C; NORWEST BANK MINNESOTA, N .A . V. DARREL HURLEY
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RENDERED : APRIL 24, 2003
AS MODIFIED : MAY 14, 2003
TO BE PUBLISHED
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2002-SC-0055-DG
NORWEST BANK MINNESOTA, N .A.
DD Ln1 U ~ ;PE"AN
C;
ON REVIEW FROM COURT OF APPEALS
2000-CA-0995-MR
LAUREL CIRCUIT COURT NO. 1999-CI-0704
V.
APPELLEE
DARREL HURLEY
OPINION OF THE COURT BY JUSTICE JOHNSTONE
REVERSING AND REMANDING
The Court of Appeals dismissed Appellant's appeal on grounds that it was not
timely filed . We granted discretionary review and reverse .
I.
Facts and Procedural History
Appellant, Nonwest Bank Minnesota, N .A., instituted a foreclosure action against
Appellee, Darrel Hurley, on September 9, 1999. Hurley answered with a general denial
on October 5, 1999. A few days later, Hurley served interrogatories and requests for
production of documents on Norwest's counsel . After two months without a response to
his discovery requests, Hurley moved the trial court for an order to compel discovery .
Both parties appeared at the hearing on the motion, which was held on January 14,
2000. At the conclusion of the hearing, the trial court ordered Norwest to produce
answers to the outstanding discovery requests within ten (10) days .
After Norwest failed to comply with the court's ten-day deadline, Hurley moved
the trial court to dismiss the action against him with prejudice. The motion was noticed
for March 10, 2000. Norwest did not appear at the hearing . By written order entered on
March 21, 2000, the trial court granted Hurley's motion and awarded him $750.00 in
attorney's fees .
Norwest filed a notice of appeal on April 20, 2000, from "the Court's decision of
March 10, 2000, whereby the Court overruled [Hurley's] motion to dismiss." The Court
of Appeals concluded that the notice was in error. "Obviously, [Norwest] intended to
appeal from the March 21, 2000, order granting [Hurley's] motion to dismiss." Slip op.
a t 3 . Because the March 21 order was the only final and appealable order, the Court of
Appeals concluded that "the doctrine of substantial compliance saves [Norwest] from
dismissal despite the erroneous designation and date in the notice ." Id . at 4. But in
addition to stating the wrong order and date in the notice of appeal, Norwest's counsel
failed to sign the check that Norwest tendered as payment for filing the notice.
When the circuit court clerk received Norwest's notice of appeal and the
unsigned check, the clerk phoned Norwest's counsel and alerted him that the check was
unsigned and that it was being returned to him for proper signature . Nonetheless, the
clerk assured Norwest's counsel that the notice of appeal would be filed . And the clerk
did in fact note on the docket that the notice was filed on the day it was received, April
20 . The circuit clerk received the signed check on May 9, and noted on the docket that
the notice of appeal was paid on the same day. The Court of Appeals concluded that
the clerk violated CR 73.02(1) by filing Norwest's notice of appeal, because payment
was not made timely, i .e . , the docket sheet reflects that payment was made on May 9,
which was beyond the thirty- (30) day limit set forth in CR 73.02(1) . It then held, under
our decision in Excel Energy, Inc . v. Commonwealth Institutional Securities, Inc . , Ky., 37
S .W .3d 713 (2001), that Norwest's Notice of Appeal was untimely and dismissed the
appeal . We disagree and reverse .
II .
Discussion
CR 73.02(1) states in pertinent part:
If an appeal or cross-appeal is from an order or judgment of
the circuit court, the filing fee required . . . shall be paid to
the clerk of the circuit court at the time the notice of appeal
or cross-appeal is tendered, and the notice shall not be
docketed or noted as filed until such payment is made . . . .
Two of our cases interpreting this rule, Foxworthy v. Veneers , Ky., 816 S .W .2d
907 (1991), and Excel Energy , supra, are important to the discussion of this case.
In Foxworthy , the appellant mailed a notice of appeal to the Jefferson Circuit
Court Clerk's office, but failed to include the required payment for filing the notice .
Foxworthy , 816 S.W.2d at 908. When the notice was received, the clerk's office
"compounded counsel's mistake by filing the Notice of Appeal rather than returning it."
