Opinion ID: 2262399
Heading Depth: 1
Heading Rank: 5

Heading: Credit for Third Party Settlements

Text: [¶ 22] In a separate action commenced in 1990, SKA alleged that Mr. Dorr and his associates had fraudulently conveyed property in which it had an interest to Bill Dorr (Mr. Dorr's father) and First Interstate Bank, among others. Bill Dorr paid SKA $10,000 to settle the claim and First Interstate Bank paid $40,000. Mr. Dorr argues that the district court erred by refusing to credit the settlement amounts against SKA's $105,163.78 monetary judgment. [¶ 23] As Mr. Dorr correctly points out, Wyoming law does not favor double recoveries for the same legal injury. See, e.g., Miller v. Campbell County, 901 P.2d 1107, 1113 (Wyo.1995); UNC Teton Exploration Drilling, Inc. v. Peyton, 774 P.2d 584, 592 (Wyo.1989). A judgment debtor is, therefore, entitled to credit against a judgment for a settlement that pertains to claims included in the judgment, but is not entitled to credit for settlement of claims that were not part of the judgment. See, Ultra Resources, Inc. v. Hartman, 2010 WY 36, ¶ 146, 226 P.3d 889, 934-35 (Wyo.2010). The party asserting satisfaction of a judgment has the burden of proof. 47 Am.Jur.2d Judgments § 812 (2010). See also, Redwine v. Rohlff Lumber & Supply Co., 54 Wyo. 253, 91 P.2d 49, 51-52 (Wyo.1939). [¶ 24] The decision about whether a credit against an outstanding judgment should be allowed is controlled by principles of equity. Ultra, ¶ 145, 226 P.3d at 934, quoting Cargill, Inc. v. Mountain Cement Co., 891 P.2d 57, 67 (Wyo.1995). The district court has discretion in determining whether to allow a set off. Id. We, therefore, apply the abuse of discretion standard when reviewing a district court's decision on a request for a set off. Id. [¶ 25] The district court held an evidentiary hearing on the set off matter. It issued a comprehensive decision letter detailing the course of proceedings in the relevant actions and making numerous factual findings about those proceedings. It noted that the arbitration award rendered against Dorr and Associates in favor of SKA, which was confirmed by the district court and this Court, contained two components: 1) it awarded SKA $105,163.78 for unpaid compensation for 1988 and the portion of 1989 before dissolution and for violation of the dissolution provisions of the partnership agreement; and 2) it directed Dorr and Associates to return to SKA the proceeds of a particular bank account, all accounts receivable existing as of May 4, 1989, as well as any sums paid on those accounts afterward, and all computer software. [¶ 26] The district court also described SKA's separate fraudulent conveyance action which led to the Bill Dorr and First Interstate Bank settlements. Ruling that the disputed settlements did not pertain to the monetary award included in the arbitration order, the district court stated: The Court is convinced that [Dorr] is not entitled to credit for these payments. The original arbitration award provided for both a monetary award and for a return to [SKA] of certain property it had contributed to the partnership. [SKA] filed a fraudulent conveyance suit to recover portions of that property. Bill Dorr and First Interstate Bank paid money to buy their peace. The settlement probably represented at least a part of the non-monetary award, although there is no way at this point in time to determine what additional actual and potential exposure each settling party paid money to avoid.... It is sufficient to conclude that the funds were paid by strangers to the original partnership to settle claims which had nothing to do with the original monetary award, and that [Dorr] has not met its burden of proving credit should be given. Redwine [v. Rohlff Lumber & Supply Co., 54 Wyo. 253, 91 P.2d 49, 51-52 (Wyo.1939)]. Credit for these settlement amounts will therefore be denied. [¶ 27] In support of his argument that the district court abused its discretion by concluding that the Bill Dorr and First Interstate Bank settlements were not connected to the monetary judgment against Dorr and Associates, Mr. Dorr directs us to SKA's fraudulent conveyance complaints and subsequent amendments which were attached to his district court brief addressing the set off issue. He asserts that the documents show that SKA believed that its fraudulent conveyance claims were inseparable from the claims which led to the monetary award. While there are aspects of the complaints that could possibly be interpreted as Mr. Dorr advocates, we are not convinced the complaint allegations necessarily tie the fraudulent conveyance action to the monetary award. Instead, the documents seem to include broad, general allegations about the arbitration award. [¶ 28] The judgment at issue here covered the monetary portion of the arbitration order awarding damages to SKA for unpaid compensation and violation of the dissolution provisions of the partnership agreement. Mr. Dorr has not directed us to any evidence showing that the fraudulent conveyance action was specifically directed at recovering for the claims covered by the monetary judgment. The district court concluded that Mr. Dorr did not meet his burden of proving the requisite connection between the settlements and the monetary judgment; rather, the evidence showed that the fraudulent conveyance settlements pertained to the portions of the arbitration award not included in the $105,163.78 monetary judgment. [¶ 29] Mr. Dorr did not provide us with a transcript of the evidentiary hearing, so we do not know what evidence was actually presented on his set off claims. Accordingly, we must assume that the evidence presented at the hearing supported the district court's factual findings. See Askvig v. Wells Fargo Bank Wyoming, N.A., 2005 WY 138, ¶ 21 n. 5, 121 P.3d 783, 789 n. 5 (Wyo.2005). Taking the district court's factual findings as true, we agree that Mr. Dorr did not satisfy his burden of proving that the settlements were related to the monetary judgment. The district court did not abuse its discretion by refusing to credit the Bill Dorr and First Interstate Bank settlements against SKA's judgment. [¶ 30] Affirmed.