Third District Court of Appeal
State of Florida
Opinion filed December 1, 2021.
Not final until disposition of timely filed motion for rehearing.
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No. 3D20-738
Lower Tribunal No. 19-34890
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William L. Ramos, Jr.,
Appellant,
vs.
Michael Halpern, etc.,
Appellee.
An Appeal from the Circuit Court for Miami-Dade County, Beatrice
Butchko, Judge.
Law Office of Hugh J. Morgan, and Hugh J. Morgan; Steven M.
Goldsmith, P.A., and Steven M. Goldsmith (Boca Raton), for appellant.
Waldman Barnett, P.L., and Glen H. Waldman, Michael A. Azre, and
Julie Levine, for appellee.
Before EMAS, LINDSEY and GORDO, JJ.
EMAS, J.
William Ramos appeals an order dismissing, with prejudice, his four-
count amended complaint for failing to post a bond in accordance with the
terms of a revocable trust agreement which was the subject of the litigation
below. We hold that, while the trial court did not err in dismissing the first
three counts of the amended complaint, it did err in dismissing those counts
with prejudice. We further hold that the trial court erred in dismissing the
fourth count, seeking declaratory relief, because the trust’s bond
requirement did not apply to that cause of action.
The litigation below was initiated by Ramos, a beneficiary of the
Matilde Generosa Ramos Revocable Trust (“the Trust”), following the
purchase of certain trust assets by Michael Halpern, Esq., an attorney who
was also designated as a successor trustee to the Trust. Under the terms
of the Trust, after Matilde Ramos’ (“the Grantor”) death, Halpern was
authorized to purchase, at fair market value, the Grantor’s interest in
specifically identified assets. Article VI, Section L.2. of the Trust provided:
Finally, no beneficiary under Article IV may contest the
purchase price of any interest to be sold to MICHAEL
HALPERN, ESQ., under the terms of this subparagraph unless
such beneficiary can demonstrate by clear and convincing
evidence that (i) the appraiser did not use a justifiable fair market
value for such interest based upon valuation guidance used by
the Internal Revenue Service, tax authorities, the Tax Court and
other courts in valuing such closely-held interests for Federal
estate tax purposes, (ii) that MICHAEL HALPERN, ESQ.,
improperly influenced the appraisers through improper
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communications with them and (iii) the challenging beneficiary
places a bond of Two Hundred Thousand Dollars ($200,000)
with the court to ensure payment of attorneys’ fees under
Fla. Stat. §§ 733.106 and 736.1001 et seq. in the event that the
beneficiary is not the prevailing party for such proceedings; it
being GRANTOR’s intent to minimize any litigation unless it can
be shown that the appraiser was improperly influenced by
MICHAEL HALPERN, ESQ., and did not value such interest
utilizing applicable tax principles then existing; and this
subparagraph shall be construed in accordance with
GRANTOR’s stated intent.
(Emphasis added).
Following the Grantor’s death, and Halpern’s purchase of certain
assets, Ramos filed a complaint (and later, an amended complaint) against
Halpern, alleging claims for: (1) breach of fiduciary duty; (2) constructive
trust; (3) undue influence and lack of mental capacity; and (4) declaratory
judgment. Ramos did not post a bond as required under the terms of the
Trust. Halpern filed a motion to dismiss, citing Ramos’ failure to comply with
the Trust’s provision requiring a challenging beneficiary to post a $200,000
bond. The trial court dismissed the amended complaint without prejudice,
allowing Ramos sixty days to post a bond. When Ramos again failed to post
the bond, the trial court, following a hearing, dismissed the amended
complaint (all four counts) with prejudice.
Counts One, Two and Three were each premised upon allegations that
Halpern purchased certain assets of the Trust for less than fair market value.
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These counts clearly fall within the ambit of the Trust provision that “no
beneficiary. . . may contest the purchase price of any interest to be sold to
Michael Halpern, Esq. unless. . . the challenging beneficiary places a bond
of Two Hundred Thousand Dollars ($200,000) with the court to ensure
payment of attorney’s fees. . ..” However, Count Four did not contest the
purchase price of Trust assets sold to Halpern. Instead, it sought declaratory
relief from the trial court—specifically, a declaration, inter alia, that the
$200,000 bond provision in the Trust was an unenforceable penalty under
Florida law. 1
At the hearing, the trial court indicated that Ramos’ failure to post the
bond during the intervening sixty days required dismissal of the entire
amended complaint with prejudice. Ramos argued, however, that he should
not be required to post a bond until the court first determined the
enforceability of the Trust’s bond requirement, as requested in his
declaratory judgment claim. Ramos requested the trial court bifurcate the
1
See § 736.1108(1), Fla. Stat. (2013) (providing: “A provision in a trust
instrument purporting to penalize any interested person for contesting the
trust instrument or instituting other proceedings relating to a trust estate or
trust assets is unenforceable”); Dinkins v. Dinkins,
120 So. 3d 601 (Fla. 5th
DCA 2013). We note that, while this opinion focuses on the challenge to
the Trust’s $200,000 bond requirement, Count Four of Ramos’ amended
complaint seeks a declaration that other provisions contained in the
previously quoted portion of Article VI, Section L.2. of the Trust are likewise
unenforceable.
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declaratory judgment count from the other three counts of the amended
complaint and expedite the determination of whether the Trust’s bond
requirement was enforceable under Florida law. The trial court denied this
request, determining it did not need to reach the question of the
enforceability of the bond provision, and dismissed the entire amended
complaint with prejudice for Ramos’ failure to post the $200,000 bond.
We hold that the trial court erred in two regards: first, the trial court
erred in dismissing the declaratory judgment count for failure to post the
$200,000 bond, because the declaratory judgment count did not “contest the
purchase price of any interest to be sold” to Halpern, and thus did not trigger
the Trust’s bond requirement. Second, and given that the declaratory
judgment action remained viable, the trial court erred in dismissing the
remaining counts with prejudice for failure to post the $200,000 bond.
Instead, the trial court’s dismissal of those three counts should have
remained without prejudice, and the trial court should have proceeded on the
declaratory judgment count, which sought a determination of whether the
Trust’s bond provision was enforceable under Florida law.2
2
If the trial court adjudicates the declaratory judgment count and determines
the Trust’s bond provision is enforceable under Florida law, Ramos would
presumably have to post to a bond in order to proceed on his remaining
claims, failing which the trial court could dismiss the entire action with
prejudice. If the trial court adjudicates the declaratory judgment count and
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Accordingly, we reverse the order dismissing the amended complaint
with prejudice. Count Four is hereby reinstated, and the dismissal of counts
One, Two and Three shall be without prejudice. We remand this cause to
the trial court for further proceedings consistent with this opinion.
determines the Trust’s bond provision is unenforceable, Ramos would
presumably be permitted to proceed on his remaining claims without having
to comply with that condition. We express no opinion on the merits of this
issue.
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