F.S. 1987 PUBLIC FAIRS AND EXPOSITIONS Ch.616

vals. The minimum exhibits required of such shows or festivals shall be as follows:

(a) Each specialized livestock show shall consist of at least 50 head of animals or 300 head of poultry.

(b) Each specialized fruit, vegetable, or crop festival or exposition shall consist of at least 50 entries in the specialty, which shall occupy at least 1,000 square feet of display area.

History.-s. 8, ch. 59-166; ss. 14, 35, ch. 69-106; s. 3, ch. 81-297; s. 2, ch. 81-318; ss. 15, 25, 26, ch. 83-239; s. 7, ch. 85-62.

1Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and is scheduled for review pursuant to s. 11 .61 in advance of that date.

1616.19 Designation of fairs.-Any agricultural and livestock fair heretofore or hereafter created pursuant to this chapter shall be designated by the name stated in the permit required or stated by such fair association and shall be recognized by the state as equal in dignity to the Florida State Fair and shall be as fully recognized as the Florida State Fair.

History.-ss. 1, 2, ch. 61-513; s. 2, ch. 81-318; ss. 16, 25, 26, ch . 83-239. 1Note.-Expires October 1, 1993, pursuant to s. 26, ch . 83-239, and is scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.21 Agricultural and livestock exhibit buildings; conditions for expenditures; Agricultural and Live­stock Fair Council.-

(1) No part of appropriated funds may be expended except upon approval and with the recommendation of the department. Further, no part of such an appropria­tion may be expended for the construction of a building unless and until a good fee simple title to the land on which such building is to be constructed is vested in the county, city, or fair association for which such building is to be constructed.

2(2)(a) There is created in the department the Agri­cultural and Livestock Fair Council, which shall be com­posed of five members, one of whom shall be appointed chairman annually by the commissioner, as follows: the administrator of the Agriculture Section in the Division of Vocational, Adult , and Community Education of the Department of Education; a representative of the De­partment of Agriculture and Consumer Services desig­nated by the Commissioner of Agriculture; the Dean for Extension , Institute of Food and Agricultural Sciences of the University of Florida; the president of the Florida Federation of Fairs and Livestock Shows; and the presi­dent of the Florida Farm Bureau Federation or his repre­sentative. The chief of the Bureau of Public Fairs and Ex­positions, Division of Administration of the Department of Agriculture and Consumer Services, shall serve as secretary to the council and shall keep a complete rec­ord of all its proceedings, which record shall show the names of the members present at each meeting and any action taken by the council.

(b) The council shall meet at the call of its chairman, at the request of a majority of its membership, at the re­quest of the department, or at such times as may be pre­scribed by its rules. No official action may be taken by the council unless three of its members are in agree­ment on the particular proposal, recommendation, or motion.

(c) The members of the council shall receive no com­pensation for their services but shall be entitled to be re-

351

imbursed for per diem and travel expenses as provided in s. 112.061.

(3) It is the duty and responsibility of the Agricultural and Livestock Fair Council:

(a) To advise, counsel , and consult with the commis­sioner and the chief of the Bureau of Public Fairs and Ex­positions of the Division of Administration of the Depart­ment of Agriculture and Consumer Services, upon re­quest in connection with:

1. The adoption, administration, and enforcement of all laws and rules relating to fairs and expositions.

2. Expenditures of moneys appropriated for the construction or repair of agricultural and livestock exhib­it buildings in the state.

3. Issuance of permits to conduct fairs or exposi-tions for the benefit and development of the educational, agricultural , horticultural, livestock, and other resources of the state as provided in s. 616.15.

(b) On its own initiative, to offer suggestions and recommendations to the commissioner and the depart­ment in regard to changes in the laws and rules relating to public fairs and expositions as may be deemed advis­able to secure the effective administration and enforce­ment of the laws and rules.

(c) Upon the request of the commissioner, to investi­gate violations of the provisions of this chapter and rules adopted under this chapter and to report its findings or recommendations in connection therewith to the com­missioner and the department.

(4) The council may adopt rules, not inconsistent with law, to govern its own proceedings.

Hlstory.-s. 2, ch. 29832, 1955; s. 1, ch . 59-367; s. 2, ch. 61-119; s. 2, ch. 83-393; ss. 3, 14, 35, ch. 69-106; s. 1, ch. 71-2; s. 260, ch. 71-377; s. 207, ch. 77-104; s. 17, ch. 77-108; s. 4, ch. 78-323; ss. 4, 5, 6, ch. 81-297; s. 2, ch. 81-318; s. 1, ch. 82-46; ss. 17, 24, 25, 26, ch. 83-239; s. 7, ch. 85-75.

•Note.-Expires October 1, 1993, pursuant to s. 26, ch . 83-239, and is scheduled for review pursuant to s. 11 .61 in advance of that date , except that subsection (2) is scheduled for review pursuant to s. 11.611 . •Note.-Expires October 1, 1993, pursuant to s. 26, ch . 83-239, and is scheduled

for review pursuant to s. 11 .611 in advance of that date. Note.-Former s. 603.21.

1616.22 Exhibit buildings; matching funds for con­struction or repair.-ln the construction or repair of buildings as authorized by any annual appropriation, the money to be expended therefor from such appropriation shall be matched in an equal amount by the county, city, or fair association for which such buildings are to be con­structed or repaired. The amount to be paid by the coun­ty, city, or fair association for such construction or repair shall be made available before such construction or re­pair is begun. In no event may an amount greater than $25,000 be expended from such appropriation for the construction or repair of exhibit buildings for any one county, city, or fair association, from funds appropriated for such purpose; however, any amount not greater than $25,000 may be expended from the appropriation for the construction or repair of exhibit buildings for any one county, city, or fair association from the unexpended balance of any appropriation regardless of the amount previously expended under any other legislative appro­priation for that one county, city, or fair association.

History.-s. 3, ch. 29832, 1955; s. 2, ch. 59-367; s. 3, ch. 83-393; s. 207, ch. 77-104; s. 2, ch. 81-318; ss . 18, 25, 26, ch. 83-239.

1Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and is scheduled for review pursuant to s. 11 .61 in advance of that date.

Note.-Former s. 603.22.

Ch.616 PUBLIC FAIRS AND EXPOSITIONS F.S. 1987

1616.23 Use of buildings.-The buildings authorized by ss. 616.21-616.23 may be used by the county, city , or fair association for which the buildings are built as ag­ricultural or livestock exhibition buildings for fair pur­poses in the promotion of the agricultural and livestock industries and for the benefit and development of the cultural , educational , agricultural , horticultural , live­stock, and other resources of the state or counties or ci t­ies of the state. These buildings may be used as office space for agricultural agents; however, no more than 20 percent of such buildings may be used for such office space.

History_-s. 4, ch. 29832, 1955; s. 3, ch. 59-367; s. 4, ch. 83-393; s. 2, ch. 81-318; ss. 19, 25, 26, ch. 83- 239.

1Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and is scheduled for review pursuant to s. 11 .61 in advance of that date.

Note.-Former s. 603.23.

1616.251 Florida State Fair Authority; creation; re­sponsibility for staging annual state fair.-

(1) There is created and constituted the "Florida State Fair Authority," a public body corporate and politic, for the purposes and with the powers herein set forth. Such instrumentality, hereinafter referred to as "the au­thority," shall have perpetual succession . For the pur­poses of implementing the intent of this act , the authori­ty shall be considered an instrumentality of the state.

(2) The authority shall operate under the supervision of the Commissioner of Agriculture. Such supervision may include, but will not be limited to, assisting , advis­ing , and making recommendations regarding the financ­ing and operation of the authority.

(3) The authority is charged with the responsibility of staging an annual fair. The fair shall serve the entire state, and no less than 20 percent of the counties are to be represented in agricultural and industrial exhibits, and 50 percent of the counties are to have individual ex­hibitors, youth or adult. Cash premiums or awards total­ing no less than $50,000 shall be given to exhibitors. Ag­ricultural and industrial products shall be typical of those produced in the area the exhibit represents .

(4) The principal offices of the authority shall be in such place or places in or near the City of Tampa as the authority may from time to time designate.

History.-ss. 1, 5, ch. 74-322; s. 4, ch. 78-323; ss. 1, 5, 6, ch. 81 -81; s. 2, ch. 81-318; s. 1, ch. 82-46; ss. 20, 24, 25, 26, ch. 83-239; s. 8, ch. 85-62.

1Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and is scheduled for review pursuant to s. 11.611 in advance of that date.

1616.252 Florida State Fair Authority; membership; number, terms, compensation.-

(1 )(a) The authority shall be composed of 29 mem­bers. The Governor, the Commissioner of Agriculture, the Dean for Extension at the Institute of Food and Agri­cultural Sciences of the University of Florida, and the Program Director for Agriculture and Natural Resources in the Department of Education shall serve ex officio. The Commissioner of Agriculture shall nominate three persons for each other membership, from which persons the Governor shall appoint a member of the authority. Such appointment shall be subject to Senate confirma­tion. At least one member shall be selected from each congressional district. The term of each member shall be 4 years, except the Governor shall appoint any mem­ber for a shorter term to assure that no more than seven appointed members have terms that expire in any calen-

dar year. Any vacancy shall be filled for the remainder of the unexpired term pursuant to the method herein provided for appointment. Six of the members may be from Hillsborough County.

(b) At least 60 percent of the members of the author­ity shall be persons who are or have been directors or officers of a fai r association or who have otherwise ac­tively participated in conducting a public fair, festival, show, exposition, or similar activity. Holding a commis­sion as a member of another board or authority does not render a person ineligible to serve as a member of the fair authority so long as the common-law rule of incom­patibility does not prohibit holding both commissions.

(2) The authority shall meet at the call of its chair­man, at the request of a majority of its membership, at the request of the department, or at such times as may be prescribed by its rules.

(3) Members of the authority shall not be entitled to compensation for their services as members, but shall be reimbursed for traveling expenses as provided in s. 112.061 and may be compensated for any special or full-time service performed in its behalf as officers or agents of the authority.

History.- s. 2, ch. 74-322; s. 1, ch. 78-409; s. 2, ch. 81-81 ; s. 2, ch. 81-318; ss. 21, 25, 26, ch. 83- 239.

' Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83- 239, and is scheduled for review pursuant to s. 11 .61 in advance of that date.

1616.253 Florida State Fair Authority; officers; quo­rum.-The authority shall elect from among its members an executive committee to consist of a chairman who shall preside, a vice chairman, a secretary, a treasurer, and such other officers as the authority may deem nec­essary or expedient in the performance of its functions. The same person may serve both as secretary and treasurer, if thus designated. No more than three direc­tors from any congressional district or county may serve on the executive committee. The authority may delegate to any of its members, officers, agents, or employees any of its powers or duties, which delegation it deems necessary to fulfill its responsibilities , and shall establish bylaws and such rules of conduct and procedure as it may deem necessary to govern its own functioning. A majority of the appointed members of the authority shall constitute a quorum. No vacancy in the membership shall impair the right of a quorum to exercise all of the powers, functions, and duties of the authority.

Hlstory.-s. 3, ch. 74-322; s. 2, ch. 78-409; s. 3, ch. 81-81 ; s. 2, ch. 81-318; ss. 25, 26. ch. 83-239.

1Note.- Repealed effective October 1, 1993, by s. 26, ch. 83-239, and scheduled for review pursuant to s. 11 .61 in advance of that date.

1616.254 Authority of Florida State Fair Authority to sue and be a party to suits.-The authority may sue and be sued, plead and be impleaded, and complain and de­fend in all courts of law and equity with respect to its contractual rights and obligations and to carry out its proper purposes and functions .

History.-s. 4, ch. 74-322; s. 2, ch. 81 - 318; ss. 25, 26, ch. 83-239. 'Note.- Repealed effective October 1. 1993, by s. 26, ch. 83- 239, and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.255 Duties of authority; Florida State Fair­grounds.-The authority shall:

(1) Designate a suitable location in Hillsborough County as the Florida State Fairgrounds.

352

F.S. 1987 PUBLIC FAIRS AND EXPOSITIONS Ch.616

(2) Throughout each year, promote the progress of the state and stimulate public interest in the advantages and development of the state by providing facilities for agricultural and industrial exhibitions, public gatherings, cultural activities, and other functions calculated to ad­vance the educational, physical, economic, and cultural interests of the public.

(3) Hold an annual fair on the Florida State Fair­grounds for the exhibition of agricultural, industrial, me­chanical, horticultural, dairy, forestry, poultry, livestock, mineral, cultural, and all other interests of the state, and establish rules of exhibition and operation for the fair. Such fair shall be subject to the requirements of ss. 616.15 and 616.17.

(4) Erect and repair buildings on the Florida State Fairgrounds, make any and all necessary or proper im­provements, and generally carry on a program of devel­opment and extension of facilities designed to accom­plish the objectives defined in this section.

History.-s. 6, ch. 74-322; s. 2, ch. 81-318; ss. 22, 25, 26, ch. 83-239. 1Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and is scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.256 Powers of authority.-The authority shall have power to :

(1) Have a seal and to alter the same at pleasure. (2) Acquire, hold, lease, and dispose of real and per­

sonal property for its authorized purposes. (3) Own, operate, maintain, repair, and improve its

facilities. (4) Acquire in its own name by purchase, grant, gift,

or lease, on such terms and conditions and in such man­ner as it may deem proper, real and personal property, and acquire, construct, reconstruct, improve, alter, re­pair, maintain, operate, sell, convey, lease, and dispose of any building, structure, or facility.

(5) Employ consulting engineers, architects, super­intendents or managers, accountants, inspectors, attor­neys, and such other employees as may be deemed necessary and prescribe their powers and duties and fix their compensation.

(6) Accept loans or grants of money, property, or personal services from any agency, corporation, or per­son.

(7) Make and enter into all contracts or agreements, as the authority may determine, which are necessary or incidental to the performance of its duties or the execu­tion of its powers under this act.

(8) Borrow money for any of its authorized purposes and for expenses incidental thereto, including expenses incurred during the period of organization and construc­tion prior to the operation of the Florida State Fair, and incur obligations with respect to such borrowings, in­cluding notes, secured or unsecured, and negotiable revenue bonds, as hereinafter provided , payable solely from revenues accruing from the operation of the Florida State Fair or any part or parts thereof and from author­ized activities incidental thereto; to pay interest with re­spect to such borrowings not exceeding the maximum allowable by law; to provide for the payment of such bor­rowings and interest as hereinafter provided; to fix rates and make collections for the use of the facilities and ser­vices of the authority; and to execute mortgages, trust

indentures or other instruments, as may be required for the financing of the authorized activities of the authority.

(9) Engage in any lawful business or activity deemed by it to be necessary, convenient, appropriate, or useful in the full exercise of its powers to establish, finance, and operate the Florida State Fair under the provisions of this act, including the leasing for revenue of any land, improved real estate, or personal property directly related to, or appropriate in connection with, the financing or conduct of the Florida State Fair or reserved for its future use or expansion . Within the meaning of this act, any use of the property of the authority, real or personal, shall be deemed necessary, convenient, ap­propriate, or useful which stimulates, assists, fosters, and promotes all phases of the economy of the state, in­cluding agricultural, industrial, commercial, cultural, and recreational pursuits, or which provides revenue to the authority from said property, pending its future use for any of the purposes of the state fair .

(1 0) Adopt, pursuant to chapter 120, rules necessary to carry out its duties and responsibilities.

History.-s. 7, ch. 74-322; s. 4, ch . 81-81 ; s. 2, ch . 81-318; ss. 25, 26, ch. 83-239. 1Note.-Repealed effective October 1, 1993, by s. 26, ch. 83-239. and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.257 Issuance of revenue bonds by authority.-(1) Revenue bonds may be issued on behalf of and

at the request of the authority, as provided in the State Bond Act. The proceeds of each issue of bonds shall be used solely for the payment of the cost of the state fair project or projects for which such bonds were issued, as provided in the proceedings authorizing the issuance of such bonds.

(2) No revenue bonds shall be issued under the pro­visions of this act unless the authority shall have thereto­fore found and determined:

(a) The estimated cost of the project for which such bonds are proposed to be issued.

(b) The estimated annual revenues of the project, and of any other special funds provided for in this act, which may be pledged as security for the bonds.

(c) The estimated annual cost of maintaining, repair­ing, and operating the project.

(3) Revenue bonds issued under the provisions of this act shall not be deemed to be a debt of the state or to pledge the faith and credit or taxing power of the state, but such bonds shall be payable exclusively from the funds pledged for their payment as authorized here­in . State funds, other than any initial appropriation, shall not be used, appropriated, or expended to construct, re­construct, maintain, service, repair, purchase, or lease any property or project or projects authorized hereun­der.

(4) All projects of the authority shall be deemed to be state capital projects within the meaning of s. 11, Art. VII of the State Constitution.

History.-ss. 8, 9, ch. 74-322; s. 2, ch. 81-318; ss. 25, 26, ch. 83-239. 1Note.-Repealed effective October 1, 1993, by s. 26, ch. 83-239, and scheduled

for review pursuant to s. 11 .61 in advance of that date. cf.-ss. 215.57-215.83 State Bond Act .

1616.258 Revenues from projects of authority.­(1) The authority shall fix and revise from time to

time rates, fees, rentals, tolls , or other charges for the use of each project or for the services and facilities fur-

353

Ch.616 PUBLIC FAIRS AND EXPOSITIONS F.S. 1987

nished thereby and charge and collect the same. Such rates , fees , rentals , tolls, or other charges shall be so fixed and adjusted, in respect of the aggregate of rates , fees , rentals, tolls , or other charges from the project or projects for which bonds are issued, as to provide a fund sufficient, together with any other special funds pledged therefor as provided in this act, to pay the cost of main­taining, repairing , and operating such project or projects and the principal of, and interest on, the revenue bonds as the same shall become due and to provide reserves for such purposes, and to make all such other payments required by the proceedings authorizing the issuance of such revenue bonds. The rates , fees , rentals, tolls, and other charges shall not be subject to supervision or reg­ulations by any state commission , board, bureau, or agency other than the authority.

(2) All , or a sufficient amount of, the revenues de­rived from a project or projects for which revenue bonds have been issued shall be set aside, at such regular in­tervals as may be provided in the resolution authorizing the issuance of the bonds, or in the trust agreement se­curing the same, in a sinking fund for the payment of the principal and interest on such bonds as the same shall become due and any premium upon bonds retired by call or purchase as therein provided , and for reserves therefor, and to pay the cost of maintaining , repairing, and operating the project or projects and of providing reserves therefor, all in the order of priority and manner as shall be provided in such resolution or trust agree­ment. The use and disposition of the sinking fund shall be subject to such regulations as may be provided in the resolution authorizing the issuance of the bonds or in the trust agreement.

History.- s. 10, ch. 74-322; s. 1, ch. 77-174; s. 2, ch. 81-318; ss. 25, 26, ch. 83- 239.

1Note.- Repealed effective October 1, 1993, by s. 26, ch. 83- 239, and scheduled for review pursuant to s. 11 .61 in advance of that date.

1616.259 Revenues of authority; trust funds.-AII moneys received pursuant to the authority of this act, whether as proceeds from the sale of revenue bonds or as revenues, shall be deemed to be trust funds . Pro­ceeds from the sale of revenue bonds shall be held and applied as provided by law. Revenues of the authority shall be held and applied, consistent with law, as provid­ed by resolutions of the authority.

Hlstory.-s. 11 , ch. 74-322; s. 2, ch. 81-318; ss. 25, 26, ch. 83-239. 'Note.-Repealed effective October 1, 1993, by s. 26, ch. 83- 239, and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.260 Tax exemption of authority.-lt is hereby found and determined that all of the projects authorized by this act constitute essential governmental purposes, and all of the properties, revenues, moneys, and other assets owned and used in the operation of such projects shall be exempt from all taxation by the state or by any county, municipality, political subdivision , agency, or in­strumentality thereof . However, nothing contained here­in shall grant any person other than the authority an ex­emption from the tax imposed in chapter 220, and if property of the authority is leased, the property shall be exempt from ad valorem taxation only if the use by the lessee qualifies the property for exemption under s. 196.199. The exemption granted by this section shall not be applicable to any tax imposed by chapter 220 on in-

terest , income, or profits on debt obligations owned by corporations. The property of the authority shall be sub­ject to the provisions of s. 196.199.

History.- s. 12, ch. 74- 322; s. 2, ch. 81- 318; ss. 25, 26, ch. 83-239. 1Note.-Repealed effective October 1, 1993, by s. 26, ch. 83-239, and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.261 Finances of state fair.-Operation of the state fair , and custody and maintenance of the buildings and grounds, shall be financed from the revenues de­rived from the state fair and other exhibits or events, rev­enue bonds, and lease, rental , or other charges for the use of the buildings or grounds.

Hlstory.-s. 13, ch. 74-322; s. 2, ch. 81- 318; ss. 25, 26, ch. 83-239. 1Note.-Repealed effective October 1, 1993, by s. 26, ch. 83-239, and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.262 Conveyance by the authority; option to ac­quire by Board of Trustees of Internal Improvement Trust Fund.-Any provision of this act to the contrary notwithstanding , no transfer, lease, conveyance, or en­cumbrance of any land or interest therein inconsistent with the development of a state fair as provided in this act shall be made without prior approval from the Board of Trustees of the Internal Improvement Trust Fund or its successors. Prior to any lawful transfer of title to all or any part of the property owned by the authority by any public entity to any private person, individual, group, partnership, association , corporation, organization, or other private entity or entities, the board of trustees or its successors shall have an option to acquire the sub­ject property without payment of consideration.

History.- s. 14. ch. 74- 322; s. 2, ch. 81-318; ss. 25, 26, ch. 83-239. 1Note.- Repealed effective October 1, 1993, by s. 26, ch. 83- 239, and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.263 Annual reports and audit of authority.-(1) The authority shall submit each year, at least 60

days prior to the convening of the Legislature, a compre­hensive report to the Governor and the Commissioner of Agriculture outlining the progress and the activities of the authority. The Commissioner of Agriculture shall transmit the authority 's report to the Legislature, togeth­er with any comments and recommendations for legisla­tion .

(2) The authority shall at all times maintain proper accounting systems and procedures and shall be sub­ject to annual auditing by the Auditor General as provid­ed in s. 11.45.

History.-ss. 15, 16, ch. 74-322; s. 2, ch. 81 -318; ss. 25, 26, ch. 83-239. 'Note.-Repealed effective October 1, 1993, by s. 26, ch. 83- 239, and scheduled

for review pursuant to s. 11.61 in advance of that date.

1616.265 Issuance of beverage license to the au­thority.-

(1) The Division of Alcoholic Beverages and Tobac­co of the Department of Business Regulation is author­ized , upon application , to issue a beverage license as contemplated in ss. 561.17 and 565.02 to the Florida State Fair Authority for use within any of those certain buildings known as the "Exposition Building ," the "Exhibi­tion Building ," and "Old MacDonald's Farm" or any other specific location designated by the Florida State Fair Au­thority, located within the Florida State Fairgrounds complex in Hillsborough County; however, the license is­sued pursuant to this section shall not permit the licens­ee or its assigns to:

354

F.S. 1987 PUBLIC FAIRS AND EXPOSITIONS Ch.616

(a) Use such license in more than one location at a time.

(b) Use such license during the time the authority is staging the annual Florida State Fair.

(c) Sell alcoholic beverages in sealed containers for consumption off the premises where sold.

(2) The application for the license authorized in sub­section (1) shall be made in the name of the Florida State Fair Authority, and the applicant shall comply with the provisions of chapter 561 prior to the issuance of the li­cense in the name of the Florida State Fair Authority.

(3) It is the intent and purpose of this section that any business operated under the beverage license authorized in subsection (1) be operated only by a con­cessionaire under contract, entered into under competi­tive bid, with the Florida State Fair Authority to furnish alcoholic beverages within those certain buildings known as the "Exposition Building," the "Exhibition Build­ing," or "Old MacDonald's Farm" or any other specific lo­cation designated by the Florida State Fair Authority. No contract may be entered into by the authority with any concessionaire which discriminates on the basis of race, sex, age, or religion . The Florida State Fair Authority shall make application for the transfer of the license to the concessionaire, and the application shall be ap­proved by the Director of the Division of Alcoholic Bever­ages and Tobacco in compliance with the applicable provisions of chapter 561. However, any transfer of the beverage license authorized in subsection (1) to a con­cessionaire operating under contract with the Florida State Fair Authority shall be on the condition that, if the concession contract is terminated at any time and for any cause, the concessionaire shall immediately retrans­fer the beverage license to the Florida State Fair Authori­ty. In the event of the failure or refusal of the concession­aire so to retransfer the beverage license, it shall be retransferred to the Florida State Fair Authority upon proper request made in writing to the Division of Alcohol­ic Beverages and Tobacco of the Department of Busi­ness Regulation. Thereafter, the beverage license may again be transferred upon the same terms and condi­tions to any new concessionaire under contract with the Florida State Fair Authority. It is the intent and purpose of this section that the beverage license be at all times the property of the Florida State Fair Authority, subject to its transfer, from time to time, to enable the conces­sionaire under contract with the Florida State Fair Au­thority to furnish alcoholic beverages within the Exposi­tion Building, the Exhibition Building, or Old MacDon­ald's Farm, or any other specific location designated by the Florida State Fair Authority, in operating under the beverage license authorized by this section.

History--ss. 1, 2, 3, ch. 77-252; s. 33, ch. 79-11; s. 2, ch. 81-318; ss. 23, 25, 26, ch. 83-239.

'Note.-Expires October 1, 1fj93, pursuant to s. 26, ch. 83-239, and is scheduled for review pursuant to s. 11 .61 in advance of that date.

1616.266 Trespass upon grounds or facilities of fair or exposition; penalty; arrests.-

(1) For the purposes of this chapter, "trespass" upon the grounds of the Florida State Fair Authority or any oth­er fair or exposition permitted under s. 616.15 means:

(a) Entering and remaining upon any grounds or fa­cilities owned, operated, or controlled by the Florida

State Fair Authority or any other fair or exposition permit­ted under s. 616.15 and committing any act which dis­rupts the orderly conduct of any authorized activity of any such organization or its lessees on the said grounds or facilities; or

(b) Entering and remaining on the said grounds or facilities after being directed not to enter, or to leave, the same by the executive director of the authority, chief ad­ministrative officer of such fair or exposition, or any em­ployee or agent thereof designated by him to maintain order on the said grounds and facilities, after a determi­nation by said executive director, administrator, employ­ee, or agent that the entering or remaining on the said grounds or facilities is in violation of the rules and regula­tions of the Florida State Fair Authority or permitted fair or exposition or is disrupting the orderly conduct of any authorized activity of any such organization or its les­sees on the said grounds or facilities .

(2) Any person found guilty of committing the of­fense of trespass upon the grounds of the Florida State Fair Authority or any other fair or exposition permitted under s. 616.15 is guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

(3) A peace officer may arrest any person on or off the premises, without a warrant, if the officer has proba­ble cause for believing such person has committed the offense of trespass upon the grounds of the Florida State Fair Authority or any such permitted organization. Such arrest shall not render the peace officer criminally or civilly liable for false arrest , false imprisonment, or un­lawful detention.

History.-s. 1, ch. 78-427; s. 2, ch . 81-318; ss. 25, 26, ch . 83-239. 'Note.-Repealed effective October 1, 1993, by s. 26, ch. 83-239, and scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.27 Rules.-The department shall adopt rules necessary to carry out the provisions of this chapter.

History.-ss. 3, 26, ch . 83-239. . 'Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and 1s scheduled

for review pursuant to s. 11 .61 in advance of that date.

1616.28 Enforcement.-(1) The bureau shall administer and enforce the pro­

visions of this chapter, as provided in s. 570.30(6). (2) It is the duty of every state attorney, sheriff, law

enforcement officer, and other appropriate county or municipal officer to enforce this chapter and the rules adopted pursuant to this chapter and to assist the bu­reau and its inspectors and agents in the enforcement of this chapter and the rules adopted pursuant to this chapter.

(3) The department, through the bureau, may com­mence and maintain any necessary and proper action for the following purposes:

(a) To enforce this chapter and the rules adopted pursuant to this chapter.

(b) To seek to enjoin violations of this chapter. The circuit court may, after a hearing and for good cause shown, temporarily or permanently enjoin any person from violating this chapter or failing to comply with the requirements of this chapter.

History.-ss. 2, 26, ch. 83-239. . 'Note.-Expires October 1, 1993, pursuant to s. 26, ch. 83-239, and IS scheduled

for review pursuant to s. 11 .61 in advance of that date.

355

Ch. 617

617 .001 617.002 617.003 617 .01

617.0101

617.0105 617.011 617.Q12 61 7.013

617.014 617.015 617.016 617.017

617.018

617.019 617.0201 61 7.021 617.022 617.023 617.026 617.028

617.0285

617.03 617.041 617.05 617.051 617.052 617.0525

617 .053 617.054 617.055 617.056 617.09

617 .10 617 .1 1

617 .12

617 .13

617.14 617.15

617 .16

CORPORATIONS NOT FOR PROFIT F.S. 1987

CHAPTER 617

CORPORA liONS NOT FOR PROFIT

Short title. Applicability of General Corporation Act. Corporate name. Corporations which may be incorporated

hereunder; incorporation of certain medi­cal services corporations.

