Zeb Barbee v. Res-Ga Scl, LLC
Zeb Barbee v. Res-Ga Scl, LLC
Opinion
*194 The dispositive issue in these related appeals is whether the trial court exceeded its authority by setting aside and re-entering orders dismissing plaintiff RES-GA SCL, LLC's ("RES-GA") fraudulent transfer claims against defendants Shelley A. Brock ("S. Brock"), The 2007 Brock Family Trust, AOBAtlanta, LLC, and Zeb Barbee (hereinafter collectively "defendants"), 1 which started *916 the clock running anew and provided RES-GA with another opportunity to timely appeal the dismissal orders. As more fully set forth below, we now reverse in Case Nos. A16A1595 and A16A1596 and dismiss in Case No. A17A0168.
The following facts are pertinent to our analysis. In July 2014, RES-GA obtained a judgment in excess of $18,000,000 against, inter alios, Thomas Brock ("T. Brock") under the terms of a personal guaranty of a commercial loan that had been assigned to RES-GA. 2 In February 2015, RES-GA filed a complaint against T. Brock and others, including the defendants named herein, 3 seeking to set aside *195 certain transactions as fraudulent transfers under the Georgia Uniform Fraudulent Transfers Act ("UFTA"), OCGA § 18-2-70. 4 The fraudulent transfer defendants filed motions to dismiss, asserting among other things that RES-GA lacked standing to challenge those allegedly fraudulent transfers that were made before it was assigned an interest in the loan or debt, 5 and on the basis that RES-GA had failed to obtain the necessary certificate of authority to transact business in Georgia. See OCGA §§ 14-11-702 and 14-11-711.
On July 16, 2015, the trial court entered an order dismissing the fraudulent claims for transfers that occurred before RES-GA was assigned an interest in the debt on October 18, 2010. The trial court also found that RES-GA was barred from seeking to set aside a post-assignment transfer that occurred on April 6, 2011, because it had not yet obtained a certificate of authority to transact business in Georgia, but deferred dismissing any such claim for 30 days to give RES-GA an opportunity to provide the court with documentation that it was certified to transact business in Georgia. RES-GA sought a certificate of immediate review from the July 16 order, but the trial court denied RES-GA's request on July 27, 2015. However, RES-GA also filed a notice of direct appeal from the trial court's July 16 order on July 24, 2015.
RES-GA did not provide the necessary proof of its authority to transact business in Georgia, and on August 31, 2015 and September 1, 2015, the trial court entered a series of orders dismissing with prejudice the remaining fraudulent transfer claims, which constituted a final disposition in the case. 6 Significantly, RES-GA did not file a notice of appeal from any of the final dismissal orders, and on October 5, 2015, defendants, inter alios, filed a motion to dismiss the July 24 notice of appeal on the basis that the order being appealed was not final and the trial court had denied RES-GA's request for a certificate of immediate review. On December 23, 2015, the trial court dismissed the July 24, 2015 notice of appeal as premature. However, at the same time, the trial court also sua sponte entered a separate *196 order setting aside the final dismissal orders and reentering those orders as of that date.
On January 20, 2016, defendants S. Brock, The 2007 Brock Family Trust, and AOBAtlanta, LLC filed a notice and corrected notice of appeal from the portion of the December *917 23, 2015 order setting aside and reentering the final dismissal orders, and that appeal was docketed in this Court as Case No. A16A1595; appellee Zeb Barbee filed a separate notice of appeal from the December 23, 2015 order, and that appeal has been docketed in this Court as Case No. A16A1596. On December 28, 2015, RES-GA filed a notice of appeal challenging the substantive rulings of the trial court on the issues of the assignability of the fraudulent transfer claims and the need for a certificate of authority as a prerequisite to pursuing its fraudulent transfer claim, and that appeal has been docketed in this Court as Case No. A17A0168. 7
Case Nos. A16A1595 and A16A1596
1. Defendants 8 argue that the trial court lacked the authority sua sponte to set aside and reenter the final dismissal orders after the expiration of the term of court in which they were entered. On the other hand, RES-GA asserts that the filing of the July 24, 2015 notice of appeal acted as a supersedeas, and the dismissal orders entered while that notice was pending were without legal effect, a nullity and void, and thus could be set aside by the trial court at any time.
Generally speaking, in civil actions a trial court, upon the filing of a notice of appeal, loses jurisdiction to modify or enforce a judgment which is the subject of the appeal during the period of supersedeas, and only those matters which are independent of and distinct from the judgment on appeal remain within the jurisdiction of the trial court. OCGA § 5-6-46 ;
Davis v. Harpagon Co.
,
However, as defendants contend, the final dismissal orders in this case are not void. As our Supreme Court recently explained, a notice of appeal does not act as a supersedeas when a party attempts to appeal an interlocutory order but fails to follow the requirements for obtaining interlocutory review set out in OCGA § 5-6-34 (b), which includes obtaining a certificate of immediate review from the trial court and an order from the appellate court granting the appeal.
Islamkhan v. Khan
,
The question then is whether the trial court had the authority to set aside and reissue these valid orders more than two terms after they were entered. "[T]he general
*918
rule [is] that a 'court cannot set aside or alter its final judgment after the expiration of the term at which it was entered, unless [a] proceeding for that purpose was begun during the term.'
Young Constr. v. Old Hickory House #3
,
Because the trial court had no authority to set aside and reenter the August 31, 2015 and September 1, 2015 dismissal orders outside the term in which they were entered, the subsequent December 23, 2015 reentered orders are null and void, and the August 31, 2015 and September 1, 2015 final dismissal orders must be reinstated.
Tanaka v. Pecqueur
,
Case No. A17A0168
2. RES-GA did not attempt to appeal the August 31, 2015 and September 1, 2015 final dismissal orders, and any appeal from those orders is now time barred. See OCGA § 5-6-38 (a) ("A notice of appeal shall be filed within 30 days after entry of the appealable decision or judgment complained of ..."). And although RES-GA did file a notice of appeal from the December 23, 2015 reentered dismissal orders, those orders were void, and any appeal from that order was ineffective. See
Bryan v. Brown Childs Realty Company, Inc.
,
Judgments reversed in Case Nos. A16A1595 and A16A1596. Appeal dismissed in Case No. A17A0168.
Miller, P.J., and McFadden, P.J., concur.
Other defendants were also named in the original fraudulent transfer complaint, but the parties listed above are those named in the notices of appeal filed in Case Nos. A16A1595 and A16A1596.
A more complete version of the circumstances surrounding the loan is set out in
RES-GA SCL, LLC v. Stonecrest Land, LLC
,
The defendants in the fraudulent transfer case, including those not parties on appeal, will be collectively referred to as "fraudulent transfer defendants."
We will refer to the operative provisions of the UFTA as they existed at the time the complaint was filed, while noting that the UFTA was amended effective July 1, 2015 and is now called the Uniform Voidable Transactions Act ("UVTA"). See Ga. L. 2015, p. 996, § 4A-1.
In Georgia, fraud claims generally are not assignable, and this Court has held that an assignee of a debt is precluded from pursuing a fraudulent transfer claim under the pre-2015 version of the UFTA. See
RES-GA Hightower, LLC v. Golshani
,
These orders will be collectively referred to as the "final dismissal orders."
RES-GA filed its notice of appeal to the Supreme Court of Georgia, but that Court transferred the appeal to us; that appeal has been docketed to the December 2017 term of court.
"Defendants" as used here refers only to those fraudulent transfer defendants who have filed notices of appeal from the trial court's order.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.