Opinion
NO. 2013-CA-001750-MR
01-16-2015
GARY M. KEYS APPELLANT v. ASSET ACCEPTANCE, LLC APPELLEE
BRIEF FOR APPELLANT: Gary M. Keys, pro se Shelbyville, Kentucky BRIEF FOR APPELLEE: W. Scott Stinnett Louisville, Kentucky
NOT TO BE PUBLISHED APPEAL FROM SHELBY CIRCUIT COURT
HONORABLE CHARLES R. HICKMAN, JUDGE
ACTION NO. 13-CI-00265
OPINION
AFFIRMING
BEFORE: CLAYTON, DIXON, AND JONES, JUDGES. JONES, JUDGE: Acting without the assistance of counsel, the Appellant, Gary M. Keys, filed this appeal seeking reversal of the Shelby Circuit Court's September 12, 2013, default judgment in favor of the Appellee, Asset Acceptance LLC ("Asset"). For the reasons more fully explained below, we AFFIRM.
I. Procedural and Factual History
On May 31, 2013, Asset filed suit against Keys in Shelby Circuit Court seeking to collect on a debt that it acquired from Fifth Third Bank. The record indicates that the Shelby County Sheriff's office served Keys on June 3, 2013. Keys did not file a timely answer with the Court. Asset moved for a default judgment on September 5, 2013. Keys attempted to contact the Court by a pro se letter on September 10, 2013, asking the court to overrule Asset's motion on the ground that "the debt is a time-barred debt as it was in default over six years ago in 2007" or, in the alternative, that any default judgment already entered by the Court be set aside.
The circuit court granted Asset default judgment on September 11, 2013, without a hearing. The circuit court's order provides as follows:
On motion by the Plaintiff, and the above-captioned Defendant having been served with process and having failed to plead or otherwise defend, it is adjudged by the Court that the Plaintiff recover of the Defendant the sum of $15,356.72, plus accrued interest of $1,462.51 through September 3, 2013, through the date of judgment, all bearing interest at the rate of 12% from the date of Judgment, plus cost expended herein, until the Judgment is satisfied. There being no just reason for delay, this Judgment is final and appealable.
Keys did not move to have the judgment set aside, but directly appealed the default judgment by filing a notice of appeal on October 10, 2013.
II. Standard of Review
Kentucky Rules of Civil Procedure ("CR") 55.02 permits a party against whom a default judgment has been entered to seek relief directly from the trial court. See CR 55.02 ("For good cause shown the court may set aside a judgment by default in accordance with Rule 60.02."). However, instead of seeking to have the judgment set aside, a party may "appeal directly from a default judgment." Jeffrey v. Jeffrey, 153 S.W.3d 849, 851 (Ky. App. 2004). Our standard of review is different depending on which avenue is pursued. Id. When a defendant against whom a default judgment has been obtained files an immediate appeal without seeking relief from the judgment from the trial court by way of a motion pursuant to CR 55.02 and CR 60.02, the appellate court's review is "limited to determining whether the pleadings were sufficient to uphold the judgment, or whether the appellant was actually in default." Mingey v. Cline Leasing Service, Inc., 707 S.W.2d 794, 796 (Ky. App. 1986).
III. Analysis
A "default judgment may not be based on a complaint which completely fails to state a cause of action [.]" Crowder v. American Mutual Liberty Ins. Co., 379 S.W.2d 236, 238 (Ky. 1964); see also Morgan v. O'Neil, 652 S.W.2d 83, 85 (Ky. 1983). Accordingly, an entry of default is only proper if the pleadings support the judgment. See Jeffrey, 153 S.W.3d at 851. In so construing the complaint and pleadings, leniency is warranted. Crowder, 379 S.W.2d at 238.
A review of the pleadings reveals them to be sufficient to uphold entry of the default judgment. Asset alleged in its complaint that it was the holder of "an account due and owing by the Defendant, and is the assignee of Fifth Third Bank." The complaint further alleged that Keys "is indebted to [it] in the amount of $15,356.72; plus interest of $1,092.26 as of May 16, 2013." On this basis, Asset sought a judgment against Keys.
The record further reveals that the Shelby County Sheriff served Keys with a civil summons and copy of the complaint on June 3, 2013. Pursuant to CR 12.01, Keys was required to serve an answer to the complaint "within 20 days after service of the summons" on him. Thus, Keys had until June 24, 2013, to serve an answer to Asset's complaint. The record does not reveal any pleadings filed by Keys on or before June 24, 2013.
The twentieth day fell on Sunday, June 23, 2013, giving Keys until the following business day to serve his answer. See CR 6.01.
Accordingly, Asset filed a motion for default judgment on September 5, 2013. Although not required to do so, Asset provided Keys with notice of its motion. See Ryan v. Collins, 481 S.W.2d 85, 88 (Ky. 1972) ("Under CR 55.01 only a defendant who has appeared in the action is entitled to prior notice of an application for a judgment by default. Although the defendant testified that he had a conversation with the attorney for the plaintiff concerning the pending actions, this did not constitute an 'appearance' as that word is used in CR 55.01.").
Based on the above-outlined facts, as reflected in the record, we must affirm entry of default judgment against Keys. Asset's complaint stated a cause of action against Keys and Keys was in default. We pause only briefly to note that Keys's pro se letter came too late save him from default. While Keys asserted a defense in the letter and asked the court the dismiss Asset's complaint against him, he did not send the letter until after his time to answer had expired. Thus, the present case is distinguishable from Kearns v. Ayer, 746 S.W.2d 94 (Ky.App.1988), where we held that default judgment could not be entered against a defendant after he timely submitted documents asserting that he was not responsible for the debt via a pro se letter to the court. The letter in Kearns was sent to the court prior to the time the defendant had to file an answer and prior to the plaintiff seeking a default judgment.
Because Keys did not move the trial court to set aside entry of default against him, we are without authority to review his statute of limitations arguments. The trial court has never been provided with a proper opportunity to consider these issues. As such, we cannot properly review them. On direct appeal of the default judgment our review is limited to determining whether the complaint stated a claim and whether the defendant was actually in default. Having answered both inquiries in the affirmative, we cannot proceed any further with our review. See Monties Resources, LLC v. Emeco Equipment USA, LLC, Nos. 2010-CA-000598-MR, 2010-CA-001285-MR, 2010-CA-001286-MR, 2012 WL 95427 at *2, fn.3 (Ky. App. Jan 13. 2012) (explaining that we follow Jeffery, supra, instead of the substantial error standard of review with respect to unpreserved issues when reviewing a default judgment directly appealed to our Court).
III. Conclusion
For the reasons set forth above, we affirm the order of the Shelby Circuit Court.
ALL CONCUR. BRIEF FOR APPELLANT: Gary M. Keys, pro se
Shelbyville, Kentucky
BRIEF FOR APPELLEE: W. Scott Stinnett
Louisville, Kentucky