Corporation not for profit organized pursuant to s. 2, ch . 87-296, Laws of Florida; re­quirements.

Prohibited activities by private foundations . Nonstock and stock share corporations. Reincorporation. Incorporators; articles of incorporation ; exe-

cution ; content ; delivery and filing. Commencement of corporate existence. Filing fees . Right to amend the articles of incorporation . Procedure to amend articles of incorpora-

tion . Articles of amendment; execution; content ;

delivery and filing . Effect of amendment. Restated articles of incorporation . Corporate powers. Estoppel ; ultra vires . Registered office and registered agent. Board of directors, managers, or trustees. Indemnification and liability of officers, direc-

tors , managers, trustees, employees, and agents .

Officers and directors of certain corporations and associations not for profit; immunity from civil liability.

Effect of certificate of incorporation . Members. Dissolution . Merger. Consolidation . Consolidation or merger of domestic and for-

eign corporations. Approval of merger or consolidation. Articles of merger or consolidation. Effective date of merger or consolidation . Effect of merger or consolidation. Proceedings to revoke articles of incorpora-

tion or charter or prevent its use. Bylaws. Foreign nonprofit corporations ; qualifica­

tions. Extinct churches and religious societies;

property. Extinct churches and religious societies; dis­

solution. Incorporation of labor unions or bodies. Sponge packing and marketing corpora­

tions. Corporations for profit ; when may become

corporations not for profit.

617.17

617.18

617.19

617.21

Conversion to corporation not for profit ; peti­tion and contents.

Conversion to corporation not for profit; au­thority of circuit judge.

Application of chapter to corporation con­verted to corporation not for profit.

Corporations not for profit; when authorized to act as trustee.

617.001 Short title.-This chapter may be cited as the "Florida Not For Profit Corporation Act."

Hiatory.- s. 6, ch. 82-177.

617.002 Applicability of General Corporation Act. -The provisions of chapter 607, the Florida General Corporation Act , apply to all corporations not for profit , except to the extent that any provision of chapter 607 conflicts with any provision of this chapter.

Hiatory.- s. 7, ch . 82-177.

617.003 Corporate name.- The corporate name shall comply with the provisions of s. 607.024, except that:

(1) The corporate name: (a) May not contain the word "company." (b) May contain the word "cooperative" or "co-op"

only if the resulting name is not deceptively similar to the name of any corporation, agricultural cooperative mar­keting association , or nonprofit cooperative association existing or doing business in this state under the provi­sions of chapter 607, chapter 618, or chapter 619.

(2) Any corporation eligible to reincorporate under the provisions of s. 617.D12 may do so and retain its cor­porate name.

History.-s. 8. ch. 82-1 77.

1617.01 Corporations which may be incorporated hereunder; incorporation of certain medical services corporations.-

(1) Corporations may be organized and incorporat­ed under this chapter for any one or more lawful pur­poses not for pecuniary profit; provided, however, that corporations not for profit which may be incorporated under any other law of this state governing particular types of corporations may not be incorporated hereun­der.

2{2) As used in this chapter , "corporation not for pro­fit" means a corporation no part of the income of which is distributable to its members, directors, or officers, ex­cept as provided ins. 617.011(1).

(3) A corporation not for profit organized prior to De­cember 1, 1987, pursuant to the provisions of chapter 85-56, Laws of Florida, or to the provisions of s. 2, ch. 87-296, Laws of Florida, may conduct the practice of medicine, conduct programs of medical education, and carry on major medical research efforts.

History.- RS 2259; s. 1, ch. 4231 , 1893; GS 2830; RGS 4499; s. 1, ch. 10095. 1925; CGL 6495; ch. 19108, 1939; s. 1, ch. 59- 427; s. 2, ch. 85- 56; ss. 2, 5, ch. 87-296; s . 1, ch. 87-542.

'Note.-As amended by ss. 2, 5, ch. 87-296, effective December 1, 1987. •Note.-As amended by s. 1, ch. 87-542, effective October 31 , 1987 .

356

F.S. 1987 CORPORATIONS NOT FOR PROFIT Ch.617

617.0101 Corporation not for profit organized pur­suant to s. 2, ch. 87-296, Laws of Florida; require­ments.-A corporation not for profit organized pursuant to the provisions of s. 2, ch. 87-296, Laws of Florida, shall meet the following requirements:

(1) By January 1, 1990, at least 25 percent of its phy­sicians shall have a full-time contract for the provision of medical services with the corporation, be currently certified as specialists by the appropriate American spe­cialty boards accredited by the Council on Medical Edu­cation of the American Medical Association, and have clinical privileges at one or more hospitals in this state.

(2) It is the intent of the Legislature that a hospital owned by a corporation organized pursuant to s. 2, ch. 87-296, Laws of Florida, shall provide Medicaid and charity care that meets the requirements of ss. 196.197(3) and 212.084(7), or equivalent requirements created by the 1987 Legislature.

Hlatory.-s. 3, ch. 87-296.

617.0105 Prohibited activities by private founda­tions.-

(1) As used in this section, section references, un­less otherwise indicated, shall refer to the Internal Reve­nue Code of 1954, Title 26 of the United States Code, as in effect on December 16, 1971, including corre­sponding provisions of any subsequent federal tax laws.

(2) No corporation, during the period it is a "private foundation" as defined in s. 509(a), shall:

(a) Engage in any act of "self-dealing," as defined in s. 4941(d), which would give rise to any liability for the tax imposed by s. 4941(a);

(b) Retain any "excess business holdings," as de­fined ins. 4943(c), which would give rise to any liability for the tax imposed by s. 4943(a);

(c) Make any investment which would jeopardize the carrying out of any of its exempt purposes, within the meaning of s. 4944, so as to give rise to any liability for the tax imposed by s. 4944(a); and

(d) Make any "taxable expenditures ," as defined ins. 4945(d), which would give rise to any liability for the tax imposed by s. 4945(a).

(3) Each corporation, during the period it is a "private foundation" as defined in s. 509, shall distribute, for the purposes specified in its articles of organization, for each taxable year, amounts at least sufficient to avoid liability for the tax imposed by s. 4942(a).

(4) The provisions of subsections (2) and (3) shall not apply to any corporation to the extent that a court of competent jurisdiction shall determine that such ap­plication would be contrary to the terms of the articles of organization or other instrument governing such cor­poration or governing the administration of charitable funds held by it and that the same may not properly be changed to conform to such subsections.

(5) Nothing in this section shall impair the rights and powers of the courts or of the Department of Legal Af­fairs with respect to any corporation.

History.-ss. 1, 2. 3, 4, 5, ch. 71-976.

617.011 Non stock and stock share corporations.­A corporation incorporated hereunder may be organized as provided in its articles of incorporation upon either a nonstock basis or upon a stock share basis.

1 ( 1) A corporation organized upon a nonstock basis shall not issue shares of stock; but membership of such corporation may be evidenced by a certificate of mem­bership which shall contain the statement, printed prom­inently upon the face of the certificate, that the corpora­tion is a nonprofit corporation. No dividend shall be paid, and no part of the income of the corporation shall be dis­tributed to its members, directors, or officers. Such cor­poration may pay compensation in a reasonable amount to its members, directors, and officers for services ren­dered, may confer benefits upon its members in con­formity with its purposes, and upon dissolution or final liquidation may make distributions to its members as permitted by the court having jurisdiction thereof; any such corporation which is a utility exempt from regula­tion under s. 367.022(7) whose articles of incorporation state that it is intended to qualify under s. 501 (c)(12) of the Internal Revenue Code may make such refunds to its members, prior to a dissolution or liquidation, as are deemed necessary by its managing board to establish or preserve its status under s. 501 (c)(12); and no such payment, benefit, distribution, or refund shall be deemed to be a dividend or a distribution of income.

(2) A corporation organized upon a stock share ba­sis shall issue shares of stock in the denominations pro­vided in its articles of incorporation, and the shares of stock shall be evidenced by stock certificates which shall contain a statement, printed prominently upon the face of the certificate, that the corporation is a nonprofit corporation. Unless provided otherwise in the articles of incorporation, each share shall entitle the holder thereof to one vote. No dividends shall be paid, and no part of the income of the corporation shall be distributed, to its shareholders, directors, or officers . A corporation may pay compensation in a reasonable amount to its officers and directors for services rendered and may confer ben­efits upon its shareholders in conformity with its pur­poses.

Hlatory.-s. 2, ch. 59-427: s. 1, ch. 82-147 ; s. 74, ch. 83-216; s. 2, ch. 87-542. 'Note.-As amended by s. 2, ch . 87-542, effective October 31 , 1987.

617.012 Reincorporation.-(1) Any corporation which has a charter approved by

a circuit judge, under this chapter and the laws from which derived , or a charter granted by the Legislature of this state, on or prior to September 1, 1959, the effec­tive date of chapter 59-427, Laws of Florida, may rein­corporate hereunder by filing with the Department of State a copy of its charter and all amendments thereto, certified by the clerk of the circuit court of the county wherein recorded, as to charters and amendments granted by circuit judges, and by the Department of State, as to legislative charters, together with a certifi­cate containing the provisions required in original arti­cles of incorporation by s. 617.013, and accepting the provisions of this chapter, as amended.

(2) Said certificate shall be executed by its presi­dent and attested by its secretary under the corporate seal, if any, and it shall show that its issuance was duly authorized by a meeting of its members regularly called, or if its members have no voting rights , by meeting of its board of directors, managers, or trustees regularly called. Upon the filing thereof and payment of the filing

357

Ch.617 CORPORATIONS NOT FOR PROFIT F.S. 1987

fees specified in s. 617.015, for filing articles of incorpo­ration , the corporation shall be deemed to be incorporat­ed hereunder and the certificate shall constitute its art i­cles of incorporation hereunder.

(3) The corporation shall then be entitled to and be possessed of all the privileges, franchises, and powers as if originally incorporated under this chapter , as amended ; and all the properties, rights, and privileges theretofore belonging to the corporation , which were ac­quired by gift , grant, conveyance, assignment, or other­wise shall be and they are hereby ratified, approved , confirmed, and assured to the corporation with like ef­fect and to all intents and purposes as if they had been originally acquired through incorporation under this chapter, as amended ; provided , however, that any cor­poration thus reincorporating hereunder shall be subject to all the contracts, duties, and obligations theretofore resting upon the corporation or to which the corporation shall then be in any way liable.

History.-s. 3, ch. 59-427; s. 1, ch. 63-405; ss. 10, 35, ch. 69-Hl6.

617.013 Incorporators; articles of incorporation; execution; content; delivery and filing.-

(1) One or more persons or a domestic or foreign corporation , partnership, limited partnership, or associa­tion may act as incorporator or incorporators of a corpo­ration under this chapter by signing and delivering, or causing to be delivered, articles of incorporation for such corporation to the Department of State.

(2) The articles of incorporation shall be executed by the incorporator or incorporators and acknowledged by one of the incorporators signing such articles and shall set forth :

(a) The name of the corporation . (b) The duration of the corporation if other than per­

petual and the date and time of the commencement of the corporate existence if other than the time of the fi ling of the articles of incorporation by the Department of State.

(c) The purpose or purposes for which the corpora­tion is organized.

(d) The qualifications for members and the manner of their admission, which may be stated to be as regulat­ed by the bylaws.

(e) The street address of its initial registered office and the name of its initial registered agent at such ad­dress.

(f) The number of directors constituting the initial board of directors, managers, or trustees, which shall not be less than three, and the name and address of each person who is to serve as an initial director, manag­er, or trustee. Whether they are called directors, manag­ers, or trustees, the board members shall have the rights and duties of directors under chapter 607 .

(g) The name and address of each incorporator. (3) The articles of incorporation may, as a matter of

election, also set forth : (a) The names of any persons, or the designation of

any group of persons, who are to be the initial members. (b) Any provision, not inconsistent with law, which

the incorporator or incorporators may elect to set forth in the articles of incorporation for the conduct of the af­fairs of the corporation ; any provision creating, defining,

limiting , and regulating the powers of the corporation , the directors, managers, or trustees, and the members, including , but not limited to , any provision establishing classes of membership, any provision limiting voting rights to one or more of such classes, and any provision for cumulative voting for directors, managers, or trust­ees; and any provision which under this chapter is re­quired or permitted to be set forth in the bylaws. Any such provision set forth in the articles of incorporation need not be set forth in the bylaws.

(4) It shall not be necessary to set forth in the articles of incorporation any of the corporate powers enumerat­ed in this chapter or in chapter 607.

(5) The articles of incorporation shall be delivered to the Department of State. If the Department of State finds that the articles of incorporation conform to law, it shall , when all fees have been paid as prescribed in this chapter, file the articles of incorporation in accordance with s. 607.384.

Hlstory.- s. 4, ch. 59- 427; ss. 10, 35, ch. 69- 106; s. 1, ch. 80-192; s. 9, ch. 82-177. .

617.014 Commencement of corporate existence. -The date when corporate existence shall commence shall be upon the filing of the articles of incorporation by the Department of State, except that the date of com­mencement of corporate existence may be specified in the articles of incorporation :

(1) When the date specified in the articles of incor­poration is the date of subscription and acknowledg­ment and the articles of incorporation are filed by the De­partment of State within 5 days, exclusive of legal holi­days, after such date.

(2) When the date specified in the articles of incor­poration is subsequent to , and not later than 90 days af­ter, the date of filing of the articles of incorporation by the Department of State.

Hlstory.- s. 5, ch. 59-427; ss. 10, 35, ch. 69- 106; s. 10, ch. 82-1 77.

617.015 Filing fees.-Upon filing any articles of in­corporation, amendment thereof, or other paper relating to the incorporation , merger, consolidation, or dissolu­tion of any corporation not for profit with the Department of State, the following fees shall be paid to it for the use of the state:

(1) A fil ing fee of $30 for the filing and approval of ar­ticles of incorporation .

(2) A fee of $5 in each case for furnishing certified copies of articles of incorporation or other documents concerning a corporation not for profit.

(3) A fee of $15 in each case for filing papers relating to dissolution , amendment of articles of incorporation , or a merger or consolidation agreement.

History.-s. 6, ch . 59-427; s. 1, ch. 67-561; ss. 10, 35, ch. 69-1 06; s. 14, ch. 71-114.

617.016 Right to amend the articles of incorpora­tion.-

( 1) A corporation may amend its articles of incorpo­ration from time to time in any and as many respects as may be desired , if such amendment contains only such provision as might be lawfully contained in the original articles of incorporation filed at the time of making such amendment.

358

F.S. 1987 CORPORATIONS NOT FOR PROFIT Ch. 617

(2) In particular, and without limitation upon such general power of amendment, a corporation may amend its articles of incorporation from time to time:

(a) To change its corporate name. (b) To change its period of duration. (c) To change, enlarge, or diminish its corporate pur­

poses. (d) To change classes of membership, voting rights

of one or more of such classes, or cumulative voting. Hiatory.-s. 11, ch. 82-177.

617.017 Procedure to amend articles of incorpora­tion.-

(1) Any corporation which has reincorporated under th;s chapter may amend its articles of incorporation as provided in its articles of incorporation . Any corporation formed before October 1, 1982, which has not reincor­porated under this chapter may amend its articles of in­corporation by resolution as provided in its bylaws . Amendments to the articles of incorporation of all other corporations shall be made in the following manner:

(a) The board of directors, managers, or trustees shall adopt a resolution setting forth the proposed amendment and, if members have been admitted di­recting that it be submitted to a vote at a meeting of members, which may be either the annual or a special meetmg. If no members have been admitted, the amendment shall be adopted by a vote of the majority of d;rectors, managers, or trustees; and the provisions for adoption by members shall not apply.

(b) Within the time and in the manner provided in th;s chapter for the giving of notice of meetings of mem­bers, written notice setting forth the proposed amend­ment or a summary of the changes to be effected there­by shall be given to each member of record entitled to vote thereon. If the meeting is an annual meeting, the proposed amendment or such summary may be includ­ed 1n the not;ce of such annual meeting .

(c) At such meeting, a vote of the members entitled to vote thereon shall be taken on the proposed amend­ment. The proposed amendment shall be adopted upon rece;v;ng the affirmative vote of a majority of the votes of members entitled to vote thereon, unless any class of members is entitled to vote thereon as a class in which event the proposed amendment shall be adopted upon rece;v;ng both the affirmative vote of a majority of the votes of members of each class entitled to vote thereon as a class and the affirmative vote of a majority of the votes of all members entitled to vote thereon.

(2) Any number of amendments may be submitted to the members and voted upon by them at one meet­ing.

(3) If all of the directors, managers, and trustees and all of the members eligible to vote sign a written state­ment manifesting their intention that an amendment to the articles of incorporation be adopted, then the amendment shall thereby be adopted as though sub­sect;on (1) had been satisfied.

(4) Unless otherwise provided in the articles of incor-

to be made is given. Hlstory.-s. 12, ch. 82-177.

617.018 Articles of amendment; execution; con­tent; delivery and filing.-

(1) The articles of amendment shall be executed by the corporation by its president or a vice president and by its secretary or an assistant secretary and acknowl­edged by one of the officers signing such articles and shall set forth:

(a) The name of the corporation . (b) The amendments so adopted . (c) The date of the adoption of the amendment by

the members or by the board of directors, managers, or trustees when no members have been admitted.

(2) The articles of amendment shall be delivered to the Department of State. If the Department of State finds that the articles of amendment conform to law, it shall, when all fees and taxes have been paid as pre­scribed in this chapter, file the articles of amendment in accordance with s. 607.384.

(3) The Department of State shall not approve or file any amendment to the charter of a corporation which may reincorporate under s. 617 .D12, but which has not reincorporated thereunder, unless such corporation has previously filed with the Department of State a copy of ;ts charter and all amendments thereto, certified by the clerk of the circuit court of the county wherein recorded, w;th respect to charters and amendments granted by circuit judges, and certified by the Department of State, w;th respect to legislative charters, together with an affi­davit executed by its president stating that such docu­ments constitute copies of the charter of the corporation and all amendments thereto. Such certified copies and affidavit shall be delivered to the Department of State, which shall , if it finds that the documents conform to law file such documents in accordance with s. 607.384 whe~ all fees and taxes have been paid as prescribed in this chapter .

Hlstory.-s. 13, ch. 82-177.

617.019 Effect of amendment.-( 1) Upon the filing of the articles of amendment by

the Department of State, the amendment shall become effective and the articles of incorporation shall be deemed to be amended accordingly.

(2) Notwithstanding subsection (1), the date an amendment to the articles of incorporation shall become effective may be specified in the articles of amendment; however, in no event shall the effective date be prior to, or more than 90 days after, the filing of the articles of amendment by the Department of State.

(3) No amendment shall affect any existing cause of act;on 1n favor of or against such corporation , any pend­ing suit to which such corporation is a party, or the exist­ing rights of persons other than members. In the event the corporate name is changed by amendment, no suit brought by or against such corporation under its former name shall abate for that reason .

History.-s. 14, ch. 82-177.

poration, the members may amend the articles of incor- 617.0201 Restated articles of incorporation.-poration, without an act of the directors, managers, or (1) A corporation may at any time integrate into a trustees, at a meeting for which notice of the changes single instrument all of the provisions of its articles of in-

359

Ch. 617 CORPORATIONS NOT FOR PROFIT F.S. 1987

corporation which are then in effect and operative as a result of the Department of State's having previously filed articles of incorporation and any amendment there­to.

(2) Restated articles of incorporation may be adopt­ed by the board of directors, managers, or trustees with­out a vote of the members. Restated articles of incorpo­ration shall be specifically designated as such and shall state, either in the heading or in an introductory para­graph, the present name of the corporation and, if it has been changed, the name under which it was originally incorporated and the date of filing of its original articles of incorporation by the Department of State. Restated articles of incorporation shall also state that such arti­cles were duly adopted by the directors, managers, or trustees and that the restated articles of incorporation only restate and integrate and do not further amend the provisions of the articles of incorporation as theretofore amended or that any amendments included therein have been adopted pursuant to subsection (4) and there is no discrepancy between the articles of incorporation as theretofore amended and the provisions of the restat­ed articles of incorporation other than the inclusion of amendments adopted pursuant to subsection (4) and the omission of matters of historical interest.

(3) Restated articles of incorporation shall be exe­cuted, acknowledged, and filed in accordance with the provisions relating to the filing of amendments to articles of incorporation. Upon the filing of restated articles of in­corporation by the Department of State, the original arti­cles of incorporation of the corporation, as theretofore amended , shall be superseded; and thenceforth the re­stated articles of incorporation shall be the articles of in­corporation of the corporation .

(4) Amendments may be made simultaneously with restating the articles of incorporation if the requirements of this chapter with respect to amendments are com­plied with and the provisions being amended are identi­fied. In such event, the amended and restated articles of incorporation shall be specifically designated as such .

History.-s. 15, ch. 82-177; s. 75, ch. 83-216.

617.021 Corporate powers.-Every corporation not for profit organized hereunder, unless otherwise provid­ed in its articles of incorporation or by law, shall have power to:

(1) Have succession by its corporate name for the period set forth in its articles of incorporation.

(2) Sue and be sued and appear and defend in all actions and proceedings in its corporate name to the same extent as a natural person.

(3) Adopt and use a common corporate seal and al­ter the same; provided, however, that such seal shall al­ways contain the words "corporation not for profit."

(4) Elect or appoint such officers and agents as its affairs shall require and allow them reasonable compen­sation .

(5) Adopt, change, amend , and repeal bylaws, not inconsistent with law or its articles of incorporation, for the administration of the affairs of the corporation and the exercise of its corporate powers.

(6) Increase, by a vote of its members cast as the by­laws may direct, the number of its directors, managers,

or trustees so that the number shall not be less than three but may be any number in excess thereof.

(7) Make contracts and incur liabilities, borrow mon­ey at such rates of interest as the corporation may deter­mine, issue its notes, bonds, and other obligations, and secure any of its obligations by mortgage and pledge of all or any of its property, franchises , or income.

(8) Conduct its affairs, carry on its operations, and have offices and exercise the powers granted by this chapter in any state, territory, district, or possession of the United States or any foreign country.

(9) Purchase, take, receive , lease, take by gift, de­vise, or bequest, or otherwise acquire, own, hold , im­prove, use, or otherwise deal in and with real or personal property, or any interest therein , wherever situated .

(10) Acquire, enjoy, utilize and dispose of patents, copyrights, and trademarks and any licenses and other rights or interests thereunder or therein.

(11) Sell , convey , mortgage , pledge , lease, ex­change, transfer, or otherwise dispose of all or any part of its property and assets.

(12) Purchase, take, receive , subscribe for, or other­wise acquire, own , hold , vote, use, employ, sell, mort­gage, lend, pledge, or otherwise dispose of and other­wise use and deal in and with , shares and other interests in , or obligations of, other domestic or foreign corpora­tions, whether for profit or not for profit, associations, partnerships, or individuals, or direct or indirect obliga­tions of the United States, or of any other government, state, territory, governmental district, municipality, or of any instrumentality thereof.

(13) Lend money for its corporate purposes, invest and reinvest its funds , and take and hold real and per­sonal property as security for the payment of funds so loaned or invested.

(14) Make donations for the public welfare or for reli­gious, charitable, scientific, educational , or other similar purposes.

(15) Have and exercise all powers necessary or con­venient to effect any or all of the purposes for which the corporation is organized .

(16) Merge and consolidate with other corporations both for profit and not for profit, domestic and foreign , providecj that the surviving corporation is a corporation not for profit.

Hlstory.- s. 8, ch. 59-427; s. 1, ch. 73-171 ; s. 1, ch. 74-70.

617.022 Estoppel; ultra vires.-(1) No body of persons acting as a corporation here­

under shall be permitted the want of legal organization as a defense to an action against it as a corporation , nor shall any person sued on a contract or sued for an injury to its property or a wrong done to its interests, be per­mitted to set up a want of such organization in his de­fense.

(2) No act of a corporation and no conveyance or transfer of real or personal property to or by a corpora­tion shall be invalid by reason of the fact that the corpo­ration was without capacity or power to do such act or to make or receive such conveyance or transfer, but such lack of capacity or power may be asserted:

(a) In any action by a member or a director against the corporation to enjoin the doing of any act or the

360

F.S. 1987 CORPORATIONS NOT FOR PROFIT Ch.617

transfer of real or personal property by or to the corpora­tion , but in any such action the plaintiff shall sustain the burden of proof that he has not at any time prior thereto assented to the act or transfer in question and that in bringing the action he is not acting in collusion with offi­cials of the corporation. If the unauthorized acts or trans­fer sought to be enjoined are being, or are to be, per­formed or made pursuant to any contract to which the corporation is a party, the court may, if all of the parties to the contract are parties to the action and if deemed equitable, set aside and enjoin the performance of such contract , and in so doing may allow to the corporation or to the other parties to the contract, as the case may be, compensation for the loss or damage sustained by either of them which may result from the action of the court in setting aside and enjoining the performance of such contract , but anticipated profits to be derived from the performance of the contract shall not be awarded by the court as loss or damage sustained .

(b) In an action by the corporation or by its receiver, trustee or other legal representative , or by its members in a representative suit, against the incumbent or former officers or directors of the corporation .

(c) In an action by the Department of Legal Affairs under the provisions of s. 617.09 or s. 617.11 (4) .

History.- s. 9, ch . 59-427; ss. 11 , 35, ch . 69-106.

617.023 Registered office and registered agent­The provisions of ss . 607.034 and 607.037 apply to cor­porations not for profit.

History.-s. 10, ch. 59-427; ss. 10, 35, ch. 69-106; s. 16, ch . 82-177.

617.026 Board of directors, managers, or trustees. -All corporate powers shall be exercised by or under the authority of , and the affairs of a corporation shall be managed under the direction of, a board of directors, managers, or trustees, except as may be otherwise pro­vided in this chapter, in chapter 607, or in the articles of incorporation . However, the board shall consist of at least three persons . If the articles of incorporation pro­vide that the directors, managers, or trustees are elect­ed otherwise than by the members, such provision shall control over chapter 607 . Each director, manager, or trustee of such board shall have the rights and duties of a director under the provisions of chapter 607 to the extent that such rights and duties are consistent with the provisions of this chapter. All references in chapter 607 to "shareholders" in providing for the rights and du­ties of directors mean "members" when such provisions apply to a corporation not for profit.

History.-s. 17, ch. 82-177.

617.028 Indemnification and liability of officers, di­rectors, managers, trustees, employees, and agents. -Except as provided ins. 617.0285, the provisions of ss. 607.014, 607.1645, and 607.165 apply to corpora­tions not for profit and rural electric cooperatives orga­nized under chapter 425. Any reference to "directors" in those sections includes the directors, managers, or trustees of a corporation not for profit or of a rural elec­tric cooperative organized under chapter 425, provided that the term "director" as used in s. 607.1645 shall not include a director appointed by the developer to the board of directors of a condominium association under

361

chapter 718 or a cooperative association under chapter 719. Any reference to "shareholders" in those sections includes members of a corporation not for profit and members of a rural electric cooperative organized under chapter 425.

History.-s. 18, ch. 82-177 ; s. 4, ch. 87-245.

617.0285 Officers and directors of certain corpora­tions and associations not for profit; immunity from civ­il liability.-

(1) An officer or director of a nonprofit organization recognized under section 501 (c)(3) or section 501 (c)(4) or section 501 (c)(6), or of an agricultural or a horticultural organization recognized under section 501 (c)(5), of the Internal Revenue Code of 1986, as amended , is not per­sonally liable for monetary damages to any person for any statement, vote, decision , or failure to take an ac­tion , regarding organizational management or policy by an officer or director, unless:

(a) The officer or director breached or failed to per­form his duties as an officer or director; and

(b) The officer's or director's breach of, or failure to perform, his duties constitutes:

1. A violation of the criminal law, unless the officer or director had reasonable cause to believe his conduct was lawful or had no reasonable cause to believe his conduct was unlawful. A judgment or other final adjudi­cation against an officer or director in any criminal pro­ceeding for violation of the criminal law estops that offi­cer or director from contesting the fact that his breach , or failure to perform, constitutes a violation of the crimi­nal law, but does not estop the officer or director from establishing that he had reasonable cause to believe that his conduct was lawful or had no reasonable cause to believe that his conduct was unlawful ;

2. A transaction from which the officer or director derived an improper personal benefit, either directly or indirectly; or

3. Recklessness or an act or omission which was committed in bad faith or with malicious purpose or in a manner exhibiting wanton and willful disregard of hu­man rights , safety, or property.

(2) For the purposes of this section, the term: (a) "Recklessness" means the acting, or omission to

act, in conscious disregard of a risk: 1. Known, or so obvious that it should have been

known, to the officer or director; and 2. Known to the officer or director, or so obvious

that it should have been known, to be so great as to make it highly probable that harm would follow from such action or omission.

(b) "Director" means a person who serves as a direc­tor, trustee, or member of the governing board of an or­ganization.

(c) "Officer" means a person who serves as an officer without compensation except reimbursement for actual expenses incurred or to be incurred .

Hlstory.-s. 2, ch. 87-245.

617.03 Effect of certificate of incorporation.-The certificate of incorporation issued by the Department of State, and the original recorded charter or certified copy of the charter of a corporation which may be but has not been reincorporated under s. 617.012, shall be conclu-

Ch. 617 CORPORATIONS NOT FOR PROFIT F.S. 1987

sive evidence that all conditions precedent required to be performed by the incorporators have been complied with and that the corporation has been incorporated un­der this chapter, except as against this state in a pro­ceeding to cancel or revoke the certificate of incorpora­tion or for involuntary dissolution of the corporation.

