Court Opinion

ID: 9555258
Source: CourtListenerOpinion
Date Created: 2023-08-11 14:09:59.524894+00
Date Added: 2024-06-11T15:42:02.302877
License: Public Domain

RENDERED: AUGUST 4, 2023; 10:00 A.M.
                            NOT TO BE PUBLISHED

                    Commonwealth of Kentucky
                               Court of Appeals
                                   NO. 2022-CA-1452-MR

DAVID PARTIDA                                                         APPELLANT

                    APPEAL FROM JEFFERSON CIRCUIT COURT
v.                   HONORABLE AUDRA J. ECKERLE, JUDGE
                            ACTION NO. 22-CI-003173

INSTANT AUTO CREDIT, INC.                                               APPELLEE

                                         OPINION
                                        AFFIRMING

                                        ** ** ** ** **

BEFORE: THOMPSON, CHIEF JUDGE; EASTON AND KAREM, JUDGES.

THOMPSON, CHIEF JUDGE: David Partida (“Appellant”) appeals from an order

of the Jefferson Circuit Court granting the motion of Instant Auto Credit, Inc. to

dismiss Appellant’s action. Appellant argues that Appellee violated the Kentucky

Consumer Protection Act1 (“KCPA”); improperly garnished Appellant’s assets

based on an incorrect amount of debt and interest rate; and, that Appellant’s action

1
    Kentucky Revised Statutes (“KRS”) 367.110 et seq.
is not precluded by a prior action filed by Appellee to collect a judgment. He seeks

an opinion reversing the order of the Jefferson Circuit Court, and remanding the

matter for further proceedings. After careful review, we affirm the order on

appeal.

                   FACTS AND PROCEDURAL HISTORY

            On December 7, 1996, Appellant co-signed a loan to purchase a 1991

Mazda B2200 truck from Tom Payette Auto Center in Louisville, Kentucky. The

loan was a retail installment contract with security agreement. Tom Payette Auto

Center assigned the loan to Appellee.

            Appellant and the other co-signers defaulted on the loan, and

allegedly moved from the Commonwealth and took the Mazda truck with them.

On February 8, 2000, Appellee filed an action in Jefferson Circuit Court (Case No.

00-CI-000912) to recover the balance of the loan. Because Appellant was no

longer in the Commonwealth, Appellee served the Kentucky Secretary of State.

That action resulted in a default judgment in favor of Appellee entered on June 1,

2000.

            Some 22 years later, Appellee filed a non-wage garnishment with the

Jefferson Circuit Court Clerk. The Clerk issued the garnishment, which Appellee

then served on Appellant’s bank. The default judgment in Case No. 00-CI-000912

awarded Appellee the sum of $5,524.08 plus interest at the contract rate of 25.75%

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per annum from February 25, 1998. According to Appellee, the garnishment

represented the debt with accrued interest in the amount of $79,475.02 plus interest

at the rate of 12% per annum from April 21, 2022. The garnishment resulted in

Appellee recovering $15,753.88 of the amount owed.

            On May 9, 2022, Appellant filed a motion in Case No. 00-CI-000912

to quash the garnishment. In support of the motion, Appellant cited KRS Chapter

425 and related case law for the proposition that Appellee grossly misstated or

otherwise miscalculated the balance due. On July 8, 2022, the circuit court entered

an order denying Appellant’s motion to quash the garnishment. Thereafter,

Appellant appealed to this Court the denial of his motion to quash. That appeal,

designated 2022-CA-0880-MR, is now pending before another panel of this Court.

            On June 22, 2022, Appellant filed a complaint in Jefferson Circuit

Court against Appellee alleging a violation of the KCPA, to wit, that Appellee

applied the wrong interest rate to the underlying default judgment, and/or

otherwise miscalculated the amount of the garnishment. The focus of his

complaint was that Appellee sought to garnish an incorrect amount from Appellant

in violation of the KCPA.

            On July 15, 2022, Appellee filed a motion to dismiss Appellant’s

complaint as duplicative of Case No. 00-CI-000912. On December 1, 2022, and

after considering the memoranda and arguments of counsel, the Jefferson Circuit

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Court entered an order dismissing the instant action per Kentucky Rules of Civil

Procedure (“CR”) 12.02. This appeal followed.

                            STANDARD OF REVIEW

             A CR 12.02 motion to dismiss is a pure question of law; therefore, an

appellate court reviews the issue de novo. Fox v. Grayson, 317 S.W.3d 1, 7 (Ky.

2010).

