Franklin Leroy Stephens v. Hazel Colley ( 2014 )

REL: 08/15/2014
Notice: This opinion is subject to formal revision before publication in the advance
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SUPREME COURT OF ALABAMA
SPECIAL TERM, 2014
____________________
1130609
____________________
Franklin Leroy Stephens
v.
Hazel Colley
Appeal from Pike Circuit Court
(CV-13-900180)
STUART, Justice.
Franklin Leroy Stephens, the defendant below, appeals
from an order of the Pike Circuit Court granting injunctive
relief to the plaintiff below, Hazel Colley. We reverse and
remand.
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I.
In late 2011, Sara Frances Dees was residing at Troy
Health and Rehabilitation Center following the amputation of
her second leg as a result of diabetes and related circulation
issues. On approximately January 15, 2012, Stephens –– a
nephew of both Dees and Colley –– checked Dees out of the
rehabilitation center and moved her back into her house in
Troy. Stephens and an unidentified female companion also
moved into the house and began caring for Dees. Colley
alleges that Stephens thereafter began restricting access to
Dees, preventing Colley and Dees's friends from speaking with
her on the telephone or visiting with her outside his or his
female companion's presence. Colley, who lives in Opelika,
alleges that she had previously had a close relationship with
her sister and had stayed with her for weeks at a time to help
with her medical needs; however, she alleges, once Stephens
moved into Dees's house Stephens would no longer allow her to
stay with Dees overnight.
Over the course of 2012, Stephens's role in Dees's life
continued to increase. In September 2012, Stephens scheduled
two separate appointments for Dees with an attorney. At the
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first of those appointments on September 26, 2012, Dees
executed a durable power of attorney designating Stephens as
Dees's attorney-in-fact. At a second appointment on September
28, 2012, Dees executed a new will naming Stephens as executor
and primary heir of her estate. These newly executed
documents replaced a previous durable power of attorney naming
Colley as Dees's attorney-in-fact and a will naming Colley as
executor and primary heir of Dees's estate, both of which Dees
had executed in July 2011.1
Beginning in October 2012, Stephens also began taking
Dees to the various financial institutions at which she had
deposits and requesting that he either be added to all her
accounts as a signatory or be named as the beneficiary on the
accounts. The evidence in the record indicates that multiple
bank employees involved in those requests were alarmed by
Stephens's actions. For example, Kathryn Faircloth, a
personal banker at Troy Bank and Trust, made the following
statement in an affidavit submitted to the trial court:
1
Dees had also executed a document naming Colley as her
health-care proxy in July 2011. There is no evidence
indicating that this document was subsequently revoked or
superseded by a later document.
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"Mrs. Sara Dees has banked with Troy Bank and
Trust for many years. In working with her on her
banking needs, I met her sister, Hazel Colley, and
have spoken with each of them often regarding Mrs.
Dees checking accounts as well as several
certificates of deposit. Mrs. Dees executed a power
of attorney which named Mrs. Colley as her attorney-
in-fact and supplied a copy of that to the bank.
Mrs. Dees listed Hazel Colley as joint owner on her
personal checking account and also as a pay-on-death
beneficiary on certain certificates of deposit.
Even when Mrs. Dees married Marion Dees, Hazel
Colley remained on her checking account and some
certificates of deposit as pay-on-death.[2] Marion
was on the checking account for a period of time and
then came off but Hazel remained on the checking
account.
"Mrs. Dees was brought to the bank by Leroy
Stephens in 2012, who stated that he was to be added
as beneficiary of every financial instrument held by
Mrs. Dees at [Troy Bank and Trust]. This included
all of her certificates of deposit and her checking
account. Mrs. Dees's appearance was drastically
different from how she appeared in our interactions
through the years. She did not appear alert or
fully aware of the changes stated by Stephens. This
was very out of character for Mrs. Dees because she
always listed her sister Mrs. Colley as beneficiary
on all of her certificates of deposit, even when she
was married to Marion Dees. Mr. Stephens was so
adamant to make these changes to Mrs. Dees's
accounts that he called me regularly wanting to know
when the paperwork on all certificates of deposit
2
The record indicates that Marion Dees died shortly after
Sara Dees, but it is otherwise silent regarding him and his
relationship with Dees. It is not clear whether he lived with
Sara Dees and Stephens throughout 2012 or whether he lived
somewhere else. However, it appears that he was not involved
in her life during this time, whether for health, personal, or
other reasons.
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and bank accounts would be completed and ready for
Mrs. Dees's signature.