Hlstory.-RS 2260; GS 2831 ; RGS 4500; CGL 6496; s. 11 , ch. 59-427; ss. 10, 35, ch . 69-106; s. 19, ch. 82-177.

617.041 Members.-(1 )(a) The quorum and voting requirements for

meetings and activities of the membership, and notice requirements sufficient to provide notice of meetings and activities of the membership, may be provided by the articles of incorporation or by the bylaws of the cor­poration.lf such requirements are not established by the articles of incorporation or bylaws of the corporation, the provisions of chapter 607 relating to meetings and activi­ties of shareholders shall apply to meetings and activi­ties of members of a corporation not for profit. The arti­cles of incorporation or bylaws of any corporation not for profit which maintains chapters or affiliates may grant representatives of such chapters or affiliates the right to vote in conjunction with the board of directors of the cor­poration without regard to the quorum requirements of chapter 607, provided the corporation is registered with the Department of State pursuant to the Solicitation of Charitable Funds Act.

(b) This subsection does not apply to any condomin­ium association organized pursuant to chapter 718.

(2) The corporation shall keep a membership book containing the name and address of each member. The corporation shall also keep books and records in accord­ance with the provisions of s. 607.157 which are consist­ent with this chapter.

(3) The corporation may issue certificates of mem­bership.

(4) Membership in the corporation may be terminat­ed in the manner provided by law, by the articles of in­corporation, or by the bylaws; and a termination of mem­bership shall be recorded in the membership book. Un­less otherwise provided in the articles of incorporation or bylaws, all the rights and privileges of a member shall cease on termination of membership.

Hlstory.-s. 20, ch. 82-177; s. 1, ch . 83-104. cl.-s. 496.03 Registration of charitable organizations.

617.05 Dissolution.-(1) Any corporation organized hereunder wishing to

dissolve may present a petition therefor to the circuit court of the county in which the principal office of the corporation is located. The circuit judge shall direct no­tice thereof to be published for such time as he may deem to be expedient, and after the expiration of such time he may decree a dissolution and may make all nec­essary orders and decrees for the winding up of the af­fairs of such corporation, taking care that the claims of creditors be satisfied as far as may be out of the assets of the corporation. Upon filing a certified copy of the de­cree of dissolution with the Department of State and the payment of all filing fees, the corporation shall be dis­solved; provided , that in the case of corporations hereto­fore incorporated hereunder and not reincorporated, the decree of dissolution shall also be recorded in the office

of clerk of the circuit court which approved the charter of the corporation.

(2) When any corporation organized hereunder is defunct, the circuit court of the county in which the last known principal office of the corporation is located or the circuit court which approved the charter of the corpora­tion may decree a dissolution of such corporation upon the sworn petition of any person. Notice thereof shall be served by the petitioner by mail to the last known offi­cers and agents of such corporation, specifying the date and time when the petition shall be presented to the cir­cuit judge. In addition, the circuit judge shall direct no­tice to be published for such time as he shall deem to be expedient. Upon the presentation of proof of such service and publication of notice, which may be by affi­davit, if the circuit judge shall find from the evidence presented that the corporation is defunct, he may de­cree a dissolution and make all necessary orders and decrees for the winding up of the affairs of such corpora­tion, taking care that the claims of creditors be satisfied as far as may be out of the assets of the corporation. The circuit judge may in his discretion direct that the costs of the proceeding be satisfied out of the assets of the corporation after the claims of creditors, if any, are satis­fied. Upon filing a certified copy of the decree of dissolu­tion with the Department of State and the payment of all filing fees, the corporation shall be dissolved; provid­ed, that in the case of corporations heretofore incorpo­rated hereunder, the decree of dissolution shall also be recorded in the office of the clerk of the circuit court which approved the charter of the corporation.

Hlstory.-s. 2262 RS 1892; GS 2836; RGS 4506; CGL 6502; s. 13, ch. 59-427; ss. 10, 35, ch . 69-106.

617.051 Merger.-(1 )(a) Any two or more domestic corporations orga­

nized hereunder may merge into one of such corpora­tions pursuant to a plan of merger approved in the man­ner provided in this chapter.

(b) Any corporation organized under chapter 608 be­fore January 1, 1976, or under chapter 607 may merge into a corporation organized hereunder, provided the lat­ter corporation is the surviving corporation. The provi­sions of chapter 607 dealing with merger shall apply to a corporation organized under that chapter, and the merger provisions of this chapter shall apply to a corpo­ration organized hereunder.

(2) Each corporation shall adopt a plan of merger setting forth:

(a) The names of the corporations proposing to merge, and the name of the corporation into which they propose to merge, which is hereinafter designated as the "surviving corporation."

(b) The terms and conditions of the proposed merg­er.

(c) A statement of any changes in the articles of in­corporation of the surviving corporation to be effected by such merger.

(d) Such other provisions with respect to the pro­posed merger as are deemed necessary or desirable.

Hlstory.-s. 14, ch . 59-427; s. 2, ch. 74-70; s. 1, ch. 77-174; s. 76, ch. 83-216.

617.052 Consolidation.-(1) Any two or more domestic corporations orga-

362

F.S. 1987 CORPORATIONS NOT FOR PROFIT Ch.617

nized hereunder may consolidate into a new corporation pursuant tQ a plan of consolidation approved in the man­ner provided in this chapter.

(2) Each corporation shall adopt a plan of consolida­tion setting forth:

(a) The names of the corporations proposing to con­solidate, and the name of the new corporation into which they propose to consolidate, which is hereinafter desig­nated as the "new corporation."

(b) The terms and conditions of the proposed con­solidation.

(c) With respect to the new corporation, all of the statements required to be set forth in articles of incorpo­ration for corporations organized under this chapter .

(d) Such other provisions with respect to the pro­posed consolidation as are deemed necessary or desir­able.

History.-s. 15, ch. 59-427.

617.0525 Consolidation or merger of domestic and foreign corporations.-

(1) When a foreign corporation not for profit is authorized by the law of the state or place of incorpora­tion to effect a merger or consolidation with a corpora­tion not for profit foreign to that state or place, a merger or consolidation of a domestic corporation not for profit with such a foreign corporation may be effected.

(2) In case of consolidation, the new corporation may be incorporated under the laws of any state or place under which a constituent corporation was incor­porated. In case of merger, the surviving corporation may be any constituent corporation . With respect to any constituent corporation, the provisions, forms, or man­ner of execution and acknowledgment of the agreement of merger or consolidation, and the certification of the proceedings for adoption of the agreement, may be ef­fected in accordance with the laws of the state or place of incorporation, or proposed incorporation, of the sur­viving or new corporation.

(3) When a domestic corporation merges or consoli­dates with a foreign corporation pursuant to the law of a state or place other than this state, the single corpora­tion shall file for record with the Department of State of this state a copy of the agreement of merger or consoli­dation, certified by the proper official of such other state or place. Before such foreign corporation may transact any business in this state it shall comply with s. 617.11.

(4) If the consolidated or merged corporation is to be a Florida corporation , the plan of consolidation or merger shall be adopted, signed and acknowledged, and filed with the Department of State pursuant to ss. 617.053 and 617.054.

Hlstory.-s. 2. ch. 73-171 .

617.053 Approval of merger or consolidation.­(1) A plan of merger or consolidation shall be adopt­

ed in the following manner: (a) Where the members of any merging or consoli­

dating corporation have voting rights, the board of direc­tors, managers, or trustees of such corporation shall adopt a resolution approving the proposed plan and di­recting that it be submitted to a vote at a meeting of members having voting rights, which may be either an annual or a special meeting. Written or printed notice

setting forth the proposed plan or a summary thereof shall be given to each member entitled to vote at such meeting within the time and in the manner provided in the bylaws for the giving of notice of meetings of mem­bers. The proposed plan shall be adopted upon receiv­ing at least two-thirds of the votes which members pres­ent at such meeting or represented by proxy are entitled to cast.

(b) Where any merging or consolidating corporation has no members, or no members having voting rights, a plan of merger or consolidation shall be adopted at a meeting of the board of directors, managers, or trustees of such corporation upon receiving the vote of a majority of the members of the board.

(2) After such approval, and at any time prior to the filing of the articles of merger or consolidation, the merg­er or consolidation may be abandoned pursuant to provi­sions therefor, if any, set forth in the plan of merger or consolidation.

Hlstory.-s. 16, ch . 59-427.

617.054 Articles of merger or consolidation.-(1) Upon such approval, articles of merger or articles

of consolidation shall be executed in duplicate by each corporation by its president or a vice president and by its secretary or an assistant secretary, and verified by one of the officers of each corporation signing such arti­cles, and shall set forth:

(a) The plan of merger or the plan of consolidation . (b) Where the members of any merging or consoli­

dating corporation have voting rights, then as to each such corporation a statement setting forth the date of the meeting of members at which the plan was adopted, that a quorum was present at such meeting, and that such plan received at least two-thirds of the votes which members present at such meeting or represented by proxy were entitled to cast; or a statement that such amendment was adopted by a consent in writing signed by all members entitled to vote with respect thereto.

(c) Where any merging or consolidating corporation has no members, or no members having voting rights, then as to each such corporation a statement of such fact, the date of the meeting of the board of directors, managers, or trustees at which the plan was adopted and a statement of the fact that such plan received the vote of a majority of the members of the board.

(2) The original and a duplicate copy of the articles of merger or articles of consolidation shall be delivered to the Department of State. If the Department of State finds that such articles conform to law, it shall, when all fees have been paid as in this chapter prescribed :

(a) Endorse its approval on the original with the date and time of approval.

(b) File the original in the records of the department. (c) Issue a certificate of merger or a certificate of

consolidation to which it shall affix the duplicate copy. (3) The certificate of merger or certificate of consoli­

dation, together with the duplicate copy of the articles of merger or articles of consolidation affixed thereto by the Department of State shall be returned to the person from whom the articles were received .

History.-s. 17, ch. 59-427; ss. 10, 35, ch. 69-106.

363

Ch.617 CORPORATIONS NOT FOR PROFIT F.S. 1987

617.055 Effective date of merger or consolidation. -Upon the issuance of the certificate of merger, or the certificate of consolidation by the Department of State, the merger or consolidation shall be effected.

Hlstory.-s. 18, ch. 59-427; ss. 10, 35, ch . 69-106.

617.056 Effect of merger or consolidation.-When such merger or consolidation has been effected:

(1) The several corporations parties to the plan of merger or consolidation shall be a single corporation, which, in the case of a merger, shall be that corporation designated in the plan of merger as the surviving corpo­ration, and, in the case of a consolidation, shall be the new corporation provided for in the plan of consolida­tion.

(2) The separate existence of all corporations par­ties to the plan of merger or consolidation, except the surviving or new corporation, shall cease.

(3) Such surviving or new corporation shall have all the rights , privileges, immunities, and powers and shall be subject to all the duties and liabilities of a corporation organized under this chapter.

(4) Such surviving or new corporation shall there­upon and thereafter possess all the rights , privileges, im­munities, and franchises, as well of a public as of a pri­vate nature, of each of the merging or consolidating cor­porations; and all property, real , personal, and mixed, and all debts due on whatever account, and all other choses in action, and all and every other interest, of or belonging to or due to each of the corporations so merged or consolidated, shall be taken and deemed to be transferred to and vested in such single corporation without further act or deed; and the title to any real es­tate, or any interest therein, vested in any of such corpo­rations shall not revert or be in any way impaired by rea­son of such merger or consolidation .

(5) Such surviving or new corporation shall thence­forth be responsible and liable for all the liabilities and obligations of each of the corporations so merged or consolidated ; and any claim existing or action or pro­ceeding pending by or against any of such corporations may be prosecuted as if such merger or consolidation had not taken place, or such surviving or new corpora­tion may be substituted in its place. Neither the rights of creditors nor any liens upon the property of any such corporation shall be impaired by such merger or consoli­dation.

(6) In the case of a merger, the articles of incorpora­tion of the surviving corporation shall be deemed to be amended to the extent, if any, that changes in its articles of incorporation are stated in the plan of merger; and, in the case of a consolidation , the statements set forth in the articles of consolidation and which are required or permitted to be set forth in the articles of incorporation of corporations organized under this chapter shall be deemed to be the articles of incorporation of the new corporation.

History.-s. 19, ch. 59-427.

617.09 Proceedings to revoke articles of incorpo­ration or charter or prevent its use.-ln the event any member or citizen shall complain to the Department of Legal Affairs that any corporation organized under this chapter was organized or is being used as a cover to

evade any of the laws against crime, or for purposes in­consistent with those stated in its articles of incorpora­tion or charter, and shall submit prima facie evidence to sustain such charge, together with sufficient money to cover court costs and expenses, the said department forthwith shall institute and in due course prosecute to final judgment such legal or equitable proceedings as may be considered advisable either to revoke the arti­cles of incorporation or charter or prevent its improper use.

History.-s. 5, ch. 4898, 1901 ; GS 2839; RGS 4509; CGL 6505; s. 23, ch . 59-427 ; ss. 11 , 35, ch. 69-106.

617.10 Bylaws.-Any corporation organized under this chapter may, in its bylaws:

(1) Delegate to its board of directors, managers, or trustees full discretionary power of admitting or expel­ling members;

(2) Prescribe that an incorporator or member shall not have any vested right, interest, or privilege of, in, or to the assets, functions, affairs, or franchises of the cor­poration, or any right, interest, or privilege which may be transferable or inheritable, or which shall continue if his membership ceases, or while he is not in good standing; provided , that before his membership shall cease against his consent he shall be given an opportunity to be heard, unless he is absent from the county where the corporation is located ; and

(3) Delegate to its board of directors, managers, or trustees the power of fixing regular or special dues and assessing fines in such sums as may be fixed, or the lim­its or occasions determined, by said bylaws . The amount of dues so fixed shall become, on and after no­tice, an indebtedness to the corporation collectible by due course of law. The failure to pay any dues or fines assessed shall render the member liable to expulsion.

History.-ss. 1-4, ch. 4898, 1901 ; GS 2837, 2838; RGS 4507, 4508; CGL 6503, 6504; s. 24, ch. 59-427.

617.11 Foreign nonprofit corporations; qualifica­tions.-

(1) Any corporation not for profit duly incorporated under the laws of any other state or territory and which desires to carry on, in the state, the objects and pur­poses of its incorporation may file with the Department of State a duly authenticated copy of its charter or arti­cles of incorporation, together with a filing fee of $60.

(2) Upon the filing of such copy of its charter or arti­cles of incorporation, and the payment of the fee afore­said, and the objects of the corporation are such as are not prohibited by or contrary to the laws of this state, the Department of State shall issue a permit to such corpo­ration to carry on in the state the objects and purposes of its incorporation.

(3) Any foreign corporation not for profit failing to ob­tain such permit, and its successors and assigns, shall not be permitted to bring or maintain any suit or other proceeding before any court or administrative body of this state; but failure to obtain such permit shall not af­fect the validity of any contract with or conveyance by such foreign corporation.

(4) In the event any member or citizen shall complain to the Department of Legal Affairs that any foreign cor­poration permitted under this chapter to carry on in this

364

F.S. 1987 CORPORATIONS NOT FOR PROFIT Ch. 617

state the objects and purposes of its incorporation, or doing business in this state, was organized or is being used in this state as a cover to evade any of the laws against crime, or for purposes inconsistent with those stated in its articles of incorporation or charter, and shall submit prima facie evidence to sustain such charge, to­gether with sufficient money to cover court costs and expenses, the said department forthwith shall institute and in due course prosecute to final judgment such le­gal or equitable proceedings as may be considered ad­visable either to revoke the permit, to prevent its improp­er use, or to prevent such foreign corporation from exer­cising its corporate powers within this state.

History.-ss. 1-3, ch. 11909, 1927; CGL 6506-6508; s. 25, ch. 59- 427; s. 2, ch. 67-561 ; ss. 10, 11 , 35, ch. 69-106; s. 15, ch. 71-114.

617.12 Extinct churches and religious societies; property.-Property, both real and personal, belonging to or held in trust for any church or any religious society belonging to any religious denomination in this state that has or shall become extinct, shall vest in and become the property of that denomination of which the said church or religious society is a member; provided, that nothing herein contained shall affect the title to any property that is now held by any of the denominational associations or organizations of the state; and provided further, that this section shall not affect the reversionary interest of any person in such property or any valid lien thereon.

History.-s. 1, ch. 16291 , 1933; CGL 1936 Supp. 6508(1); s. 26, ch. 59-427.

617.13 Extinct churches and religious societies; dissolution.-Any church or religious society in this state which has ceased or failed to maintain religious worship or service, or to use its property for religious worship or services according to the tenets, usages and customs of a church of the denomination of which it is a member in this state for the space of 2 consecutive years immediately prior thereto, or whose membership has so diminished in numbers or in financial strength as to render it impossible for such church or society to maintain religious worship or services, or to protect its property from exposure to waste and dilapidation for a period of 2 years, shall be deemed and taken to be ex­tinct; and upon the facts being duly established to the satisfaction of the circuit court in and for the county in which such church or society has been theretofore situ­ated, an order of such court may be made dissolving said church or religious society and the property of such church or society, or the property which may be held in trust for such church or society, may in said order be transferred to and the title and possession thereof vest­ed in the denomination of which said church or society shall have been a member. A copy of the decree of dis­solution shall be filed with the Department of State.

History.-s. 2, ch. 16291 , 1933; CGL 1936 Supp. 6508(2); s. 27, ch . 59-427; ss. 10, 35, ch . 69-106.

617.14 Incorporation of labor unions or bodies.­Any group or combination of groups of working men or wage earners, bearing the name labor, organized labor, federation of labor, brotherhood of labor, union labor, union labor committee, trade union, trades union, union labor council, building trades council, building trades union, allied trades union, central labor body, centralia-

bor union, federated trades council, local union , state union, national union, international union, district labor council, district labor union, American Federation of La­bor, Florida Federation of Labor, or the component parts thereof, or the significant words therein, whether the same be used in juxtaposition or with interspace, may be incorporated under this chapter, provided, however:

(1) In addition to the requirements of s. 617.013, the articles of incorporation shall set forth the necessity for the incorporation, and shall be subscribed to by not less than five persons, and shall be acknowledged by all of the subscribers, who shall also make and subscribe to an oath, to be endorsed on the articles of incorporation, that it is intended in good faith to carry out the purposes and objects therein set forth. The articles of incorpora­tion shall be filed in the office of the clerk of the circuit court of the proper county, and the approval of the judge of the circuit court shall be obtained.

(2) The subscribers of the articles of incorporation shall give notice of their intention to obtain approval thereof by the circuit judge. Such notice shall state the name of the judge, the date the articles of incorporation will be presented, the general nature of the articles of in­corporation and the necessity therefor. Notice shall be published in a newspaper of general circulation in said county at least once, or posted at the courthouse door in counties having no newspapers, at least 10 days prior to the date the articles of incorporation will be presented to the judge.

(3) When presented to the judge, the articles of in­corporation shall be accompanied by a petition, signed and sworn to by the subscribers, stating fully the aims and purposes of such organization and the necessity therefor.

(4) Upon the filing of the articles of incorporation and the petition, and the giving of such notice, the circuit judge to whom such petition may be addressed shall, upon the date stated in such notice, take testimony and inquire into the admissions and purposes of such organi­zation and the necessity therefor, and upon such hear­ing , if the circuit judge shall be satisfied that the allega­tions set forth in the petition and articles of incorporation have been substantiated, and shall find that such orga­nization will not be harmful to the community in which it proposes to operate, or to the state, and that it is in­tended in good faith to carry out the purposes and ob­jects set forth therein, and that there is a necessity therefor, the judge shall approve the articles of incorpo­ration and endorse his approval thereon. Upon the filing of the articles of incorporation with its endorsements thereupon with the Department of State and payment of the filing fees specified in s. 617.015, the subscribers and their associates and successors shall be a corpora­tion by the name given.

(5) Any person shall have the right to intervene by filing an answer to the said petition stating his reasons, if any, and be heard thereon, why the circuit judge shall not approve the articles of incorporation.

(6) The existence, amendment of the articles of in­corporation , and dissolution of any such corporation shall be in accordance with this chapter.

History.-ss. 1-8, ch. 19271 , 1939; CGL 1940 Supp. 6526(4)-(11); s. 28, ch. 59-427; ss. 10, 35, ch. 69-106. cf.-ch. 448 General labor regulations.

365

Ch. 617 CORPORATIONS NOT FOR PROFIT F.S. 1987

617.15 Sponge packing and marketing corpora­tions.-Persons engaged in the business of buying, sell­ing, packing, and marketing commercial sponges may incorporate under the provisions of this chapter to aid in facilitating the orderly cooperative buying, selling, packing, and marketing of commercial sponges; and no such association shall be deemed to be a combination in restraint of trade or an illegal monopoly or an attempt to lessen competition or fix prices arbitrarily, nor shall any marketing contract or agreement by the corporation and its members, or the exercise of any power granted by this chapter, be considered illegal or in restraint of trade.

Hlstory.-ss. 1-5, ch . 17805, 1937; CGL 1940 Supp. 6508(4)-(8); s. 29, ch. 59-427.

617.16 Corporations for profit; when may become corporations not for profit.-Any corporation for profit now or hereafter incorporated under any of the laws of the state, engaged solely in carrying out the purposes and objects for which corporations not for profit are authorized under the laws of Florida to carry out, is here­by authorized and empowered to change its corporate nature from a corporation for profit to that of a corpora­tion not for profit as defined in this chapter, by filing a petition in the circuit court of the county wherein its prin­cipal place of business is located in the name of the cor­poration signed by an officer of the corporation and un­der its corporate seal setting forth the purposes and ob­jects in which it is solely engaged, and requesting that the nature of the corporation be changed; provided, that any profit corporation, which has transferred, or is in the process of transferring, its functions and assets to a nonprofit corporation by proceedings under this chapter shall, upon the recital of the facts, circumstances, and intentions surrounding such transfer proceedings in a petition filed in accordance with s. 617.17, and the sub­sequent approval thereof by the circuit judge to whom presented , be deemed to have acted under this chapter and such nonprofit corporation shall succeed to the rights, liabilities, and assets of its corporate predecessor as fully and completely as if the original petition had been filed under the provisions of this chapter.

History.-s. 1, ch. 22657, 1945; s. 1, ch. 57-90; s. 30, ch. 59-427.

617.17 Conversion to corporation not for profit; pe­tition and contents.-Said petition shall be accompa­nied by the written consent of all the stockholders autho­rizing the change in the corporate nature and directing an authorized officer to file such petition before the court, together with proposed articles of incorporation signed by the president and secretary of the petitioning corporation which shall set forth the provisions required in original articles of incorporation by s. 617.013, and in

addition shall contain a provision agreeing to accept all the property of the petitioning corporation and agreeing to assume and pay all its indebtedness and liabilities.

Hlstory.-s. 2, ch. 22657, 1945; s. 31, ch. 59-427.

617.18 Conversion to corporation not for profit; au­thority of circuit judge.-lf the circuit judge to whom the petition and proposed articles of incorporation are pres­ented finds that the petition and proposed articles are in proper form, he shall approve the articles of incorpora­tion and endorse his approval thereon; such approval shall provide that all of the property of the petitioning corporation shall become the property of the successor corporation not for profit, subject to all indebtedness and liabilities of the petitioning corporation. The articles of incorporation with such endorsements thereupon shall be sent to the Department of State, which shall, upon receipt thereof and upon payment of all taxes due the state by the petitioning corporation, if any, issue a certificate showing the receipt of the articles of incorpo­ration with the endorsement of approval thereon and of the payment of all taxes to the state. Upon payment of the filing fees specified in s. 617.015, the Department of State shall file the articles of incorporation, and from thenceforth the petitioning corporation shall become a corporation not for profit under the name adopted in the articles of incorporation and subject to all the rights , powers, immunities, duties, and liabilities of corpora­tions not for profit under the laws of Florida, and its rights, powers, immunities, duties, and liabilities as a corporation for profit shall cease and determine.

Hlatory.-s. 3, ch. 22657, 1945; s. 32, ch. 59-427; ss. 10, 35, ch. 69-106.

617.19 Application of chapter to corporation con­verted to corporation not for profit.-AII the provisions of this chapter relating to corporations not for profit orga­nized hereunder, except insofar as they are inconsistent herewith, shall be applicable to any corporation whose character has been changed hereunder and shall henceforth govern such corporation.

Hlstory.-s. 4, ch. 22657, 1945; s. 33, ch. 59-427.

617.21 Corporations not for profit; when authorized to act as trustee.-Any corporation not for profit, orga­nized under this chapter, is authorized to act as trustee of property whenever the corporation has either a bene­ficial, contingent, or remainder interest in said property; and any such corporation may likewise accept and hold the legal title to property, the beneficial interest of which is owned by any other eleemosynary institution or non­profit corporation or fraternal , benevolent, charitable, or religious society or association .

Hlstory.-s. 1, ch. 25346, 1949; s. 34, ch. 59-427.

366

F.S. 1987 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS Ch.618

CHAPTER 618

AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS

618.01 618.02 618.03 618.04 618.05 618.06 618.07 618.08 618.09 618.10 618.11 618.12 618.13 618.14 618.15 618.16 618.17 618.18 618.19

618.20 618.21 618.22

618.221 618.23 618.24 618.25 618.26

618.27 618.28

Definitions. Who may organize association. Preliminary investigation. Articles of incorporation; fees . Amendment of articles of incorporation . Purposes of incorporation. Powers of corporations. Corporations may mortgage farm supplies. Bylaws. Membership of corporation. How meetings called. Directors ; election. Officers; election . Removal of officers and directors. Capital stock and membership. Referendum upon certain motions. Marketing contracts. Remedies for breach of marketing contract. Contracts and agreements with other like as-

sociations. Purchase of interest in like corporations. Corporations not in restraint of trade. Adoption of provisions of this chapter by prior

corporations. Conversion into a corporation for profit. Quo warranto to test validity of corporation. Application of general corporation laws. Dissolution . Conditions under which foreign similar corpo­

ration may do business in this state. Use of term "cooperative." This chapter not to affect certain laws.

618.01 Definitions.-ln construing this chapter , where the context permits, the word, phrase, or term:

(1) "Agricultural products" shall include aquacultural , horticultural , viticultural, forestry , aquatic, dairy, live­stock, poultry, bee, and any farm products.

(2) "Member" shall include actual members of asso­ciations without capital stock and holders of common stock in associations organized with capital stock.

(3) "Association" means any corporation organized as a cooperative association, for the mutual benefit of its members either as producers of agricultural products or as nonprofit cooperative organizations of producers of agricultural products, or both, and in which the return on the stock or membership capital is limited to an amount not to exceed 8 percent per annum, and in which during any fiscal year thereof the value of busi­ness done with nonmembers shall not exceed the busi­ness done with members during the same period .

(4) Associations organized hereunder shall be deemed "nonprofit ," inasmuch as they are not organized to make profit for themselves, as such, or for their mem­bers, as such , but only for their members as producers.

History.-s. 2, ch. 9300, 1923; CGL 6467; s. 2, ch. 14675, 1931 ; s. 1, ch. 74-88; s. 8, ch. 87- 367.

618.02 Who may organize association.-Three or more persons engaged in the production of any agricul-

tural products , or three or more associations, may form a nonprofit cooperative association under the provisions of this chapter.

Hletory.-s. 3, ch. 9300, 1923; CGL 6488; s. 3, ch. 14675, 1931.

618.03 Preliminary investigation.-Every group of persons contemplating the organization of an associa­tion under this chapter is urged to communicate with the Department of Agriculture and Consumer Services , which will inform it whatever a survey of the marketing conditions affecting the commodities to be handled by the proposed association indicates regarding probable success.

Hletory.-s. 5, ch. 9300, 1923; CGL 6470; s. 5, ch. 14675, 1931 ; ss. 14, 35, ch . 69-106.

618.04 Articles of incorporation; fees.-Each asso­ciation organized under this chapter shall prepare and file articles of incorporation setting forth :

(1) The name of the association , which may or may not include the word "cooperative" or any abbreviation thereof;

(2) The purpose for which it is formed; (3) The place where its principal office within the

state will be located ; (4) Whether the association is to have perpetual ex­

istence and , if not, the term of its existence; (5) The names and addresses (not less than three) ,

of those who are to serve as directors for the first term or until the election of their successors;

(6) If organized without capital stock, whether the property rights and interest of each member shall be equal or unequal ; if unequal, the general rules applicable to all members by which the property rights and interest, respectively , of each member may and shall be deter­mined and fi xed ; and provision for the admission of new members, who shall be entitled to share in the property of the association with the old members, in accordance with such general rules. This provision or paragraph of the articles of incorporation shall not be altered , amend­ed or repealed, except by the written consent or vote of three-fourths of the members;

(7) If organized with capital stock, the amount of such stock and the number of shares into which the cap­ital stock is to be divided, whether all or part of the same shall have a par value, and if so, the par value thereof, whether all or part of the same shall have no par value, and if there is to be more than one class of stock creat­ed , a description of the different classes, the number of shares in each class, and the relative rights, interests, and preferences each class shall represent;

(8)(a) In addition to the foregoing , the articles of in­corporation of any association incorporated hereunder may contain any provision consistent with law with re­spect to management, regulation , government, financ­ing, indebtedness, membership, the establishment of voting districts, and the election of delegates for repre­sentative purposes, the issuance, retirement and trans­fer of its stock, if formed with capital stock or any provi­sions relative to the way or manner in which it shall oper-

367

Ch.618 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS F.S. 1987

ate or with respect to its members, officers, or directors, and any other provisions relating to its affairs.

