Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Magic City Capital, LLC v. Twickenham Place Partners, LLC

Supreme Court of Alabama

October 25, 2019

Magic City Capital, LLC
v.
Twickenham Place Partners, LLC

          Appeal from Madison Circuit Court (CV-17-900921)

          STEWART, Justice.

         Magic City Capital, LLC ("Magic City"), appeals from a summary judgment entered by the Madison Circuit Court ("the trial court") in favor of Twickenham Place Partners, LLC ("Twickenham"). Because events that occurred during the trial- court proceedings rendered the action moot and the trial court, therefore, was divested of subject-matter jurisdiction, we dismiss the appeal.

         Facts and Procedural History

         The following facts are undisputed. On August 15, 2014, Twickenham executed a lease agreement with Huntsville Asian Rim, LLC ("HAR"), in which HAR agreed to lease certain property from Twickenham for the purpose of opening a restaurant in Huntsville. Section 5.4 of the lease provided, among other things:

"OWNERSHIP OF IMPROVEMENTS. All trade fixtures, equipment and other property placed on the Premises by and any alterations or replacements thereof, including, but not limited to, all bars, booths, decorative light fixtures, stoves, ovens and other restaurant equipment, shall remain the property of, and may be removed by, [HAR]. Upon the expiration or earlier termination of this Lease, any such property belonging to [HAR] which [HAR] has failed to remove from the Premises within thirty (30) days of said expiration or termination shall become the property of [Twickenham]. [Twickenham] may thereafter elect to remove and dispose of such property at [HAR'S] reasonable cost and expense. Should [HAR] remove any such fixture, or any alteration or replacement thereof, affixed to the Premises that was placed on the Premises by [HAR], [HAR], at its sole cost and expense shall repair any damage to the Premises caused by such removal."
The lease also provided in § 14.3:
"[Twickenham] hereby expressly subordinates any and all claim, right, lien (including, without limitation, any common law or statutory landlord's lien), title and security interest in and to all furniture, goods, equipment and personal property of the security interest of [HAR'S] lender, if any, either existing as of the execution date of this Lease or hereafter."

         On November 17, 2014, HAR executed a security agreement in favor of Magic City in exchange for a $250, 000 loan. Pursuant to the security agreement, Magic City was granted a security interest in HAR's personal property used in operating the restaurant. In September 2015, HAR defaulted on its lease obligations to Twickenham, and, thereafter, HAR removed some of, but not all of, its personal property from the restaurant. On October 5, 2015, Twickenham notified Magic City by letter that HAR had defaulted on its lease obligations. In that letter, Twickenham recognized Magic City's priority lien on HAR's furniture and equipment and indicated that it was potentially interested in acquiring that property from Magic City. Twickenham asked that Magic City contact Twickenham if it was interested in selling the personal property. On October 15, 2015, Twickenham served HAR with a notice of the termination of the lease.

         At some point thereafter, HAR defaulted on its loan obligations to Magic City. According to Magic City's complaint, Magic City declared HAR in default of the loan obligations and demanded possession of the personal property from HAR and from Twickenham. Twickenham denied that Magic City demanded possession of the personal property from it.

         In February 2016, HAR filed a petition for protection pursuant to Chapter 7 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Alabama. The bankruptcy proceedings were terminated on May 17, 2017. According to Twickenham, Magic City did not assert its purported superior interest in the personal property at any time during the pendency of the bankruptcy proceedings. On May 30, 2017, Magic City sued Twickenham and Prime, Inc., the new tenant for the property, seeking a judgment declaring its security interest superior to Twickenham's and the recovery of, or the reasonable value of, the personal property.

         On June 30, 2017, Twickenham and Prime filed a motion to dismiss in which they asserted, among other things, that Prime did not have possession or control of the personal property sought by Magic City. On September 12, 2017, the trial court granted the motion to dismiss in part and dismissed Prime as a defendant. Thereafter, Twickenham filed an answer and asserted various affirmative defenses, including the doctrines of laches and equitable estoppel.

         On June 8, 2018, Magic City filed a motion for a summary judgment in which it argued that Twickenham's interest in the personal property was subordinate to Magic City's interest and that Twickenham had wrongfully converted the personal property. In support of its motion, Magic City submitted a copy of the lease agreement, a copy of the security agreement, copies of correspondence between Twickenham and HAR and Magic City, an affidavit of Brian Bateh, a manager of Magic City, and an affidavit of Roy Hockman, the former managing member of HAR. Hockman testified in his affidavit that HAR had defaulted on its lease and loan obligations and that Magic City had demanded possession of the personal-property collateral from both HAR and Twickenham. Hockman did not specify the dates on which the alleged demands for possession of the personal property occurred. Bateh provided affidavit testimony similar to Hockman's.

         On September 13, 2018, Twickenham filed another motion to dismiss in which it asserted that HAR's debt allegedly secured by the personal property to which Magic City claimed a superior interest had been paid in full by Hockman and, therefore, that Magic City's claims were moot and there was no longer a justiciable controversy before the trial court. Magic City filed a response to Twickenham's motion to dismiss in which it alleged that, in November 2014, when HAR entered into the security agreement with Magic City, Hockman had executed a guaranty agreement pursuant to which he guaranteed all of HAR's obligations. Magic City further asserted that Hockman had executed and delivered to Magic City a mortgage in which he gave Magic City a lien relative to some of his real property. Magic City alleged that, on June 12, 2018, Hockman sold the real property and remitted payment to Magic City to satisfy his obligations under the guaranty agreement. Magic City argued that, as a surety, Hockman was entitled to enforce Magic City's rights in order to seek reimbursement through subrogation. Magic City further asserted that Hockman, who was not a party, ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.