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McComas v. Meadows

Supreme Court of Appeals of West Virginia

November 4, 2019

Robert McComas, Plaintiff Below, Petitioner
v.
Freddie Elaine Meadows, Defendant Below, Respondent

          (Raleigh County 10-C-271-H)

          MEMORANDUM DECISION

         Petitioner Robert McComas, by counsel Amber Hinkle, appeals the May 7, 2018, order of the Circuit Court of Raleigh County granting respondent's motion for summary judgment. Respondent Freddie Elaine Meadows, by counsel Thomas K. Patterson, filed a response in support of the circuit court's order.

         The Court has considered the parties' briefs and the record on appeal. The facts and legal arguments are adequately presented, and the decisional process would not be significantly aided by oral argument. Upon consideration of the standard of review, the briefs, and the record presented, the Court finds no substantial question of law and no prejudicial error. For these reasons, a memorandum decision affirming the circuit court's order is appropriate under Rule 21 of the Rules of Appellate Procedure.

         Mr. Lonnie Meadows[1] operated a car lot, 4-M Motor Sales, Inc. ("4-M").[2] On July 27, 2009, Ms. Janet McComas issued a $30, 000 check made payable to 4-M Motors with the intention of that money serving as a loan. This loan was memorialized in an August 24, 2009, promissory note between Ms. McComas and Mr. Meadows on behalf of 4-M, the purpose of which was to allow Mr. Meadows to acquire inventory for 4-M. At the time of the loan and promissory note, Respondent Ms. Meadows was married to but estranged from Mr. Meadows. Ms. Meadows had nothing to do with the loan or the promissory note, but she had previously been listed as an officer of 4-M.

         Mr. and Ms. Meadows were divorced in 2010. On June 28, 2010, Mr. Meadows transferred his interest in three parcels of real estate to Ms. Meadows, attendant to their divorce proceedings. Ms. Meadows received the property subject to a mortgage.

         Ms. McComas[3] initially filed Civil Action Number 10-C-271 in the Circuit Court of Raleigh County to enforce the $30, 000 promissory note against Mr. Lonnie Meadows. Ms. McComas subsequently amended her complaint to include Freddie Elaine Meadows, Mr. Meadows's soon-to-be ex-wife, as a defendant.

         On August 27, 2010, Petitioner McComas filed a second civil action, Civil Action Number 10-C-985, in the Circuit Court of Raleigh County, against Mr. Lonnie Meadows and Ms. Freddie Elaine Meadows, in which she sought to set aside the property transfers from Mr. Meadows to Ms. Meadows. Ms. McComas alleged that these transfers were fraudulent and made to avoid payment of the promissory note to her. Petitioner's second civil action was stayed pending a determination in the original civil action as to the promissory note.[4]

         Respondent Ms. Meadows filed a motion for summary judgment in Civil Action Number 10-C-271, concerning petitioner's claims against Ms. Meadows on the promissory note. Petitioner McComas submitted a response in opposition to Ms. Meadows's motion for summary judgment, but the circuit court found that Petitioner McComas failed to allege sufficient facts to show that there was a genuine issue for trial. Accordingly, the circuit court granted Ms. Meadows's motion for summary judgment in a March 17, 2016, order finding that Ms. Meadows was not personally liable for the debt. In so holding, the court noted that there were two possible ways for liability to attach to Ms. Meadows, either through her prior officer status with 4-M or through her marriage to the debtor. Considering both, the circuit court found that liability could not attach to Ms. Meadows through either of those theories, and it granted summary judgment in Ms. Meadows's favor, and thus, dismissed Ms. Meadows as a defendant in Civil Action Number 10-C-271.[5] Petitioner's case proceeded to a bench trial against Mr. Meadows. Following the March 30, 2016, bench trial, the circuit court entered a May 5, 2016, judgment order, awarding Ms. McComas $30, 000, plus interest, from Mr. Meadows's estate.[6]

         On March 30, 2018, Ms. Meadows filed a motion for summary judgment as to petitioner's fraudulent conveyance claim against her. Petitioner filed a memorandum in opposition to the motion for summary judgment. The circuit court granted the motion, ruling that the case could be decided based upon two issues: First, the court had previously found that Ms. Meadows was not personally liable on the promissory note signed by Ms. McComas and Mr. Meadows. The court found that it would be unfair and unjust to take private property belonging to Ms. Meadows to satisfy a judgment where there had already been a finding that she was not personally liable for the debt. Second, the circuit court found that there was no evidence to indicate that Mr. or Ms. Meadows had any intent to "hinder, obstruct or defraud" anyone when the marital property was transferred, but instead had entered into a division of property, subject to judicial approval by the Family Court of Raleigh County during their divorce proceeding. The circuit court noted that the family court deemed the division of property to be fair and equitable. Thus, the court granted Ms. Meadows's motion for summary judgment. Petitioner appeals from this order.

         As we have oft said, "[a] circuit court's entry of summary judgment is reviewed de novo." Syl. Pt. 1, Painter v. Peavy, 192 W.Va. 189, 451 S.E.2d 755 (1994).

         Petitioner raises two assignments of error on appeal. Initially, petitioner argues that genuine issues of material fact exist regarding whether Mr. Meadows fraudulently transferred the marital assets to Ms. Meadows. Petitioner claims that the circuit court's ruling amounts to a finding that petitioner's claims were barred by the doctrine of res judicata, as the court previously found that Ms. Meadows was not personally liable because she had no knowledge of the loan; no knowledge that she had been designated as a corporate officer in 4-M; and, further, that 4-M no longer existed.

         Although notably absent in either party's briefing, petitioner's claim against respondent is predicated upon West Virginia Code § 40-1A-4, West Virginia's fraudulent conveyance statute.[7] Petitioner does, however, allude to the language of the statute when he alleges that the disparity in the property division between Mr. and Ms. Meadows is, by itself, sufficient to support a finding that respondent received the property with the intent to hinder, obstruct, and defraud creditors such as the petitioner. We disagree.

         At the outset, we concur with the circuit court's finding that the transfer of real property in this case was presented to, and approved by, the family court, which is a court of competent jurisdiction. Despite petitioner's overtures to the contrary, petitioner has not referenced any evidence, and there is no evidence in the record, to suggest that the transfer of real property from Mr. Meadows to Ms. Meadows was done so as to hinder, delay, or defraud a creditor such as petitioner, an essential element of petitioner's claim.[8] We have long held that:

"[s]ummary judgment is appropriate where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, such as where the nonmoving party has failed to make a sufficient showing on an essential element of the case that it has the burden to prove." Syllabus ...

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