Gaslowitz v. Stabilis Fund I, LP
331 Ga. App. 152
| Ga. Ct. App. | 2015Background
- Stabilis Fund I obtained a $1,621,132.78 judgment in Fulton County against Adam Gaslowitz and two others; Gaslowitz is sole member of G&A, LLC.
- Stabilis filed a post-judgment petition seeking a charging order against Gaslowitz’s membership interest in G&A, LLC and an accounting of G&A, LLC’s assets/proceeds; it moved for partial summary judgment on those claims.
- At summary judgment Stabilis averred the judgment remained unpaid; appellants produced evidence that about $848,000 had been collected via foreclosures and garnishments but the exact remaining balance was not established.
- Trial court granted summary judgment: issued a charging order against Gaslowitz’s LLC interest and ordered an accounting of G&A, LLC’s assets; later required appellants to post a $962,257.60 supersedeas bond to preserve appeal.
- On appeal the court affirmed the charging order, reversed the accounting requirement, affirmed the bond as to Gaslowitz, and reversed the bond as to G&A, Inc. and G&A, LLC.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether summary judgment may issue for a charging order absent proof of exact unpaid balance | Stabilis: need only show it is a judgment creditor; exact unpaid amount not required to obtain charging order | Appellants: trial court erred because Stabilis did not prove amount remaining unpaid and order is vague as to distributions | Held: Affirmed charging order; statute does not require showing exact unpaid balance at issuance; charge runs until judgment with interest satisfied |
| Whether the charging order is impermissibly vague about distributions and duration | Stabilis: order inherently limited to unsatisfied judgment so clarity is sufficient | Appellants: order fails to state what distributions are due or when distributions may resume to debtor | Held: Not vague; charging order limited by statute to the unsatisfied judgment amount and can be extinguished when judgment satisfied |
| Whether Stabilis is entitled to an accounting of G&A, LLC’s assets | Stabilis: accounting needed to identify assets/proceeds to satisfy judgment and as a matter of right as assignee | Appellants: LLC assets are not subject to member’s creditor; no statutory right to company accounting here | Held: Reversed accounting order; charging order gives only assignee-like rights to distributions, not a right to company asset accounting or to reach company property |
| Whether appellants must post supersedeas bond and in what amount; which parties are liable | Stabilis: bond appropriate to protect disposition-of-property interest created by charging order; amount may consider underlying money judgment | Appellants: no appeal from a money judgment here; bond improperly ties to different-party judgment and improperly requires G&A entities to post | Held: Bond requirement affirmed as to Gaslowitz (charging order affects his property); reversed as to G&A, Inc. and G&A, LLC because they are not judgment debtors and charging order does not dispose of their property |
Key Cases Cited
- Matjoulis v. Integon Gen. Ins. Corp., 226 Ga. App. 459 (1997) (summary judgment standard and de novo review)
- Prodigy Centers/Atlanta v. T-C Assocs., 269 Ga. 522 (1998) (charging order as statutory remedy for judgment creditor of member)
- Word v. Stidham, 271 Ga. App. 435 (2004) (LLC interest is personal property; charging order does not reach company assets)
- Nigri v. Lotz, 216 Ga. App. 204 (1995) (creditor by charging order entitled to distributions to satisfy judgment)
- Sampson v. Haywire Ventures, 293 Ga. App. 779 (2008) (standard for obtaining corporate accounting)
- Acree v. McMahan, 276 Ga. 880 (2003) (third-party creditor may not reach corporate assets by disregarding entity form)
- Duke Galish, LLC v. SouthCrest Bank, 314 Ga. App. 801 (2012) (supersedeas bond may secure disposition-of-property interests)
- Cloud v. Georgia Central Credit Union, 214 Ga. App. 594 (1994) (trial court’s discretion on supersedeas bond and factors to consider)
- Mahalo Investments III v. First Citizens Bank & Trust Co., 330 Ga. App. 737 (2015) (jurisdiction need only be over judgment debtor to enter charging order)