McCollough v. Regions Bank

• Decision Date: 06 October 2006
• Docket Number: 1040665.
• Citation: 955 So.2d 405
• Parties: E. Gaylon McCOLLOUGH v. REGIONS BANK.
• Court: Alabama Supreme Court

955 So.2d 405

E. Gaylon McCOLLOUGH v. REGIONS BANK.

1040665.

Supreme Court of Alabama.

October 6, 2006.

A. Riley Powell IV of the Powell Law Firm, P.C., Gulf Shores, for appellant.

Alan C. Christian of Johnstone, Adams, Bailey, Gordon & Harris, LLC, Mobile, for appellee.

BOLIN, Justice.

The defendant below, E. Gaylon McCollough, appeals from the summary judgment in favor of the plaintiff, Regions Bank. We affirm.

Facts and Procedural History

McCollough, Larry Brock, and James Bailey were members in Medical Visions of Alabama, LLC, a limited liability company. On September 28, 2001, McCollough entered into a commercial guaranty contract with Regions Bank. Brock and Bailey entered into similar contracts with Regions Bank. In these contracts, they each agreed to pay differing portions of Medical Visions' indebtedness to Regions Bank. McCollough agreed to pay 20%, Brock agreed to pay 30%, and Bailey agreed to pay 20%. The remaining 30% of Medical Visions' indebtedness to Regions Bank was to be paid by persons or business entities the parties refer to as the collective limited guarantors. The parties do not identify the collective limited guarantors.

According to the commercial guaranty contracts, Medical Visions, on September 28, 2001, had executed a promissory note payable to Regions Bank in the amount of $2.1 million. However, the parties have not included this promissory note in the record. A second promissory note dated April 8, 2002, is included in the record. The second note was also for the amount of $2.1 million.¹ On December 19, 2002, the collective limited guarantors paid 30% of the indebtedness of Medical Visions then outstanding, totaling $615,328.97. After that payment, the principal balance was $1,414,764.97. McCollough, Brock, and Bailey, though, failed to pay the percentages they had agreed to pay in their respective commercial guaranty contracts.

On February 26, 2004, Regions Bank sued Medical Visions, McCollough, Brock, and Bailey, alleging breach of contract and seeking an attorney fee. Regions Bank also sued Raymond James & Associates, Inc., which had submitted a securities account control agreement to Regions Bank to secure McCollough's commercial guaranty contract, alleging breach of contract.

On August 9, 2004, Regions Bank filed a motion for a partial summary judgment, arguing that Medical Visions was in default under the second promissory note and that McCollough, Brock, and Bailey were in default under the terms of their respective commercial guaranty contracts. In support of its motion, Regions Bank attached copies of the second promissory note, the three commercial guaranty contracts, and affidavits from Regions Bank employees and two attorneys. On October 13, 2004, Medical Visions and McCollough filed a response to Regions Bank's motion. It is unclear from the record whether Brock and Bailey filed a response. A hearing was held on the motion on October 15, 2004. On November 5, 2004, Medical Visions and McCollough filed a "Motion for Additional Time to Respond to Plaintiff's Motion for Summary Judgment before Court's Order." In their motion, Medical Visions and McCollough claimed that they had not received Regions Bank's answers to discovery requests and that they had not been able to depose representatives from Regions Bank, despite their requests. They further stated that the evidence sought by discovery is necessary for them to respond to Regions Bank's motion for a partial summary judgment.

The trial court never ruled on the motion for additional time; it entered its judgment in favor of Regions Bank and against Medical Visions, McCollough, Brock, and Bailey on November 23, 2004. Regions Bank's claim against Raymond James remains pending. The trial court made its judgment against Medical Visions, McCollough, Brock, and Bailey final pursuant to Rule 54(b), Ala. R. Civ. P.

On December 6, 2004, McCollough and Medical Visions filed a motion, asking that the trial court

"[r]econsider its November 23, 2004 Order ... and as grounds therefor sets down and assigns the following:

"1. [Medical Visions and McCollough] were denied an opportunity to depose material and relevant corporate representatives of the Plaintiff, Regions Bank, prior to the court's hearing on this Plaintiff's Motion for Partial Summary Judgment.

"2. [Medical Visions and McCollough] previously filed their Motion for Extension of Time to file additional Response to Plaintiff's Motion for Summary Judgment prior to court's ruling citing the fact that they were denied the opportunity to depose these above-mentioned relevant corporate representatives....

"3. [Medical Visions and McCollough] have been greatly prejudiced by the above-mentioned denial of their right to discovery."

Regions Bank submitted its response to Medical Visions and McCollough's motion on December 10, 2004, arguing that the motion was not a proper Rule 59(e), Ala. R. Civ. P., motion, to alter, amend, or vacate the judgment, because Medical Visions and McCollough are not asking the trial court to reconsider its ruling on the summary judgment but are asking for reconsideration of their motion for additional time. The trial court denied the motion for reconsideration on January 5, 2005.

