First Community Bank of Blanchard v. Hodges, 85021

• Decision Date: 07 November 1995
• Docket Number: No. 85021,85021
• Citation: 1995 OK 124,907 P.2d 1047
• Parties: FIRST COMMUNITY BANK OF BLANCHARD, an Oklahoma Banking Corporation, Appellant, v. Melba Ruth HODGES, Appellee.
• Court: Oklahoma Supreme Court

Page 1047

907 P.2d 1047

1995 OK 124

FIRST COMMUNITY BANK OF BLANCHARD, an Oklahoma Banking Corporation, Appellant, v. Melba Ruth HODGES, Appellee.

No. 85021.

Supreme Court of Oklahoma.

Nov. 7, 1995.

Certiorari to the Court of Appeals, Division No. 3; W. Dean Hart, Jr., District Judge.

G. Thorne Stallings, Jr., Blanchard, for Appellant.

Stephen L. Bruce, Richard S. Winblad, Greg McCracken, Oklahoma City, for Appellee.

KAUGER, Vice Chief Justice:

The first impression question presented is whether the wife's lien filed in the county where the husband's real property was located, but not filed in accordance with 12 O.S.1991 § 706, ¹ is superior to a general judgment

lien filed later in time in compliance with § 706. We find that it is.

FACTS

Melba Ruth Hodges (wife) and Mansel Hodges (husband) were divorced in McClain County, Oklahoma, on January 21, 1993. The husband was awarded certain real property located in Blanchard, McClain County, Oklahoma. The wife was awarded $36,000.00 alimony in lieu of property division payable in six consecutive yearly installments of $6,000.00 to begin on January 2, 1996. The $36,000.00 was secured by a decree-ordered lien against the husband's real property. ² A certified copy of the journal entry order and divorce decree was filed on January 21, 1993, with the McClain County Clerk.

In June of 1994, the First Community Bank of Blanchard (Bank) obtained a default judgment in McClain County District Court against the husband for $18,711.24, plus post-judgment interest and costs. On July 15, 1994, the Bank filed a general money judgment lien pursuant to 12 O.S.1991 § 706. ³

The Bank filed an action for declaratory judgment on October 6, 1994, naming the wife. The Bank requested that the court find its judgment lien superior to any interest which the wife claimed in the husband's real property. Pursuant to its request for declaratory judgment, the Bank filed a motion for summary judgment, arguing that its lien was superior to the wife's lien because she had failed properly to perfect her lien under 12 O.S.1991 § 706. The wife also filed a motion for summary judgment asserting that she was not required to perfect her lien under § 706. The trial court entered summary judgment for the wife and against the Bank on January 5, 1995. The Bank appealed and the Court of Appeals reversed. We granted certiorari on September 26, 1995, because the priority contest between the Bank's lien and the wife's lien presents a question of first impression.

TITLE 12 O.S.1991 § 706 DOES NOT CONTROL THE ISSUE OF PRIORITY BETWEEN THE BANK'S GENERAL JUDGMENT LIEN AND THE WIFE'S DECREE-ORDERED LIEN. THE WIFE HAS A VALID LIEN WHICH IS SUPERIOR TO THE BANK'S LIEN.

The Bank argues that the wife was required to comply with 12 O.S.1991 § 706 ⁴ in order to perfect her lien, and that because the wife failed to perfect her lien under § 706, its lien is superior. The wife counters that § 706 is inapplicable. She insists that her lien is superior to the Bank's lien because she filed her divorce decree with the McClain County Clerk.

This Court has not previously addressed the precise issue of whether a spouse, who secures a decree-ordered lien payable in periodic future installments, must comply with 12 O.S.1991 § 706 in order to perfect a decree-ordered lien. Neither party cites a case which is directly on point; and our research does not reveal any cases which have determined a similar issue under facts like those presented here.

However, this Court has long held that a trial court may impose a decree-ordered lien against property to secure payment of alimony. ⁵ The lien is an equitable lien created by force of judicial decree. ⁶ Title Central to the Bank's position is that the wife's decree-ordered lien is a money judgment lien; and that pursuant to 12 O.S.1991 § 706 ⁹ no judgment which awards the payment of money becomes a valid lien upon real estate until the requisite form is filed with the county clerk under § 706. We agree with the Bank that the wife was awarded money which was secured by a lien. However, the wife's alimony award was ordered payable in future installments which do not begin until January of 1996. In Record v. Record, 816 P.2d 1139, 1142-43 (Okla.1991), we held that an acceleration clause in a divorce decree was invalid because it allowed court-ordered future installment payments of alimony in lieu of property division to become due and payable prior to their maturity. Recognizing that the court could have ordered the alimony due and payable at once, we stated that:

                43 O.S.Supp.1992 § 134(A) directs the trial court to clearly express its intent to create a decree-ordered lien from the language in the divorce decree. 7  No lien is created in a divorce decree unless the court specifically creates one.  Here, it is clear that the divorce decree created an equitable lien against the husband's real property to secure the payment of the wife's alimony. 8
                

"We have long held, however, that where periodic payments are ordered, they are not owing and enforceable until they are each due. The right to enforce a periodic payment of 'alimony or support ... accrues on each payment as it matures and the statute of limitations begins to run on each installment from the time fixed for its payment.' " (Citations omitted.).