(b) The articles shall be subscribed by the incorpora­tors and acknowledged by one of them, if individuals, or by the president or any vice president of one of them, if corporations, before an officer authorized by law to take and certify acknowledgments of deeds and con­veyances, and shall be filed with the Department of State accompanied by a fee of $30 which shall be the only fee required therefor; and thereupon the associa­tion shall be and constitute a body corporate under the provisions of this chapter, and a copy of said articles of incorporation certified by the Department of State shall be received in all the courts of this state and other places, as prima facie evidence of the facts contained therein and of the due incorporation of such association .

History.-s. 8. ch. 9300, 1923; CGL 6473; s. 8, ch. 14675, 1931 ; s. 2, ch. 16879, 1935; s. 1, ch. 29813, 1955; ss. 10, 35, ch. 69-106; s. 16, ch. 71-114.

618.05 Amendment of articles of incorporation.­The articles of incorporation may be altered or amended at any regular meeting or any special meeting called for the purpose. An amendment must first be approved by two-thirds of the directors and then adopted by a vote representing a majority of a quorum of the members at­tending a meeting of which notice of the proposed amendment shall have been given. Thereupon the asso­ciation shall make under its corporate seal and the hands of its president or vice president and secretary or assistant secretary, a certificate accordingly, and the president or vice president shall duly execute and ac­knowledge such certificate before an officer authorized by law to take and certify acknowledgments of deeds, and such certificate so executed and acknowledged shall be filed with the Department of State; and upon so filing the same, the articles of incorporation of such as­sociation shall be deemed to be amended accordingly; provided , however, a fee of only $15 shall be required therefor by the Department of State.

History.-s. 9, ch. 9300, 1923; CGL 6474; s. 9, ch. 14675, 1931 ; s. 3, ch. 16879, 1935; ss. 10, 35, ch. 69-106; s. 17, ch. 71-114.

618.06 Purposes of incorporation.-An association may be organized under this chapter for the purpose of engaging in any cooperative activity in connection with the producing , marketing, or selling of agricultural prod­ucts; or with the growing , harvesting, preserving, drying , processing, canning, packing, grading, storing , ware­housing , handling, shipping, or utilizing such products; or the manufacturing or marketing of the byproducts thereof; or in connection with any of the activities men­tioned herein, the manufacturing, selling, or supplying of machinery, equipment or supplies; or in the financing of any of the above-enumerated activities; or in performing or furnishing business or educational services, on a co­operative basis for those engaged in agriculture as bona fide producers of agricultural products or in any one or more of the activities specified herein .

History.- s. 4, ch. 9300, 1923; CGL 6469; s. 4, ch. 14675, 1931.

618.07 Powers of corporations.-Except as the same may be limited in its articles of incorporation, each association organized under this chapter shall have the following powers:

(1) To engage in any activity in connection with the producing, marketing, selling , preserving, growing, har­vesting, drying, processing , manufacturing, canning, packing, grading, warehousing , storing, handling, or uti­lizing of agricultural products or in the manufacturing or marketing of the byproducts thereof; or in any activities in connection with the manufacturing, purchasing , hiring or using supplies, machinery, or equipment; or in the fi­nancing of any of the above-enumerated activities, or in performing business or educational services, on a coop­erative basis, for those engaged in agriculture as bona fide producers of agricultural products; or in any one or more of the activities specified herein;

(2) To borrow money from any source without limita­tion as to amount of corporate indebtedness or liability, with authority to give any kind or form of obligation or se­curity therefor;

(3) To act as the agent or representative of any per­son in any of the above-mentioned activities;

(4) To make loans or advances to members and to their members, to nonmember patrons, and to nonmem­ber patrons of members, with authority to accept there­for any kind , form or type of obligation with or without security; to purchase, endorse, discount, sell , or guaran­tee the payment of any note, draft, bill of exchange, in­denture, bill of sale, mortgage, or other obligation, the proceeds of which have been advanced or used in the first instance for any of the purposes provided for herein; to discount for or purchase from any association orga­nized under the laws of any state, with or without its en­dorsement, any note, draft, bill of exchange, indenture, bill of sale, mortgage, or other obligation the proceeds of which are advanced or used in the first instance for carrying on any cooperative activity authorized in this chapter and with authority to dispose of same with or without endorsement. An association organized under this chapter and exercising any of the powers provided in this subsection shall not engage in the business of banking;

(5) To purchase or otherwise acquire, to hold , own , and exercise all rights of ownership in, and to sell, trans­fer, pledge, or guarantee the payment of dividends or in­terest on , or the retirement or redemption of shares, of capital stock, bonds, or other obligations of any corpora­tion or association, engaged in any directly or indirectly related activity, or in the producing , picking, hauling, packing , shipping , handling , warehousing, financing , canning, preserving , processing , manufacturing, utiliz­ing, marketing , or selling of any of the products handled by the association , or any byproducts thereof;

(6) To establish reserves and to invest the funds thereof in bonds, or in such other property as may be provided in the bylaws;

(7) To buy, hold , and exercise all privileges of owner­ship over such real or personal property, as may be nec­essary or convenient for the conduct and operation of any of the business of the association or incidental thereto;

(8) To sell , convey, and transfer all of the assets of the association ; provided, such sale shall be consented to by not less than two-thirds of its members or by the holders of not less than two-thirds of its common stock, which consent shall be given either in writing, or by vote

368

F.S. 1987 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS Ch.618

at a special meeting of its members or stockholders call­ed for that purpose;

(9) To establish, secure, own, and develop patents, trademarks, and copyrights ;

(10) To do each and everything necessary, suitable or proper for the accomplishment of any one of the pur­poses, or the attainment of any one or more of the ob­jects herein enumerated, or conducive to or expedient for the interest or benefit of the association, and to con­tract accordingly; and in addition, to exercise and pos­sess all powers, rights, and privileges necessary or inci­dental to the purposes for which the association is orga­nized or to the activities in which it is engaged , and any other rights, powers, and privileges granted by the laws of this state to corporations for profit , except such as are inconsistent with the express provisions of this chapter; and to do any such thing anywhere;

(11) No association organized under this chapter, during any fiscal year thereof, shall deal in or handle products, machinery, equipment, supplies, or perform services for and on behalf of nonmembers to an amount greater in value than such as are dealt in, handled , or performed by it for and on behalf of members during the same period.

History.-s. 6, ch. 9300, 1923; CGL 6471; s. 6, ch. 14675, 1931 ; s. 1, ch. 16879, 1935.

618.08 Corporations may mortgage farm supplies. -A mortgage, executed by a cooperative association, may cover its stock of farm supplies, changing in specif­ics, which stock mortgagor is permitted to retain in its possession and sell in the usual course of business. The lien of such mortgage shall be lost on all farm supplies sold up to the time of foreclosure, and shall attach to the farm supplies acquired to replenish the stock. No such mortgage shall be invalid as to creditors of the mortga­gor because the mortgagor is permitted to retain pos­session and sell such mortgaged property in the usual course of business; provided, the mortgagor replenish­es such property from the proceeds of sale or applies such proceeds in payment of the mortgage debt. In all other respects the laws relating to chattel mortgages shall be applicable to such mortgages. The provisions of this section shall not be construed as, in anywise, af­fecting the Bulk Sales Law.

History.-ss. 1, 2, ch. 1711, 1935; CGL 1936 Supp. 6471(1).

618.09 Bylaws.-Each association incorporated un­der this chapter shall adopt for its government and man­agement, a code of bylaws not inconsistent with the powers granted by this chapter. A majority vote of a quo­rum of the members or stockholders attending a meet­ing, of which notice of the proposed bylaws shall have been given, is sufficient to adopt or amend the bylaws. Each association, under its bylaws, may provide for any or all of the following matters:

(1) The time, place, and manner of calling and con­ducting its meetings, which meetings and meetings of its directors, may be held either within or without the state.

(2) The number of stockholders or members consti­tuting a quorum.

(3) The right of members or stockholders to vote by proxy or by mail or both; and the conditions, manner, form, and effects of such votes .

(4) The number of directors constituting a quorum. (5) The qualifications, compensation, and duties

and term of office of directors and officers; time of their election and the mode and manner of giving notice thereof.

(6) Penalties for violations of the bylaws. (7) The amount of entrance, organization, and mem­

bership fees, if any; the manner and method of collection of the same; and the purposes for which they may be used.

(8) The amount which each member or stockholder shall be required to pay annually or from time to time, if at all, to carry on the business of the association; the charge, if any, to be paid by each member or stockhold­er for services rendered by the association to him and the time of payment and the manner of collection; and the form of marketing contract between the association and its members or stockholders, which marketing con­tract shall be binding upon every member or stockhold­er, unless otherwise agreed upon in writing.

(9) The number and qualification of members or stockholders of the association and the conditions pre­cedent to membership or ownership of common stock; the method, time, and manner of permitting members to withdraw or the holders of common stock to transfer their stock; the manner of assignment and transfer of the interest of members and of the shares of common stock; the condition upon which and time when mem­bership of any member shall cease; the automatic sus­pension of the rights of a member when he ceases to be eligible to membership in the association; the mode, manner, and effect of the expulsion of a member; wheth­er a member upon withdrawal, death, or expulsion shall have any interest in the property of the association , if or­ganized without capital stock; the manner of determin­ing the value of the property interest or the shares of common stock of retiring or expelled members, which in­terest or stock may be conclusively appraised by the board of directors of the association and purchased by the association at such value within 1 year after the date of such retirement or expulsion.

History.-s. 10, ch. 9300, 1923; CGL 6475; s. 10, ch. 14675, 1931 ; s. 4, ch. 16879, 1935; s. 7, ch. 22858, 1945.

618.10 Membership of corporation.-(1) Under the terms and conditions prescribed in the

bylaws adopted by it , an association may admit as mem­bers, or issue common stock only to persons engaged in the production of agricultural products and to associa­tions as defined in this chapter.

(2) An association organized hereunder may be­come a member or stockholder of any other association or corporation.

History.-s. 7, ch. 9300, 1923; CGL 6472; s. 7, ch . 14675, 1931 ; s. 7, ch . 22858, 1945.

618.11 How meetings called.-ln its bylaws each association shall provide for one or more regular meet­ings annually. The board of directors shall have the right to call a special meeting at any time, and 10 percent of the members or stockholders may file a petition stating

369

Ch.618 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS F.S. 1987

the specific business to be brought before the associa­tion and demand a special meeting at any time. Such meeting must thereupon be called by the directors. No­tice of all special meetings, together with a statement of the purpose thereof, shall be mailed to each member at least 10 days prior to the meeting; provided, however, that the bylaws may require instead that such notice may be given by publication in a newspaper of general circulation, published at the principal place of business of the association.

History.-s. 11 , ch. 9300, 1923; CGL 6476; s. 11 , ch. 14675, 1931 .

618.12 Directors; election.-(1) The affairs of the association shall be managed

by a board of not less than three directors, to be elected by the members or stockholders, with such qualifica­tions as may be provided for in the articles of incorpora­tion or the bylaws. The bylaws may provide that the terri­tory in which the association has members shall be di­vided into districts and that the directors shall be nomi­nated according to such district, either directly or by dis­trict delegates elected by the members in that district. In such case the bylaws shall specify the number of di­rectors to be nominated by each district, the manner and method of reapportioning the directors and of redis­tricting the territory covered by the association. The by­laws may provide that primary elections shall be held in each district to nominate the directors apportioned to such districts and the result of all such primary elections may be ratified by the next regular meeting of the asso­ciation or may be considered final as to the association. The bylaws may provide that one or more directors may be nominated by the Department of Agriculture and Consumer Services or by the other directors nominated by the members or their delegates. Such directors shall represent primarily the interest of the general public in such associations . Such directors shall not number more than one-third of the entire number of directors.

(2) An association may provide a fair remuneration for the time actually spent by its officers and directors in the service and for the service of the members of its executive committee. No director, during the term of his office, shall be a party to a contract for profit with the as­sociation differing in any way from the business relations accorded regular members or holders of common stock of the association or others , or differing from terms gen­erally current in that district.

(3) The bylaws may provide for an executive com­mittee to be elected by the board of directors from with­in or without the membership of the board and may allot to such committee all the functions and powers of the board of directors, subject to the general direction and control of the board .

(4) When a vacancy on the board of directors occurs other than by expiration of term, the remaining members of the board, by a majority vote, shall fill the vacancy, un­less the bylaws provide for the nomination of directors by districts. In such case the board of directors shall call a special meeting of the members or stockholders in the respective district to nominate a person qualified to fill the vacancy.

History.-s. 12, ch. 9300, 1923; CGL 6477: s. 12, ch. 14675, 1931 ; ss. 14, 35, ch. 69-106.

618.13 Officers; election.-The directors shall elect from their number a president and one or more vice presidents. They shall also elect a secretary, a treasurer, and such other officers as may be provided for in the by­laws, none of whom need be directors or members of the association . The office of secretary and treasurer may be combined into one office designated as secre­tary-treasurer, or both functions and titles may be unit­ed in one person. The treasurer may be a bank or any depository, and as such, shall not be considered as an officer, but as a function of the board of directors, and in such case the secretary shall perform the usual ac­counting duties of the treasurer excepting that the funds shall be deposited only as and where authorized by the board of directors.

Hlstory.-s. 13, ch. 9300, 1923: CGL 6478; s. 13, ch. 14675, 1931 .

618.14 Removal of officers and directors.-(1) Any member may bring charges against an offi­

cer or director by filing them in writing with the secretary of the association , together with a petition signed by 1 0 percent of the members, requesting the removal of the officer or director in question . The removal shall be voted upon at the next regular or special meeting of the associ­ation, and by a vote of a majority of the members, the association may remove the officer or director and fill the vacancy. The director or officer against whom such charges have been brought shall be informed in writing of the charges previous to the meeting and shall have an opportunity at the meeting to be heard in person or by counsel and to present witnesses, and the person bringing the charges against him shall have the same opportunity.

(2) In case the bylaws provide for election of direc­tors by districts with primary elections in each district then the petition for removal of a director must be signed by 20 percent of the members residing in the district from which he was elected. The board of directors must call a special meeting of the members residing in that district to consider the removal of the director. By a vote of the majority of the members of that district, the direc­tor in question shall be removed from office.

Hlstory.-s. 15, ch. 9300, 1923; CGL 6480; s. 15, ch. 14675, 1931 .

618.15 Capital stock and membership.-(1) When a member of an association organized

without capital stock has paid his membership fee in full he shall receive a certificate of membership. An associa­tion may issue its shares of stock having no par value from time to time for such consideration as may be fixed by the board of directors. No association shall issue stock until it has been fully paid for. Promissory notes may be accepted by the association as full or partial payment for such stock. The association shall hold the stock as security for the payment of the note; but such retention as security shall not affect the right of any stockholder to vote unless such notes are past due.

(2) No member shall be liable for the debts of the as­sociation to an amount exceeding the sum remaining un­paid on his membership fee or his subscription to capital stock, including any unpaid balance on any promissory notes given in payment thereof.

(3) No stockholder of an association organized un­der this chapter, except an association organized under

370

F.S. 1987 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS Ch.618

this chapter or an association as defined in this chapter, shall own more than one-third of the outstanding com­mon stock of the association; and an association in its bylaws may limit the amount of common stock which one member may own to an amount less than one-third of the outstanding common stock. The association shall limit its dividends on stock both common and preferred, to any amount not greater than 8 percent per annum on the par value thereof, or if such capital stock is without par value, then upon the actual cash value of the consid­eration received by the association therefor. The associ­ation by the vote of its directors, may establish and ac­cumulate reserves out of earnings, including a perma­nent surplus fund as an addition to capital. Net income in excess of additions to reserves and surpluses so es­tablished shall be distributed to the members of the as­sociation on the basis of patronage. Any distribution of reserves and surpluses at any time shall be made to members at the time such distribution is ordered on the basis of patronage.

(4) Any receipts or dividends from subsidiary corpo­rations or from stock or other securities owned by the association shall be included in the ordinary receipts of the association.

(5) No member in any association without capital stock shall be entitled to more than one vote; but the by­laws may provide that such members or the holders of common stock in an association with capital stock, may vote upon any or all questions on a patronage basis.

(6) Preferred stock may be sold to any person, mem­ber or nonmember, and may be redeemable or retirable by the association on such terms and conditions as may be provided for in the articles of incorporation, and print­ed on the stock certificates. The bylaws, except as oth­erwise provided for in this chapter, shall prohibit the transfer of the common stock of the association to per­sons not engaged in the production of agricultural prod­ucts and such restrictions shall be printed upon every certificate of stock subject thereto.

History.-s. 14, ch. 9300, 1923; CGL 6479; s. 14, ch. 14675, 1931.

618.16 Referendum upon certain motions.-Upon demand of one-third of the entire board of directors made immediately and so recorded at the same meeting at which the original motion was passed any matter that has been approved or passed by the board must be re­ferred to the entire membership or the stockholders for decision at the next special or regular meeting; provid­ed, however, that a special meeting may be called for the purpose.

History.-s. 16, ch. 9300, 1923; CGL 6481 ; s. 16, ch . 14675, 1931 .

618.17 Marketing contracts.-The association and its members may make and execute marketing con­tracts requiring the members to sell, for any period of time, all or any specified part of their agricultural prod­ucts or specified commodities exclusively to or through the association or any agencies designated by the asso­ciation. The contracts may provide that the association may sell or resell the products of its members with or without taking title thereto; and pay to its members the resale price, after deducting all necessary selling, over­head and other costs and expenses, including interest or dividends on stock, not exceeding 8 percent per an-

371

num, and reserves for retiring the stock, if any; and other proper reserves ; and any other proper deductions.

History.-s. 17, ch. 9300, 1923: CGL 6482(1); s. 17, ch. 14675, 1931 .

618.18 Remedies for breach of marketing contract. (1) The bylaws and the marketing contract may fix,

as liquidated damages, specific sums to be paid by the member or stockholder of the association upon the breach by him of any provisions of the marketing con­tract regarding the sale or delivery or withholding of products; and may further provide that the member will pay all costs , premiums for bonds, expenses and fees in case any action is brought upon the contract by the association; and any such provisions shall be valid and enforceable in the courts of this state.

(2) In the event of any such breach or threatened breach of such marketing contract by a member, the as­sociation shall be entitled to an injunction to prevent the further breach of the contract and to a decree of specific performance thereof. Pending the adjudication of such an action and upon filing a verified complaint showing the breach or threatened breach, and upon filing a suffi­cient bond, the association shall be entitled to a tempo­rary restraining order and preliminary injunction against the member.

History.-s. 17, ch. 9300, 1923; CGL 6482(1); s. 18, ch. 14675, 1931 ; CGL 1936 Supp. 6482(1); s. 7, ch . 22858, 1945.

618.19 Contracts and agreements with other like associations.-Any association may, upon resolution adopted by its board of directors, enter into all neces­sary and proper contracts and agreements and make all necessary and proper stipulations, agreements and contracts, and arrangements with any other cooperative corporation, association or associations, formed in this or in any other state, for the cooperative and more eco­nomical carrying on of its business or any part thereof. Any two or more associations may, by agreement be­tween them, unite in employing and using or may sepa­rately employ and use the same personnel , methods, means, and agencies for carrying on and conducting their respective businesses.

History.-s. 22, ch. 9300, 1923: CGL 6487; s. 22, ch. 14675, 1931.

618.20 Purchase of interest in like corporations.­(1) An association may organize, form, operate,

own , control , have an interest in, own stock of, or be a member of any other association or corporation, with or without capital stock, and engaged in planting, growing, producing, preserving, drying, processing , canning, packing, storing, warehousing, handling , shipping, utiliz­ing, manufacturing, or selling of agricultural products, or byproducts thereof; or in performing business or educa­tional services; or in the financing of any of the above enumerated activities.

(2) If such corporations are warehousing corpora­tions, they may issue legal warehouse receipts to the as­sociations against the commodities delivered by it, or to any other person and such legal warehouse receipts shall be considered as adequate collateral to the extent of the usual and current value of the commodity repre­sented thereby. In case such warehouse is licensed, or licensed and bonded under the laws of this or any other state or the United States, its warehouse receipt deliv-

Ch.618 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS F.S. 1987

ered to the association on commodities of the associa­tion or its members, or delivered by the association or its members, shall not be challenged or discriminated against because of ownership or control wholly or in part , by the association .

History.-s. 21 , ch . 9300, 1923; CGL 6486; s. 21 , ch. 14675, 1931 .

618.21 Corporations not in restraint of trade.-No association as defined in this chapter while engaged in any of the activities specified in s. 618.20 shall be deemed to be a conspiracy, or a combination in unlawful restraint of trade, or an illegal monopoly, or an attempt to lessen competition or to fi x prices arbitrarily; nor shall the marketing contracts and agreements between the association and its members or any agreements author­ized in this chapter, be considered illegal as such, or in unlawful restraint of trade, or part of a conspiracy or combination to accomplish an improper or illegal pur­pose.

History.-s. 24, ch . 9300, 1923; CGL 6489; s. 24, ch. 14675, 1931.

618.22 Adoption of provisions of this chapter by prior corporations.-Any corporation or association , or­ganized under previously existing statutes, may, by a majority vote of its stockholders or members, be brought under the provisions of this chapter by limiting its mem­bership and adopting the other restrictions as provided herein . It shall make out in duplicate a statement signed and sworn to by its directors to the effect that the corpo­ration or association has, by a majority vote of its stock­holders or members, decided to accept the benefits and be bound by the provisions of this chapter and has authorized all changes accordingly. Articles of incorpo­ration shall be filed as required in s. 618.04, except that they shall be signed by the members of the then board of directors . The filing fee shall be the same as for filing an amendment to articles of incorporation .

History.-s. 23, ch. 9300, 1923; CGL 6488; s. 23, ch. 14675, 1931 .

618.221 Conversion into a corporation for profit.­Any association incorporated under or that has adopted the provisions of this chapter, may, by a majority vote of its stockholders or members be brought under the provisions of chapter 607, as a corporation for profit by surrendering all right to carry on its business under this chapter, and the privileges and immunities incident thereto. It shall make out in duplicate a statement signed and sworn to by its directors to the effect that the asso­ciation has, by a majority vote of its stockholders or members, decided to surrender all rights , powers, and privileges as a nonprofit cooperative marketing associa­tion under this chapter and to do business under and be bound by the provisions of said chapter 607, as a corpo­ration for profit and has authorized all changes accord­ingly. Articles of incorporation shall be delivered to the Department of State for filing as required in and by s. 607.164, except that they shall be signed by the mem­bers of the then board of directors. The filing fees and taxes shall be as provided in chapter 607. Such articles of incorporation shall adequately protect and preserve the relative rights of the stockholders or members of the association so converting into a corporation for profit; provided that no rights or obligations due any stockhold­er or member of such association or any other person,

firm , or corporation which has not been waived or satis­fied shall be impaired by such conversion into a corpora­tion for profit as herein authorized.

Hlstory.-s. 2, ch. 29813, 1955; s. 8, ch. 79-9; s. 234, ch. 79- 400.

618.23 Quo warranto to test validity of corporation. -The right of an association claiming to be organized and incorporated and carrying on its business under this chapter to do and to continue its business, may be in­quired into by quo warranto at the suit of the Depart­ment of Legal Affairs , but not otherwise.

History.-s. 26, ch. 14675, 1931 ; CGL 1936 Supp. 6489(2); ss. 11 , 35, ch. 69-1 06.

618.24 Application of general corporation laws.­The provisions of the laws of this state with respect to corporations for profit and all powers and rights thereun­der shall apply to associations organized under this chapter, except where such provisions are in conflict with or inconsistent with the express provisions of this chapter.

History.-s. 26, ch. 9300, 1923; CGL 6491 ; s. 29, ch. 14675, 1931 .

618.25 Dissolution.-(1) Any association incorporated under or adopting

the provisions of this chapter may be dissolved and its affairs wound up voluntarily by a petition signed by two­thirds of the members or by the holders of two-thirds of the common stock, either in person or by their agent, which petition shall be presented to the circuit judge, who shall direct notice thereof to be published for such time as he may judge expedient. After the expiration of the time of such notice, the circuit judge may decree a dissolution and make all necessary orders and decrees for the winding up of its affairs, including the application of its assets toward the satisfaction of the claims of creditors so far as may be and the distribution of any moneys then remaining among its members in propor­tion to their respective property interests.

(2) Any such association shall continue to be a body corporate for a term of 2 years after the date of the de­cree or dissolution for the purpose of prosecuting and defending suits and settling its affairs, and the president and directors at the time of its dissolution , and the survi­vors of them, or such other person as may be appointed by the circuit judge, shall be trustees of such associa­tion for that purpose during said term with full power in its name to settle its affairs, collect all sums due it, sell and convey its property, pay its debt as far as may be, and distribute any moneys or property then remaining among those entitled thereto.

Hlstory.-s. 27, ch. 14675, 1931 ; CGL 1936 Supp. 6489(3).

618.26 Conditions under which foreign similar cor­poration may do business in this state.-Any coopera­tive association with or without capital stock as defined in this chapter heretofore or hereafter organized under the laws of another state shall be allowed to carry on any proper activities, operations and functions in this state upon the filing with the Department of State of a certified copy of its articles of incorporation and the payment of a filing fee of $10 in lieu of all franchise or license or cor­poration taxes as required of associations organized un­der this chapter, and all contracts which could be made by any association organized under this chapter, made

372

F.S. 1987 AGRICULTURAL COOPERATIVE MARKETING ASSOCIATIONS Ch.618

by or with such associations shall be legal and valid and enforceable in this state with all of the remedies set forth in this chapter.

Hiatory.-s. 25, ch. 14675, 1931 ; CGL 1936 Supp. 6489(1); ss. 10, 35, ch. 69-106.

618.27 Use of term "cooperative."-(1) No person doing business in this state, shall be

entitled to use the word "cooperative" as part of its cor­porate or other business name or title unless it has com­plied with the provisions of this chapter.

(2) Any person now organized and existing or doing business in this state, and embodying the word "coop­erative" as part of its corporate or other business name or title, and which is not organized in compliance with

the provisions of this chapter, shall eliminate the word "cooperative" from its said corporate or other business name or title.

Hlatory.-s. 20, ch. 9300, 1923; CGL 6485; s. 20, ch. 14675, 1931 ; s. 7, ch . 22858, 1945.

618.28 This chapter not to affect certain laws.­The provisions of this chapter shall not be construed to affect, limit, or in anywise interfere with the rights, pow­ers, or privileges of any corporation or association which exists or which may be hereafter organized under chap­ter 619 or chapter 617 and laws prior thereto.

Hiatory.-s. 29, ch. 9300, 1923; CGL 6494; s. 30, ch. 14675, 1931 ; s. 6, ch. 16879, 1935; s. 2, ch. 80-192.

373

Ch.619 NONPROFIT COOPERATIVE ASSOCIATIONS F.S. 1987

CHAPTER 619

NONPROFIT COOPERATIVE ASSOCIATIONS

619.01 619.02 619.03

619.04 619.05 619.06 619.07

619.08 619.09

Nonprofit cooperative associations; powers. Associations not in restraint of trade. Not to have capital stock; not for profit ; mem­

bership; membership not assignable; direc­tors may consent to assignment

Articles of incorporation . Amendment of articles of incorporation. Bylaws. Special powers ; marketing contracts ; voluntary

dissolution. May own stock in certain corporations. Quo warranto to test validity of incorporation.

619.01 Nonprofit cooperative associations; pow­ers.-Three or more persons engaged in the produc­tion , preserving, drying , packing, canning , bottling, ship­ping , or marketing of agricultural , viticultural , or horticul­tural products, or all or any of them, or in the manufac­ture or preparation of any confection , extracts , oils , juices, or byproducts, or any or all of them, or three or more persons engaged in the production and marketing of aquatic products and sponges, may form a nonprofit cooperative association under the provisions of this chapter to carry on said business; and such associa­tions shall have and may exercise powers authorized by this chapter, and powers, necessarily incidental thereto and all other powers granted to private corporations by the laws of this state, except such powers as are incon­sistent with those granted by this chapter .

History.-s. 1, ch. 5958, 1909; RGS 4510; s. 1, ch. 91 44, 1923; s. 1, ch. 10097, 1925; CGL 6509; s. 1, ch. 14544, 1929; s . 2, ch. 74-88.

619.02 Associations not in restraint of trade.-No association organized under this chapter shall be deemed to be a combination in restraint of trade or an illegal monopoly; or an attempt to lessen competition to fix prices arbitrarily, nor shall the marketing contracts , or any agreements authorized in this chapter be consid­ered illegal or in restraint of trade.

History.-s. 1, ch. 5958, 1909; RGS 451 0; s. 1, ch. 91 44, 1923; s. 1, ch. 10097, 1925; CGL 6509; s. 1, ch. 14544, 1929.

