Danny Allen Smith v. Debra Lynn Smith (Now Price) ( 2022 )

RENDERED: JULY 22, 2022; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2021-CA-1219-MR
DANNY ALLEN SMITH APPELLANT
APPEAL FROM WARREN CIRCUIT COURT
v. HONORABLE CATHERINE R. HOLDERFIELD, JUDGE
ACTION NO. 90-CI-00995
DEBRA LYNN SMITH (NOW PRICE) APPELLEE
OPINION
AFFIRMING
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BEFORE: ACREE, COMBS, AND MAZE, JUDGES.
COMBS, JUDGE: Danny Allen Smith appeals the judgment of the Warren Family
Court entered May 24, 2021, awarding to Debra Lynn Smith (now Price) child
support arrearages that accumulated between September 2, 2005, and May 27,
2006, bearing interest at 12%. After our review, we affirm.
The parties were divorced on June 15, 1992, and Danny was ordered
to pay $72.34 per week for the support of the parties’ only child, a son. The
support order was never modified. The child reached the age of majority in March
2006 and graduated high school in May 2006.
On September 2, 2020, Debra filed a motion to determine an alleged
child support arrearage. Relying on the statute of limitations, the family court
ordered that Debra would be permitted to collect only those arrearages, if any, that
had accumulated between September 2, 2005, through May 27, 2006. Following
an evidentiary hearing, the family court found that Danny’s payment of child
support was inconsistent and that no credible evidence proved that he had paid
child support between September 2, 2005, and May 27, 2006. The court found an
arrearage totaling $2,748.92. Pursuant to the provisions of KRS1 360.040(2), the
court determined that the unpaid child support bore interest at 12%, compounded
annually. It found no reason why the imposition of interest would be inequitable
under the circumstances and awarded an additional $12,297.48 for the benefit of
the child. Danny filed a motion to alter, amend, or vacate the court’s order, which
was denied. This appeal followed.
On appeal, Danny contends that the family court clearly erred by
finding that he had failed to satisfy his burden to prove by a preponderance of the
evidence that he had paid the entirety of his child support obligation. We disagree.
1
Kentucky Revised Statutes.
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Danny does not deny that “each installment of child support becomes
a lump sum judgment, unchangeable by the trial court when it becomes due and is
unpaid.” Raymer v. Raymer, 752 S.W.2d 313, 314 (Ky. App. 1988) (quoting
Stewart v. Raikes, 627 S.W.2d 586, 589 (Ky. 1982)). In Raymer, we observed that
payment is an affirmative defense pursuant to CR2 8.03 and pointed out that “[t]he
party holding the affirmative of an issue must produce the evidence to prove it.”
Raymer, 752 S.W.2d at 314 (quoting CR 43.01); see also Sallee v. Sallee, 468
S.W.3d 356 (Ky. App. 2015). In Gibson v. Gibson, 211 S.W.3d 601 (Ky. App.
2006), we held that where the validity of an order setting child support is
established, the obligor-parent bears the burden of proving that he satisfied the
obligation and that he owes no arrearage.
Danny had the burden of proof at the evidentiary hearing to establish
that he had satisfied his child support obligation under the terms set out in the
decree of dissolution. He produced cancelled checks and other evidence to show
that he paid his child support obligation through August 2004 and testified that he
certainly satisfied the remainder of his obligation -- specifically recalling having
written the last child support check when his son was graduating from high school
in May 2006.
2
Kentucky Rules of Civil Procedure.
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The family court observed the witnesses and heard their testimony. It
is axiomatic that a trial court is in a better position than an appellate court to
evaluate the evidence. McCain v. McCarty, 611 S.W.3d 745 (Ky. App. 2020).
From the evidence in the case before us, the family court found that “proof of
payments produced by [Danny] were sporadic . . . and did not demonstrate [he]
paid his obligation routinely[;] therefore, it cannot be inferred that [Danny] paid his
entire child support obligation. . . . [He] produced no evidence of specific
payments he made during 2005 and 2006.” The court was not persuaded that
Danny offered evidence sufficient to meet his burden of proof. In light of the
evidence, that decision is not clearly erroneous. Consequently, it must be affirmed.
Next, Danny contends that the family court erred by imposing 12%
interest (compounded annually) on the unpaid child support installments. He
acknowledges that the provisions of KRS 360.040(2) authorize the family court to
impose 12% interest on his unpaid child support obligation. However, he contends
that the family court “ignored well-established Kentucky case law that allows for
equitable situations in which no interest should be imputed, or in the alternative, at
an amount for which less than 12% interest should be considered.” Again, we
disagree.
In Guthrie v. Guthrie, 429 S.W.2d 32, 36 (Ky. 1968), our then highest
court held that although interest should be imposed on past due child support, it
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may be denied where 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.”
Gibson, 311 S.W.3d at 611. The Guthrie Court concluded that where the father
paid for the children’s expenses rather than his child support obligation, the
equities could weigh in favor of relieving him of paying interest on the amount
owed. Guthrie, 429 S.W.2d at 37. The Supreme Court of Kentucky reaffirmed
Guthrie in Young v. Young, 479 S.W.2d 20 (Ky. 1972), holding that interest on
child support payments owed may be denied if there are factors making it
inequitable. In Gibson, we held that imposition of interest on an unpaid child
support obligation is appropriate unless there are factors presented to the family
court to make the imposition of interest inequitable.
In support of his contention that interest on his unpaid child support
obligation should not be imposed, the only factor that Danny presented to the
family court was his dissatisfaction with Debra’s delay in seeking to enforce the
child support order. However, in Doyle v. Doyle, 549 S.W.3d 450 (Ky. 2018), the
Supreme Court of Kentucky observed that where a former spouse failed to comply
with a court order, criticism of the efforts of his former partner to collect should
have no bearing on the imposition of interest that accrued by operation of law. The
court observed that the provisions of KRS 360.040 are not designed to be punitive
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but are meant to encourage a judgment debtor to comply promptly with the terms
of the judgment and to compensate the judgment creditor for the judgment debtor’s
use of her money. Id.In this case, the family court noted that it was “unaware of any
hardship being caused to [Danny] by the imposition of this interest.” It concluded
that “the lapse of time between when the payments became due and when [Debra]
filed her motion is not enough alone to create an inequity.” There is nothing in the
record to indicate that Danny ever lacked the financial resources to satisfy his child
support obligation; that he lacked an understanding of the extent of that obligation;
or that he provided any other services to the child. On the other hand, Debra was
unfairly deprived of the use of the ordered support for more than fifteen years. The
family court’s conclusion that the balance of equities did not weigh in Danny’s
favor was not unreasonable. Consequently, it did not abuse its discretion by
imposing interest at the statutory rate. We do not address Danny’s reference to the
doctrine of laches because equitable relief is not available where a remedy is
provided by law; i.e., here, an applicable statutory limitations period governs the
action.
We affirm the judgment of the Warren Family Court.
ALL CONCUR.
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BRIEFS FOR APPELLANT: BRIEF FOR APPELLEE:
Kenneth A. Meredith II Kate E. Payton
Bowling Green, Kentucky Bowling Green, Kentucky
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