Ex parte Living By Faith Christian Church

• Decision Date: 05 November 2021
• Docket Number: 1190872
• Parties: Ex parte Living By Faith Christian Church v. Young Men's Christian Association of Birmingham In re: Living By Faith Christian Church
• Court: Alabama Supreme Court

Ex parte Living By Faith Christian Church

In re: Living By Faith Christian Church
v.
Young Men's Christian Association of Birmingham

No. 1190872

Supreme Court of Alabama

November 5, 2021

Jefferson Circuit Court, CV-18-349; Court of Civil Appeals, 2180674

PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS

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STEWART, JUSTICE

We granted the certiorari petition of Living By Faith Christian Church ("the Church") to consider, as a question of first impression, whether Rule 55(b)(2), Ala. R. Civ. P., requires a trial court to hold a hearing before entering a default judgment. The Court of Civil Appeals, in Living By Faith Christian Church v. Young Men's Christian Ass'n of Birmingham, [Ms. 2180674, Mar. 20, 2020] ___ So.3d ___ (Ala. Civ. App. 2020), determined that the Jefferson Circuit Court ("the trial court") did not err in granting the application for a default judgment filed by the Young Men's Christian Association of Birmingham ("the YMCA") without first holding a hearing. Based on the reasons expressed below, we agree with the Court of Civil Appeals' determination and conclude that Rule 55(b)(2) does not require a trial court to hold a hearing on every application or motion for a default judgment.

Background

The Court of Civil Appeals provided the following relevant factual and procedural history:

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"On August 14, 2018, the Young Men's Christian Association of Birmingham ('the YMCA') commenced an action against the Church and four of its employees, Jeremy Price, Johnitra Price, Tavares Cook, and Jessica Cook. The YMCA's complaint alleged that the YMCA had given the Church permission to use one of the YMCA's buildings ('the building') in Birmingham on a temporary basis that the YMCA had subsequently notified the Church that it would have to vacate the building, and that the Church had refused to vacate the building. As relief, the YMCA's complaint sought possession of the building and an award of damages. All five defendants were served with process, with Jeremy Price being served not only individually but also as the Church's agent. On September 7, 2018, a single answer signed by both of the Prices and both of the Cooks was filed on behalf of all five defendants. In the answer, the defendants described the Church as 'a domestic non-profit corporation organized and existing under the laws of the State of Alabama.' Jeremy Price signed the answer as 'Founder & Senior Pastor, Living By Faith Christian Church,' and Johnitra Price signed the answer as 'Executive Pastor, Living By Faith Christian Church.' A licensed attorney did not sign the answer on behalf of any of the defendants

"On October 15, 2018, the YMCA filed a motion for a partial summary judgment against all five defendants insofar as the YMCA's complaint sought possession of the building. On October 22, 2018, a response opposing the YMCA's partial-summary-judgment motion was filed on behalf of all five defendants. Jeremy Price signed that response as 'Founder & Senior Pastor, Living By Faith Christian Church,' and Johnitra Price signed that response as 'Executive Pastor, Living By Faith Christian Church.' A licensed attorney did not sign that response on behalf of any of the defendants.

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"Also on October 22, 2018, the YMCA filed an application and affidavit for the entry of a default judgment ('the application') against the Church for failure to answer or otherwise defend, presumably based on the fact that neither the Church's answer nor its response in opposition to the partial-summary-judgment motion had been signed by a licensed attorney. See, e.g., Progress Indus., Inc. v. Wilson, 52 So.3d 500, 597 (Ala. 2010) (recognizing that the general rule in Alabama is that a person must be a licensed attorney in order to represent a separate legal entity, such as a corporation, and that a pleading filed by a nonattorney engaging in the unauthorized practice of law by purporting to represent a separate legal entity is a nullity). The YMCA supported its application with an affidavit signed by Dan Pile, the YMCA's president and chief operating officer, in which he testified that the YMCA owned title to the building, authenticated the attached deed by which the YMCA had acquired title to the building, testified that the YMCA had given the Church permission to use the building for Sunday church services until the YMCA conveyed the building to the A.G. Gaston Boys & Girls Club ('the Boys & Girls Club'), authenticated an e-mail informing the Church that it was permitted to use the building for Sunday church services until the building was conveyed to the Boys & Girls Club, testified that he had notified the Church that they would have to vacate the building so that the YMCA could close the transfer of the building to the Girls & Boys Club, and testified that the Church had refused to vacate the building. The YMCA served the application on both of the Prices and both of the Cooks, but it did not send a service copy addressed to the Church. None of the defendants requested a hearing regarding the application.