Pursuant to Record, the husband's debt is not yet outstanding, or enforceable. Title 12 O.S.1991 § 706 is a general statute which allows general money judgments to be converted into liens upon real property. Section 706 expressly provides the methods for judgment creditors such as the bank to obtain and perfect a money judgment lien once a judgment for money is entered against a judgment debtor. Until the husband's alimony debt is in arrearage, there is no money judgment within the meaning of 12 O.S.1991 § 706. ¹⁰ Rather, the decree-ordered lien secured the wife's future alimony installments against specific parcels of the husband's real estate. The wife's security interest in this real property is analogous to a real estate mortgage lien which secures a specific parcel of real property for the payment of a sum of money, due on a certain date. ¹¹

Our interpretation is buttressed by 12 O.S.1991 § 801 which requires that a judgment lien against realty be executed and levied within one year after rendition of the judgment in order to preserve its priority over other subsequent judgment creditors. ¹² If a decree-ordered lien like the wife's were filed under 12 O.S.1991 § 706 it could not be executed within one year after the divorce decree is rendered and it would lose superiority under § 801. ¹³ The determination of legislative intent controls statutory interpretation. ¹⁴ The intent is ascertained from the whole act in light of its general purpose and objective. ¹⁵ Accordingly, we find that the husband is not a judgment debtor, nor is the wife's alimony award which was secured by the decree-ordered equitable lien a judgment within the meaning of the general lien statute.

This holding is a natural extension of prior cases in which we recognized that alimony in lieu of property division is not an ordinary money judgment. The wife's alimony judgment was given for satisfaction of a property division obligation. ¹⁶ In Martin v. Martin, 350 P.2d 270, 273 (Okla.1960), this Court refused to apply a general statute which would allow interest on a lump sum award of alimony in lieu of property division. We recognized that in divorce actions where one party seeks or is awarded a money judgment in lieu of alimony or property settlement, there is no specific previously existing obligation or liability. We stated that:

"[c]ases involving divorce and alimony are in a class apart from those wherein judgments are sought for money only...." (Citations omitted.)

A decree impressed lien is not a general judgment for the recovery of money. One who has a decree impressed lien need not comply with § 706. Here, the wife filed the decree with the McClain County Clerk where the real property was located. ¹⁷ The Bank

                argues that notice is insufficient when the divorce decree is filed with the County Clerk, unless it is filed under 12 O.S.1991 § 706.  We find this argument unpersuasive.  The purpose of statutes which govern the filing of liens and their perfection is to protect third parties who act in good faith and without notice. 18  The Bank in its motion for summary judgment concedes that after searching records at the McClain County Court Clerk's office, it located the wife's lien and identified the husband's property which was encumbered by it.  The Bank had actual notice of the wife's lien.  Even if the Bank had not had actual notice of the lien, it at least had constructive notice. 19  Consequently, the wife's lien was perfected when the divorce decree was filed, and it is superior to the Bank's lien which was perfected later in time in accordance with § 706. 20
                

THE WIFE'S MOTION FOR APPEAL-RELATED ATTORNEY FEES SHOULD BE GRANTED.

The wife has filed a motion for appeal-related attorney fees. Appeal-related attorney fees are recoverable when there is statutory authority for the award of attorney fees in the trial court. ²¹ Because 42 O.S.1991 § 176 ²² provides a basis for the award in the trial court, the wife's motion is granted.

CONCLUSION

Title 12 O.S.1991 § 706 is a general statute which is intended to give lienable quality to a judgment for the recovery of money. Section 706 allows a general money judgment to be converted into a lien upon real property. However, such a lien is not created from a money judgment until compliance with § 706.

The wife did not need to comply with § 706 in order to have the decree impressed with a lien. Her divorce judgment was made a lien by force of judicial decree. A decree impressed lien is not a general judgment for the recovery of money. One who has a decree impressed lien need not comply with § 706. Merely filing the divorce decree in the county clerk's...