619.03 Not to have capital stock; not for profit; membership; membership not assignable; directors may consent to assignment-Such associations shall not have a capital stock, and its business shall not be carried on for profit Any person , or any number of per­sons, in addition to the original incorporators, may be­come members of such association, upon such terms and conditions as to membership and subject to such rules and regulations as to their, and each of their, con­tract and other rights and liabilities between it and the member, as the said association shall provide in its by­laws. The association shall issue a certificate of mem­bership to each member but the said membership, or the said certificate thereof, shall not be assigned by a member to any other person , nor shall the assigns there­of be entitled to membership in the association or to any property rights or interest therein. Nor shall a purchaser at execution sale, or any other person who may suc­ceed, by operation of law or otherwise, to the property

interests of a member, be entitled to membership or be­come a member of the association by virtue of such transfer. The board of directors may, however, by mo­tion duly adopted by it , consent to such assignment or transfer and to the acceptance of the assignee or trans­feree as a member of the association, but the associa­tion may, by its bylaws, provide for or against the trans­fer of membership and for or against the assignment of membership certificates, and also the terms and condi­tions upon which any such transfer or assignment shall be allowed .

Hlatory.-s. 2, ch. 5958, 1909; RGS 4511 ; CGL 651 0.

619.04 Articles of incorporation.-Each association formed under this chapter must prepare and file articles of incorporation in the same manner and under the same regulations as required under chapter 607 , and therein shall set forth :

(1) The name of the association . (2) The purpose for which it is formed . (3) The place where its principal business will be

transacted . (4) The term for which it is to exist, not exceeding 50

years . (5) The number of directors thereof, which must not

be less than three and which may be any number in ex­cess thereof, and the names and residences of those se­lected for the first year and until their successors shall have been elected and shall have accepted office.

(6) Whether the voting power and the property rights and interest of each member shall be equal, or un­equal , and if unequal these articles shall set forth a gen­eral rule applicable to all members by which the voting power and the property rights and interests, respective­ly, of each member may and shall be determined and fixed , but the association shall have power to admit new members, who shall be entitled to vote and to share in the property of the association with the old members, in accordance with such general rule . This provision of the articles of incorporation shall not be altered , amended or repealed except by the unanimous written consent or the vote of all the members.

(7) Said articles must be subscribed by the original members and acknowledged by one of them before an officer authorized by the law of this state to take and cer­tify acknowledgments of deeds of conveyance, and shall be filed in accordance with the provisions of law, and when so filed the said articles of incorporation or certified copies thereof shall be received in all the courts of this state and other places as prima facie evidence of the facts contained therein.

Hlatory.-s. 3, ch. 5958, 1909; RGS 4512; CGL 6511 ; s. 9, ch. 79-9.

619.05 Amendment of articles of incorporation.­(1) Any nonprofit cooperative association heretofore

or hereafter organized may amend its charter by a two­thirds vote of all its members at any regular meeting, or at a special meeting called for that purpose.

(2) If the proposed alteration or amendment shall be so adopted, the corporation shall prepare a certificate,

374

F.S. 1987 NONPROFIT COOPERATIVE ASSOCIATIONS Ch. 619

under its common seal, of the proposed alteration or amendment as adopted by said corporation, which cer­tificate accompanied by said proposed amendment or alteration, shall be signed by the president or vice presi­dent of said corporation and attested by its secretary, and file the same with the Department of State; which certificate accompanied by said proposed amendment or alteration, shall be produced to the Governor, who shall examine the same, and if it is found to be in proper form , and that the proposed alteration or amendment has been properly adopted, is lawful and not injurious to the community, and is in accord with the purpose of the charter, the Governor shall approve the same, and there­upon letters patent shall issue, reciting the alteration or amendment; and the said letters patent shall then be recorded by the Department of State, and from the date of the record thereof in the Department of State, said al­teration or amendment shall be treated and considered as a part of the charter of said corporation.

History.-s. 1, ch. 17132, 1935; CGL 1936 Supp. 6515(1); s. 17, ch. 61-530; ss. 10, 35, ch. 69-106.

619.06 Bylaws.-Each association incorporated un­der this chapter must, within 30 days after its incorpora­tion, adopt a code of bylaws for its government and management not inconsistent with the provisions of this law. A majority vote of the members or the written as­sent of members representing a majority of the votes, is necessary to adopt such bylaws. The provisions of the general laws of this state not inconsistent with the provi­sions of this chapter shall apply to the bylaws of the cor­porations provided for in this chapter. Each association may also, by its bylaws adopted as aforesaid, provide for the following matters:

(1) The manner of removal of any one or more of its directors and for filling any and all vacancies in the board of directors.

(2) The number of directors and the number of mem­bers or votes thereof constituting a quorum.

(3) The conditions upon which, and the time when, membership of any member in the association shall cease; the mode, manner and effect of expulsion of a member, subject to the right of the expelled member to have the board of directors (equitably) appraise his property interests in the association and to affix the amount thereof in money, and to have the money paid to him within 60 days after such expulsion.

(4) The amount of membership fee, if any, and the amount which each member shall be required to pay an­nually, or from time to time, if at all, to carry on the busi­ness of the association, and also the compensation, if any, to be paid by each member for any services ren­dered by the association to him, and the time of pay­ment and the manner of collecting the same, and for for­feiture of the interest of the member in the association for nonpayment of the same.

(5) The number and qualification of members of the association and the conditions precedent to member­ship, and the method, time and manner of permitting members to withdraw, and providing for the assignment and transfer of the interest of the member, and the man­ner of determining the value of such interest, and provid­ing for the purchase of such interest by the association

upon the death, withdrawal or expulsion of a member or upon the forfeiture of his membership, at the option of the association.

(6) Permitting members to vote by their proxies and determining the conditions, manner, form and effect thereof.

History.-s. 4, ch. 5958, 1909; RGS 4513; CGL 6512.

619.07 Special powers; marketing contracts; vol­untary dissolution.-Each association incorporated un­der this chapter shall have the powers granted by the provisions of this law and other laws of Florida relating to private corporations, and shall also .have the following powers :

(1) To appoint such agents and officers as its busi­ness may require , and such appointed agents may be either persons or corporations; to admit persons to membership in the association, and to expel any mem­ber pursuant to the provisions of its bylaws; to forfeit the membership of any member for violation of any agree­ment between him and the association, or for his viola­tion of its bylaws.

(2) To purchase or otherwise acquire, hold, own, sell, and otherwise dispose of any and every kind of real and personal property necessary to carry on its busi­ness, and to acquire by purchase or otherwise the inter­est of any member in the property of the association.

(3) Upon the written assent or by a vote of members representing two-thirds of the total votes of all members to cooperate with any other cooperative corporation or corporations for the cooperative and more economical carrying on of their respective business, by consolida­tion; upon resolution adopted by board of directors, to enter into all necessary and proper contracts and agree­ments, and to make all necessary and proper stipula­tions and arrangements with any other cooperative cor­poration or corporations, for the cooperative and more economical carrying on of its business, or any part there­of; or any two or more cooperative corporations orga­nized under this title, upon resolutions adopted by their respective boards of directors, may for the purpose of more economically carrying on their respective busi­ness, by agreement between them, unite in employing and using, or several associations may separately em­ploy and use, the same methods, means and agencies for carrying on and conducting their respective busi­nesses.

(4) To organize, form, operate, own, control, have in­terest in, own stock of, or be a member of any other cor­poration, with or without capital stock, and engaged in preserving, drying, processing, canning, picking, haul­ing, packing, storing, handling, shipping , utilizing, manu­facturing, marketing, or selling any of the agricultural or horticultural products handled by the association, or the byproducts thereof.

(5) To make and execute marketing contracts re­quiring the members to sell, for any period of time, not over 10 years, all or any specified part of their agricultur­al or horticultural products exclusively to or through the association or any facilities to be created by the associa­tion. The contracts may provide that the association may sell or resell the products of its members with or without taking title thereto, and pay over to its members

375

Ch.619 NONPROFIT COOPERATIVE ASSOCIATIONS F.S. 1987

the sale or resale price, after deducting all necessary selling , overhead and other costs and expenses, includ­ing interest on bonds, not exceeding 8 percent per an­num and reserves for retiring the bonds, if any, and other proper reserves.

(6) Either the bylaws or the marketing contracts, or both the said bylaws and marketing contracts may fix, as liquidated damages, specific sums to be paid by the member to the association upon the breach by him of any provision of the marketing contract regarding the sale or delivery or withholding of products; and may fur­ther provide that the member will pay all costs, premi­ums for bonds, expenses and fees in case any action is brought upon the contract by the association and any such provisions shall be valid and enforceable in the courts of this state.

(7) In the event of any breach or threatened breach of a marketing contract by a member, the association shall be entitled to an injunction to prevent the further breach of the contract, and to a decree of specific per­formance thereof. Pending the adjudication of such an action, and upon filing a verified complaint showing the breach or threatened breach, and upon filing a sufficient bond, the association shall be entitled to a temporary re­straining order and a preliminary injunction against the member.

(8) Any association formed or consolidated under this chapter may be dissolved and its affairs wound up voluntarily by the written request of members represent­ing two-thirds of the total votes, in the manner and with the effect now provided by law, except that the moneys remaining after liquidation shall be divided among the members in proportion to their property interest therein .

History.-s. 5, ch. 5958, 1909; RGS 4514; s. 2, ch. 10097, 1925; CGL 6513.

619.08 May own stock in certain corporations.­Any agricultural or horticultural nonprofit, cooperative association, heretofore, or hereafter, organized under the laws of the state, may own or hold stock in any cor­poration organized under the laws of the state, if such corporation is organized, or conducts, or operates, its business, solely for the benefit or advancement of the interests of persons engaged in agricultural or horticul­tural pursuits in this state.

History.-s. 1, ch. 7383, 1917; RGS 4515; CGL 6514.

619.09 Quo warranto to test validity of incorpora­tion.-The right of an association claiming to be orga­nized and incorporated and carrying on its business un­der this chapter to do and to continue its business, may be inquired into by quo warranto at the suit of the De­partment of Legal Affairs , but not otherwise.

Hlstory.-s. 8, ch. 5958, 1909; RGS 4516; CGL 6515; ss. 11 , 35, ch. 69-106.

376

F.S. 1987 PARTNERSHIP LAWS Ch.620

CHAPTER 620

PARTNERSHIP LAWS

PART I UNIFORM LIMITED PARTNERSHIPS (ss. 620.1 01-620.186)

PART II UNIFORM PARTNERSHIP ACT (ss. 620.56-620.77)

PART I

UNIFORM LIMITED PARTNERSHIPS

620.101 Short title . 620.102 Definitions. 620.103 Name of limited partnership. 620.104 Reservation of name. 620.105 Record keeping office; agent for service of

process. 620.106 Records to be kept. 620.107 Nature of business that may be carried on . 620.108 Formation ; certificate of limited partnership. 620.109 Amendment to , or restated, certificate of limit-

ed partnership. 620.112 Supplemental affidavit of capital contribu­

tions. 620.113 Cancellation of certificate of limited partner­

ship. 620.114 Execution of certificate. 620.115 Execution of certificate pursuant to court or-

der. 620.116 Filing with Department of State. 620.117 Liability for false statement in certificate. 620.118 Filing; scope of notice. 620.119 Delivery of certificates to limited partners. 620.122 Business transactions of partner with partner-

ship. 620.123 Admission of additional general partners . 620.124 Events of withdrawal of general partner. 620.125 General rights, powers, restrictions , and liabil-

ities of general partner. 620.126 Contributions by general partner. 620.127 Voting rights of general partners. 620.128 Admission of limited partners. 620.129 Liability of limited partner to third parties. 620.132 Liability of person erroneously believing him-

self to be a limited partner. 620.133 Voting rights of limited partners. 620.134 Limited partner's right to inspect records and

demand information. 620.135 Form of contribution. 620.136 Liability for contribution . 620.137 Sharing of profits and losses. 620.138 Sharing of distributions. 620.139 Interim distributions. 620.142 Withdrawal of general partner. 620.143 Withdrawal of limited partner. 620.144 Distribution upon withdrawal. 620.145 Distribution in kind. 620.146 Right to distribution. 620.147 Limitation on distribution. 620.148 Liability upon return of contribution .

620.149 Nature of partner's interest in the limited part-nership.

620.152 Assignment of partnership interest. 620.153 Rights of judgment creditor of. partner. 620.154 Right of assignee to become lim1ted partner. 620.155 Power of estate of deceased or incompetent

partner. 620.156 Property of limited partnership. 620.157 Nonjudicial dissolution. 620.158 Judicial dissolution . 620.159 Winding up affairs of limited partnership. 620.162 Distribution of assets. 620.163 Right of limited partner to bring derivative ac-

tion . 620.164 Derivative action ; proper plaintiff. 620.165 Derivative action ; pleading. 620.166 Derivative action ; expenses. 620.167 Laws governing foreign limited partnership: 620.168 Name under which foreign limited partnership

may register. . 620.169 Registration of foreign limited partnership. 620.172 Issuance of certificate of reg1strat1on to for­

eign limited partnership. 620.173 Amendments to registration application. 620.17 4 Cancellation of registration of foreign limited

partnership. . 620.175 Action to restrain foreign limited partnership

from transacting business . 620.176 Supplemental affidavit of capital contribu­

tions . 620.177 Annual report of domestic or foreign limited

partnership. . 620.178 Revocation of authority to transact bus1ness;

reinstatement. 620.179 Transaction of business without registration

or after revocation of authority; effect. 620.182 Fees of the Department of State. 620.183 Disposition of moneys collected. 620.184 Construction and application of act. 620.185 Effect of repeal of prior statutes. 620.186 Applicability of Uniform Partnership Act. 620.192 Registered agent; duties.

620.101 Short title.-Sections 620.101-620.186 may be cited as the "Florida Revised Uniform Limited Partnership Act (1986) ."

History.- s. 1, ch. 86-263.

620.102 Definitions.-As used in this act , unless the context otherwise requires , the term :

(1) "Certificate of limited partnership" means the cer­tificate referred to in s. 620.108, or the cert1f1cate as amended or restated .

377

Ch.620 PARTNERSHIP LAWS F.S. 1987

(2) "Contribution" means any cash , property, or ser­vices rendered, or a promissory note or other obligation to contribute cash or property or to perform services, which a partner contributes to a limited partnership in his capacity as a partner.

(3) "Event of withdrawal of a general partner" means an event that causes a person to cease to be a general partner as provided in s. 620.124.

(4) "Foreign limited partnership" means a partner­ship formed by two or more persons under the laws of any state other than this state and having as partners one or more general partners and one or more limited partners.

(5) "General partner" means a person who has been admitted to a limited partnership as a general partner 1n accordance with the partnership agreement and is named in the certificate of limited partnership as a gen­eral partner.

(6) "Limited partner" means a person who has been admitted to a limited partnership as a limited partner in accordance with the partnership agreement.

(7) "Limited partnership" or "domestic limited part­nership" means a partnership formed by two or more persons under the laws of this state and having one or more general partners and one or more limited partners.

(8) "Partner" means a limited or general partner. (9) "Partnership agreement" means any valid agree­

ment, written or oral, of the partners as to the affa1rs of a limited partnership and the conduct of its business.

(10) "Partnership interest" means a partner's share of the profits and losses of a limited partnership and the right to receive distributions of partnership assets.

(11) "Person" means a natural person, partnership, limited partnership (domestic or foreign), trust, estate, association, or corporation.

(12) "State" means a state, territory, or possession of the United States; the District of Columbia; or the Com­monwealth of Puerto Rico.

History.-s. 2, ch. 86-263.

620.103 Name of limited partnership.-The name of each limited partnership as set forth in its certificate of limited partnership:

(1) Must contain the word "Limited" or its abbrevia­tion , "Ltd.";

(2) May not contain the name of a limited partner un­less:

(a) That name is also the name of a general partner or the corporate name of a corporate general partner; or

(b) The business of the limited partnership had been carried on under that name before the admission of that limited partner; and

(3) May not be the same as, and must be distin­guishable from , the name of any corporation or limite? partnership organized under the laws of th1s state or li­censed or registered as a foreign corporation or limited partnership in this state.

Hiatory.-s. 3, ch. 86-263.

620.104 Reservation of name.-(1) The exclusive right to the use of a name may be

reserved by: (a) Any person intending to organize a limited part­

nership under this act and to adopt that name;

(b) Any domestic limited partnership or any foreign limited partnership registered in this state which, in ei­ther case, intends to adopt that name;

(c) Any foreign limited partnership intending to reg­ister in this state and adopt that name; or

(d) Any person intending to organize a foreign limit­ed partnership and intending to have it registered in this state and adopt that name.

(2) The reservation must be made by filing with the Department of State an application, executed by the ap­plicant, to reserve a specified name. If the department finds that the name is available for use by a domestic or foreign limited partnership, it shall reserve the name for the exclusive use of the applicant for a period of 120 days. Once having so reserved a name, the same appli­cant may not again reserve the same name until more than 60 days after the expiration of the last 120-day peri­od for which that applicant reserved that name. The right to the exclusive use of a reserved name may be transferred to any other person by filing with the depart­ment a notice of the transfer, executed by the applicant for whom the name was reserved and specifying the name and address of the transferee.

History.-s. 4, ch. 86-263.

620.105 Recordkeeping office; agent for service of process.-Each limited partnership shall continuously maintain in this state:

(1) An office, which may but need not be a place of its business in this state, at which must be kept the rec­ords required by s. 620.106 to be maintained; and

(2) An agent for service of process on the limited partnership, which agent must be an individual resident of this state, a domestic corporation , or a foreign corpo­ration authorized to do business in this state.

Hlatory.-s. 5, ch. 86-263.

620.106 Records to be kept.-(1) Each limited partnership shall keep at the office

referred to in s. 620.1 05(1) the following records: (a) A current list of the full names and last-known

business addresses of all partners, separately identify­ing in alphabetical order the general partners and the limited partners;

(b) A copy of the certificate of limited partnership and all certificates of amendment thereto, together with executed copies of any powers of attorney pursuant to which any certificate was executed;

(c) Copies of the limited partnership's federal, state, and local income tax returns and reports, if any, for the three most recent years;

(d) Copies of any then-effective written partnership agreements and of any financial statements of the limit­ed partnership for the three most recent years; and

(e) Unless contained in a written partnership agree­ment, a writing setting out:

1. The amount of cash and a description and state­ment of the agreed value of the other property or ser­vices contributed by each partner and which each part­ner has agreed to contribute;

2. The times at which or events on the happening of which any additional contributions agreed to be made by each partner are to be made;

378

F.S. 1987 PARTNERSHIP LAWS Ch.620

3. Any right of a partner to receive distributions, or of a general partner to make distributions to a partner, that include a return of all or any part of the partner's contribution ; and

4. Any events upon the happening of which the lim­ited partnership is to be dissolved and its affairs wound up.

(2) Records kept under this section are subject to in­spection and copying during ordinary business hours at the reasonable request, and at the expense, of any part­ner.

Hlstory.-s. 6, ch . 86-263.

620.107 Nature of business that may be carried on. -A limited partnership may carry on any business that a partnership without limited partners may carry on .

Hlstory.-s. 7, ch. 86-263.

620.108 Formation; certificate of limited partner­ship.-

(1) In order to form a limited partnership, a certificate of limited partnership must be executed and filed with the Department of State. The certificate must set forth:

(a) The name of the limited partnership; (b) The address of the office and the name and ad­

dress of the agent for service of process required to be maintained by s. 620.105;

(c) The name and the business address of each general partner;

(d) A mailing address for the limited partnership; (e) The latest date upon which the limited partner­

ship is to dissolve; and (f) Any other matters the general partners deter­

mine to include therein .

An affidavit declaring the amount of the capital contribu­tions of the limited partners and the amount anticipated to be contributed by the limited partners must accompa­ny the certificate of limited partnership.

(2) A limited partnership is formed at the time of the filing of the certificate of limited partnership with the de­partment or at any later time specified in the certificate of limited partnership if, in either case, there has been substantial compliance with the requirements of this section.

History.-s. 8, ch . 86-263.

620.109 Amendment to, or restated, certificate of limited partnership.-

(1) A certificate of limited partnership is amended by filing a certificate of amendment thereto with the Depart­ment of State. The certificate of amendment must set forth:

(a) The name of the limited partnership; (b) The date of filing the certificate of limited partner­

ship; and (c) The amendment to the certificate of limited part­

nership. (2)(a) Within 30 days after the happening of any of

the following events, an amendment to a certificate of limited partnership, indicating the occurrence of the event or events, must be filed:

1. The admission of a new general partner. 2. The withdrawal of a general partner.

3. The continuation of the business under s. 620.157 after an event of withdrawal of a general part­ner.

4. A change in name of the limited partnership. 5. A change in the address of the office or the name

or address of the agent for service of process required to be maintained by s. 620.105.

(b) A general partner who becomes aware that any statement in a certificate of limited partnership was false when made or that any arrangements or other facts de­scribed in the certificate have changed, making the cer­tificate inaccurate in any respect , shall promptly amend the certificate.

(c) A certificate of limited partnership may be amended at any time for any other proper purpose the general partners determine.

(3) If an amendment to a certificate of limited part­nership is filed in compliance with subsection (2) , no per­son is subject to liability because the amendment was not filed earlier.

(4) Unless otherwise provided in this act or in the certificate of amendment, a certificate of amendment shall be effective at the time of its filing with the depart­ment.

(5) A limited partnership may, whenever desired, in­tegrate into a single instrument all of the provisions of its certificate of limited partnership which are then in ef­fect and operative as a result of there having theretofore been filed with the department one or more certificates or other instruments pursuant to any of the subsections referred to in this section, and it may at the same time further amend its certificate of limited partnership by adopting a restated certificate of limited partnership.

(6) If the restated certificate of limited partnership merely restates and integrates but does not further amend the initial certificate of limited partnership as theretofore amended or supplemented by any instru­ment that was executed and filed pursuant to any of the subsections in this section , it shall be specifically desig­nated in its heading as a "Restated Certificate of Limited Partnership, " together with such other words as the part­nership may deem appropriate, and shall be executed by a general partner and filed as provided by this act with the department. If the restated certificate restates and integrates and also further amends in any respect this certificate of limited partnership, as theretofore amended or supplemented , it shall be specifically desig­nated in its heading as an "Amended and Restated Cer­tificate of Limited Partnership ," together with such other words as the partnership may deem appropriate, and shall be executed by at least one general partner and by each other general partner designated in the restat­ed certificate of limited partnership as a new general partner and filed as provided by this act with the depart­ment.

(7) A restated certificate of limited partnership shall state, either in its heading or in an introductory para­graph, the limited partnership's present name, and, if it has been changed , the name under which it was origi­nally filed; the date of filing of its original certificate of limited partnership with the department and the future effective date or time, which shall be a date or time cer­tain , of the restated certificate if it is not to be effective

379

Ch.620 PARTNERSHIP LAWS F.S. 1987

upon the filing of the restated certificate. A restated cer­tificate shall also state that it was duly executed and is being filed in accordance with this section. If the restat­ed certificate only restates and integrates and does not further amend the limited partnership's certificate of lim­ited partnership as theretofore amended or supple­mented and there is no discrepancy between those pro­visions and the restated certificate, it shall state that fact as well.

(8) Upon the filing of the restated certificate of limit­ed partnership with the department, or upon the future effective date or time of a restated certificate of limited partnership as provided for therein, the initial certificate of limited partnership, as theretofore amended or sup­plemented, shall be superseded; thenceforth, the restat­ed certificate of limited partnership, including any fur­ther amendment or changes made thereby, shall be the certificate of limited partnership of the limited partner­ship, but the original effective date of formation shall re­main unchanged.

(9) Any amendment or change effected in connec­tion with the restatement and integration of the certifi­cate of limited partnership shall be subject to any other provisions of this act , not inconsistent with this section, which would apply if a separate certificate of amend­ment were filed to effect such amendment or change.

Hlstory.-s. 9, ch. 86-263.

620.112 Supplemental affidavit of capital contribu­tions.-A supplemental affidavit declaring the amount of the capital contributions of the limited partners must be filed with the Department of State within 30 days of any time when the actual contributions of the limited partners exceed the anticipated amount of capital con­tributions filed pursuant to s. 620.108.

Hlstory.-s. 10, ch. 86-263.

620.113 Cancellation of certificate of limited part­nership.-A certificate of limited partnership must be canceled upon the dissolution and the completion of winding up of the partnership or at any other time there are no limited partners. A certificate of cancellation must be filed with the Department of State and set forth:

(1) The name of the limited partnership; (2) The date of filing of the certificate of limited part­

nership; (3) The reason for filing the certificate of cancella­

tion ; (4) The future effective date, which must be a date

certain , of cancellation if cancellation is not to be effec­tive upon the filing of the certificate of cancellation; and

(5) Any other information the general partners filing the certificate of cancellation determine to include there· in.

Hlstory.-s. 11 , ch. 86-263.

620.114 Execution of certificate.-(1) A certificate required by s. 620.108, s. 620.109,

s. 620.112, or s. 620.113 to be filed with the Department of State must be executed in the following manner:

(a) If it is an original certificate of limited partnership, an affidavit, or supplemental affidavit, it must be signed by all general partners;

(b) If it is a certificate of amendment, it must be signed by at least one general partner and by each other general partner designated in the certificate as a new general partner; and

(c) If it is a certificate of cancellation, it must be signed by all general partners.

(2) Any person may sign a certificate by an attorney in fact , but a power of attorney to sign a certificate relat­ing to the admission of a general partner must specifical­ly describe the admission.

(3) The execution of a certificate by a general part­ner constitutes an affirmation under the penalties of per­jury that the facts stated therein are true.

Hlstory.-s. 12, ch. 86-263.

620.115 Execution of certificate .pursuant to court order.-lf a person required by s. 620.114 to execute a certificate fails or refuses to do so, any other person who is adversely affected by the failure or refusal may peti­tion the circuit court to direct the execution of the certifi­cate. If the court finds that it is proper for the certificate to be executed and that any person so designated has failed or refused to execute the certificate, the court shall order the Department of State to record an appro­priate certificate.

Hlstory.-s. 13, ch. 86-263.

620.116 Filing with Department of State.-(1) Two signed copies of the certificate of limited

partnership, any certificate of amendment or cancella­tion or any court order of amendment or cancellation, and any restated certificate must be delivered to the De­partment of State. A person who executes a certificate as an agent or fiduciary need not exhibit evidence of his authority as a prerequisite to filing .

(2) Unless the department finds that a certificate does not conform to law, upon receipt of all filing fees required by law, the department shall:

(a) Endorse on each duplicate original copy the word "Filed" and the day, month , and year of the filing thereof;

(b) File one duplicate original copy in its office; and (c) Return the other duplicate original copy to the

person who filed it or his representative. (3) Upon the filing of a certificate of amendment or

court order of amendment with the department, the cer­tificate of limited partnership is amended as set forth in the certificate of amendment or court-ordered certifi­cate of amendment; and, upon the effective date of a certificate of cancellation or a court order of cancella­tion, the certificate of limited partnership is canceled.

Hlstory.-s. 14, ch. 86-263.

620.117 Liability for false statement in certificate. -If a certificate of limited partnership or certificate of amendment or cancellation contains a false statement, a person who suffers loss by reasonable reliance on that statement may recover damages for the loss from:

( 1) Any person who executed the certificate or caused another to execute it on his behalf and knew, and any general partner who knew or should have known, the statement to be false at the time the certifi­cate was executed; and

380

F.S. 1987 PARTNERSHIP LAWS Ch.620

(2) Any general partner who thereafter knows or should have known that any arrangement or other fact described in the certificate has changed, making the statement inaccurate in any material respect, within a sufficient time before the statement was relied upon rea­sonably to have enabled that general partner to cancel or amend the certificate or to file a petition for its cancel­lation or amendment under s. 620.115.

Hlstory.-s. 15, ch. 86-263.

620.118 Filing; scope of notice.-The fact that a certificate of limited partnership is on file with the De­partment of State is notice that the partnership is a limit­ed partnership and the persons designated therein as general partners are general partners, but is not notice of any other fact.

History.-s. 16, ch. 86-263.

620.119 Delivery of certificates to limited partners. -Upon the return by the Department of State pursuant to s. 620.116 of a certificate marked "Filed," the general partners shall promptly deliver or mail a copy of the cer­tificate of limited partnership and each certificate of amendment or cancellation to each limited partner if the partnership agreement so requires.

Hlstory.-s. 17, ch. 86-263.

620.122 Business transactions of partner with part­nership.-Except as provided in the partnership agree­ment, a partner may lend money to, and transact other business with, the limited partnership and, subject to other applicable law, has the same rights and obliga­tions with respect thereto as a person who is not a part­ner.

Hlstory.-s. 18, ch. 86-263.

620.123 Admission of additional general partners. -After the filing of a limited partnership's original certifi­cate of limited partnership, additional general partners may be admitted as provided in writing in the partner­ship agreement or, if the partnership agreement does not provide in writing for the admission of additional gen­eral partners, with the written consent of all partners.

Hlstory.-s. 19, ch. 86-263.

620.124 Events of withdrawal of general partner.­Except as approved by the specific written consent of all partners at the time, a person ceases to be a general partner of a limited partnership upon the happening of any of the following events:

(1) When the general partner withdraws from the limited partnership as provided in s. 620.142.

(2) When the general partner ceases to be a mem­ber of the limited partnership as provided in s. 620.152.

