Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-almd-2_09-cv-01104/USCOURTS-almd-2_09-cv-01104-0/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 18:1964 Racketeering (RICO) Act

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The motions have been evaluated in light of Rule 12(b)(6)’s standard. See Fed. R. Civ. P.

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12(b)(6); see generally Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (discussing the Rule 12(b)(6)

standard). There is no need to convert the motions to ones for summary judgment, as suggested by Mr.

McDowell (Doc. # 34, at 2), for substantially the same reasons discussed by this court in Crooked Creek

Props, Inc.. v. Ensley, No. 2:08cv1002-WKW, 2009 WL 3644835 at *8 n.16 (M.D. Ala. Oct. 28, 2009)

(order granting motions to dismiss). 

IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF ALABAMA

NORTHERN DIVISION

CROOKED CREEK PROPERTIES, INC., )

 )

Plaintiff, )

 )

v. ) CASE NO. 2:09-CV-1104-WKW [WO]

 )

GEORGE HUTCHINSON, et al., )

 )

Defendants. )

ORDER

Before the court are three motions to dismiss: one filed by Defendant Donald

Hutchinson (Doc. # 20), as amended (Doc. # 35); one filed by Defendant David A.

McDowell (“McDowell”) (Doc. # 24); and one filed by Defendants Donald Hutchison and

George Hutchison, in which they adopt the arguments made by Mr. McDowell (Doc. # 26),

as amended (Doc. # 30). Plaintiff Crooked Creek Properties, Inc. (“Crooked Creek”),

opposes the motions (Doc. # 29), and Mr. McDowell filed a reply (Doc. # 31). Because this

action is barred by res judicata, the motions are due to be granted and this action dismissed

with prejudice.1

This lawsuit is but one more chapter arising from protracted and serial litigation in the

circuit courts of Montgomery and Autauga counties concerning disputed ownership of Danya

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 1 of 10
 Judicial notice is taken of the proceedings in Crooked Creek I and certain pleadings filed in the 2

state court for the limited purpose of determining the applicability of res judicata. See ITT Rayonier Inc.

v. United States, 651 F.2d 343, 345 n.2 (5th Cir. 1981) (“A court may . . . take judicial notice of its own

records.”); see also Fed. R. Evid. 201. Certified copies of the relevant state court pleadings were

submitted in Crooked Creek I. 

 All references to the Autauga County Suit and the Montgomery County Suit are to the state

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court proceedings. Gatewood Walden, Esq., who is counsel of record in this action, represented Crooked

Creek in Crooked Creek I. He also is the son of Willadean Walden, and represented her in the Autauga

County Suit.

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Park Apartments in Autauga County. The court has extensive knowledge of the procedural

and factual underpinnings of this long-running state court litigation because this action is the

second one Crooked Creek has filed in this court. See Crooked Creek Props., Inc. v. Ensley,

No. 2:08cv1002-WKW, 2009 WL 3644835 (M.D. Ala. Oct. 28, 2009) (“Crooked Creek I”)

(order granting motions to dismiss), aff’d, No. 09-15988, 2010 WL 2136027 (11th Cir. May

29, 2010). Although the defendants named in this lawsuit are different from those in 2

Crooked Creek I, both Crooked Creek I and this suit are the product of Crooked Creek’s

frustration with the results of the Autauga County Suit judgment. The defendants in Crooked

Creek I will be referred to as the Ensley defendants. 

The procedural history and factual background of the Montgomery County and

Autauga County suits are set out in more detail in the October 28, 2009 order entered in

Crooked Creek I and will not be repeated here except as necessary. Briefly, Crooked Creek 3

insists that, as a result of prior judgments its predecessor-in-interest (Willadean Walden)

obtained in the Montgomery County Suit, it is the owner of all of the common stock in a

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 2 of 10
 This is one of several rulings in the Montgomery County Suit. Initially, the Montgomery

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County Circuit Court entered a judgment in 2000 vesting Ms. Walden with ownership of all of the

common stock in the corporation that owned Danya Park Apartments. In 2002, however, the

Montgomery County Circuit Court vacated that judgment and instead awarded Ms. Walden a lien on the

common stock. That judgment was affirmed by the Alabama Court of Civil Appeals in 2003, and the

Supreme Court of Alabama denied Ms. Walden’s certiorari petition in April 2004. Thereafter, also in

2004, the parties to the Montgomery County Suit consented to the entry of judgment, vacating the 2002

judgment and reinstating the 2000 judgment that Ms. Walden owned the common stock in the

corporation which owned Danya Park Apartments. According to Crooked Creek, after the entry of the

2004 judgment, Ms. Walden “was the [undisputed] lawful equitable owner of Danya Park Apartments.”

