lipsig v. Ramlawi, 760 So. 2d 170, 187 (Fla. 3d DCA

9 Similarly, each of the other two agreements governing this project name
Skyrise—not Houri—as manager and accord that entity broad management and
control authority.

                                         12
2000)); Dania Jai-Alai Palace, Inc. v. Sykes, 450 So. 2d 1114, 1120 (Fla. 1984)

(“The mere fact that one or two individuals own and control the stock structure of a

corporation does not lead inevitably to the conclusion that the corporate entity is a

fraud or that it is necessarily the alter ego of its stockholders to the extent that the

debts of the corporation should be imposed upon them personally.”) (quoting

Advertects, Inc. v. Sawyer Indus., Inc., 84 So. 2d 21, 23 (Fla.1955)). With no

claims propounded and no determination made that Skryise’s corporate identity

should be disregarded, no judgment against Houri personally could be assessed for

breach of fiduciary duty, fraud, or conspiracy as to this project.

b. Boaziz’s Fraudulent Inducement and Fraud Claims

      We further reject Boaziz’s claim that he is entitled to a judgment against

Houri individually for fraudulently inducing him to reduce what was to be his one

third interest in the project by half to take only a 16.66% interest. We do so first

because each of the documents executed by Boaziz establish that this project

always was contemplated to be between Skyrise and Boaziz or one of Boaziz’s

entities and not between Skyrise’s principals (Houri and Toledano) and Boaziz.

Early on, at least six weeks before Boaziz surrendered one half of his contemplated

interest in this project, he assigned the contract in which he was to be the sole

purchaser of the Las Vegas apartment complex to The Residence Las Vegas,

LLC—an entity with two members, Skyrise and Boaziz. The document evidencing

                                          13
the assignment was not signed by Houri but by Toledano as president of Skyrise

Development Group, Inc. as managing member of The Residence Las Vegas, LLC.

Six weeks after this assignment, Boaziz received a check from Skyrise

Development Group, Inc., the manager of the project, bearing the notation “sale of

16.66% of Canyon Lake, NV.” Boaziz subsequently executed three operating

agreements governing the purchase, ownership, development, management of the

Las Vegas property, each of which established that the participants in this project

were Skyrise and Boaziz. As all of this confirms, at all times, Boaziz was fully

aware that as he was dealing with Skyrise and not Houri personally on this project.

     Here, as with his other claims relating to this project, Boaziz neither sought to

secure nor secured any relief from Skyrise for fraudulently inducing him to

decrease his interest in The Residence Las Vegas project. Rather, Boaziz’s entire

fraudulent inducement claim rests on acts purportedly performed by Houri

individually.

    A corporation can, of course, act only through its agents. See Morgan Int’l

Realty, Inc. v. Dade Underwriters Ins. Agency, Inc., 617 So. 2d 455, 459 (Fla. 3d

DCA 1993) (“[I]it is well established ‘that a corporation can only act through its

officers and agents.’ Browning v. State, 101 Fla. 1051, 1054, 133 So. 847, 848

(1931).”). And, as already stated, simply acting on behalf of a corporation or

owning most or all of its shares does not subject a corporate representative or

                                         14
shareholder to individual liability. See Gasparini, 972 So. 2d at 1055. Since

Boaziz did not allege a basis on which Skyrise’s corporate identity could be

disregarded, and since no basis for doing so was found by the court below,

judgment could not be assessed against Houri personally on these claims.

c. Boaziz’s FUFTA Claims

     For the same reason, liability could not be assessed against Houri on count V

of the complaint for violation of Florida’s Uniform Fraudulent Transfer Act.

Absent a determination that Skyrise engaged in fraudulent transfers, and a

determination that evidence existed to support piercing its corporate veil, liability

could not be assessed against either FOS or Houri as the “alter ego” of FOS for

receiving a fraudulent transfer. We therefore reverse the judgment on count V

against Houri and FOS for violating Florida’s Uniform Fraudulent Transfer Act.

d. Conclusion

     In sum, the multi-layered limited liability companies and their operating

agreements outlined herein (created in part by Boaziz himself), with Houri

personally neither a member nor a manager, and with many of the claims

addressing injury to the limited liability companies rather than Boaziz himself, all

preclude recovery by Boaziz from Houri, individually. Accordingly, the judgment

against Houri individually on counts II for breach of fiduciary duty, III for fraud,

IV for civil conspiracy, and V for violation of Florida’s Uniform Fraudulent

                                         15
Transfer Act, all related to The Residence Las Vegas project, are reversed.

Similarly, the judgment against FOS on count V for violation of Florida’s Uniform

Fraudulent Transfer Act is reversed.

