BRIEF OF THE APPELLEE

Transcription

1 E-Filed Document Dec :32: CA Pages: 15 SUPREME COURT OF MISSISSIPPI MARLIN BUSINESS BANK vs. STEVENS AUCTION COMPANY AND JOHN D. STEVENS APPELLANT CAUSE NO. 20I6-CA-OI 2016-CA APPELLEES APPEAL FROM THE CIRCUIT COURT OF MONROE COUNTY, MISSISSIPPI BRIEF OF THE APPELLEE ORAL ARGUMENT NOT REQUESTED P. Nelson Smith, Jr. Mississippi State Bar No OfCounse! Counsel HICKS & SMITH, PLLC 710 Main Street, 2 d 2 nd Floor P. 0. O. Box 1111 IIII Columbus, MS (662) nsmith@ghs-law.com nsmith@ghs-iaw.com Attorney for Plaintiff - Appellee Dwight Stevens 1

2 SUPREME COURT OF MISSISSIPPI MARLIN BUSINESS BANK vs. STEVENS AUCTION COMPANY AND JOHN D. STEVENS APPELLANT CAUSE NO CA APPELLEES CERTIFICATE OF INTERESTED PERSONS The undersigned counsel of record certifies that the following listed persons have an interest in the outcome of this case. These representations are made in order that the justices of the Supreme Court and judges of the Court of Appeals may evaluate possible disqualification or recusal. Marlin Business Bank, Appellant; M. Reed Martz, Counsel for Appellant; Stevens Auction Company, Appellee; John D. Stevens, Appellee; and P. Nelson Smith, Jr., Counsel for Appellees. Attorney of Record for Appellee Isl P. Nelson Smith, Jr. P. NELSON SMITH, JR., MSB No

3 TABLE OF CONTENTS PAGE CERTIFICATE OF INTERESTED PERSONS STATEMENT OF ORAL ARGUMENT STATEMENT OF ISSUES STATEMENT OF THE CASE SUMMARY OF THE ARGUMENT ARGUMENT CONCLUSION CERTIFICATE OF SERVICE

4 TABLE OF CASES AND OTHER AUTHORITIES CASES: PAGE Long Beach Auto Auction, Inc. v. United Security Alliance, Inc., 936 So2d 351 (Miss. 2006)... 8, 11, 12 Titan Indemnity Company v Hood, 895 So2d 138 (Miss. 2004) Shelton v. Kindred, 279 So2d 642 (Miss. 1973)

5 Appellee does not request oral argument. STATEMENT OF ORAL ARGUMENT 5

6 STATEMENT OF ISSUES I. Whether the trial court erred in not enrolling the foreign judgment of the Plaintiff upon the judgment rolls of Monroe County, Mississippi. 6

7 STATEMENT OF THE CASE On or about January 12, 2015, Plaintiff, Marlin Business Bank filed a "Notice of Enrolling of Foreign Judgment." RE 7-8. Mr. Stevens, d/b/a Stevens Auction Company, filed his objection on February 2, Mr. Stevens had executed a contract, entitled "Work Order," with Security Depot, for the lease and installation of a security system on his auction premises. RE 24; Exhibit page 3. The "work order" contract is only between Mr. Stevens and Security Depot. RE 24; Exhibit page 3. He made at least two payments to Security Depot. The work order contract and checks are part of the court file and record on appeal. RE 24; Exhibit pages 1-6. The trial Court marked all exhibits for identification, and placed them in the Court file, so as to be part of the record. T.T. 10, II, 23 ; Exhibit pages 1-6. After installation, Stevens was presented with a lease for Marlin Business Bank, by Security Depot. Marlin Business Bank had not been part of the contract with Security Depot. However, the security system had been installed, two payments made to Security Depot, and then Mr. Stevens was faced with a "take-itor-leave-it" situation with Marlin Business Bank. He had to execute the lease with Marlin as he had no other viable option or even an opportunity to negotiate terms with Marlin. The equipment failed and Mr. Stevens ceased payments to Marlin. Marlin took a default judgment in Pennsylvania. RE 10. Marlin then sought to enroll the foreign judgment, taken in city court in Philadelphia, Pennsylvania. Stevens objected and a hearing was held on May 12, Thereafter, the Circuit Court issued its ruling and opinion on June 28, 2016, denying the enrollment. RE Subsequently, Marlin filed its notice of appeal on or about July 22, R Marlin designated, as the record on appeal, all clerk' s papers, trial transcripts and exhibits filed, taken or ordered in this case. RE 51. 7