(3) When the general partner is removed as a gener­al partner in accordance with the partnership agree­ment.

(4) Unless otherwise provided in writing in the part-nership agreement, when the general partner:

(a) Makes an assignment for the benefit of creditors; (b) Files a voluntary petition in bankruptcy; (c) Is adjudged a bankrupt or insolvent or has en­

tered against him an order for any relief in any bankrupt­cy or insolvency proceeding;

381

(d) Files a petition or answer seeking for himself any reorganization, arrangement, composition, readjust­ment, liquidation, dissolution, or similar relief under any statute, law, or regulation;

(e) Files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against him in any proceeding of this nature; or

(f) Seeks, consents to, or acquiesces in the appoint­ment of a trustee, receiver, or liquidator of the general partner or of all or any substantial part of his properties.

(5) Unless otherwise provided in writing in the part-nership agreement:

(a) When , 120 days after the commencement of any proceeding against the general partner seeking reorga­nization, arrangement, composition, readjustment, liqui­dation, dissolution, or similar relief under any statute, law, or regulation, the proceeding has not been dis­missed;

(b) When, 90 days after the appointment without the general partner's consent or acquiescence of a trustee, receiver, or liquidator of the general partner or of all or any substantial part of the general partner's properties, the appointment has not been vacated or stayed; or

(c) When , 90 days after the expiration of any such stay, the appointment has not been vacated.

(6) In the case of a general partner who is a natural person, his death or the entry of an order by a court of competent jurisdiction adjudicating him incompetent to manage his person or his property.

(7) In the case of a general partner who is acting as a general partner by virtue of being a trustee of a trust, upon the termination of the trust, but not merely the sub­stitution of a new trustee.

(8) In the case of a general partner that is a separate partnership, upon the dissolution and the commence­ment of winding up of the separate partnership.

(9) In the case of a general partner that is a corpora­tion, upon the filing of a certificate of dissolution, or its equivalent, for the corporation or the revocation of its charter.

(1 0) In the case of a general partner that is an estate, upon the distribution by the fiduciary of the entire inter­est of the estate in the partnership.

Hlstory.-s. 20, ch. 86-263.

620.125 General rights, powers, restrictions, and li­abilities of general partner.-

(1) Except as provided in this act or in the partner­ship agreement, a general partner of a limited partner­ship has the rights and powers and is subject to the re­strictions of a partner in a partnership without limited partners.

(2) Except as provided in this act, a general partner of a limited partnership has the liabilities of a partner in a partnership without limited partners to persons other than the partnership and the other partners. Except as provided in this act or in the partnership agreement, a general partner of a limited partnership has the liabilities of a partner in a partnership without limited partners to the partnership and to the other partners.

Hlstory.-s. 21 , ch. 86-263.

620.126 Contributions by general partner.-A gen­eral partner of a limited partnership may make contribu-

Ch.620 PARTNERSHIP LAWS F.S. 1987

tions to the limited partnership and share in the profits and losses of, and in distributions from, the limited part­nership as a general partner. A general partner also may make contributions to and share in profits, losses, and distributions as a limited partner. A person who is both a general partner and a limited partner has the rights and powers, and is subject to the restrictions and liabili­ties, of a general partner and, except as provided in the partnership agreement, also has the powers, and is sub­ject to the restrictions, of a limited partner to the extent of his participation in the partnership as a limited part­ner.

History.-s. 22, ch. 86-263.

620.127 Voting rights of general partners.-(1) A partnership agreement may provide for class­

es or groups of general partners having such relative rights, powers, and duties as the partnership agreement may provide, and may, in the manner provided in the partnership agreement, make provision for the future creation of additional classes or groups of general part­ners having such relative rights, powers, and duties as may from time to time be established, including rights , powers, and duties senior to existing classes and groups of general partners.

(2) The partnership agreement may grant to all or certain identified general partners or a specified class or group of the general partners the right to vote on a per capita or any other basis, separately or with all or any class or group of the limited partners or the general part­ners, on any matter.

(3) A partnership agreement which grants a right to vote may set forth provisions relating to notice of the time, place, or purpose of any meeting at which any mat­ter is to be voted on by any general partner, waiver of any such notice, action by consent without a meeting, the establishment of a record date, quorum require­ments, voting in person or by proxy, or any other matter with respect to the exercise of any such right to vote.

History.-s. 23, ch. 86--263.

620.128 Admission of limited partners.-(1) A person becomes a limited partner on the later

of: (a) The date the original certificate of limited partner­

ship is filed; or (b) The date stated in the records of the limited part­

nership as the date that person will become a limited partner.

(2) After the filing of a limited partnership's original certificate of limited partnership, a person may be admit­ted as an additional limited partner:

(a) In the case of a person acquiring a partnership interest directly from the limited partnership, upon the compliance with the partnership agreement or, if the partnership agreement does not so provide, upon the written consent of all partners; and

(b) In the case of an assignee of a partnership inter­est of a partner who has the power, as provided in s. 620.154, to grant the assignee the right to become a lim­ited partner, upon the exercise of that power and com­pliance with any conditions limiting the grant or exercise of the power.

Hlstory.-s. 24, ch. 86-263.

620.129 Liability of limited partner to third parties. (1) Except as provided in subsection (4), a limited

partner is not liable for the obligations of a limited part­nership unless he is also a general partner or, in addition to the exercise of his rights and powers as a limited part­ner, he participates in the control of the business. How­ever, if the limited partner participates in the control of the business, he is liable only to persons who transact business with the limited partnership reasonably believ­ing, based upon the limited partner's conduct, that the limited partner is a general partner.

(2) A limited partner does not participate in the con­trol of the business within the meaning of subsection (1) solely by doing one or more of the following things:

(a) Being a contractor for or an agent or employee of the limited partnership or of a general partner or being an officer, director, or shareholder of a general partner that is a corporation .

(b) Consulting with or advising a general partner with respect to any matter, including the business of the limited partnership.

(c) Acting as surety, guarantor, or endorser for the limited partnership; guaranteeing or assuming one or more specific obligations of the limited partnership; or providing collateral for the limited partnership.

(d) Taking any action required or permitted by law to bring or pursue a derivative action in the right of the limited partnership.

(e) Requesting, attending, or participating in a meet­ing of partners.

(f) Serving on a committee of the limited partnership or the limited partners.

(g) Proposing , approving, or disapproving, by voting or otherwise, one or more of the following matters:

1. The dissolution and the winding up of the limited partnership.

2. The sale, exchange, lease, mortgage, assign­ment, pledge, or other transfer of, or granting of a securi­ty interest in, any or all or substantially all of the assets of the limited partnership.

3. The incurrence, renewal, refinancing, payment, or other discharge of indebtedness by the limited part­nership other than in the ordinary course of its business.

4. A change in the nature of the business. 5. The admission, removal, or retention of a general

partner. 6. The admission, removal, or retention of a limited

partner. 7. A transaction involving an actual or potential con-

flict of interest between a general partner and the limited partnership or the limited partners.

8. An amendment to the partnership agreement or certificate of limited partnership.

9. A matter related to the limited partnership not otherwise enumerated in this subsection which the part­nership agreement states in writing is subject to the ap­proval or disapproval of limited partners.

(h) Winding up the limited partnership pursuant to s. 620.157.

(i) Exercising any right or power permitted to limited partners under this act and not specifically enumerated in this subsection .

382

F.S. 1987 PARTNERSHIP LAWS Ch.620

(3) The enumeration in subsection (2) does not mean that the possession or exercise by a limited part­ner of any power other than a power enumerated in that subsection constitutes participation by him in the busi­ness of the limited partnership.

(4) A limited partner who knowingly permits his name to be used in the name of the limited partnership, except under a circumstance permitted by s. 620.1 03(2), is liable to creditors who extend credit to the limited partnership without actual knowledge that the limited partner is not a general partner.

History.-s. 25, ch. 86-263.

620.132 Liability of person erroneously believing himself to be a limited partner.-

(1) Except as provided in subsection (2), a person who makes a contribution to a business enterprise and erroneously but in good faith believes that he has be­come a limited partner in the enterprise is not a general partner in the enterprise and is not bound by its obliga­tions by reason of making the contribution, receiving dis­tributions from the enterprise, or exercising any rights of a limited partner if, within a reasonable time after ascer­taining the mistake, he:

(a) Causes an appropriate certificate of limited part­nership or a certificate of amendment to be executed and filed; or

(b) Withdraws from future equity participation in the enterprise by executing and filing with the Department of State a certificate declaring withdrawal under this section .

(2) A person who makes a contribution of the kind describeG in subsection (1) is liable as a general partner to any third party who transacts business with the enter­prise before the person withdraws and an appropriate certificate is filed to show withdrawal or before an appro­priate certificate is filed to show that the person is not a general partner, but in either case only if the third party actually believed in good faith that the person was a general partner at the time of the transaction .

History.-s. 26, ch. 86-263.

620.133 Voting rights of limited partners.-(1) A partnership agreement may provide for class­

es or groups of limited partners having such relative rights, powers, and duties as the partnership agreement may provide, and may make provision for the future cre­ation in the manner provided in the partnership agree­ment of additional classes or groups of limited partners having such relative rights, powers, and duties as may from time to time be established, including rights, pow­ers, and duties senior to existing classes and groups of limited partners.

(2) Subject to s. 620.129, the partnership agreement may grant to all or certain identified limited partners the right to vote on a per capita or any other basis, separate­ly or with all or any class or group of the limited partners or the general partners, on any matter.

(3) A partnership agreement which grants a right to vote may set forth provisions relating to notice of the time, place, or purpose of any meeting at which any mat­ter is to be voted on by any limited partners, waiver of any such notice, action by consent without a meeting, the establishment of a record date, quorum require-

ments, voting in person or by proxy, or any other matter with respect to the exercise of any such right to vote.

History.-s. 27, ch. 86-263.

620.134 Limited partner's right to inspect records and demand information.-Each limited partner has the right to:

(1) Inspect and copy any of the partnership records required to be maintained by s. 620.1 06; and

(2) Obtain from the general partners from time to time, upon reasonable demand, and subject to such rea­sonable standards as may be set forth in the partnership agreement or otherwise established by the general part­ners and for any purpose reasonably related to the limit­ed partner's interest as a limited partner:

(a) True and full information regarding the state of the business and financial condition of the limited part­nership;

(b) Promptly after becoming available, copies of the limited partnership 's federal, state, and local income tax returns for each year; and

(c) Such other information regarding the affairs of the limited partnership as is just and reasonable.

History.-s. 28, ch . 86-263.

620.135 Form of contribution.-The contribution of a partner may be in cash, property, or services ren­dered, or a promissory note or other obligation to con­tribute cash or property or to perform services .

History.-s. 29, ch. 86-263.

620.136 Liability for contribution.-(1) A promise by a limited partner to contribute to

the limited partnership is not enforceable unless it is set out in a writing signed by the limited partner.

(2) Except as provided in the partnership agree­ment, a partner is obligated to the limited partnership to perform any enforceable promise to contribute cash or property or to perform services, even if he is unable to perform because of his death or disability or any other reason . If a partner does not make the required contribu­tion of property or services, he is obligated, at the option of the limited partnership, to contribute cash equal to that portion of the value, as stated in the partnership rec­ords required to be kept pursuant to s. 620.106, of the stated contribution that has not been made.

(3) Unless otherwise provided in the partnership agreement, the obligation of a partner to make a contri­bution or return money or other property paid or distrib­uted in violation of this act may be compromised only by consent of all the partners. Notwithstanding the compro­mise, a creditor of a limited partnership who extends credit or otherwise acts in reliance on that obligation, af­ter the partner has signed a writing that indicates the ob­ligation and before tne amendment or cancellation of the writing to indicate the compromise, may enforce the original obligation.

(4) A partnership agreement may provide that the in­terest of any partner who fails to make any contribution that he is obligated to make shall be subject to specified penalties for, or specified consequences of, such failure. Such penalty or consequence may take the form of re­ducing the defaulting partner's proportionate interest in the limited partnership, subordinating his partnership in-

383

'

Ch.620 PARTNERSHIP LAWS F.S. 1987

terests to that of nondefaulting partners, a forced sale of his partnership interest, the forfeiture of his partner­ship interest , the lending by other partners of the amount necessary to meet his commitment, a fixing of the value of his partnership interest by appraisal or by formula and redemption or sale of his partnership inter­est at such value, or other penalty or consequence.

Hlstory.-s. 30, ch. 86-263.

620.137 Sharing of profits and losses.-The profits and losses of a limited partnership must be allocated among the partners, and among classes of partners, in the manner provided in writing in the partnership agree­ment. If the partnership agreement does not so provide in writing, profits and losses must be allocated on the basis of the value, as stated in the partnership records required to be kept pursuant to s: 620.106, of the contri­butions made by each partner to the extent they have been received by the partnership and have not been re­turned.

History.-s. 31 , ch. 86-263.

620.138 Sharing of distributions.-Distributions of cash or other assets of a limited partnership must be al­located among the partners, and among classes of part­ners, in the manner provided in writing in the partnership agreement. If the partnership agreement does not so provide in writing, distributions must be made on the ba­sis of the value, as stated in the partnership records re­quired to be kept pursuant to s. 620.106, of the contribu­tions made by each partner to the extent they have been received by the partnership and have not been returned.

Hlstory.-s. 32, ch. 86-263.

620.139 Interim distributions.-Except as provided ins. 620.147, a partner is entitled to receive distributions from a limited partnership before his withdrawal from the limited partnership and before the dissolution and the winding up thereof to the extent and at the times or upon the happening of the events specified in the part­nership agreement.

Hlstory.-s. 33, ch . 86-263.

620.142 Withdrawal of general partner.-A general partner may withdraw from a limited partnership at any time by giving written notice to the other partners, but if the withdrawal violates the partnership agreement, the limited partnership may recover from the withdrawing general partner damages for breach of the partnership agreement and offset the damages against the amount otherwise distributable to him.

Hlstory.-s. 34, ch. 86-263.

620.143 Withdrawal of limited partner.-A limited partner may withdraw from a limited partnership at the time or upon the happening of an event specified in writ­ing in the partnership agreement. If the agreement does not specify in writing the time or the events upon the happening of which a limited partner may withdraw or a definite time for the dissolution and the winding up of the limited partnership, a limited partner may withdraw upon not less than 6 months' prior written notice to each general partner at his address as set forth in the certifi­cate of limited partnership filed in the office of the De-

partment of State. Hlstory.-s. 35, ch. 86-263.

620.144 Distribution upon withdrawai.-Except as provided ins. 620.147, upon withdrawal, a withdrawing partner is entitled to receive any distribution to which he is entitled under the partnership agreement; and, if not otherwise provided in the agreement, he is entitled tore­ceive, within a reasonable time after withdrawal, the fair value of his interest in the limited partnership as of the date of withdrawal based upon his right to share in distri­butions from the limited partnership.

Hlstory.-s. 36, ch. 86-263.

620.145 Distribution in kind.-Except as provided in writing in the partnership agreement:

(1) A partner, regardless of the nature of his contri­bution, has no right to demand and receive any distribu­tion from a limited partnership in any form other than cash.

(2) A partner may not be compelled to accept a dis­tribution of any asset in kind from a limited partnership to the extent that the percentage of the asset distribut­ed to him exceeds a percentage of that asset which is equal to the percentage in which he shares in distribu­tions from the limited partnership.

Hlstory.-s. 37, ch. 86-263.

620.146 Right to distribution.-At the time a partner becomes entitled to receive a distribution, he has the status of, and is entitled to all remedies available to, a creditor of the limited partnership with respect to the distribution.

Hlstory.-s. 38, ch. 86-263.

620.147 Limitation on distribution.-A partner may not receive a distribution from a limited partnership to the extent that, after giving effect to the distribution, all liabilities of the limited partnership, other than liabilities to partners on account of their partnership interests, ex­ceed the fair value of the partnership assets.

Hlstory.-s. 39, ch . 86-263.

620.148 Liability upon return of contribution.-(1 )(a) If a partner receives the return of any part of

his contribution without violation of the partnership agreement or this act, he is liable to the limited partner­ship for a period of 1 year thereafter for the amount of the returned contribution, but only to the extent neces­sary to discharge the limited partnership's liabilities to creditors who extended credit to the limited partnership during the period the contribution was held by the part­nership.

(b) If a partner receives the return of any part of his contribution in violation of the partnership agreement or this act, he is liable to the limited partnership for a period of 6 years thereafter for the amount of the contribution wrongfully returned.

(2) A partner receives a return of his contribution to the extent that a distribution to him reduces his share of the fair value of the net assets of the limited partner­ship below the value, as set forth in the partnership rec­ords required to be kept pursuant to s. 620.106, of his contribution which has not been distributed to him.

Hlstory.-s. 40, ch. 86-263.

384

F.S. 1987 PARTNERSHIP LAWS Ch.620

620.149 Nature of partner's interest in the limited partnership.-A partnership interest is personal proper­ty.

Hlatory.-s. 41 , ch. 86-263.

620.152 Assignment of partnership interest.-(1) Unless otherwise provided in the partnership

agreement: (a) A partnership interest is assignable in whole or

in part; (b) An assignment of a partnership interest does not

dissolve a limited partnership or entitle the assignee to become or to exercise any rights or powers of a partner;

(c) An assignment entitles the assignee to share in such profits and losses, to receive such distribution or distributions, and to receive such allocation of income, gain, loss, deduction, or credit or similar item to which the assignor was entitled, to the extent assigned; and

(d) A partner ceases to be a partner and to have the power to exercise any rights or powers of a partner upon assignment of all of his partnership interests.

(2) The partnership agreement may provide that a partner's interest in a limited partnership may be evi­denced by a certificate of partnership interest issued by the limited partnership and may also provide for the as­signment or transfer of any partnership interest repre­sented by such a certificate and make other provisions with respect to such certificates.

Hlatory.-s. 42, ch. 86-263.

620.153 Rights of judgment creditor of partner.­On application to a court of competent jurisdiction by any juagment creditor of a partner, the court may charge the partnership interest of the partner with payment of the unsatisfied amount of the judgment with interest. To the extent so charged, the judgment creditor has only the rights of an assignee of the partnership interest. This act does not deprive any partner of the benefit of any exemption laws applicable to his partnership interest.

Hlatory.-s. 43, ch. 86-263.

620.154 Right of assignee to become limited part­ner.-

(1) An assignee of a partnership interest, including an assignee of a general partner, may become a limited partner if and to the extent that:

(a) The assignor gives the assignee that right in ac­cordance with authority described in the partnership agreement; or

(b) All other partners consent. (2) An assignee who has become a limited partner

has, to the extent assigned, the rights and powers, and is subject to the restrictions and liabilities, of a limited partner under the partnership agreement and this act. An assignee who becomes a limited partner also is liable for the obligations of his assignor to make and return contributions as provided in ss. 620.136 and 620.148. However, the assignee is not obligated for liabilities which are unknown to the assignee at the time he be­came a limited partner and which could not be ascer­tained from the partnership agreement.

(3) If an assignee of a partnership interest becomes a limited partner, the assignor is not released from his liability to the limited partnership under ss. 620.117 and

620.136. Hlatory.-s. 44, ch. 86-263.

620.155 Power of estate of deceased or incompe­tent partner.-lf a partner who is an individual dies or a court of competent jurisdiction adjudges a partner who is an individual to be incompetent to manage his person or his property, the partner's executor, administrator, guardian, conservator, or other legal representative may exercise all the partner's rights for the purpose of set­tling his estate or administering his property, including any power the partner had to give an assignee the right to become a limited partner. If a partner is a corporation, trust, or other entity and is dissolved or terminated, the powers of that partner may be exercised by its legal rep­resentative or successor.

Hlatory.-s. 45, ch. 86-263.

620.156 Property of limited partnership.-(1) All property originally brought into a limited part­

nership or subsequently acquired by a limited partner­ship by purchase or otherwise is partnership property.

(2) Unless otherwise provided in the certificate of limited partnership or by agreement of all general and limited partners of the limited partnership, property ac­quired with limited partnership funds is partnership property.

Hlatory.-s. 46, ch. 86-263.

620.157 Nonjudicial dissolution.-A limited partner­ship is dissolved, and its affairs must be wound up, upon the happening of the first to occur of the following events:

(1) At the time specified in the certificate of limited partnership.

(2) The happening of an event specified in writing in the partnership agreement.

(3) When all partners have given their written con­sent.

(4) The happening of an event of withdrawal of a general partner, unless at the time there is at least one other general partner and the written provisions of the partnership agreement permit the business of the limit­ed partnership to be carried on by the remaining general partner and that partner does so; but the limited partner­ship is not dissolved and is not required to be wound up by reason of any event of withdrawal if, within 90 days after the withdrawal, all partners agree in writing to con­tinue the business of the limited partnership and to the appointment of one or more additional general partners if necessary or desired.

(5) Entry of a decree of judicial dissolution under s. 620.158.

Hlatory.-s. 47 , ch. 86-263.

620.158 Judicial dissolution.-On application by or for a partner, the circuit court may order dissolution of a limited partnership if it is not reasonably practicable to carry on the business in conformity with the partnership agreement.

Hlatory.-s. 48, ch . 86-263.

620.159 Winding up affairs of limited partnership. (1) Unless otherwise provided in the partnership

agreement, the general partners who have not wrongful-

385

Ch.620 PARTNERSHIP LAWS F.S. 1987

ly dissolved a limited partnership, or, if none, the limited partners, may wind up the limited partnership's affairs; but the circuit court , upon cause shown, may wind up the limited partnership 's affairs upon application of any partner or his legal representative or assignee, and in connection therewith may appoint a liquidating trustee.

(2) Upon dissolution of a limited partnership and un­til the filing of a certificate of cancellation, persons wind­ing up the limited partnership 's affairs may, in the name of, and for and on behalf of, the limited partnership, pros­ecute and defend suits , whether civil , criminal , or admin­istrative, gradually settle and close the limited partner­ship's business, dispose of and convey the limited part­nership's property, discharge the limited partnership's liabilities, and distribute to the partners any remaining assets of the limited partnership, all without affecting the liability of limited partners.

History.-s. 49. ch. 86-263.

620.162 Distribution of assets.-Upon the winding up of a limited partnership, the assets must be distribut­ed as follows:

(1) To creditors , including partners who are credi­tors, to the extent permitted by law in satisfaction of lia­bilities of the limited partnership, whether by payment or by establishment of reserves, other than liabilities for distributions to partners under s. 620.139 or s. 620.144;

(2) Except as provided in the partnership agree­ment, to partners and former partners in satisfaction of liabilities for distributions under s. 620.139 or s. 620.144; and

(3) Except as provided in the partnership agree­ment, to partners first for the return of their contributions and secondly respecting their partnership interests, in the proportions in which the partners share in distribu­tions.

History.-s. 50. ch. 86- 263.

620.163 Right of limited partner to bring derivative action.-A limited partner may bring an action in the right of a limited partnership to recover a judgment in its favor if general partners with authority to do so have re­fused to bring the action or if an effort to cause those general partners to bring the action is not likely to suc­ceed .

History.-s. 51 . ch. 86- 263.

620.164 Derivative action; proper plaintiff.-ln a derivative action:

(1) The plaintiff must be a partner at the time of bringing the action and at the time of the transaction of which he complains; or

(2) The plaintiff must be a partner at the time of bringing the action and his status as a partner must have devolved upon him by operation of law or pursuant to the terms of the partnership agreement from a person who was a partner at the time of the transaction .

History.-s. 52. ch. 86-263.

620.165 Derivative action; pleading.-ln a deriva­tive action, the complaint must set forth with particulari­ty the effort of the plaintiff to secure initiation of the ac­tion by a general partner or the reasons for not making the effort.

Hlstory.-s. 53. ch. 86- 263.

620.166 Derivative action; expenses.-lf a deriva­tive action is successful , in whole or in part, or if anything is received by the plaintiff as a result of a judgment, compromise, or settlement of any such action or claim , the court may award the plaintiff reasonable expenses, including reasonable attorney's fees . If anything is so re­ceived by the plaintiff, the court shall make such award of plaintiff's expenses payable out of those proceeds and direct the plaintiff to remit to the limited partnership the remainder thereof and, if those proceeds are insuffi­cient to reimburse plaintiff 's reasonable expenses, the court may direct that any such award of plaintiff 's ex­penses or a portion thereof be paid by the limited part­nership.

Hlatory.- s. 54, ch . 86-263.

620.167 Laws governing foreign limited partner­ship.-Subject to the constitution of this state, the laws of the state under which a foreign limited partnership is organized govern its organization and internal affairs and the liability of its limited partners, and a foreign limit­ed partnership may not be denied registration by reason of any difference between those laws and the laws of this state.

Hlatory.- s. 55, ch. 86-263.

620.168 Name under which foreign limited partner­ship may register.-A foreign limited partnership may register with the Department of State under any name, whether or not it is the name under which it is registered in its state of organization , that includes the words "Lim­ited" or its abbreviation "Ltd." and that could be regis­tered by a domestic limited partnership.

Hlatory.- s. 56, ch. 86-263.

620.169 Registration of foreign limited partnership. -Before transacting business in this state, a foreign lim­ited partnership must register with the Department of State. In order to register, a foreign limited partnership must submit to the department, in duplicate, an applica­t ion for registration as a foreign limited partnership, signed and sworn to by a general partner and setting forth:

(1) The name of the foreign limited partnership and, if different, the name under which it proposes to register and transact business in this state;

(2) The state, and date, of its formation ; (3) The name and address of any agent for service

of process on the foreign limited partnership that the for­eign limited partnership elects to appoint; but the agent must be an individual resident of this state, a domestic corporation, or a foreign corporation having a place of business in, and authorized to do business in, this state;

(4) A statement that the Secretary of State is ap­pointed the agent of the foreign limited partnership for service of process if an agent has not been appointed under subsection (3) or, if an agent has been appointed , if the agent's authority has been revoked or the agent cannot be found or served with the exercise of reason­able diligence;

(5) The address of the office required to be main­tained in the state of its organization by the laws of that state or , if not so required , of the principal office of the foreign limited partnership;

386

F.S. 1987 PARTNERSHIP LAWS Ch.620

(6) The name and the business address of each general partner;

(7) The address of the office at which is kept a list of the names and addresses of the limited partners and their capital contributions, together with an undertaking by the foreign limited partnership to keep those records until the foreign limited partnership's registration in this state is canceled or withdrawn; and

(8) A mailing address for the foreign limited partner­ship.

An affidavit declaring the amount of the capital contribu­tions of the limited partners and the anticipated amount of the capital contributions of the limited partners that are allocated for the purpose of transacting business in this state must accompany the application for registra­tion.

Hlstory.-s. 57, ch. 86-263.

620.172 Issuance of certificate of registration to foreign limited partnership.-

(1) If the Department of State finds that an applica­tion for registration conforms to law and all requisite fees have been paid, it shall:

{a) Endorse on the application the word "Filed" and the day, month, and year of the filing thereof, which en­dorsement shall be conclusive of the date and time of its filing in the absence of actual fraud;

(b) File in its office a duplicate original copy of the application; and

(c) Issue a certificate of registration to transact busi­ness in this state. . (2) The department shall return the certificate of reg­Istration, together with a duplicate original copy of the application similarly endorsed, to the person who filed the application or his representative.

Hlstory.-s. 58, ch . 86-263.

620.173 Amendments to registration application.­lf any statement in the application for registration of a foreign limited partnership was false when made or any arrangements or other facts described in the application have changed, making the application false in any re­spect, the foreign limited partnership shall promptly file with the Department of State a certificate, signed and acknowledged or sworn to by a general partner, correct­ing such statement.

Hlstory.-s. 59, ch. 86-263.

620.17 4 Cancellation of registration of foreign lim­ited partnership.-

(1) A foreign limited partnership may cancel its reg­istration by filing with the Department of State a certifi­cate of cancellation signed and acknowledged or sworn to by a general partner.

(2) A cancellation does not terminate the authority of the Secretary of State to accept service of process on the foreign limited partnership with respect to causes of action arising out of the transaction of business in this state.

History.-s. 60, ch. 86-263.

620.175 Action to restrain foreign limited partner­ship from transacting business.-The Attorney General may bring an action to enjoin a foreign limited partner-

ship from transacting business in this state in violation of s. 620.169.

Hlstory.-s. 61 , ch. 86-263.

620.176 Supplemental affidavit of capital contribu­tions.-A foreign limited partnership must file a supple­mental affidavit declaring the amount of the capital con­tributions of the limited partners that is allocated for the purpose of transacting business in this state with the Department of State within 30 days of any time when the actual amount of capital contributions allocated for the purpose of transacting business in this state exceeds the anticipated amount of capital contributions allocated for the purpose of transacting business in this state filed pursuant to s. 620.169.

Hlstory.-s. 62, ch. 86-263.

620.177 Annual report of domestic or foreign limit­ed partnership.-

(1) Each domestic or foreign limited partnership authorized to transact business in this state shall file with the Department of State, on or before January 1 of each year, a sworn report on such forms as the depart­ment prescribes, which report must set forth:

(a) If a domestic limited partnership, the name of the limited partnership or, if a foreign limited partnership, the name under which it is registered to transact busi­ness in this state.

