Villamorey, S.A. v. Bdt Investments, Inc.

Third District Court of Appeal
State of Florida
Opinion filed April 18, 2018.
Not final until disposition of timely filed motion for rehearing.
________________
No. 3D17-1952
Lower Tribunal No. 17-4616
________________
Villamorey, S.A.,
Appellant,
vs.
BDT Investments, Inc.,
Appellee.
An Appeal from a non-final order from the Circuit Court for Miami-Dade
County, Jose M. Rodriguez, Judge.
Sequor Law, P.A., and Edward H. Davis, Jr. and Annette C. Escobar, for
appellant.
Carey Rodriguez Milian Gonya, LLP, and Amy M. Bowers-Zamora and
David M. Levine, for appellee.
Before LAGOA, EMAS and SCALES, JJ.
SCALES, J.
Villamorey, S.A., a Panamanian company claiming an interest in property
subject to the garnishment proceedings below, appeals the trial court’s non-final
order denying Villamorey’s motion for protective order.1 We affirm the order on
appeal because Villamorey was properly made a party to the garnishment
proceedings.
I. RELEVANT FACTS AND PROCEDURAL BACKGROUND
Appellee, BDT Investments, Inc. (“BDT”), obtained a Panamanian
judgment against Lisa, S.A. (“Lisa”), and subsequently filed an action in the circuit
court below to domesticate the foreign judgment. Upon learning that the Miami
branch of Banco Santander International (“Bank”) may be holding, in a Villamorey
account at Bank, over $13 million in funds allegedly owed to Lisa by Villamorey,
BDT served Bank with a writ of garnishment.
Bank responded by answering the writ and moving to dismiss the writ. In its
answer, Bank generally denied the writ’s allegations, and identified Villamorey as
the account holder.2 Pursuant to section 77.06(3) of the Florida Statutes (2017),3
1 We have appellate jurisdiction because the discovery order determines that the
trial court has personal jurisdiction over Villamorey. See Fla. R. Civ. P.
9.130(a)(3)(C)(i); Hitt v. Homes & Land Brokers, Inc., 993 So. 2d 1162, 1165 (Fla.
2d DCA 2008) (“[A] nonfinal order that determines jurisdiction over the person is
appealable.”).
2Bank also asserted that the funds in Villamorey’s account had been pledged to
Bank to secure a loan Bank had made to Villamorey.
3 This provision states, in relevant part, as follows:
In any case where a garnishee in good faith is in doubt as to whether
any indebtedness or property is required by law to be included in the
garnishee’s answer or retained by it, the garnishee may include and
2
however, Bank’s answer specifically alleged that Bank was in doubt as to whether
the Villamorey account was subject to BDT’s garnishment writ; thus, Bank froze
the Villamorey account.4
BDT replied to Bank’s answer to the writ of garnishment, attaching an
independent report prepared for Villamorey that audited Villamorey’s financial
statements. BDT contended that the audit report evidenced a dividend in excess of
$13 million declared by Villamorey and payable to Lisa, Villamorey’s minority
shareholder. BDT claimed that these dividend funds, held in the Villamorey
account at Bank, actually belonged to Lisa, and therefore were subject to BDT’s
garnishment. Pursuant to section 77.055 of the Florida Statutes (2017),5 BDT
retain the same, . . . subject to disposition as provided in this chapter. .
..
§ 77.06(3), Fla. Stat. (2017).
4 Bank’s motion to dismiss the writ was premised primarily on BDT’s alleged
failure to follow the procedural requisites of Chapter 77, Florida’s Garnishment
Act.
5 This provision reads, in relevant part, as follows:
Within 5 days after service of the garnishee’s answer on the plaintiff .
. . , the plaintiff shall serve, by mail, the following documents: a copy
of the garnishee’s answer, and a notice advising the recipient that he
or she must move to dissolve the writ of garnishment within 20 days
after the date indicated on the certificate of service in the notice if any
allegation in the plaintiff’s motion for writ of garnishment is untrue. . .
.
§ 77.055, Fla. Stat. (2017).
