Opinion
NO. 2011-CA-002259-MR
03-20-2015
JANICE H. RADER APPELLANT v. PAUL R. RADER APPELLEE
BRIEF FOR APPELLANT: Bobby L. Amburgey Mt. Vernon, Kentucky BRIEF FOR APPELLEE: Jerome S. Fish Mt. Vernon, Kentucky
NOT TO BE PUBLISHED APPEAL FROM ROCKCASTLE CIRCUIT COURT
HONORABLE WALTER F. MAGUIRE, JUDGE
ACTION NO. 11-CI-00192
OPINION
AFFIRMING
BEFORE: JONES, KRAMER, AND MAZE, JUDGES. JONES, JUDGE: This appeal arises out of a dissolution of marriage decree entered by the Rockcastle Circuit Court on October 24, 2011, and a subsequent order from the same court denying Appellant Janice H. Rader's motion to alter, vacate or amend the dissolution decree. For the reasons more fully explained below, we AFFIRM.
I. FACTUAL AND PROCEDURAL BACKGROUND
Janice H. Rader ("Wife") and Paul R. Rader ("Husband") were married on September 14, 1990, in Sevier County, Tennessee. Husband filed a petition for dissolution of marriage in Rockcastle Circuit Court on July 19, 2011. Therein, he asked the circuit court to dissolve the parties' marriage by way of a decree of dissolution and divide the parties' marital property and debts in just proportion.
Wife was served with the petition for dissolution on July 22, 2011, but failed to file a timely answer. On October 14, 2011, Husband filed a motion for default judgment and motion to submit his petition for entry of a final decree of dissolution. Along with his motions, Husband filed an affidavit averring that he and Wife had been separated for over sixty days; a notice of waiver of mandatory case disclosures regarding marital debt and property; an affidavit from his attorney in support of default regarding Wife's failure to file a timely answer after being served; and a copy of his October 11, 2011, deposition regarding the parties' marital debts and property.
On October 24, 2011, after determining that Wife was in default, the circuit court entered its Findings of Fact, Conclusions of Law and Decree of Dissolution. Therein, the circuit court found that Husband was sixty-four years old, retired, disabled, and suffering from numerous medical conditions (uncontrolled diabetes, heart disease, a disabling back injury, and a 2011 stroke). The circuit court further concluded that following the parties' divorce Husband "will lose health insurance coverage under his wife's policy, and will incur out of pocket medical and prescription drug expenses in excess of $2000.00 per month."
The circuit court found that Wife was sixty-seven years old, retired, without any significant medical problems, and resided "rent free" in a home owned by her adult son. The circuit court also found that "following separation and without the knowledge and consent of [Husband], [Wife] purchased a new 2010 sports car by trading in the parties' marital Dodge Durango."
With respect to the parties' property, the circuit court determined that the following items were marital property subject to division: "lot and mobile home on Lake Linville in Mt. Vernon, Kentucky, a 2001 Prowler camper; 2003 Ford Ranger Truck; 2010 car; wood working equipment; household furniture and appliances." The circuit court also noted that "[e]ach party receives monthly benefits from a retirement pension."
The circuit court determined that the parties owed the following marital debts: "$23,600.00 debt on Lake Linville property; $4000.00 debt on 2001 Prowler camper; $1,500.00 on 2003 Ford Ranger truck; $1000.00 [debt on] wood working equipment;" and an unknown debt on the 2010 Mitsubishi sports car Wife purchased after the parties separated.
The circuit court's decree of dissolution provides as follows:
1. The marriage of Paul R. Rader and Janice H. Rader is irretrievably broken, and therefore dissolved.
2. Petitioner Paul Rader [Husband] is awarded the mobile home and lot located on Lake Linville Road in
Mt. Vernon, Kentucky and shall be solely liable for payment of all debt approximately ($23,600.00) owed thereon. [Husband] is also awarded [the] 2003 Ford Ranger truck, his wood working equipment and all household furnishings and personal effects located at his residence on Lake Linville Road. Each spouse is assigned his or her personal effects and any other property now standing in the name or possession of said spouse and each spouse and each party shall be solely liable for any and all debts incurred in his or her own name subsequent to the filing of this actions.
3. Each party is awarded all of their respective retirement benefits free and clear of all claims of the other party. This includes both pension and social security benefits.
4. Respondent, Janice Rader [Wife], is awarded all household furnishings and personal effects located at her residence at 250 Graves Road, Mt. Vernon, Ky., with the exception of [Husband's] wood working equipment and tools, and his personal belongings located in the home and storage building. [Wife] is also awarded the 2010 Mitsubishi sports car, and shall remain solely liable for payment of all debt owed thereon. [Wife] shall also remove the 2010 Mitsubishi from [Husband's] insurance plan and obtain her own individual automobile liability insurance.
5. [Husband] agrees and is therefore ordered that the 2001 Prowler Camper be sold with the proceeds used to first pay the debt owed on the Camper with the parties to divide equally the remaining net proceeds of sale.
On November 2, 2011, acting with the assistance of counsel, Wife filed a motion to amend, alter or vacate the circuit court's decree. The circuit court heard Wife's motion on November 18, 2011. Wife argued that the circuit court should set aside the default judgment and decree because she did not obtain notice of Husband's motion for default until the day of the hearing. She intimated that Husband may have improperly attempted to keep her from timely receiving notice because the parties were still sharing a joint mailbox at that time.
