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Aly v. Hanzada For Import & Export Co., Ltd.

United States District Court, W.D. Missouri, St. Joseph Division

January 13, 2017

HASSANIN ALY, Plaintiff/Judgment Creditor,
v.
HANZADA FOR IMPORT & EXPORT COMPANY, LTD., Defendant/Judgment Debtor, NATIONAL BEEF PACKING COMPANY, LLC, Garnishee.

          ORDER DENYING MOTION TO QUASH WRIT OF GANRISHMENT AND PARTIALLY GRANTING MOTION FOR ATTORNEYS' FEES

          GREG KAYS, CHIEF JUDGE UNITED STATES DISTRICT COURT

         A jury found Defendant Hanzada for Import & Export Company, Ltd. (“Hanzada”), liable for breach of contract. Plaintiff Hassanin Aly (“Aly”) seeks to satisfy his judgment against Hanzada through writs of garnishment filed with National Beef Packing Company, LLC (“National Beef”). Prior to filing this motion, Aly served a writ of garnishment (“First Writ”) on National Beef, but failed to recover any assets.

         Now before the Court is National Beef's motion to quash Aly's second writ of garnishment (“Second Writ”) and motion for attorneys' fees and costs for the First Writ, Second Writ, and preparing this motion to quash (Doc. 192). For the following reasons, the motion to quash the Second Writ is DENIED, the motion for attorneys' fees and costs for the First Writ is GRANTED, and the motion for attorneys' fees and costs for the Second Writ and this motion is DENIED.

         Background

         Aly has a $1, 591, 286.60 judgment against Hanzada. Aly sought to satisfy the judgment with two writs of garnishment against a third party, National Beef. On May 10, 2016, Aly filed for a writ of garnishment against National Beef (Doc. 155 & 156). On May 25, 2016, Aly served National Beef the First Writ and accompanying interrogatories requesting National Beef turn over all money and property belonging to Hanzada through the return date of the writ, June 10, 2016 (Doc 181). In its interrogatory answers, National Beef denied possession or control of any money or property belonging to Hanzada (Doc. 192 at 9-13). Aly did not file denials or exceptions to National Beef's answers.

         On July 19, 2016, Aly filed a second request for a garnishment summons and the Court issued the Second Writ with a return date of October 17, 2016 (Doc. 189). National Beef complains Aly is barred from pursuing the Second Writ because Aly's failure to file exceptions or denials to the First Writ caused the Court to lose jurisdiction to enforce the Second Writ. This argument is without merit.

         Standard

         Proceedings in aid of execution of a judgment “must accord with the procedure of the state where the court is located.” Fed.R.Civ.P. 69. The parties do not dispute Missouri law applies in this case. In applying Missouri law, district courts are bound by the decisions of the Supreme Court of Missouri. Lancaster v. Am. & Foreign Ins. Co., 272 F.3d 1059, 1062 (8th Cir. 2001). If the Supreme Court of Missouri has not addressed an issue, the court must determine how the Supreme Court would decide the case. Id. Decisions by intermediate appellate courts provide persuasive authority and they can be followed “when they are the best evidence of state law.” Id.

         Discussion

         National Beef argues this Court is without jurisdiction to enforce the Second Writ. Alternatively, if the Court possesses jurisdiction, the law precludes Aly from submitting a second writ because the First Writ failed to produce any assets. Aly responds he did not abandon his garnishment action against National Beef by not filing exceptions to National Beef's interrogatory answers, and that he is permitted to file subsequent garnishment writs covering different time periods.

         I. This Court did not lose jurisdiction because Aly did not abandon its garnishment proceeding.

         A. Aly did not fail to follow the rules governing garnishment proceedings.

         In a garnishment proceeding, a garnishor's failure to proceed as required by statute and rule constitutes abandonment and the circuit court loses its jurisdiction to proceed. State ex rel. Bagnell Inv. Co. v. Luten, 647 S.W.2d 539, 541 (Mo. 1983). With regard to interrogatories, the garnishor may file denials or exceptions to the garnishee's answers. Mo. Rev. Stat. §§ 525.180 (“[t]he plaintiff may except to the answer of the garnishee for insufficiency. . .”) (emphasis added); 525.190 (“The plaintiff may deny the answer of the garnishee, in whole or in part, without oath.”) (emphasis added); Mo. Sup. Ct. R. 90.07(c) (“The garnishor shall file and serve on the garnishee any exception to the interrogatory answers, asserting any objections to the answers and asserting all grounds upon which recovery is sought against the garnishee.”).

         National Beef reads the requirements of Rule 90.07(c) as stating the garnishor must file exceptions or denials in all circumstances or else the court loses jurisdiction over any future garnishment writ against the garnishee. But the rule states the garnishor must file any exception. If there are no exceptions, none must be filed. Further, the statute states the plaintiff-garnishor may file exceptions or denials. Consequently, Aly was not required to file exceptions or denials to National Beef's interrogatory answers to the First Writ. Therefore, Aly did not fail to follow the ...


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