Opinion ID: 6210
Heading Depth: 2
Heading Rank: 3

Heading: Reformation of the Judgment

Text: 29 According finality to the prior bankruptcy court action in this case does not end our inquiry. The Federal Rules of Civil Procedure provide various methods for reforming judgments. Of these, one in particular, Rule 60(a), may be available to provide the government with relief from part of the overpayment. We will review the various methods of reforming judgments in order to see which is best suited to carrying out the intent of Kellogg and the government in signing the settlement agreement. 30 The first mistake described above, computing interest from the carryback date as opposed to the overpayment date, is the sort of substantive error which Rule 60(b) was designed to correct. Fed.R.Civ.P. 60(b) provides for relief of a party from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect. Fed.R.Civ.P. 60(b). 31 Rule 60(b) is not the appropriate method for reforming the settlement agreement in this case, however, because a Rule 60(b) motion, shall be made within a reasonable time, and ... not more than one year after the judgment, order, or proceeding was entered or taken. Fed.R.Civ.P. 60(b). The government delayed over two years after the original settlement agreement became final before petitioning in the present adversary proceeding for relief. It can therefore make no argument in favor of granting relief from the judgment under Rule 60(b) because any such motion is time barred. 3 32 However, the power of a court to reform a judgment under Rule 60(a) is not limited by the one year constraint of Rule 60(b). Rule 60(a) provides that [c]lerical mistakes in judgments, orders or other parts of the record and errors therein arising from oversight or omission may be corrected by the court at any time of its own initiative or on the motion of any party and after such notice, if any, as the court orders. Fed.R.Civ.P. 60(a). The lower court in this case failed to consider Rule 60(a) as a possible avenue for correcting the government's mistaken overpayment of interest and we remand for a consideration of the applicability of this rule to the situation of this case. 4 33 Although the reach of Rule 60(a) has been notably narrowed, it may be available to provide relief in the present case. In Harcon Barge Co., Inc. v. D & G Boat Rentals, Inc., 784 F.2d 665, 668-69 (5th Cir.1986) (en banc) cert. denied, 479 U.S. 930, 107 S.Ct. 398, 93 L.Ed.2d 351 (1986) we addressed the restrictions which have been placed on this rule: 34 The scope of Rule 60(a) is, as we have noted, very limited. In Dura-Wood Treating Co., Division of Roy O. Martin Lumber Co. v. Century Forest Industries, Inc., [694 F.2d 112, 114 (5th Cir.1982) ], the court set out these limits: 35 Rule 60(a) finds application where the record makes apparent that the court intended one thing but by merely clerical mistake or oversight did another. Such a mistake must not be one of judgment or even of misidentification, but merely of recitation, of the sort that a clerk or amanuensis might commit, mechanical in nature ... [Citations omitted] 36 Thus it is proper to use Rule 60(a) to correct a damages award that is incorrect because it is based on an erroneous mathematical computation, whether the error is made by the jury or by the court.... Correction of an error of substantive judgment, therefore, is outside the reach of Rule 60(a). 37 A mistake correctable under Rule 60(a) need not be committed by the clerk or the court and Rule 60(a) is even available to correct mistakes by the parties. Warner v. Bay St. Louis, 526 F.2d 1211, 1212 (5th Cir.1976) (mistakes correctable by Rule 60(a) are not necessarily made by the clerk); Pattiz v. Schwartz, 386 F.2d 300, 303 (8th Cir.1968) (mistakes by parties correctable by Rule 60(a)). 38 The exact cause of the second mistake, miscalculating statutory interest on the final refund, cannot be discerned from the record as presented to this court. While the government has miscalculated the exact amount of interest, the district court must evaluate the available evidence to discern what caused the mistake and ensure that it is the sort of clerical or mathematical error which is susceptible of reformation. 39 We have addressed at various times the scope of errors correctable under Rule 60(a) and review them today to aid the lower courts in applying the precedents to the facts of this case. The rule allows courts to modify their judgment in order to insure that the record reflects the actual intentions of the court and the parties. The court's responsibility in this case is to correct errors, created by mistake, oversight, or omission, that cause the record or judgment to fail to reflect what was intended at the time of trial. Warner, 526 F.2d at 1212; see also Robi v. Five Platters, Inc., 918 F.2d 1439, 1445 (9th Cir.1990) ([a] district court judge may properly invoke Rule 60(a) to make a judgment reflect the actual intentions and necessary implications of the court's decision.). 