                                                                                            May 7 2013


                                           DA 12-0416

                   IN THE SUPREME COURT OF THE STATE OF MONTANA

                                           2013 MT 124



IN RE THE MARRIAGE OF:
JOHN R. STEAB,

               Petitioner and Appellee,

         and

LAUNA J. LUNA,

               Respondent and Appellant.



APPEAL FROM:            District Court of the First Judicial District,
                        In and For the County of Lewis and Clark, Cause No. BDR-2002-82
                        Honorable John W. Larson, Presiding Judge


COUNSEL OF RECORD:

                 For Appellant:

                        Launa J. Luna (Self-Represented), Kaysville, Utah

                 For Appellee:

                        Robert T. Cameron, Gough, Shanahan, Johnson & Waterman, PLLP,
                        Helena, Montana



                                                    Submitted on Briefs: February 6, 2013

                                                                Decided: May 7, 2013


Filed:

                        __________________________________________
                                          Clerk
Justice Patricia O. Cotter delivered the Opinion of the Court.

¶1      Launa Luna and John Steab were married in 1987. During the marriage, the

couple had three children, two of whom have reached the age of majority. Steab and

Luna divorced in October 2002 when their children were fifteen and twelve years of age

and twenty-two months old. The children resided at different times with either their

mother or father; therefore both Luna and Steab were at times obligated to the other for

child support. Since their divorce, Steab and Luna have been repeatedly engaged in some

form of litigation against one another and have been before this Court on a previous

appeal. See Steab v. Luna, 2010 MT 125, 356 Mont. 372, 233 P.3d 351 (Steab I). The

most recent proceeding, and the one from which this appeal arises, pertains to child

support arrearages on the part of both parties and the interest to be imposed on those

arrearages. The First Judicial District Court’s order resolved the raised issues in favor of

Steab. Luna, representing herself, appeals. We affirm in part and reverse and remand in

part.

                  FACTUAL AND PROCEDURAL BACKGROUND

¶2      The factual background for this case is set forth in Steab I and will not be repeated

here. This appeal challenges the legal conclusions set forth in the District Court’s June 4,

2012 Order Regarding Child Support Arrearage (June 4, 2012 Order). By the time this

order was issued, the two older children had reached the age of majority. Also, both

parents had had legal primary custody of their youngest daughter at different times and

had failed to timely pay their child support obligations to the other. This resulted in an

arrearage on the part of both parents, raising an issue of the balances due and the interest

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owed on those balances. Additionally, Steab did not complete payment of his ordered

portion of marital debt, and obtained an order of relief in U.S. Bankruptcy Court.

¶3     The District Court’s June 4, 2012 Order determined that Steab’s child support

arrearage was to be offset against Luna’s larger child support arrearage. The court held,

without factual findings, that after such offset Luna owed Steab $2,263.24 plus 12%

interest per annum until paid. The court further ordered that Steab was not required to

pay interest on his arrearages to Luna retroactive to October 2008, and that the marital

debt owed by Steab had been discharged in Bankruptcy Court in 2011 and was no longer

a debt owed by him to Luna.

¶4     It is from the June 4, 2012 Order that Luna appeals.

                                         ISSUE

¶5     Luna raises numerous issues on appeal. A restatement of those issues is:

¶6     Did the District Court commit reversible error when it did not issue findings of

fact and conclusions of law with its June 4, 2012 Order Regarding Child Support

Arrearage?

¶7     Did the District Court err in awarding Steab 12% retroactive interest on Luna’s

arrearage?

¶8     Was Steab’s February 2012 Motion for Order Directing Child Support

Enforcement Division to Offset Arrearage and Request for Attorney’s Fees timely filed

with the District Court?




                                            3
¶9     Did the District Court abuse its discretion by taking judicial notice of a U.S.

Bankruptcy Court determination that Steab’s marital debt was discharged by the

Bankruptcy Court in 2011?

                                STANDARD OF REVIEW

¶10    Determining the method to be used to calculate interest is an issue of law that this

Court reviews to determine whether the district court’s application or interpretation of the

law is correct. Weiss v. Weiss, 2011 MT 240, ¶ 8, 362 Mont. 157, 261 P.3d 1034.