             Houri’s Individual Liability as to the Villaggio Project

a. Breach of Fiduciary Duty, Fraud, Civil Conspiracy, Violation of FUFTA

     Here, as with The Residence Las Vegas project, the finding of a joint venture

cannot be the premise for a recovery by Boaziz. The parties’ written agreements

confirm that the parties intended to operate this project, as they did with regard to

The Residence Las Vegas, pursuant to written agreements, through a series of

limited liability companies. See Florida Tomato Packers, 296 So. 2d at 539;

accord   Florida Trading & Inv. Co., 537 So. 2d at 602. Also, as was the case with

the Las Vegas project, Boaziz made no attempt to pierce the corporate veil of the

entities he had helped form, and thus was bound by the limitations to liability those

entities created. See Dania Jai-Alai Palace, Inc., 450 So. 2d at 1120.

     Moreover, because of the agreements in place, Boaziz could not recover on

claims that Houri improperly diverted funds from the Villaggio project to entities

that Houri owned or controlled (Skyrise and Realty Advice).10 This is so because

Boaziz had no ownership interest to protect in Villaggio on the Lakes

10Although Boaziz also sought to impose liability on FOS in the counts relating to
the Villaggio project, no liability was assessed in the final judgment against this
entity, in connection with that project.

                                         16
Development, LLC, the entity that “purchased, developed, operated, marketed,

maintain[ed]/ and or [sold] the parcels of real property”11 at issue here. To the

contrary, that entity was wholly owned not by Boaziz, Toledano, and Houri but

solely by Villaggio Holdings, LLC. Thus, it was to that entity, Villaggio Holdings,

that a duty of care was owed. see § 608.2445, Fla. Stat. (2005).

      This action was not, however, brought by Villaggio Holdings, LLC, the

“injured” party, but individually by Boaziz (one of the three members of that

entity). “Generally, a shareholder cannot sue in the shareholder’s name for injuries

to a corporation unless there is a special duty between the wrongdoer and the

shareholder, and the shareholder has suffered an injury separate and distinct from

that suffered by other shareholders.” Braun v. Buyers Choice Mortg. Corp., 851
So. 2d 199, 203 (Fla. 4th DCA 2003); see also Dinuro, 141 So. 3d at 738

(confirming that a shareholder may bring suit to address an injury separate and

distinct from that sustained by other stockholders, however, if the injury is

primarily against the corporation, then the action belongs to the corporation).

      In this case, any “wrongdoer” was one or more of three managing members

of a wholly owned subsidiary company, Villaggio on the Lakes Development,

whose purported wrongs resulted in injury to its sole shareholder/member,

Villaggio Holdings LLC, its parent holding company. As one of three members of

11This statement was in the recitals portion of the Villaggio on the Lakes
Development, LLC Operating Agreement.

                                         17
that entity (Villaggio Holdings), Boaziz only suffered a harm that flowed from an

initial harm to Villaggio Holdings. He was, therefore, without authority to bring

this action directly, and certainly could not tag Houri, individually. Thus, and

primarily, this action was brought against the wrong party—Houri, individually,

rather than the LLC responsible for the wrongs alleged. Additionally, the action

was brought by the wrong party—Boaziz—rather than the LLC, he and his

business cohorts had created to be the sole owner of the Villaggio on the Lakes

Development. With no effort to pierce the corporate shields carefully erected by

these parties, the trial court was not at liberty to ignore the corporate entities they

had chosen to employ to conduct their business. See Dania Jai-Alai Palace, Inc.,
450 So. 2d at 1120. Either or both of these errors support the conclusion we reach

herein.

   b. Fraud in the Inducement

      We write separately to address a claim similar to that made as to the Las

Vegas Project—that but for Houri’s (and Taledano’s) mis-statements, Boaziz

would have struck a better deal for himself.          Here, Boaziz claims he was

fraudulently induced to contribute most of the equity to the Villaggio project but

accept only a 33% interest in the project. To establish fraud in the inducement,

Boaziz had to allege and prove (1) that Houri made a statement concerning a

material fact; (2) that he knew or should have known was false when made; (3) that

                                          18
he intended that Boaziz act on his false statement; and (4) that Boaziz reasonably

acted thereon and was damaged as a result. See Gimini Inv’rs III, L.P. v. Nunez,

78 So. 3d 94, 97 (Fla. 3d DCA 2012); see also Rhodes v. O. Turner & Co., LLC,

117 So. 3d 876 (Fla. 4th DCA 2013) (stating the element of fraud as (1) a false

statement of specific material fact; (2) known to be false when made; (3) made for

the purpose of inducing reliance; and (4) on which another justifiably relied to his

detriment). While a fraudulent statement generally must concern a past or existing

fact, a promise to act in the future may be actionable if made with no intention of

performing. Id.; Mejia v. Jurich, 781 So. 2d 1175, 1177 (Fla. 3d DCA 2001)

(confirming that an action for fraud usually must be predicated on a statement

concerning a past or existing fact, however, “if the plaintiff can demonstrate that

the person promising future action does so with no intention of performing or with

a positive intention not to perform”).

