Advanced Recovery Systems v. American Agencies et al

Filing 576

MEMORANDUM DECISION AND ORDER denying Objections (Docket Entries 562 and 563 ) to Writ of Garnishment. Signed by Magistrate Judge Brooke C. Wells on 4/15/2019. (eat)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH, CENTRAL DIVISION
ADVANCED RECOVERY SYSTEMS, LLC,
Plaintiff/Counterclaim
Defendant,

MEMORANDUM DECISION AND
ORDER DENYING OBJECTIONS TO
WRIT OF GARNISHMENT

v.

Case No. 2:13-cv-00283-DAK-BCW

AMERICAN AGENCIES, LLC, et al.,

District Judge Dale A. Kimball

Defendants/Counterclaim Magistrate Judge Brooke C. Wells
Plaintiff.

This matter was referred to the undersigned by District Judge Dale A. Kimball pursuant
to 28 U.S.C. ⸹ 636(b)(1)(A).1 Pending before the court are Counter Defendant Brent Sloan’s
Reply to Writ of Execution and Request for Hearing2 and Objection of Party Claiming Interest in
Property Subject to Writ and Request for Hearing.3 The court held oral argument on March 14,
2019.4 Having considered the parties’ memoranda and arguments, the court finds the objections
to execution of the writ are not warranted. Accordingly, both motions are DENIED.
BACKGROUND
A trial by jury was held in this action in March 2017.5 A judgment was entered in favor
of Plaintiff and against multiple defendants, including Brent Sloan (“Sloan”), on May 4, 2017. 6

1

ECF No. 505.

2

ECF No. 562.

3

ECF No. 563.

4

ECF No. 571. Shawna Sloan did not personally attend the hearing, but her counsel was present.

5

ECF Nos. 438 and 439.

6

ECF No. 462.

A Revised Judgment was entered on December 1, 2017, wherein Sloan was jointly and severally
liable for $3,139, 544.96 and individually liable for $315, 325.00.7 Plaintiff proceeded to file
writs of garnishment against the judgement debtors, including Sloan. The writ against Sloan
seeks to execute on stock of the Kid to Kid Franchise System, Inc. to satisfy the judgment. The
undersigned held a supplemental hearing on January 24, 2018.8 Thereafter, Plaintiff filed
Applications for Writ of Continuing Garnishment against Sloan.9 The Clerk of Court issued the
Writ of Execution on November 8, 2018,10 and the objections currently before the court
followed.11
DISCUSSION
Pursuant to Rule 69(a)(1) of the Federal Rules of Civil Procedure,
A money judgment is enforced by a writ of execution, unless the court directs otherwise.
The procedure on execution–and in the proceedings supplementary to and in aid of
judgment or execution–must accord with the procedure of the state where the court is
located, but a federal statute governs to the extent it applies.
The Utah Rules of Civil Procedure set forth the procedures for writs of execution in Rules 64
and 64E. Sloan and Shawna Sloan argue the application for writ does not comply with the
requirements set forth in Rule 64E. Specifically, Sloan alleges the writ was issued improperly
because:
(1) The Court Clerk failed to attach the writ to plaintiff’s application, with a detailed
description of the property, judgment, notice of exemptions and reply form as
required by U.R.Civ.P 64(d)(2)(C);

7

Id.

8

ECF No. 544.

9

ECF No. 552 and 555.

10

ECF No. 558.

11

See ECF Nos. 562 and 563.

2

(2) The Court Clerk did not serve “any person named by the plaintiff as claiming an
interest in the property” as required by Rule 64(d)(3)(A); and
(3) the application for writ did not contain the “estimated value of the property” and
“name and address of any person known to the plaintiff to claim an interest in the
property” as required by Rule 64E.12
Shawna Sloan alleges the “items at issue in the writ are mine or have an interest in the same
which is senior to that of Plaintiff’s interest.”13 Pursuant to Rule 64E (d)(1) and (2) the court
held an evidentiary hearing to address Sloan and Shawna Sloan’s objections. The court will now
address each of the objections raised by the Sloans below.
First, the court notes the Preliminary Return of Service for Writ of Execution,14 which
contains a perjury declaration, states that on November 8, 2015, the Deputy Constable served on
Sloan the “Writ of Execution & Application for Writ of Execution, & Notice, & 2 Requests for
Hearing, & Notice of Constable Sale.”15 Thus, based on the evidence in the record, it appears
Sloan was served all the documents and forms required pursuant to Rule 64(d) (2)(C). Next,
Sloan argues the writ lacks a “description of the property.” However, the writ describes the
property to be seized as “[a]ny and all stock (whether certified or uncertified) owned by Brent
Sloan in Kid to Kid Franchise System, Inc., . . . as well as certain debt of Sloan entered jointly
and severally, . . . in the amount of $3,139, 544.96, . . . minus any credit of payments received,
and including applicable post-judgment interest, through November 6, 2018, is at least $2,609,
449.32 and judgment entered against Sloan for his unshared liability . . . in the amount of
$315,325.00 . . . including applicable post-judgment interest, is at least $320,083.38[.]”16

12

See ECF No. 562.

13

See ECF No. 563.

14

ECF No. 565.

15

Id.

16

See ECF No. 558.

3

Accordingly, the Judgement Debtor has specifically identified the property to be sold—the stock
needed to pay of the Judgment. Nevertheless, Sloan argues the description of the property is not
sufficient because the actual value of the stock is not included. But this is a private not publicly
traded company thus the fair market value of the stock is unknown until an actual public sale of
the stock occurs. It is possible that all of the stock may need to be sold to cover the Judgment.
Finally, Sloan argues the Clerk did not serve “other persons claiming to have interest in the
property,” such as his wife Shawna Sloan. However, a review of the tax returns for both Sloan
and Kid to Kid Franchise System, Inc., from 2013 through 2017 show Brent Sloan is the sole
shareholder.17 His wife is not referenced anywhere. Thus, based on the evidence in the record, it
appears the only person who has an interest in the property is Sloan. Even if this argument was
valid, Shawna Sloan both filed an objection to the writ, thus it appears she received notice of the
writ and was thus not prejudiced. The Sloans did not provide any information regarding other
persons having an interest in the property. Based on the foregoing, the court finds the Writ of
Execution was appropriately issued by the Court Clerk and served on Sloan.
ORDER
For the reasons set forth above the Court DENIES the Sloans’ objections, ECF Nos. 562
and 563.
DATED this 15th day of April, 2019.

Brooke C. Wells
United States Magistrate Judge

17

See ECF No. 564-1 at 2-17.

4