Ex parte Full Circle Distribution, LLC

• Decision Date: 05 December 2003
• Citation: 883 So.2d 638
• Parties: Ex parte FULL CIRCLE DISTRIBUTION, L.L.C. (In re Full Circle Distribution, L.L.C. v. Seco Aviation, Inc., and Anthony Aviation Center, Inc.).
• Court: Alabama Supreme Court

883 So.2d 638

Ex parte FULL CIRCLE DISTRIBUTION, L.L.C.

(In re Full Circle Distribution, L.L.C. v. Seco Aviation, Inc., and Anthony Aviation Center, Inc.).

1021631.

Supreme Court of Alabama.

December 5, 2003.

Joshua B. Sullivan and Christie D. Knowles of Henslee, Robertson, Strawn & Knowles, L.L.C., Gadsden, for petitioner.

E. Berton Spence and Carey Bennett McRae of Adams & Reese/Lange Simpson, LLP, Birmingham; and James D. Pruett of Pruett & Waldrup, LLC, Gadsden, for respondents.

LYONS, Justice.

Full Circle Distribution, L.L.C., the plaintiff in an action pending in the Etowah Circuit Court, petitions for a writ of mandamus directing Judge William C. Cardwell to set aside his order granting the motion filed by the defendants in the action, SECO Aviation, Inc., and Anthony Aviation Center, Inc., for relief from a default judgment. For the reasons discussed below, we deny the petition.

I. Facts and Procedural History

On December 22, 1997, Full Circle and SECO Aviation, Inc., a corporation organized under the laws of Georgia ("SECO(GA)"), entered into a consignment agreement pursuant to which SECO(GA) agreed to act as a distributer for the sale of 14 helicopter-fuel-dump pumps owned by Full Circle. According to the consignment agreement, Full Circle was to be paid 30 percent of the revenues from the sale of the pumps. Approximately two years later, on August 10, 1999, SECO(GA) sold many of its assets, including the fuel-dump pumps.

On February 27, 2002, Full Circle sued SECO Aviation, Inc., a corporation organized under the laws of Pennsylvania ("SECO(PA)"), and Anthony Aviation Center, Inc., a corporation organized under the laws of Florida ("AAC"), in the Etowah Circuit Court, alleging breach of contract and conversion. Full Circle contended that AAC purchased the 14 fuel-dump pumps from SECO(GA), but that SECO(GA) never paid Full Circle a commission on the sale of the fuel-dump pumps as required under the consignment agreement. Full Circle served the summons and complaint on SECO(PA) and AAC. However, SECO(PA) is a different entity from SECO(GA), with which Full Circle had entered into the consignment agreement. SECO(PA) maintains that it is not legally connected to SECO(GA) in any respect; Full Circle does not dispute this in its reply brief. After SECO(PA) and AAC failed to answer the complaint or to appear within 30 days, Full Circle filed an application and affidavit for the entry of a default judgment. On May 10, 2002, the trial court entered a default judgment against SECO(PA) and AAC; it amended that judgment on June 28, 2002, and July 10, 2002.

On November 19, 2002, the default judgment was filed with the circuit court in Broward County, Florida, for domestication in accordance with the laws of the State of Florida. At this time, SECO(PA) and AAC were provided with notice by certified mail that the default judgment was being domesticated in Florida. Nevertheless, SECO(PA) and AAC failed to respond or to challenge the default judgment within 30 days of this notice, and the default judgment was domesticated in Florida on January 9, 2003. On April 18, 2003, a writ of garnishment was issued by the Broward Circuit Court. Then, on April 23, 2003, SECO(PA) and AAC filed an emergency motion in the Broward Circuit Court to dissolve the writ of garnishment; they argued that the Alabama judgment made the basis of the garnishment action was void because the Etowah Circuit Court lacked personal jurisdiction over them and because, they argue, Full Circle had not properly served the summons and complaint on either of the defendants.

Immediately after filing the emergency motion, SECO(PA) and AAC filed with the Etowah Circuit Court a motion for relief from the default judgment pursuant to Rule 60(b)(4), Ala. R. Civ. P. SECO(PA) and AAC argued that the default judgment was void because, they argued, the trial court lacked personal jurisdiction over them. In its opposition to the motion for relief from the judgment, Full Circle asserted that SECO(PA) and AAC's motion failed to satisfy the requirement of Rule 60(b), Ala. R. Civ. P., that such a motion be filed within "a reasonable time," and that the actions of SECO(PA) and AAC were sufficient to establish minimum contacts so as to warrant the trial court's exercise of personal jurisdiction over them. On June 20, 2003, the trial court granted SECO(PA) and AAC's motion for relief. Full Circle now petitions for a writ of mandamus directing the trial court to set aside its order granting relief pursuant to Rule 60(b)(4). We deny the petition.

II. Standard of Review

The standard of review on appeal from an order granting relief under Rule 60(b)(4), Ala. R. Civ. P. ("the judgment is void"), is not whether the trial court has exceeded its discretion. When the decision to grant or to deny relief turns on the validity of the judgment, discretion has no field of operation. Cassioppi v. Damico, 536 So.2d 938, 940 (Ala.1988). "If the judgment is void, it is to be set aside; if it is valid, it must stand.... A judgment is void only if the court which rendered it lacked jurisdiction of the subject matter, or of the parties, or if it acted in a manner inconsistent with due process." Seventh Wonder v. Southbound Records, Inc., 364 So.2d 1173, 1174 (Ala.1978) (emphasis added).

