Robert E. James v. Kimberly B. James (Now Woods) ( 2021 )

RENDERED: OCTOBER 22, 2021; 10:00 A.M.
TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2020-CA-1357-MR
ROBERT E. JAMES APPELLANT
APPEAL FROM BOYD CIRCUIT COURT
v. HONORABLE GEORGE W. DAVIS, III, JUDGE
ACTION NO. 13-CI-01100
KIMBERLY B. JAMES (NOW WOODS);
AND KENTUCKY FARMERS BANK APPELLEES
OPINION
AFFIRMING IN PART,
REVERSING IN PART,
AND REMANDING
** ** ** ** **
BEFORE: ACREE, COMBS, AND MAZE, JUDGES.
MAZE, JUDGE: Robert E. James (Robert) appeals from post-decree orders of the
Boyd Circuit Court in matters relating to the dissolution of his marriage to
Kimberly B. James, now Kimberly Woods (Kimberly). The trial court entered
these orders as part of a sale of the parties’ real property following remand from a
prior opinion of this Court. Robert first argues that the trial judge improperly
denied his motion to recuse. However, he fails to direct this Court to any properly
supported motion or the order denying the motion. Therefore, that issue is not
properly presented on appeal.
Robert next argues that the trial court erred by holding that the sale
proceeds were subject to a mortgage issued to Kimberly following entry of the
decree. We conclude that the trial court acted within its jurisdiction when it
allowed the mortgage holder to intervene to assert a claim to the sale proceeds.
Furthermore, the trial court did not err in finding that the mortgage holder was
entitled to priority in the sale proceeds. However, we further conclude that the trial
court erred by failing to charge Kimberly for the deduction of a non-marital debt
out of the sale proceeds. Lastly, we conclude that the trial court did not clearly err
in its calculation of the other credits to which Kimberly was entitled. Hence, we
affirm in part, reverse in part, and remand for a recalculation and reallocation of
the sale proceeds due to Robert and Kimberly respectively.
The relevant facts of this appeal are as follows. Robert and Kimberly
were married in 1987 and separated in 2013. Kimberly filed a petition for
dissolution of the marriage on December 23, 2013. The disputed issues concerned
custody and support of their then-minor child, and division of marital property and
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debt. The trial court assigned the issues to a Domestic Relations Commissioner
(DRC) for a hearing.
Following the hearing, the DRC issued a Report and
Recommendation. In pertinent part, the DRC recommended that the marital
residence be sold with the marital debts paid off from the proceeds and the
remaining proceeds divided equally between the parties. The parties each filed
objections to the report. On September 3, 2014, the trial court overruled most of
the objections.
Thereafter, on September 17, 2014, the trial court entered a decree
dissolving the marriage and setting out the disposition of marital property and
debts. The decree incorporated the DRC’s recommendation regarding the marital
residence, setting out as follows:
It is hereby ordered that the parties[’] marital residence
shall be sold and after a reduction for the costs associated
with the sale of the house the net proceeds shall first be
applied to the payment of the parties[’] credit card debt
and/or other marital indebtedness and the remainder if
any shall be divided equally between [Kimberly] and
[Robert].
Neither party sought to modify the decree or filed a notice of appeal.
The parties continued to have other disputes regarding custody and visitation
which are not relevant to this appeal. In addition, the parties could not reach an
agreement regarding the listing and sale of the marital residence. On October 21,
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2014, Robert filed a motion, which, among other things, asked the trial court to set
conditions for the listing and sale of the marital residence from the judgment.
The trial court entered an order on November 12, 2014, directing
Kimberly to cooperate in the preparation and the signing of a listing agreement to
facilitate the offering of the marital residence for sale. On January 20, 2015, the
trial court entered an amended order directing the parties as follows:
the parties shall agree on an appraiser to value the marital
residence at [Kimberly’s] expense. The appraisal shall
take place within ten (10) days. [Kimberly] shall then
within twenty (20) days tender to [Robert] an amount
equal to half of said value. If the parties are unable to
agree upon an appraiser, the Court shall appoint one.
