Southtrust Bank of Florida, N.A. v. Wilson, 96-1046-CIV-T-17A.

• Decision Date: 09 July 1997
• Docket Number: No. 96-1046-CIV-T-17A.,96-1046-CIV-T-17A.
• Citation: 971 F.Supp. 539
• Parties: SOUTHTRUST BANK OF FLORIDA, N.A., a National Banking Corporation, Plaintiff, v. Harold S. WILSON, Mary Ellen Wilson, and United States of America, Defendants.
• Court: U.S. District Court — Middle District of Florida

971 F.Supp. 539

SOUTHTRUST BANK OF FLORIDA, N.A., a National Banking Corporation, Plaintiff, v. Harold S. WILSON, Mary Ellen Wilson, and United States of America, Defendants.

No. 96-1046-CIV-T-17A.

United States District Court, M.D. Florida, Tampa Division.

July 9, 1997.

L. Geoffrey Young, Dale W. Cravey, Gaynor, Decker, Young, Malchon, Dickson, Schumaker & Bernstein, Tampa, FL, for Plaintiff.

Harold S. Wilson, Harold S. Wilson, P.A., Clearwater, FL, pro se.

Harold S. Wilson, Harold S. Wilson, P.A., Clearwater, FL, for Mary Ellen Wilson.

Mary Apostolakos Hervey, U.S. Dept. of Justice, Washington, DC, for U.S.

ORDER ON MOTIONS FOR SUMMARY JUDGMENT

KOVACHEVICH, Chief Judge.

This cause is before the Court on the following motions and responses:

1. Motion for Summary Judgment by Defendant, UNITED STATES OF AMERICA, (Docket No. 15) and memorandum in support (Docket No. 16), filed January 14, 1997.

2. Motion for Summary Judgment of Interpleader by Plaintiff, SOUTHTRUST BANK OF FLORIDA, N.A., (Docket No. 17) and memorandum in support (Docket No. 18), filed January 17, 1997.

3. UNITED STATES OF AMERICA's Response to Plaintiff's Motion for Summary Judgment of Interpleader (Docket No. 19), filed January 31, 1997.

4. Response to UNITED STATES OF AMERICA's Motion for Summary Judgment and Motion for Summary Judgment by Defendants, HAROLD S. WILSON and MARY ELLEN WILSON, (Docket No. 20), filed February 3, 1997.

5. UNITED STATES OF AMERICA's Response to HAROLD and MARY ELLEN WILSON's Motion for Summary Judgment (Docket No. 21), filed February 10, 1997.

I. STATEMENT OF THE CASE

Plaintiff, SouthTrust Bank of Florida, N.A. ("SouthTrust") brought this action for interpleader and declaratory relief under Rule 22, Federal Rules of Civil Procedure.¹ SouthTrust requests that the Court remove SouthTrust from further litigation by discharging its liability and reimbursing SouthTrust for attorney's fees and costs.

On March 27, 1989, the Internal Revenue Service ("IRS") assessed Harold Wilson $33,477.38 under 26 U.S.C. § 6672. On June 15, 1989, Harold and Mary Ellen Wilson (the "Wilsons") assigned a U.S. Treasury Note SER C-97, Cusip 912827VN9 (the "Security") with a par value of $50,000 to Ameribank² as security described in a Bond to Stay Collection of Assessment, with the caveat that "neither the securities described nor the proceeds of their sale or redemption [shall] be paid over to the undersigned [the Wilsons] without the express written consent of the Internal Revenue Service." SouthTrust Complaint, Exhibit A. On October 19, 1989, Ameribank, the Internal Revenue Service, Harold Wilson, and Mary Ellen Wilson entered into an Escrow Agreement. The agreement appointed Ameribank as the escrow agent whose responsibilities were governed by the Escrow Agreement.

According to the terms of the Escrow Agreement, either the IRS or the Wilsons could direct Ameribank to file an action in interpleader to resolve a disagreement about the Agreement. However, the Wilsons and the IRS first must attempt, in good faith, to resolve their disagreements. Methods of resolution include: "reducing all disagreements to writing, submitting each party's views in writing to the other, conferring telephonically and at the offices of IRS if so requested by IRS, and otherwise communicating to resolve any disagreement." SouthTrust Complaint, Exhibit B. If resolution of the problem was not completed in ninety (90) days, either party could ask Ameribank to proceed with the interpleader action.

On November 22, 1989, Harold Wilson brought a refund action in this Court against the United States of America (the "United States") to challenge the IRS assessment. (Case No. 89-1576-CIV-T-15C). On February 21, 1992, judgment was entered against Mr. Wilson for $33,477.38, plus interest, minus the amount of previous payments made by Mr. Wilson. Mr. Wilson then appealed to the Eleventh Circuit Court of Appeals, and on March 12, 1993, the Eleventh Circuit affirmed the District Court's ruling.

