Gordon v. Lancaster

Decision Date21 November 2018
Docket NumberOpinion No. 27847,Appellate Case No. 2017-000640
CourtSouth Carolina Supreme Court
Parties Frank GORDON, Jr., Individually and as Trustee of Dorothy S. Gordon (Deceased) Trust, Respondent, v. Donald W. LANCASTER, Petitioner.

425 S.C. 386
823 S.E.2d 173

Frank GORDON, Jr., Individually and as Trustee of Dorothy S. Gordon (Deceased) Trust, Respondent,
v.
Donald W. LANCASTER, Petitioner.

Appellate Case No. 2017-000640
Opinion No. 27847

Supreme Court of South Carolina.

Heard June 14, 2018
Filed November 21, 2018
Rehearing Denied February 20, 2019


Stephen P. Groves, Sr. and Alexandra H. Austin, both of Nexsen Pruet, LLC, of Charleston, and John J. Dodds, III, of The Law Firm of Cisa & Dodds, LLP, of Mt. Pleasant, all for Petitioner.

Justin O'Toole Lucey and Stephanie D. Drawdy, of Justin O'Toole Lucey, P.A., of Mount Pleasant, for Respondent.

JUSTICE HEARN :

425 S.C. 387

We granted certiorari on the narrow question of whether a creditor may execute on a judgment more than ten years after its enrollment when the time period has expired during the course of litigation. Our resolution of this case requires us to revisit our decision in Linda Mc ,1 which the court of appeals broadly interpreted as extending a judgment's life beyond the statutory ten-year limit merely by filing the action within ten years. Gordon v. Lancaster , 419 S.C. 48, 795 S.E.2d 857 (Ct. App. 2016). We reverse and overrule Linda Mc .

FACTUAL BACKGROUND

In December of 2001, Rudolph Drews, the now-deceased uncle of Petitioner Donald Lancaster, was found liable in a civil action for violating securities laws in an investment scheme for a new business venture in

823 S.E.2d 174

Charleston. Judgment

425 S.C. 388

was enrolled against Drews in March of 2002; over the next three years, the court of appeals affirmed and this Court denied certiorari. Thereafter, in August of 2006, Respondent Frank Gordon, a creditor on the 2002 judgment, filed a petition in the circuit court for supplemental proceedings. The court granted the petition, and a hearing ensued one month later, wherein Gordon's counsel became suspicious that Drews' wife and Lancaster were complicit in shielding Drews' assets from creditors. Gordon noted, "[Drew's wife] is intertwined in this, and we believe the nephew is, too, by these gifts." This hearing was continued when Drews failed to produce tax and financial documents.

A year later, in September of 2007, Rudolph Drews died, and his estate was opened shortly thereafter. Gordon sought to continue supplemental proceedings, but delays in administering the estate arose. In February of 2010, Lancaster was deposed as part of supplemental proceedings, which confirmed Gordon's suspicions that he and Drews' wife were involved in shielding Drews' assets. Soon after, one day before her scheduled deposition, Drews' wife died.

On November 2, 2010, Gordon filed this action, asserting Lancaster assisted Drews in hiding assets from creditors in violation of the Statute of Elizabeth.2 A year later, in November of 2011, Drews' estate confessed judgment of $293,703.43, and his wife's estate settled with Gordon for $60,000. Both estates assigned their interests to him.

A two-day bench trial occurred in June of 2013, wherein Lancaster moved for a directed verdict based on Gordon's prior concession that this suit was based on the 2001 judgment. Therefore, according to Lancaster, because more than ten years had elapsed from the date the judgment was entered, the judgment's "active energy" had expired. The court disagreed, relying on this broad language in Linda Mc : "If a party takes action to enforce a judgment within the ten-year statutory period of active energy, the resulting order will be effective even if issued after the ten-year period has expired."

425 S.C. 389

Thus, the court denied the motion and found in favor of Gordon for $211,677.30.

Lancaster appealed to the court of appeals, and in a split decision, the majority, relying on Linda Mc , held the trial court correctly determined section 15-39-30 did not bar satisfaction of the 2001 judgment because Gordon had timely filed this action within the ten-year window and continued to pursue it. Gordon , 419 S.C. at 58, 795 S.E.2d at 862. The dissent found the facts here distinguishable from Linda Mc , noting "[Gordon] had only filed the present action in the circuit court and settled his allegations against the Drews' estates. Although [Gordon] filed this action prior to the expiration of the ten-year period, he was not ‘merely waiting on the court's order regarding execution and levy....’ " Id. at 63, 795 S.E.2d at 865 (Thomas, J., dissenting). Additionally, the dissent noted the merits hearing did not occur for over a year after the ten-year period expired, and therefore posited that extending Linda Mc "thwarts the public policy of this state that limits the life of a judgment to ten years." Id. at 64, 795 S.E.2d at 865. While Lancaster sought certiorari on multiple issues, this Court granted certiorari solely on whether the judgment retained "active energy" and thus, was enforceable.

