In re Kann, Court of Appeals No. 16CA0259

• Docket Nº: Court of Appeals No. 16CA0259
• Citation: 488 P.3d 245
• Case Date: July 13, 2017
• Court: Court of Appeals of Colorado

488 P.3d 245

IN RE the MARRIAGE OF Josephine Marie KANN, n/k/a Josephine Marie Voshell, Appellee,
and
Bruce Allen KANN, Appellant.

Court of Appeals No. 16CA0259

Colorado Court of Appeals, Division III.

Announced July 13, 2017

J. Matthew DePetro, Greenwood Village, Colorado, for Appellee.

Pelegrin & Radeff, P.C., Andrew N. Hart, Lakewood, Colorado, for Appellant.

Opinion by JUDGE WEBB

¶ 1 In a post dissolution of marriage proceeding, should laches be recognized as a defense to collection of spousal maintenance arrearages or interest on arrearages? This question is undecided in Colorado and no clear majority rule has emerged among courts of other states. We conclude that laches should be recognized as a defense to collection of both arrearages and interest.

¶ 2 Therefore, we reverse the trial court's order in part and remand for further proceedings on laches and its potential impact on the court's maintenance and attorney fees awards. However, we affirm rejection of the waiver and estoppel defenses to collection.

I. Facts and Procedural Background

¶ 3 The decree dissolving the marriage between Bruce Allen Kann (husband) and Josephine Marie Kann, now known as Josephine Marie Voshell (wife), was entered in 1989.

¶ 4 Under the terms of the parties' separation agreement, which the trial court incorporated into the decree, husband agreed to pay wife lifetime maintenance of no less than $1200 per month. The agreement also provided that in the event of a breach, the prevailing party would be entitled to recover costs, expenses, and reasonable attorney fees. Although husband was unrepresented in the dissolution proceeding, he has never disputed that he knew of and understood these terms.

¶ 5 For the next twenty-six years, husband never paid maintenance and wife never asked him to do so. But in 2015, suddenly things changed.

¶ 6 Wife retained counsel and sought entry of judgment for $520,636.32—$289,200 in unpaid maintenance and $231,436.32 in interest. She also requested a maintenance modification if the court did not award her the full judgment. Husband denied any obligation to pay maintenance. He raised three affirmative defenses: waiver, estoppel, and laches. Alternatively, he asked that if wife received her full judgment, the court should terminate his maintenance obligation.

¶ 7 The court held a hearing. Wife and husband (now also represented by counsel) testified. In lengthy oral findings and conclusions, the court

• concluded that under the decree, husband was obligated to pay maintenance;

• held that Colorado law does not recognize husband's laches defense;

• found that husband had failed to meet his burden of proof on the waiver and estoppel defenses; and

• enforced the full $520,636.32 judgment against him.

¶ 8 Going forward, the court decreased wife's lifetime maintenance award from $1200 to $800 per month. Finally, it awarded wife

488 P.3d 249

her attorney fees as the prevailing party under the separation agreement.

¶ 9 Husband appeals these findings and conclusions. Wife concedes preservation.

II. Application of Laches in Proceedings to Enforce Past Due Spousal Maintenance Payments

¶ 10 Husband primarily contends he should have been able to raise laches in defending against wife's claim for past due spousal maintenance and interest. We hold that laches may be raised as a defense to both an unpaid spousal maintenance award and any accrued interest.

A. Standard of Review and Law

¶ 11 The availability of an affirmative defense is a question of law subject to de novo review. In re Marriage of Johnson , 2016 CO 67, ¶ 9, 380 P.3d 150.

¶ 12 No Colorado case has addressed whether laches applies in a proceeding brought solely to collect maintenance arrearages and interest. But several cases have addressed this defense in proceedings to enforce combined support (child support and maintenance) or child support awards. See Hauck v. Schuck , 143 Colo. 324, 327, 353 P.2d 79, 81 (1960) (child support); Jenner v. Jenner , 138 Colo. 149, 151, 330 P.2d 544, 545 (1958) (combined support); Hamilton v. Hamilton , 104 Colo. 615, 618-19, 94 P.2d 127, 128 (1939) (same); Price v. Price , 80 Colo. 158, 160, 249 P. 648, 649 (1926) (same); In re Marriage of Meisner , 807 P.2d 1205, 1207 (Colo. App. 1990) (child support).