III. Analysis

Mandamus is an extraordinary writ and will be issued "only where there is (1) a clear legal right in the petitioner to the order sought, (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so, (3) the lack of another adequate remedy, and (4) properly invoked jurisdiction of the court." Ex parte Alfab, Inc., 586 So.2d 889, 891 (Ala. 1991). If SECO(PA) and AAC's Rule 60(b)(4) motion was timely filed and the trial court's default judgment was "void," then Full Circle does not meet the prerequisites for mandamus relief, i.e., it does not have a legal right to have the June 20 order set aside.

A. Rule 60(b)(4) and the Reasonable-Time Limitation

Full Circle's initial argument is that SECO(PA) and AAC's motion for relief from the default judgment was not filed within a reasonable time, as required by Rule 60(b), Ala. R. Civ. P. Full Circle contends that a motion seeking relief from a default judgment filed approximately 14 months after the party filing the motion was served with the complaint is not filed within a reasonable time, as contemplate by Rule 60(b). SECO(PA) and AAC reply to this argument by stating that their motion for relief was filed within a reasonable time because the motion was filed less than 10 months after the default judgment was last amended on July 10, 2002. SECO(PA) and AAC also urge this Court to clarify precedent that has addressed the "reasonable time" requirement for a Rule 60(b)(4) motion.

Rule 60(b) provides that a motion for relief under Rule 60(b)(4) "shall be made within a reasonable time." This Court has stated that "`[w]hat constitutes "reasonable time" depends on the facts of each case, taking into consideration the interest in finality, the reason for delay, the practical ability to learn earlier of the grounds relied upon, and prejudice to other parties.'" Adams v. Farlow, 516 So.2d 528, 557 (Ala.1987) (quoting Ashford v. Steuart, 657 F.2d 1053, 1055 (9th Cir.1981)). Heretofore, this Court has only noted this reasonable-time limitation of Rule 60(b)(4), without analysis. Greene v. Connelly, 628 So.2d 346 (Ala.1993); see also Marshall v. Mid-State Homes, Inc., 468 So.2d 131 (Ala.1985), and McNutt v. Beaty, 370 So.2d 998 (Ala.1979). The opinions of the Court of Civil Appeals are not uniform on this subject. Compare Improved Benevolent & Protective Order of Elks of the World v. Moss, 855 So.2d 1107 (Ala.Civ.App.2003), and Bryant v. First Tuskegee Bank, 866 So.2d 1139 (Ala.Civ.App.2002), with McBrayer v. Hokes Bluff Auto Parts, 685 So.2d 763 (Ala.Civ.App.1996). Today we are called upon to decided whether this reasonable-time limitation applies to a Rule 60(b)(4) motion. We agree with Judge Crawley's special writing concurring in the result in Improved Benevolent & Protective Order of Elks of the World v. Moss, 855 So.2d at 1112, and we adopt the reasoning of Presiding Judge Robertson in McBrayer v. Hokes Bluff Auto Parts, 685 So.2d 763 (Ala.Civ.App.1996), that the reasonable-time limitation is not applicable to actions seeking to set aside a void judgment pursuant to Rule 60(b)(4), Ala. R. Civ. P.

In 1973, Alabama adopted the Alabama Rules of Civil Procedure, which were modeled after the Federal Rules of Civil Procedure. The Federal Rules, like the Alabama Rules, provide that a Rule 60(b)(4) motion "shall be made within a reasonable time." Presiding Judge Robertson in McBrayer reviewed the federal cases applying Rule 60(b)(4), Fed.R.Civ.P., and found that "the majority of federal circuits [had] rejected a literal application of the language in Rule 60(b) and held that the rule does not impose a time limitation on actions to set aside void judgments." 685 So.2d at 765. McBrayer cited Hertz Corp. v. Alamo Rent-A-Car, Inc., 16 F.3d 1126 (11th Cir.1994), in which the United States Court of Appeals for the Eleventh Circuit recognized and embraced the holdings of the United States Courts of Appeals for the First, Fifth, Seventh, Ninth, Tenth, and District of Columbia Circuits "that the time for bringing a Rule 60(b)(4) motion is not constrained by reasonableness," 685 So.2d at 765. See Hertz Corp.,16 F.3d at 1130 (citing 11 C. Wright & A. Miller & M. Kane, Federal Practice and Procedure § 2862 (1995)). Since McBrayer was decided, the Fourth Circuit has also adopted that holding. See In re Heckert, 272 F.3d 253 (4th Cir.2001). The United States District Courts for the Middle and Northern Districts of Alabama have also held that Rule 60(b)(4) motions are not subject to a reasonable-time limitation. R.C. v. Nachman, 969 F.Supp. 682, 692 (M.D.Ala.1997); Battle v. Liberty Nat'l Life Ins. Co., 770 F.Supp. 1499, 1512 (N.D....