3
provided a copy of Bank’s answer to Villamorey and notified Villamorey that, in
order to dissolve the writ of garnishment directed towards its account at Bank,
Villamorey must file a motion to dissolve the writ within twenty days.
Upon receipt of BDT’s notice, Villamorey filed a motion to dissolve BDT’s
writ pursuant to section 77.07(2) of the Florida Statutes (2017).6 In this motion,
Villamorey claimed, inter alia, that: (i) Villamorey does not owe any debt to BDT;
(ii) the legal presumption is that a bank account is owned by the entity named on
the account (i.e., Villamorey); (iii) BDT failed to overcome this legal presumption
because the audit report upon which BDT relied did not establish any ownership
interest of Lisa in the Villamorey account at Bank; and (iv) BDT’s foreign
judgment against Lisa was a sham because, among other things, BDT and Lisa
were related entities, owned by the same parent company, and represented by the
same counsel.
6 The sections reads, in relevant part, as follows:
The defendant and any other person having an ownership interest in
the property, as disclosed by the garnishee’s answer, shall file and
serve a motion to dissolve the garnishment within 20 days after the
date indicated in the certificate of service on the defendant and such
other person of the plaintiff’s notice required by s. 77.055, stating that
any allegation in plaintiff’s motion for writ is untrue. On such motion
this issue shall be tried, and if the allegation in plaintiff’s motion
which is denied is not proved to be true, the garnishment shall be
dissolved. . . .
§ 77.07(2), Fla. Stat. (2017).
4
BDT propounded discovery on Villamorey with respect to the writ of
garnishment. Specifically, BDT served Villamorey with a request for admissions,
a request for production of documents, and also sought to depose Villamorey’s
corporate representative. Villamorey then filed the instant motion (“Villamorey’s
Motion”) seeking to quash BDT’s discovery or, in the alternative, for a protective
order. Villamorey’s Motion raises several general grounds as to why it is not
subject to discovery, but, of consequence to this opinion, is Villamorey’s argument
that because the trial court lacks personal jurisdiction over it, it is not a party to the
garnishment proceedings and, therefore, it cannot be compelled to respond to
BDT’s discovery.
On August 3, 2017, the trial court held a hearing on Villamorey’s Motion
and, noting that Villamorey intended to participate fully in court-ordered mediation
and at trial, entered a discovery order rejecting Villamorey’s argument that it was
not a party to this action:
During the hearing on Villamorey’s Motion, counsel for
Villamorey took the position that it had the right to and intended to
fully participate at trial. Villamorey’s counsel additionally contended
that Villamorey has an “absolute right” to present a motion for
summary judgment pursuant to Florida Rule of Civil Procedure 1.510,
which provides for the filing of a motion for summary judgment by a
party. I do not disagree with Villamorey that it has the right to fully
participate in this post[-]judgment action through and including trial.
This is based on my finding that it is a party, as discussed below. In
the meantime, Villamorey will be involved in alternative dispute
resolution mechanisms, having agreed to participate in mediation and
having agreed on the selection of a mediator.
5
Villamorey’s argument that it is not a party to this action fails
the “Duck Test.” This well-known abductive reasoning test posits: “If
it looks like a duck, and quacks like a duck, then it is a duck.” Here,
Villamorey looks like a party, has quacked like a party, and is
swimming like a party in the post-judgment litigation pond. To this
Court, therefore, Villamorey is a party to these post-judgment
proceedings.[7]
(Citations omitted). Villamorey timely appealed the trial court’s discovery order,
which we stayed during the pendency of this appeal.
II. ANALYSIS8
Villamorey asserts that, because it has not filed an affidavit attesting to its
ownership of the Villamorey account at Bank pursuant to section 77.16(1) of the
Florida Statutes (2017),9 it is merely in a defensive posture in the garnishment
7 The trial court’s order was without prejudice to Villamorey making specific
objections to any of BDT’s discovery requests. Thereafter, reserving its objection
that it was not subject to the personal jurisdiction of the court, Villamorey
responded to both BDT’s request for admissions and BDT’s request for production
of documents. Villamorey fully responded to BDT’s request for admissions;
therefore, the request for admissions is not the subject of this appeal. As to BDT’s
request for production, Villamorey responded that certain documents were already
in BDT’s possession or did not exist at all. Villamorey objected to the remainder of
the requests on various grounds, including that “to the extent such documents exist
in the possession of Villamorey they are not located in this jurisdiction.”
