Cain v. Jacox

IN THE SUPREME COURT OF THE STATE OF KANSAS
No. 109,079
DANITRA Y. CAIN,
Appellant,
v.
KENDYL L. JACOX,
Appellee.
SYLLABUS BY THE COURT
1.
Whether a claim is barred by the doctrine of res judicata is a question of law over
which appellate courts exercise unlimited review.
2.
The doctrine of res judicata is a common-law rule of equity grounded in both
notions of justice and in sound public policy, each of which demands that a party not be
vexed with litigation twice on the same cause. Before the doctrine of res judicata will bar
a successive suit, the following four elements must be met: (a) the same claim; (b) the
same parties; (c) claims that were or could have been raised; and (d) a final judgment on
the merits.
3.
When applying the res judicata rule, courts must be mindful of the equitable
principles animating the doctrine. Thus, courts must consider the substance of both the
first and subsequent action and not merely their procedural form. The doctrine may be
liberally applied, but it requires a flexible and common-sense construction in order to
vindicate the fundamental goals embedded in the requirements of justice and sound
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public policy. This framework neither favors nor disfavors the application of the rule in
any particular case. It merely requires that before the doctrine is either invoked or
rejected, a court must conduct a case-by-case analysis that moves beyond a rigid and
technical application to consider the fundamental purposes of the rule in light of the real
substance of the case at hand.
4.
Parties are the same for res judicata purposes when they are in privity with one
another. There is no generally prevailing definition of privity which can be automatically
applied to all cases. A determination of the question as to who are privies requires careful
examination of the circumstances of each case as it arises.
5.
As with the res judicata doctrine of which it is a part, privity is an equitable
determination grounded in principles of fundamental fairness and sound public policy.
Before privity can be invoked to satisfy the same party element of res judicata, there must
be a showing that the parties in the two actions are really and substantially in interest the
same.
Review of the judgment of the Court of Appeals in an unpublished opinion filed November 22,
2013. Appeal from Riley District Court; MERYL D. WILSON, judge. Opinion filed July 24, 2015.
Judgment of the Court of Appeals affirming the district court is reversed. Judgment of the district court is
reversed.
David P. Troup, of Weary Davis, L.C., of Junction City, argued the cause and was on the briefs
for appellant.
Blake Johnson, of Oleen Law Firm, of Manhattan, argued the cause, and Bentson Oleen, of same
firm, was with him on the briefs for appellee.
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The opinion of the court was delivered by
STEGALL, J.: Danitra Cain appeals from the denial of her motion to recover
postjudgment interest on unpaid child support judgments. The district court denied the
motion holding that the doctrine of res judicata barred Cain's claim. The Court of Appeals
affirmed. But we hold that because Cain was neither a party in a prior proceeding nor in
privity with a party in a prior proceeding, the doctrine of res judicata does not bar her
claim. We therefore reverse the contrary rulings by the district court and Court of
Appeals and remand the case to the district court for further proceedings.
FACTUAL AND PROCEDURAL BACKGROUND
In 1998, Danitra Cain gave birth to a daughter. Within a few months of the child's
birth, the Kansas Department of Social and Rehabilitation Services (SRS) commenced
this action in Riley County District Court. The court found that Kendyl Jacox was the
child's father and ordered him to pay child support. Soon after, having finished his
collegiate football career at Kansas State University, Jacox began what would become a
successful and financially rewarding career in the National Football League. As the years
went by, Jacox's child support obligations rose alongside his income. Unfortunately,
however, Jacox proved to be an unreliable—though wealthy—father.
By 2008, SRS notified the district court that it would be providing child support
enforcement services for Cain. SRS claimed Jacox owed $173,654.52 in back payments,
and the agency sought and was granted an income withholding order in that amount.
Garnishment proved difficult, if not impossible. Making further efforts to collect the
arrearages on behalf of Cain, SRS sought to enforce the district court's order by
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registering it in Texas (where Jacox was living) pursuant to the Uniform Interstate Family
Support Act (UIFSA), Tex. Family Code Ann. § 159.101 et seq. (Vernon 2014).
Texas took no action until 2011 when the Texas Attorney General, as that state's
child support enforcement agency under UIFSA, filed a notice of registration of a foreign
support order and sought its enforcement. The Texas Attorney General requested
judgment in the amount of $133,110.10 (representing the principal child support
arrearage as of April 1, 2011) with no accrued interest. The amount requested was based
on a spreadsheet provided by SRS listing both Jacox's monthly support obligations and
any support payments he had made. The spreadsheet did not include any calculation for
interest accrued.