8 SUMMARY OF THE ARGUMENT The Plaintiff wholly ignores that the Court found, in essence, that Marlin's forum selection clause was the result of overweening bargaining power of Marlin. The Court properly found that the Defendant, Stevens was a victim of a "bait and switch" by Security Depot and Marlin. R The initial agreement and payments were made with Security Depot and not Marlin. R 43; Exhibit pages 5-6. Thereafter, Stevens was faced with a "sign with Marlin or we take your equipment" from Security Depot and Marlin. RE 43. Mr. Stevens had no recourse available and this "take it or leave it" document with Marlin is thus a contract of adhesion. The forum selection clause therein cannot be enforced. The trial court correctly found the default could not be enrolled in Monroe County, Mississippi. RE 43. Though the court found the Long Beach Auto Auction, Inc. v. United Security Alliance, Inc., 936 So. 2d 351 (Miss. 2006) case instructive, the Circuit Court did not rely solely on that case for its ruling and opinion. RE The Court, as the trier of fact in this hearing, also based his decision on the record presented, the motions and briefs filed herein, and arguments of counsel. This Court reviews the ruling of the trial court under the standard review of "de novo." Titan Indemnity Company v Hood, 895 S02d. 138 (Miss. 2004). ARGUMENT AND AUTHORITIES Plaintiff asserts throughout its brief that "nothing" in the record supports the ruling of Circuit Judge Jim Pounds. However, Plaintiff itself designated the record to be included on appeal. RE 51. It designated "all clerk's papers, trial transcripts, and exhibits filed, taken or ordered in this case." RE 51. (emphasis added). The exhibits taken or used at the hearing of this matter are therefore within the court record. RE 39; RE 62; Exhibit pages 1-6. The Court accepted those exhibits, albeit marked for identification only, and all counsel referenced them in their argument to the Court. The trial court asked Plaintiffs counsel ifhe wanted more time "to 8

9 look into this," meaning the documents presented by the Defendant at the hearing of this matter. T.T. 19. Plaintiff's counsel chose not to opt for additional time to look into the documents offered by Defendant. Further, the actual Plaintiff Marlin Business Bank, chose not to attend the hearing, sending only its counsel. The Defendant, Mr. Stevens, was in attendance and offered to testify and verify these documents. The trial court stated Mr. Stevens' testimony was not necessary to verify these documents. T.T. 13. Plaintiff offered no one in opposition and voiced no objection to the Court' s statement. Plaintiff asserts in its brief, for the first time, that it (Marlin) was a financing company. Brief of Appellant, Page 5-6. Marlin says in its Brief of Appellant that after the security system was installed by Security Depot, "Marlin would finance the system." Appellant' s Brief page 5. Again, Marlin states, "Once installed, Marlin began financing security system." Appellant's Brief page 6. However, at the Circuit Court hearing, Marlin asserted otherwise. Counsel for Plaintiff stated: "The first check was made to Security Depot prior to delivery, and that the second would be necessary at delivery. This was to Security Depot for the equipment. Marlin came in and -- they're not a fmancing company..." (emphasis added.) T.T.20 In the very same paragraph, Marlin asserts that it: "... (Marlin) basically purchased their equipment and turned around and leased it back to the Defendant." T.T. 20 Then Marlin asserts: "All we're doing is leasing this equipment to you that you've purchase from someone else." T.T.20 9