Id . The failure to remit payment was discovered by the appellee, who notified the circuit
court clerk's office. Id . In turn, the clerk's office notified the appellant, who promptly
forwarded payment to the clerk's office . But by then, the thirty-day time limit had
already expired . Id. Under these facts, we held that the failure to timely pay the filing
fee did not require automatic dismissal of the appeal. Id . at 910 .
In Excel Energy , the appellant--on the last day for filing a notice of appeal-brought a notice of appeal to the Jefferson Circuit Court Clerk's office, time stamped the
notice via a file stamp located in the office, and dropped the stamped notice in the office
in basket. Excel Energy, 37 S.W .3d at 715 . Unfortunately, the appellant failed to tender
payment for filing the notice . Id . The next day, the clerk notified counsel of the missing
payment and refused to note on the docket sheet that the notice had been filed until
payment was made . Id . The appellant immediately tendered a check for the filing fee
and the clerk promptly noted that the notice had been filed . Id. Because the notice was
filed one day late, we held that, as a matter of policy, the notice of appeal was not filed
timely and, therefore, was properly dismissed by the Court of Appeals. Id . at 717.
The different result reached in these two cases comes from the straightforward
application of CR 73 .02(2), which provides in pertinent part:
The failure of a party to file timely a notice of appeal . . . shall
result in dismissal or denial. Failure to comply with other
rules relating to appeals . . . does not affect the validity of the
appeal . . . . but is ground for such action as the appellate
court deems appropriate . . . .
In Foxworthy , the notice of appeal was timely filed, and dismissal was not mandated by
the rule. But in Excel Energy , the notice of appeal was not timely filed, and dismissal
was mandated by the rule.
In the case at bar, the Court of Appeals concluded that Foxworthy and Excel
Energy could not be construed consistently with each other:
With all due respect, we are of the opinion that Foxworthy
provides an unreasonable and unpredictable approach to the
problem that cannot be reconciled with Excel .
The Foxworthy approach to the filing fee problem
leaves compliance with CR 73.02 entirely to the whim of the
circuit clerk. Placing in the hands of clerks such
discretionary power over the timeliness of an appeal creates
the anomalous situation in which an appellant lucky enough
to file with a clerk who does not follow the rule is rewarded
with a timely-filed notice of appeal . The notice of appeal of
an appellant who files with a clerk adhering to the dictates of
CR 73.02 is automatically dismissed as untimely . Such an
approach simply cannot be squared with the policy analysis
set out in Excel. Furthermore, we cannot ignore the fact that
such unlimited discretion on the part of clerks exposes the
procedure for filing notices of appeal to potential bias and
abuse based upon counsel's acquaintance or relationship
with a clerk. We are therefore convinced that the more
predictable rule established in Excel is the only fair,
reasonable, and workable solution to compliance with CR
73 .02.
Slip op., at 6-7.
With all due respect to the Court of Appeals, its reasoning cannot be reconciled
with Foxworthy , Excel Energy, or the plain language of CR 73 .02.
In this case, the notice of appeal was filed timely. Automatic dismissal was not
required by Excel Energy or CR 73.02(2). Rather, the Court of Appeals had the
discretion to determine what sanctions were appropriate, if any, upon finding that
Norwest had violated the appellate rules. See CR 73.02(2) . This discretion is sufficient
to check the potential for abuse that concerned the Court of Appeals. But we stress that
there is absolutely no'basis in the record to support the Court of Appeals' implication
that circuit court clerks of this Commonwealth, or their deputies, are not faithful to their
sworn oaths to execute their duties "without favor, affection or partiality ." KRS
30A .020 . Therefore, we hold that automatic dismissal of Norwest's appeal was not
appropriate under either CR 73 .02 or Excel Energy.
In conclusion, we note that the Court of Appeals' holding that CR 73 .02 requires
automatic dismissal of Norwest's appeal, assumes that Norwest's counsel's tender of an
unsigned check was not a "payment" within the meaning of CR 73.02 . As this is not an
issue on appeal, we do not address it here . Nonetheless, we emphasize that we are far
from convinced that this assumption is correct . See Dubost v. U.S . Patent and
Trademark Office , 777 F.2d 1561, 1566 (Fed . Cir. 1985) (Commissioner of Patents and
Trademarks could file, provisionally on the date it was received, a patent application that
was accompanied by an unsigned check as payment for the filing fee.).
