U.S. Equities Corp. v. Ceraldi

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U.S. EQUITIES CORP. v. PEGGY CERALDI
(AC 41648)
DiPentima, C. J., and Sheldon and Bear, Js.
Syllabus
The plaintiff brought an action against the defendant seeking to collect a
credit card debt allegedly owed by the defendant. In May, 2011, following
the defendant’s default for failure to plead, the trial court granted the
plaintiff’s motion for judgment and awarded the plaintiff monetary dam-
ages, attorney’s fees, costs and postjudgment interest pursuant to, inter
alia, the statute (§ 37-3a) that allows the recovery of up to 10 percent
interest in civil actions as damages for the detention of money after it
becomes payable. The court did not set the rate of interest. In March,
2018, the plaintiff filed a motion for clarification, requesting that the
court clarify its judgment to reflect that it had awarded postjudgment
interest at a rate of 10 percent per year. In its order granting the plaintiff’s
motion, the trial court stated that it had intended that the postjudgment
interest rate be set at the maximum allowable rate of 10 percent per year.
On appeal, the defendant claimed that the trial court’s order granting
the motion for clarification and setting, for the first time, the rate of
postjudgment interest it had intended to award, constituted an improper
substantive modification of the judgment. Held that the trial court lacked
the authority to set the postjudgment interest rate at 10 percent approxi-
mately seven years after the judgment had been rendered, as that court’s
order constituted an improper substantive modification of the judgment,
which did not set forth any interest rate, and the plaintiff did not move
to open the judgment to determine the rate of interest within the four
month postjudgment period as prescribed by the applicable statute (§ 52-
212a); accordingly, the judgment was reversed and the case was
remanded with direction to dismiss the plaintiff’s untimely motion for
clarification and to correct the judgment to reflect that no postjudgment
interest was properly awarded.
Argued October 23—officially released December 18, 2018
Procedural History
Action to collect a debt, and for other relief, brought
to the Superior Court in the judicial district of New
Britain, where the defendant was defaulted for failure
to plead; thereafter, the court, Swienton, J., granted the
plaintiff’s motion for judgment and rendered judgment
thereon; subsequently, the court granted the plaintiff’s
motion for clarification and issued a certain order, and
the defendant appealed to this court. Reversed; judg-
ment directed.
Joanne S. Faulkner, for the appellant (defendant).
Linda Strumpf, for the appellee (plaintiff).
Opinion
BEAR, J. The defendant, Peggy Ceraldi, appeals from
the judgment of the trial court granting the postjudg-
ment motion for clarification filed by the plaintiff, U.S.
Equities Corp., regarding the postjudgment interest rate
to be applied to the judgment rendered against the
defendant in the underlying debt collection action.1 The
defendant claims that the court’s clarification actually
was an improper substantive modification of the judg-
ment. We agree and, accordingly, reverse the judgment
setting the rate of postjudgment interest.
The following facts and procedural history are rele-
vant to the disposition of this appeal. The plaintiff was
assigned all rights to the defendant’s Chase Bank credit
card account from Turtle Creek Assets, Ltd. On Decem-
ber 18, 2010, the plaintiff commenced this action, seek-
ing monetary damages of $17,886.99, prejudgment
interest, attorney’s fees of $2683.05, costs of the action,
and ‘‘statutory postjudgment interest of 10 [percent]
per annum.’’ On May 31, 2011, the court granted the
plaintiff’s motion for judgment following the defen-
dant’s default for failure to plead. In its order granting
the motion, the court awarded the plaintiff $30,895 in
monetary damages, $2683.05 in attorney’s fees, $343.20
in costs, and postjudgment interest pursuant to General
Statutes §§ 37-3a2 and 52-356d (e).3 The court, however,
did not set forth in its order the rate of postjudgment
interest.4
On June 27, 2017, the defendant filed a motion for a
protective order claiming that, after the defendant had
paid the court-ordered weekly payments in an amount
exceeding $10,000, the plaintiff incorrectly notified her
that she still owed more than $43,000 on the judgment
because of its unilateral application of a 10 percent
annual postjudgment interest rate on the unpaid amount
of the judgment. The defendant requested that the judg-
ment be retroactively modified to the original amount
claimed and that postjudgment interest be denied. On
July 24, 2017, the court denied the defendant’s motion
for a protective order, stating that the proper motion
for the relief requested by the defendant was a motion
to open the judgment. On September 1, 2017, the defen-
dant filed a motion to open the judgment, which the
court denied on September 18, 2017.
On October 6, 2017, the defendant appealed the
court’s judgment denying her motion for a protective
order. See footnote 1 of this opinion. On March 4, 2018,
during the pendency of that appeal, the plaintiff filed
a motion for clarification with the trial court requesting
that the court’s May 31, 2011 judgment be clarified to
reflect that the rate at which it had awarded postjudg-
ment interest was 10 percent per year. On April 30, 2018,
the court granted the plaintiff’s motion for clarification,
stating that when it had rendered judgment on May 31,
2011, it had done so in accordance with the plaintiff’s
request for relief set forth in its complaint and had
intended that the interest rate be set at the maximum
allowable rate of 10 percent per year. This appeal
followed.
