Court Opinion

ID: 901766
Source: CourtListenerOpinion
Date Created: 2013-06-13 00:59:18.604046+00
Date Added: 2024-06-11T09:06:30.681502
License: Public Domain

#24676-rev-PER CURIAM
2008 SD 37

                          IN THE SUPREME COURT
                                  OF THE
                         STATE OF SOUTH DAKOTA

                                * * * *

FIRST NATIONAL BANK OF OMAHA,             Plaintiff and Appellant,

      v.

ALLEN KOLUCEK,                            Defendant.

                                * * * *

                   APPEAL FROM THE CIRCUIT COURT
                    OF THE FIRST JUDICIAL CIRCUIT
                  BON HOMME COUNTY, SOUTH DAKOTA

                                * * * *

                         HONORABLE GLEN W. ENG
                                Judge

                                * * * *

LISA LAUINGER of
Johnson, Rodenburg & Lauinger             Attorneys for plaintiff
Bismarck, North Dakota                    and appellant.

ALLEN KOLUCEK                             Pro se defendant.
Scotland, South Dakota
                                * * * *

                                          CONSIDERED ON BRIEFS
                                          MAY 19, 2008

                                          OPINION FILED 5/28/08
#24676

PER CURIAM

[¶1.]         First National Bank of Omaha (First National) appeals the circuit

court's denial of a motion to compel answers to post-judgment interrogatories. We

reverse.

                                  BACKGROUND

[¶2.]         First National obtained a default judgment against Allen Kolucek for

past due credit card debt. A summons and complaint were personally served upon

Kolucek and he made no appearance in this matter. Judgment in the amount of

$6,449.93 was entered on March 31, 2006. First National then sent Kolucek

"Interrogatories Pursuant to Rule 69" seeking financial information to aid in

recovering the judgment amount. No response was received. First National then

served and filed a motion with the circuit court seeking an order to compel Kolucek

to answer the post-judgment interrogatories.

[¶3.]         Following a hearing, the circuit court denied the motion to compel

reasoning that First National was improperly proceeding under SDCL 15-6-69

(execution)(Rule 69) and should instead be proceeding under SDCL ch 15-20

(proceedings supplementary to execution) in order to seek information in aid of

execution of judgment. The circuit court also found that the Rule 69 interrogatories

were not properly served because they were sent by first class mail and required

any future requests be sent by certified mail with return receipt. First National

appeals. 1

1.      Kolucek has not entered an appearance or contested the appeal.

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                                        ISSUE

[¶4.]      Whether the circuit court erred in denying First National's
motion to compel answers to post-judgment interrogatories.

        A. Whether First National was entitled to post-judgment discovery under
           SDCL 15-6-69.

[¶5.]         First National relied upon SDCL 15-6-69 in submitting these

interrogatories to aid in the execution of the judgment. That rule provides:

              Process to enforce a judgment for the payment of money
              shall be a writ of execution, unless the court directs
              otherwise. The procedure on execution in proceedings
              supplementary to and in aid of a judgment, and in
              proceedings on and in aid of execution shall be in
              accordance with applicable statute or rule. In aid of a
              judgment or execution, the judgment creditor, or his
              successor in interest when that interest appears of record,
              may obtain discovery from any person, including the
              judgment debtor in the manner provided in these rules.

SDCL 15-6-69 (emphasis added). Although this Court has not had occasion to

address this rule, the relevant portion as highlighted above closely tracks Federal

Rule of Civil Procedure 69. Fed.R.Civ.P. 69(a)(2). In addressing the federal

counterpart to the rule, leading commentators have recognized that the intent of

the rule is that "[t]he judgment creditor is allowed discovery to find out about assets

on which execution can issue or about assets that have been fraudulently

transferred or are otherwise beyond the reach of execution." 12 Wright & Miller,

Federal Practice and Procedure, § 3014 (2nd ed 1997). To accomplish this purpose,

the judgment creditor may use any of the discovery devices provided in the civil

rules to aid in the execution. Id. See also 13 James Wm. Moore et al., Moore's

Federal Practice, ch 69.04[3] (3rd ed 2007). SDCL 15-6-26(a) specifically provides for

discovery by written interrogatories.

