Taylor Peake, Wyatt Props., LLC v. Spencer Wyatt ) Grey First, LLC (In re Wyatt Props., LLC)

• Decision Date: 16 April 2021
• Docket Number: 2200159,2200214
• Citation: 337 So.3d 296
• Parties: EX PARTE WYATT PROPERTIES, LLC, Beacon Towers, LLC, and Taylor Peake (In re: Taylor Peake, Wyatt Properties, LLC, and Beacon Towers, LLC v. Spencer Wyatt ) Ex parte Grey First, LLC (In re: Taylor Peake, Wyatt Properties, LLC, and Beacon Towers, LLC v. Spencer Wyatt )
• Court: Alabama Court of Civil Appeals

337 So.3d 296

EX PARTE WYATT PROPERTIES, LLC, Beacon Towers, LLC, and Taylor Peake

(In re: Taylor Peake, Wyatt Properties, LLC, and Beacon Towers, LLC

v.Spencer Wyatt )

Ex parte Grey First, LLC

(In re: Taylor Peake, Wyatt Properties, LLC, and Beacon Towers, LLC

v.Spencer Wyatt )

2200159

2200214

Court of Civil Appeals of Alabama.

April 16, 2021

Andrew P. Campbell and J. Harris Hagood of Campbell Partners, LLC, Birmingham, for petitioners Wyatt Properties, LLC, Beacon Towers, LLC, and Taylor Peake.

Joshua L. Hornady and Meghan S. Cole of Sirote & Permutt, P.C., Birmingham, for petitioner Grey First, LLC.

Gary W. Lee of Wallace Jordan Ratliff & Brandt, LLC, Birmingham, for respondent.

EDWARDS, Judge.

In appellate case number 2200159, Wyatt Properties, LLC, Beacon Towers, LLC, and Taylor Peake petition this court for a writ of mandamus directing Judge Agnes Chappell, who serves as a judge in the Domestic Relations Division of the Jefferson Circuit Court ("the domestic-relations division"), to enter an order (1) transferring to the Civil Division of the Jefferson Circuit Court ("the civil division") certain claims they filed in the domestic-relations division against Spencer Wyatt and a counterclaim that Wyatt, on behalf of himself and purportedly on behalf of Wyatt Properties and Beacon Towers, filed against Peake and Grey First, LLC,¹ or (2) dismissing those claims and the counterclaim. For ease of reference and for the purpose of addressing the positions taken by Peake in the underlying proceedings, Wyatt Properties, Beacon Towers, and Peake are collectively referred to as "the Peake petitioners." The Peake petitioners contend that they are entitled to the requested relief on the ground that the domestic-relations division lacks subject-matter jurisdiction over the claims at issue. The Peake petitioners also argue that Judge Chappell exceeded her discretion by denying their request for a jury trial as to certain claims.

Grey First has adopted the Peake petitioners’ arguments regarding Wyatt's counterclaim and also has filed its own mandamus petition, appellate case number 2200214, raising arguments regarding the counterclaim asserted against it and also arguing that Wyatt failed to satisfy the requirements for pleading a derivative claim. This court has consolidated the petitions ex mero motu.

On March 22, 2019, Judge Chappell entered a judgment divorcing Wyatt and Peake. The divorce judgment was based on a settlement agreement entered between Wyatt and Peak ("the settlement agreement"), which stated that it would be "incorporated in" any final judgment of divorce. The divorce judgment stated that the settlement agreement was "ratified and approved and made a part of this [divorce judgment], the same as if fully set out herein, and [that] the parties are ordered to comply therewith." The settlement agreement included provisions regarding the division of marital property, custody of the parties’ child, and a waiver of alimony by each party, among other matters. The settlement agreement included the following provisions regarding the ownership and management of Wyatt Properties, which is a member-managed limited-liability company, and Beacon Towers:

"35. Wyatt Properties ... [Wyatt] and [Peake] each have a fifty percent (50%) membership interest in Wyatt Properties .... The parties shall continue to own and manage said entity and all holdings of said entity as 50-50 co-owners (i.e., the parties’ divorce shall not cause any change to the structure of Wyatt Properties ...). So long as Wyatt Properties ... generates income, [Wyatt] and [Peake] shall each receive fifty percent (50%) of any income resulting from their interest in said entity. All monthly financial statements for Wyatt Properties ... shall be sent directly to [Peake].

"36. Beacon Towers ... Wyatt Properties ... has a one hundred percent (100%) membership interest in Beacon Towers .... Wyatt Properties ..., as an entity co-owned by [Wyatt] and [Peake], shall continue to own and manage Beacon Towers ... and all holdings of said entity as its sole member (i.e., the parties’ divorce shall not cause any change to the structure of Beacon Towers ...). So long as Beacon Towers ... generates income, Wyatt Properties ... shall receive any income resulting from its interest in said entity."

