Ferrells Logging & Lumber, Inc. v. Kim Spencer

RENDERED: JULY 7, 2023; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2021-CA-1195-MR
FERRELLS LOGGING & LUMBER,
INC. APPELLANT
APPEAL FROM MENIFEE CIRCUIT COURT
v. HONORABLE WILLIAM EVANS LANE, JUDGE
ACTION NO. 20-CI-90080
KIM SPENCER APPELLEE
OPINION
AFFIRMING
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BEFORE: ACREE, CETRULO, AND GOODWINE, JUDGES.
ACREE, JUDGE: Appellant, Ferrell’s Logging and Lumber, Inc., appeals the
Menifee Circuit Court’s denial of its motion to set aside a judicial sale of real
property. Appellant argues the sale should not have been confirmed because
Appellant never received notice of the sale pursuant to CR1 53.02. Finding no
error, we affirm.2
BACKGROUND
Appellant purchased delinquent tax bills against real property in
Menifee County and then filed a circuit court action demanding judgment on its
certificates of delinquency. Appellant also demanded the property be sold by
judicial sale, and that the proceeds be used to satisfy the anticipated judgment. On
March 3, 2021, Appellant obtained a judgment of $5,162.37, and the circuit clerk
mailed an Order of Sale to all parties; Appellant did not submit a written bid to the
Master Commissioner after receiving a copy of the Order of Sale.
The Master Commissioner filed a Notice of Commissioner’s Sale on
March 9, 2021, scheduling the sale for April 7, 2021. The Master Commissioner
mistakenly failed to send a copy to Appellant or Appellant’s attorney and did not
include them in the certificate of service. The Master Commissioner did, however,
post the Notice of Sale in the Mount Sterling Advocate, a newspaper in adjacent
1
Kentucky Rules of Civil Procedure.
2
Appended to Appellant’s brief are two Findings of Fact, Conclusions of Law, and Orders, by
which the circuit court denied Appellant’s Motion to Set Aside Master Commissioner’s Sale in
both. The first is dated July 1, 2021, and the second is dated September 8, 2021.
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Montgomery County,3 as required by KRS 426.200(2)4 and KRS 426.560.5 The
Notice appeared in the newspaper for three consecutive weeks as required by KRS
424.130(c). The Master Commissioner also posted the Notice at the Menifee
County Courthouse.
Appellee Kim Spencer purchased the property at the sale. Sometime
afterward, Appellant asked the Master Commissioner when the sale would be, and
the Master Commissioner told Appellant the sale had already occurred. Appellant
then filed a motion with the circuit court, requesting that the sale be set aside and
rescheduled. The circuit court denied the motion, and Appellant now appeals.
ANALYSIS
The decision whether to confirm or vacate a judicial sale lies within
the discretion of the circuit court, and we will not disturb the circuit court’s
3
Kentucky Revised Statutes (KRS) 424.120 provides the qualifications of newspapers which are
sufficient to advertise such notice. Generally, the statute requires notice be advertised in a
regularly published newspaper which is the largest in a geographic publication area. Appellant
does not contest that the Mount Sterling Advocate is the appropriate newspaper in which to
advertise the Notice of Commissioner’s Sale.
4
“The officer making the sale shall first advertise the time and place of sale by written notice
describing the land to be sold, posted at the courthouse door and three other places in the vicinity
of the land for fifteen days next preceding the sale, or by newspaper notice if required by KRS
426.560.”
5
KRS 426.560 states, as relevant: “In addition to the notices now required by statute to be
posted, all public sales of any kind of property sold under execution, judgment or decree, shall,
unless otherwise agreed upon by the parties, be advertised by publication pursuant to KRS
Chapter 424. The advertisement shall state the time, place and terms of sale and describe the
property to be sold.”
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decision unless our review reveals an abuse of discretion. Lerner v. Mortg. Elect.
Registration Sys., Inc., 423 S.W.3d 772, 773 (Ky. App. 2014) (citing Gross v.
Gross, 350 S.W.2d 470, 471 (Ky. 1961)). “The test for abuse of discretion is
whether the trial judge’s decision was arbitrary, unreasonable, unfair, or
unsupported by sound legal principles.” Commonwealth v. English, 993 S.W.2d
941, 945 (Ky. 1999) (citations omitted).
Appellant asserts here, as it asserted before the circuit court, that the
Master Commissioner failed to strictly comply with CR 53.02. As relevant, CR
53.02 requires the master commissioner to “serve notice of the date, time and place
of the judicial sale upon every party who is not in default for failure to appear.”
CR 53.02(1). Appellant argues that, because the Master Commissioner did not
serve notice upon Appellant despite the requirement that he “shall” do so, the sale
ought to be set aside.
CR 53.02 itself does not provide the remedy Appellant seeks when a
master commissioner fails to send notice to all parties. See CR 53.02. The issue
is, however, addressed in our jurisprudence – a judicial sale “ought not to be
lightly disapproved where it was conducted in a fair and regular manner, and
confirmation ought not to be refused except for substantial reasons.” Gross, 350
S.W.2d at 471.
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Appellee cites a case claimed to be analogous to these facts, Kissell
Co. v. Chadwick, a case in which failure to provide notice of a master
commissioner’s sale did not provide grounds to set aside the sale. 737 S.W.2d
710, 711 (Ky. App. 1987). In Kissell, the appellant filed a foreclosure action
resulting in a judgment and order of sale. Id. at 710. Before the master
commissioner scheduled the sale, the appellant’s counsel contacted the master
commissioner’s office to find out when the sale would be held. Id. at 711. The
master commissioner’s office had not yet set a date but told the appellant’s counsel
the office would contact counsel once a sale was scheduled. Id. The master
commissioner selected a date and properly advertised the sale. Id. Ultimately,
however, the master commissioner did not contact the appellant or his counsel and
the sale proceeded. Id. The circuit court granted the appellee’ s motion to confirm
the sale and this Court affirmed, holding “we do not consider appellant’s counsel
not receiving special notice of the sale date as even close to sufficient reason for
setting aside the sale.” Id.Of course, a difference does exist between Kissell and the current
appeal. Here, the Master Commissioner did not send Appellant notice as required
by CR 53.02, while in Kissell the appellant did not receive notice which it had
specially requested from the master commissioner’s office. See Kissell, 737
S.W.2d at 711. However, we view this as a distinction without a difference.
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Kissell is sufficiently analogical to persuade us to affirm. The Master
Commissioner advertised the sale in a newspaper and posted notice of the sale at
the courthouse as was required and made no mistake in conducting the sale other
than inadvertently failing to provide specific notice to Appellant. It was not
arbitrary or unreasonable for the circuit court to conclude the omission was not a
substantial reason sufficient to refuse to confirm the sale, and thus the circuit court
did not abuse its discretion.
CONCLUSION
For the foregoing reasons, we affirm the Menifee Circuit Court’s
Findings of Fact, Conclusions of Law, and Order.
ALL CONCUR.
BRIEF FOR APPELLANT: BRIEF FOR APPELLEE:
Ira S. Kilburn Michelle R. Williams
Salt Lick, Kentucky Mt. Sterling, Kentucky
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