The parties eventually agreed on an appraisal of the property by
Prichard Realty. Prichard Realty’s report appraised the property at $39,580.
Robert disputed that appraisal and the trial court resubmitted the matter to the
DRC. The DRC directed the parties to submit additional appraisals, which varied
from between $18,000 to $55,000.
After additional proceedings, Kimberly filed a motion asking the trial
court to value the property at $28,000. She further requested that the trial court
allow her to purchase Robert’s share for $14,000, to allow her to present proof of
her payments on the marital debt, and to deduct one-half that amount from the
gross purchase price for Robert’s share of the residence. In response, Robert
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argued that the trial court lacked jurisdiction to amend the decree. However, he
also requested that he be allowed to purchase the property.
On November 20, 2015, the court entered an order permitting
Kimberly to purchase the residence for $28,000. The court directed Kimberly to
pay $14,000 into escrow as consideration for Robert’s share. After additional
proceedings, the trial court entered an order on June 13, 2016, directing Robert to
sign a quitclaim deed to convey his interest in the property to Kimberly. The order
specifically noted that the quitclaim deed was necessary for Kimberly to obtain a
loan to finance her purchase of the property.
Robert then appealed from this order. This Court vacated the trial
court’s order, concluding that it lacked jurisdiction to modify the decree in the
absence of a proper motion pursuant to CR1 60.02. James v. James, No. 2016-CA-
000993-MR, 2017 WL 6188409, at *2 (Ky. App. Dec. 8, 2017). This Court
remanded the matter to the trial court “with instructions to enforce the decree as
entered.” Id. at *1.
While that appeal was pending, Kimberly recorded the quitclaim deed
from Robert. Kimberly also obtained a mortgage from Kentucky Farmers Bank
1
Kentucky Rules of Civil Procedure.
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(KFB). She used some of the proceeds to pay off the marital credit cards and
deposited the rest into escrow.
Following the remand from this Court, Robert filed a motion
requesting the sale of the property by the Master Commissioner. Kimberly filed a
motion requesting a credit of $16,942.12 for the monies paid toward the marital
debt, and of $9,108.35 representing the remaining proceeds from the KFB
mortgage.
To protect its interest, KFB filed a motion for leave to intervene,
which was granted on October 1, 2019. KFB’s intervening complaint requested a
declaratory judgment that it had a valid mortgage lien and that the lien be
determined to have priority over all other liens or debts. Shortly after the filing of
the intervening complaint, KFB moved for summary judgment. The trial court
granted KFB’s motion on October 21, 2019. The court concluded that KFB
properly relied upon the quitclaim deed executed by Robert. Consequently, the
court found that KFB’s mortgage is a lien on the property free and clear of any
interest by Robert. Finally, the court directed that any order of sale be subject to
KFB’s mortgage. The trial court designated this order as final and appealable
pursuant to CR 54.02.
Robert filed a CR 59.05 motion objecting to the inclusion of the
finality language. However, he conceded that KFB’s interest was valid and should
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have priority in the sale proceeds. The trial court denied the motion on November
13, 2019. In a separate order entered the same day, the trial court ordered the
property sold by the Master Commissioner. The order further directed the Master
Commissioner to hold the proceeds of the sale pending further order of the court.
The property was sold at Master Commissioner’s Sale on January 3,
2020 for a purchase price of $39,000.2 Robert did not file any objections to the
sale, but he objected to payment of KFB’s attorney fees from his portion of the sale
proceeds. Robert also took the position that the mortgage debt and the associated
attorney fees claimed by KFB were solely Kimberly’s non-marital debt.
On July 10, 2020, the trial court entered an order directing the Master
Commissioner to pay out the proceeds from the sale as follows:
Kentucky Farmers Bank $20,244.77
Master Commissioner Sale Fee $1,170.00
Master Commissioner Report Fee $50.00
Master Commissioner Deed Fee $50.00
Master Commissioner Expenses $56.30
C. Stone – Appraisal Fee $150.00
B. Prichard Appraisal – Appraisal Fee $150.00
Ashland Daily Independent $642.60
Kimberly Woods $8,243.16
Robert E. James $4,125.67
KFB Attorney Fee $4,117.50
2
The Commissioner reported that Robert Mitchell Woods was the purchaser of the property at
the sale. Robert notes that Woods is Kimberly’s brother, but he does not object to the sale.