(b) The name of the state of formation. (c) The date of formation in this state or the date of

original registration in this state. (d) If a domestic limited partnership, the address of

the office, and the name and address of the agent for service of process, required to be maintained by s. 620.105; or, if a foreign limited partnership, the address of the office required to be maintained by s. 620.169 and the name and address of any agent for service of proc­ess appointed pursuant to s. 620.169.

(e) The name and the business address of each general partner.

(f) A mailing address for the partnership. (g) If a domestic limited partnership, the amount of

the capital contributions of its limited partners or, if a for­eign limited partnership, the amount of the capital contri­butions of its limited partners that is allocated for the purpose of transacting business in this state.

{h) Any additional information that is necessary or appropriate to enable the department to carry out the provisions of this act.

(2) Each report must be executed by a general part­ner of the partnership or, if the partnership is in tKe hands of a receiver or trustee, must be executed on be­half of the partnership by the receiver or trustee.

(3) Proof to the satisfaction of the department that the annual report was deposited, on or before January 1 of the year subsequent to the report year, in the United States mail in a sealed envelope, properly addressed with postage prepaid, is considered proof of compliance with the time requirement.

(4) The department shall examine each annual re­port when received; and, if it finds that the report con­forms to the requirements of this section, it shall file the report as information and keep such report as a public record. If the department finds that the report does not

387

Ch.620 PARTNERSHIP LAWS F.S. 1987

so conform, the department shall promptly return the re­port to the partnership for correction, in which event, if such report is corrected to conform with the require­ments of this section and returned to the department within 30 days from the date on which the report was mailed to the partnership by the department, the penal­ties provided in s. 620.178 will not apply.

(5) The department shall prescribe the forms on which to make the annual reports called for in this sec­tion and shall furnish blank forms on request.

Hlatory.-s. 63, ch. 86- 263.

620.178 Revocation of authority to transact busi­ness; reinstatement.-

( 1) The authority of a domestic or foreign limited partnership to transact business in this state may be re­voked by the Department of State upon the conditions prescribed in this section if:

(a) The partnership has failed to file its annual report within the time required by s. 620.177 or has failed to pay any fee prescribed by s. 620.182 when the fee has be­come due and payable;

(b) The partnership has failed to file any amendment to its certificate of limited partnership or registration ap­plication required by this act; or

(c) A fraudulent misrepresentation or concealment has been made of any material matter in a certificate, ap­plication, affidavit, report, or other document submitted by the partnership pursuant to this act.

(2) The authority of a domestic or foreign limited partnership to transact business in this state may not be revoked by the department unless:

(a) The department has given the partnership at least 60 days ' notice of the revocation by mail ad­dressed to the partnership at the mailing address most recently filed with the department; and

(b) The partnership fails up to the revocation date to file such annual report or amendment, pay such fee, or correct such misrepresentation .

(3) Upon revoking the authority of a domestic or for­eign limited partnership to transact business in this state, the department shall issue a certificate of revoca­tion and mail a copy of the certificate to the partnership at the mailing address for the partnership most recently filed with the department. Upon the issuance of the cer­tificate of revocation , the authority of the partnership to transact business in this state ceases.

(4) A domestic or foreign limited partnership that transacts business in this state when its authority to do so has been revoked is liable to this state, for each year or part of a year during which it transacted business without authority, in an amount equal to the amount of all fees that would have been imposed under this act upon such partnership had it duly filed all required annu­al reports and amendments to its certificate of limited partnership or registration application and paid all re­quired fees. In addition to the payments thus pre­scribed, the department shall , prior to reinstatement of the partnership's authority to transact business in this state, collect from such partnership a fine in the amount of $500 for each such year or part of a year during which the partnership so transacted business without authori­ty.

(5) Any domestic or foreign limited partnership whose certificate of limited partnership or registration has been revoked by the department under this section or prior law may have its certificate of limited partnership or registration reinstated at any time upon the approval of an application for reinstatement signed by all general partners. The department shall approve and file such application and reinstate such certificate if it is estab­lished to the satisfaction of the department that there was no cause for the revocation , or that the reasons for the revocation have been corrected , and when all fees and penalties imposed pursuant to this act have been paid .

(6) The department shall require the domestic or for­eign limited partnership to amend its certificate of limit­ed partnership or registration application before accept­ing its application for reinstatement if another person has lawfully assumed the name, or a name substantially similar to the name, of the limited partnership or the name under which the partnership is registered in this state. However, the name of a limited partnership whose certificate of limited partnership or registration has been revoked will not be available for the assumption or use of the name by another person until 1 year after the date of the issuance of the certificate of revocation.

(7) The provisions of subsection (1) do not exclude actions or special proceedings by the Attorney General or any state agency or official for the annulment, dissolu­tion , or cancellation of a certificate of limited partnership or of registration for any other cause as provided by law.

Hlatory.-s. 64, ch. 86-263.

620.179 Transaction of business without registra­tion or after revocation of authority; effect.-

(1) A foreign limited partnership transacting busi­ness in this state may not maintain any action, suit, or proceeding in any court of this state until it has regis­tered in this state.

(2) A domestic or foreign limited partnership trans­acting business in this state after its authority to do so has been revoked under s. 620.178 may not maintain any action , suit, or proceeding in any court of this state until the partnership obtains authority to transact busi­ness in this state by reinstatement of its certificate of limited partnership or registration as provided in s. 620.178; and an action , suit , or proceeding may not be maintained in any court of this state by any successor or assignee of the partnership on any right, claim, or de­mand arising out of the transaction of business by such partnership after revocation of its certificate of limited partnership or registration until the partnership, or any person that has acquired all or substantially all of its as­sets, has had the certificate of limited partnership or reg­istration of the partnership reinstated pursuant to s. 620.178.

(3) The failure of a foreign limited partnership to reg­ister in this state, or the failure of a domestic or foreign limited partnership to continue in effect its authority to transact business in this state, does not impair the valid­ity of any contract, deed, mortgage, security interest, lien, or act of the partnership or prevent the partnership from defending any action, suit, or proceeding in any court of this state.

388

F.S. 1987 PARTNERSHIP LAWS Ch.620

(4) A foreign limited partnership by transacting busi­ness in this state without registration appoints the Sec­retary of State as its agent for service of process with respect to claims for relief arising out of the transaction of business in this state.

(5) A limited partner of a foreign limited partnership is not liable as a general partner of the foreign limited partnership solely by reason of the partnership's having transacted business in this state without registration.

Hlstory.-s. 65, ch. 86-263.

620.182 Fees of the Department of State.-The fees of the Department of State under this act are as fol­lows:

(1) For furnishing a certified copy, $15 for the first 15 pages plus 50 cents for each additional page.

(2) For filing an original certificate of limited partner­ship, an amount based upon the anticipated amount of capital contributions of the limited partners, calculated at the rate of $4 per $1 ,000 of such contributions; but the amount of such filing fee may not be less than $30 or more than $1 ,000.

(3) For filing an original application for registration as a foreign limited partnership, an amount based upon the anticipated amount of capital contributions of the limited partners that is allocated for the purpose of transacting business in this state, calculated at the rate of $4 per $1 ,000 of such contributions; but the amount of such fil­ing fee may not be less than $30 or more than $1 ,000.

(4) For filing a supplemental affidavit declaring the amount of capital contributions of the limited partners when there is an increase in capital contribution beyond the anticipated amount, an amount based upon the ad­ditional amount of capital contributions of the limited partners, calculated at the rate of $4 per $1,000 of such contributions; but the amount of such filing fee may not be less than $30 or more than $1 ,000.

(5) For filing an annual report, if a domestic limited partnership, an amount based upon the amount of the capital contributions of the limited partners, calculated at the rate of $4 per $1,000 of such contributions, or, if a foreign limited partnership, an amount based upon the amount of capital contributions of the limited partners that is allocated for the purpose of transacting business in this state, calculated at the rate of $4 per $1 ,000 of such contributions; but the amount of such filing fee may not be less than $30 or more than $250.

(6) For filing a certificate designating a registered agent, changing a registered agent, or resigning as a registered agent, $3.

(7) For filing an application to reserve a limited part­nership name or a notice of transfer of a reserved limited partnership name, $5.

(8) For filing a certificate of cancellation of limited partnership or of registration, $30.

(9) For filing any other domestic or foreign limited partnership document, $30.

(1 0) For furnishing a certificate of fact, $5. Hlstory.-s. 66, ch. 86-263.

620.183 Disposition of moneys collected.-The Department of State shall pay into the Corporations Trust Fund all moneys collected under the provisions of

this act. Hlstory.-s. 67, ch . 86-263.

620.184 Construction and application of act.-(1) This act shall be so applied and construed to ef­

fectuate its general purpose to make uniform the law with respect to the subject of this act among states en­acting it.

(2)(a) Sections 620.135, 620.136, and 620.148 apply only to contributions and distributions made after Janu­ary 1, 1987.

(b) Section 620.154 applies only to assignments made after January 1, 1987.

(c) Unless otherwise agreed by the partners, the ap­plicable provisions of existing law governing allocation of profits and losses, rather than the provisions of s. 620.137; distributions to a withdrawing partner, rather than the provisions of s. 620.144; and distribution of as­sets upon the winding up of a limited partnership, rather than the provisions of s. 620.162, govern limited partner­ships formed before January 1, 1987.

(3) With respect to a limited partnership formed prior to January 1, 1987:

(a) Except as provided in paragraph (b), such limit­ed partnership need not file with the Department of State a certificate of amendment which would cause its certificate of limited partnership to comply with this act until the occurrence of an event which, under this act, requires the filing of a certificate of amendment.

(b) Such limited partnership need not file an affidavit pursuant to s. 620.108, s. 620.112, s. 620.169, or s. 620.176 until there is a change in capital contribution which would require a certificate of amendment to be filed under prior law.

Hlstory.-s. 66, ch. 86-263.

620.185 Effect of repeal of prior statutes.-The re­peal of any statutory provision by chapter 86-263, Laws of Florida, does not impair or otherwise affect the organi­zation or the continued existence of a limited partner­ship existing on January 1, 1987, nor does the repeal of any existing statutory provision by chapter 86-263, Laws of Florida, impair any contract or affect any right accrued before January 1, 1987.

Hlstory.-s. 69, ch. 86-263.

620.186 Applicability of Uniform Partnership Act.­ln any case not provided for in this act, the provisions of the Uniform Partnership Act and the rules of law and equity shall govern.

Hlstory.-s. 70, ch. 86-263.

620.192 Registered agent; duties.-(1) This section applies to each domestic limited

partnership and applies to each foreign limited partner­ship that owns real property located in this state, owns a mortgage on real property located in this state, or transacts business in this state.

(2) Each domestic and each foreign limited partner­ship subject to this section shall have and continuously maintain in this state a registered office and registered agent, and shall file with the Department of State notice of the registered office and registered agent. The ap­pointment of a registered agent in this state pursuant to

389

Ch.620 PARTNERSHIP LAWS F.S. 1987

the provisions of ss. 620.105 and 620.108 or s. 620.169 is sufficient to meet the requirement for a registered agent under this section , provided that the registered agent so appointed files , in such form and manner as prescribed by the Department of State, an acceptance of the obligations provided for in this section. A foreign limited partnership may meet the requirement for a reg­istered office in this state by designating the street ad­dress of the registered agent as its registered office in the notice filed with the Department of State.

(3) Each domestic and each foreign limited partner­ship subject to this section shall , pursuant to subpoena served upon the registered agent by the Department of Legal Affairs, produce, through its registered agent or through a designated representative within 30 days af­ter service of the subpoena, testimony and records re­flecting the following :

(a) True copies of the partnership agreement or oth­er documents evidencing such domestic or foreign limit­ed partnership 's legal existence;

(b) The names and addresses of all general part­ners;

(c) The names and addresses of all prior general partners for a period not to exceed 5 years preceding the date of issuance of the subpoena;

(d) The names and addresses of all limited partners, the number of which names is limited to the names of the 100 limited partners that , in comparison to all other limited partners, own the largest number of shares or other units of ownership in the domestic or foreign limit­ed partnership;

(e) The names and addresses of all prior limited partners for the 12-month period preceding the date of issuance of the subpoena, the number of which names is limited to the names of the 100 limited partners that , in comparison to all other limited partners, owned the largest number of shares 1or other units of ownership in the domestic or foreign limited partnership.

(f) The names and addresses of the person or per­sons who provided the records and information to the registered agent or designated representative of the do­mestic or foreign limited partnership.

(4) The time limit for producing records and testimo­ny may be extended for good cause shown by the do­mestic or foreign limited partnership.

(5) A domestic or foreign limited partnership desig­nating an attorney, accountant, or spouse as a regis­tered agent or designated representative shall , with re­spect to this state or any agency or subdivision of this state, be deemed to have waived any privilege that might otherwise attach to communications with respect to the information required to be produced pursuant to subsection (3), which communications are among such domestic or foreign limited partnership, the registered agent or designated representative of such domestic or foreign limited partnership, and the partners of such do­mestic or foreign limited partnership. The duty to comply with the provisions of this section will not be excused by virtue of any privilege or provision of law of this state or any other state or country, which privilege or provision authorizes or directs that the testimony or records re­quired to be produced under subsection (3) are privi­leged or confidential or otherwise may not be disclosed.

(6)(a) If a domestic or foreign limited partnership fails to comply with the requirements of subsection (2), the Department of Legal Affairs may pursue, in addition to any other remedies and penalties provided by law, the same remedies and penalties against such domestic or foreign limited partnership as are authorized in s. 607 .325( 1 )(b) for failure of a corporation to comply with the requirements of s. 607 .325(1 ).

(b) If a domestic or foreign limited partnership fails to comply with the requirements of subsection (3), the Department of Legal Affairs may pursue, in addition to any other remedies and penalties provided by law, the same remedies and penalties against such domestic or foreign limited partnership as are authorized in s. 607.325(5) for failure of a corporation to comply with the requirements of s. 607.325(2).

(7) Information provided to, and records and tran­scriptions of testimony obtained by, the Department of Legal Affairs pursuant to this section are confidential and are not public records under chapter 119. This ex­emption is subject to the "Open Government Sunset Re­view Act" in accordance with s. 119.14. The department shall not disclose such information, records, or transcrip­tions of testimony except, pursuant to the authorization by the Attorney General, in any of the following circum­stances:

(a) To a law enforcement agency participating in or conducting a civil investigation under chapter 895 or participating in or conducting a criminal investigation.

(b) In the course of filing, participating in, or con­ducting a judicial proceeding instituted pursuant to this section or chapter 895.

(c) In the course of filing , participating in, or con­ducting a judicial proceeding to enforce an order or judgment entered pursuant to this section or chapter 895.

(d) In the course of a criminal proceeding .

A person or law enforcement agency which receives any information, record , or transcription of testimony that has been made confidential by this subsection shall maintain the confidentiality of such material and shall not disclose such information, record, or transcription of testimony except as provided for herein. Any person who willfully discloses any information , record, or tran­scription of testimony that has been made confidential by this subsection , except as provided for herein, is guilty of a felony of the third degree, punishable as pro­vided in s. 775.082 or s. 775.083. If any information , rec­ord, or testimony obtained pursuant to subsection (3) is offered in evidence in any judicial proceeding, the court may, in its discretion , seal that portion of the record to further the policies of confidentiality set forth herein .

(8) This section is supplemental and shall not be construed to preclude or limit the scope of evidence­gathering or other permissible discovery pursuant to any other subpoena or discovery method authorized by law or rule of procedure.

(9) It is unlawful for any person, with respect to any record or testimony produced pursuant to a subpoena issued by the Department of Legal Affairs under subsec­tion (3) , to knowingly and willfully falsify, conceal , or cov­er up a material fact by a trick, scheme, or device; make

390

F.S. 1987 PARTNERSHIP LAWS Ch.620

any false , fictitious, or fraudulent statement or represen­tation; or make or use any false writing or document knowing the writing or document to contain any false, fictitious, or fraudulent statement or entry. A person who violates this provision is guilty of a felony of the third de­gree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

(10) In the absence of a written agreement to the con­trary, a registered agent is not liable for the failure to give notice of the receipt of a subpoena under subsec­tion (3) to the domestic or foreign limited partnership which appointed such registered agent if such regis­tered agent timely sends written notice of the receipt of such subpoena by first-class mail or domestic or inter­national air mail , postage fees prepaid, to the last ad­dress that has been designated in writing to the regis­tered agent by such appointing domestic or foreign lim­ited partnership.

(11) The designation of a registered agent and a reg­istered office as required by subsection (2) for a foreign limited partnership which owns real property in this state or a mortgage on real property in this state is solely for the purposes of this act; and, notwithstanding s. 48.131 or any other relevant section of the Florida Statutes, such designation shall not be used in determining whether the foreign limited partnership is actually doing business in this state.

History.-s. 73, ch. 86- 263. 1Note.- The word ~or" was substituted by the editors for the word ·or to conform

to the immediately preceding context.

620.56 620.565 620.57 620.575 620.58 620.585 620.59

620.595 620.60 620.605

620.61 620.615

620.62 620.625

620.63 620.635 620.64 620.645

620.65 620.655 620.66 620.665 620.67

PART II

UNIFORM PARTNERSHIP ACT

Short title . Definition of terms. Interpretation of knowledge and notice. Rules of construction . Rules for cases not provided for in this part. "Partnership" defined. Rules for determining the existence of a part-

nership. Partnership property. Partner agent of partnership. Conveyance of real property of the partner­

ship. Partnership bound by admission of partner. Partnership charged with knowledge of or no­

tice. Partnership bound by partner's wrongful act. Partnership bound by partner's breach of

trust. Nature of partner's liability. Partner by estoppel. Liability of incoming partner. Rules determining rights and duties of part-

ners. Partnership books. Duty of partners to render information. Partner accountable as a fiduciary . Right to an account. Continuation of partnership beyond fi xed

term .

391

620.675 620.68

620.685 620.69 620.695 620.70 620.705 620.71 620.715 620.72

620.725

620.73

620.735

620.74 620.745

620.75

620.755 620.76

620.765

620.77

Extent of property rights of a partner. Nature of a partner's right in specific partner-

ship property. Nature of partner's interest in the partnership. Assignment of partner's interest. Partner's interest subject to charging order. "Dissolution" defined. Partnership not terminated by dissolution . Causes of dissolution . Dissolution by decree of court. General effect of dissolution on authority of

partner. Right of partner to contribution from copart­

ners after dissolution. Power of partner to bind partnership to third

persons after dissolution . Effect of dissolution on partner's existing lia­

bility. Right to wind up. Rights of partners to application of partner­

ship property. Rights when partnership is dissolved for fraud

or misrepresentation . Rules for distribution . Liability of persons continuing the business in

certain cases. Rights of retiring partner or estate of de­

ceased partner when the business is con­tinued.

Accrual of actions.

620.56 Short title.-This part may be cited as the "Uniform Partnership Act. "

Hlstory.- s. 1, ch. 72-108.

620.565 Definition of terms.-ln this part: (1) "Court" means every court and judge having juris­

diction in the action . (2) "Business" means every trade, occupation , or

profession. (3) "Person" means those entities listed in s. 1.01 (3). (4) "Bankrupt" means a bankrupt under the Federal

Bankruptcy Act or an insolvent person under any state insolvency act.

(5) "Conveyance" means every assignment, lease, mortgage, or encumbrance.

(6) "Real property" means land and any interest or estate in land.

Hlstory.-s. 2, ch. 72-108.

620.57 Interpretation of knowledge and notice.-ln this part:

(1) A person has knowledge of a fact not only when he has actual knowledge of it , but also when he has knowledge of such other facts as in the circumstances show bad faith .

(2) A person has notice of a fact when another per­son claiming the benefit of the notice:

(a) States the fact to the person, or (b) Delivers through the mail or by other means of

communication a written statement of the fact to the person or to his agent at his place of business or resi­dence.

Hlstory.-s. 3, ch. 72-108.

Ch.620 PARTNERSHIP LAWS F.S. 1987

620.575 Rules of construction.-(1) The rule that statutes in derogation of the com­

mon law are to be strictly construed shall have no appli­cation to this part.

(2) The law of estoppel and of agency shall apply un­der this part.

(3) This part shall be so interpreted and construed as to make uniform the law of those states that enact it.

(4) This part shall not be construed to impair the obli­gation of any contract existing when the act goes into effect nor to affect any action or proceedings begun or right that has accrued before this act takes effect, but otherwise all partnerships shall be governed by this part, whether formed before or after its effective date.

Hlatory.-s. 4, ch. 72-108.

620.58 Rules for cases not provided for in this part. -In any case not provided for in this part, the rules of law and equity, including the law merchant, shall govern.

Hlatory.-s. 5. ch. 72-108.

620.585 "Partnership" defined.-(1) A "partnership" is an association of two or more

persons to carry on a business for profit as coowners. (2) An association formed under any other statute of

this state, or any statute adopted by authority other than the authority of this state, is not a partnership under this part unless the association would have been a partner­ship in this state before the adoption of this part. This part shall apply to limited partnerships except insofar as the statutes relating to limited partnerships are inconsis­tent with this part.

Hlatory.-s. 6. ch. 72-108.

620.59 Rules for determining the existence of a partnership.-ln determining whether a partnership ex­ists, these rules shall apply:

(1) Except as provided by s. 620.635, persons who are not partners as to each other are not partners as to third persons.

(2) Joint tenancy, tenancy in common, tenancy by the entireties, joint property, common property, or part ownership of itself does not establish a partnership, whether the coowners do or do not share any profits made by the use of the property.

(3) The sharing of gross returns of itself does not es­tablish a partnership, whether the persons sharing them do or do not have a joint or common right or interest in any property from which the returns are derived.

(4) The receipt by a person of a share of the profits of a business is prima facie evidence that he is a partner in the business, but no such inference shall be drawn if the profits were received in payment:

(a) Of a debt by installments or otherwise; (b) As wages of an employee or rent to a landlord; (c) As an annuity to a widow or representative of a

deceased partner; (d) As interest on a loan , though the amount of pay­

ment varies with the profits of the business; or (e) As the consideration for the sale of goodwill of a

business or other property by installments or otherwise. Hlatory.-s. 7, ch. 72-108.

620.595 Partnership property.-(1) All property originally brought into the partner­

ship or subsequently acquired by purchase or otherwise on account of the partnership is partnership property.

(2) Unless a contrary intention appears, property ac-quired with partnership funds is partnership property.

(3) Any estate in real property may be acquired in the partnership name. Title so acquired may be con­veyed in the partnership name.

(4) A conveyance to a partnership in the partnership name, though without words of inheritance, passes the entire estate of the grantor, unless a contrary intent ap­pears.

Hlatory.-s. 8, ch . 72-108.

620.60 Partner agent of partnership.-(1) Every partner is an agent of the partnership for

the purpose of its business. The act of every partner, in­cluding the execution in the partnership name of any in­strument, for apparently carrying on in the usual way the business of the partnership of which he is a member, binds the partnership, unless the partner so acting has in fact no authority to act for the partnership in the par­ticular matter, and the person with whom he is dealing has knowledge of the fact that he has no authority.

(2) An act of a partner that is not apparently for the carrying on of the business of the partnership in the usu­al way does not bind the partnership unless authorized by the other partners.

(3) Unless authorized by the other partners or un­less they have abandoned the business, one or more, but less than all, of the partners have no authority to:

(a) Assign the partnership property in trust for credi­tors or on the assignee 's promise to pay the debts of the partnership.

(b) Dispose of the goodwill of the business. (c) Do any other act that would make it impossible

to carry on the ordinary business of a partnership. (d) Confess a judgment. (e) Submit a partnership claim or liability to arbitra­

tion or reference. (4) No act of a partner in contravention of a restric­

tion on authority shall bind the partnership to persons having knowledge of the restriction.

Hlatory.-s. 9, ch. 72-108.

620.605 Conveyance of real property of the part­nership.-

(1) When title to real property is in the partnership name, any partner may convey title to the property by a conveyance executed in the partnership name; but the partnership may recover the property unless the part­ner's act binds the partnership under the provisions of s. 620.60(1 ), or unless the purchaser or his assignee is a holder for value without knowledge that the partner has exceeded his authority in making the conveyance. When title is held in the partnership name and it is nec­essary to identify the partners at the time of a convey­ance, encumbrance, or other instrument affecting part­nership real property, one of the partners may execute an affidavit stating the names of the partners and that they are the partners then existing. The affidavit shall be conclusive as to the facts therein stated as to purchas­ers without notice.

392

F.S. 1987 PARTNERSHIP LAWS Ch.620

(2) When title to real property is in the name of one or more, but not all, of the partners, and the public rec­ords do not disclose the right of the partnership, the partners in whose name the title stands may convey title to the property, but the partnership may recover the property if the partners ' act does not bind the partner­ship under the provisions of s. 620.60(1) unless the pur­chaser or his assignee is a holder for value without knowledge that the partners have exceeded their au­thority in making the conveyance.

(3) When the title to real property is in the names of all the partners, a conveyance must be executed by all the partners, including the personal representative of a deceased partner.

Hlatory.-s. 10, ch. 72-108; s. 159, ch. 73-333.

620.61 Partnership bound by admission of partner. -An admission or representation made by any partner concerning partnership affairs within the scope of his au­thority is evidence against the partnership.

Hlatory.-s. 11, ch. 72-108.

620.615 Partnership charged with knowledge of or notice.-Notice to any partner of a matter concerning partnership affairs, and the knowledge of the partner acting in the particular matter, acquired while a partner or then present to his mind, and the knowledge of any other partner who reasonably could and should have communicated it to the acting partner, operate as notice to or knowledge of the partnership, except in the case of a fraud on the partnership committed by or with the consent of that partner.

Hlatory.-s. 12, ch. 72-108.

620.62 Partnership bound by partner's wrongful act.-When loss or injury is caused to a person, not a partner in the partnership, or any penalty is incurred by a wrongful act or omission of a partner acting in the ordi­nary course of the business of the partnership or with the authority of his copartners, the partnership is liable for it to the same extent as the partner so acting or omit­ting to act.

Hlatory.-s. 13, ch. 72-108.

620.625 Partnership bound by partner's breach of trust.-The partnership is bound to make good the loss:

(1) When one partner acting within the scope of his apparent authority receives money or property of a third person and misapplies it; and

(2) When the partnership in the course of its busi­ness receives money or property of a third person and the money or property so received is misapplied by a partner while it is in the custody of the partnership.

Hlatory.-s. 14, ch. 72-108.

620.63 Nature of partner's liability.-AII partners are liable:

(1) Jointly and severally for everything chargeable to the partnership under ss. 620.62 and 620.625.

(2) Jointly for all other debts and obligations of the partnership; but a partner may enter into a separate obli­gation to perform a partnership contract.

Hlatory.-s. 15, ch. 72-108.

620.635 Partner by estoppel.-(1) When a person represents himself, or consents

to another representing him, to anyone as a partner in an existing partnership or with one or more persons not actual partners by words spoken or written or by con­duct, he is liable to any person to whom the representa­tion has been made who has given credit on the faith of the representation to the actual or apparent partnership, and if he has made the representation or consented to its being made in a public manner, he is liable to the per­son, whether the representation has or has not been made or communicated to the person giving credit by or with the knowledge of the apparent partner making the representation or consenting to its being made.

(a) When a partnership liability results, he is liable as though he were an actual member of the partnership.

(b) When no partnership liability results, he is liable jointly with the other persons, if any, so consenting to the contract or representation as to incur liability; other­wise he is liable separately.

(2) When a person has been thus represented to be a partner in an existing partnership, or with one or more persons not actual partners, he is an agent of the per­sons consenting to the representation to bind them to the same extent and in the same manner as though he were a partner with respect to persons who rely upon the representation. When all members of the existing partnership consent to the representation, a partnership act or obligation results ; but otherwise it is the joint act or obligation of the person acting and the persons con­senting to the representation .

Hlatory.-s. 16, ch . 72-108.

620.64 Liability of incoming partner.-A person ad­mitted as a partner into an existing partnership is liable for all the obligations of the partnership arising before his admission as though he had been a partner when the obligations were incurred, except that this liability shall be satisfied only out of partnership property.

Hlatory.-s. 17, ch. 72-108.

620.645 Rules determining rights and duties of partners.-The rights and duties of the partners in rela­tion to the partnership shall be determined, subject to any agreement between them, by the following rules:

(1) Each partner shall be repaid his contributions, whether by way of capital or advances, to the partner­ship property, and shall share equally in the profits and surplus remaining after all liabilities, including those to partners, are satisfied; and must contribute toward the losses, whether of capital or otherwise, sustained by the partnership according to his share in the profits.

(2) The partnership must indemnify every partner for payments made and personal liabilities reasonably in­curred by him in the ordinary and proper conduct of its business or for the preservation of its business or prop­erty.

(3) A partner who in aid of the partnership makes any payment or advance beyond the amount of capital that he agreed to contribute shall be paid interest from the date of the payment or advance.

(4) A partner shall receive interest on the capital contributed by him from the date when repayment should be made.

393

Ch.620 PARTNERSHIP LAWS F.S. 1987

(5) All partners have equal rights in the management and conduct of the partnership business.

(6) No partner is entitled to remuneration for acting in the partnership business, except that a surviving part­ner is entitled to reasonable compensation for his ser­vices in winding up the partnership affairs.

(7) No person can become a member of a partner­ship without the consent of all the partners.

(8} Any difference arising about ordinary matters connected with the partnership business may be decid­ed by a majority of the partners; but no act in contraven­tion of any agreement between the partners may be done rightfully without the consent of all the partners.

