Brady v. Park, 2019 UT 16

Background

1996 seller‑financed sale: Bradys bought commercial property from Kang S. Park, financed by a $675,000 promissory note (the Note) with monthly $5,923.61 installments (Jan 1997–Oct 2006) and a balloon payment Oct 31, 2006; base interest 10%.
Note contained two penalty provisions for late installment payments: (1) a 10% late fee and (2) a bump of base interest to 20% "until note is brought current." 20% rate was added at Park’s request.
Parties disputed whether "brought current" required payment only of missed installment amounts or also of accrued default interest and/or late fees; litigation began in 2006 and proceeded through district court, Utah Court of Appeals, and this appeal addressing seven issues.
On remand the district court: found Note ambiguous on some points, held late fee did not apply to balloon payment (based on extrinsic memorandum), adopted an accounting favoring Bradys' dates (contrary to earlier neutral accountant), awarded judgment to Bradys with 10% pre‑ and postjudgment interest, denied attorney fees, and entered joint and several judgment against Park Defendants including IRA custodian.
Utah Supreme Court: addressed mandate‑rule limitations, contract interpretation (plain meaning vs extrinsic evidence), application of late fee to balloon payment, correctness of payment dates (mandate rule), appropriate prejudgment/postjudgment interest statutes and rates, Rule 60(b) challenge to joint/several designation, attorney fees remand, and jurisdiction over Park’s IRA.

Issues

Issue	Plaintiff's Argument (Bradys)	Defendant's Argument (Park Defs.)	Held
Whether 20% default interest stops when installment is paid or requires payment of accrued default interest/late fees to "bring current"	Bradys: 20% accrual runs only while an installment is late and stops when that installment (plus any immediate late installment payment) is paid.	Park: "Brought current" requires payment of all outstanding obligations (including accrued 20% default interest and/or 10% late fees) to stop 20% accrual.	District court erred by construing ambiguity against drafter without first considering extrinsic evidence; note is ambiguous; remand for factfinding on extrinsic evidence. Mandate rule did not bar consideration.
Whether 10% late fee applies to final balloon payment	Bradys: late fee applies only to monthly installments, not to the separate balloon payoff.	Park: "payment" in late fee clause covers all payments, including balloon.	Affirmed district court: plain language + parties’ memorandum show late fee not intended for balloon; extrinsic evidence not clearly erroneous; unconscionability need not be reached.
Whether district court on remand violated mandate rule by changing installment payment dates used for accounting	Bradys: payment dates used on remand were proper (used check face dates).	Park: court was bound by its pre‑appeal legal and factual findings and the neutral accountant’s pre‑appeal dates; changing them violated mandate rule.	Reversed: remand court violated mandate rule by adopting different payment dates; must use pre‑appeal dates/accounting.
Whether district court properly awarded 10% pre‑ and postjudgment interest under Utah Code §§15‑1‑1 and 15‑1‑4	Bradys: Note specifies 10% interest; §15‑1‑1 and §15‑1‑4 authorize 10% awards.	Park: statutory schemes limited to contracts for loans/forbearance and to interest agreed for the debt at issue; this judgment compensates for overpayment (not an express contract obligation).	Reversed: §15‑1‑1 does not authorize 10% prejudgment interest on judicial overpayment recovery; §15‑1‑4(2)(a) likewise cannot export the contract rate to a judicially created refund obligation. Pre‑ and postjudgment interest must be recalculated (postjudgment per §15‑1‑4(3)(a) federal rate +2%).

Key Cases Cited

Meadow Valley Contractors, Inc. v. State Dep’t of Transp., 266 P.3d 671 (Utah 2011) (when contract language is ambiguous, court should admit and assess extrinsic evidence; construe against drafter only if extrinsic evidence fails to reveal intent)
Mind & Motion Utah Invs., LLC v. Celtic Bank Corp., 367 P.3d 994 (Utah 2016) (contract interpretation is a question of law; extrinsic‑evidence‑based intent findings are factual)
Plateau Mining Co. v. Utah Div. of State Lands & Forestry, 802 P.2d 720 (Utah 1990) (ambiguity makes parties’ intent a factual question; ambiguity exists where contrary positions are "tenable")
USA Power, LLC v. PacifiCorp, 372 P.3d 629 (Utah 2016) (clarified §15‑1‑1 applies to loan/forbearance contracts and narrowed earlier broader readings)
Commercial Real Estate Investment, L.C. v. Comcast of Utah II, Inc., 285 P.3d 1193 (Utah 2012) (set standard for unconscionability analysis referenced on remand)
In re Adoption of Baby B., 308 P.3d 382 (Utah 2012) (appellate review standard: factual findings based on extrinsic evidence are reviewed for clear error)