¶11    We review a district court’s decision to take judicial notice of facts and law for an

abuse of discretion. United States v. Chapel, 41 F.3d 1338, 1342 (9th Cir. 1994), cert.

denied, 514 U.S. 1135, 115 S. Ct. 2017 (1995).

                                        DISCUSSION

¶12    This case has a long and complex procedural history. It is unnecessary to recite all

of this history in order to resolve the discrete issues presented. The last three orders of

the court are at issue here. In brief, they are:

       October 19, 2011            Order
       This Order amended and corrected the October 2, 2008 Order and
       Judgment to reflect that as of December 31, 2007, Steab owed $20,648 in
       child support arrears and $13,598.26 in marital debt rather than $34,246.26
       in child support arrears.

       March 27, 2012              Order Regarding Child Support
       This order addressed the District Court’s August 18, 2011 Findings of Fact,
       Conclusions of Law and Order and the court’s October 19, 2011 Order and
       stated:
           1. Steab’s motion requesting an order that the Child Support
               Enforcement Division (CSED) cease garnishing Steab’s wages was
               timely filed;
           2. CSED was ordered to offset Steab’s March 27, 2012 $5,744.28
               arrearage against Luna’s March 27, 2012 $7,378 arrearage;

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           3. CSED was to stop garnishing Steab’s wages;
           4. Steab’s child support obligation was fulfilled; and
           5. the parties were ordered to submit simultaneous interest calculations
              by May 15, 2012.

       June 4, 2012                Order Regarding Child Support Arrearage
       Based upon the parties’ submitted interest calculations, this order:
          1. struck the amount of Luna’s arrearage referenced in the March 27,
              2012 order;
          2. entered a child support arrearage judgment in favor of Steab and
              against Luna for $2,263.24, which included a 12% interest on arrears
              and imposed a 12% annual interest rate until Luna’s arrearage was
              paid in full;
          3. denied Luna’s request for interest retroactive to October 2008; and
          4. took judicial notice that Steab’s marital debt had been discharged in
              Bankruptcy Court in 2011.

¶13    Did the District Court err when it did not issue findings of fact and conclusions of
       law with its June 4, 2012 Order Regarding Child Support Arrearage?

¶14    Luna notes that in the District Court’s March 27, 2012 Order Regarding Child

Support, the court requested that both parties submit an interest calculation regarding

child support arrearages to the court for its consideration. She claims that Steab included

unsolicited information in his submission, in an attempt to “re-litigate the [March 27]

2012 Order Regarding Child Support.” She argues she had no opportunity to respond to

Steab’s submission. She further claims that the District Court considered this unsolicited

information and adopted it, without findings of fact “as to the evidentiary basis,” in the

June 4, 2012 Order. Relying upon In re Marriage of Barron, 177 Mont. 161, 580 P.2d

936 (1978), In re Estate of Craddock, 173 Mont. 8, 566 P.2d 45 (1977), and Jones v.

Jones, 190 Mont. 221, 620 P.2d 850 (1980), and arguing the importance of adequate

findings, Luna asserts this is reversible error.



                                               5
¶15    While we acknowledge that this Court has underscored the critical importance of

adequate findings of fact in the cases cited by Luna, we conclude these cases are

distinguishable and inapposite.   In Barron, we required findings of fact in order to

establish the foundation for the court’s judgment. Barron, 177 Mont. at 164, 580 P.2d at

938. In Craddock, we remanded for findings of fact because the court had not explained

the basis for admitting a contested will to probate. Craddock, 173 Mont. at 11-12, 566

P.2d at 46. In Jones, the appeal was from certain visitation arrangements contained in the

parties’ settlement agreement and divorce decree.         Thus, these cases concerned

determinations made by the district court following trial. Here, by contrast, Steab had

submitted interest calculations as directed by the court, and alerted the court in his

submission that there was an error contained in the court’s previous order pertaining to

Steab’s arrearage amount. Because it is apparent that the court simply adopted Steab’s

analysis as set forth in his motion, it was unnecessary for the court to enter formal

findings and conclusions.     A district court is not required to state findings and

conclusions when ruling on a motion. M. R. Civ. P. 52(a)(3). We therefore reject Luna’s

challenge in this regard.