For the reasons set forth above, we reverse the decision of the Court of Appeals
and remand this case for a decision on the merits .
Cooper, Keller, Stumbo, and Wintersheimer, JJ ., concur. Lambert, CJ, concurs
by separate opinion, with Graves, J ., joining that concurring opinion.
COUNSEL FOR APPELLANT :
Brian E . Chapman
Weltman Weinberg & Reis Co ., LPA
525 Vine Street, Suite 800
Cincinnati, OH 45202
COUNSEL FOR APPELLEE :
E . Liddell Vaughn
Hargadon Lenihan Harbolt & Herrington, PLLC
713 W. Main Street
Louisville, KY 40202
RENDERED : APRIL 24, 2003
TO BE PUBLISHED
,,iuyrrmr (~vurf of `rnfurhV
'~t
2002-SC-0055-DG
NORWEST BANK MINNESOTA, N.A.
APPELLANT
ON APPEAL FROM THE COURT OF APPEALS
2000-CA-0995-MR
LAUREL CIRCUIT COURT NO . 1999-CI-00704
V.
DARREL HURLEY
APPELLEE
CONCURRING OPINION BY CHIEF JUSTICE LAMBERT
I concur with the majority but express the view that the only distinction
between our decisions in Excel Energy, Inc. v. Commonwealth Institutional Securities,
Inc. ' and Foxworthy v. Norstam Veneers, Inc.2 is the response of the clerk to the flawed
tender of the notice of appeal and filing fee . The Court of Appeals summed it up as
follows:
The Foxworthy approach to the filing fee problem leaves
compliance with CR 73.02 entirely to the whim of the circuit
clerk. Placing in the hands of clerks such discretionary
power over the timeliness of an appeal creates the
anomalous situation in which an appellant lucky enough to
file with a clerk who does not follow the rule is rewarded with
a timely filed notice of appeal . s
' Ky., 37 S.W .3d 713 (2001) .
2 Ky., 816 S.W.2d 907 (1991) .
3 Slip op. at 7.
This case does nothing to resolve the conflict . It merely perpetuates a system in which
parties who obtain a filing stamp get one result, and those who do not get another result
despite overwhelming similarity of circumstances .
The circumstances presented in all three cases ( Foxworthy, Excel , and
the present case) are the same . The appealing party timely tendered a notice of appeal
but failed to attach proper payment of the filing fee . It is well-settled that payment of the
filing fee is not jurisdictional, and the failure of a party to attach proper payment should
not be fatal due to the doctrine of substantial compliance.
The doctrine of substantial compliance was instituted to prevent parties
from forfeiting their constitutional right of appeal for insubstantial reasons . As stated in
Foxworthy automatic dismissal of an appeal because the filing fee was not properly
attached to the notice "qualifies as a Draconian measure."5 There is a clear and
substantial reason to require strict compliance with rules requiring a timely notice of
appeal .
I concurred with the unanimous Court in Foxworthy and dissented in Excel
on the*view that timely tender of the notice of appeal is sufficient, and that failure to pay
the filing fee is a remedial defect . We should overrule Excel and return to the sound
principles contained in Foxwo rthy.
Graves, J., joins this concurring opinion .
4 Manly v. Manly, Ky., 669 S.W .2d 537at 539-40 (1984) .
5816 S .W.2d at 909 .
,Suprrmr C~vixrf of ~rnfurhV
2002-SC-0055-DG
NORWEST BANK MINNESOTA, N .A .
APPELLANT
ON REVIEW FROM COURT OF APPEALS
2000-CA-0995-MR
LAUREL CIRCUIT COURT NO . 1999-CI-0704
V.
DARREL HURLEY
APPELLEE
ORDER MODIFYING OPINION
On the Court's own motion, the Opinion of the Court rendered herein on April 24,
2003, is modified by the substitution of pages one and five, hereto attached, in lieu of
pages one and five of the Opinion as originally rendered . Said modification does not
affect the holding of the Opinion or the Concurring Opinion by Chief Justice Lambert
and is made only to correct a typographical error.
Entered : May i
2003 .
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