"On December 12, 2018, the trial court held a hearing regarding the partial-summary-judgment motion at which the

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YMCA's attorney, both of the Prices, and both of the Cooks appeared. The record does not contain a transcript of that hearing. On December 14, 2018, the trial court entered two separate judgments. One of those judgments was a partial default judgment against the Church insofar as the YMCA sought possession of the building. The other judgment was a partial summary judgment against the Prices and the Cooks insofar as the YMCA sought possession of the building. Neither judgment adjudicated the action insofar as the YMCA's claim sought damages. The partial default judgment against the Church contained a certification that it was a final judgment pursuant to Rule 54(b), Ala. R. Civ. P. The partial summary judgment did not contain such a certification; however, in response to a motion filed by the YMCA, the trial court, on January 10, 2019, entered an order certifying the partial summary judgment as a final judgment pursuant to Rule 54(b).

"On January 14, 2019, a motion to set aside the partial default judgment against the Church signed by Johnitra Price as executive pastor of the Church was filed. On January 16, 2019, the YMCA filed a response to the motion to set aside the partial default judgment in which it alleged, among other things, that the Prices and the Cooks had been advised at the December 12, 2018, hearing that the Church had to be represented by a licensed attorney and that, despite being so advised, a nonattorney had improperly filed the motion to set aside the partial default judgment on behalf of the Church. On January 31, 2019, the YMCA filed a motion to strike the motion to set aside the partial default judgment on the ground that it had been filed on behalf of the Church by a nonattorney.

"On April 4, 2019, the trial court held a hearing at which the Prices and the Cooks appeared but no licensed attorney

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appeared on behalf of the Church. The trial court ruled that it could not consider arguments made by nonattorneys on behalf of the Church and denied the motion to set aside the partial default judgment.

"On April 15, 2019, a licensed attorney representing the Church filed a Rule 60(b)(4), Ala. R. Civ. P., motion for relief from the partial default judgment. In that motion, the Church, citing Progress Industries, Inc. v. Wilson, 52 So.3d 500 (Ala. 2010), and Dial v. State, 374 So.2d 361 (Ala. Civ. App. 1979), asserted that, regardless of whether the Church had validly defended the action through its having a nonattorney file the September 7, 2018, answer on its behalf, the filing of that answer on its behalf constituted an 'appearance' in the action by the Church for purposes of Rule 55(b)(2), Ala. R. Civ. P.; that, because the Church had appeared in the action for purposes of Rule 55(b)(2), Rule 55(b)(2) required the YMCA to give the Church notice of the filing of the application; that the YMCA had not given the Church such notice; and that, therefore, the partial default judgment against the Church had to be set aside. Following a hearing, the trial court entered an order denying the Church's Rule 60(b)(4) motion on May 6, 2019."

Living By Faith Christian Church, ___ So.3d at ___ (footnotes omitted).

On appeal, the Church argued, among other things, that the partial default judgment entered against the Church was due to be vacated because the trial court had failed to hold a hearing on the YMCA's application for a default judgment before granting the application. The Church contended that, pursuant to Rule 55(b)(2), Ala. R. Civ. P., a trial

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court is required to hold a hearing on an application or motion for a default judgment when the defaulting party has appeared in the action. The Court of Civil Appeals, in affirming the trial court's denial of the Church's Rule 60(b)(4), Ala. R. Civ. P., motion for relief from the partial default judgment entered against the Church, concluded:

"[B]ased on the presence of permissive language in Rule 55(b)(2) providing that a trial court 'may' hold a hearing on an application for a default judgment, based on the absence of any language in Rule 55(b)(2) requiring a trial court to hold such a hearing, based on the fact that the application itself established the YMCA's prima facie right to possession of the building, and based on the fact that the Church did not request a hearing regarding the application despite having notice of the filing of the application through its agents Jeremy Price and Johnitra Price, we conclude that the trial court in the present case was not required to hold a hearing on the YMCA's application

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