MONTGOMERY, Ala (Legal Newsline) – Alabama's Court of Civil Appeals has effectively overturned an approximately $10,000 default judgment in a long-standing squabble between two businesses over three knitting machines and a forklift.
In its opinion handed down April 7, the appellate court reversed a circuit court order that denied a defense motion to quash a writ of execution by default, which itself had been entered by the circuit court. The circuit court's decision, several years ago, had allowed Dan Horton, under the business name Heritage Footwear, a judgment by default, court costs and interest against defendants Keith Sharp and Guardian Brokers for a little more than $10,000.
The appeal filed over a circuit court decision to uphold the writ of execution hinged on whether the plaintiff in the case, Horton, had checked a certain box on the writ-of-execution form. Checking the box indicated the property was restored to Horton, despite his own testimony that the property had never previously been in his possession.
"Indeed, the evidence indicates that Horton completely disregarded the applicable statutory requirements for the conduct of the sale," the appellate court ruling said. "For example, Horton did not simply give insufficient notice of the sale; instead, he did not attempt to provide notice of the sale or to conduct a statutorily compliant sale. Moreover, Horton retained property and retained the proceeds from the sale above the amount of the judgment."
The case began Sept. 26, 2012, when Horton filed his case in DeKalb Circuit Court claiming Keith Sharp, under his business Pegasus Partners, didn't pay Heritage Footwear for work Horton's company had done. When Sharp didn't show up for a hearing the following January, the circuit court entered the default judgment in favor of Horton for $9,577.40, in addition to $422.60 in interest and court costs.
On Feb. 21, 2013, Horton obtained a writ of execution regarding property in Pegasus Partner's possession but Sharp, the following June, filed a motion to quash that writ of execution. Sharp claimed the knitting machines and forklift, by then already seized by Horton, was in fact own by Guardian Brokers.
The following November, the circuit court added Guardian Brokers as defendants in the case and denied Sharp's motion, leaving the writ of execution in place and ordering Horton to file a report about the equipment, including all expenses, attorney fees and cost.
Sharp and Guardian Brokers filed their notice of appeal the following December.
A little more than two years later, this past February, the circuit court held a de novo trial over who owned the property seized in 2013. During the trial, Horton testified he checked the box next to "Restore the property to Dan Horton" on the writ-of-execution form. Horton also testified that he had stored the machines and forklift in warehouse about 15 to 20 minutes away from where the property had been seized and subsequently sold the knitting machines to a third party for $16,000.
Horton retained possession of a forklift seized as part of his writ of execution, according to court documents.
In his post trial brief, Sharp argued the execution was irregular and that the writ of execution should be quashed.
On May 12, 2016, the circuit court denied Sharp's petition to quash the writ of execution, which prompted Sharp to file a post-judgment motion June 10, 2016. On Sept. 23, 2016, the same court denied Sharp's post-judgment motion. Sharp and Guardian Brokers appealed the following November and the case was taken up by Alabama's Court of Civil Appeals.