McCollough filed a notice of appeal on February 9, 2005. Regions Bank filed a motion to dismiss the appeal as untimely on March 1, 2005.

I. Was the appeal timely?

Regions Bank argues that this appeal was not filed within the time limit set out in Rule 4, Ala. R.App. P. Regions Bank argues that because Medical Visions and McCollough's motion to reconsider was not an appropriate Rule 59(e), Ala. R. Civ. P., motion, it did not extend the time in which McCollough could file his appeal.

This Court stated in Ex parte Johnson, 673 So.2d 410, 412 (Ala.1994): "The Alabama Rules of Civil Procedure make no reference to a `motion to reconsider.' However, this Court treats a motion so styled as a Rule 59(e) motion to `alter, amend, or vacate' a judgment, if it complies with the guidelines for such post-trial motions set out in Rule 59." See also Ex parte Troutman Sanders, 866 So.2d 547, 549 (Ala.2003).

According to Rule 4(a)(3), Ala. R.App. P., "[t]he filing of a post-judgment motion pursuant to Rules 50, 52, 55, or 59 of the Alabama Rules of Civil Procedure ... shall suspend the running of the time for filing a notice of appeal." This Court has held on numerous occasions that the "proper filing of a Rule 59(e) motion `suspend[s] the running of the time for filing a notice of appeal.' Ala. R.App. P. 4(a)(3)." Ex parte Troutman Sanders, 866 So.2d at 549. See also Waters v. J.I. Case Co., 548 So.2d 454 (Ala.1989); Evans v. Waddell, 689 So.2d 23, 26-27 (Ala.1997).

Therefore, the issue presented here is whether the motion filed by Medical Visions and McCollough was a valid Rule 59(e) motion, therefore suspending the time in which to file an appeal. Rule 59(e) does not give much guidance, stating simply that "[a] motion to alter, amend, or vacate the judgment shall be filed not later than thirty (30) days after entry of the judgment." However, we note that the Alabama Court of Civil Appeals stated in Brown v. Murray Security Guard Co., 404 So.2d 79, 81 (Ala.Civ.App.1981), that "both federal and state courts mandate that the rules of procedure be `liberally construed to achieve justice.' Smith v. Jackson Tool & Die, Inc., 426 F.2d 5, 8 (5th Cir.1970)."

This Court in Moore v. Glover, 501 So.2d 1187 (Ala.1986), provided a basis for determining whether a motion to reconsider is proper.

"A motion for reconsideration made after the entry of an order granting a summary judgment is not proper where the motion is not directed to a reconsideration of the evidence upon which summary judgment was based or does not seek a reargument of the legal considerations underlying the initial judgment, but is instead simply used by plaintiff to submit evidence, belatedly, in opposition to the defendant's motion for summary judgment."

501 So.2d at 1189. This Court held that the motion to reconsider in Moore had been properly denied because it was "not intended to have the trial court reconsider the evidence on which it had based its order granting summary judgment," but to reconsider the summary-judgment order in light of new evidence. 501 So.2d at 1188-89. In order to present new evidence in a motion to alter, amend, or vacate a summary judgment, "`the plaintiff must show circumstances which prevented his presenting evidence to counter that offered in support of the summary judgment.'" 501 So.2d at 1189-90 (quoting Willis v. Ideal Basic Indus., Inc., 484 So.2d 444, 445 (Ala.1986)).

In Green Tree Acceptance, Inc. v. Blalock, 525 So.2d 1366, 1369 (Ala.1988), this Court discussed the holding in Moore:

"[T]his Court recently decided a case analogous to the instant case involving the introduction of new evidence in a post-judgment motion. Moore v. Glover, 501 So.2d 1187 (Ala.1986). In that case the Court held that when new — as opposed to newly discovered — evidence was first introduced in a post-judgment motion and no reason or justification was given for failing to present the evidence while the summary judgment motion was pending, the trial judge could not consider the new evidence. Moore, 501 So.2d at 1189. Nevertheless, if the plaintiff had `offered a proper explanation for his failure to offer that additional evidence in response to defendant's motion for summary judgment, the trial court could have considered it in deciding whether to amend or vacate its entry of summary judgment.' Id. (emphasis supplied). Furthermore, `[a]ny reasonable explanation of the party's failure to offer evidence in response to a motion for summary judgment [would] suffice, but this does not mean that under the guise of a Rule 59(e) motion a party [could] belatedly submit available evidence in opposition to a motion for summary judgment.' Moore, 501 So.2d at 1191 (Torbert, C.J., concurring specially)."

The...