Hawkins v. Ford Motor Company , 135 F.3d 1443 ( 1998 )

PUBLISH
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
_______________
No. 96-2306
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D. C. Docket No. 95-55-CIV-T-21-E
DWAYNE HAWKINS,
MILLARD G. RIPLEY,
Plaintiffs-Appellants,
versus
FORD MOTOR COMPANY,
Defendant-Appellee.
______________________________
Appeal from the United States District Court
for the Middle District of Florida
______________________________
(March 2, 1998)
Before BIRCH, Circuit Judge, FAY, Senior Circuit Judge, and
COHILL*, Senior District Judge.
*
Honorable Maurice B. Cohill, Jr., Senior U.S. District Judge
for the Western District of Pennsylvania, sitting by designation.
PER CURIAM:
CERTIFICATION FROM THE UNITED
STATES COURT OF APPEALS FOR THE
ELEVENTH CIRCUIT TO THE SUPREME COURT
OF FLORIDA PURSUANT TO ARTICLE 5,
SECTION 3(b)(6) OF THE FLORIDA
CONSTITUTION.
TO THE SUPREME COURT OF FLORIDA AND
ITS HONORABLE JUSTICES:
This case comes to the United States
Court of Appeals for the Eleventh Circuit
on appeal from the United States District
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Court for the Middle District of Florida.
Because this case presents unresolved questions of Florida law that
are determinative of this appeal, we defer our decision pending
certification of several issues posed by the parties to the Supreme
Court of Florida. See Gossard v. Adia Services, Inc., 120 F.3d
1
1229, 1230 (11th Cir. 1997). Therefore, we certify
the following question of law, based on the
background recited below, to the Supreme
Court of Florida for instruction.
I. FACTS
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The present case was consolidated on appeal with Morse v.
Ford Motor Co., Case No. 96-3633, also on appeal from the Middle
District of Florida. With respect to the issues of law central to
this case and on substantially similar facts, the district court
judges came to opposite conclusions. Due to a settlement agreement
between the parties, the appeal in Morse was dismissed prior to
this court's certification.
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This case arose from the attempt of
plaintiffs, Dwayne Hawkins and Millard G.
Ripley, to purchase all the stock from the
owners of a company, Wilson Davis Ford,
Inc., which operated as a motor vehicle
dealer under a franchise agreement with
Ford Motor Company ("Ford"), a motor
vehicle manufacturer. The sellers of this
stock gave notice of an intent to
transfer ownership pursuant to Fla. Stat.
§ 320.643, and Wilson Davis Ford, Inc. gave
notice of an intent to change its
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executive management pursuant to Fla.
Stat. § 320.644, from the sellers, Davis and
Bodiford, to the proposed purchasers of the
stock, Hawkins and Ripley. Ford responded
to this notice by filing a verified
complaint with the Florida Department of
Highway Safety and Motor Vehicles
("DHSMV") opposing both the proposed
transfer under section 320.643 and the
proposed change of management under
section 320.644.
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With respect to its opposition to the
proposed transfer of stock, Ford's
complaint alleged several deficiencies in
the financial qualifications of Hawkins
and Ripley and several performance
deficiencies of a Lincoln-Mercury
dealership in which Hawkins had an
ownership interest; these deficiencies,
according to Ford, rendered Hawkins
ineligible to meet Ford's reasonable
standards for executive management.
With respect to the proposed change of
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management, Ford's complaint alleged
these same deficiencies.
Following the filing of Ford's complaint
in the DHSMV, the contract to sell the stock
was terminated and the administrative
proceeding was dismissed as moot.
Plaintiffs subsequently brought this action
in federal district court and alleged, inter
alia, that Ford had violated Fla. Stat. §
320.643, in opposing the transfer of equity
to Hawkins and Ripley by means of a
complaint that was facially deficient.
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II. CONTENTIONS
Hawkins and Ripley submit that by its
express provisions, notwithstanding the
terms of a franchise agreement, Fla. Stat.
§ 320.643(2)(a) governs the prospective
transfer of shares in a motor vehicle
dealership. Under this section, according to
the plaintiffs, Ford could object to such a
transfer only on the basis that the
proposed transferee was not of good moral
character. Ford's verified complaint did not
allege that either Hawkins or Ripley was
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not of good moral character. Consequently,
because Ford's complaint did not oppose the
transfer on grounds permitted by section
320.643(2)(a), Ford's complaint was facially
insufficient and Ford's opposition was in
violation of the statute. Ford argues
that in the case of a proposed complete
transfer of equity interest leading also to
a change of executive management, the
practical effect of such a transfer will be
the transfer of the franchise agreement.
Ford suggests that the Florida Dealer Act
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read as a whole, giving full effect to all
statutory provisions, permits
consideration of business qualifications as
well as moral character of a proposed
transferee where the proposal at issue is
to transfer 100% of the stock to a third
party. Ford further urges that a proposed
transfer of a franchise agreement is
regulated by the terms of Fla. Stat. §
320.643(1), under which a manufacturer
may object to a proposed transfer on
grounds that the transferee is not
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financially qualified or does not meet a
manufacturer's uniformly applied
reasonable standards or qualifications
with respect to executive management.
Consequently, Ford contends that it
properly could object to the management
experience and financial qualifications
of Hawkins and Ripley, as it did in its
verified complaint to the DHSMV.
In the trial court in this case, the
district court agreed with Ford and held as
a matter of law that "when transfer of
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100% of stock is contemplated, the
provisions regarding transfer of a
franchise agreement and change in
executive management control should
apply." The district court reached the
opposite legal conclusion with respect to
Morse, however, and determined that only
section 320.643(2)(a) applies to the
proposed transfer of 100% of the stock and,
as a result, that only moral character may
be considered as grounds for an objection
to such a transfer.
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III. QUESTION TO BE CERTIFIED
Does Fla. Stat. § 320.643(2)(a) provide
the exclusive basis for objection by a
motor vehicle manufacturer to the
proposed transfer of all the equity in
interest in a motor vehicle dealership?
Our statement of the question to be certified is intended as a
guide and is not meant to restrict the scope of inquiry by the
Supreme Court of Florida. The entire record of this case, together
with copies of the briefs, shall be transmitted to the court.
QUESTION CERTIFIED.
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