Thornton v. Holloway
| Docket Number: | 2009-CA-01262-COA | |
| Court of Appeals: |
Opinion Link Opinion Date: 11-23-2010 Opinion Author: Barnes, J. Holding: Reversed and rendered. |
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| Additional Case Information: |
Topic: Writ of garnishment - Interpleader - Insurance policy proceeds Judge(s) Concurring: King, C.J., Lee and Myers, P.JJ., Irving, Griffis, Ishee, Roberts and Maxwell, JJ. Non Participating Judge(s): Carlton, J. Procedural History: Bench Trial Nature of the Case: CIVIL - OTHER |
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| Trial Court: |
Date of Trial Judgment: 06-13-2006 Appealed from: MONROE COUNTY CHANCERY COURT Judge: Talmadge Littlejohn Disposition: JUDGMENT RENDERED IN FAVOR OF CHARLES HOLLOWAY Case Number: 2005-144-48-L |
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| Party Name: | Attorney Name: | |||
| Appellant: | Richard Thornton |
CARTER DOBBS JR. |
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| Appellee: | Charles D. Holloway | NO BRIEF FILED |
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Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Writ of garnishment - Interpleader - Insurance policy proceeds |
| Summary of the Facts: | Richard Thornton instituted action for Charles Holloway’s failure to repair and restore Thornton’s 1968 Chevrolet truck. The chancery court entered a default judgment against Holloway on November 13, 2003, ordering Holloway to complete the repair and restoration of the truck and to return the truck to Thornton within thirty days. The judgment also stated that, if Holloway failed to comply, then he must return the truck intact, reimburse Thornton his payment of $7,378, and pay $2,500 in punitive damages. Holloway did not repair and/or restore the truck, nor did he return the truck to Thornton and pay the fees. Thornton filed a Complaint for Citation for Contempt. The chancery court entered another order on August 24, 2004, holding Holloway in contempt and requiring him to pay $2,500 for Thornton’s attorney’s fees, plus court costs of $150. These fees were in addition to the $9,878 already owed from the November 2003 order. However, no payments were ever made by Holloway. On March 16, 2005, Amory Federal Savings and Loan Association filed a complaint for an interpleader, seeking to determine ownership of $15,598.56, which the bank held. These funds were a result of a previous land transaction between Holloway and John Kendall, the named defendants in the interpleader action. In March 1995, Kendall had purchased land in Monroe County, using a loan from Amory Federal. The loan required Kendall to maintain fire insurance. When Kendall failed to comply with the requirement, Amory Federal purchased the fire insurance and charged the premium to Kendall’s account as authorized by the loan agreement. In 1999, Kendall conveyed the property to Holloway, providing that Holloway would make the payments to Amory Federal. The house subsequently was destroyed by fire, and Amory Federal was paid $35,000 under the fire insurance policy. After paying off the remaining mortgage debt, $15,598.56 remained. Thornton filed a writ of garnishment against Amory Federal on March 18, 2005, in connection with his August 2004 judgment. After Amory Federal filed an answer to the writ of garnishment claiming that the proper party to the funds had yet to be determined, Thornton filed an answer in the nature of an interpleader and a counter-complaint, stating that his writ of garnishment constitutes a first lien upon the interplead funds and that Holloway owed him $12,588 (the original $12,528 plus a $60 enrollment fee and garnishment costs). The chancery court, nunc pro tunc to the June 6, 2005 hearing, granted relief to Amory Federal, allowing it to interplead its claims to the funds and releasing it from any claims by Thornton or Holloway. The funds were ordered to be held by the chancery court. Meanwhile, Thornton had filed another writ of garnishment against the Monroe County Chancery Clerk’s office, the custodian of the insurance funds. The chancery clerk’s office filed an answer disclaiming any indebtedness to Thornton. During the course of these proceedings, Holloway entered bankruptcy. Upon agreement among the parties and the bankruptcy trustee, the United States Bankruptcy Court for the Northern District of Mississippi entered an order granting leave from an automatic stay, allowing the chancery court to proceed with the cause. Holloway argued at the May 2006 hearing that the garnishment action was premature. A motion for partial judgment on the pleadings was also filed by Thornton, seeking a determination by the chancery court that the funds be adjudged the property of Holloway, in order that they may be subject to Thornton’s writs of garnishment. Holloway, in his answer, contended that Thornton lacked standing to bring the motion. The chancery court ordered the funds to be paid to Holloway. The final judgment was “entered without prejudice to the Defendant, Richard Thornton, to pursue whatever writs of garnishment he may desire to proceed[.]” Thomas appeals. |
| Summary of Opinion Analysis: | Holloway has not filed an appellate brief. The appellate court may take the appellee’s failure to file a brief as a confession of error and reverse. However, if the record can be conveniently examined and such examination reveals a sound and unmistakable basis or ground upon which the judgment may be safely affirmed, the Court may disregard the appellee’s error and affirm. In this case, the Court cannot find that the chancery court provided a sound and unmistakable basis that would excuse Holloway’s confession of error. Insurance policy proceeds are properly the subject of garnishment. Amory Federal actually purchased an insurance policy insuring the interest of Holloway in this property, and Amory Federal disclaimed any ownership in the surplus funds. Although the chancellor in this case claimed that the funds were not vested in Holloway until July 2006, Kendall, the only other defendant in the initial interpleader action, had no vested interest in the funds by virtue of the default judgment entered against him. As the chancellor said, Holloway became the recipient of the entitlement owner of these funds by default. Thus, when Kendall no longer had any claim to the funds and the funds were handed over to the registry of the court by virtue of the August 1, 2005, nunc pro tunc order, only Thornton and Holloway remained as claimants to the insurance surplus funds. As a result, these funds were subject to Thornton’s second writ of garnishment issued to the Monroe County Chancery Clerk. |
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