10 Marlin doesn't know ifit is a financing company or not. It asserts at trial it is not. It asserts on appeal it is. It asserts at the hearing of this matter that i! (Marlin) purchased the equipment, then asserts Defendant purchased it. T.T. 20. It asserts on page 5 of Appellant's brief that Defendant purchased the equipment from Security Depot. Perhaps most telling is Marlin's own statement in its brief: "Based on the respective agreements with Security Depot and Marlin, Security Depot, the seller ofthe security system, would... " Appellant's Brief page 5. Note who is missing from the agreements between Security Depot and Marlin - Mr. Stevens. This is exactly what was asserted at the hearing of this matter, that is, Mr. Stevens, had never heard of, contracted with, or negotiated with Marlin prior to the contract of adhesion forced upon him. What was forced upon Mr. Stevens is an oppressive, one-sided, "take it or leave it contract." R Within this contract of adhesion, a forum selection clause asserting jurisdiction in Pennsylvania was included. Stevens had no choice but to execute this "lease," as the equipment was already installed and he had made two payments to Security Depot, under his contract with Security Depot. RE 24. Marlin Business Bank is then sprung upon him, and he had no choice - lose the security system or sign the contract with Marlin. To make matters worse, the equipment soon failed! Security Depot had required Mr. Stevens to execute a sixty (60) month lease, but with Security Depot. RE 24. Marlin is never mentioned. RE 24. The contract with Security Depot says litigation is to occur in Georgia, not Pennsylvania. RE 24. Also, Marlin Business Bank is headquartered in Utah, not Pennsylvania. Pennsylvania is only its "processing center." Exhibit page 4. That location, the processing center, is not the lessor. Exhibit page 4. Those are facts unopposed by Marlin at the hearing of this matter. 10

11 Marlin arbitrarily designated Pennsylvania as the nexus of litigation. There is no connection with the Marlin Business Bank, the Lessor, and Defendant Stevens, with the processing center, other than that is just where Marlin wants to litigate. Marlin, at the hearing, did not dispute or offer any evidence in opposition that it did not offer Stevens any opportunity to negotiate. It was a "take-it-or-leave-it" scenario. Marlin pushed for this hearing. To now cry foul when i! offered no evidence or testimony at the hearing is untenable. Long Beach, while the trial Court said it was instructive and not decisive on the issue, ~ particularly instructive to the case here. Long Beach, 936 So.2d 351 (Miss. 2006). In that case, the Mississippi Supreme Court struck down a forum selection clause it determined to be overweemng. The Court squarel y asked counsel for Marlin in the present case: "What would have happened had they (Stevens) not signed it?" T.T. 21. The Court was referring to the document between Marlin Business Bank and Stevens. What was Marlin' s response? Marlin responded with: "I can't answer that question. I don't know." T.T. 21. That follows Marlin's assertion that if Stevens had not liked the forum selection clause, he shouldn't have signed the document with Marlin! T.T. 21. Marlin further asserts: "Marlin wouldn't have taken it (meaning the failed security equipment) because if they (Stevens) hadn't signed the lease with Marlin, there wouldn't be any equipment for Marlin to purchase on their behalf. T.T. 21. (explanation added) That's exactly the point. Marlin said sign this, or your equipment is gone! If you don't sign it, you get no equipment. That was Marlin's position. T.T. 21. II

12 Here, as in Long Beach, the security equipment was installed. Id. Then after installation, this "agreement" with Marlin is sprung upon Stevens, even after he's made two payments to Security Depot pursuant to his agreement with Security Depot. RE 42. Stevens had no choice but to sign Marlin's document or lose the already installed security equipment. Marlin did not dispute, at the hearing, that it is a $790 million asset business. It did not dispute it is a leasing giant. It did not dispute that Mr. Stevens is a small business owner from Aberdeen, Mississippi, not exactly a corporate giant as compared with Marlin. It was undisputed that Pennsylvania is merely Marlin's "processing center." The Circuit Court properly found that Marlin's more than superior bargaining position, and the bait and switch it pulled with Security Depot on Mr. Stevens, renders Marlin's forum selection clause void. RE Thus the judgment taken in Pennsylvania cannot be enrolled on the judgment rolls of Monroe County, Mississippi. Marlin asserts "nothing could have prevented Stevens from their (sic) day in Court (in Pennsylvania)." Appellant Brief, page 12. Eleven hundred miles prevented Stevens from appearing in Pennsylvania. T.T. 16. A contract of adhesion prohibited Stevens from appearing in Pennsylvania. Stevens' small business versus a $790 million giant prevented Stevens from fending off the attack of Marlin. The "take-it-or-leave-it" position of Marlin effectively prevented Stevens from defending himself. The trial court properly ruled that the Pennsylvania judgment should not be enrolled in Mississippi. RE The trial court was well within its authority to examine how the judgment was obtained, and to determine whether it was the result of an improper forum selection clause thrust upon Mr. Stevens due to Marlin's overweening position of authority. Stevens has never denied he executed the document with Marlin. He does assert and has asserted from the day of signing the document forward, that he had no choice but to sign this 12