The Texas district court held a hearing at which Jacox appeared and was
represented by counsel. Cain was present without counsel, though she was not formally a
party to the action. Following the hearing, the court determined that as of June 1, 2011,
Jacox was in arrears in the amount of $136,562.10 and entered judgment in that amount.
Cain signed the order with the notation from the court that Cain had agreed to the order
"only as to form." No appeal from this order was taken, and Jacox paid the judgment in
its entirety in 2011.
The following March, back in Kansas, Cain sought an order from the Riley
County District Court determining the amount of interest owed on the arrearages as of
October 14, 2011. Jacox asserted a res judicata defense. In both her pleadings and
testimony to the district court, Cain alleged that the Texas Attorney General would not
seek to enforce interest on the arrearages unless that amount was first reduced to a
judgment certain by the Riley County District Court. Jacox did not dispute this fact but
argued that pursuant to UIFSA, the Texas court had the authority to make the interest
calculation itself. As such, Jacox claimed that the four elements of res judicata had been
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met and that Cain's claim for interest was barred. See In re Tax Appeal of Fleet, 293 Kan.
768, Syl. ¶ 2, 272 P.3d 583 (2012) (before the doctrine of res judicata can apply, the
following four elements must be met: "[a] the same claim; [b] the same parties; [c]
claims that were or could have been raised; and [d] a final judgment on the merits").
The district court agreed with Jacox and found that Cain's claim for interest was
barred due to the res judicata effect of the Texas judgment. On appeal, a panel of our
Court of Appeals agreed. Cain v. Jacox, No. 109,079, 2013 WL 6164666, at *8 (Kan.
App. 2013) (unpublished opinion), rev. granted 300 Kan. 1103 (2014). Cain now appeals
to this court, and we exercise jurisdiction pursuant to K.S.A. 60-2101(b).
DISCUSSION
We exercise plenary review over the only question presented by this appeal—
whether the judgment of the Texas court should be given res judicata effect to bar Cain's
claim for interest in Riley County District Court. See In re Tax Appeal of Fleet, 293 Kan.
at 777. The doctrine of res judicata is a common-law rule of equity grounded in both
notions of justice and in sound public policy, each of which demands that a party not be
vexed with litigation twice on the same cause. Kansas has long recognized the basic
parameters of the rule that still obtain today.
As early as 1883, Justice Brewer, writing for this court, held:
"It is not only familiar law but manifest justice that a man should not be vexed twice with
the same litigation. Doubtless there are many exceptions to the letter of this rule, but
wherever the exceptions have been recognized, they have been based upon what seemed
necessary for the full protection of the rights of the parties. But when a question has been
once fully litigated, and every opportunity given to either party to present his case and to
have any supposed errors in the lower corrected by review in the highest court, it would
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seem an abuse of the rights of a litigant to compel him to enter upon a second litigation of
the same question." Comm'rs of Wilson Co. v. McIntosh, 30 Kan. 234, 236-37, 1 P. 572(1883).
As the rule is framed today, before the doctrine of res judicata will bar a successive suit,
the following four elements must be met: "(a) the same claim; (b) the same parties; (c)
claims that were or could have been raised; and (d) a final judgment on the merits." In re
Tax Appeal of Fleet, 293 Kan. 768, Syl. ¶ 2.
When applying the rule, Kansas courts must be mindful of the equitable principles
animating the doctrine. Thus, courts must consider the substance of both the first and
subsequent action and not merely their procedural form. See Comm'rs of Wilson Co., 30
Kan. at 238 ("We think there is a growing disposition to enlarge the scope of the doctrine
of res judicata, and to place more regard on the substance of the decision than on the
form of the proceedings."). The doctrine may be liberally applied, but it requires a
flexible and common-sense construction in order to vindicate its fundamental goals
which are embedded in the requirements of justice and sound public policy. See, e.g., In
re Estate of Reed, 236 Kan. 514, 519, 693 P.2d 1156 (1985) ("This rule is one of public
policy. . . . The doctrine of res judicata is, therefore, to be given a liberal application but
not applied so rigidly as to defeat the ends of justice."); Swigart v. Knox, 165 Kan. 410,
423, 196 P.2d 246 (1948) (Cowan, J., dissenting) ("The application of the doctrine of res
judicata is not inflexible. It is a rule of convenience and necessity but, like all such rules,
is not to be applied so rigidly as to defeat the ends of justice."); Interoceanica Corp. v.
