Opinion ID: 1678730
Heading Depth: 1
Heading Rank: 4

Heading: 85-1032 Adams v. Green

Text: On February 21, 1986, the Operatives filed a motion entitled Motion Under Rule 60, Alabama Rules of Civil Procedure For Relief From Judgment And To Declare Judgment Void And For Preliminary Injunction. By that motion, the Operatives sought to set aside and/or obtain relief from a decree entered on April 6, 1942, in the case of Moore v. Hardin, Case No. 53715 (10th Jud.Cir. of Ala., Equity, 1942). The bill of complaint filed in Moore v. Hardin by the ACIPCo board of trustees in 1942 named as respondents 12 ACIPCo employees, both white and black, employed in each of the various departments of ACIPCo, and alleged that all 1,500 ACIPCo employees could not be made respondents without great inconvenience, ... expense, and ... oppressive delays, and further alleged that the interest of all and each of said [ACIPCo] employees ... in the subject matter of this suit is the same, and the failure to make other employees parties to this cause will not adversely affect any of the rights of any of said employees as such employees if a proper representation of employees be made parties hereto. After generally averring the origin, history, and composition of the ACIPCo board of trustees, the trustees alleged that their number is comparatively large, and that the individual members changed from time to time, especially ... the members of the Board of Operatives, who are elected by the employees of the Company. The trustees, therefore, believed that they needed a set of rules and regulations for guidance in performing their duties as trustees. In accord with that belief, the 1942 trustees, predecessors to the parties herein, adopted a set of rules and regulations at the February 1942 board of trustees meeting, of which, by their complaint, they sought court approval. Specifically, the trustees sought instructions from the court as to their administration of the trust and a declaration of their rights, particularly as to 1. Whether or not your complainants as such trustees in the proper management and conduct of said trust have the right and authority to adopt reasonable rules and regulations which will govern the conduct of said trust and the actions of your complainants and their successors as trustees in the management and conduct of such trust. 2. Whether or not in the opinion of this court the rules and regulations submitted herewith, marked Exhibit G, are reasonable and proper rules and regulations to be adopted by the trustees, and, if so, that this court will duly approve same. The trustees also asked the court to decree that the 12 employees named respondents represented the interests of all ACIPCo employees. Each of the respondents individually executed a joint acceptance of service on April 2, 1942, stating as follows: We hereby accept service of summons in the above-styled cause and do hereby waive any and all further notice of the filing of the bill of complaint in this cause and do agree that said case may be heard immediately. An answer was also filed by Smyer & Smyer, as solicitors for respondents; that answer admitted certain of the allegations of the complaint and neither admitted nor denied certain others. The respondents also joined with the complainants in asking for instructions and directions as to the proper administration of the trust, and put in issue the question of whether or not the trustees have the right and authority to adopt reasonable rules and regulations governing the conduct of the trust, and the action of the trustees and their successors in the management and conduct of the trust. Under the rules of procedure and practice in force at that time, the cause was submitted on the bill of complaint and exhibits, the answer, and the testimony of witnesses whose testimony had been taken down by a commissioner and submitted in writing. Based on this submission, the trial court entered a lengthy order in which it found, inter alia, that the 12 employees named as respondents were sufficiently representative of all classes of ACIPCo employees, and that it was, therefore, unnecessary to make any other employees respondents to the cause. The court further found that it was desirable, and, in fact, necessary to the proper operation of the Eagan plan for the trustees to have suitable rules and regulations for the government of the board of trustees and that the trustees had the right and authority to adopt such rules and regulations. The court then specifically decreed that: The rules and regulations adopted by complainants as such trustees are reasonable and proper rules and regulations to be adopted by them as such trustees