Husband responded that he was not even required to serve Wife with a copy of the default motion because she had never entered an appearance in the dissolution action. Wife responded that she had been in contact with Husband's attorney before he filed the dissolution petition. She explained that she did not think that she needed to file an answer because she believed that the parties were going to allow Husband's petition to "languish" so that he could remain on her health insurance.
Wife then requested the circuit court to set a full hearing for the purpose of taking evidence on whether Wife was properly served with Husband's motion for default judgment and the value of the property the circuit court had previously divided. The circuit court refused Wife's request for a full evidentiary hearing. The circuit court orally found that the record showed that Wife was properly served with Husband's dissolution petition and acted at her own peril when she elected to proceed without counsel and without entering an appearance. The circuit court concluded that Wife had not presented any good cause for her failure to timely respond to Husband's dissolution petition and default was properly entered against her. The circuit court then entered a written order denying Wife's motion to set aside.
This appeal followed.
II. STANDARD OF REVIEW
Kentucky Rule 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."). The moving party must show: "(1) a valid excuse for default, (2) a meritorious defense to the claim, and (3) absence of prejudice to the nondefaulting party." S.R. Blanton Development, Inc. v. Investors Realty and Management Co., Inc., 819 S.W.2d 727, 729 (Ky. App. 1991).
When this Court reviews a circuit court's order denying a motion pursuant to CR 55.02 (or CR 60.02) to set aside a default judgment, the standard is abuse of discretion. Howard v. Fountain, 749 S.W.2d 690, 692 (Ky. App. 1988) ("[T]rial courts possess broad discretion in considering motions to set them aside and we will not disturb the exercise of that discretion absent abuse."). Abuse of discretion occurs when a decision is arbitrary, unreasonable, unfair, or unsupported by sound legal principles. Miller v. Eldridge, 146 S.W.3d 909, 914 (Ky. 2004).
III. ANALYSIS
The record reveals that the Rockcastle Constable served Wife with a civil summons and copy of the Husband's petition for dissolution on July 22, 2011. The summons served on Wife provides:
You are hereby notified that a legal action has been filed against you in this Court demanding relief as shown on the document delivered to you with this Summons. Unless a written defense is made by you or by an attorney on your behalf within 20 days following the day this paper is delivered to you, judgment by
default may be taken against you for the relief demanded the attached Complaint.
Pursuant to CR 12.01, Wife was required to serve an answer to the petition "within 20 days after service of the summons" on her. Thus, Wife had until August 11, 2011, to serve an answer to Husband's petition.
Husband filed a motion for default judgment on October 14, 2011, after Wife had been in default for over sixty days. The sole reason Wife posited at the hearing for setting aside the default was her assertion that she did not receive notice of Husband's motion for default.
Wife did not enter an appearance in this action until November 2, 2011, after the circuit court had entered its default judgment and dissolution decree. Because Wife had not entered an appearance at the time Husband filed his motion for default, he was not required to serve Wife with a copy of the motion. CR 55.01 states that notice of the default motion is required only where "the party against whom judgment by default is sought has appeared in the action." Because neither Wife nor any counsel acting on her behalf had appeared in the action, she was not entitled to notice of the default proceeding.
Nevertheless, Wife argues that Husband should have given her notice because she had a prior meeting with Husband and his counsel before Husband filed for dissolution. She asserts that because of this meeting Husband was aware that she wished to participate in the dissolution proceedings and should have given her notice.
Our Kentucky Supreme Court has rejected a similar argument. In Ryan v. Collins, 481 S.W.2d 85, 88 (Ky.1972), the defendant argued that he was entitled to notice of the default proceeding because he had "a conversation with the attorney for the plaintiff concerning the pending actions." The Court rejected that notice was required under such circumstances. Id. The Court held:
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.Id.
According to the defendant, the attorney for his adversaries agreed to let him know about further steps to be taken in the suits if settlement was not made by his insurer. The attorney, however, testified that he merely instructed the defendant to take the summonses which had been recently served, to the agent for the insurance company that had written public liability insurance covering the defendant. In Smith v. Gadd, Ky., 280 S.W.2d 495 (1955), we construed the word 'appeared' in CR 55.01 to mean that the defendant had voluntarily taken a step in the main action that showed or from which it might be inferred that he had the intention of making some defense. There is no evidence to support any finding that any attempt was ever made by defendant to defend the action within the allotted time or that he had any intention to make such an attempt. Under the facts as found by the trial judge, the defendant did not appear and therefore was not entitled to notice of an application for default judgment.
Having reviewed the entire record below, we are confident that the circuit court acted well within its discretion in refusing to set aside the default and dissolution decree and in refusing to conduct a full-blown evidentiary hearing on Wife's motion. Wife did not put forth or offer to put forth any evidence that would excuse her failure to file a timely answer. Furthermore, she did not present or offer to present any evidence to show that the property division was inequitable or manifestly unfair in light of the evidence before the circuit court.
IV. CONCLUSION
Finding no abuse of discretion, we affirm the Rockcastle Circuit Court.
ALL CONCUR. BRIEF FOR APPELLANT: Bobby L. Amburgey
Mt. Vernon, Kentucky
BRIEF FOR APPELLEE: Jerome S. Fish
Mt. Vernon, Kentucky