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[¶6.]         In comparison, SDCL ch 15-20 (proceedings supplementary to

execution) provides for an examination of a debtor after execution has occurred, but

the judgment remains unsatisfied. See SDCL 15-20-1. 2 In addressing the

interrelationship between these provisions in a similar situation, the Minnesota

Court of Appeals found:

              Appellant's argument regarding the exclusivity of [the
              examination of debtor provisions similar to SDCL ch 15-
              20] is not sound. A plain reading of Rule 69 shows that
              the judgment creditor may obtain discovery from any
              person in the manner provided in the rules, "in aid of
              judgment or execution." Here, respondent attempted to
              use discovery in aid of judgment. One need not wait until
              the writ of execution is returned unsatisfied to utilize
              discovery.

Anchor Gas, Inc. v. Border Black Top, Inc., 381 NW2d 96, 98 (MinCtApp 1986).

Therefore, the court affirmed the lower court's decision allowing post-judgment

discovery under Rule 69 to aid in execution of judgment. This same determination

was reached by the North Dakota Supreme Court in Mid-Dakota Clinic, P.C. v.

Kolsrud, 603 NW2d 475, 476-78 (ND 1999). In that case, the court recognized that

Rule 69 provides "a practical and inexpensive means for both the judgment creditor

and debtor of discovering the assets of a judgment debtor." Id. at 478. Further, the

examination of debtor provisions similar to SDCL ch 15-20 require first an

2.      SDCL 15-20-1 provides:

              When an execution upon a judgment for twenty-five
              dollars or more . . . is returned unsatisfied in whole or in
              part, the judgment creditor at any time after such return
              is entitled to an order from a judge of the circuit court
              within the county to which the execution was issued,
              requiring such judgment debtor to appear and answer
              concerning his property before such judge, within such
              county, at a time and place specified in the order.
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unsatisfied execution, whereas Rule 69 discovery is utilized prior to execution. Id.

at 477-78. The North Dakota Supreme Court also found that public policy favored

"allowing judgment creditors to proceed with post-judgment discovery without first

issuing an execution on a debtor's property." Id. at 477. The court held that an

"order compelling answers was a valid exercise of the trial court's authority under

Rule 37, because Rule 69 allows post-judgment discovery prior to the issuance of an

execution." Id. at 480.

[¶7.]         Here, the circuit court erred as a matter of law in determining First

National was required to proceed exclusively under SDCL ch 15-20 rather than

utilizing SDCL 15-6-69, and incorrectly determined that it had no authority to

compel answers to the Rule 69 interrogatories under SDCL 15-6-37(a) (motion for

order compelling discovery).

        B. Whether the request for post-judgment interrogatories was properly served.

[¶8.]         Alternatively, the circuit court found that the Rule 69 interrogatories

were not properly served because they were sent by first class mail. Instead, the

circuit court imposed a requirement that they be served by certified mail with

return receipt. In addressing proper service of post-judgment interrogatories, the

North Dakota Supreme Court recognized that the Rule 5 service requirements

applied because "discovery documents do not begin a separate action, but merely aid

the judgment. Thus, [judgment creditor's] Rule 5 service by mail to [debtor's] last

known address was sufficient." Mid-Dakota Clinic, P.C., 603 NW2d at 479.

Similarly, SDCL 15-6-5(b) provides that for every pleading subsequent to the

original complaint, service "shall be made by delivering a copy to him or by mailing

it to him at his last known address." In addition, "[s]ervice by mail shall be by first
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class mail and is complete upon mailing." Id. Consequently, service of the Rule 69

interrogatories was properly effectuated by first class mail. 3

[¶9.]          Reversed.

[¶10.]         GILBERTSON, Chief Justice, SABERS, KONENKAMP, ZINTER and

MEIERHENRY, Justices, participating.

3.       It is significant to note that the North Dakota Supreme Court also recognized
         that an order to show cause directing a debtor to appear and explain why he
         should not be held in contempt for failing to answer such interrogatories
         required Rule 4 service. Mid-Dakota Clinic, P.C., 603 NW2d at 479. This is
         consistent with SDCL 15-6-5(b) which provides that its provisions do not
         apply "to the service of . . . any paper to bring a party into contempt." See
         Matter of Gillespi, 397 NW2d 476, 477-78 (SD 1986) (holding service under
         SDCL 15-6-4 is mandatory in order for the circuit court to acquire jurisdiction
         in contempt proceedings). While this is not applicable at this point, it may
         become so in the future.
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