¶16    Did the District Court err in awarding Steab 12% interest on Luna’s arrearage?

¶17    In Luna’s submission of interest calculations, she calculated interest owed by

Steab at the statutory rate of 10% per annum retroactive to October 2, 2008. Steab, on

the other hand, proposed that interest be calculated beginning on November 1, 2011,




                                            6
shortly after the District Court amended and corrected the October 2008 Order and

Judgment.1 Additionally, he recommended a per annum rate of 12%.

¶18    When Steab submitted his interest calculations, he provided the District Court with

two calculations—one based upon his arrearages as set forth in the March 27, 2012 Order

Regarding Child Support and one using a corrected arrearage balance based upon

CSED’s release of additional payments to Luna. The District Court adopted Steab’s

calculation using the arrearage balances set forth in the March 27, 2012 order.

¶19    In his calculations, Steab applied a 12% annual interest rate on both parties’

arrearages from November 2011 forward. After performing his interest calculations,

Steab determined that he owed $281.01 in interest and Luna owed $516.46 in interest.

Adding these interest amounts to each arrearage balance, Steab concluded he owed Luna

a total of $5,631.22 and Luna owed him $7,894.46. Performing the offset, he subtracted

his arrearage from Luna’s, and derived a total due to him from Luna of $2,263.24. The

District Court adopted this amount and ordered Luna to pay 12% annual interest on this

balance until it was paid in full.

¶20    Citing § 25-9-205, MCA, Luna argues that Steab “cannot collect 12% interest

retroactively” on her alleged arrearage. Section 25-9-205, MCA, provides that interest on

a judgment, with certain exceptions, is at a rate of 10% per year and may not be

compounded. In In re Marriage of Winters, 2004 MT 82, ¶ 49, 320 Mont. 459, 87 P.3d


1
 On October 19, 2011, the court amended its October 2008 Order and Judgment by stating that
Steab’s child support arrearage through December 2007 was not $34,246.26 as stated in the
October 2008 Order and Judgment but rather his unpaid child support was $20,648 and his
unpaid marital debt was $13,598.26.
                                            7
1005, we held that the district court erred when it waived the interest on the husband’s

child support arrearage. We noted that if a marital dissolution decree was silent as to

interest, interest is automatically collectible by the judgment creditor spouse on past due

support or maintenance payments. See also Williams v. Budke, 186 Mont. 71, 79, 606

P.2d 515, 519 (1980). As there was no interest provision in the dissolution decree nor

was there a stipulated agreement between the parties to a higher interest rate, the District

Court erred in adopting Steab’s calculations that included a 12% interest rate on both

parties’ arrearages and in imposing 12% interest on Luna until her arrearage is paid in

full. We therefore reverse the District Court’s ruling as to interest on the arrearages and

remand for a recalculation of interest at the statutory rate of 10%. We also conclude, for

the reasons discussed below, that the District Court erred in calculating interest beginning

in November 2011.

¶21    Did the District Court err when it imposed interest on the parties’ arrearages
       beginning November 2011?

¶22    It is undisputed that Steab was delinquent in his child support payments beginning

shortly after entry of the October 2002 dissolution decree. It is also well-established that

delinquent child support payments become a judgment debt similar to any other money

judgment and upon which statutory interest may be imposed. See In re Marriage of

Brown, 263 Mont. 184, 867 P.2d 381 (1994) and In re Marriage of Hooper (Crittendon),

247 Mont. 322, 806 P.2d 541 (1991). However, in the case before us, the record does not

provide accurate or complete records upon which to calculate interest on Steab’s




                                             8
arrearages dating back to 2003 or 2004. The record does allow such a calculation

beginning October 2, 2008.

¶23    While the October 2, 2008 Order and Judgment incorrectly combined Steab’s

delinquent child support with his delinquent marital debt, it was well documented at that

time that Steab owed Luna $20,648 in back child support. Therefore, based upon our

case law, Luna’s request for interest beginning in October 2008, and the availability of an

accurate arrearage balance upon which to calculate interest, we conclude the District

Court should have imposed a 10% annual rate of interest on Steab’s arrearage beginning

in October 2008.