and said rules and regulations are hereby in all things approved, and the complainants and their successors as such trustees are ordered to be governed and directed by said rules and regulations in their conduct of said trust. No appeal was taken from this order, and the trustees have been governed by the rules and regulations approved therein since April 6, 1942. By their Rule 60(b) motion, the Operatives sought to have this 1942 order set aside and declared void, alleging as grounds the following: (a) the court lacked jurisdiction; (b) the order promulgates a racially discriminatory scheme of trust management and control; (c) no guardian ad litem had been appointed to represent the interests of future beneficiaries and minor beneficiaries of the trust; (d) it purports to adjudicate the rights of parties not before the court; (e) the decree was entered in violation of the then applicable rules of law; and (f) the proceedings were devoid of fundamental compliance with the requirements of procedural and substantive due process. By order dated March 7, 1986, the trial court denied the Operatives' request for a preliminary injunction. Then, on May 29, 1986, the trial court entered an order designated an Order Denying Preliminary Injunction on the Merits. The substance of this order, however, deals exclusively with the merits of the Operatives' request for Rule 60(b) relief; within the body of the order, there is no discussion whatsoever of the criteria applicable to motions for preliminary injunctions nor of whether the Operatives are entitled to preliminary injunctive relief. In its order, the trial court discussed only the merits of the grounds alleged by the Operatives in support of their Rule 60(b) motion, and thereby denied that motion. The parties have so construed this order in their respective briefs and arguments to this court. Therefore, despite its denomination and the language of the mandate at the end, we treat this order according to its substance rather than its form and consider it as an adjudication ( i.e., a denial) of the Operatives' Rule 60(b) motion. Management correctly states the standard of review applicable to a trial court's decision to grant or deny a Rule 60(b) motion for relief from judgment: A strong presumption of correctness attaches to the trial court's determination of a motion made pursuant to Rule 60(b), and the decision whether to grant or deny the motion is within the sound discretion of the trial judge, and the appellate standard of review is whether the trial court abused its discretion. Pierson v. Pierson, 347 So.2d 985 (Ala.1977). In reviewing a ruling of a trial court on a Rule 60(b)(6) motion, the trial court's decision will not be disturbed unless it is determined `that there is an absence of reasonable cause, that rights of others subsequently arising would be adversely affected, or that it is unjust.' [Citations omitted.] Ex parte Dowling, 477 So.2d 400, 402-03 (Ala.1984). Having reviewed the record in this case, along with the respective arguments of the parties and the applicable authorities, we cannot say the trial court abused its discretion in denying the Operatives' motion to set aside a judgment entered almost 44 years ago. Indeed, under Alabama law, the only ground that can be asserted to set aside a 44-year-old judgment is that the judgment is void on its face. See Sweeney v. Tritsch, 151 Ala. 242, 44 So. 184 (1907). However, a judgment cannot be void when the Court has jurisdiction of the parties and the subject matter. Raine v. First Western Bank, 362 So.2d 846, 849 (Ala.1978). The Operatives contend that the court in Moore v. Hardin, supra, had neither subject matter jurisdiction nor jurisdiction of all the necessary parties. Specifically, they contend the judgment is void because: (1) no guardian ad litem was appointed to represent minor beneficiaries and absent beneficiaries and trustees; (2) the necessary parties were not before the court; and (3) there was no case or controversy. As to these three reasons, the trial court held as follows: Counsel for the plaintiffs is in error in stating that a justiciable controversy must be alleged and shown before this Court can take jurisdiction over a request by a trustee for instructions in the administration of a trust. See, e.g., Peach v. First Nat'l Bank of Birmingham, 247 Ala. 463, 25 So.2d 153 (1946); Thurlow v. Berry, 247 Ala. 631, 25 So.2d 726 (1946); Kimbrough v. Dickinson, 247 Ala. 324, 24 So.2d 424 (1946); Dallas Art League v. Weaver, 240 Ala. 432, 199 So. 831 (1941). In Peach, supra, the Court quoted with approval the following: `As a general principle when a trustee is in reasonable doubt as to the extent of his