In short: Two branches of a family disputed whether they had an oral partnership to develop franchise restaurants. The trial court entered summary judgment on the partnership claim and later dismissed a fourth amended complaint. The Third DCA affirmed in January 2015 without an opinion, so the trial court’s rulings stand and no written precedent was created.
The Facts
This appeal came out of a Miami-Dade lawsuit between relatives. According to the arguments described in the oral-argument video, one side claimed that in 2005 the two families orally agreed to be partners in developing Fuddruckers franchise restaurants through a corporation, Vita Foods 2, Inc. Nothing about the partnership was signed.
The trial court granted summary judgment on the oral partnership claim, reportedly because the claimants could not show damages, and later dismissed the fourth amended complaint. The appellants argued that the dismissal was wrong and that Florida’s statute of frauds, which bars enforcement of certain oral agreements that cannot be performed within a year, did not defeat their claims.
Because the court affirmed without an opinion, these facts come from the parties’ arguments as summarized in the video, not from findings by the appellate court.
The Decision
The Third District issued a per curiam affirmance with no written opinion on January 7, 2015. A PCA means the panel found no reversible error, but it does not say why. The judgment for the appellees stands, and the decision cannot be cited as precedent for any particular rule on oral partnerships or the statute of frauds.
The Law
Florida law does not require a partnership agreement to be in writing. Under section 620.8202, people who associate to carry on a business for profit as co-owners form a partnership whether or not they intend to. But a party claiming one still has to prove the elements, typically a shared intent to be partners, joint control, a community of interest, and a sharing of profits and losses, and has to prove damages to recover money.
The statute of frauds, section 725.01, separately bars lawsuits on agreements not to be performed within one year unless they are in writing and signed. Courts usually read that provision narrowly, so an open-ended partnership that could in theory be performed within a year often survives it. That is why many oral-partnership cases turn on proof and damages rather than the statute of frauds.
Lessons
- Put business deals with relatives in writing. Family trust is not a substitute for an operating agreement or partnership agreement.
- An oral partnership can exist in Florida, but you must prove both the partnership and the money you lost because of its breach.
- If the business ran through a corporation, courts will look hard at who actually owned the shares, not who felt like an owner.
- Repeated amended complaints signal a theory problem. Fix the theory before the fourth try.
Source: Montalvan v. Montalvan, No. 3D14-471 — Fla. 3d DCA (January 7, 2015).
Watch the Oral Argument
This is the recording of the actual oral argument, posted on the channel. What lawyers and judges say at argument is not the ruling; the decision is summarized above.
Handshake Deal to Build Fuddruckers — Barred by the Statute of Frauds? | Montalvan, 3D14-0471
Go Deeper
- Oral Family Real Estate Deal: Statute of Frauds Doesn't End It (Gomez v. Gomez)
- Constructive Trusts in Family Business Fights: Why the Order Was Reversed (Abdo v. Abdo)
Frequently Asked Questions
Is an oral partnership agreement valid in Florida?
Yes. Under section 620.8202, a partnership forms when people carry on a business together for profit as co-owners, even without a written agreement. The person claiming the partnership must prove it, usually with evidence of shared control, shared profits and losses, and a common intent to be partners.
Does the statute of frauds apply to partnership agreements?
Only in limited situations. Section 725.01 bars suits on oral agreements that cannot be performed within one year. Courts read that narrowly, so an open-ended partnership that could end within a year generally is not barred. A partnership agreement with a fixed term longer than a year can be.
What does PCA mean in a Florida appeal?
PCA stands for per curiam affirmed. The appellate court affirms the lower court’s decision without a written opinion explaining its reasoning. The losing party usually has no further appeal, because the Florida Supreme Court generally cannot review a PCA. It also means the decision sets no precedent for other cases.
Why would an oral partnership claim fail on summary judgment?
Common reasons include no evidence of an agreement to share profits and losses, evidence that the business was owned through a corporation the claimant did not hold shares in, or no proof of damages. Without proof of loss, a court can enter judgment even if a partnership arguably existed.
Talk to a Florida business litigation lawyer
Weidner Law, P.A. handles business, LLC, shareholder and contract disputes from St. Petersburg. If you need a civil litigation lawyer, call (727) 954-8752 or email weidner@mattweidnerlaw.com.
Read the law yourself, free: every Florida statute and court rule is on floridarules.net.
This article is general information about Florida law, not legal advice about your situation. Reading it, watching the videos, or contacting the firm does not create an attorney-client relationship. Every case turns on its own facts, and past results do not guarantee a similar outcome. The hiring of a lawyer is an important decision that should not be based solely upon advertisements.
