Opinion
NO. 2011-CA-002138-MR
06-07-2013
ELMO GREER & SONS, INC.; AND ELMO GREER & SONS, LLC APPELLANTS v. CITIZENS BANK, INC. APPELLEE
BRIEFS FOR APPELLANT: David B. Blandford Jeremy J. Beck Louisville, Kentucky BRIEF FOR APPELLEE: Keith A. Nagle Middlesboro, Kentucky
NOT TO BE PUBLISHED
APPEAL FROM BELL CIRCUIT COURT
HONORABLE ROBERT COSTANZO, JUDGE
ACTION NO. 11-CI-00346
OPINION
REVERSING AND REMANDING
BEFORE: DIXON, MOORE AND TAYLOR, JUDGES. DIXON, JUDGE: Appellants, Elmo Greer & Son, Inc. and Elmo Greer & Sons, LLC, appeal from an order of the Bell Circuit Court granting full faith and credit to an amended judgment of a Tennessee Court thereby authorizing enforcement of the judgment in Kentucky by Appellee, Citizens Bank, Inc. Because we conclude that the Tennessee Court was without jurisdiction to enter the amended judgment, the same must be considered void in Kentucky. Accordingly, this matter is remanded to the Bell Circuit Court for an order of dismissal.
In 2009, Citizens Bank filed suit in Claiborne County, Tennessee, against Elmo Greer & Sons, Inc. ("Greer, Inc.") for a returned check from one of Greer, Inc.'s customers. Summons was duly issued to the registered agent for Greer, Inc. On April 28, 2010, after Greer Inc. failed to respond, the Tennessee court entered a default judgment in favor of Citizens Bank in the amount of $15,523.67.
Subsequently, on June 11, 2010, the Tennessee court entered an amendment judgment, modifying the original judgment against Greer, Inc. "to include also Elmo Greer & Sons, LLC ["Greer, LLC"] in the amount of $15,523.67 plus court costs." On August 11, 2011, Citizens Bank proceeded to register the June amended judgment in Kentucky pursuant to Kentucky's Uniform Enforcement of Judgment Act, Kentucky Revised Statutes (KRS) 426.960. The Tennessee Judgment was filed in the Bell Circuit Court as the instant action, Citizens Bank v. Elmo Greer & Sons Inc. and Elmo Greer & Sons, LCC, 11-CI-00346.
On August 30, 2011, Greer, Inc. and Greer, LLC filed a motion to dismiss, arguing that Citizens Bank's complaint in the Tennessee action only named Greer, Inc., which had been inactive since 1999. Further, Citizens Bank did not file an amended complaint in Tennessee to name Greer, LLC as a party and, as a result, service of process was never perfected on that entity. Finally, Greer, Inc. and Greer, LLC argued that the amended judgment was void as it was entered in violation of Tennessee Civil Rule 59.04, and was thus not entitled to enforcement in Kentucky. Citizens Bank responded that Greer, Inc. and Greer, LLC were essentially one and the same, and that their "arguments about the Tennessee procedure for amending the judgment would have been better heard in Tennessee . . . ."
On October 31, 2011, the circuit court entered an order ruling:
The Court finds and concludes Elmo Greer & Sons, Inc. and Elmo Greer & Sons, LLC are, for all intents and purposes, one and the same entity. These entities merged in 1999; they share the same offices and agent; and the LLC endorsed and deposited a check payable to the corporation in the sum of $15,523.67, which is the check that is the subject of the Tennessee action being enforced herein. Summons in the Tennessee action was duly issued to and served upon the appropriate agent . . .Greer, Inc. and Greer, LLC thereafter appealed to this Court.
The Tennessee judgment is valid and enforceable in all respects against both Elmo Greer & Sons, Inc. and Elmo Greer & Sons, LLC.
On appeal, Greer, Inc. and Greer, LLC argue that the amended Tennessee judgment is void and thus not entitled to full faith and credit in Kentucky. Greer, Inc. and Greer, LLC also contend, as they did below, that Citizens Bank neither filed an amended complaint naming Greer, LLC nor offered any proof that the LLC was properly served in the Tennessee action. Both entities note that simply because they share the same agent for service of process does not necessarily mean that both entities were served simultaneously.
The law in Kentucky is that a sister state's judgment is entitled to full faith and credit if the judgment is valid under that state's own laws. Sunrise Turquoise, Inc. v. Chemical Design Company, Inc., 899 S.W.2d 856, 857-858 (Ky. App. 1995). As such, the question before us is whether the default judgment as amended is valid in Tennessee. We must conclude that it is not.
Tennessee Civil Rule 59.04 provides that "[a] motion to alter or amend a judgment shall be filed and served within thirty (30) days after entry of the judgment." As in Kentucky, if a post-trial motion is not timely, the trial court lacks jurisdiction to rule on the motion. See Binkley v. Medling, 117 S.W.3d 252, 255 (Tenn. 2003). The record indicates that the original Tennessee default judgment was entered on April 28, 2010. Entry of the amended judgment was on June 11, 2010, which was clearly outside of the thirty-day window for amendment of the April judgment. Accordingly, because the Tennessee court was without jurisdiction to enter the amended judgment, a Kentucky Court cannot afford it full faith and credit.
Tennessee law does provide that when a party files a timely motion to alter or amend a judgment, the trial court retains jurisdiction over the matter until it enters an order granting or denying the motion. Trundle v. Park, 210 S.W.3d 575 (Tenn. Ct. App. 2006). However, Citizens Bank has never disputed Greer Inc. and Greer, LLC's claim that its motion was filed after the expiration of the thirty-day time period.
Interestingly, Citizens Bank has never addressed the jurisdictional defect of the amended judgment. In the trial court, Citizens Bank erroneously argued that any issue of the judgment's validity should have been raised in the Tennessee Court. Such is not the law in Kentucky. "It is well-established that the issue of subject matter jurisdiction can be raised at any time, even sua sponte, as it cannot be acquired by waiver, consent, or estoppel." Gossett v. Kelley, 362 S.W.3d 379, 380 (Ky. App. 2012) (quoting Doe v. Golden & Walters, PLLC, 173 S.W.3d 260, 270 (Ky. App. 2005) (footnotes omitted)). See also Cox v. Cox, 170 S.W.3d 389 (Ky. 2005).
Finally, Citizens Bank has asserted for the first time on appeal that the Tennessee court had the authority to amend the judgment under Tennessee Rules of civil procedure 60.01 or 60.02 to correct a clerical mistake. As Citizens Bank failed to present this argument to the lower court, it is not properly preserved for appellate review. It is well settled that "a question not raised or adjudicated in the court below cannot be considered when raised for the first time in this court." Flag Drilling Co., Inc. v. Erco, Inc., 156 S.W.3d 762, 767-768 (Ky. App. 2005) (quoting Combs v. Knott County Fiscal Court, 283 Ky. 456, 141 S.W.2d 859, 860 (1940)). Notwithstanding, whether the amendment adding Greer LLC to the judgment constituted the correction of a clerical error under Tennessee law is not a determination properly made by this or any other Kentucky court.
Because we are compelled to conclude that the Tennessee amended judgment was procedurally void, we need not address the parties' arguments as to whether Greer, Inc. and Greer, LLC are, in fact, one and the same for the purposes of determining proper party and service of process issues.
For the reasons set forth herein, this matter is remanded to the Bell Circuit Court for entry of an order dismissing the instant action.
ALL CONCUR. BRIEFS FOR APPELLANT: David B. Blandford
Jeremy J. Beck
Louisville, Kentucky
BRIEF FOR APPELLEE: Keith A. Nagle
Middlesboro, Kentucky