                         ARGUMENTS AND ANALYSIS

             Appellant now argues that the Jefferson Circuit Court erred in

dismissing Appellant’s action for failure to state a claim upon which relief may be

granted. Appellant argues that Appellee violated the KCPA; improperly garnished

Appellant’s assets based on an incorrect amount of debt and interest rate; and, that

Appellant’s action is not precluded by Case No. 00-CI-000912. Appellant directs

our attention to various provisions of the KCPA, the purpose of which Appellant

asserts is to deter conduct resulting in unfair trade practices which perpetrate a

fraud and deception upon the public. Appellant argues that the question of whether

Appellee violated the KCPA is a question of fact properly decided by a jury. He

also points to the garnishment provisions of KRS 425.501(1), and goes on to argue

that the theory of “claim preclusion” does not operate to bar the instant action

because there is no similarity of the causes of action and there was no decision on

the merits in Case No. 00-CI-000912. In sum, Appellant asserts that the Jefferson

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Circuit Court erred in dismissing the instant action. He requests an opinion

reversing the order on appeal and remanding the matter to the circuit court.

             The question for our consideration is whether the Jefferson Circuit

Court properly dismissed Appellant’s action for failure to state a claim upon which

relief may be granted per CR 12.02(f). Though the order on appeal does not

address the basis for the dismissal, the record demonstrates that the circuit court

was persuaded by Appellee’s memorandum and arguments that the instant action is

duplicative of the arguments raised in Case No. 00-CI-000912. The circuit court

accepted Appellee’s argument that the denial of Appellant’s motion to quash the

garnishment in Case No. 00-CI-000912 renders the matter res judicata.

             [T]he doctrine of res judicata operates to preclude
             repetitious actions. In order to apply res judicata, there
             must be 1) identity of the parties between the two actions,
             2) identity of the two causes of action, and 3) the prior
             action must have been decided on its merits. Claim
             preclusion, a subpart of res judicata, bars a party from re-
             litigating a previously adjudicated cause of action and
             entirely bars a new lawsuit on the same cause of action.
             In short, the rule of res judicata does not act as a bar if
             there are different issues or the questions of law
             presented are different.

Harrod v. Irvine, 283 S.W.3d 246, 250 (Ky. App. 2009), as modified (May 8,

2009) (internal quotation marks and citations omitted).

                    The parties are identical in Case No. 00-CI-000912 and the

instant action. This satisfies the first element of Harrod. Both actions center on

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the same facts, i.e., Appellant’s default of the underlying promissory note, the

default judgment, Appellee’s years-long effort to recover the sums owed, and the

eventual garnishment. The arguments asserted in Appellant’s motion to quash the

garnishment in Case No. 00-CI-000912 mirror the arguments in the instant action.

In both cases, Appellant argues that Appellee grossly miscalculated the sum owed

and asserts that the garnishment is improper. The two causes of action are the

same. Though Appellant asserts that his KCPA claim is novel and unrelated to the

arguments raised in Case No. 00-CI-000912, this argument is merely a

reformulation of Appellant’s argument in the prior proceeding that Appellee

grossly and improperly miscalculated the amount of the debt. This satisfies the

second element of Harrod, i.e., that there exists identity of two causes of action.

Appellant could have raised the KCPA claim in Case No. 00-CI-000912, but did

not.

             When the circuit court denied Appellant’s motion to quash the

garnishment in Case No. 00-CI-000912, it rejected Appellant’s argument that the

amount of the garnishment was improper. This gives the matter finality and

satisfies the third element of Harrod.

                                  CONCLUSION

             By bringing two simultaneous appeals in two actions involving the

same parties, the same facts, and the same or similar arguments, Appellant is

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improperly prosecuting duplicative actions and seeking “two bites of the apple.”

Appellant unsuccessfully attempted to quash the garnishment in Case No. 00-CI-

000912, and the appeal in that proceeding is now before another panel of this

Court. Appellant may not bring another action hoping for a different result. This

is one of many reasons why the theory of claim preclusion “bars a party from re-

litigating a previously adjudicated cause of action and entirely bars a new lawsuit

on the same cause of action.” Harrod, 283 S.W.3d at 250 (citation omitted).

             Finally, if the matter is remanded to the circuit court in No. 2022-CA-

0880-MR, Appellant may be entitled, with leave of the circuit court, to file a

supplemental pleading per CR 15.04 asserting the KCPA claim. Both parties must

be given the opportunity to assert contentions about the consequences of any error

in interest calculation, which includes the Default Judgment as entered. They may

do so by amended or supplemental pleadings on remand in Case No. 00-CI-

000912. This opinion should not be construed as foreclosing Appellant from

raising a KCPA claim on remand.

             For these reasons, we affirm the order of the Jefferson Circuit Court.

             ALL CONCUR.

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BRIEFS FOR APPELLANT:    BRIEF FOR APPELLEE:

James H. Lawson          Darryl W. Durham
Shelbyville, Kentucky    Michael R. Gosnell
                         Louisville, Kentucky

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