(Pl. Resp. 5 (Doc. # 29).) 

It is notable also that on May 17, 2010, which was after this lawsuit was filed, the Montgomery

County Circuit Court entered an order, declaring the validity of its prior judgments entered in 2000 and

2004 and reasserting that Ms. Walden is the “equitable owner of Danya Park Apartments.” Walden v.

Smith, No. CV-95-1093 (Montgomery County, Ala., Circuit Court, May 17, 2010) (Ex. to Doc. # 33). 

The May 17, 2010 order has spawned yet more litigation in the Autauga County Circuit Court, with that

court entering an order granting a preliminary injunction in favor of the George Hutchison Jr. Trust and

two of the Ensley defendants. The order enjoins Ms. Walden and Crooked Creek from “faxing, mailing

delivering by hand or serving a copy of the Order of the Circuit Court of Montgomery County dated May

17, 2010 upon the Sheriff of Autauga County or in any way attempting to interfere with the ownership or

management of Danya Park . . . Apartments.” E.S. Capital, LLC. v. Walden, No. CV-10-900098

(Autauga County, Ala. Circuit Court, June 11, 2010 (Ex. to Doc. # 34)). It also enjoins them “from

entering upon or having anyone enter upon the property of Danya Park Apartments to assert any

ownership of the Apartments or attempt to exercise any control over the Apartments,” except that the

order “is not intended to disallow the defendants any rights of redemption from the . . . foreclosure to

which they might be entitled under Alabama law.” Id.

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corporation that has as its sole asset Danya Park Apartments. Ms. Walden later learned, 4

however, that a quitclaim deed and a separate mortgage on Danya Park Apartments had been

recorded in the Autauga County Probate Court. The mortgage had been recorded by the

Ensley defendants, and the quitclaim deed by George Hutchison. As to the quitclaim deed,

George Hutchison claimed that in 1998, he was given a quitclaim deed to Danya Park

Apartments from the prior owner, and that in 1999, he transferred the quitclaim deed to a

trust that he created for the benefit of his son (the “George Hutchison Jr. Trust”). Hence, Ms.

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 3 of 10
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Walden commenced proceedings in the Autauga County Circuit Court to remove these

clouds on her title. 

In 2006, the Autauga County Circuit Court disagreed with Ms. Walden’s claim to

ownership of Danya Park Apartments, finding that the 2002 judgment in the Montgomery

County Suit giving Ms. Walden only a lien was the “‘law of the case.’” Crooked Creek I,

2009 WL 3644835, at *4 (quoting Autauga County Suit, Summ. J. Op. 5, dated Dec. 2006).

The Autauga County Circuit Court judgment awarded the Ensley defendants a first mortgage

on Danya Park Apartments superior to Ms. Walden’s lien, and rendered enforceable and

valid a management agreement governing the Ensley defendants’ operation of Danya Park

Apartments and the collection of rent. The Autauga County Circuit Court also found that the

quitclaim deed was in fact an equitable mortgage and amounted to a secondary lien

(“equitable second mortgage”) subject only to the Ensley defendants’ first mortgage lien.

The Supreme Court of Alabama agreed insofar as it held that the George Hutchison Jr. Trust

had a valid secondary lien on Danya Park Apartments. It held, however, that George

Hutchison was judicially estopped (for reasons not pertinent to the present analysis) from

claiming any interest in the quitclaim mortgage on Danya Park Apartments. Walden v.

Hutchinson, 987 So. 2d 1109, 1117-19 (Ala. 2007). Hence, as a result of the Autauga

County Suit judgment, Crooked Creek’s interest in Danya Park Apartments was subordinate

to both the Ensley defendants’ first mortgage lien and the George Hutchison Jr. Trust’s

equitable second mortgage.

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 4 of 10
 Crooked Creek alleges that “it acquired fee simple title to Danya Park Apartments . . . from

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[Ms.] Walden.” (Compl. ¶ 8; see also Compl. ¶¶ 17, 86.) 

 George Hutchison, Donald Hutchison and Mr. McDowell were not named in Crooked Creek I.