13 document with Marlin. As appellant's counsel said in its brief, the ruling of the Circuit Court must be presumptively correct, and such presumptions will prevail, unless the actual record supports a contrary view, citing Shelton v Kindred, 279 S02d. 642 (Miss. 1973). Brief of Appellant, Page 10. There is nothing in the record contrary to the ruling of the Circuit Court. This appellant court has the complete record before it and within it contains the documents at issue. This court has all motions, briefs and objections filed in this matter. The trial court gave Plaintiffs counsel the opportunity to continue the hearing in order to conduct further inquiry into the documents presented at the hearing. Plaintiffs counsel chose not to do that. Plaintiff, Marlin then continued at its own peril. It cannot now say that it is aggrieved or prejudiced by these documents when it was given ample opportunity to continue the hearing and make inquiry into these documents. Interestingly, Plaintiffs counsel asserts several times in its Brief of Appellant, that Stevens cites no Pennsylvania law to support his position. However, Plaintiff Marlin also asserts no Pennsylvania law in its Appellant Brief to support his position as well. Brief of Appellant, "Table of Cases and Authorities," Page 3. Appellant incorrectly asserts that Stevens argued that "the forum selection clause should not be enforceable as a matter of inconvenience." What Stevens presented and argued to the Circuit Court was that the agreement between Stevens and Marlin was a result of the overweening bargaining power and position of authority of Marlin Business Bank. CONCLUSION Plaintiff, Marlin Business Bank, filed the notice of enrollment of foreign judgment. A timely and proper objection was filed by Defendant, Stevens. The hearing was properly noticed in counsel for both parties appeared. Mr. Stevens was present at the hearing as well and offered to provide testimony to verify documents presented to the court. The circuit court did not deem 13

14 it necessary for Mr. Stevens to testify as to the documents executed between the parties and executed between Mr. Stevens and Security Depot. Ample opportunity was given to Plaintiff's counsel to continue the hearing and make inquiry into these documents. Plaintiff's counsel refused and the hearing was conducted. Marlin cannot now cry foul when it chose to participate in the hearing. Stevens contracted with Security Depot for the installation of a security system. That agreement with Security Depot provided that a lease would exist between Security Depot and Stevens. Stevens even made two payments to Security Depot, both prior to the appearance of Marlin Business Bank on the scene. Mr. Stevens was then forced to execute the agreement with Marlin Business Bank, as his security equipment had already been installed, and he had no choice under this "take-it-or-leave-it" scenario. The forum section clause within that contract of adhesion therefore cannot be enforced. Therefore the Pennsylvania courts had no jurisdiction to take a default judgment, and/or certainly that judgment cannot be enrolled upon the judgment rolls of Monroe County, Mississippi. Respectfully submitted, Isl P. Nelson Smith, Jr. P.NELSON SMITH, JR. MSB#8771 P. Nelson Smith, Jr. Mississippi State Bar No Of Counsel HICKS & SMITH, PLLC 710 Main Street, 2nd Floor P. 0. Box 1111 Columbus, MS (662) nsmith@ghs-law.com 14 Attorney for Plaintiff - Appellee Dwight Stevens

15 CERTIFICATE OF SERVICE I hereby certify that on the 22nd day of December 2016, I electronically filed the foregoing with the Clerk of the Court using the MEC system which sent notification of such filing to the following: M. Reed Martz FREELAND MARTZ, PLLC 302 Enterprise Drive, Suite A Oxford, Mississippi fax reed@freelandmartz.com By United State Mail, postage prepaid, a copy of the forgoing was sent to: Honorable Jim S. Pounds Monroe County Circuit Court P.O.Box316 Boonville, MS This the 22nd day of December Isl P. Nelson Smith, Jr. P.NELSON SMITH, JR. MSB#