Krause v. TEXTRON FINANCIAL CORP.
59 So. 3d 1085
| Fla. | 2011Background
- Petitioners Krause and Bautsch sought relief in Florida state court after bankruptcy-related proceedings involving Twin Eagles Golf and Textron.
- Textron financed Twin Eagles and held a security interest in resale proceeds from memberships.
- Appellants resigned memberships in 1999; resale proceeds were paid to Textron, reducing amounts due to Appellants.
- Twin Eagles filed Chapter 11; bankruptcy court later determined Textron had a claim fully satisfied and dismissed the constructive trust claim for lack of jurisdiction.
- Petitioners filed suit in Collier County circuit court in 2005; the trial court and Second District held the Florida statute of limitations barred and tolling did not apply.
- Florida Supreme Court granted review to resolve whether 28 U.S.C. § 1367(d) tolls the Florida statute of limitations when the related federal jurisdiction issue is lack of jurisdiction under bankruptcy court’s subject matter.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §1367(d) tolls the Florida statute when a state claim is dismissed for lack of federal bankruptcy jurisdiction. | Krause contends tolling does not apply. | Textron contends tolling does not apply. | Tolling applies under §1367(d). |
| Whether Krause conflicts with Scarfo v. Ginsberg and thus warrants Supreme Court review. | Krause conflicts with Scarfo. | Scarfo is distinguishable. | No express and direct conflict; Florida Supreme Court adopts Scarfo reasoning. |
Key Cases Cited
- Krause v. Textron Fin. Corp., 10 So.3d 208 (Fla. 2d DCA 2009) ( Second District held tolling did not apply; related-to issue central to decision)
- Scarfo v. Ginsberg, 817 So.2d 919 (Fla. 4th DCA 2002) (tolling applies despite dismissal for lack of federal jurisdiction)
- Blinn v. Fla. Dep’t of Transp., 781 So.2d 1103 (Fla. 1st DCA 2000) (tolling applies even when federal case is voluntarily dismissed)