"I grew concerned while making these changes
because I noticed several large checks clearing out
of her checking account. Each of the large checks
were made payable to Leroy Stephens, most of them
with the memo listed as 'bills.' Checks were also
clearing her account for her bills in addition to
these large checks made payable to Mr. Stephens. I
immediately notified my supervisor of the large
checks clearing her account that were abnormal from
her typical usage. My supervisor then consulted the
bank's security officer, who advised that absent any
order from a judge that declared Mrs. Dees not
competent, we could not refuse to add Stephens to
her accounts or cash checks she signed made payable
to Mr. Stephens."
It appears that Stephens was thereafter successfully added as
a signatory or beneficiary to all of Dees's accounts.
On February 16, 2013, Dees passed away. Thereafter,
Stephens began exercising control of those accounts on which
he had been listed as the payable-on-death beneficiary. The
value of those accounts appears to have exceeded $300,000 at
that time. On February 22, 2013, Stephens submitted Dees's
will to the Pike Probate Court and petitioned the probate
court to name him executor of Dees's estate consistent with
the terms of that will; on March 1, 2013, the probate court
granted that petition. On March 8, 2013, Colley separately
moved both the probate court and the Pike Circuit Court to
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have the administration of Dees's estate removed to the
circuit court. Colley simultaneously moved the circuit court
to remove Stephens as the executor of Dees's estate pursuant
to § 43-2-22(a), Ala. Code 1975, because Stephens had been
convicted in 1990 of manslaughter.3 On April 17, 2013, the
circuit court granted Colley's motion and ordered the
administration of Dees's estate removed to the circuit court.
Following a hearing on April 24, 2013, the circuit court also
granted Colley's motion to remove Stephens as executor of
Dees's estate. Pursuant to the terms of Dees's will,
Stephens's daughter, Sonya S. Bolling, was eventually named as
successor executrix of Dees's estate.
On August 26, 2013, Colley filed an amended complaint
seeking to set aside the power of attorney and will executed
by Dees in 2012, alleging that Dees was incompetent at the
time those documents were executed and that Stephens had
3
Section 43-2-22(a) provides, in pertinent part:
"No person must be deemed a fit person to serve as
executor who is under the age of 19 years, or who
has been convicted of an infamous crime, or who,
from intemperance, improvidence or want of
understanding, is incompetent to discharge the
duties of the trust."
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procured them via fraud, misrepresentation, and undue
influence.4 On October 30, 2013, Colley initiated a new
action asserting multiple undue-influence and breach-of-
fiduciary-duty claims against Stephens. Colley simultaneously
moved the circuit court to exhume Dees's remains and to
consolidate this new action with the already existing action;
the circuit court granted the motion to consolidate the next
day.
Colley thereafter continued the discovery process, taking
depositions and subpoenaing Dees's financial records. On
February 19, 2014, after obtaining and reviewing those
records, Colley moved the circuit court to enter a temporary
restraining order barring Stephens from spending any further
money that he had obtained from Dees's accounts or taking any
action that would affect the title to Dees's house, in which
Stephens continued to live after Dees's death. Colley also
requested that Stephens be ordered to divulge where all assets
formerly held by Dees were located and that Troy Bank and
Trust and Wells Fargo be ordered to pay all funds in Dees's
4
Colley's March 2013 motion to remove Dees's estate to the
circuit court appears to have been treated as a complaint
initiating an action even though it did not formally assert
any cause of action.
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accounts, which were then held in Stephens's name, an amount
totaling approximately $72,000, into the circuit court.
Colley simultaneously moved the circuit court to enter a
preliminary injunction extending the terms of the temporary
restraining order until this litigation was resolved. The
circuit court issued the requested temporary restraining order
that same day and set a hearing on the motion for a
preliminary injunction for February 24, 2014.
Following the February 24 hearing, which consisted
entirely of arguments by counsel, Colley, on February 26,
submitted a supplemental motion for injunctive relief to the
circuit court, along with various affidavits and other
documentary evidence. On February 27, 2014, the circuit court
entered an order granting Colley the injunctive relief she had
sought, stating:
"Having considered [Colley's] motion for
injunctive relief, this court finds said motion well
taken. Accordingly, it is ordered that all funds
not previously frozen or transferred in accordance
with the temporary restraining order issued on
February 19, 2014, from Troy Bank and Trust in Troy,
Alabama, Wells Fargo Advisors in Troy, Alabama, and
Trustmark National Bank in Brewton, Alabama,[5] in
5
Colley's initial application for injunctive relief filed
on February 19, 2014, identified only financial accounts held
by Stephens at Troy Bank and Trust and Wells Fargo. At the
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the name of Leroy Stephens be immediately paid to
the Circuit Clerk of Pike County, Alabama, who is
ordered to hold said funds until a final judgment is
entered in the above styled case.