powers or as to the proper manner in which to proceed under the trust, he may apply to a court of equity, which will interpret the trust instrument when necessary and when it is ambiguous in order to give him directions without other equity appearing in the bill.' In Bogert, The Law of Trusts & Trustees, § 559 (2d Rev.1980), the following is provided: `Equity has jurisdiction over all matters relating to trust property, and in the execution and administration of the trust, in all cases of doubt as to their rights and liabilities and what their conduct should be, trustees are entitled to and should seek instruction and direction from the court.' .... In Ex parte Nick Johnson, [481 So.2d 353 (Ala.1985)], ACIPCO filed a petition in the Tenth Judicial Circuit requesting the Presiding Judge to appoint an attorney to preside over the meeting of the Board of Directors of ACIPCO as provided for in the rules and regulations quoted in this opinion. The Court appointed an attorney to preside over the meeting without notice having been given to any other party. Three days later, members of the Board of Operatives filed a motion to vacate the appointment. When this motion was denied, the Board of Operatives filed a petition for writ of mandamus with the Supreme Court of Alabama seeking to require the circuit court to vacate the appointment. The Supreme Court granted the writ, but only on the ground that the members of the Board of Operatives were entitled to reasonable notice and an opportunity to be heard in opposition to the application. The Supreme Court there stated: `We do not agree with the petitioners' contention that the court below lacked subject matter jurisdiction. As we view the matter, the court acquired jurisdiction in the 1942 declaratory judgment action and, by approving and adopting the rules and regulations of the Board of Trustees, it retained jurisdiction over the trust, the corpus of which is all located in Jefferson County....' This Court also agrees with ACIPCO that it was not necessary in 1942 that every employee of ACIPCO be made a party or that a guardian ad litem had been appointed by the Court to represent future employees or those who were minors. Equity Rule 30 provided in part as follows: ` When parties are numerous, court may proceed, having before it parties to represent adverse interests. When the parties having vested interest in real or personal property are very numerous, and cannot, without manifest inconvenience and oppressive delays in the suit, be all brought before it, the court, in its discretion, may dispense with the making of all of them parties, and may proceed in the suit, having sufficient parties before it to represent all the adverse interests of the plaintiff and the defendant in the suit. But in such cases the decree shall be without prejudice to the rights of the absent parties in that they may claim their shares of any funds in court, or if paid out by order of court, may recover their shares from parties to whom such funds have been so paid.' Similarly, Title 7, Section 128, Alabama Code 1958, provided: `In equity of the parties to the action, those who are united in interest must be joined as plaintiffs or defendants; if the consent of any one who should have been joined as a plaintiff cannot be obtained, he may be made a defendant, the reason thereof being stated in the bill of complaint, and when the question is one of a common or general interest of many persons, or where the parties are numerous, and it is impracticable to bring them all before the court, one or more may sue or defend for the benefit of all.' That part of the rules and regulations of which the plaintiffs complain merely sets out a procedure for resolving a dispute occurring between the two units of the Board of Trustees. The Court agrees with ACIPCO that all of the employees were not necessary parties to the 1942 action. We agree with the trial court that requirements of both personal and subject matter jurisdiction were met in this case. With respect to the Operatives' contention that necessary parties (including a guardian ad litem representing minor and absent beneficiaries and trustees) were not before the court, we point out that this issue of the sufficiency of naming only 12 employees as respondents was specifically adjudicated by the trial court in 1942. The issue was raised in the petition by the petitioners, and the trial court ruled as follows: 3. The beneficiaries of the trust created by said codicil to the will of John J. Eagan are the employees of American Cast Iron Pipe Company. These employees at the present time are more than one thousand five hundred in number. All of said employees reside