Worthington v. Thomas , 134 Idaho 433 ( 2000 )

KIDWELL, Justice.

Diane Worthington appeals from the magistrate and district courts’ determination that interest on delinquent child-support payments should not be awarded when arrearages are consolidated into a final judgment. We affirm.

I.

FACTS AND PROCEDURAL BACKGROUND

On August 12, 1972, appellant Diane Worthington and respondent Larry Thomas were married. Three children were born of the marriage, which ended by divorce on August 4,1982. The 1982 divorce decree incorporated the parties’ settlement agreement for the disbursement of property and custody and support of the children. The settlement agreement gave Worthington custody of the children and provided that Thomas pay child support until the children reached the age of majority.

Due to changes in the actual physical custody of the children and disputes arising from prior agreements of the parties, Thomas filed a motion to modify and consolidate any past owing child support.¹ A trial was held on December 20 and 22, 1989. The magistrate court entered findings of fact and conclusions of law on March 6,1990.

The magistrate court found that as of December 20, 1989, Thomas owed Worthington $10,611.67, “as a principal balance of accrued but unpaid child support.” In this action to consolidate past owing support into one judgment, the magistrate found that interest should be applied at the statutory rate on “all sums applicable to this case.”

The court ordered Thomas’s counsel to prepare “an appropriate judgment based upon the above Findings of Fact and Conclusions of Law.” Thomas’s counsel complied, and on May 15, 1990 the magistrate entered a judgment which stated that amounts owed to Worthington from Thomas for past child support would accrue “interest thereon from the date thereof at the judgment rate as provided by law.”

On May 29, 1990, Worthington moved the magistrate to amend the judgment to include pre-judgment interest on her award, thus allowing her to collect interest on each of the monthly amounts due prior to the December 1989 hearing. The motion was not heard by the magistrate court for nearly seven years.²

On March 27, 1997, the magistrate held a hearing on Worthington’s motion to amend the judgment. While the majority of the hearing was continued until June, the magistrate rendered an order from the hearing, that “child support payments draw interest from the date they each individually come due.”

On June 26, 1997, the magistrate court again took up the motion to amend the May 16,1990 judgment. During that hearing, the magistrate pointed out that Worthington was not entitled to interest on accrued child support prior to December 1989 because she had failed to prove the amount she was entitled to at the 1989 hearing. In a subsequent written order, the magistrate confirmed that Worthington was only entitled to interest on accrued child support from the 1990 judgment forward and not for any time prior to that.

In an order resulting from a hearing on June 26, 1997, the magistrate denied Worthington’s motion for a writ of execution. Worthington had sought the writ to collect the interest on payments due prior to the December 1989 hearing.³

Worthington appealed the magistrate’s decision that she was not entitled to a writ of execution nor to any interest prior to December 1989. The appeal was heard by the district court, which issued its written decision on May 19,1998. The district court held that because Worthington had failed to present evidence of the amount of interest owed to her prior to the 1989 hearing, she was barred from collecting under the doctrine of res judicata. Thus, Worthington could execute on the 1990 judgment for post-judgment interest (from 1990 forward) but not for prejudgment interest (anything before the 1990 judgment).

Worthington appeals from both the magistrate and district courts’ decisions.

II.

STANDARD OF REVIEW

When this Court reviews a case appealed from a district court’s appellate review of a magistrate’s decision, this Court will review the decision of the magistrate court, independently of, but with due regard for, the decision of the district court. In Re Estate of Kirk, 127 Idaho 817, 822-23, 907 P.2d 794, 799-800 (1995). Where the magistrate court’s findings of fact are supported by substantial and competent evidence, even if the evidence is conflicting, the magistrate’s decision will not be disturbed on appeal. Stonecipher v. Stonecipher, 131 Idaho 731, 734, 963 P.2d 1168, 1171 (1998). However, this Court freely reviews issues of law. Id.

III.

ANALYSIS

A. A Writ of Execution Can be Used for Collecting Accrued Interest On Past-Due Child Support Payments.

Worthington claims that the district court erred when it denied her writ of execution for the interest which was due her prior to the December 1989 judgment. In support of her claim, Worthington cites the Court of Appeals case of Hunsaker v. Hunsaker, 117 Idaho 192, 194, 786 P.2d 583, 585 (Ct.App.1990).

In Hunsaker, the delinquent payor argued to the Court of Appeals that in order to accrue statutory interest each past due child support payment must first be reduced to a judgment. Hunsaker, 117 Idaho at 194, 786 P.2d at 585. After considering cases from this Court and Idaho Code statutes, the Court of Appeals determined that “interest accrues at the judgment rate from the due date on delinquent child support installments.” Id. The Court of Appeals then explained the proper procedure for a payee to collect judgment interest on past due child support payments.