"It is further ordered that neither the Estate
of Sara Dees nor Leroy Stephens shall transfer
title, rent, lease, or dispense of the real property
located at ... Avenue, Troy, Alabama, and that the
aforementioned property shall remain in the name of
Sara Dees, pending a final judgment in this matter.
"Defendant Franklin Leroy Stephens is barred
from transferring, selling, or dispensing of any
property received from Dees during her lifetime, and
is further ordered to provide a complete accounting
of assets obtained through the estate of Sara
Frances Dees at the time of her death, including but
not limited to: the 2010 Pontiac vehicle
transferred to [Stephens] prior to Dees's death, all
furnishings of Dees's home, all jewelry owned by
Dees, and personal items of value.
"A copy of this order shall be provided to all
counsel of record and to the below listed banks."
On March 7, 2014, Stephens filed a notice of appeal to this
Court challenging the preliminary injunction entered by the
circuit court.6
February 24, 2014, hearing, Colley advised the trial court of
another account maintained by Stephens at Trustmark National
Bank.
6
Also on March 7, 2014, the trial court modified the terms
of the February 27 preliminary injunction to make it subject
to Colley's posting a $2,500 security bond.
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II.
"When this Court reviews the grant or denial of
a preliminary injunction, '"[w]e review the ...
[c]ourt's legal rulings de novo and its ultimate
decision to issue the preliminary injunction for [an
excess] of discretion."' Holiday Isle, LLC v.
Adkins, 12 So. 3d 1173, 1176 (Ala. 2008) (quoting
Gonzales v. O Centro Espirita Beneficente Uniao do
Vegetal, 546 U.S. 418, 428, 126 S. Ct. 1211, 163
L. Ed. 2d 1017 (2006))."
Monte Sano Research Corp. v. Kratos Defense & Sec. Solutions,
Inc., 99 So. 3d 855, 861-62 (Ala. 2012).
III.
When reviewing a preliminary injunction, this Court must
consider both whether the evidence in the record supports the
issuance of the preliminary injunction and whether the form of
the preliminary-injunction order itself complies with the
requirements of Rule 65(d)(2), Ala. R. Civ. P. We review the
evidence to determine whether the following elements set forth
in Perley ex rel. Tapscan, Inc. v. Tapscan, Inc., 646 So. 2d
585, 587 (Ala. 1994), were established:
"In order for a trial court to grant a
preliminary injunction, the plaintiff must show all
of the following: 1) that without the injunction
the plaintiff would suffer immediate and irreparable
injury; (2) that the plaintiff has no adequate
remedy at law; (3) that the plaintiff has at least
a reasonable chance of success on the ultimate
merits of his case; and (4) that the hardship
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imposed on the defendant by the injunction would not
unreasonably outweigh the benefit accruing to the
plaintiff."
(Citing Martin v. First Fed. Sav. & Loan Ass'n of Andalusia,
559 So. 2d 1075 (Ala. 1990); Board of Dental Exam'rs of
Alabama v. Franks, 507 So. 2d 517 (Ala. Civ. App. 1986), writ
quashed, 507 So. 2d 521 (Ala. 1987)). Rule 65(d)(2) meanwhile
sets forth the elements that every preliminary-injunction
order must contain:
"Every order granting an injunction shall set forth
the reasons for its issuance; shall be specific in
terms; shall describe in reasonable detail, and not
by reference to the complaint or other document, the
act or acts sought to be restrained; and is binding
only upon the parties to the action, their officers,
agents, servants, employees, and attorneys, and upon
those persons in active concert or participation
with them who receive actual notice of the order by
personal service or otherwise."
On appeal, Stephens argues both that Colley failed to
establish by competent evidence the four elements set forth in
Perley and that the circuit court's preliminary-injunction
order does not comply with Rule 65(d)(2). In this case, it is
clear on its face that the circuit court's order does not
comply with Rule 65(d)(2). Accordingly, we need not consider
whether the evidence ultimately supports the issuance of the
preliminary injunction because the order is due to be reversed
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regardless of whether the evidence supports the issuance of
the injunction. See Marathon Constr. & Demolition, LLC v.
