Opinion
No. 3D99-382.
Opinion filed February 23, 2000. JANUARY, 2000.
An Appeal from the Circuit Court for Dade County, Jon I. Gordon, Judge, L.T. No. 98-24460.
Gunster, Yoakley, Valdes-Fauli Stewart and Phillip M. Hudson, III and Dana A. Clayton, for appellant.
Abrams Anton and Mitchell D. Adler and William S. Kramer (Hollywood), for appellee.
Before JORGENSON, COPE, and LEVY, JJ.
In 1996, Firestone Publishing, Inc. ("Firestone") entered into an Asset Purchase and Sale Agreement ("Purchase Agreement") with Dugent Publishing Corporation ("Dugent") worth $7 million. Pursuant to the Purchase Agreement, Dugent conveyed substantially all of its assets to Firestone. Firestone paid Dugent $3.5 million in cash, gave Dugent a security interest in the property conveyed, and entered into a five-year employment agreement with Walter Weidenbaum ("Weidenbaum"), an officer and director of Dugent, whereby Weidenbaum became the President of Firestone.
As part of the Purchase Agreement, Firestone and Dugent executed a number of documents, including a Promissory Note and a Security Agreement which, in part, provide: "An Event of Default shall be deemed to have occurred hereunder upon a failure by [Firestone] to cause or make any payment when due which continues unremedied for ten (10) days after written notice from [Dugent] given in the manner specified for notice in an Asset Purchase Agreement between [Dugent] and [Firestone]." Section 5 of the Security Agreement includes a Remedies section which provides that in the event of default as defined in the Note, Dugent may
(a) (i) Personally, or by agents or attorneys, immediately take possession of the Pledged Collateral or any part thereof, from Debtor or any other person who then has possession of any part thereof with or without notice or process of law, and for that purpose may enter upon [Firestone's] premises where any of the Pledged Collateral is located and remove such Pledged Collateral and use in connection with such removal any and all service, supplies, aids and other facilities of [Firestone]; [Firestone] hereby covenants and agrees that it shall allow such actions by [Dugent] without causing a breach of the peace.
Moreover, this section grants Dugent the right to dispose of the Pledged Collateral in any manner with the exception that, if Dugent is required by law to give notice, it must give Firestone 10 days notice of the time and place of any public sale or of the time after which a private sale or other intended disposition is to take place. Additionally, the rights extended in the Agreement include "all the rights and remedies of a secured party under the Uniform Commercial Code."
In mid-1998, Firestone began experiencing financial difficulties and sought extensions for past due payments to Dugent. Extensions were given through October 15, 1998, at which time Dugent mailed a Default Notice to Firestone giving Firestone ten days to cure the default. On Monday, October 26, 1998, Weidenbaum took possession of Firestone's assets claiming a creditor security interest. Simultaneously, Firestone's Board of Directors resolved to assign its assets and executed an Assignment for Benefit of Creditors ("the Assignment") conveying all of its assets to William A. Brandt ("Brandt") as assignee. Brandt immediately filed the Assignment with the court pursuant to Chapter 727, Florida Statutes, and attempted to take possession of Firestone's business premises. Weidenbaum refused to relinquish the property on the grounds that Dugent was a creditor in possession prior to the Assignment taking effect and was not required to turnover assets. Brandt filed an Emergency Motion to Compel Turnover of Assets. After an evidentiary hearing on the motion, the trial court denied the motion. Brandt filed a Motion for Rehearing and on January 15, 1999, the trial court denied the motion. On the same day, after notice and publication of the sale, the property was sold at a public sale of assets. This appeal ensues. We affirm based on the authority ofMarine Midland Bank-Central v. Cote, 351 So.2d 750 (Fla. 1st DCA 1977).
In Marine Midland, the First District held that "absent a contrary agreement, when a security agreement provides the secured party has on default the rights and remedies provided by the UCC, the right of repossession . . . implies, . . . a limited privilege to enter on the debtor's land. The privilege may be exercised only `without breach of the peace.'"Id. at 752. The Court set forth a two-prong test to determine if a breach of the peace occurred which requires that the trial court determine (1) whether the creditor entered debtor's premises; and (2) whether the debtor, or his agent, consented to the entry and repossession. Id.
In the instant case, there is no question that Dugent, through the acts of Weidenbaum, entered upon the premises of Firestone. Therefore, the question we must consider is whether Firestone consented to the entry by Weidenbaum for purposes of repossession. We find that when it executed the Security Agreement, giving Dugent the right to enter the property for purposes of repossession and agreed to "allow such action by Dugent without causing a breach of the peace," Firestone consented to the entry and repossession of the collateral.Cf. Quest v. Barnett Bank of Pensacola, 397 So.2d 1020 (Fla. 1st DCA 1981). For the foregoing reasons, we affirm the trial court's Order denying Brandt's Emergency Motion to Compel Turnover of Assets.
Affirmed.
JORGENSON, J., concurs.
The deadline to cure the default under the note fell on a Sunday. I would hold that the deadline carried over to the next business day, Monday. That being so, Dugent acted one day prematurely in seizing the collateral (the assets and business of Firestone Publishing, Inc.) on Monday morning.
This means that Firestone was still in the lawful possession of its business assets on Monday afternoon, when it executed an assignment for the benefit of creditors under chapter 727, Florida Statutes, and appointed appellant William A. Brandt, Jr. as assignee to marshall the assets for the benefit of the creditors.
Dugent argues that this analysis should be rejected because Firestone did not tender the overdue loan installment on Monday, and therefore it was harmless error for Dugent to seize the Firestone business prematurely. That is not a valid argument. Firestone was the owner of the business, not Dugent. Dugent merely had a security interest. Firestone was entitled to control its own property — the business — until the time for cure expired. The assets still belonged to Firestone on Monday afternoon when it executed the assignment for benefit of creditors, and Dugent was not legally entitled to interfere. We should not allow one creditor to jump the gun at the expense of all of the other creditors.
The tendering of a payment to cure a default is an act which logically would take place on a business day, and on this point Florida Rule of Civil Procedure 1.090(a) provides at least a useful analogy. In accordance with what I believe to be the prevailing view, I would hold that since the deadline fell on Sunday, the time was extended through the next business day, Monday. See 74 Am. Jur. 2d Time § 17 (1974); 55 Fla. Jur. 2d Time § 13 (1984);cf. Thorney v. Clough, 438 So.2d 985, 987 (Fla. 3d DCA 1983) (statute of limitations is extended where the last day of the period falls on a Saturday, Sunday, or legal holiday).