BRIEF FOR APPELLANT: J. Russell Lloyd Louisville, Kentucky BRIEF FOR APPELLEE: Charles D. Brown, Jr. Louisville, Kentucky
NOT TO BE PUBLISHED APPEAL FROM JEFFERSON FAMILY COURT
HONORABLE GINA KAY CALVERT, JUDGE
ACTION NO. 01-FC-006018 OPINION
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BEFORE: COMBS, JONES, AND K. THOMPSON, JUDGES. THOMPSON, K., JUDGE: Janice Mooney appeals from a judgment of the Jefferson Family Court denying post-judgment interest on a March 18, 2002 judgment for child support arrearages. The family court ruled that the March 18, 2002 judgment did not award post-judgment interest and imposing the statutory post-judgment interest rate almost fifteen years later would be inequitable. We conclude the family court did not abuse its discretion when it declined to impose post-judgment interest where the 2002 judgment was silent as to post-judgment interest and Janice did not seek to enforce the judgment until 2016.
Don Jones and Janice were divorced by decree of dissolution entered on November 13, 1980. There were two children born of the marriage. Pursuant to the property settlement agreement, Don initially paid monthly child support in the amount of $450. That amount was later decreased to $310 and then increased to $375 per month and remained that amount until the youngest child was emancipated in July 1994. Don was also required to maintain hospitalization insurance and pay half the uninsured medical and dental expenses for the children.
Over the years after the entry of the decree, various judgments were entered, including a 1988 common law judgment for $9,616.75 representing child support arrears and medical expenses and reimbursement through January 31, 1988, and another common law judgment in November 1993 for $8,334 representing child support arrearages from February 1, 1988, through October 1, 1993. A third common law judgment for $1,308, representing child support arrears from October 1, 1993, through July 1994, when the youngest child became emancipated, was entered on August 18, 1995.
On September 17, 2001, Janice filed a motion seeking reimbursement from Don for medical expenses totaling $7,736.76. This amount included costs incurred from 1983 to 1993, periods previously addressed through the January 31, 1988 judgment and the August 18, 1995 judgment.
Don did not appear, and the domestic relations commissioner filed a report and recommended that Janice be awarded a common law judgment against Don in the amount of $7,736.76. The domestic relations commissioner further recommended that Janice be award a common law judgment against Don for child support arrearages in the amount of $30,107.98.
Although Janice did not request arrearages in her motion, she did so at the hearing.
The domestic relations commissioner's report was confirmed on March 18, 2002. Janice was granted a common law judgment against Don for $37,844.74. The judgment stated:
IT IS HEREBY JUDGMENTED that Petitioner is awarded a common law judgment against Respondent for health insurance premiums and 50% of uninsured expenses in the amount of $7,736.76 in accordance with the Parties' Property Settlement Agreement.There was nothing mentioned in the 2002 judgment regarding post-judgment interest.
IT IS FURTHER JUDGMENTED that Petitioner is awarded a common law judgment against Respondent for child support arrearages plus interest in the amount of $30,107.98 for failure to pay his child support obligation as required by the Property Settlement Agreement.
On December 14, 2016, Janice filed a motion to hold Don in contempt for failure to pay the common law judgment, claiming he stopped making payments in September 2016. She alleged that Don still owed a total amount of $74,356.21, which included unpaid post-judgment interest. On August 2, 2017, the parties entered an agreed judgment stating that beginning April 8, 2005, Don paid his child support obligation from the 2002 judgment by wage assignment through the child support office, that his last payment was withheld September 14, 2016, and that he paid a total of $31,070.80. Don subsequently tendered a check to Janice on August 14, 2017, in the amount of $6,773.94 representing the remaining balance on the 2002 judgment for medical expenses in the amount of $7,736.76.
The parties appeared for a contempt hearing where the contempt motion was remanded pending an audit from the County Attorney's office. During that hearing, Janice produced an exhibit showing a calculation that Don owed her $152,965.07, including $145,828.20 in post-judgment interest.
A hearing was held on September 28, 2017, on Janice's request for post-judgment interest. The family court concluded Don satisfied the March 2002 judgment and it would be inequitable to award post-judgment interest. Pursuant to Kentucky Rules of Civil Procedure (CR) 59.05 Janice filed a motion to alter, amend or vacate, which the family court denied. The court reiterated its discretion to award interest and concluded that the language within the 2002 judgment made it for a sum certain, inclusive of interest. This appeal followed.
The sole issue presented is whether the family court erred when it denied Janice post-judgment interest on the amounts due pursuant to the 2002 judgment until Don paid those amounts. Janice argues that the denial of interest was a modification of that judgment. We disagree.