King Metal Recycling & Processing Corp., 129 So. 3d 272, 276
n. 3 (Ala. 2013) ("The defendants make other complaints about
the trial court's November 28, 2012, order .... Because the
trial court's failure to comply with the requirements of Rule
65 is dispositive, we need not reach the other arguments.").
"Pursuant to Rule 65, it is mandatory that a
preliminary-injunction order give reasons for the issuance of
the injunction, that it be specific in its terms, and that it
describe in reasonable detail the act or acts sought to be
restrained." Monte Sano Research Corp., 99 So. 3d at 863.
The February 27, 2014, order in this case is sufficiently
specific in its terms and describes in reasonable detail the
acts sought to be restrained; however, it contains no
explanation of the reasons for its issuance. Instead, the
order opens by stating that the court has "considered
[Colley's] motion for injunctive relief [and] finds said
motion well taken." Then the order immediately proceeds to
detail the specific acts that it requires or prohibits. What
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is missing from the order is any discussion of the reasons
Colley's motion for injunctive relief was "well taken."
In her brief to this Court, Colley acknowledges this flaw
in the order but argues that the preliminary injunction is
nevertheless due to be upheld:
"While the order does not specifically state the
reasons for granting the injunction, the order does
state that 'having considered plaintiff's motion for
injunctive relief, this court finds said motion well
taken,' a clear sign that the trial court has
considered all evidence and is granting [Colley's]
motion for the reasons stated and evidence provided
in [her] motion for injunctive relief and
supplemental motion for injunctive relief, and the
arguments raised at the motion for injunctive relief
hearing."
Colley's brief, at p. 23. However, accepting this argument
would require us to ignore the clear language of Rule
65(d)(2), and we are not inclined to do so. "This Court has
repeatedly held that the language of Rule 65(d)(2) is
mandatory and requires that an order issuing a preliminary
injunction state reasons for issuing the injunction and that
it be specific in its terms." Butler v. Roome, 907 So. 2d
432, 434 (Ala. 2005). Moreover, we have repeatedly reaffirmed
the mandatory nature of Rule 65(d)(2) in every case in which
we have considered the issue. See, e.g., Marathon Constr. &
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Demolition, 129 So. 3d at 279 (concluding that the trial court
"exceeded the scope of its discretion in issuing the ...
preliminary injunction because it did not comply with the
requirements set forth in Rule 65"); Monte Sano Research
Corp., 99 So. 3d at 863 ("[A]n examination of the trial
court's order reveals that it violated Rule 65(d)(2), Ala. R.
Civ. P., by failing to provide the reasons for the issuance of
the injunction ...."); Walden v. ES Capital, LLC, 89 So. 3d
90, 111 (Ala. 2011) ("Because the reasons for the issuance of
the injunction were clearly indicated on the face of the order
and because those reasons were, as demonstrated by the present
case, well founded, we reject [the appellant's] contentions
that the trial court's order fails to satisfy the mandatory
requirements of Rule 65(d)(2)."); and Hall v. Reynolds, 27 So.
3d 479, 481 (Ala. 2009) ("Although the trial court may have
intended to grant injunctive relief by simply entering a
judgment in favor of the [appellees], it did not do so, and it
followed none of the mandatory requirements of Rule 65(d)(2),
Ala. R. Civ. P."). In sum, the circuit court's failure to
include in the preliminary-injunction order the reasons for
granting Colley's motion for injunctive relief requires the
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reversal of that order regardless of the fact that the circuit
court presumably had its reasons for granting the order,
though those reasons were not articulated in the order.
IV.
Following the entry of a preliminary injunction against
him by the circuit court, Stephens appealed to this Court,
arguing that the order entering the preliminary injunction was
invalid because, he said, it failed to comply with Rule
65(d)(2) and was due to be reversed because, he alleged, it
was not supported by competent evidence. Because the circuit
court failed to state its reasons for entering the preliminary
injunction in the order doing so, the order must be reversed
for noncompliance with Rule 65(d)(2). This noncompliance
obviates the need to consider Stephens's other argument that
there was insufficient evidence before the circuit court to
merit the entry of a preliminary injunction. We further note,
however, that our holding in this regard should not be
construed as precluding Colley from requesting that the
circuit court again issue a preliminary injunction should she
still deem such an injunction advisable. Any such injunction
that might be entered, however, is subject to further review
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to determine its compliance with Rule 65(d)(2), as well as to
determine whether competent evidence exists to conclude that
the elements set forth in Perley were established.7
REVERSED AND REMANDED.
