United States Fidelity and Guaranty Company v. Armstrong et al

Filing 7

ORDER re 2 APPLICATION for Preliminary Hearing filed by United States Fidelity and Guaranty Company. Although USF&G has not requested a temporary restraining order, the nature of the allegations and the relief requested indicate to the court that t ime is of the essence. However, the Armstrongs have not yet been served. Accordingly, the court ADVISES the plaintiff that the Magistrate Judge lacks the authority to decide any of the issues in this case without the consent of all of the parties. Thus, as soon as service is perfected upon the defendants, USF&G should notify the Clerk of the court whether it intends to consent to the Magistrate Judge, provided however, that no notice is sent to the undersigned judge. When service is perfected, the court will issue a similar directive to the defendants. Signed by Judge Vanzetta P. McPherson on 5/3/2006. (dmn)

United States Fidelity and Guaranty Company v. Armstrong et al

Doc. 7

Case 2:06-cv-00372-WHA-WC

Document 7

Filed 05/03/2006

Page 1 of 2

IN THE UNITED STATES DISTRICT COURT F O R THE MIDDLE DISTRICT OF ALABAMA N O R T H E R N DIVISION U N IT E D STATES FIDELITY AND G U A R A N T Y COMPANY, ) ) ) P l a i n t if f , ) ) v. ) ) E L M E R MYERS ARMSTRONG, et al., ) ) D e f e n d a n ts . )

C I V IL ACTION NO. 2:06CV372-VPM [W O ]

O R D E R ON MOTION
P e n d in g before the court is the plaintiff's Application For Preliminary Hearing, filed o n 24 April 2006 (Doc. # 2). USF&G, the plaintiff, alleges that the defendants [hereinafter " th e Armstrongs"] have failed to assume their obligations and duties under a Master Surety A g re e m e n t and General Contact of Liability regarding the issuance of certain bonds on b e h a lf of Price Oil Company. The Armstrongs's agreed "to exonerate, defend and hold U S F & G harmless from any loss, cost or expense which might result from the issuance of any o f the" bonds (Doc. # 2, p. 3). Price Oil's recent filing of a voluntary petition for Chapter 1 1 relief in bankruptcy court (MD-AL) has triggered USF&G's lawsuit. T h e plaintiff believes that (1) the Armstrongs and Price Oil are in the process of liq u id a tin g and selling "a significant portion" of their assets, and (2) as a result, the A rm s tr o n g s ' s assets may be insufficient to honor their agreement "to provide for the reim b u rsem en t, exoneration and indemnification of USF&G, as surety" (Doc. # 2, p. 4). U S F & G requests a preliminary injunction to enjoin the Armstrongs from selling or

Dockets.Justia.com

Case 2:06-cv-00372-WHA-WC

Document 7

Filed 05/03/2006

Page 2 of 2

tra n sfe rrin g any property valued at more than $1,000, the imposition of a judicial lien in its fav o r, and, significantly, an accounting from the Armstrongs within 10 days.1 The plaintiff a ls o wishes to have the court marshal and sequester the Armstrongs's assets, to order them to deposit assets with USF&G to secure its anticipated losses. A lth o u g h USF&G has not requested a temporary restraining order, the nature of the alleg atio n s and the relief requested indicate to the court that time is of the essence. However, th e Armstrongs have not yet been served. Accordingly, the court ADVISES the plaintiff that the Magistrate Judge lacks the a u t h o r ity to decide any of the issues in this case without the consent of all of the parties. T h u s, as soon as service is perfected upon the defendants, USF&G should notify the Clerk o f the court whether it intends to consent to the Magistrate Judge, provided however, that no n o tic e is sent to the undersigned judge. When service is perfected, the court will issue a s im ila r directive to the defendants. D O N E this 3 rd day of May, 2006.

/s / Vanzetta Penn McPherson V A N Z E T T A PENN MCPHERSON U N IT E D STATES MAGISTRATE JUDGE

USF&G did not provide a precise deadline in its complaint. Thus the court is u n c le a r whether the plaintiff expects the 10-day period to run from the filing of the c o m p la in t, the date of service upon the defendants, the filing of an Answer, or another d a te .

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