Session February 25, 2015
Appeal from the Chancery Court for Blount County No. 2012-057 David R. Duggan, Judge
Robert T. Stooksbury, Jr. (the creditor) obtained a judgment in federal district court against, among others, Rebecca Ross Jordan, the daughter of Patricia Ross, the plaintiff in the case now before us. The creditor then attempted, in federal court, to garnish the funds in three bank accounts jointly held by Jordan and plaintiff. Plaintiff argued to the federal court that the funds should not be subject to garnishment because, according to her, they were solely owned by plaintiff. The federal district court, applying Tenn. Code Ann. § 45-2-703(a) (2007), held that the "applicable statutory authority directs that the moneys deposited into the account[s] owned by both Ms. Ross and Ms. Rebecca Ross Jordan are subject to the claims of creditors of either depositor . . ." and, consequently, the federal court allowed execution on and garnishment of the funds. The federal court later ordered, without objection by plaintiff, disbursement of the funds to the creditor. Plaintiff then brought this action under Tenn. Code Ann. § 45-2-703(a), which provides in pertinent part that "any other depositor not indebted to the creditor may, by commencing a separate action against the creditor, establish the rights that the depositor may have in the funds." The creditor in the case now before us filed a motion to dismiss on the ground that plaintiff's claim was barred by the doctrine of res judicata. The trial court agreed and dismissed plaintiff's action. We affirm the judgment of the trial court.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed; Case Remanded
Christopher J. Oldham, Knoxville, Tennessee, for the appellant, Patricia Ross.
Wayne A. Ritchie II and James R. Stovall, Knoxville, Tennessee, for the appellee, Robert T. Stooksbury, Jr.
Charles D. Susano, Jr., C.J., delivered the opinion of the court, in which D. Michael Swiney and John W. McClarty, JJ., joined.
CHARLES D. SUSANO, JR., CHIEF JUDGE
In response to the creditor's request in the federal action that the court issue a garnishment of the funds, plaintiff filed a "petition to exclude Patricia C. Ross's checking, savings and certificate of deposit accounts from scope of garnishment, " which states as follows in its entirety:
Patricia C. Ross, individually, and Defendant Rebecca Ross Jordan, petition the Court that the personal checking account, savings account, and certificate of deposit of Patricia C. Ross be excluded from the scope of the writ of garnishment issued in this action on April 2, 2012 for the reasons stated in the affidavit of said Patricia C. Ross attached hereto.
Plaintiff's affidavit says, in pertinent part, as follows:
1.. . . Because of my age and my lack of business experience, following my husband's death, I gave to two of my daughters - Rebecca R. Jordan, who was made a party defendant in this case, and Susan R. Ross – a durable power of attorney to act on my behalf with respect to business and healthcare matters. That durable power of attorney, a copy of which is attached (Attachment 1), remains in effect.
2. For the purpose of implementing that durable power of attorney with respect to my personal checking account at Citizens Bank of Blount County, Tennessee (CBBC), my personal savings account at CBBC, and my certificate of deposit at CBBC, I had the names of those two daughters included on CBBC's signature card records for those three accounts for the sole purpose of enabling them to act on my behalf regarding those accounts if I should be unable to do so.
3.Neither of my two daughters named in the durable power of attorney put any money into any of those CBBC accounts, they have never taken any of the money out of those accounts, and they have always taken the position, as I have, that those are my three accounts and they are to be used for my needs and purposes only. Copies of documents that I obtained from CBBC on April 9, 2012, regarding the history of those accounts, which are consistent with and are submitted in further support of this affidavit, are attached[.]
4.CBBC informed me on April 9, 2012, that as of that date (April 9) the balance in the CBBC checking account is $2, 169.46, the balance in the CBBC savings account is $25, 154.53, and the balance in the certificate of deposit is $3, 077.66.
5.CBBC mailed to me on April 3, 2012, a copy of a Writ of Garnishment issued in this case on April 2, 2012. CBBC also has informed me that it has put a hold on all of the funds in my CBBC checking account, my savings account, and my certificate of deposit referred to above because my daughter Rebecca R. Jordan's name is on the CBBC records regarding those accounts and the Writ of Garnishment served on it includes her name.
6.As stated in paragraphs 1 through 3 above, there was never an intent by me or either of my daughters to whom I gave the durable power of attorney that either of them be the owners of any interest in any of those three account[s], and that their names were included on the CBBC records regarding those accounts for the sole purpose of enabling them to act on my behalf if I should [be] unable to do so for any reason.
On May 16, 2012, the federal court entered an order denying plaintiff's petition, ruling in pertinent part as follows:
Patricia C. Ross has filed a Petition to Exclude, in which she moves the Court to exclude her checking account, savings account, and certificate of deposit from the scope of the Writ of Garnishment served on Citizens Bank of Blount County in this case. The [creditor] seeks to garnish these accounts based upon the multi-million dollar Judgment in his favor entered in this case against the Defendants, including Ms. Rebecca Ross Jordan. Both Ms. Ross and Ms. Jordan are listed as account owners on these accounts.
In support of her request for relief from garnishment, Ms. Ross states that she added her two daughters . . . to these accounts based upon her age and lack of business experience. Ms. Ross states that neither of her daughters has put money into or taken money out of these accounts.
The [creditor] responds that the Petition should be summarily denied because it is insufficient on its face and cites no authority to support its requested relief. The [creditor] argues that the accounts at issue are properly subject to ...