PRIORITY OF JUDGMENT LIENS: ROLAND G. TAYLOR FUNERAL HOME, INC. v. COMMONWEALTH (COA 7/27/2007)

ROLAND G. TAYLOR FUNERAL HOME, INC.  v. COMMONWEALTH
PROPERTY: PRIORITY OF JUDGMENT LIENS (RESTITUTION AND COMMONWEALTH)

2006-CA-001638
PUBLISHED: VACATING AND REMANDING
PANEL: COMBS PRESIDING; NICKELL, WINE CONCUR
COUNTY:CLARK
DATE RENDERED: 7/27/2007

Rolan G. Taylor Funeral Home, Inc., appeals from an order of distribution of the Clark Circuit Court. The COA determined that the circuit court erroneously based its decision on an invalid Judgment Lien in awarding assets to non-parties. Therefore, COA vacates and remands.

Ms. Rose was convicted and the state obtained a judgment lien on her real property owned by Ms. rose at French St. for $19,500 to secure the restitution owed (1999).  She died and the funeral home sued her son on the funeral bill and obtained a judgment lien on all real estate that the son had an interest (2002).  In a third action, the Cabinet for Health and Family Services as guardians was awarded punitive damages against the estate for $38,000 in punitive damages (even though Kentucky does not permit punitive damages against a deceased defendant) and filed the second lien against the property on French Street (2004).

The Commonwealth declined to present a claim on its lien so that lien became wholly unenforceable per KRS 532.164(4).  “The attorney for the Commonwealth, and not the crime victim [the Guardian here] shall prepare and file lien documents for moneys to be restored to the crime victim.” (Emphasis added.) In this case, the Cabinet stood in the shoes of the crime victim. As such, the Cabinet’s counsel was not an attorney for the Commonwealth for purposes of the statute. Thus, the Cabinet did not have standing to file the lien initially or to enforce it after it had been abandoned by the Commonwealth.

In this case, the Clark County Commonwealth’s attorney was the real party at interest in the criminal proceeding, the party who bore the burden of preparing the judgment lien on behalf of the crime victims [i.e., the daughters of Houston Osborne through their Guardian the Cabinet].   The Cabinet as Guardian had filed its own judgment lien in 2004. As aptly noted by the appellant, there was no need for the Guardian to file the 2004 lien if it believed that it was entitled to rely on the Commonwealth’s 1999 lien to satisfy its claim. In the meantime, Taylor had filed its 2002 judgment lien – arguably temporally inferior to the 1999 lien but superior to the 2004 lien of the Guardian.

When the Commonwealth of Kentucky released its 1999 judgment, the next valid lien of record assumed priority. That superior lien was the 2002 judgment lien filed by Taylor to recover funeral expenses and thus had priority as to the distribution of the proceeds of the sale to satisfy its claim.

By Michael Stevens

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