Sound Pilots, Inc., 107 F.3d 86, 91 (2d Cir. 1997) (the doctrine of res judicata "must be
given a flexible, common-sense construction that recognizes the reality of the situation").
This framework neither favors nor disfavors the application of the rule in any particular
case. It merely requires that before the doctrine is either invoked or rejected, a court must
conduct a case-by-case analysis that moves beyond a rigid and technical application to
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consider the fundamental purposes of the rule in light of the real substance of the case at
hand.
With this framework in mind, we now turn to the lower courts' application of res
judicata to bar Cain's claim for postjudgment interest in Riley County District Court. The
parties spend the bulk of their arguments contesting the power of the Texas court under
UIFSA—or its lack thereof—to calculate and order the payment of interest on the child
support arrearages accumulated by Jacox over the many years of his sporadic
compliance. Indeed, this issue is at the heart of the panel's decision below as well.
Cain argues that the Texas court did not have the authority to calculate and order
interest on the arrearages and that, to the extent the Texas court did this, it impermissibly
modified the Kansas support order in violation of UIFSA. As such, Cain claims both that
the "same claim" and the "claim that could have been raised" elements of res judicata are
missing. Jacox argues that the Texas court did have the ability pursuant to UIFSA to
calculate and order interest without impermissibly modifying the Kansas support order.
Jacox contends that the Texas Attorney General asked the Texas court to include interest
in its enforcement order and that the court's failure to do so was either the result of an
agreement between Cain and Jacox or was a mistake that was not appealed. As such,
Jacox asserts that the claim in Texas included the question of postjudgment interest on
the arrearages and that it either was or could have been asserted.
The Court of Appeals panel agreed with Jacox, holding:
"While the Texas court, at the invitation of Kansas SRS and the Texas Attorney
General, erred in its calculation of the total amount due under the Kansas child support
order, this error was not a modification of the Kansas support order. The Texas court had
the power to make this calculation, and Cain could have revisited the issue of
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postjudgment interest in postjudgment proceedings before the Texas court or by an
appeal.
....
"Here, Cain could have sought postjudgment relief in the Texas court or appealed
the erroneous judgment, but she failed to do so, a lapse which very well may have been
caused not by her own neglect but by incorrect advice she obtained in the Texas
proceeding. The unfortunate consequence for her is that the Texas judgment was a final
judgment and the issue of postjudgment interest could not be relitigated later in Riley
County." Cain, 2013 WL 6164666, at *8.
But we need not consider the twin issues of whether (1) the registration via UIFSA
of a Kansas support order in Texas represents the same claim for res judicata purposes as
a preexisting child support action in a Kansas court with continuing jurisdiction that
straddles the Texas enforcement action; or (2) whether Texas had the authority under
UIFSA to calculate and order interest on child support arrearages based on the
registration of a Kansas support order that has not reduced the interest to a specific
amount. Instead, we can and do resolve the only issue before us on the grounds that Cain
and the Texas Attorney General were not the "same party" for res judicata purposes.
The district court's discussion of the "same parties" element of res judicata was
perfunctory and conclusory. The court merely stated: "Petitioner and respondent herein
appeared in the Texas proceeding. Clearly the same parties." The Court of Appeals
engaged in a more substantive consideration of this element. The panel recognized that
Cain was not a formal party to the Texas action because it was brought and litigated by
the Texas Attorney General as the support enforcement agency of that state under
UIFSA. The panel did note, however, that Cain was actually present in Texas during
those proceedings and was afforded the opportunity by the Texas court to approve the
order, which she chose to do as to "form only." Cain, 2013 WL 6164666, at *2, *5.
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The Court of Appeals next properly considered whether Cain and the Texas
Attorney General were in privity. Parties are the "same" for res judicata purposes when
they are in privity with one another. See Penachio v. Walker, 207 Kan. 54, 57, 483 P.2d
1119 (1971). The panel held:
"The interest the Texas Attorney General was pursuing was Cain's entitlement to
the unpaid amounts due on the Kansas court's support order. There was an identity of
interests between the Texas Attorney General and Cain such that the two were in privity
with one another. Thus, the parties were in essence the same in the Texas and later Riley
County proceedings." Cain, 2013 WL 6164666, at *6.
We disagree.