As noted by the family court, the 2002 judgment does not contain any language awarding post-judgment interest. That judgment expressly states that Janice was awarded a common law judgement in the amount of $7,736.76 for health insurance premiums and 50% of uninsured medical expenses owed by Don and a common law judgment for child support arrearages plus interest in the amount of $30,107.98. The only mention of interest in the 2002 judgment was that it was included in the $30,107.98, a sum certain.
Janice did not claim any post-judgment interest was owed on the amounts due under the 2002 judgment until over fourteen years later, which she claims is five times the amount due under the judgment. Notably, and as Don points out, she filed her motion seeking interest on the amount due under the 2002 judgment just three months prior to when she would have been precluded from litigating the matter as time-barred pursuant to Kentucky Revised Statutes (KRS) 413.090 Under those circumstances, and because the 2002 judgment was silent as to interest, the family court ruled that it would be inequitable to impose post-judgment interest. Janice claims that regardless of whether the 2002 judgment awarded post-judgment interest, the family court was required to award post-judgment interest.
Under KRS 413.090, Janice was required to enforce the judgment within fifteen years after its entry.
Janice also challenges the family court's finding of fact that Don made timely payments for seven years when, in fact, the total amount immediately owed under the 2002 judgment was made over a period of years via wage assignment. That argument cannot amount to reversible error where the family court clarified the meaning of its statement in its judgment denying Janice's motion for CR 59.05 relief. The family court explained that it acknowledged the 2002 judgment was for child support arrearages and its "timely payment language" in the 2017 judgment was "solely a reference to the payments made via wage assignment toward the judgment." We now address what is the ultimate issue in this case, the denial of post-judgment interest.
Post-judgment interest has been addressed by the legislature in KRS 360.040. At the family court level, the parties differed as to whether the pre-2017 version of the post-judgment interest statute applied. Unlike the earlier version which provided for twelve percent statutory interest on judgments, the 2017 version provides for six percent interest on judgments except those for child support arrearages which "shall bear twelve percent (12%) interest compounded annually from the date the judgment is entered." KRS 360.040(2). We agree with the family court that the parties' disagreement is immaterial to the resolution of this case because under either version, as to child support, the interest rate is unchanged. The question is whether Don should be required to pay post-judgment interest at all on a judgment that not only went uncollected for almost fifteen years but one that Janice never attempted to enforce for almost fifteen years. We conclude that under established case law, the family court properly denied interest under equitable principles.
We do not believe our Supreme Court's decision in Doyle v. Doyle, 549 S.W.3d 450 (Ky. 2018), disturbs case law on the subject. That case involved whether post-judgment interest could be denied on a judgment awarding marital property, and the Court concluded the judgment was required to bear interest. However, as noted, that case involved a property division, not child support, and the former spouse had repeatedly attempted to garnish the obligor's bank accounts. There is no language in Doyle that expressly overrules the line of cases involving post-judgment interest on child support arrearages. --------
In Guthrie v. Guthrie, 429 S.W.2d 32, 36 (Ky. 1968), our then highest Court held that although interest should be allowed on past due child support required under a dissolution judgment, it may be denied if there are circumstances making it inequitable. It "is clearly discretionary with the court to award interest on a child support arrearage; if there are factors making it inequitable to require payment of interest it may be denied." Id. at 37. The Court concluded that the equities arising from the father's having paid for child support for other expenses relieved him of paying interest on the amount owed. The Supreme Court reaffirmed Guthrie in Young v. Young, 479 S.W.2d 20, 22 (Ky. 1972), holding that interest on child support payments owed may be denied if there are factors making it inequitable.
In Hazel Enterprises, LLC v. Ray, 510 S.W.3d 840, 843 (Ky.App. 2017), the Court held that the decision of a trial court to deny post-judgment interest is reviewed "for an abuse of its discretion, that is, whether the decision was arbitrary, unreasonable, unfair, or unsupported by sound legal principles." We conclude that the facts of this case overwhelmingly support the family court's decision.
As noted by the family court, the 2002 judgment did not mention post-judgment interest and there was ample evidence that Don believed he satisfied that judgment by paying the amount of the common law judgment. For almost fifteen years, Janice accepted the payments via wage assignment without ever attempting to collect the entire amount of the judgment or post-judgment interest and now claims an amount owed that is more than five times the original judgment. The family court's decision to deny post-judgment interest cannot be said to be an abuse of discretion.
The order of the Jefferson Family Court is affirmed.
ALL CONCUR. BRIEF FOR APPELLANT: J. Russell Lloyd
Louisville, Kentucky BRIEF FOR APPELLEE: Charles D. Brown, Jr.