¶24    Luna’s interest calculation on Steab’s arrearages submitted to the District Court on

May 15, 2012, appears to be correct. Notably, Luna arrives at the same conclusion as

CSED that Steab’s child support obligation was fulfilled and paid in full in January 2012,

based upon payments and offsets.

¶25    We acknowledge this resolution does not provide Luna with interest payments

retroactive to Steab’s earliest delinquency in 2003 and it does not address Steab’s claim

that his delinquent child support was overstated based upon Luna’s alleged salary and

asset misrepresentation to the District Court. However, it nonetheless represents the

fairest resolution the District Court could have reached given the state of the record

before us.

¶26    For the foregoing reasons, we reverse and remand this matter to the District Court

with instructions to recalculate the interest on Steab’s arrearages back to October 2008

and on Luna’s arrearage back to July 2010 using the statutory interest rate of 10% per

                                            9
annum, perform the offset calculation based upon the revised balances, determine Luna’s

new arrearage balance if any, and impose a 10% interest rate on the balance until it is

paid in full.

¶27    Was Steab’s Motion for Order Directing Child Support Enforcement Division to
       Offset Arrearage and Request for Attorney’s Fees timely filed with the District
       Court?

¶28    Luna argues that Steab’s February 14, 2012 motion requesting an order instructing

CSED to offset his arrearage with Luna’s and to cease garnishing his wages should have

been summarily denied because Steab failed to file a timely notice of entry of judgment

after he prevailed in the previous motion proceeding. Luna provides no authority for her

contention that failure to file a notice of entry of judgment under M. R. Civ. P. 77(d)

precludes Steab from filing a subsequent M. R. Civ. P. 60 motion for the correction of an

order within the time provided in Rule 60. The sole authority cited by Luna is Kenney v.

Koch, 227 Mont. 155, 737 P.2d 491 (1987). Kenney, however, stands for the rule that if

both parties prevail in an action, both parties have an obligation to comply with Rule

77(d) and if neither party complies, neither can argue that the other’s appeal is untimely

because no notice of entry of judgment was served. There is nothing in Kenney to

support a conclusion that one must file a notice of entry of judgment in order to preserve

the right to later file a Rule 60 motion. We therefore reject this argument.

¶29    Did the District Court abuse its discretion by taking judicial notice of an order of
       the U.S. Bankruptcy Court that Steab’s marital debt was discharged by the
       Bankruptcy Court in 2011?

¶30    Finally, Luna claims that the marital debt owed to her by Steab “could not be

released via bankruptcy.” Essentially, Luna is asking the District Court and this Court to

                                             10
overturn, or simply ignore, a federal bankruptcy court ruling. We are not authorized to

do so.

¶31      M. R. Evid. 201(d) authorizes the District Court to take judicial notice of facts

when “requested by a party and supplied with the necessary information.” Moreover,

M. R. Evid. 202(b)(6) allows a court to take judicial notice of law, including, “[r]ecords

of any court of this state or of any court of record of the United States or any court of

record of any state of the United States.” See Farmers Plant Aid, Inc. v. Fedder, 2000

MT 87, ¶ 27, 299 Mont. 206, 999 P.2d 315. Steab requested that the court take notice of

the bankruptcy action and supplied the District Court with the necessary information.

Luna’s claim of error is against the U.S. Bankruptcy Court, not the District Court. The

District Court did not abuse its discretion by taking judicial notice of the U.S. Bankruptcy

Court order.

                                     CONCLUSION

¶32      Based upon the foregoing, we reverse and remand the District Court’s June 4,

2012 Order Regarding Child Support Arrearage awarding Steab 12% retroactive interest

and remand with instructions that the court calculate 10% per annum interest, per statute,

on Steab’s arrearage back to 2008 and on Luna’s arrearage back to 2010. We affirm the

District Court’s rulings as to the remaining issues on appeal.



                                                  /S/ PATRICIA COTTER




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We Concur:

/S/ BRIAN MORRIS
/S/ JIM RICE
/S/ LAURIE McKINNON
/S/ BETH BAKER




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