"There is no generally prevailing definition of 'privity' which can be automatically
applied to all cases. A determination of the question as to who are privies requires careful
examination into the circumstances of each case as it arises." Goetz v. Board of Trustees,
203 Kan. 340, 350-51, 454 P.2d 481 (1969). As with the doctrine to which it is a part,
privity is an equitable determination grounded in principles of fundamental fairness and
sound public policy. See Huelsman v. Kansas Dept. of Revenue, 267 Kan. 456, 458, 980
P.2d 1022 (1999) ("Whether a party is in privity with another . . . is a policy decision.");
St. Paul Fire & Marine Ins. Co. v. Tyler, 26 Kan. App. 2d 9, 18-19, 974 P.2d 611 (1999)
("[P]rivity is an equitable concept and equitable principles should apply. We conclude
there can be no privity between persons unless the result can be defended on principles of
fundamental fairness in a due process sense."). Before privity can be invoked to satisfy
the "same party" element of res judicata, there must be a showing that "the parties in the
two actions are really and substantially in interest the same." Lowell Staats Min. Co., Inc.
v. Philadelphia Elec. Co., 878 F.2d 1271, 1275 (10th Cir. 1989).
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To further his argument that Cain and the Texas Attorney General were pursuing
the same interests, Jacox points out that the Texas Attorney General asked the Texas
court to "enter judgment for all support arrearage and accrued interest as of the hearing
date." This is an important fact, but it is not conclusive. As stated above, we must look
past form to substance. The reality is that in child support enforcement proceedings such
as these, the pleadings are generally pro forma and include a variety of boilerplate
statements. The substance of the Texas Attorney General's filing was found in the
exhibits attached to and referenced in the filings. The exhibits included the Riley Court
District Court support orders and the spreadsheet prepared by SRS showing the
arrearages.
But as a function of Kansas law, neither of the Kansas documents comprising the
substance of the claim made by the Texas Attorney General asserted that Jacox owed any
postjudgment interest. While a Kansas district court has the authority to reduce interest
owed on child support arrearages to an amount certain and to enter judgment in that
amount, the actual legal obligation to pay postjudgment interest accrues and attaches as a
matter of law without the need for a specific court order. See K.S.A. 16-204(d). But
Kansas child support enforcement agencies (SRS in this case) are prohibited from making
the interest calculation themselves. Instead, the scope of SRS's enforcement services
pertaining to postjudgment interest is "limited to enforcement of a lump sum previously
determined by a tribunal of competent jurisdiction." See K.A.R. 30-44-5(a).
Therefore, because the postjudgment interest due and owing on the child support
arrearages had never been reduced to an amount certain by the Riley County District
Court, SRS was legally unable to pursue the recovery of that amount in Texas during the
enforcement proceeding pursuant to UIFSA. And because the substance of the Texas
Attorney General's claim in the Texas court was limited by the recovery sought by SRS,
the Texas Attorney General had no interest or stake in recovering or enforcing any
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postjudgment interest amounts owed under Kansas law. Cain, on the other hand, clearly
did have such a stake. Given this, we must conclude that Cain and the Texas Attorney
General did not share an interest that was "really and substantially" the same. There was
no privity and the "same party" element of the res judicata test is not met, thus ending our
analysis. We reverse the lower courts' findings that Cain's claims are barred by the
doctrine of res judicata and remand this matter to the district court for further
proceedings.
Finally, we take up and grant Cain's motion for attorney fees. Cain's appellate
attorney fees are allowable at the discretion of this court when the district court would
have authority to award such fees. Supreme Court Rule 7.07(b)(1) (2014 Kan. Ct. R.
Annot. 70). District courts are granted authority to award reasonable attorney fees in such
cases. K.S.A. 2014 Supp. 23-2216(a). We have considered Cain's motion, attached
affidavit, and note that Jacox did not file a reply in opposition to the motion. We
conclude that, because Cain's appellate attorney fees were occasioned entirely by Jacox's
failure to comply with support orders at the time they were made, the award of appellate
attorney fees is justified—especially considering the aggravating factor that Jacox clearly
had the means to comply. We further conclude that the amount Cain requests is
reasonable and should be allowed. Cain's motion for appellate attorney fees and costs is
therefore granted.
The judgment of the Court of Appeals affirming the district court is reversed. The
judgment of the district court is reversed, and the matter is remanded to the district court
for a calculation of the postjudgment interest owed on the child support arrearages.
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