Burshan v. NATIONAL UNION FIRE INS. COMPANY OF PITTSBURGH, PA.
| Citation | 805 So.2d 835 |
| Decision Date | 08 August 2001 |
| Docket Number | No. 4D00-2909.,4D00-2909. |
| Parties | Khalil BURSHAN, M.D., and Rosita Burshan, his wife, Appellants, v. NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA., a foreign corporation authorized to do business in the state of Florida, Appellee. |
| Court | Court of Appeal of Florida (US) |
Russell D. Kaplan of Russell D. Kaplan, P.A., Fort Lauderdale, for appellants.
Peter V. Fullerton, and Charles M-P George of Carlton, Fields, Ward, Emmanuel, Smith & Cutler, P.A., Miami, for appellee.
The main issue in this case is whether Florida's statute of limitations barred a garnishment proceeding in a Florida federal court, when the writ was issued over 11 years after the underlying federal judgment. We hold that the statute did not foreclose the garnishment.
On November 17, 1987, National Union Fire Insurance Company of Pittsburgh obtained a $74,126.54 judgment against Khalil Burshan in the United States District Court for the Southern District of New York.
On July 29, 1993, National Union registered the 1987 judgment in the United States District Court for the Southern District of Florida. National Union re-registered the judgment in the Southern District on November 10, 1998.
Upon National Union's motion, the clerk of the federal district court issued a writ of garnishment on February 16, 1999. The writ directed NationsBank, N.A. to answer whether it held tangible or intangible personal property of the judgment debtor, Khalil Burshan. NationsBank filed its answer and, in addition, froze three accounts: the "Dr. Khalil Burshan Wage Account," containing $30,069.22, and two accounts titled "Rosita Burshan ITF Khalil Burshan" holding a total of $9,895.44.
Burshan filed a defensive motion seeking (1) dissolution of the writ of garnishment, (2) a protective order barring post-judgment discovery, and (3) relief from judgment pursuant to Federal Rule of Civil Procedure 60(b).
The federal district court granted the motion in full. The court concluded that because a garnishment proceeding was an "action on a judgment" within the meaning of section 95.11(2)(a), Florida Statutes (2000), the Florida five year statute of limitations barred the 1999 garnishment, begun over 11 years after the issuance of the 1987 judgment. Relying on Balfour Beatty Bahamas, Ltd. v. Bush, 170 F.3d 1048 (11th Cir.1999), the district court held that under section 95.11(2)(a), National Union was "required to commence an action on the New York federal judgment within five years" after the 1987 entry of that judgment.
The federal judge observed that National Union had "waited more than five years and eight months to register the federal New York judgment on July 29, 1993." This language suggests that the district court found that the act of registration was an "action on a judgment" under section 95.11(2)(a).
On July 21, 1999, National Union appealed the district court's ruling to the Eleventh Circuit Court of Appeals. That court dismissed the appeal for want of prosecution in November, 1999.
On December 1, 1999, Khalil Burshan and his wife Rosita filed a seven count complaint in state court seeking damages arising from the federal court garnishment. National Union filed a lengthy motion to dismiss. The heart of its argument was that the writ of garnishment had been properly issued. The Burshans countered that collateral estoppel or res judicata barred re-litigation of the propriety of the writ of garnishment.
On June 12, 2000, the circuit court granted National Union's motion to dismiss with prejudice. The judge concluded that the federal district court had erred in its 1999 dismissal of the garnishment proceeding.
Under section 55.10, Florida Statutes (2000), a judgment becomes a lien on real property in a county when a certified copy of it is recorded in the public records of that county.1 A judgment so recorded "shall be a lien for a period of 7 years from the date of the recording." § 55.10(1), Fla. Stat. (2000). The judgment lien may be extended for a 10 year period by rerecording it pursuant to section 55.10(2).2 No section 55.10 judgment lien may extend "beyond the period provided for in" section 55.081, which is "20 years from the date of the entry of such judgment, order, or decree." §§ 55.10(3), 55.081, Fla. Stat. (2000).