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The judgment rendered as a result of the Autuaga County Suit was the catalyst for

Crooked Creek I, which was filed in this court by Crooked Creek, as the successor-in-interest

to Ms. Walden’s ownership interest in Danya Park Apartments. The Ensley defendants and 5

their attorney were among the defendants. In Crooked Creek I, the Ensley defendants 6

argued that, under the doctrine of res judicata, the Autauga County Suit judgment foreclosed

Crooked Creek from reigniting the ownership dispute over Danya Park Apartments in federal

court. The facts and causes of action in Crooked Creek I all pertained to the validity of the

Ensley defendants’ first mortgage and the management agreement. Applying Alabama res

judicata principles, this court found that the Autauga County Suit judgment was a prior

judgment on the merits, rendered by a court of competent jurisdiction, and that it involved

the same subject matter and the same parties (or their privies) as were then before it. The

Eleventh Circuit affirmed the judgment. See Crooked Creek Props., Inc. v. Ensley, No.

09-15988, 2010 WL 2136027 (11th Cir. May 29, 2010). 

Undeterred, in this lawsuit, Crooked Creek sues (1) George Hutchison, (2) Donald

Hutchison, individually and in his capacity as the trustee of the George Hutchison Jr. Trust,

and (3) Mr. McDowell, George Hutchison’s attorney. The first twenty-eight pages of the

Complaint recite the history of the Montgomery County Suit and the Autauga County Suit.

The claims in the present action allegedly arose in the “aftermath of the state court litigation”

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 5 of 10
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(Compl. 28), when George Hutchison, represented by Mr. McDowell, initiated foreclosure

proceedings on the equitable second mortgage on Danya Park Apartments held by the George

Hutchison Jr. Trust. George Hutchison allegedly did so without giving actual notice to

Crooked Creek as the “fee simple” owner of Danya Park Apartments, and notwithstanding

that the George Hutchison Jr. Trust had not “acquired any proprietary interest in Danya Park

Apartments.” (Compl. ¶¶ 8, 17, 86, 111.) Crooked Creek avers that the “underlying

purported quitclaim deed” transferred from George Hutchison to the George Hutchison Jr.

Trust is void for a number of reasons previously litigated in the Autauga County Suit and also

because the Autauga County Suit judgment giving the George Hutchison Jr. Trust an

equitable second mortgage on Danya Park Apartments is void. And, if the Autauga County

Suit judgment that validates the George Hutchison Jr. Trust’s equitable second mortgage “is

itself invalid,” then the “mortgage foreclosure sale is invalid and is due to be set aside.” (Pl.

Resp. 42-43 (Doc. # 29); see also Compl. ¶ 17.) 

By these arguments, Crooked Creek clings to the Montgomery County Circuit Court

judgments giving it, in effect, ownership of Danya Park Apartments. As Crooked Creek

admits, “at the heart of this complaint is Crooked Creek’s belief and contention that the

judgments of the Montgomery [County] Circuit Court are valid, while the judgments of the

Autauga [County] Circuit Court and the state appellate court are . . . void.” (Compl. ¶ 14;

see also Compl. ¶ 3 (As a result of the 2004 “unappealed, unreversed, consent judgment Mrs.

Walden became . . . the equitable owner of Danya Park Apartments.”); Pl. Resp. 41.)

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 6 of 10
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Crooked Creek brings claims to set aside the foreclosure sale (Count One), for

conspiracy to wrongfully foreclose on its property (Count Two), for intentional interference

with Crooked Creek’s business relations with Danya Park Apartments’ tenants (Count

Three), for cancellation of the quitclaim deed (Count Four), for damages flowing from the

wrongful foreclosure (Count Five), and for conspiracy to obtain unjust enrichment (Count

Six).

Defendants argue that the doctrine of res judicata again precludes Crooked Creek

from litigating the matters decided adversely to its predecessor-in-interest (Ms. Walden) in

the Autauga County Suit. Alabama’s law on res judicata applies. See Crooked Creek I,

2009 WL 3644835, at *7-8. “The elements of res judicata, or claim preclusion, are (1) a

prior judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with

substantial identity of the parties, and (4) with the same cause of action presented in both

suits.” Dairyland Ins. Co. v. Jackson, 566 So. 2d 723, 725 (Ala. 1990). “If those four

elements are present, then any claim that was, or that could have been, adjudicated in the

prior action is barred from further litigation.” Chapman Nursing Home, Inc. v. McDonald,

985 So. 2d 914, 919 (Ala. 2007). 

The doctrine of res judicata clearly bars Crooked Creek’s action for substantially the

same reasons espoused in Crooked Creek I. That reasoning is incorporated here so as to

avoid needless repetition. See Crooked Creek I, 2009 WL 3644835, at *7-21. The reasoning

will be summarized.