in Jefferson County, Alabama, with the exception of a few employed at branch sales offices. All of the trustees reside in Jefferson County, Alabama. It is impracticable to make all of the employees of American Cast Iron Pipe Company respondents to this cause. To do so would cause great inconvenience, great expense, and oppressive delays in hearing this cause, and would result in no useful purpose. Twelve of said employees have been made respondents and are represented by their solicitor of record. They are employed in the various departments of the plant of the American Cast Iron Pipe Company and perform various classes of work. Some of said respondents are white employees and some are negro employees. The interest of all of the employees of American Cast Iron Pipe Company in the subject matter of this suit is the same, and the court finds that the employees named respondents are sufficiently representative of all classes of such employees, and that it is unnecessary to make any other of such employees respondents to this cause.  (Emphasis added.) It is well-settled that the denial of a 60(b) motion does not bring up for review on appeal the correctness of the judgment which the movant seeks to set aside, but is limited to deciding the correctness of the order from which he appeals. (Emphasis added.) Raine v. First Western Bank, 362 So.2d at 848. Accordingly, the issue of whether the named respondents sufficiently represented the interests of those whose interests the Operatives now claim were not represented, is not properly reviewable in these proceedings. On their face, the 1942 proceedings disclose that the court acquired personal jurisdiction over those employees named respondents; the document evidencing service of process is valid on its face. Furthermore, we agree with and adopt the trial court's order determining that the equity court had subject matter jurisdiction over the petition filed in 1942. Additional authority for that holding includes the following: Bogert, The Law of Trusts & Trustees, § 559 (Rev.2d ed. 1980): As a part of its general jurisdiction over trusts, the court of equity has power to instruct and advise the trustee as to his powers and duties, on his request or at the request of a beneficiary. Hence many doubts arising from ambiguity of the trust instrument or uncertainty of the law regarding the powers of a particular trustee may be resolved. (Emphasis added.) Gilmer v. Gilmer, 245 Ala. 450, 453-54, 17 So.2d 529, 531 (1944): As a general principle when a trustee is in reasonable doubt as to the extent of his powers or as to the proper manner in which to proceed under the trust, he may apply to a court of equity, which will interpret the trust instrument when necessary and when it is ambiguous in order to give him directions without other equity appearing in the bill.... Collins v. Morgan County National Bank, 226 Ala. 376, 379, 147 So. 161, 163 (1933), quoting 1 Pom.Eq., § 352: [T]he rule is well understood that: `Whenever there is any bona fide doubt as to the true meaning and intent of provisions of the instrument creating the trust or as to the particular course which he ought to pursue, the trustee is always entitled to maintain a suit in equity at the expense of the trust estate, and obtain a judicial construction of the instrument and directions as to his own conduct.'... The Operatives also claim that the 1942 decree is due to be set aside on account of fraud. Under Rule 60(b)(3), motions to set aside a judgment because of fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party must be brought not more than four months after the judgment, order, or proceeding was entered or taken. Rule 60(b), however, goes on to provide that: This rule does not limit the power of a court to entertain an independent action within a reasonable time and not to exceed three years after the entry of the judgment (or such additional time as is given by §§ 6-2-3 and 6-2-8, Code of Ala.) to relieve a party from a judgment, order, or proceeding, or to set aside a judgment for fraud upon the court. ... Clearly, even under § 6-2-3, Code of 1975, the Operatives' claim for fraud upon the court is barred because, without question, more than two years prior to their filing of this action, the Operatives knew or should have known of the facts they alleged constituted fraud. This is especially true of the Operatives' claim that in 1942 the petitioners misrepresented to the court that the copy of Mr. Eagan's codicil attached to the bill of complaint was as Mr. Eagan wrote it. In other words, the Operatives contend that it was fraud upon the court not to specifically aver that modifications to the codicil had been