The defendant’s principal claim on appeal is that the
court’s order granting the motion for clarification and
setting forth for the first time the rate at which it had
intended postjudgment interest to be awarded, consti-
tuted an improper substantive modification of the judg-
ment. The defendant argues that the court lacked
authority to set a postjudgment interest rate approxi-
mately seven years after the judgment because the
plaintiff did not seek to have the judgment opened to
determine the rate of postjudgment interest within four
months of the May 31, 2011 judgment. See General
Statutes § 52-212a and Practice Book § 17-4.
The plaintiff counters that, because postjudgment
interest already had been awarded in the judgment, the
court’s order granting the motion for clarification was
not a substantive modification of the judgment.5 The
plaintiff asserts that the court had authority to specify
the postjudgment interest rate through a motion for
clarification, which is not time barred.6 We disagree.
We first set forth the applicable standard of review.
‘‘Motions for interpretation or clarification, although
not specifically described in the rules of practice, are
commonly considered by trial courts and are procedur-
ally proper. . . . A motion for clarification may be
appropriate where there is an ambiguous term in a
judgment . . . but, where the movant’s request would
cause a substantive modification of an existing judg-
ment, a motion to open or set aside the judgment would
normally be necessary.’’ (Citations omitted; internal
quotation marks omitted.) Rome v. Album, 73 Conn.
App. 103, 109, 807 A.2d 1017 (2002).
When a party has filed a motion for clarification seek-
ing a ruling on its entitlement to postjudgment interest,
this court has looked to the substance of the claim
rather than the form of the motion. See Bower v. D’On-
fro, 45 Conn. App. 543, 547, 696 A.2d 1285 (1997)
(‘‘[e]ven though the . . . motion was captioned motion
for clarification, we look to the substance of the claim
rather than the form’’ [internal quotation marks omit-
ted]). Furthermore, this court has recognized that
‘‘rather than being bound by the caption of the motion,
the [trial] court must examine the practical effect of
the ruling.’’ (Internal quotation marks omitted.) Rome
v. Album, supra, 75 Conn. App. 111. In the present case,
the defendant argues that the practical effect of the
court’s order granting the motion for clarification was
a substantive modification of the judgment. We agree.
Assigning or adding, postjudgment, a rate of postjudg-
ment interest on a debt collection judgment constitutes
a substantive modification of that judgment. See Cliff’s
Auto Body, Inc. v. Grenier, 179 Conn. App. 820, 827,
181 A.3d 138 (2018). The plaintiff argues, however, that
Cliff’s Auto Body, Inc., is not applicable to the present
case because postjudgment interest was awarded by
the court in the May 31, 2011 judgment. The court,
however, did not set forth in the judgment the rate of
postjudgment interest which, pursuant to § 37-3a, could
have been 10 percent or some lower rate per year,
and that omission precluded both the plaintiff and the
defendant from knowing what postjudgment interest
rate was to be applied.7 The court, approximately seven
years after the judgment was rendered, for the first
time set forth the rate of postjudgment interest it had
intended to award. The court’s order granting the
motion for clarification, therefore, constituted an
improper substantive modification of the judgment.
‘‘Our case law establishes that any substantive modi-
fication of a judgment constitutes an opening of the
judgment. The issue of whether a particular action by
the trial court opens the judgment typically arises when
the court alters the judgment more than four months
after the judgment was rendered and a party challenges
the court action as an untimely opening of the judgment
. . . . Both General Statutes § 52-212a8 and Practice
Book § 17-49 provide that the trial court lacks the power
to open a judgment more than four months after the
judgment is rendered.’’ (Citations omitted; emphasis
added; footnotes added; internal quotation marks omit-
ted.) Id., 826–27.10
In seeking a substantive modification of the judg-
ment, the plaintiff should have filed a motion to open the
judgment within the four month postjudgment period
specified in § 52-212a and Practice Book § 17-4. ‘‘Our
rules of practice permit a party, within four months of
a judgment, to move to open the judgment when there
is a good and compelling reason for its modification or
vacation. . . . Although the granting of a motion to
open is within the discretion of the trial court . . .
inadvertent failure to determine the reasonable rate of
interest after this matter has properly been presented
to the trial court might well qualify as a good and com-
pelling reason to modify a judgment.’’ (Citations omit-
ted; internal quotation marks omitted.) Hartford v. CBV
Parking Hartford, LLC, 330 Conn. 200, 229, 192 A.3d
406 (2018). In the present case, because the plaintiff did
not seek to have the debt collection judgment opened
to determine the rate of postjudgment interest within
four months of May 31, 2011, when the judgment was
rendered, the court lacked the power to determine the
rate of postjudgment interest. See Cliff’s Auto Body,
Inc. v. Grenier, supra, 179 Conn. App. 827. On April 30,
2018, the court lacked authority to set the postjudgment
interest rate at 10 percent because the original May 31,
2011 judgment did not set forth any interest rate and
the plaintiff did not move to open the judgment within
the four month postjudgment period as prescribed by
§ 52-212a.11
The judgment is reversed and the case is remanded
with direction to dismiss the plaintiff’s untimely motion
for clarification and to correct the judgment to reflect
that no postjudgment interest was properly awarded.
