EXCEL ENERGY, INC. v. COMMONWEALTH INSTITUTIONAL SECURITIES, INC.; R. GENE SMITH; GEORGE LAWSON; AND GERALD B. BRENZEL and R. GENE SMITH v. GEORGE LAWSON
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RENDERED: February 26, 1999; 10:00 a.m.
TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1998-CA-002975-MR
EXCEL ENERGY, INC.
APPELLANT
APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE JOHN WOODS POTTER, JUDGE
ACTION NO. 95-CI-001090
v.
COMMONWEALTH INSTITUTIONAL SECURITIES, INC.;
R. GENE SMITH; GEORGE LAWSON; AND
GERALD B. BRENZEL
AND
NO.
1998-CA-003030-MR
R. GENE SMITH
v.
APPELLEES
CROSS-APPELLANT
CROSS-APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE JOHN WOODS POTTER, JUDGE
ACTION NO. 95-CI-001090
GEORGE LAWSON
CROSS-APPELLEE
OPINION AND ORDER
DISMISSING APPEAL NO. 1998-CA-002975-MR
* * * * * * * * * * * *
BEFORE:
DYCHE, GUIDUGLI, AND McANULTY, JUDGES.
DYCHE, JUDGE.
The Court has considered the motion of appellant,
Excel Energy, Inc. (hereinafter “Excel”), for timely filing of
appeal No. 1998-CA-002975-MR, the motion of appellee, R. Gene
Smith (hereinafter “Smith”), to dismiss the appeal, and the
response to each motion.
The Court, being sufficiently advised,
ORDERS the motion for timely filing of appeal be DENIED.
The
motion to dismiss appeal is GRANTED.
The notice of appeal designates an order entered March
25, 1998, and an order entered October 30, 1998.
October 30, 1998, includes CR 54.02 language.
The order of
Pursuant to CR
73.02(1)(a), a notice of appeal must be filed within thirty (30)
days after the date of notation of service of the decision
appealed from.
The Jefferson Circuit Clerk's docket shows that
the notation was made on October 30, 1998.
Therefore, the last
day on which a timely notice of appeal could have been filed was
November 30, 1998 (November 29 was a Sunday).
The docket shows
the notice of appeal was filed on December 1, 1998.
Excel moves this Court to declare that the notice of
appeal was timely filed on November 30, 1998.
Excel states that
the notice of appeal was "file-stamped" on that day through the
use of a stamp machine.
The notice of appeal was not accompanied
by the filing fee, which was eventually paid on December 1, 1998,
the date on which the circuit clerk recorded the notice of appeal
as filed.
It is Excel's contention that the fact the notice of
appeal was not entered on the docket by the clerk on November 30,
1998, is irrelevant for purposes of compliance with the Civil
Rules and that its notice of appeal was timely filed.
Excel
relies on Foxworthy v. Norstam Veneers, Inc., Ky., 816 S.W.2d 907
(1991).
Smith disagrees with Excel’s interpretation of
Foxworthy and points out that, while the case stands for the
principle that the policy of substantial compliance may be
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applied to the failure to timely pay the filing fee, it did not
do away with "the cardinal rule" that the failure to timely file
the notice of appeal is fatal to an appeal.
Therefore, Smith
rejects Excel's contention that the notice of appeal was timely
filed by having it "clocked and dropped" near the close of
business on November 30, 1998, without the filing fee.
CR 73.02 controls the disposition of this matter.
The
pertinent portions of that Rule are as follows:
(1)(a) The notice of appeal shall be filed
within 30 days after the date of notation of
service of the judgment or order under Rule
77.04(2).
(b) If an appeal or cross-appeal is from an
order or judgment of the circuit court, the
filing fee required by Rule 76.42(2)(a)(i) or
(ii) shall be paid to the clerk of the
circuit court at the time the notice of
appeal or cross-appeal is filed, and the
notice shall not be docketed or noted as
filed until such payment is made.
. . . .
(2) The failure of a party to file timely a
notice of appeal, cross-appeal, or motion for
discretionary review shall result in a
dismissal or denial. Failure to comply with
other rules relating to appeals or motions
for discretionary review does not affect the
validity of the appeal or motion, but is
ground for such action as the appellate court
deems appropriate, which may include:
(a) A dismissal of the appeal or denial of
the motion for discretionary review, . . .
(Emphasis added.)
Both Excel and Smith refer to the case of Manly v.
Manly, Ky., 669 S.W.2d 537 (1984).