The court noted that, “Although each support installment acquires the status of judgment when it comes due, it would be unwise to place a burden on court clerks to compute daily interest on every child support payment.” Id. The court continued that, “The better approach, in our view is for court clerks simply to maintain records of support payments due and payments received.” Id. The correct procedure for collecting interest on support payments, reasoned the court, is for the payee to “seek and obtain from the court a writ of execution based upon an affidavit which sets forth a calculation of interest include[ing] the amount due under the judgment.” Id. at 194-95, 786 P.2d at 585-86 (internal citations omitted).

In the present case, there is no dispute as to the holding of Hunsaker. Both of the parties, the magistrate comb, and the district court agree that once child support payments become due and owing, interest at the statutory rate begins to accrue. Therefore, it was not necessary to reduce the past owing child support payments to a judgment in order for judgment interest to begin accruing. However, in the present case we are faced with a situation where the past due child support payments were consolidated into a single judgment.

Worthington claims that, even though the payments were consolidated into a single judgment, she should still be able to collect interest on the delinquent payments through a writ of execution.

In Dams v. Davis, 114 Idaho 170, 755 P.2d 3 (Ct.App.1988), the Court of Appeals considered a similar issue. In Davis, after the magistrate court determined that the payor was delinquent, the parties entered into “a stipulation providing the manner in which future support payments would be made and the delinquency would be discharged.” Davis, 114 Idaho at 171, 755 P.2d at 4. Two years after the stipulation had been incorporated into a judgment, the payee sought to modify the judgment to include judgment interest on the delinquent payments which had been incorporated into the judgment. Id. When the magistrate court declined to modify the judgment, the payee appealed to the district court. Id. at 172, 755 P.2d at 5. When the district court dismissed the appeal on procedural grounds, the payee appealed.

The case was heard by the Court of Appeals which held that “all such obligations, and any interest that might have accrued thereon, were merged into the magistrate’s order adjudicating the amount of the delinquency in June 1984, and prescribing the manner in which it would be paid.” Id. In both the present ease and Davis, the parties had the opportunity to raise the issue of interest prior to the entering of the magistrate’s order. In both eases, the parties attended, and were represented by counsel, at evidentiary hearings on the amount of the arrearages. The parties all had the full and fair opportunity to raise the issue of interest prior to the entering of the magistrate’s order.

Therefore, we hold that, like Davis, when the magistrate court consolidated the past due support obligations into a single judgment, any claim to interest Worthington had was merged into the consolidated judgment. While Worthington properly sought to modify the judgment of the magistrate court to include interest, for the reasons stated below we hold that she is now barred from collecting.

B. The Rule of Res Judicata Can be Applied to Bar the Procedural Matter of Post-Judgment Interest.

Worthington argues that interest on delinquent child support payments is post-judgment interest because the Court of Appeals held that once a support installment becomes due it becomes a judgment. Hunsaker, 117 Idaho at 194, 786 P.2d at 585. She further asserts that since post-judgment interest is a procedural matter, the doctrine of res judicata cannot be applied.

In this argument, Worthington attempts to convince this Court that the doctrine of res judicata is being applied to the post-judgment interest itself, thus depriving her of post-judgment interest she is entitled to. However, actually, Worthington’s claim to interest on the delinquent child support has never been adjudicated because she failed to raise it to the magistrate court.

Worthington cites the case of State, Bureau of Child Support v. Knowles, 128 Idaho 835, 837-38, 919 P.2d 1036, 1038-39 (Ct.App.1996), for the proposition that res judicata “prevent[s] litigation of causes of action.” While this quote does come from Knowles, a closer look at the context of the quote is necessary.

Knowles was trying to use res judicata as a defense to a paternity action, claiming that the issue of paternity was fully litigated in the divorce action fourteen years earlier. Id. The magistrate denied Knowles’s motion to dismiss because it found the doctrine of res judicata did not apply. Id. The Court of Appeals affirmed the magistrate on the basis that the parties to the divorce decree were not the same parties to the present action. Id. In explaining the rationale behind the doctrine of res judicata, the Court of Appeals stated that “res judicata prevents litigants who were parties in a prior action and those in privity with them from bringing or having to defend a claim arising from the transaction or series of transactions giving rise to the first suit.” Id. (emphasis in original).

In the present ease, Worthington had the opportunity, and in fact under Hunsaker was required, to raise the issue of interest to the magistrate court. Worthington failed to raise the issue and thus it was not decided by the magistrate court. Therefore, res judicata is not being applied to a previously established legal right to interest, but to an issue that should have been brought at the magistrate’s hearing on the delinquent payments.

C. Because Worthington Failed to Pursue Her Motion To Modify, Res Judicata Bars Her Collection of Interest on Past-Due Child Support Payments.