      Fraud must be pled with particularity and must not only specifically identify

a misrepresentation of fact but also identify when, where, or the manner in which it

was made. Cedars Healthcare Grp., Ltd. v. Mehta, 16 So. 3d 914, 917 (Fla. 3d

DCA 2009) (“The factual basis for a claim of fraud must be pled with particularity

and must specifically identify misrepresentations or omissions of fact, as well as

time, place or manner in which they were made”); Robertson v. PHF Life Ins. Co.,

702 So. 2d 555, 556 (Fla. 1st DCA 1997) (“Florida Rule of Civil Procedure

                                         19
1.120(b) requires that allegations of fraud be pled with specificity” and must

identify the time, place or manner in which the representations were made).

      Count XI alleging fraud in the inducement against Houri as to the Villaggio

project satisfies none of these requirements. In its entirety, the complaint as to this

claim states only that at some unspecified time and under some unidentified

circumstances, Houri “misrepresented” that he and Boaziz were making the same

contribution to this project for the same interests:

             As described above, Toledano and Houri each misrepresented
      to Boaziz that each partner and co-venturer would make equal equity
      contributions to the Villaggio Project so that Boaziz would agree to
      take only a 1/3 interest in the project. Toledano and Houri made such
      representations to induce Boaziz to enter into a limited liability
      company operating agreement relating to the Villaggio Project
      reflecting such an ownership interest. Boaziz would not have entered
      into such agreement had he known such representations by Toledano
      and Houri.

This falls far short of alleging with particularity when this representation was made

and under what circumstances it was made—that is, in January of 2005 when this

project was first identified, three months later when operating agreements were

signed, or sometime in between when the parties were putting the project together.

This also fails to state that when the representation was made that Houri either

knew or should have known that he was not going to contribute the same or

substantially the same as Boaziz for a similar interest. In sum, Boaziz failed to

                                          20
state a claim for fraudulent inducement with regard to this project on which he

could recover.

      The final judgment entered below underscores these shortcomings and

confirms that fraud in the inducement was not established. The judgment finds

only that “Houri knew [the representation that he would invest one-third of all

required equity for the Villaggio Project] was false since the greater weight of the

evidence reflects that he invested far less than one-third of all required funds.” The

fact Houri invested fewer funds in this project than did Boaziz establishes neither

that Houri’s representation about his intended contribution was false when it was

made or that he had no intention of making the promised contribution. To the

contrary, this determination confirms only that at some point in time the parties

contemplated making equal or substantially equal capital contributions for receipt

of equal interests in this project and that ultimately Houri did not contribute the

same amount of cash as did Houri. As this confirms, no fraud in the inducement

was proved to exist. Nor was any alleged. Boaziz is, therefore, bound by the

terms of the agreements he entered with regard to this project.

   c. Conclusion

      The judgment entered against Houri on counts X for breach of fiduciary

duty, count XI for fraud, count XI [sic] for civil conspiracy, and count XIII for

violation of Florida’s Uniform Fraudulent Transfer Act, all related to the Villaggio

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project, is, therefore, reversed. Because Boaziz enjoyed no individual right of

action stemming from Houri’s alleged wrongdoing, we reverse the judgment

against Skyrise and Realty Advise on count XIII for violation of Florida’s Uniform

Fraudulent Transfer Act.

      Houri’s Individual Liability as to the Golden Isles project

      A different result obtains with regard to the Golden Isles project. With no

operating agreements in place as to the Golden Isles project, we cannot say the trial

court erred either in finding that a joint venture existed as to that project or as to

the duties associated with that designation. We therefore affirm that portion of the

final judgment holding Houri personally liable for breach of fiduciary duty, fraud,

and civil conspiracy as alleged in counts VI, VII, and VIII of the third amended

complaint relating to the Golden Isles project.

                                        Conclusion

      In light of our other rulings herein reversing the awards entered below with

regard to The Residence Las Vegas and the Villaggio projects, we remand for

recalculation of the amount of damages to be awarded on the Golden Isles project

with the caveat that the amount awarded take into consideration the Toledano

settlement.12

12The total amount awarded on these counts before reduction to account for the
Toledano settlement was $907,888.58 which sum included prejudgment interest.

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      Affirmed in part, reversed in part, and remanded for proceedings consistent

with this opinion.

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