The Elliott Law Group, P.A., and William C. Elliott
Five Star Credit Union
from Montgomery Circuit Court (CV-08-900863)
Star Credit Union ("Five Star") has attempted for
over a decade to collect a debt owed by William C. Elliott.
Five Star obtained a judgment against Elliott in 2011, but he
never paid. In 2017, Five Star sought to garnish
Elliott's wages by filing a process of garnishment in the
Montgomery Circuit Court against Elliott's employer, The
Elliott Law Group, P.A. ("ELG"), a law firm that is
under Elliott's complete control. ELG opposed the process
of garnishment. Following a hearing, the trial court found
that the assertions in ELG's opposition were untrue and
ordered that Elliott's income from ELG be garnished.
Elliott and ELG (hereinafter referred to collectively as
"the appellants") now appeal. Because the
appellants' arguments lack merit, we affirm the judgment
of the trial court.
and Procedural History
case began more than a decade ago. In August 2008, Five Star
sued Elliott alleging breaches of various loan agreements. On
February 22, 2011, the trial court entered a judgment for
Five Star in the amount of $777, 655.98 plus court costs.
September 25, 2017, following other attempts to collect on
the judgment, Five Star filed a process of garnishment
against ELG in the amount of $1, 011, 112.83. On October 28,
2017, ELG filed a garnishment answer in which it stated:
"[Elliott] is employed, but [Elliott] is indebted to
[ELG] in an amount greater than [Elliott's] wages. [ELG]
has right of sett-off [sic] and consensual lien on
wages." On December 27, 2017, 60 days after ELG filed
its garnishment answer, Five Star filed a verified contest of
ELG's answer ("the contest"), in which counsel
for Five Star stated (1) that he believed ELG's answer to
be untrue and (2) that the parties had agreed to waive the
requirement in § 6-6-458, Ala. Code 1975, that contests
to a garnishee's answer be filed within 30 days after
notice of the filing of the answer.
a hearing on the contest, the trial court concluded that
ELG's garnishment answer was untrue. The trial
court's conclusion was based primarily on the following
findings of fact:
• ELG is under Elliott's complete control. Elliott
is the president and sole shareholder of ELG.
• Although ELG based its garnishment answer on an
employment agreement ("the employment agreement")
purportedly dated January 1, 2017, the employment agreement
was not executed until September 2017, after a postjudgment
evidentiary hearing and examination of Elliott by Five Star.
• The employment agreement stated that ELG would pay
Elliott an annual salary of $48, 000 and provide Elliott with
a $260, 000 line of credit to be repaid annually at 1% of the
principal balance and at ELG's discretion. Any failure by
Elliott to make a payment to ELG was not a default under the
• The employment agreement purported to give ELG a
consensual lien on all of Elliott's income as security
for any debt that Elliott owed ELG.
• Elliott does not maintain an individual bank account,
and all of his personal and business expenses are paid from
an account in ELG's name. The loan agreement between
Elliott and ELG was "simply a means of receiving
compensation from [ELG] without acknowledging the
compensation as salary or wages." No legitimate business
purpose existed for the line-of-credit compensation
"other than the avoidance of payment of creditors."
The employment agreement was "simply a means to remove
funds from [ELG] and pay the same to [Elliott] without any
obligation of repayment except at the sole discretion
on these and other findings of fact, the trial court
concluded that ELG's purported consensual lien and setoff
rights were unenforceable against Five Star. It ordered
Elliott to withhold a portion of his income from ELG and
submit the garnished amounts to the clerk of the trial court
each month, along with calculations of business and personal
expenses as well as bank statements reflecting transactions
from ELG's bank accounts. Following the trial court's
denial of their postjudgment motions filed under Rule 59(a)
and Rule 59(e), Ala. R. Civ. P., the appellants appealed
under § 6-6-464, Ala. Code 1975.