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Kearney Construction Co., LLC v. Travelers Casualty & Surety Co. of America

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

December 19, 2019

KEARNEY CONSTRUCTION COMPANY LLC, Plaintiff,
v.
TRAVELERS CASUALTY & SURETY COMPANY OF AMERICA, Defendant/Third Party Plaintiff,
v.
KEARNEY CONSTRUCTION COMPANY, LLC, et al., Third Party Defendants.

          ORDER

          HONORABLE CHRISTOPHER P. TUITE United States Magistrate Judge

         This matter is before the Court on Travelers Casualty & Surety Company of America’s Amended Motion for Proceedings Supplementary, Motion to Void Bing Kearney’s Fraudulent Transfer of His Interest in Property, Motion for Leave to File a Notice of Lis Pendens and Complaint, and Motion to Implead Clayton Kearney and Olga Kearney. (Doc. 970). The Court heard oral argument on these motions on December 2, 2019. For the reasons set forth below, Travelers’ motion is granted in part and denied in part.

         I.

         In October 2011, the Court entered Judgment in favor of Travelers and against Bing Charles W. Kearney, Jr. (Bing Kearney) and others in the amount of $3,750,000. (Doc. 244). Since then, according to Travelers, it has been unable to collect on the Judgment, despite a number of attempts to do so. As part of its ongoing collections efforts, Travelers moved in October 2019 pursuant to Federal Rule of Civil Procedure 69 and Section 56.29 of the Florida Statutes to initiate proceedings supplementary with respect to certain real property, in which Bing Kearney and his son, Clayton Kearney (Clayton), each held a 50% interest.[1] (Doc. 968). In its motion, Travelers requested permission to file a lis pendens against this property, as well as a complaint seeking a levy and sale of the property in aid of execution on the Judgment. Travelers also requested that it be allowed to implead Clayton and that Bing Kearney be enjoined from alienating his interest in the property while the proceedings supplementary were pending. Id.

         Within hours of Travelers filing its motion, Bing Kearney recorded a Quit Claim Deed transferring his interest in the property to Clayton and his wife, Olga.[2](Doc. 969-1). In his subsequent response to Travelers’ motion, Bing Kearney argued that Clayton purchased the property with insurance proceeds he received as a result of a motor vehicle accident in which he was almost killed, and that Bing Kearney’s name had been included on the title solely so that he could maintain “parental oversight” of Clayton’s management of the property while he recovered from his injuries. (Doc. 969). Bing Kearney further asserted that the property, now fully owned by Clayton and Olga, was the couple’s homestead and was therefore protected against a forced sale by the Florida Constitution. Id.

         Given the change in circumstance outlined in Bing Kearney’s response, Travelers filed the instant amended motion. (Doc. 970). In this submission, Travelers requests relief similar to that outlined in its initial motion, except that it now seeks to implead both Clayton and Olga and to void what it characterizes as Bing Kearney’s fraudulent transfer of the property to the couple.

         In response, Bing Kearney reiterates that he never held a beneficial interest in the property and that his transfer of the property to Clayton and Olga simply reflects the correct chain of title. (Doc. 976). He additionally asserts that, because his son and daughter-in-law’s homestead property is exempt from execution, Travelers should be prohibited from instituting meritless litigation against them. Id.

         II.

         Proceedings supplementary to and in aid of a judgment or execution “are a useful, efficacious, and salutary remedy at law enabling [a] judgment creditor not only to discover assets which may be subject to [its] judgment, but to subject them thereto by a speedy and direct proceeding in the same court in which the judgment was recovered.” Grovenor House, L.L.C. v. E.I. Du Pont De Nemours & Co., 2012 WL 12950042, at *2 (S.D. Fla. July 12, 2012) (italics and internal quotation marks removed). Federal Rule of Civil Procedure 69 provides that proceedings supplementary must accord with the procedure of the state where the court is located. Fed. R. Civ. P. 69(a)(1). Section 56.29 of the Florida Statutes governs such proceedings in this state.

         The purpose of that statute is to provide a mechanism “for a judgment creditor ‘to ferret out what assets the judgment debtor may have or what property of his others may be holding for him, or may have received from him to defeat the collection of the lien or claim, that might be subject to the execution.’” Longo v. Associated Limousine Servs., Inc., 236 So. 3d 1115');">236 So. 3d 1115, 1119 (Fla. Dist. Ct. App. 2018) (quoting Young v. McKenzie, 46 So. 2d 184, 185 (Fla. 1950)).

When any judgment creditor holds an unsatisfied judgment or judgment lien . . ., the judgment creditor may file a motion and an affidavit so stating, identifying, if applicable, the issuing court, the case number, and the unsatisfied amount of the judgment or judgment lien, including accrued costs and interest, and stating that the execution is valid and outstanding, and thereupon the judgment creditor is entitled to these proceedings supplementary to execution.

Fla. Stat. § 56.29(1).

         By its terms, section 56.29(1) imposes “two jurisdictional prerequisites . . . for supplementary proceedings[:] (1) an unsatisfied writ of execution, and (2) an affidavit averring that the writ is valid and unsatisfied.” Gen. Trading, Inc. v. Yale Materials Handling Corp., 119 F.3d 1485, 1496 n.22 (11th Cir. 1997). Once a movant has satisfied these two requirements, it is entitled to commence proceedings supplementary, and “the court has no discretion to deny” that relief. Longo, 236 So. 3d at 1119 (internal quotations and citations omitted).

         As Bing Kearney effectively conceded at oral argument, Travelers has met these two requirements here. It has filed the requisite affidavit attesting that it holds a valid, unsatisfied judgment and that the Clerk of Court has issued a writ of execution, which also remains valid and outstanding. (Doc. 970-2). As such, Travelers is authorized to ...


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