ISSUE

Does a judgment's ten-year "active energy" terminate when the judgment creditor's enforcement action remains untried when the ten-year period expires, or conversely, does a judgment creditor's mere institution of the enforcement action within ten years extend that ten-year period indefinitely until trial is held and a final order is issued?

STANDARD OF REVIEW

The interpretation of a statute is a question of law, which an appellate court is free to decide without deference to the trial court. Town of Summerville v. City of N. Charleston , 378 S.C. 107, 110, 662 S.E.2d 40, 41 (2008).

823 S.E.2d 175

DISCUSSION

Lancaster contends the court of appeals erroneously expanded this Court's holding in Linda Mc , effectively nullifying

425 S.C. 390

the statutory ten-year limit to execute on a judgment. Conversely, Gordon asserts the court of appeals correctly followed Linda Mc , noting he timely filed this action within the ten-year period and continued to pursue satisfaction of the judgment.

Section 15-39-30 provides,

Executions may issue upon final judgments or decrees at any time within ten years from the date of the original entry thereof and shall have active energy during such period, without any renewal or renewals thereof , and this whether any return may or may not have been made during such period on such executions.

S.C. Code Ann. § 15-39-30 (2005) (emphasis added). According to the statute's plain language, a creditor has ten years to execute on the judgment from the date of its entry, a time period that cannot be renewed.

Linda Mc is this Court's most recent decision addressing section 15-39-30. There, the parties executed a judgment by confession on June 2, 1995. Linda Mc , 390 S.C. at 548, 703 S.E.2d at 501. While the judgment debtor paid a portion of the judgment thereafter, Linda Mc filed a petition for supplemental proceedings nine years after the effective date of the judgment, arguing the debtor had assets subject to execution. Id. at 549, 703 S.E.2d at 502. The trial court granted the petition and referred the matter to a special referee, who held two hearings before the ten-year time period expired. Id. at 549–50, 703 S.E.2d at 502. The referee issued a report in favor of the judgment creditor and the circuit court issued an order of execution, both on June 3, 2005, one day after the time period terminated. Id. at 550, 703 S.E.2d at 502. Despite the passage of more than ten years, the Court held the judgment continued to have "active energy," initially noting

We want to stress that this is a narrow holding limited to facts similar to those at issue in this case. Hence, when a party has complied with the applicable statutes, as Respondent did in this case, and is merely waiting on a court's order regarding execution and levy, the ten year limitation found in section 15–39–30 is extended to when the court finally issues an order.
425 S.C. 391

Id. at 554–55, 703 S.E.2d at 505 (emphasis added). However, in the next paragraph, the Court explained, "While the order came after the ten-year period, a petition for supplemental proceedings was filed before the ten-year period expired. Therefore, the judgment had active energy on June 3, 2005, because that order was the result of the supplemental proceedings filed during the ten-year period." Id. at 555, 703 S.E.2d at 505. Finally, the Court concluded, "[i]f a party takes action to enforce a judgment within the ten-year statutory period of active energy, the resulting order will be effective even if issued after the ten-year period has expired." Id. It is this language the court of appeals relied on in holding the judgment in the instant case retained active energy.3

We note Linda Mc represents a departure from this Court's historic approach in analyzing section 15-39-30, and while we appreciate the compelling facts at issue therein, the decision has created confusion in what was heretofore a well-settled area of the law. Accordingly, we overrule it...

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    • United States
    • United States Bankruptcy Courts. Fourth Circuit. U.S. Bankruptcy Court — District of South Carolina
    • January 7, 2020
    ...has held that the ten-year period to execute on a judgment under § 15-39-30 is a nonrenewable, fixed period. See Gordon v. Lancaster , 425 S.C. 386, 823 S.E.2d 173, 176 (2018). In Gordon , the court stated the following regarding the collection period for a judgment lien:A judgment lien is ......
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    • Court of Appeals of South Carolina
    • October 23, 2019
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