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 7 of 10
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First, the Autauga County Suit resulted in a valid, final judgment on the merits. The

judgment gave the George Hutchison Jr. Trust an equitable second mortgage on Danya Park

Apartments. 

Second, Alabama’s courts are courts of competent jurisdiction. Nonetheless, Crooked

Creek spends much of its brief arguing that the Autauga County Suit judgment is void for

lack of subject matter jurisdiction and is based upon a misunderstanding of procedural and

substantive rules of law; hence, Crooked Creek contends that the jurisdiction of the Autauga

County Circuit Court (and of the reviewing appellate courts) was not competent. In fact, the

sole argument against the application of the doctrine of res judicata urged by Crooked Creek

is that the doctrine is “inapplicable to void judgments.” (Pl. Resp. 38-40.) This argument

was, however, considered and rejected in Crooked Creek I, and on appeal. See Crooked

Creek, 2010 WL 2136027, at *2 (explaining that the action to quiet title in the Autauga

County Suit gave the circuit court jurisdiction to establish title and that, “even if it were true

that the Autauga Court erred” in its analysis, under Alabama law, “‘the simple fact that a

court has erroneously applied the law does not render its judgment void.’” (quoting Neal v.

Neal, 856 So. 2d 766, 781 (Ala. 2002)); see also Crooked Creek I, 2009 WL 3644835, at *10

(distinguishing between a “void judgment” and an “erroneous judgment” and discussing the

Autauga County Circuit Court’s jurisdiction). For the same reasons, the argument is again

rejected here. 

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 8 of 10
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Third, Alabama’s law on privity, for purposes of res judicata, is elaborated upon in

Crooked Creek I. See 2009 WL 3644835, at *13-18. Based upon application of those

principles here, Crooked Creek and Defendants in this action were parties or privies in the

Autauga County Suit. Crooked Creek has not argued to the contrary.

 Fourth, in this action and in the Autauga County Suit, the primary right asserted by

Crooked Creek and Ms. Walden is the alleged right to unencumbered ownership of Danya

Park Apartments, while the primary wrong centers on Defendants’ interference with that

ownership. The interference in this case, as in the Autauga County Suit, includes the

quitclaim deed (i.e., the equitable second mortgage) on Danya Park Apartments, and the

principal contention is that the quitclaim deed is void. (Compare Autauga County Suit,

Compl. ¶ 24 (“Hutchison’s quitclaim deed is absolutely void.”), with Compl. ¶ 6

(enumerating six reasons why the quitclaim deed is void).) Parallel relief also is sought. In

this case, “Crooked Creek . . . seeks to cancel defendants’ unlawful and illegal ‘equitable

mortgage’ or to have it declared inoperative and void.” (Compl. ¶ 6.) Similarly, the Autauga

County Suit complaint sought a judgment declaring that Ms. Walden “ha[d] the entire

undivided fee simple interest in and to [Danya Park Apartments] with no restrictions

thereon.” (Autauga County Suit Compl. 20.) While Crooked Creek crafts some of its legal

theories differently in this lawsuit (focusing on an alleged wrongful foreclosure), it merely

is attempting to do indirectly what it cannot do directly – attack the validity and

enforceability of the quitclaim deed held by the George Hutchison Jr. Trust. Both lawsuits

Case 2:09-cv-01104-WKW-WC Document 37 Filed 09/10/10 Page 9 of 10
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concern the same subject matter (i.e., ownership control of Danya Park Apartments), and

revolve around the same nucleus of operative facts. For these reasons, the causes of action

are the same for res judicata purposes. 

Accordingly, all of the res judicata elements under Alabama law are satisfied, and

Crooked Creek is precluded from relitigating the claims it has brought in this suit.

Defendants’ arguments for dismissal on the merits, therefore, need not be addressed,

although they are persuasive.

For the foregoing reasons, it is ORDERED that Defendants’ motions to dismiss (Docs.

# 20, 24, 26, 30, 35) are GRANTED, and that this action is DISMISSED with prejudice, as

barred by the doctrine of res judicata. 

All remaining motions are DENIED as moot.

An appropriate judgment will be entered. 

DONE this 10th day of September, 2010.

 /s/ W. Keith Watkins 

 UNITED STATES DISTRICT JUDGE

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