made when the will was probated in Georgia in 1924. Eagan v. Moore, supra. We think that by using reasonable diligence, the Operatives could have discovered this alleged fraudulent omission far sooner than 43 years after the filing of the petition by the trustees in 1942. In further support of their fraud claim, the Operatives offered the affidavit of James Whitehead, who was one of the 12 respondent/employees in Moore v. Hardin, supra. In his affidavit, Whitehead states the following: The document which is attached to this affidavit [the joint acceptance of service] bears my signature. I remember signing the document in 1942 but I was not told at that time what the document was nor was I told that it had anything to do with any court proceedings. The circumstances which led up to my signing the document which is attached to this affidavit are as follows: ... I learned that there was going to be an opening in the company's `YMCA Building.' ... This job which I was interested in, in the YMCA Building was a white collar job. ... I was very interested in moving from the No. 2 ramming station in the monocast department to this white collar position in the YMCA Building and so I applied for the YMCA job opening. After I applied for the YMCA job, my supervisor on the No. 2 ramming station in the monocast department, Mr. Eugene Sparkman, approached me and asked if I would sign a document which he said would state that I approved of the Eagan plan.... He said that I would have to sign a document which stated that I pledged to uphold the Eagan plan if I wanted to get the YMCA job. He told me to go to Mr. Dyer's office to sign the document he was talking about. ... When I got to Mr. Dyer's office, Mr. Dyer stated that he had been expecting me and he already had a document on his desk which I was supposed to sign. Mr. Dyer asked me to sign the document. A copy of that document is attached to this affidavit. I did not read this document before I signed it because I was told that it only said that I pledged to uphold the Eagan plan. Neither Mr. Sparkman nor Mr. Dyer ever told me that the document which I was asked to sign and which I did sign had anything to do with any court case. I was never asked if I was willing to represent other blacks or other employees of ACIPCO. I never saw or heard any testimony of any kind from W.D. Moore, Henry J. Noble, C.D. Parr, A.J. Bryant, Sr., or Lawton B. Bascomb. I never saw or met any lawyer named Smyer nor did I ever see or meet or talk with any lawyer at all about any court case or about anything in connection with my signing of the document in question. I was never told that any lawyer named Smyer or any other lawyer was representing me. (Emphasis added.) First of all, Whitehead's affidavit does not support the Operatives' claim for fraud on the court. See Duncan v. Johnson, 338 So.2d 1243 (Ala.1976); Bolden v. Sloss-Sheffield Steel & Iron Co., 215 Ala. 334, 110 So. 574 (1925). Rather, if these facts establish anything, it would be only that a fraud was perpetrated upon one of the respondents, not upon the court, and such a fraud claim falls under Rule 60(b)(3), which must be brought within four months after judgment is entered. Furthermore, even if these facts constituted a fraud upon the court, that claim is clearly barred by § 6-2-3, supra, because the fact of the purported fraud could have been readily discovered by Whitehead had he read the acceptance of service at the time he signed it on April 2, 1942. See Sharpe v. Crook Realty Co., 508 So.2d 262 (Ala.1987); Gonzales v. U-J Chevrolet Co., 451 So.2d 244 (Ala.1984); Torres v. State Farm Fire & Casualty Co., 438 So.2d 757 (Ala.1983); Sexton v. Liberty National Life Ins. Co., 405 So.2d 18 (Ala.1981); Seybold v. Magnolia Land Co., 376 So.2d 1083 (Ala.1979). See also Myers v. Geneva Life Ins. Co., 495 So.2d 532 (Ala.1986). The Operatives also attempted to have the 1942 judgment set aside because, at that time, the trust was racially discriminatory. We find the reasoning of the trial court on this issue to be correct and herewith adopt that portion of the trial court's order set out below: It is true, as counsel for the Board of Operatives states, that certain provisions of the rules and regulations adopted under the Eagan trust have been found to be in violation of the 1964 Civil Rights Act and in violation of the Constitution. In Pettway v. American Cast Iron Pipe Co., 322 [332] F.Supp. 811 (N.D.Ala.1970) [reversed and remanded on other grounds, 474 [494] F.2d 211 (5th Cir. 1974)], the federal district court held that the racial restriction on membership on the Board of Operatives to `white men only' was unlawful and `must be removed.' However, the