8 We review, de novo, that portion of the trial court’s discovery order determining
that it had personal jurisdiction over Villamorey. See Am. Exp. Ins. Servs. Europe
Ltd. v. Duvall, 972 So. 2d 1035, 1038 (Fla. 3d DCA 2008) (“The standard of
review is de novo whenever a case, such as this, arises from the trial court’s
decision on a motion to dismiss for lack of personal jurisdiction.”).
9 This statute reads, in relevant part, as follows:
6
action, is not a true party to the garnishment action, and is, therefore, not subject to
BDT’s discovery. We disagree.
Villamorey’s assertion that only persons who have filed an affidavit under
section 77.16(1) are actual parties to a garnishment proceeding misreads the
relevant statutory construct of Chapter 77. Because Villamorey was identified in
Bank’s answer as having an ownership interest in the Villamorey account at Bank,
Villamorey was not required to file an affidavit before exercising its section
77.07(2) right to move to dissolve the writ. See Navon, Kopelman & O’Donnell,
P.A. v. Synnex Informacion Techs. Inc., 720 So. 2d 1167, 1168 (Fla. 4th DCA
1998) (“The statutory right to move to dissolve the writ is granted only to the
defendant and any other person having an ownership interest in the property, as
disclosed by the garnishee’s answer. § 77.07(2). The statutes contemplate that
other persons who claim an ownership interest . . . in property in . . . possession of
the garnishee, may assert such claim by filing an affidavit under the provisions of
section 77.16.”).
If any person other than defendant claims that . . . the property in the .
. . possession of any garnishee is that person’s property and shall
make an affidavit to the effect, the court shall impanel a jury to
determine the right of property between the claimant and plaintiff
unless a jury is waived.
§ 77.16(1), Fla. Stat. (2017).
7
Moreover, irrespective of which statutory procedure is invoked – section
77.07(2) or 77.16(1) – the result is the same: the person, by affirmatively seeking
to dissolve the writ, has assented to the court’s jurisdiction over it and is a party to
the garnishment proceedings. See Babcock v. Whatmore, 707 So. 2d 702, 705
(Fla. 1998) (concluding that a challenge to personal jurisdiction is waived by
seeking affirmative relief); Boeykens v. Slocum, 356 So. 2d 1341, 1342 (Fla. 3d
DCA 1978) (affirming the denial of defendants’ motion contesting the validity of a
writ of garnishment where defendants, based on the alleged lack of personal
jurisdiction over them, made a special appearance in the proceeding to file the
motion; but finding that “[i]f . . . the defendants . . . elect to submit to the
jurisdiction of the court and thereupon challenge the validity of the garnishment
order . . . they should be entitled to do so”).10
III. CONCLUSION
Villamorey is entitled to a trial on the issue of whether the money in the
Villamorey account at Bank is subject to garnishment (i.e., whether the funds
actually belong to Lisa);11 and, Villamorey can propound discovery and be
10 We find it of no matter that Villamorey purported to preserve its jurisdictional
claim in its motion to dissolve the writ of garnishment. Given that Villamorey has
already agreed to participate in mediation and stated its intention to participate at
trial, there can be no question that Villamorey has elected to submit itself to the
jurisdiction of the trial court. Therefore, this matter may proceed further on this
dissolution issue. Boeykens, 356 So. 2d at 1342.
11 We express no opinion on whether the Villamorey account is subject to
8
compelled by the trial court to respond to BDT’s discovery.12 We therefore affirm
the trial court’s discovery order on appeal, and remand for further proceedings.
Affirmed.
garnishment by BDT.
12Such requirement is, of course, subject to any specific discovery objections by
Villamorey.
9