### IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 07-60511

UNITED STATES OF AMERICA Plaintiff-Appellant FEDERAL INSURANCE COMPANY; PEOPLES FINANCIAL CORPORATION; PEOPLES BANK OF BILOXI Intervenors-Appellants v. RALPH ANGELO SEYMOUR; also known as Sonny Seymour Defendant-Appellee STIFEL, NICOLAUS & COMPANY INC. Garnishee-Appellee JUDY SEYMOUR Interested Party-Appellee

Appeal from the United States District Court for the Southern District of Mississippi USDC No. 1:02-CR-114-1 United States Court of Appeals Fifth Circuit 

### F I L E D April 16, 2008 Charles R. Fulbruge III ClerkNo. 07-60511

* Pursuant to 5

TH C IR . R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5 TH C IR
. R. 47.5.4. 2 Before JOLLY, BARKSDALE, and BENAVIDES, Circuit Judges. PER CURIAM: * Appellants challenge the district court’s ruling that only half of the joint bank account of Ralph and Judy Seymour (husband and wife) is subject to a pending garnishment. At issue is whether it was error to apply Mississippi’s equi table-distribution system for marital property to the garnishment proceeding, providing Judy Seymour an ownership interest in thejoint account. VACATED AND REMANDED. I. Ralph Seymour pleaded guilty to bank fraud, in violation of 18 U.S.C. § 1344. He was ordered, inter alia, to pay $376,705.06 in restitution to Federal Insurance Company, Peoples Financial Corporation, and Peoples Bank ofBiloxi (Intervenors). The United States’ application for writ of garnishment upon Ralph Seymour’s property was served on Stifel, Nicholas & Company, Inc. Stifel answered that $112,473.92 was held in the joint account of Ralph and Judy Seymour. Judy Seymour filed an objection to the garnishment, claiming to be the equitable owner of half of the account’s funds. Intervenors moved for leave to intervene, and for turnover of the funds being held pursuant to the writ of garnishment. Following the district court’sordering the turnover, but then vacating that order, Intervenors again sought turnover. Judy Seymour claimed, underNo. 07-60511

3 Mississippi law, an equitable interest in halfofthe funds, based on her marriage to Ralph Seymour and the funds’ being accumulated during the course of their marriage. She asserted she participated in no wrongdoing, and reaped no benefit from that of her husband. Consistent with Judy Seymour’s position, the district court denied the turnover motion in part, and granted it in part. It ordered half of the funds to be turned over and half to remain in the joint account for the benefit of Judy Seymour. II. Appellants contend the district court abused its discretion in ruling Judy Seymour, under equitable principles, owns halfofthe funds, rendering them not subject to garnishment. “While the entry of a turnover order is reviewed for an abuse of discretion, a district court necessarily abuses its discretion if its conclusion is based on an erroneous determination of the law.” Af-Cap, Inc. v. Republic of Congo, 462 F.3d 417, 425 (5th Cir. 2006), cert. dismissed, 127 S. Ct. 1511 (2007). It goes without saying that state-law determinations are reviewed de novo; in other words, no deference is accorded the district court’s application of Mississippi law

. Salve Regina Colle

ge v. Russell , 499 U.S. 225, 231 (1991); e.g., Af-Cap, 462 F.3d at 425. Under the Federal Debt Collection ProceduresAct, the United States may garnish a debtor’sjointly-owned property to enforce a criminal restitution order to the extent allowed by the law of the State where the property is located. 18 U.S.C. § 3613(a); 28 U.S.C. §§ 3010(a), 3205(a). Thus, Mississippi law controls to what extent Ralph and Judy Seymour’s joint account is subject to this garnishment.No. 07-60511

4 Under Mississippi law, a joint account is prima facie subject to garnishment. Delta Fertilizer, Inc. v. Weaver, 547 So. 2d 800, 803 (Miss. 1989) (citation omitted); see also Deposit Guar. Nat’l Bank v. Pete , 583 So. 2d 180, 183 (Miss. 1991) (citations omitted); Cupi t v. Brooks, 112 So. 2d 813 (Miss. 1959). When claiming a portion of that account exempt from garnishment, the burden is on a joint owner to establish the portion of the funds she owns. E .g. , MISS
. CODE A NN
. § 11-35-41; Delta Fertilizer, 547 So. 2d at 803. For that purpose, “parol evidence is admissible to show the respective contributions of each depositor, as well as any intent o f one to make a gift to the other”. D elta Fertilizer, 547 So. 2d at 803 (citation and internal quotation marks omitted). J udy Seymour does not claim she contributed to, or was given, the account’s funds. Instead, she claims only an e quitable interest in half of the account, based primarily on its being “marital property” accumulated during her long-term marriage to Ralph Seymour, aswell as her lack ofwrongdoing and the family’s current circumstances. She maintains that, under Mississippi law, title to marital property is not determinative of ownership, but rather, the district court had discretion to determine ownership, pursuant to Ferguson v. Ferguson, 639 So. 2d 921 (Miss. 1994) (adopting equity principles to determine title to marital property in divorce proceeding). Therefore, she asserts, the district court relied properly upon Ferguson to conclude she owned an equitable interest in half of the joint-account’s funds, with her half not being subject to the pending garnishment

. As Judy Seymour conceded at oral argument here, however, F erguson’s equitable principles have not been applied by Mississippi courts to garnishment proceedings. F erguson “devised [a] method[] todivide marital assets at divorce”,No. 07-60511

5 id. at 925, and has not been applied outside that context. Accordingly, it was
error for the district court to apply Ferguson to conclude Judy Seymour had equi table title to half the funds. Moreover, even if F erguson’s equitable principles could be applied to a garnishment proceeding, Ferguson advises: “no right to property vests by virtue ofthe marriage relationship alone prior toentry ofa judgment

. . . pursuant to dissolution of the marriage”. I d

. at 928. In sum, Judy Seymour has no vested right in the joint ac count solely by virtue of her marriage to Ralph Seymour. As stated, whether the joint-owner has established ownership of the account is determinative under Mississippi law. E.g., Delta Fertilizer, 547 So. 2d at 803. Ralph and Judy Seymour’s joint account was opened with shares of stock belonging to both of them, and was funded by the liquidation of Ralph Seymour’s retirement account. Judy Seymour has not produced any evidence as to the value of her stock when the account was opened, or any other contributions she made. Nor has she provided evidence that Ralph Seymour gave any funds to her as a gift. Indeed, she claims no legal interest in the funds. Again, her claim rests solely on the marital relationship and equity. Therefore, under Mississippi law, Judy Seymour did not establish ownership ofhalfofthejoint account’s funds. Accordingly, all of those funds are subject to the pending garnishment. III. For the foregoing reasons, thejudgment is VACATED, and this matter is REMANDED todistrict court for entry ofjudgment consistent with this opinion. VACATED AND REMANDED.