¶ 13 Those cases have held that while laches is an available defense when a party brings a contempt citation to punish nonpayment of support, see, e.g. , Price , 80 Colo. at 160, 249 P. at 649, it is not available in actions to collect past due support, see, e.g. , Hauck , 143 Colo. at 327, 353 P.2d at 79 ; Jenner , 138 Colo. at 151, 330 P.2d at 545 ; see also Frick v. Frick , 500 P.2d 373, 374 (Colo. App. 1972) (not published pursuant to C.A.R. 35(f) ) (laches released husband from enforcement of contempt judgment for support owed between 1963 and 1971, but did not apply to enforcement of his current support obligation). The latter conclusion rests on the rationale that a support order is a continuing money judgment. See Hauck , 143 Colo. at 327, 353 P.2d at 81.

¶ 14 In Johnson , 2016 CO 67, 380 P.3d 150, our supreme court re-examined whether laches applies as a defense to recovery of statutory interest in a child support enforcement action. The trial court did not have the benefit of this decision when it ruled.

¶ 15 Johnson involved a 1983 decree of dissolution that required the husband to pay $400 in monthly child support. Id. at ¶ 2. Twenty-nine years later, the wife sought and received a judgment against him for $23,260.27 in unpaid child support, plus interest. Id. at ¶¶ 3, 5. The husband's laches defense was rejected by the magistrate, the trial court on review, and a majority of a division of this court. See id. at ¶¶ 3-4, 6 ; In re Marriage of Johnson , 2014 COA 145, 409 P.3d 398, rev'd , 2016 CO 67, 380 P.3d 150.

¶ 16 Specially concurring, Judge Berger opined that laches provides "a needed ‘safety-valve’ in unusual cases." Johnson , 2014 COA 145, ¶ 21, 409 P.3d 398. He pointed to a recent supreme court case, Hickerson v. Vessels , 2014 CO 2, 316 P.3d 620, holding that laches can be a defense to both legal and equitable claims and that "legislatively prescribed limitations periods do not ordinarily preclude a laches defense." Johnson , 2014 COA 145, ¶ 23, 409 P.3d 398 (quoting Hickerson , ¶ 17 ). And he offered that Hickerson 's rationale "is fully applicable, at least to the interest component of child support arrearages." Id. at ¶ 24.

¶ 17 On certiorari review, the supreme court generally agreed with the special concurrence. The court noted that Hickerson "cast doubt on" the earlier opinions barring laches as a defense to claims for interest on past due child support. Johnson , 2016 CO 67, ¶ 21, 380 P.3d 150. Then it framed this issue by distinguishing between principal and interest.

¶ 18 As to principal, the court began by recognizing that child support belongs to children, not their parents. Id. at ¶ 22. It explained, "as a policy matter, a parent's delay in enforcing a judgment for child support

488 P.3d 250

should not prejudice the child's right to parental support." Id . Unsurprisingly, it adhered to the view that laches should not be a defense to principal.

¶ 19 But the court's approach to interest was more nuanced. Citing out-of-state authority, the court recognized the anomaly of a "dilatory parent" who "waits until the child has reached the age of majority to seek unpaid child support," a time when the award might reimburse that parent but would "not cognizably advance the child's welfare." Id . at ¶ 23. Next, it drew on Price —a contempt action—for the proposition that recovering arrearages of alimony "amounts simply to a reimbursement of the wife. She is the one who reaps the benefit." Johnson , 2016 CO 67, ¶ 24, 380 P.3d 150 (quoting Price , 80 Colo. at 160, 249 P. at 649 ). The court synthesized these principles by observing that allowing a laches defense to interest "would serve the dual purposes of protecting the right of children to parental support and encouraging parents to enforce child support obligations promptly." Id. at ¶ 27.

B. Application

1. Interest

¶ 20 We conclude that Johnson 's rationale applies with equal force to proceedings in which a party seeks interest on maintenance arrearages. Specifically, only the recipient spouse benefits from recovering interest on the arrearage. Allowing laches as a defense would encourage prompt assertion of the claim which, as discussed below, could grow exponentially over time. And recovering accrued interest after a lengthy delay could be a windfall. Cf. Price , 80 Colo. at 160, 249 P. at 649 (noting that where the recipient spouse "reaps the benefit" of a past due recovery, laches should apply "in cases where the arrears in alimony relate to alimony for her own support").

2. Principal

¶ 21 Whether laches should be recognized as defense to principal presents a harder question. Granted, Johnson declined to apply laches to bar collection of the principal amount of child support. See 2016 CO 67, ¶ 22, 380 P.3d 150. Yet, the policy underpinnings of this portion of the opinion do not apply to spousal maintenance. Three differences are informative.

¶ 22 First, child support is...