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Robert filed a motion to reconsider this order of distribution. He
noted that the prior Court of Appeals decision directed that only the debts of the
parties set out in the decree could be deducted from the sale proceeds. Contrary to
his prior concession, Robert also argued that the property should be sold subject to
KFB’s mortgage indebtedness. For the same reasons, Robert objected to payment
of KFB’s attorney fees from the proceeds of the sale. Finally, Robert argued that
the court improperly credited Kimberly for payment of a credit card debt which
was still outstanding.
Following a hearing, the trial court denied Robert’s motion to
reconsider. In pertinent part, the court stated, “the issues [Robert] raised were
addressed upon appeal and upon subsequent [o]rder of the [c]ourt following the
Appellate Court’s direction which was not appealed and is now the law of the
case.” Robert now appeals.
As an initial matter, Robert argues that the trial judge should have
recused himself due to alleged bias and ex parte communication. We find no basis
for questioning the impartiality of the trial judge. The asserted belief that a judge
will not afford a fair and impartial trial must be based upon substantial facts as set
forth in a supporting affidavit. See Abbott, Inc. v. Guirguis, 626 S.W.3d 475, 481
(Ky. 2021), reh’g denied (Jun. 17, 2021).
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We find no indication that Robert filed an affidavit supporting his
motion to recuse. Id. at 481-82 (citing KRS3 26A.020(1)). In any event, Robert
fails to identify either where in the record he filed the motion or the order denying
his motion to recuse. In the absence of a properly supported motion or
preservation of the issue, we decline to address the issue further.
Kimberly also argues that Robert’s brief fails substantially to comply
with the appellate rules. His statement of the case includes a rough chronological
summary of the facts and procedural events in the trial court with citations to the
trial court record. CR 76.12(4)(c)(iv). However, his brief fails to include any
citations to legal authority pertinent to the issues presented on appeal or any
references to the record showing that these issues were preserved for review. CR
76.12(4)(c)(v). It is not the task of an appellate court to construct arguments for
parties, Smith v. Smith, 235 S.W.3d 1, 5 (Ky. App. 2006), or to determine how an
issue is preserved for review. Phelps v. Louisville Water Co., 103 S.W.3d 46, 53
(Ky. 2003). This Court has held that “[a]ssertions of error devoid of any
controlling authority do not merit relief[,]” and so we may summarily affirm a trial
court if an appellant’s brief fails to comply with CR 76.12. Koester v. Koester, 569
3
Kentucky Revised Statutes.
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S.W.3d 412, 414 (Ky. App. 2019). See also Clark v. Workman, 604 S.W.3d 616(Ky. App. 2020).
Despite Robert’s failure to comply with the appellate rules, we are
still constrained to address several of the issues to the extent they are affected by
the law of the case. Where an appellate court has passed on a legal question and
remanded the case to the court below for further proceedings, the legal
determinations may not be revisited on a subsequent appeal in the same case.
Inman v. Inman, 648 S.W.2d 847, 849 (Ky. 1982). The trial court must strictly
follow the mandate set out in the prior appellate decision. Id. In a subsequent
appeal following remand, this Court’s role is limited to whether the trial court
properly construed and applied the mandate. Id.In the prior appeal, this Court held that the trial court lacked
jurisdiction to modify the provisions of the decree except under the provisions of
CR 60.02. Since no such motion had been filed, this Court vacated the trial court’s
June 13, 2016, order with specific directions to sell the marital property and to
divide the proceeds of the sale as set forth in the September 17, 2014, decree. The
existence of KFB’s mortgage on the property was a complicating factor in the trial
court’s task on remand.
Robert argues that KFB should be responsible for the mortgage and
charges associated with the litigation. However, he does not argue that the trial
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court abused its discretion by granting KFB’s motion to intervene. See CR 24.01.
