In Re the Marriage of Chase
323 P.3d 266
Or.2014Background
- Parties divorced in 1999; judgment required Father to pay recurring child support installments and later supplemental judgments modified the monthly amount.
- Multiple arrearage proceedings followed; in 2010 the Washington County DA issued a notice to establish arrears and Father requested an administrative hearing.
- An ALJ found arrears but declined to add "interest on interest," treating the determination as an accounting rather than a new judgment; Mother sought de novo review in circuit court.
- The circuit court entered an arrearage judgment combining unpaid installments and accrued interest, then—relying on ORS 82.010(2)(c)—awarded postjudgment interest at 9% on both principal and previously accrued interest.
- The Court of Appeals affirmed; Father sought review in the Oregon Supreme Court challenging (1) the circuit court’s authority to enter the arrearage judgment and (2) the award of interest on interest under ORS 82.010(2)(c).
Issues
| Issue | Father’s Argument | Mother’s Argument | Held |
|---|---|---|---|
| Authority to enter an arrearage judgment for past child support after prior support judgments | Circuit court lacked authority to enter a new arrearage judgment because support was already established in governing judgments | The arrearage judgment is a valid child support judgment under ORS 25.089 and may be entered to establish arrears | Court rejected Father’s challenge and held the circuit court had authority to enter the child support arrearage judgment |
| Whether ORS 82.010(2)(c) permits postjudgment interest to accrue on previously accrued interest ("interest on interest") for unpaid support installments | Interest that accrued before the arrearage judgment was itself postjudgment interest (each unpaid installment is a judgment), so § 82.010(2)(c) (prejudgment-interest-on-interest rule) does not apply | § 82.010(2)(c) applies to interest that accrued before the entry of the later judgment; thus the arrearage judgment can impose interest on previously accrued interest | Court held ORS 82.010(2)(c) does not apply: interest on unpaid child-support installments after an initial judgment are postjudgment (simple) interest under § 82.010(2)(b); postjudgment interest cannot be compounded under (2)(c) as prejudgment interest on interest. Court reversed the inclusion of $4,902.58 of interest-on-interest that Father preserved on appeal (but left earlier unchallenged interest-on-interest intact) |
Key Cases Cited
- PGE v. Bureau of Labor and Industries, 317 Or. 606 (1993) (statutory construction principles)
- Highway Comm. v. DeLong Corp., 275 Or. 351 (1976) (distinguishing prejudgment and postjudgment interest; merger of prejudgment interest into judgment)
- Meskimen v. Larry Angell Salvage Co., 286 Or. 87 (1979) (prejudgment interest should be made part of judgment so postjudgment interest applies)
- Mannix and Mannix, 146 Or. App. 36 (1997) (Court of Appeals decision interpreting ORS 82.010(2)(c), relied on by circuit court)
- Stephan v. Equitable Sav. & Loan Ass’n, 268 Or. 544 (1974) (contrast between simple and compound interest)