(Emphasis added.) Based on the materials before us, the primary asset of Beacon Towers was a commercial-office building, and the primary asset of Wyatt Properties was Beacon Towers. The settlement agreement also included a release-and-waiver provision ("the release provision") that stated:

"4. The parties hereto, exclusive of the terms and provisions of this instrument, each waive all right, title, and interest, consummate and inchoate, in and to the property and estate of the other by way of expectancy or reversion or otherwise, including marital, insurance, contractual, and all other rights by way of dower, homestead, exemption, alimony, or otherwise, in present or in expectancy as to any and all property and estate of the other, and each of the parties do hereby release and discharge the other from any and all control, claims, demands, actions, or causes of action, except as to the obligations imposed by [the settlement agreement] ... or by the Court's [judgment], this being intended as full, final, and complete settlement of the property, marital, and other rights of the parties hereto."

(Emphasis added.)

Before continuing with the procedural history, we note that Grey First is a manager-managed limited-liability company and was formed by Peake on March 11, 2020. Based on the materials before us, Peake is the manager of Grey First and owns a 75% membership interest in Grey First; the remaining 25% membership interest is owned by an individual who is not a party in the underlying proceedings.

On August 24, 2019, Peake filed a petition for modification of child custody in the domestic-relations division, which was assigned case number DR-18-900658.01 ("the modification action"). Peake alleged in her modification petition that a material change of circumstances had occurred since the entry of the divorce judgment, and she sought an order awarding her sole legal and sole physical custody of the parties’ child and child support. On September 29, 2019, Peake amended her modification petition ("the September 2019 amended modification petition") by adding allegations quoting paragraphs 35 and 36 of the settlement agreement and stating that she and Wyatt were

"co-owners in Wyatt Properties and Beacon Towers .... [Wyatt] is the managing partner in the business. [Wyatt] is responsible for all day to day activities of the business, including management of Beacon Towers.² [Peake] has recently become aware that Beacon Towers is imminent of foreclosure. [Wyatt] has failed to pay the building vendors and the utilities as contractually obligated. As a result, the business is roughly $150,000.00 in debt and a lien has been placed on the building. [Wyatt] has been withdrawing money from the business and using it for his own personal use. [Peake] alleges [Wyatt] has been stealing money from the business according to the company's financial statements and she is currently struggling to satisfy the outstanding debts.

"... [Wyatt] has defrauded the company and needs to be removed as a partner immediately."

In the September 2019 amended modification petition, Peake also added requests that the domestic-relations division make her the sole owner of Wyatt Properties and Beacon Towers, that it divest Wyatt of all interest in Wyatt Properties and Beacon Towers, and that it order Wyatt to reimburse her for all debts paid solely by Peake relating to those entities.

On October 10, 2019, Peake, on behalf of herself and purportedly on behalf of Wyatt Properties and Beacon Towers, filed a complaint against Wyatt in the civil division, which was assigned case number CV-19-904525 and was assigned to Judge Marshell Jackson Hatcher ("the civil action").³ In that complaint, the Peake petitioners alleged that Wyatt had been responsible for the management of Wyatt Properties and Beacon Towers and that he had "continuously and systematically neglected his managerial responsibilities since as early as March of 2019," purportedly by, among other things, failing to pay vendors that had provided utility services for Beacon Towers. In addition, the Peake petitioners alleged that Wyatt had failed to pay Beacon Towers’ property taxes for 2018 and that Beacon Towers "owe[d] approximately $32,701.29 in past due [property] taxes." The complaint also included allegations that Wyatt had failed to file Wyatt Properties’ income-tax returns for 2016, 2017, and 2018⁴ and had underpaid taxes for that company in 2014 and 2015, which allegedly had resulted in an outstanding tax obligation of $5,501.53. The complaint further included allegations that Wyatt had commingled tenant security deposits with operating funds but does not reference a time frame for that alleged action; that, post-divorce, he had charged personal expenses to accounts for Wyatt Properties; and that he had violated the divorce judgment by failing to provide Peake with financial statements for Wyatt Properties. Peake alleged that she had assumed managerial control of Wyatt Properties and the building owned by Beacon Towers but that Wyatt had retained possession of company credit cards and was restricting her access to certain books and records. Peake further alleged that Wyatt Properties was "deadlocked" by Wyatt's refusal to cooperate with Peake to address certain matters. The complaint asserted claims for dissociation and removal of Wyatt as a member of Wyatt Properties, for preliminary and permanent injunctive relief against Wyatt, and for compensatory damages based on Wyatt's alleged breaches of fiduciary duties to each of the Peake petitioners. The complaint further requested a jury trial.

On November 13, 2019, Wyatt filed a motion to dismiss the civil action. Wyatt contended...