PROVIDIAN NATIONAL BANK v. TIMOTHY WOODS
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RENDERED: MAY 13, 2005; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO. 2003-CA-000094-MR
PROVIDIAN NATIONAL BANK
APPELLANT
APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE GEOFFREY P. MORRIS, JUDGE
ACTION NO. 02-CI-001629
v.
TIMOTHY WOODS
APPELLEE
OPINION
REVERSING
** ** ** ** **
BEFORE:
BUCKINGHAM, JOHNSON, AND SCHRODER, JUDGES.
BUCKINGHAM, JUDGE:
Providian National Bank appeals from orders
of the Jefferson Circuit Court discharging Timothy Woods from
his obligations under an agreed judgment.
We reverse.
Woods formally began his relationship with the bank on
October 19, 2000, when he executed a credit card agreement with
the bank.
The bank issued Woods a credit card, and he incurred
charges on the account.
However, Woods did not fulfill his
payment obligations under the account agreement.
As a result,
the bank filed a breach of contract claim against him in the
Jefferson Circuit Court on March 4, 2002.
The court entered summary judgment in favor of the
bank on May 14, 2002.
On May 29, 2002, Woods and the bank
entered into an agreed judgment.
That judgment recognized
damages of $5,510.27 as principal, $255.64 as interest through
April 24, 2002, and costs.
The judgment further recognized an
interest rate of 19.99% in accordance with the terms of the
account agreement.
In addition to setting out the damages, the judgment
set out a payment plan for Woods.
Under the terms of the
judgment, Woods was required to pay $165 per month, due on the
25th of each month, until the judgment was paid.
In return, the
bank agreed not to seek execution on the judgment so long as
Woods complied with the payment plan.
In the event Woods failed
to meet his obligations under the payment schedule, the bank had
the right to execute on the judgment without further court
action.
Woods made timely payments in May and June of 2002.
However, he was late with his July payment and made no payment
during August.
The bank concedes that Woods made a double
payment in September, thus bringing the amount due current.
However, since Woods had twice failed to comply with the payment
schedule, the bank elected to execute on the judgment.
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On
October 23, 2002, the bank sought and obtained garnishment on a
bank account maintained by Woods.
On November 6, 2002, Woods filed a motion seeking
relief from further obligations under the agreed judgment.
Further, he asked the court to direct the bank to take steps
necessary to release the garnishment on his bank account.
In an
affidavit in support of his motion, Woods stated that at the
time the bank sought the garnishment he had fully paid the
amounts due under the agreement.
Neither his affidavit nor his
motion made mention of the fact that he had twice failed to meet
the payment schedule.
The bank failed to appear for the hearing on Woods’s
motion, and the motion was granted by the court in an order
entered on September 10, 2002.
The bank filed a motion seeking
to vacate the order under CR1 59.05 and CR 60.02.
The court
denied the motion, and the bank filed this appeal.
Woods did not file an appellee’s brief.2
When “the
appellee’s brief has not been filed within the time allowed, the
court may: (i) accept the appellant’s statement of the facts and
issues as correct; (ii) reverse the judgment if appellant’s
1
Kentucky Rules of Civil Procedure.
2
Woods was represented by an attorney before the circuit court, but his
attorney was granted leave to withdraw by this court after the bank filed its
appeal. The order allowing Woods’s attorney to withdraw gave Woods 30 days
to obtain new counsel. Further, the order stated that Woods would be
proceeding pro se should he fail to retain new counsel to represent him.
-3-
brief reasonably appears to sustain such action; or (iii) regard
the appellee’s failure as a confession of error and reverse the
judgment without considering the merits of the case.”
76.12(8)(c).
CR
Because the bank is entitled to relief based on
the merits of their arguments, we will address the case in that
manner rather than penalize Woods for not filing a brief.
In Woods’s motion to be relieved from his obligations
under the agreed judgment, he alleged that the bank breached the
terms of the judgment when it garnished his bank account even
though he was current in his payments.
Although a judgment may
be collaterally attacked under CR 60.02 (see Cumberland Falls
Chair Lift, Inc. v. Commonwealth, 536 S.W.2d 316 (Ky. 1976)),
Woods’s motion made no reference to CR 60.02 or to any grounds
for relief thereunder.
Nevertheless, the court ordered that
Woods be discharged from any further obligations under the
agreed judgment and that the bank release the garnishment on the
bank account.
The effect of the court’s order is unclear.
It could
be interpreted to mean that the court relieved Woods of all
obligations under the judgment, meaning that he did not owe any
money to the bank despite the fact that it had been awarded
summary judgment earlier in the case.
Alternatively, the
court’s order could be interpreted to mean that Woods was no
longer required to make the monthly payment to satisfy the
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judgment.
If that were the case, the bank would still have been
entitled to execute on the judgment.
Regardless, we conclude
that it was error for the court to relieve Woods of his
obligations under the agreed judgment and to order the bank to
lift the garnishment.
“A party who commits the first breach of a contract is
deprived of the right to complain of a subsequent breach by the
other party.”
Fay E. Sams Money Purchase Pension Plan v.
Jansen, 3 S.W.3d 753, 759 (Ky.App. 1999).
See also Blue Diamond
Coal Co. v. Robertson, 235 Ky. 425, 31 S.W.2d 701, 703 (1930).3
Woods was late with his July payment and missed his August
payment.
Therefore, he breached the terms of the agreed
judgment, and the bank was within its rights under the judgment
to execute on the bank account.4
Woods cited no authority to the court, other than the
Jansen and Blue Diamond cases, to support his argument that he
was entitled to relief from the judgment.
Those cases do not
support his argument but support the bank’s argument because
3
These two cases deal with breach of contract rather than breach of the terms
of an agreed judgment. However, Black’s Law Dictionary 842 (6th ed. 1990)
defines an agreed judgment as “[a] judgment entered on agreement of the
parties, which receives the sanction of the court, and it constitutes a
contract between the parties to the agreement[.]”
4
Although Woods had no right to complain of a breach of the terms of the
agreed judgment by Providian since he committed the first breach, we do not
hold that Providian committed a subsequent breach. Rather, as we have noted,
Providian was within its rights to execute on the bank account once Woods
breached the terms of the agreed judgment.
-5-
Woods committed the first breach of the contract.
We know of no
authority, nor did Woods cite any, that would give him relief
from his obligations under the judgment.
The order of the Jefferson Circuit Court is reversed.
ALL CONCUR.
BRIEF FOR APPELLANT:
NO BRIEF FILED FOR APPELLEE
Paul Croushore
Cincinnati, Ohio
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