See also Hazel Enterprises, LLC v. Cmty. Fin. Servs. Bank, 382 S.W.3d 65, 68
(Ky. App. 2012). We conclude that KFB’s intervening complaint invoked the trial
court’s jurisdiction for the matters relating to the Master Commissioner’s Sale.
Consequently, the trial court acted within its jurisdiction when it addressed KFB’s
claims relating to the mortgage on the marital property.
The trial court also concluded that KFB’s mortgage and litigation
costs would have priority from the sale proceeds. Robert did not file a notice of
appeal from these orders, which the trial court designated as final and appealable
prior to the sale. Furthermore, Robert presents no legal or factual basis which
would allow this Court to find these determinations to be clearly erroneous.
Indeed, we agree with the trial court that KFB was entitled to rely on the recorded
quitclaim deed, particularly because it had no notice of the pending appeal.
Therefore, we must affirm the trial court’s orders with respect to KFB’s claims to
the sale proceeds.
Robert next argues that the trial court failed to properly allocate the
sale proceeds between him and Kimberly. In this matter, we agree. KFB’s
mortgage on the marital property is clearly a non-marital debt, since Kimberly
encumbered the property following the entry of the decree. In so doing, Kimberly
acted in reasonable reliance upon the trial court’s November 20, 2015 and June 13,
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2016 orders. On the other hand, Robert had no part in incurring that new debt, and
he promptly appealed the trial court’s order permitting Kimberly to purchase and
encumber the property.
As noted above, KFB’s intervening complaint properly invoked the
trial court’s jurisdiction to consider its claims arising from the mortgage.
However, neither Robert nor Kimberly filed CR 60.02 motions to address the
collateral effects of those claims on the prior adjudications in the decree. Thus, the
trial court was obligated to strictly comply with the mandate of this Court’s
opinion to the extent possible. Buckley v. Wilson, 177 S.W.3d 778, 781 (Ky.
2005). In light of this Court’s prior opinion, any claims between Robert and
Kimberly arising after the entry of the decree were outside the scope of remand.
Therefore, we conclude that the trial court erred in its allocation of the
sale proceeds after satisfaction of KFB’s claims. Of course, the costs associated
with the Commissioner’s Sale would have been incurred had the property been
sold as directed in the decree. And the decree directed that any marital debts were
to be paid from the sale proceeds. As a result, the trial court properly credited
Kimberly for payment of those marital debts from the mortgage proceeds.
However, the trial court must treat KFB’s mortgage and the associated
litigation costs as Kimberly’s non-marital debt in any allocation of those proceeds.
Those amounts must be deducted from Kimberly’s share of the remaining sale
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proceeds. Any other result would allow Kimberly to modify the decree in
contravention of this Court’s mandate.
On the other hand, we must emphasize that the only issue before the
trial court on this remand concerns the allocation of the proceeds from the
Commissioner’s Sale. As we have noted, neither party has sought to re-open the
decree to address the collateral effects of the mortgage. Consequently, any
potential deficiency in the allocation of the proceeds is beyond the scope of the
order of remand.
Finally, Robert takes issue with the trial court’s calculation of the
credit due to Kimberly for her payment of the marital debts from the mortgage
proceeds. He contends that there was no evidence that Kimberly actually paid a
CitiBank/Steelworker’s credit card debt with a balance of approximately $6,900.
However, he presents no evidence that the trial court’s calculation of the credit due
to Kimberly was clearly erroneous. Therefore, we decline to address the matter
further.
Accordingly, the order of the Boyd Circuit Court is affirmed in part,
reversed in part, and remanded with directions to allocate the sale proceeds
between Robert and Kimberly as set forth in this Opinion.
ALL CONCUR.
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BRIEFS FOR APPELLANT: BRIEF FOR APPELLEE KIMBERLY
B. WOODS:
Charles L. Douglas, Jr.
Greenup, Kentucky Tracy D. Frye
Russell, Kentucky
BRIEF FOR APPELLEE
KENTUCKY FARMERS BANK:
Philip Q. Ratliff
Ashland, Kentucky
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