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Gibson v. Wells Fargo Bank, N.A.

Florida Court of Appeals, Second District

July 13, 2018

JAMES J. GIBSON and LORI G. GIBSON, Appellants,
v.
WELLS FARGO BANK, N.A., as successor by merger to Wachovia Bank, Appellee.

         NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED

          Appeal from the Circuit Court for Hillsborough County; Robert A. Foster, Jr., Judge.

          Jennifer E. Jones of McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A., Tampa; and Shyamie Dixit and Robert L. Vessel of the Dixit Law Firm, P.A., Tampa, for Appellant Lori Gibson.

          Amy J. Winarksy of Marcadis Singer, P.A., Tampa, for Appellant James J. Gibson.

         Ryan W. Owen of Adams and Reese, LLP, Sarasota, for Appellee.

          LaROSE, Chief Judge.

         Dr. Lori and James Gibson appeal the final summary judgment entered in favor of judgment creditor, Wells Fargo Bank, N.A, in proceedings supplementary. We have jurisdiction. See Fla. R. App. P. 9.030(b)(1)(A). We must determine whether, under Florida law, a creditor may satisfy a debt incurred by one spouse by garnishing a federal tax refund issued in both spouses' names and deposited in their joint checking account. Florida law compels us to conclude that the joint tax refund is tenancy by the entirety (TBE) property not subject to garnishment. Thus, we reverse.

         Background

         In December 2009, Wachovia Bank sued Mr. Gibson for breach of a promissory note that he, alone, executed in March 2008. The parties stipulated to the entry of a final judgment in favor of Wachovia for over one million dollars.

         Following entry of final judgment, the Gibsons filed amended joint federal tax returns for tax years 2003 through 2006, seeking retroactive reduction in their tax burden. See American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, at § 1211, 123 Stat. 115 (2009) (amending section 172(b)(1)(H) of the Internal Revenue Code to extend the carryback period to up to five years for 2008 net operating losses incurred by an eligible small business). Based upon these returns, the Internal Revenue Service issued two tax refund checks; one in June 2011 and the other in April 2014. Each check was payable to both Mr. Gibson and his wife, Dr. Gibson. The refund checks totaled over two million dollars. The Gibsons deposited both checks into their joint account at SunTrust Bank. The parties agree that the Gibsons held the SunTrust account as TBE property.

         In October 2014, Wells Fargo Bank, as successor by merger to Wachovia, moved to garnish the SunTrust account. Wells Fargo sought proceedings supplementary under section 56.29, Florida Statutes (2014), and moved to implead Dr. Gibson as a party. Wells Fargo alleged that it could execute on the federal tax refunds in the account to satisfy Mr. Gibson's outstanding judgment.

         The trial court granted Wells Fargo's motions for proceedings supplementary and impleader. Thereafter, Wells Fargo moved for summary judgment. The Gibsons opposed the motion and filed their own summary judgment motion, arguing that they held the joint federal tax refunds as TBE. They also maintained that the refunds related to tax years prior to execution of the 2008 promissory note.

         The trial court granted Wells Fargo's motion and denied the Gibsons' motion. The trial court found that the refunds "were attributable solely to [Mr. Gibson]'s economic activities." Further, the trial court was persuaded by Wells Fargo's argument that, because the IRS has the ability to apportion tax refunds to each individual spouse, issuance of the joint tax refund checks did not establish TBE property. The trial court entered a final summary judgment providing that Wells Fargo could recover from Dr. and Mr. Gibson "jointly and severally and as tenants by the entireties, the sum of $1, 310, 491.78" from the SunTrust Account.

         Analysis

         On appeal, the Gibsons argue that the joint tax refunds, issued in both of their names and deposited in their joint bank account, are TBE property. Therefore, Wells Fargo, a creditor to only Mr. Gibson, cannot reach those funds to satisfy his individual debt. Although they acknowledge that the IRS has statutory authority to attach TBE property in certain circumstances, the Gibsons contend that third-party ...


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