The issue in that case, which
presented a factual situation somewhat similar to the one
involved herein, was whether the payment of the filing fee is a
condition precedent to the filing of the notice of appeal.
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Manly
answered that question in the affirmative and squarely based its
outcome upon the provisions of CR 73.02(1)(a) and CR 73.02(1)(b),
which have essentially remained the same to this date.
The
Kentucky Supreme Court stated:
The filing of the Notice of Appeal in this
case was not timely because, under the Rules,
it could not be filed until the filing fee
was paid. The Notice was not filed on the
30th day as indicated by the stamp placed on
the Notice by the clerk’s office. The stamp
indicating it was filed on that date is
nullity because the clerk had no authority to
file the notice, pursuant to CR 73.02(1)(a)
until he had collected the filing fee. The
filing fee was paid on the 32nd day after
entry of Judgment, and the Notice of Appeal
was actually filed on that date. It was not
timely filed.
Manly at 540.
In Manly, the Supreme Court maintained its mandate of
strict compliance with the time limitation for filing a notice of
appeal and observed that relief from that policy would require an
amendment of the Rule.
The “Rule” which the Supreme Court
referred to in that case unquestionably is CR 73.02(1)(a)-(b).
In 1985, an amendment to CR 73.02 became effective.
However, it pertained to CR 73.02(2), not to CR 73.02(1)(a) or CR
73.02(1)(b).
The amendment introduced the concept of substantial
compliance with those rules relating to appeals other than those
which control the time requirement for filing a notice of appeal,
to which strict compliance continues to be applied.
The Supreme
Court relied on that amendment in Foxworthy to hold that the
failure to pay the filing fee for the notice of appeal is not
automatically fatal or jurisdictional.
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In Foxworthy, the notice of appeal was timely mailed to
the Jefferson Circuit Court without the filing fee.
It was then
not only stamped received but also actually entered on the docket
as filed.
The deficiency was promptly corrected by counsel for
appellant, but not until after expiration of the 30 days provided
for in CR 73.02(1)(a).
The Supreme Court stated:
The question is what happens when, despite
the language in CR 73.02(1)(b) directing the
filing fee shall be “paid to the clerk of the
circuit court at the time the Notice of
Appeal . . . is filed, and the notice shall
not be docketed or noted as filed until such
payment is made,” nevertheless, through
inadvertence, the filing fee is not paid in
advance, the clerk files the Notice of Appeal
anyway, and then the filing fee is paid after
the 30 day period for filing a Notice of
Appeal has elapsed.
Foxworthy at 908.
It is clear to this Court that the application of the
concept of substantial compliance, as incorporated in CR
73.02(2), to the late payment of the filing fee in Foxworthy is
entirely based upon the distinct circumstances of that case, and
that Foxworthy does not establish that the time when the filing
fee is paid has lost relevancy under any set of facts.
In
Foxworthy, there would have been ample time left to correct the
deficiency in a timely fashion were it not for the error made by
the circuit clerk of filing the notice of appeal in violation of
CR 73.02(1)(b), thereby allowing the appellant to rely on the
mistaken belief that it had strictly complied with CR 73.02(1)(a)
until after its time frame had expired.
These are not the facts of the case sub judice.
The
notice of appeal was dropped at the clerk’s office without the
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filing fee on the very last day that it could have been filed.
It was not filed on that day and could not have been filed, due
to the operation of CR 73.02(1)(b).
Contrary to Excel’s
contention, that is the key factor to resolve this controversy.
Foxworthy merely established that the failure to pay the filing
fee is no longer automatically fatal to an appeal.
It did not
alter the requirement that the notice of appeal be timely filed
and, thus, did not eliminate the possibility that, in some cases,
the failure to timely pay the filing fee could result in an
untimely filing of the notice of appeal.
Unfortunately, this is
one of those cases and we have to conclude that Excel’s failure
to timely pay the filing fee cannot be cured and is fatal to its
appeal.
Based on the foregoing, it is ORDERED that appeal No.
1998-CA-002975-MR be DISMISSED.
The notice of cross-appeal was
timely filed on December 9, 1998, and, therefore, the crossappeal shall proceed.
ALL CONCUR.
ENTERED: February 26, 1999
/s/ R. W. Dyche
JUDGE, COURT OF APPEALS
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COUNSEL FOR APPELLANT:
COUNSEL FOR APPELLEE,
R. GENE SMITH:
Donald L. Cox
William H. Mooney
Louisville, Kentucky
Janet Jakubiwicz
John K. Bush
Thomas E. Powell II
Louisville, Kentucky
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