Price v. State Bank and Trust Company et al

Filing 12

ORDER DENYING 5 Motion for Preliminary Injunction. Ordered by Judge Marc Thomas Treadwell on 6/8/2011. (tlh)

IN THE UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF GEORGIA
MACON DIVISION

FRAN COLSON PRICE,
Plaintiff,
v.
STATE BANK AND TRUST COMPANY,
F/K/A SECURITY BANK OF JONES
COUNTY, THAD G. CHILDS, JR., AND
V.J. ADAMS, JR.,
Defendants.

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CIVIL ACTION NO. 5:11-CV-222 (MTT)

ORDER
This matter is before the Court on the Plaintiff’s Petition for Preliminary Injunction
(Doc. 5) (the “Petition”). At a hearing on the matter on June 6, 2011, the Court informed
the parties that it was going to treat the Petition as a request for a temporary restraining
order (“TRO”) and there were no objections. The Court, having considered the
arguments raised and the evidence presented at the hearing, denies the Petition for the
following reasons.
In this RICO action, the Plaintiff alleges that employees of Security Bank of
Jones County, now known as State Bank and Trust Company, fraudulently obtained her
signature on documents that created a $400,000 indebtedness on her then debt-free
home in Baldwin County. These loan proceeds, the Plaintiff alleges, were then used by
the Bank to allow one Shirley McKenna to purchase a farm in Washington County. At
the same time, these Bank employees fraudulently obtained her signature on a
guaranty for a loan used to purchase the Washington County farm. The loans on both

properties were one year notes and the Plaintiff claims that when those notes matured,
Bank employees forged her name on renewal notes and somehow were even able to
manufacture checks on her checking account that were used to pay the interest due
upon renewal of the notes. The Plaintiff claims that she was unaware of all this until her
new attorney’s discovery of this fraud just a few days before the hearing.
The Bank has already foreclosed on the Washington County farm and is now in
the process of confirming that foreclosure. The Bank’s first effort to foreclose on the
Plaintiff’s Baldwin County property was thwarted when the Plaintiff filed bankruptcy.
That bankruptcy was dismissed on April 27, 2011 because of the Plaintiff’s failure to file
required information. Accordingly, the Bank again commenced foreclosure proceedings
and foreclosure is scheduled for June 7, 2011.
In determining whether or not to grant a TRO, the Court must consider whether
the movant has established: “(1) a substantial likelihood of success on the merits; (2)
that irreparable injury will be suffered if the relief is not granted; (3) that the threatened
injury outweighs the harm the relief would inflict on the non-movant; and (4) that entry of
the relief would serve the public interest.” Schiavo ex rel. Schindler v. Shiavo, 403 F.3d
1223, 1225-26 (11th Cir. 2005). However, “[c]ontrolling precedent is clear that
injunctive relief may not be granted unless the [movant] establishes the substantial
likelihood of success criterion.” Id. at 1226.
Although the facts are complex, the Plaintiff’s theory, as alleged in her complaint,
essentially is that she was completely unaware that the Bank had secured an interest in
her Baldwin County property and had obtained her signature on a guaranty for the loan
used to purchase the Washington County farm. She did not learn of the fraud until
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barely a week before the hearing. Whatever may have happened in the Plaintiff’s
dealings with the Bank, and those dealings raise some questions, it is clear that the
Plaintiff has not established that she was unaware that her property had been
encumbered in connection with the purchase of the Washington County farm. For
example, a Bank employee played in Court a voice mail message left by the Plaintiff in
January, 2011 in which she discussed the loan and her desire to pay the loan off.
Moreover, the Plaintiff was far from a stranger to the Washington County farm.
The Plaintiff admitted that she negotiated for the purchase of the Washington County
farm as part of a section 1031 tax free exchange. The primary purpose for purchasing
the farm was to provide a home for her ill son. For reasons unclear, the Plaintiff
planned that the Washington County farm would be purchased by McKenna, the wife of
a former employee of the Plaintiff. As it turned out, and although the Plaintiff denies any
knowledge of this, McKenna did purchase the property, using the proceeds of the loan
secured by the Plaintiff’s Baldwin County property, and the Plaintiff’s son lived on and
farmed the property until his death on March 6, 2010. In other words, the transaction
unfolded much as the Plaintiff planned, although the section 1031 exchange was not
completed.
While it may well be that the Plaintiff was somehow defrauded, it is clear that the
Plaintiff was not defrauded in the manner she alleged in her complaint. Accordingly,
she has not carried her burden to establish that she is entitled to injunctive relief.

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For the foregoing reasons the Petition (Doc. 5) is DENIED.
SO ORDERED, this the 8th day of June, 2010.

S/ Marc T. Treadwell
MARC T. TREADWELL, JUDGE
UNITED STATES DISTRICT COURT

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