40 Although the relevant case law does not provide a bright line rule as to when Rule 60(a) can be applied, we hope a review will nevertheless present a more coherent picture of the area. We begin the evaluation by looking at our decision in Warner. In that case this court refused to treat a miscalculation in the amount of interest as correctable under Rule 60(a). 526 F.2d at 1212. The court was faced with a situation in which the district court entered a 6% interest rate on a judgment, overlooking an increase to 8% in the applicable interest rate enacted by the Mississippi legislature. We held that this was an error of law, rather than a typographical error, which was not correctable by Rule 60(a). Id. 41 Other opinions have limited Rule 60(a) because the change sought under the rule was substantive in nature. The decision in In re Galiardi prevented a lower court from using Rule 60(a) to amend a transfer order by specifying the reason for the order. 745 F.2d 335, 336 (5th Cir.1984) (per curiam). The court held that this was a change in the substance of the judgment and thus Rule 60(a) was not appropriate. Id. In Trahan v. First National Bank of Ruston, 720 F.2d 832 (5th Cir.1983), we faced a case in which a district court directed the defendant to pay an additional amount to compensate the plaintiff for a depreciation in the value of the stock awarded to him. The depreciation occurred due to delay caused by an appeal filed by the defendant. We ruled that this was a correction of the substantive nature of the judgment and could not be effected by Rule 60(a). Id. at 834. Likewise, in Britt v. Whitmire, 956 F.2d 509 (5th Cir.1992) we decided that a motion to amend and broaden a previous summary judgment order to dismiss all instead of part of the plaintiff's claims could not be a Rule 60(a) motion because the change was substantive in that it was not at all clear that the district court intended summary judgment on all the claims. 42 By contrast, in In re American Precision Vibrator Co., 863 F.2d 428 (5th Cir.1989) we held that where the clerk had failed to timely docket one party's opposition to a motion to dismiss, the court could rectify the resulting erroneous order dismissing the case under Rule 60(a). In another case, Chavez v. Balesh, 704 F.2d 774 (5th Cir.1983), we held that a the trial court properly utilized rule 60(a) to correct a failure to include liquidated damages in a judgment despite the court's clear intention to do so as expressed in the findings of fact. 43 In sum, the relevant test for the applicability of Rule 60(a) is whether the change affects substantive rights of the parties and is therefore beyond the scope of Rule 60(a) or is instead a clerical error, a copying or computational mistake, which is correctable under the Rule. As long as the intentions of the parties are clearly defined and all the court need do is employ the judicial eraser to obliterate a mechanical or mathematical mistake, the modification will be allowed. If, on the other hand, cerebration or research into the law or planetary excursions into facts is required, Rule 60(a) will not be available to salvage the government's blunders. Let it be clearly understood that Rule 60(a) is not a perpetual right to apply different legal rules or different factual analyses to a case. It is only mindless and mechanistic mistakes, minor shifting of facts, and no new additional legal perambulations which are reachable through Rule 60(a). 44 We therefore vacate the decision of the lower courts and remand for consideration of the preceding issues. If the government can show that the check sent to Kellogg does not reflect the intentions of the parties, and that relief will be in the form of correcting a computational mistake, then the district court has a responsibility to make the appropriate adjustments. 5 Our review of the case shows that the substantive rights of the parties do not seem to be in dispute since these rights were determined through the settlement and the fifteen point agreement appended thereto. Additionally, Kellogg himself has recognized the existence of this mathematical mistake. Thus, correction of the exact amount paid looks to be a matter of altering the payment to reflect the amount actually owed by the government. However, the burden of making this determination falls to the lower court in looking at the specific nature of the mistake made in the settlement of this case.