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2005-UP-022 - BB&T v. Simpson
PER CURIAM:

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS
PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Ex Parte:

Christine A. Dunagin, Respondent,

In Re:

BB&T Bankcard Corporation, Appellant,

v.

Mike Simpson, Jr. and Eula L. Simpson, Defendants.


Appeal From Pickens County
Henry F. Floyd, Circuit Court Judge


Unpublished Opinion No. 2005-UP-022
Submitted November 1, 2004 – Filed January 13, 2005


AFFIRMED


John William Ray, of Greenville, for Appellant.

Rodney Wade Richey, of Greenville, for Respondent.


PER CURIAM:  BB&T Bankcard Corporation (BB&T) appeals the circuit court’s denial of its motion for attorney’s fees and costs against Christine A. Dunagin pursuant to Rule 11, SCRCP.  We affirm. [1]

FACTS

BB&T brought a breach of contract action against Mike and Eula Simpson after the Simpsons defaulted on their credit card agreement.  The Simpsons, through their counsel, Dunagin, responded with a general denial, and further stated they had retained counsel for the purpose of filing bankruptcy, “in which this matter will be dealt with.”  BB&T moved for summary judgment or in the alternative to strike claiming the answer was filed for delay and violated SCRCP 11(a).  BB&T also proceeded with discovery and served interrogatories on the Simpsons. 

Dunagin wrote BB&T’s counsel, acknowledging receipt of discovery requests and informing him “it is estimated that the Simpsons will be filing for Chapter 13 bankruptcy protection within 1 to 2 weeks, therefore, we will not be responding to the discovery requests.”  Counsel responded by noticing the Simpsons’ depositions.  Three days prior to the scheduled depositions, Dunagin again wrote to BB&T’s counsel informing him the Simpsons had filed a bankruptcy petition under Chapter 13, thereby staying BB&T’s action against them.  Counsel filed a motion for sanctions pursuant to Rule 11, SCRCP, claiming the Simpsons’ answer “was filed and served in bad faith and purely for delay, and the Plaintiff is entitled to an award of fees and costs from attorney Dunagin as a matter of law.”  Following a hearing, the trial court denied the motion for sanctions in a form order without assigning specific reasons for the denial. 

DISCUSSION

BB&T argues the trial court erred in denying its motion for attorney’s fees and costs pursuant to Rule 11, SCRCP.  We disagree.

The criteria for awarding sanctions pursuant to Rule 11 are essentially the same as those for sanctions under the Frivolous Civil Proceedings Act.  Father v. SCDSS, 353 S.C. 254, 262, 578 S.E.2d 11, 15 (2003).  The decision whether to impose sanctions under the FCPSA sounds in equity rather than at law.  Id. at 260, 578 S.E.2d at 14.  In such an action, an appellate court has jurisdiction to find facts in accordance with its own view of the preponderance of the evidence.  S. C. Const. Art. V, § 5; see also Townes Assocs. Ltd. v. City of Greenville, 266 S.C. 81, 86, 221 S.E.2d 773, 775 (1976).  However, following a determination of the facts, an appellate court applies an abuse of discretion standard in reviewing the decision to award sanctions and the specific sanctions awarded.  Father, 353 S.C. at 261, 578 S.E.2d at 14. 

Rule 11(a), SCRCP provides in part:

The signature of an attorney or party [on a pleading, motion or other paper] constitutes a certificate by him that he has read the pleading, motion or other paper; and that to the best of his knowledge, information and belief there is good ground to support it; and that it is not interposed for delay.

Under the rule, the court may sanction an attorney for filing a pleading in bad faith (i.e., to cause unnecessary delay) irrespective of whether there is good ground to support it.  Runyon v. Wright, 322 S.C. 15, 19, 471 S.E.2d 160, 162 (1996).  The sanction may include an order to pay the reasonable costs and attorney’s fees incurred by the party or parties defending against the action brought in bad faith.  Id.; Rule 11(a) SCRCP. 

Here, BB&T argues the “sole purpose of the Answer was to detain and impair the authority of the lower court and to delay and generate further injury to the opposing party.”  As evidence of bad faith, BB&T points to Dunagin’s general denial of the allegations contained in its complaint, and her later decision not to respond to discovery requests. 

The circuit court did not make specific findings of fact or rule on BB&T’s allegations of bad faith in filing the answer. The court’s order simply stated, “Plaintiff’s Motion for Sanctions is DENIED.”  The record does not indicate and BB&T does not contend it filed a 59(e) motion asking the court to provide the factual basis for its ruling or address BB&T’s allegations of bad faith. 

However, the Simpsons’ answer clearly disclosed their intention to file for bankruptcy protection under Chapter 13.  Dunagin’s later correspondence with BB&T explained the decision not to respond to discovery requests was in anticipation of the Simpsons’ petitioning for bankruptcy.  We hold these facts support the court’s conclusion that Dunagin did not engage in sanctionable behavior in this case.  The record reveals her willingness to disclose, at the first opportunity, the intention of her clients to seek bankruptcy protection.  Consequently, after carefully reviewing the factual circumstances, we hold the circuit court did not abuse its discretion in denying BB&T’s motion for sanctions pursuant to Rule 11, SCRCP. 

AFFIRMED. 

ANDERSON, STILWELL, and SHORT, JJ., concur. 


[1]         We decide this case without oral argument pursuant to Rule 215, SCACR.