Moore, C.J., and Parker and Wise, JJ., concur.
Shaw, J., concurs in the result.
7
In other words, this case is distinguishable from
Bankruptcy Authorities, Inc. v. State, 620 So. 2d 626 (Ala.
1992), in which this Court, after reversing an order entering
a preliminary injunction for failure to comply with Rule
65(d)(2), declined to consider in a subsequent appeal whether
there was sufficient evidentiary support for a newly entered
and Rule 65(d)(2)-compliant preliminary injunction because the
appellant had not asserted a sufficiency-of-the-evidence
argument in its initial appeal decided on Rule 65(d)(2)
grounds.
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SHAW, Justice (concurring in the result).
The preliminary-injunction order in this case does not
explicitly state the reasons for its issuance; instead, it can
be read to incorporate, by reference, the reasons provided in
Hazel Colley's motion for injunctive relief.
Rule 65(d)(2), Ala. R. Civ. P., states that an "order
granting an injunction shall set forth the reasons for its
issuance ...." I am concerned that this language does not
necessarily preclude incorporating those reasons from another
document. Specifically, I note that Rule 65(d)(2) only
explicitly forbids incorporation by reference of a description
of the acts to be restrained: "[the order] shall describe in
reasonable detail, and not by reference to the complaint or
other document, the act or acts sought to be restrained ...."
On the other hand, the rule states that the "reasons for its
issuance" are to be "set forth," but this requirement does not
include a prohibition on referring to another document.
Because there is an explicit prohibition on referring to
other documents as to one component of the order (the act
sought to be restrained), but not another (the reasons for its
issuance), one could reasonably conclude that reference to
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another document might be acceptable for the latter.8 Such a
distinction is reasonable: the party restrained by the
injunction needs to know precisely what acts are or are not
permitted; thus, the issuing court should independently state
the restrictions to ensure that they are clear.9 However, a
party does not, necessarily, need the issuing court to
independently describe the reasons for the injunction. An
appellate court is more than able to review in the record any
documents referred to that might provide the issuing court's
reasons. Under this analysis, the trial court's order in the
instant case is sufficient to comply with Rule 65(d)(2).
The caselaw, however, is not on my side. See, e.g.,
Monte Sano Research Corp. v. Kratos Defense & Sec. Solutions,
Inc., 99 So. 3d 855, 863 (Ala. 2012) ("[A]n examination of the
trial court's order reveals that it violated Rule 65(d)(2),
Ala. R. Civ. P., by failing to provide the reasons for the
issuance of the injunction ...."); Butler v. Roome, 907 So. 2d
8
Because Rule 65 is a rule of this Court, I do not believe
that separation-of-powers concerns require us to apply the
plain-language rule of statutory construction.
9
See also Rule 65(d)(1), which provides that the acts to
be restrained by a restraining order shall be "describe[d] in
reasonable detail, and not by reference to the complaint or
other document ...."
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432, 435 (Ala. 2005) ("[T]he trial court's order in this case
does not contain the reasons for its issuance ...."); and
Teleprompter of Mobile, Inc. v. Bayou Cable TV, 428 So. 2d 17,
20 (Ala. 1983) ("It is apparent the order does not comply with
Rule 65(d)(2). There are no reasons given for the issuance of
the preliminary injunction ....").10 These precedents are not
challenged on appeal; therefore, stare decisis advises me to
follow them. Moore v. Prudential Residential Servs. Ltd.
P'ship, 849 So. 2d 914, 926 (Ala. 2002) ("Stare decisis
commands, at a minimum, a degree of respect from this Court
that makes it disinclined to overrule controlling precedent
when it is not invited to do so."), and Clay Kilgore Constr.,
Inc. v. Buchalter/Grant, L.L.C., 949 So. 2d 893, 898 (Ala.
2006) (noting the absence of a specific request by the
appellant to overrule existing authority and stating that,
"[e]ven if we would be amenable to such a request, we are not
10
As to this point, the decision in Marathon Construction
& Demolition, LLC v. King Metal Recycling & Processing Corp.,
129 So. 3d 272 (Ala. 2013), cited in the main opinion, was
joined by only four Justices: As to "that part of the
discussion that addresses the lack of compliance with Rule
65(d)(2), Ala. R. Civ. P.," I expressed no opinion. 129 So.
3d at 280 (Shaw, J., concurring in part and concurring in the
result). My concerns in Marathon were those I express now.
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inclined to abandon precedent without a specific invitation to
do so"). I therefore concur in the result.
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