Hlstory.-s. 18, ch. 72-108.

620.65 Partnership books.-The partnership books shall be kept, subject to any agreement between the partners, at the principal place of business of the part­nership, and every partner shall have access to and may inspect and copy any of them at all times.

Hlstory.-s. 19, ch. 72-108.

620.655 Duty of partners to render information.­On demand partners shall render true and full informa­tion of all things affecting the partnership to any partner or the legal representative of any deceased partner or partner under legal disability.

History.-s. 20, ch. 72-108.

620.66 Partner accountable as a fiduciary.-(1) Every partner must account to the partnership

for any benefit, and hold as trustee for it any profits, de­rived by him without the consent of the other partners from any transaction connected with the formation, con­duct, or liquidation of the partnership or from any use by him of its property.

(2) This section applies also to the representatives of a deceased partner engaged in the liquidation of the affairs of the partnership as the personal representa­tives of the last surviving partner.

History.-s. 21, ch. 72-108.

620.665 Right to an account.-Any partner shall have the right to a formal account of partnership affairs:

(1) If he is wrongfully excluded from the partnership business or possession of its property by his copartners.

(2) If the right exists under the terms of an agree-ment.

(3) As provided by s. 620.66. (4) At any other reasonable time.

Hlstory.-s. 22, ch. 72-108.

620.67 Continuation of partnership beyond fixed term.-

(1) When a partnership for a fixed term or particular undertaking is continued after the termination of the term or undertaking without an express agreement, the rights and duties of the partners remain the same as they were at termination so far as is consistent with a partnership at will.

(2) A continuation of the business by the partners or such of them as habitually acted in it during the term without any settlement or liquidation of the partnership affairs is prima facie evidence of a continuation of the

partnership. Hlstory.-s. 23, ch. 72-108.

620.675 Extent of property rights of a partner.-The property rights of a partner are:

(1) His rights in specific partnership property; (2) His interest in the partnership; and (3) His right to participate in the management.

Hlstory.-s. 24, ch. 72-108.

620.68 Nature of a partner's right in specific part· nership property.-

(1) A partner is coowner with his partners of specific partnership property holding as a tenant in partnership.

(2) The incidents of this tenancy are such that: (a) Subject to the provisions of this part and to any

agreement between the partners, a partner has an equal right with his partners to possess specific partnership property for partnership purposes; but he has no right to possess the property for any other purpose without the consent of his partners.

(b) A partner's right in specific partnership property is not assignable except in connection with the assign­ment of rights of all the partners in the same property.

(c) A partner's right in specific partnership property is not subject to attachment or execution, except on a claim against the partnership. When partnership proper­ty is attached for a partnership debt, the partners, or any of them, or the representatives of a deceased partner, cannot claim any right under the homestead or exemp­tion laws.

(d) On the death of a partner his right in specific partnership property vests in the surviving partner or partners, except when the deceased was the last surviv­ing partner, his right in the property vests in his legal rep­resentative. The surviving partner or partners or the le­gal representative of the last surviving partner has no right to possess the partnership property except for a partnership purpose.

(e) A partner's right in specific partnership property is not subject to dower, curtesy, or allowances to wid­ows, heirs, or next of kin.

Hlstory.-s. 25, ch . 72-108.

620.685 Nature of partner's interest in the partner­ship.-A partner's interest in the partnership is his share of the profits and surplus. It is personal property.

History.-s. 26, ch. 72-108.

620.69 Assignment of partner's interest.-(1) A conveyance by a partner of his interest in the

partnership of itself does not dissolve the partnership, nor, as against the other partners in the absence of agreement, entitle the assignee to interfere in the man­agement or administration of the partnership business or affairs, to require any information or account of part­nership transactions, or to inspect the partnership books during the continuance of the partnership. It enti­tles the assignee to receive the profits to which the as­signing partner would otherwise be entitled in accord­ance with his contract.

(2) If the partnership is dissolved, the assignee is en­titled to receive his assignor's interest and may require an account from the date of the last account agreed to

394

F.S. 1987 PARTNERSHIP LAWS Ch.620

by all the partners. Hlatory.-s. 27. ch. 72-108.

620.695 Partner's interest subject to charging or· der.-

(1) On application to a court having jurisdiction by any judgment creditor of a partner, the court may charge the interest of the debtor partner with payment of the un­satisfied amount of the judgment with interest, and may then or later appoint a receiver of his share of the profits and of any other money due or to become due to him from the partnership, and make all other orders to take the actions that the debtor partner might have made or that the circumstances of the case may require.

(2) The partner's interest charged may be re­deemed at any time before foreclosure, or, in case of a sale being directed by the court, may be purchased without thereby causing a dissolution:

(a) With separate property by any one or more of the partners; or

(b) With partnership property by any one or more of the partners with the consent of all the partners whose interests are not charged or sold .

(3) Nothing in this part shall deprive a partner of any right under the exemption laws covering his interest in the partnership.

History.-s. 28. ch. 72-108.

620.70 "Dissolution" defined.-The "dissolution" of a partnership is the change in the relation of the partners caused by a partner ceasing to be associated in the car­rying on, as distinguished from the winding up, of the business.

History.-s. 29, ch. 72-108.

620.705 Partnership not terminated by dissolution. -On dissolution the partnership is not terminated , but continues until the winding up of partnership affairs is completed .

History.-s. 30, ch. 72-108.

620.71 Causes of dissolution.-Dissolution is caused:

( 1) Without violation of the agreement between the partners:

(a) By the termination of the definite term or particu­lar undertaking specified in the agreement,

(b) By the expressed decision of a partner when no definite term or particular undertaking is specified,

(c) By the express will of all the partners who have not assigned their interests or suffered them to be charged for their separate debts, either before or after the termination of any specified term or particular under­taking, or

(d) By the expulsion of a partner from the business bona fide in accordance with such a power conferred by the agreement between the partners;

(2) In contravention of the agreement between the partners when the circumstances do not permit a disso­lution under any other provision of this section by the ex­pressed decision of a partner at any time;

(3) By any event that makes it unlawful for the busi­ness of the partnership to be carried on or for the mem­bers to carry it on in partnership;

(4) By the death of any partner; (5) By the bankruptcy of a partner or the partner­

ship; (6) By judgment of court under s. 620.715.

Hlstory.-s. 31 , ch. 72-108.

620.715 Dissolution by decree of court.-The court shall adjudge a dissolution:

(1) On application by or for a partner when : (a) A partner has been declared a lunatic in a judicial

proceeding or is shown to be of unsound mind . (b) A partner becomes in any other way incapable

of performing his part of the partnership contract. (c) A partner has been guilty of conduct that tends

to affect prejudicially the carrying on of the business. (d) A partner willfully or persistently commits a

breach of the partnership agreement, or otherwise so conducts himself in matters relating to the partnership business that it is not reasonably practicable to carry on the business in partnership with him.

(e) The business of the partnership can only be car­ried on at a loss.

(f) Any ground under s. 620.71 is found to exist. (2) On the application of the purchaser of a partner's

interest under ss. 620.69 and 620.695: (a) After the termination of the specified term or par­

ticular undertaking. (b) At any time if the partnership was a partnership

at will when the interest was assigned or when the charging order was issued.

History.-s. 32, ch. 72-108.

620.72 General effect of dissolution on authority of partner.-Except as may be necessary to wind up part­nership affairs or to complete transactions begun but not then finished, dissolution terminates all authority of a partner to act for the partnership:

(1) With respect to the partners when the dissolu­tion is not by the act , bankruptcy, or death of a partner; or when the dissolution is by the act, bankruptcy, or death of a partner when s. 620.725 so requires.

(2) With respect to persons not partners, as de­clared in s. 620.73.

Hlstory.-s. 33, ch. 72-108.

620.725 Right of partner to contribution from co· partners after dissolution.-When the dissolution is caused by the act , death, or bankruptcy of a partner, each partner is liable to his copartners for his share of any liability created by a partner acting for the partner­ship as if the partnership had not been dissolved unless:

(1) The dissolution being by act of a partner, the partner acting for the partnership had knowledge of the dissolution , or

(2) The dissolution being by the death or bankruptcy of a partner, the partner acting for the partnership had knowledge or notice of the death or bankruptcy.

History.-s. 34, ch. 72-108.

620.73 Power of partner to bind partnership to third persons after dissolution.-

(1) After dissolution a partner can bind thfil partner­ship except as provided in subsection (3):

395

Ch.620 PARTNERSHIP LAWS F.S. 1987

(a) By an act appropriate for winding up partnership affairs or completing transactions unfinished at dissolu­tion;

(b) By a transaction that would bind the partnership if dissolution had not taken place, provided the other party to the transaction:

1. Had extended credit to the partnership before dissolution and had no knowledge or notice of the disso­lution; or

2. Though he had not extended credit, had never-theless known of the partnership before dissolution and, having no knowledge or notice of dissolution, the fact of dissolution had not been advertised in a newspaper of general circulation in the place or in each place, if more than one, at which the partnership business was regular­ly carried on.

(2) The liability of a partner under subsection (1 )(b) shall be satisfied out of partnership assets alone when before dissolution that partner had been:

(a) Unknown as a partner to the person with whom the contract is made; and

(b) So far unknown and inactive in partnership af­fairs that the business reputation of the partnership could not be said to have been in any degree due to his connection with it.

(3) The partnership is in no case bound by an act of a partner after dissolution:

(a) When the partnership is dissolved because it is unlawful to carry on the business, unless the act is ap­propriate for winding up partnership affairs;

(b) When the partner has become bankrupt ; or (c) When the partner has no authority to wind up

partnership affairs; except by a transaction with one who:

1 . Had extended credit to the partnership before dissolution and had no knowledge or notice of his want of authority; or

2. Had not extended credit to the partnership be-fore dissolution, and, having no knowledge or notice of his want of authority, the fact of his want of authority had not been advertised in the manner provided for advertis­ing the fact of dissolution in subsection (1 )(b)2.

(4) Nothing in this section shall affect the liability of a person under s. 620.635 who after dissolution repre­sents himself or consents to another representing him as a partner in a partnership engaged in carrying on business.

Hlatory.-s. 35, ch. 72-108.

620.735 Effect of dissolution on partner's existing liability.-

(1) The dissolution of the partnership of itself does not discharge the existing liability of any partner.

(2) A partner is discharged from any existing liability upon dissolution of the partnership by an agreement to that effect between himself, the partnership creditor and the person or partnership continuing the business. The agreement may be inferred from the course of dealing between the creditor having knowledge of the dissolu­tion and the person or partnership continuing the busi­ness.

(3) When a person agrees to assume the existing obligations of a dissolved partnership, the partners

whose obligations have been assumed shall be dis­charged from any liability to any creditor of the partner­ship who, knowing of the agreement, consents to a ma­terial alteration in the nature or time of payment of the obligations.

(4) The individual property of a deceased partner shall be liable for all obligations of the partnership in­curred while he was a partner but subject to the prior payment of his separate debts.

Hlatory.-s. 36, ch. 72-108.

620.74 Right to wind up.-Unless otherwise agreed the partners who have not wrongfully dissolved the part­nership or the legal representative of the last surviving partner, not bankrupt, has the right to wind up the part­nership affairs; but any partner, his legal representative or his assignee may obtain winding up by the court.

Hlatory.-s. 37, ch. 72-108.

620.745 Rights of partners to application of part­nership property.-

(1) When dissolution is caused in any way except in contravention of the partnership agreement, each part­ner as against his copartners and all persons claiming through them, unless otherwise agreed, may have the partnership property applied to discharge its liabilities and the surplus applied to pay in cash the net amount owing to the respective partners. If dissolution is caused by the bona fide expulsion of a partner under the part­nership agreement and if the expelled partner is dis­charged from all partnership liabilities, either by pay­ment or agreement under s. 620.735(2), he shall receive in cash only the net amount due him from the partner­ship.

(2) When dissolution is caused in contravention of the partnership agreement, the rights of the partners shall be as follows :

(a) Each partner who has not caused dissolution wrongfully shall have:

1. All the rights specified in subsection (1 ), and 2. The right to damages for breach of the agree­

ment against each partner who has caused the dissolu­tion wrongfully.

(b) If all the partners who have not caused the disso­lution wrongfully desire to continue the business in the same name, either by themselves or jointly with others, they do so during the agreed term for the partnership and for that purpose may possess the partnership prop­erty, if they secure the payment by bond approved by the court or pay the value of his interest in the partner­ship at the dissolution to a partner who has caused the dissolution wrongfully, less any damages recoverable under paragraph (a)2., and in like manner indemnify him against all present or future partnership liabilities.

(c) A partner who has caused the dissolution wrong­fully shall have:

1. If the business is not continued under the provi-sions of paragraph (b), all the rights of a partner under subsection (1 ), subject to paragraph (a)2.

2. If the business is continued under paragraph (b), the right , as against his copartners and all claiming through them in respect of their interests in the partner­ship, to have the value of his interest in the partnership, less any damages caused to his copartners by the dis-

396

F.S. 1987 PARTNERSHIP LAWS Ch.620

solution, ascertained and paid to him in cash, or the pay­ment secured by bond approved by the court , and to be released from all existing liabilities of the partnership; but in ascertaining the value of the partner's interest, the value of the good will of the business shall not be consid­ered.

Hlatory.-s. 38, ch. 72-108.

620.75 Rights when partnership is dissolved for fraud or misrepresentation.-When a partnership con­tract is rescinded on the ground of the fraud or misrepre­sentation of one of the parties to it , the party entitled to rescind is, without prejudice to any other right , entitled:

(1) To a lien on, or a right of retention of, the surplus of the partnership property after satisfying the partner­ship liabilities to third persons for any sum of money paid by him for the purchase of an interest in the partnership and for capital or advances contributed by him; and

(2) After all liabilities to third persons have been sat­isfied to stand in the place of the creditors of the partner­ship for payments made by him for partnership liabilities; and

(3) To be indemnified by the person guilty of the fraud or making the representation against all debts and liabilities of the partnership.

Hletory.-s. 39, ch. 72-108.

620.755 Rules for distribution.-ln settling ac­counts between the partners after dissolution , the fol­lowing rules shall be observed , subject to any agree­ment to the contrary:

(1) The assets of the partnership are: (a) The partnership property, (b) The contributions of the partners necessary for

the payment of all the liabilities specified in subsection (2) .

(2) The liabilities of the partnership shall rank in or­der of payment, as follows:

(a) Those owing to creditors other than partners, (b) Those owing to partners other than for capital

and profits, (c) Those owing to partners for capital, (d) Those owing to partners for profits. (3) The assets shall be applied in the order of their

declaration in subsection ( 1) to the satisfaction of the lia­bilities.

(4) As provided by s. 620.645(1 ), the partners shall contribute the amount necessary to satisfy the liabilities; but if any, but not all , of the partners are insolvent or, not being subject to process, refuse to contribute, the other partners shall contribute their share of the liabilities and, in the relative proportions in which they share the profits, the additional amount necessary to pay the liabilities.

(5) An assignee for the benefit of creditors or any person appointed by the court may enforce the contribu­tions specified in subsection (4) .

(6) Any partner or his legal representative may en­force the contributions specified in subsection (4) to the extent of the amount that he has paid in excess of his share of the liability.

(7) The individual property of a deceased partner shall be liable for the contributions specified in subsec­tion (4) .

(8) When partnership property and the individual properties of the partners are in possession of a court for distribution, partnership creditors shall have priority on partnership property and separate creditors on indi­vidual property, saving the rights of lien or secured cred­itors as heretofore provided.

(9) When a partner has become bankrupt or his es­tate is insolvent, the claims against his separate proper­ty shall rank in the following order:

(a) Those owing to separate creditors , (b) Those owing to partnership creditors , (c) Those owing to partners by way of contribution .

Hletory.-s. 40, ch. 72- 108.

620.76 Liability of persons continuing the business in certain cases.-

(1) When a new partner is admitted into an existing partnership, or a partner retires and assigns, or the rep­resentative of the deceased partner assigns, his rights in partnership property to two or more of the partners, or to one or more of the partners and one or more third persons, and the business is continued without liquida­tion of the partnership affairs, creditors of the first or dis­solved partnership are also creditors of the partnership continuing the business.

(2) When all but one partner retire and assign, or the representative of a deceased partner assigns , their rights in partnership property to the remaining partner who continues the business without liquidation of part­nership affairs , either alone or with others, creditors of the dissolved partnership are also creditors of the per­son or partnership continuing the business.

(3) When any partner retires or dies and the busi­ness of the dissolved partnership is continued as set forth in subsections (1) and (2) with the consent of the retired partners or the representative of the deceased partner, but without any assignment of his right in part­nership property, rights of creditors of the dissolved partnership and of the creditors of the person or partner­ship continuing the business shall be the same as if the assignment had been made.

(4) When all the partners or their representatives as­sign their rights in partnership property to one or more third persons who promise to pay the debts and who continue the business of the dissolved partnership, creditors of the dissolved partnership are also creditors of the person or partnership continuing the business.

(5) When any partner wrongfully causes a dissolu­tion and the remaining partners continue the business under the provisions of s. 620.745(2)(b), either alone or with others, and without liquidation of the partnership af­fairs , creditors of the dissolved partnership are also creditors of the person or partnership continuing the business.

(6) When a partner is expelled and the remaining partners continue the business, either alone or with oth­ers without liquidation of the partnership affairs, credi­tors of the dissolved partnership are also creditors of the person or partnership continuing the business.

(7) The liability of a third person becoming a partner in the partnership continuing the business under this section to the creditors of the dissolved partnership shall be satisfied out of partnership property only.

397

Ch.620 PARTNERSHIP LAWS F.S. 1987

(8) When the business of a partnership after dissolu­tion is continued under any conditions set forth in this section, the creditors of the dissolved partnership, as against the separate creditors of the retiring or de­ceased partner or the representative of the deceased partner, have a prior right to any claim of the retired part­ner or the representative of the deceased partner against the person or partnership continuing the busi­ness on account of the retired or deceased partner's in­terest in the dissolved partnership or on account of any consideration promised for the interest or for his right in partnership property.

(9) Nothing in this section shall modify any right of creditors to set aside an assignment on the ground of fraud .

(1 0) The use by the person or partnership continuing the business of the partnership name, or the name of a deceased partner as part of it of itself shall not make the individual property of the deceased partner liable for any debts contracted by the person or partnership.

History.-s. 41 , ch . 72- 108.

620.765 Rights of retiring partner or estate of de­ceased partner when the business is continued.­When a partner retires or dies and the business is con­tinued under any of the conditions set forth in s.

620.76(1), (2), (3), (5) , or (6) or s. 620.745(2)(b), without any settlement of accounts between him or his estate and the person or partnership continuing the business, unless otherwise agreed, he or his legal representative, as against the persons or partnership, may have the val­ue of his interest at the date of dissolution ascertained, and shall receive as an ordinary creditor an amount equal to the value of his interest in the dissolved partner­ship with interest or, at his option or that of his legal rep­resentative, instead of interest, the profits attributable to the use of his right in the property of the dissolved partnership; but the creditors of the dissolved partner­ship as against the separate creditors, or the represent­ative of the retired or deceased partner, shall have priori­ty on any claim arising under this section, as provided by s. 620.76(8).

Hlatory.-s. 42, ch. 72-108.

620.77 Accrual of actions.-The right to an account of his interest shall accrue to any partner or his legal rep­resentative as against the winding up partners or the surviving partners or the person or partnership continu­ing the business at the date of dissolution in the ab­sence of any agreement to the contrary.

Hiatory.-s. 43, ch. 72-108.

398

F.S. 1987 PROFESSIONAL SERVICE CORPORATIONS Ch. 621

CHAPTER 621

PROFESSIONAL SERVICE CORPORATIONS

621 .01 621.02 621 .03 621 .04 621 .05 621 .06 621 .07

621 .08

621.09 621.10

621.11 621 .12 621.13 621 .14 621 .15

Legislative intent. Short title. Definitions . Exemptions . Corporation organization. Rendition of professional services, limitations . Liability of officers, agents, employees, share-

holders, and corporation . Limitation on corporation 's business transac­

tions; investment of funds . Limitation on issuance and transfer of stock. Disqualification of shareholder, officer, agent,

or employee; forfeiture of charter . Alienation of shares, restrictions. Identification with shareholders. Applicability of chapter 607 . Construction of law. Applicability of chapter 67-590, Laws of Flori­

da.

621.01 Legislative intent-It is the legislative intent to provide for the incorporation of an individual or group of individuals to render the same professional service to the public for which such individuals are required by law to be licensed or to obtain other legal authorization .

History.-s. 1. ch. 61-64.

621.02 Short title.-This act may be cited as the "Professional Service Corporation Act."

History.- s. 2, ch. 61-64.

621.03 Definitions.-As used in this act the follow­ing words shall have the meaning indicated:

( 1) The term "professional service" means any type of personal service to the public which requires as a con­dition precedent to the rendering of such service the ob­taining of a license or other legal authorization and which prior to the passage of this act and by reason of law could not be performed by a corporation . By way of ex­ample and without limiting the generality thereof, the personal services which come within the provisions of this act are the personal services rendered by certified public accountants, public accountants, chiropractors, dentists , osteopaths , physicians and surgeons , doctors of medicine, doctors of dentistry, podiatrists, chiropo­dists, architects, veterinarians, attorneys at law, and life insurance agents.

(2) The term "professional corporation" means a cor­poration which is organized under this act for the sole and specific purpose of rendering professional service and which has as its shareholders only individuals who themselves are duly licensed or otherwise legally author­ized within this state to render the same professional service as the corporation .

History.-s. 3, ch. 61-64.

621.04 Exemptions.-This act shall not apply to any individuals or groups of individuals within this state who prior to the passage of this act were permitted to orga­nize a corporation and perform personal services to the

public by the means of a corporation, and this act shall not apply to any corporations organized by such individ­ual or group of individuals prior to the passage of this act ; provided , however, any such individual or group of individuals or any such corporation may bring them­selves and such corporation within the provisions of this act by amending the articles of incorporation in such a manner so as to be consistent with all the provisions of this act and by affirmatively stating in the amended arti­cles of incorporation that the shareholders have elected to bring the corporation within the provisions of this act.

History.-s. 4, ch. 61 - 64.

621.05 Corporation organization.-An individual or group of individuals duly licensed or otherwise legally authorized to render the same professional services within this state may organize and become a sharehold­er or shareholders of a professional corporation for pecu­niary profit under the provisions of chapter 607 for the sole and specific purpose of rendering the same and specific professional service.

History.- s. 5, ch. 61 -64: s. 10, ch. 79-9.

621.06 Rendition of professional services, limita­tions.-No corporation organized and incorporated un­der this act may render professional services except through its officers, employees, and agents who are duly licensed or otherwise legally authorized to render such professional services within this state; provided , howev­er, this provision shall not be interpreted to include in the term "employee," as used herein , clerks , secretaries, bookkeepers, technicians, and other assistants who are not usually and ordinarily considered by custom and practice to be rendering professional services to the public for which a license or other legal authorization is required; and provided further, that nothing contained in this act shall be interpreted to require that the right of an individual to be a shareholder of a corporation or­ganized under this act , or to organize such a corpora­tion, is dependent upon the present or future existence of an employment relationship between him and such corporation , or his present or future active participation in any capacity in the production of the income of such corporation or in the performance of the services ren­dered by such corporation.

History.-s. 6, ch. 61-64: s. 1, ch. 67-590.

621.07 Liability of officers, agents, employees, shareholders, and corporation.-Nothing contained in this act shall be interpreted to abolish, repeal , modify, restrict , or limit the law now in effect in this state applica­ble to the professional relationship and liabilities be­tween the person furnishing the professional services and the person receiving such professional service and to the standards for professional conduct ; provided, however, that any officer, agent, or employee of a corpo­ration organized under this act shall be personally liable and accountable only for negligent or wrongful acts or misconduct committed by him, or by any person under his direct supervision and control, while rendering pro-

399

Ch. 621 PROFESSIONAL SERVICE CORPORATIONS F.S. 1987

fessional service on behalf of the corporation to the per­son for whom such professional services were being rendered; and provided further that the personal liability of shareholders of a corporation organized under this act, in their capacity as shareholders of such corpora­tion, shall be no greater in any aspect than that of a shareholder-employee of a corporation organized under chapter 607 . The corporation shall be liable up to the full value of its property for any negligent or wrongful acts or misconduct committed by any of its officers, agents, or employees while they are engaged on behalf of the corporation in the rendering of professional services.

Hlstory.-s. 7, ch. 61-64; s. 2, ch. 67-590; s. 11 , ch. 79-9.

621.08 Limitation on corporation's business trans­actions; investment of funds.-No corporation orga­nized under this act shall engage in any business other than the rendering of the professional services for which it was specifically incorporated; provided, however, nothing in this act or in any other provisions of existing law applicable to corporations shall be interpreted to prohibit such corporation from investing its funds in real estate, mortgages, stocks, bonds, or any other type of investments, or from owning real or personal property necessary for the rendering of professional services.

Hlstory.-s. 8, ch. 61-64.

621.09 Limitation on issuance and transfer of stock.-No corporation organized under the provisions of this act may issue any of its capital stock to anyone other than an individual who is duly licensed or other­wise legally authorized to render the same specific pro­fessional services as those for which the corporation was incorporated. No shareholder of a corporation orga­nized under this act shall enter into a voting trust agree­ment or any other type agreement vesting another per­son with the authority to exercise the voting power of any or all of his stock.

Hlstory.-s. 9, ch. 61-64.

621.10 Disqualification of shareholder, officer, agent, or employee; forfeiture of charter.-lf any offi­cer, shareholder, agent, or employee of a corporation or­ganized under this chapter who has been rendering pro­fessional service to the public becomes legally disquali­fied to render such professional services within this state or accepts employment that, pursuant to existing law, places restrictions or limitations upon his continued rendering of such professional services, he shall sever all employment with , and financial interests in, such cor­poration forthwith. A corporation's failure to require com­pliance with this provision shall constitute a ground for the forfeiture of its articles of incorporation and its disso­lution. When a corporation 's failure to comply with this provision is brought to the attention of the Department of State, the department forthwith shall certify that fact to the Department of Legal Affairs for appropriate action to dissolve the corporation.

Hlstory.-s. 10, ch. 61-64; ss. 10, 11, 35, ch. 69-106; s. 1, ch. 69-288; s. 1, ch. 70-305; s. 1, ch. 70-439.

621.11 Alienation of shares, restrictions.-No shareholder of a corporation organized under this act may sell or transfer his shares in such corporation ex­cept to another individual who is eligible to be a share­holder of such corporation.

Hletory.-s. 11 , ch. 61-64; s. 3, ch . 67-590.

621.12 Identification with shareholders.-The cor­porate name of a corporation organized under this act may contain the last names of some or all of the share­holders and may contain the last names of retired or de­ceased former shareholders of the corporation or of a predecessor corporation or partnership. The corporate name shall also contain the word "chartered" or "profes­sional association" or the abbreviation "P.A." The use of the word "company," "corporation," or "incorporated" or any other word, abbreviation, affix, or prefix indicating that it is a corporation in the corporate name of a corpo­ration organized under this act, other than the word "chartered" or "professional association," or the abbrevia­tion "P.A. ," is specifically prohibited. It shall be permissi­ble, however, for the corporation to render professional services and to exercise its authorized powers under a name which is identical to its corporate name except that the words "chartered" or "professional association" or the abbreviation "P.A." is omitted, provided that the corporation has first registered the name to be so used in the manner required for the registration of fictitious names.

Hletory.-s. 12, ch. 61-64; s. 1, ch. 77-134; s. 1, ch. 87-41 .

621.13 Applicability of chapter 607.-Chapter 607 is applicable to a corporation organized pursuant to this act except to the extent that any of the provisions of this act are interpreted to be in conflict with the provisions of chapter 607, and in such event the provisions and sections of this act shall take precedence with respect to a corporation organized pursuant to the provisions of this act. A professional corporation organized under this act shall consolidate or merge only with another domes­tic professional corporation organized under this act to render the same specific professional service, and a merger or consolidation with any foreign corporation is prohibited . A professional corporation heretofore or hereafter organized under this act may change its busi­ness purpose from the rendering of professional service to provide for any other lawful purpose by amending its certificate of incorporation in the manner required for an original incorporation under chapter 607. However, such an amendment, when filed with and accepted by the De­partment of State, shall remove such corporation from the provisions of chapter 621 including, but not limited to, the right to practice a profession. A change of busi­ness purpose shall not have any effect on the continued existence of the corporation and the limitations of s. 607.177(1) shall not preclude such an amendment.

Hletory.-s. 13, ch . 61-64; ss. 10, 35, ch. 69-106; s. 2, ch . 69-288; s. 210, ch . 77-104.

621.14 Construction of law.-The provisions of this act shall not be construed as repealing, modifying, or re­stricting the applicable provisions of law relating to in· corporations, sales of securities, or regulating the sever­al professions enumerated in this act except insofar as such laws conflict with the provisions of this act.

Hlstory.-s. 15, ch . 61-64.

621.15 Applicability of chapter 67-590, Laws of Florida.-The amendments to ss. 621 .06, 621 .07, and 621.11 by chapter 67-590, Laws of Florida, shall apply to all corporations heretofore or hereafter organized un­der this act.

Hletory.-s. 4, ch. 67-590.

400