federal district court also stated: `... The Board of Operatives will continue to operate and to carry out its functions as an integral part of the Eagan plan with its members serving as joint stockholders and co-trustees under the Eagan codicil as in the past, subject, however, to the eliminating of the racial restrictions on its members. The court further finds that upon the elimination of the racial restriction on membership to the Board of Operatives, the continued and separate existence of the Advisory Auxilliary Board composed of negro employees only and elected by negro employees only would be unnecessary and the court holds that the continuation of such separate Auxilliary Board would also constitute a violation of Title VII. Therefore, the Auxilliary Board must be abolished simultaneously with the elimination of the racial restriction on membership of the Board of Operatives. `The elimination of the racial restriction on the Board of Operatives, together with disestablishment of the separate Auxilliary Board will, in the opinion of the court, provide all employees of the company an equal opportunity regardless of the race or color to vote for representatives on the Board of Operatives and to serve on the Board of Operatives. Furthermore, in the future, the members of the Board of Operatives, elected and serving without regard to race or color, will be able to appoint all members of the standing committees and special committees of the Board of Operatives without being in violation of the provisions of Title VII.' At a subsequent evidentiary hearing, the federal district court approved a plan submitted by ACIPCo for the purpose of carrying out the directives of the Court. The plan of compliance enlarged the number of electoral districts from five to twelve and provided for the the election of one representative on the Board of Operatives for each district. The Court concluded: `The Court feels that it should not, and it will not, engage in a presumption that employees elected from fair and properly drawn electoral districts, will not fairly represent the interest and rights of employees of another race or color and faithfully serve as trustees under Mr. Eagan's will. ...' In short, the federal district court did not conclude that the Eagan plan was invalid or that this Court's decree rendered in 1942 was invalid because of racially restrictive provisions contained in the original plan. Instead, the Court ordered the removal of those restrictions and then approved the plan as being in compliance with the Civil Rights Act. It is not for this Court at this time to conclude that this Court's decree rendered in 1942 interpreting the plan is invalid because racial restrictions since removed were left in place in 1942. Finally, the Operatives argue in effect that the totality of their arguments justifies granting them relief from the 1942 judgment under Rule 60(b)(6). They contend that the effect of the 1942 decree frustrates Mr. Eagan's basic intent in that it allows Management trustees to assume absolute and unbridled control over the trust estate. Farlow v. Adams, 474 So.2d at 58. Although the trial court did not specifically address the Operatives' Rule 60(b)(6) claim, we agree with Management that the Operatives have not demonstrated compelling and extraordinary circumstances entitling them to Rule 60(b)(6) relief. Furthermore, a Rule 60(b)(6) motion must be based on some reason other than those stated in Rule 60(b)(1) through (5), and there is the additional requirement that a Rule 60(b)(6) motion be brought within a reasonable time after entry of judgment. As explained by the Seventh Circuit in its discussion of the reasonable time requirement of Rule 60(b) in Planet Corp. v. Sullivan, 702 F.2d 123, 126 (7th Cir.1983), [w]hat constitutes `reasonable time' depends on the facts of each case, taking into consideration the interest in finality, the reason for delay, the practical ability to learn earlier of the grounds relied upon, and prejudice to other parties. (Quoting Ashford v. Steuart, 657 F.2d 1053, 1055 (9th Cir.1981)). (Emphasis added.) It clearly appears that if the rules and regulations approved in the 1942 decree permitted the Management to exercise absolute and unbridled control over the trust estate, that result should have been evident to the Operatives much sooner than almost 43 years later. Accordingly, we hold that the Operatives' Rule 60(b)(6) motion is untimely and, therefore, the trial court did not abuse its discretion in denying the motion. Based on the foregoing, the judgments below are due to be, and they hereby are, affirmed. AFFIRMED. MADDOX, JONES, SHORES and HOUSTON, JJ., concur.