Execution is a final process to enforce a judgment. Fla. R. Civ. P. 1.570(a). "When issued, an execution is valid and effective during the life of the judgment or decree on which it is issued." § 56.021, Fla. Stat. (2000); Fla. R. Civ. P. 1.550(a). An execution is thus subject to the time limit of section 55.081; an "execution may be issued during the 20 year life of the judgment on which it is based." HENRY P. TRAWICK, JR., FLORIDA PRACTICE AND PROCEDURE § 27-1 (2000). An execution may be levied against various forms of property, such as lands, goods, chattels, equities of redemption in real and personal property, and stock in corporations. § 56.061, Fla. Stat. (2000). The lien of an execution attaches to personal property when the execution is delivered to the sheriff; the date of "delivery to the sheriff establishes the priority of execution liens for levy, sale and collection." TRAWICK, FLORIDA PRACTICE AND PROCEDURE § 27-1 (2000).
Like execution, a writ of garnishment is another type of final process to enforce a judgment. See Fla. R. Civ. P. 1.570(a). A judgment holder may obtain issuance of a garnishment writ by filing a motion "stating the amount of the judgment and that movant does not believe that defendant has in his or her possession visible property on which a levy can be made sufficient to satisfy the judgment." § 77.03, Fla. Stat. (2000).
In this case, National Union registered its judgment from the Southern District of New York with the Southern District of Florida. Under 28 U.S.C.A. § 1963 (2000), when a judgment is so registered, it "shall have the same effect as a judgment of the district court of the district where registered and may be enforced in like manner." Registration thus gave the New York judgment the same effect as a judgment from the Southern District of Florida.
A judgment of a federal court sitting in Florida is a lien on property to the same extent as a judgment of a Florida court. See B.A. Lott, Inc. v. Padgett, 153 Fla. 304, 306, 14 So.2d 667, 668 (1943). 28 U.S.C.A. § 1962 (2000) provides:
Every judgment rendered by a district court within a State shall be a lien on the property located in such State in the same manner, to the same extent and under the same conditions as a judgment of a court of general jurisdiction in such State, and shall cease to be a lien in the same manner and time.
Thus, like a Florida judgment, a federal judgment becomes a lien on Florida property when it is recorded in a county's public records. 28 U.S.C. § 1962 provides that when state law requires a state judgment to be recorded in "a particular manner" before a judgment lien attaches, such a recording requirement applies to federal judgments only if a state law "authorizes" the recording of a judgment of a United States court. Section 28.222(3)(c), Florida Statutes (2000), authorizes a clerk of the circuit court to record a judgment entered "by a United States court having jurisdiction in this state." See TRAWICK, FLORIDA PRACTICE AND PROCEDURE § 25-11 (2000).
A judgment creditor's use of process to enforce its federal judgment is controlled "by the practice and procedure of the state in which the district court is held...." Fed.R.Civ.P. 69(a). Garnishments and executions in a Florida federal court are thus subject to the practices and procedures of chapters 56 and 77, Florida Statutes (2000), respectively. The statute of limitations at section 95.11, Florida Statutes (2000), is also a matter of "practice and procedure" that the federal court must apply. See Balfour Beatty Bahamas, 170 F.3d at 1050.
Crucial to this case is the wording of subsections 95.11(1) and (2), which provide:
(Italics supplied).
Since the nineteenth century, the phrase "action on a judgment" in the statute has had a precise meaning as a common law cause of action. The federal courts have interpreted the words broadly, resulting in too wide an application of the statute of limitations. The federal cases relied on Kiesel v. Graham, 388 So.2d 594 (Fla. 1st DCA 1980), where the change in the term's interpretation unfolded as an afterthought, without any recognition of what the phrase meant in early versions of the statute of limitations. Under a correct reading of the statute, neither the garnishment proceeding, nor the registration of the New York judgment under 28 U.S.C.A. § 1963 was an "action on a judgment" within the meaning of section 95.11(2).
Earlier versions of the statute of limitations made use of a phrase synonymous with "action on a judgment." In 1872, the legislature enacted chapter 1869, Laws of Florida; section 10 provided that an "action upon a judgment" had to be commenced "[w]ithin twenty years." Slaughter v. Tyler, 126 Fla. 515, 520, 171 So. 320, 322 (1936) (); see Coe v. Finlayson, 41 Fla. 169, 26 So. 704, 707 (1899). A later version of the statute of limitations, section 2939, Revised General Statutes of...
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