Worthington claims that res judicata cannot be applied because the judgment of the magistrate is not final. The judgment cannot be final, she reasons, because her motion to amend tolls the time for appeal until the motion is ruled upon. This Court has held that I.R.C.P. 59(e) “does destroy the finality of a judgment for purposes of appeal, and the full time for appeal commences to run anew from the entry of an order disposing of the motion and restoring finality.” First Sec. Bank v. Neibaur, 98 Idaho 598, 603, 570 P.2d 276, 281 (1977); State v. Goodrich, 104 Idaho 469, 471, 660 P.2d 934, 936 (1983).

However, in the present case we determine that the magistrate’s judgment was final because Worthington’s seven year delay in prosecuting her motion to modify the judgment was an unreasonable delay. Worthington filed her motion to amend judgment, presumably under I.R.C.P. 59(e), on May 29, 1990, thirteen days after the magistrate entered judgment. As previously noted, the district court found that Worthington had noticed up her motion for June 7, 1990, and again on May 18, 1997. Nothing in the record supports those findings. There is also nothing in the record to explain why the motion was not heard for seven years. During that time, Worthington changed counsel three times, and she and Thomas were in court several times wrangling over other issues. It thus appears that the issue of amending the judgment to include interest was not a priority and somewhere over the years was abandoned.

While Worthington is correct in her assertion that her motion to amend tolls the finality of the judgment, fairness and equity do not allow her to completely destroy the finality of the judgment by failing to pursue her motion. In considering other nales of civil procedure, this Court has held that “unreasonable delay creates a presumption of prejudice to the defendant’s case.” Ellis v. Twin Falls Canal Co., 109 Idaho 910, 912, 712 P.2d 611, 613 (1985). Similarly, when a plaintiff sought a motion for continuance after three years of not prosecuting the claim, this Court ruled that “it is consonant with sound reason that a plaintiff who hails a defendant into court assumes, and, so long as he has the affirmative of the main issue, retains the duty of diligent prosecution.” Hansen v. Firebaugh, 87 Idaho 202, 209, 392 P.2d 202, 206 (1964).

While this Court is not going to set a specific time at which an unreasonable delay in prosecuting a motion to modify will fad to destroy the finality of a judgment, we hold that in the present ease Worthington’s seven year delay is too long.

D. The Magistrate Court Did Not Err in Allowing Post-Judgment Interest to Accrue on a Consolidated Judgment that Included Pre-Judgment Interest.

Worthington is essentially arguing that Davis must be overruled because a party may not be awarded both pre-judgment and post-judgment interest on the same claim. This conclusion however, misstates Idaho law.

I.C. § 28-22-104(2) provides that post-judgment interest is available at the “legal rate of interest on money due on the judgment of any competent court or tribunal.” Id. This Court has held that “interest is automatically allowed on judgments and is allowed at the statutory rate.” Chenoweth v. Sanger, 123 Idaho 189, 191, 846 P.2d 191, 193 (1993). Since post-judgment interest is automatically allowed on all judgments, Worthington’s argument would preclude prejudgment interest altogether. This Court routinely allows pre-judgment interest “where the amount of liability is liquidated or capable of ascertainment by a mere mathematical calculation.” Doolittle v. Meridian Joint Sch. Dish No. 2, 128 Idaho 805, 814, 919 P.2d 334, 343 (1996). This Court will continue to follow its longstanding tradition of allowing, in appropriate circumstances, both pre-judgment and post-judgment interest.

IV.

CONCLUSION

Worthington was required to establish the amount of judgment interest she was entitled to at the magistrate’s hearing to consolidate the delinquent obligations. Because Worthington abandoned her motion to modify the magistrate court’s order, we hold that the doctrine of res judicata bars her from raising the issue now. No attorney fees are awarded on appeal. Costs are awarded to respondent.

Chief Justice TROUT and Justice SCHROEDER concur.

1 .In December of 1989, the magistrate court held a hearing to determine the amount of principal child support owed to Worthington from the date of divorce in 1982 until December 1989. In May 1990, the magistrate court entered a judgment regarding the 1989 hearing. The parties refer to the amount of interest Worthington is claiming as pre-judgment interest because it arose prior to the 1990 judgment of the 1989 hearing. However, they also refer to the same interest as post-judgment interest because when each child support payment becomes due, it begins to accrue statutory interest as judgment interest. Thus, the interest is pre 1990 but also post due-date of payment, yet it is all one and the same interest. Interest on amounts after 1990 (true post-judgment interest) is not at issue in this case.

2 . The district court found that Worthington had noticed her motion to amend for June 7, 1990. However, no support for this finding is found in the record.

3 . The record does not contain Worthington's motion for the writ of execution.