On May 28, 1993, Mr. Wilson sent a check for $36,258.49 to the IRS to satisfy the judgment. In an attached letter, Mr. Wilson estimated that he owed $4,781.11 in interest. He calculated this interest based on the period beginning on the judgment date (February 21, 1992) and ending on the payment date (May 28, 1993). Mr. Wilson then asked the IRS to notify Ameribank that the Security could be returned to Mr. Wilson.

On July 30, 1993, an IRS Revenue Officer notified Mr. Wilson that interest is calculated from the date of assessment (March 27, 1989) until the date of payment. Therefore, Mr. Wilson still owed $3,308.79 according to the IRS. On August 5, 1993, Mr. Wilson sent the IRS Revenue Officer a letter asserting that pre-judgment interest merges into the final judgment. Mr. Wilson reiterated that his previous payment on May 28 satisfied the judgment.

On September 23, 1993, the IRS sent a Final Notice (Notice of Intention to Levy) to Mr. Wilson indicating that he still owed $3,308.78 plus $7,654.95 in accumulated interest. Subsequently, on October 4, 1993, Mr. Wilson sent a check for $3,308.79 "as full payment and satisfaction of any sums that may be due" to the IRS. United States Memorandum in Support, Exhibit G. On December 28, 1993, the IRS notified Mr. Wilson of the receipt of his check, but explained that Mr. Wilson still owed $7,766.78 (calculated to January 15, 1994).

On November 2, 1994, the IRS notified Ameribank (now SouthTrust) that Mr. Wilson still owed $8,284.81 (calculated to November 20, 1994). The IRS directed the escrow agent to reduce the Security to cash and pay the balance. SouthTrust then notified the Wilsons that the Security would be liquidated unless the Wilsons proved that they already paid the balance.

II. STANDARD OF REVIEW

Summary judgment is proper if the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party must state the basis for its motion and must identify the portions of the record that show the absence of a genuine issue of material fact. The burden can be discharged by "showing ... that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 2554, 91 L.Ed.2d 265 (1986).

Once the moving party meets its burden, the nonmoving party must go beyond the pleadings and designate specific facts in his affidavits, or in the depositions, answers to interrogatories, and admissions, that show a genuine issue of material fact. Cheatwood v. Roanoke Indus., 891 F.Supp. 1528, 1532 (N.D.Ala.1995), citing Celotex, 477 U.S. at 324, 106 S.Ct. at 2553.

Issues of fact are genuine "only if a reasonable jury considering the evidence presented could find for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). Material facts are those that would affect the outcome of the trial. Id. at 248, 106 S.Ct. at 2510. In determining whether a material fact exists, the court must consider all evidence in the light most favorable to the nonmoving party. Sweat v. Miller Brewing Co., 708 F.2d 655, 656 (11th Cir.1983). All doubt as to the existence of a genuine issue of material fact must be resolved against the moving party. Hayden v. First Nat'l Bank of Mt. Pleasant, 595 F.2d 994, 996-97 (5th Cir.1979), quoting Gross v. Southern R.R., 414 F.2d 292 (5th Cir.1969).

III. ANALYSIS

A. The Validity of the Interpleader Action

SouthTrust correctly brought this interpleader action based on its responsibilities under the Escrow Agreement. Even if the Agreement did not stipulate to the interpleading of the United States and the Wilsons, SouthTrust could validly bring an action under Rule 22 of the Federal Rules of Civil Procedure. "Persons having claims against the plaintiff may be joined as defendants and required to interplead when their claims are such that the plaintiff is or may be exposed to double or multiple liability." Fed. R.Civ.P. 22(1). Either the United States or the Wilsons could sue SouthTrust based on its agency relationship to both parties. Ultimately, SouthTrust could be subjected to double or multiple liability if both parties were not interpled.

No genuine issue of material fact exists relative to SouthTrust's adherence to the Escrow Agreement's interpleader procedure. The United States agrees that SouthTrust appropriately filed the interpleader action. In addition, the Wilsons do not challenge the validity of the interpleader action. All parties agree that the United States and the Wilsons have competing claims over the Security that SouthTrust holds as escrow agent.

Under the terms of the Escrow Agreement, the United States and the Wilsons were required to communicate their respective disagreements to one another and faithfully try to resolve each disagreement. If ninety (90) days elapsed without resolution, either party could direct SouthTrust in writing to file an action in interpleader. After SouthTrust notified the IRS that the Wilsons disagreed with the interest assessment, the IRS was put on notice about the disagreement.

The amount of communication and cooperation between the parties is not clear from the record. However, according to the correspondence between all parties, each side knew about the conflicting demands. The IRS properly directed SouthTrust to file this interpleader action after the ninety (90) day period expired.

In their answer to the complaint, the Wilsons deny that SouthTrust is an innocent stakeholder. The Wilsons allege that SouthTrust became an adversary because SouthTrust withheld an interest payment on the bond in May, 1996. However, this alleged breach of contract demonstrates the necessity of the interpleader action. SouthTrust did not know if the...