In this opinion the other judges concurred.
1
This is the defendant’s second appeal in this case. The defendant’s first
appeal arose from the court’s denial of her motion for a protective order
(AC 40917). We ordered, sua sponte, that both appeals be heard together.
We found no error in the court’s decision to deny the defendant’s motion
for a protective order and, therefore, affirmed the court’s judgment in that
appeal. See U.S. Equities Corp. v. Ceraldi, 186 Conn. App. 903, A.3d
(2018).
2
General Statutes § 37-3a provides in relevant part that ‘‘interest at the
rate of ten per cent a year, and no more, may be recovered and allowed in
civil actions . . . including actions to recover money loaned at a greater
rate, as damages for the detention of money after it becomes payable. . . .’’
3
General Statutes § 52-356d (e) provides that ‘‘[i]interest on a money
judgment shall continue to accrue under any installment payment order on
such portion of the judgment as remains unpaid.’’
4
The court further ordered the defendant to make weekly payments of
$35 commencing three weeks after the date notice of the order was sent.
The parties do not dispute that the defendant has timely made payments
to the plaintiff since 2011. The defendant claims that the total of those
payments is in excess of $10,000.
5
The plaintiff also renews its claim, made in a motion to dismiss that
was denied by this court, that the order granting the motion for clarification
was not appealable because the motion did not give rise to a new appeal
period pursuant to Practice Book § 63-1 (c) (1), which provides in relevant
part: ‘‘If a motion is filed within the appeal period that, if granted, would
render the judgment, decision, or acceptance of the verdict ineffective,
either a new twenty day period or applicable statutory time period for filing
the appeal shall begin on the day that notice of the ruling is given on the
last such outstanding motion . . . . Motions that do not give rise to a new
appeal period include those that seek: clarification or articulation, as
opposed to alteration, of the terms of the judgment or decision . . . .’’
Because we view the court’s order granting the motion for clarification
as one granting a motion to open and modify the judgment; see Bower v.
D’Onfro, 45 Conn. App. 543, 547, 696 A.2d 1285 (1997); we accordingly reject
the plaintiff’s claim that its motion did not give rise to a new appeal period.
6
‘‘There is no time restriction imposed on the filing of a motion for
clarification.’’ (Internal quotation marks omitted.) Bower v. D’Onfro, 45
Conn. App. 543, 547 n.6, 696 A.2d 1285 (1997).
7
General Statutes § 37-3c, in contrast to § 37-3a, ‘‘unambiguously dictates
that, when the judgment of compensation does not include a rate of interest
. . . the default rate applies.’’ (Internal quotation marks omitted.) Hartford
v. CBV Parking Hartford, LLC, 330 Conn. 200, 226, 192 A.3d 406 (2018). If,
however, a trial court fails to include a specific rate of interest pursuant to
§ 37-3a, as in the present case, there is no default interest rate that automati-
cally applies as a matter of law. See Urich v. Fish, 112 Conn. App. 837, 844,
965 A.2d 567 (‘‘[a]s an award of postjudgment interest [pursuant to § 37-3a]
is discretionary, the plaintiff’s argument that he is entitled to postjudgment
interest as a matter of law [pursuant to § 37-3a] is premised on a misreading
of statutory authority’’), cert. denied, 292 Conn. 909, 973 A.2d 109 (2009).
Moreover, our Supreme Court has held that § 37-3a establishes that a trial
court has broad discretion to award a rate of postjudgment interest up to
ten percent per year, but that it need not award ten percent interest if in
its discretion a lower rate of interest is more appropriate. See Sears, Roe-
buck & Co. v. Board of Tax Review, 241 Conn. 749, 765–66, 699 A.2d 81 (1997).
8
General Statutes § 52-212a provides in relevant part that ‘‘a civil judgment
or decree rendered in the Superior Court may not be opened or set aside
unless a motion to open or set aside is filed within four months following
the date on which it was rendered or passed. . . .’’
9
Practice Book § 17-4 (a) provides in relevant part that ‘‘[u]nless otherwise
provided by law . . . any civil judgment or decree rendered in the superior
court may not be opened or set aside unless a motion to open or set
aside is filed within four months succeeding the date on which notice was
sent. . . .’’
10
The trial court has ‘‘the authority to treat the [plaintiff’s] motion to
clarify as a motion to open and to grant the [plaintiff’s] requested relief where
the [plaintiff’s] motion (1) came within the four month period established
by § 52–212a; (2) put the [defendant] on notice as to the effect of the relief
requested despite the label affixed to the motion . . . and (3) sought to
correct an error of omission, and (4) the findings contained in [the judgment]
clearly expressed the court’s intent as to that property.’’ (Citation omitted;
internal quotation marks omitted.) Rome v. Album, supra, 73 Conn. App.
111–12.
11
Because we conclude that the court lacked authority to grant the motion
for clarification, which in substance was a motion to open and modify the
judgment to add postjudgment interest at an annual rate of ten percent, we
need not reach the other equitable claims raised by the defendant.