In Re The Marriage Of Tanya Lynn Ginsberg And John D. Ginsberg Upon The Petition Of Tanya Lynn Ginsberg

• Court: Supreme Court of Iowa
• Decided: May 16, 2008
• Docket: 35 / 06–0615
• Status: Published

Opinion

IN THE SUPREME COURT OF IOWA No. 35 / 06–0615

Filed May 16, 2008

IN RE THE MARRIAGE OF TANYA LYNN GINSBERG AND JOHN D. GINSBERG

Upon the Petition of TANYA LYNN GINSBERG,

Appellee,

And Concerning JOHN D. GINSBERG,

Appellant.

On review from the Iowa Court of Appeals.

Appeal from the Iowa District Court for Polk County, Donald C.

Nickerson, Judge.

Appellee appeals court of appeals’ decision raising claim preclusion

sua sponte. DECISION OF THE COURT OF APPEALS VACATED;

DISTRICT COURT JUDGMENT AFFIRMED.

Alexander R. Rhoads of Babich, Goldman, Cashatt & Renzo, P.C.,

Des Moines, for appellant.

Jeanne K. Johnson, Des Moines, for appellee. 2

PER CURIAM.

Tanya and John Ginsberg ended their marriage in 2004. Their

dissolution decree ordered John to pay the debt the parties owed to

Tanya’s father and hold Tanya harmless from any liability. Because the

parties could not agree on how much was owed, the decree stated the

amount of the debt was “disputed.” John did not repay Tanya’s father.

Tanya eventually repaid the loan herself and brought this action seeking indemnification from John under the terms of the decree. The district

court ordered John to pay Tanya $121,000. John appealed. The court

of appeals held claim preclusion barred Tanya’s action and remanded the

case to the district court to dismiss. On further review, we hold claim

preclusion does not bar an action to enforce the decree. We vacate the

decision of the court of appeals and affirm the decision of the district

court.

I. Facts and Prior Proceedings.

Tanya and John Ginsberg were divorced on March 22, 2004. The

district court entered a decree based upon the parties’ stipulation. See

Iowa Code § 598.8(2)(a) (2003). The decree contained a provision

regarding debt the parties owed to Tanya’s father, Ron Daniels: “[John] shall pay the debt, the amount of which is disputed, to Ron Daniels and

hold [Tanya] harmless therefrom.”

Daniels provided the parties substantial financial assistance

during the marriage. In September 1991, Daniels loaned the parties

$124,561.28 for the purchase of a home in Elkhart, Iowa. The loan was

to be repaid within ninety days through a mortgage on the property. The

parties chose instead to make periodic payments to Daniels. Between

1991 and 1998, the parties paid him $34,893.71. During May 1999,

Daniels loaned the parties $180,000 for a down payment on a home in 3

Des Moines. The parties repaid Daniels $180,000 five months later when

they sold their Elkhart home. Additionally, the parties borrowed $70,000

from Daniels in August 2001. The parties made payments to Daniels

totaling $38,398 between October 2001 and May 2003. The payments

stopped after Tanya filed for divorce. In summary, Daniels loaned the

parties a total of $374,561.28 and received $253,291.71 in payments for

a balance of $121,269.57. After the divorce was finalized, Daniels repeatedly asked Tanya

when John was going to pay him. Tanya testified she grew tired of her

father’s questioning and paid Daniels $121,000. Thereafter, she filed a

“Motion to Enforce the Decree, or in the Alternative, Application for

Declaratory Judgment” in order to recover from John the amount she

paid.

The district court held a hearing and found the amount of the

disputed debt to Daniels was $121,269.57. The court ordered John to

pay Tanya $121,000 because she “is the real party in interest in as much

as she paid her father.” The court also ordered John to pay Daniels

$269.57. The court denied Tanya’s request for interest because Daniels

testified it was not his custom to charge family members interest. The court also denied Tanya’s request for fees.

John appealed, arguing there was insufficient evidence to support

the ruling. The court of appeals sua sponte raised the issue of claim

preclusion in its ruling. It stated:

Either party could have insisted the district court decide the debt issue prior to the entry of the decree; but instead, they chose to go forward and allowed the issue to remain “disputed” as part of the court’s final order. As Tanya and John willingly relinquished their right to litigate a disputed issue, we conclude that subsequent litigation on the identical issue is barred. 4

The court of appeals also denied Tanya’s request for attorney fees on

appeal.

Thereafter, Tanya applied for further review, which we granted.

She argues the court of appeals erred by raising an issue not presented

to or addressed by the district court. See DeVoss v. State, 648 N.W.2d

56, 63 (Iowa 2002) (holding “we will not consider a substantive or

procedural issue for the first time on appeal, even though such issue might be the only ground available to uphold a district court ruling”).

For the reasons that follow, we vacate the decision of the court of appeals

and affirm the district court.

II. Scope of Review.

We review cases tried in equity de novo. Iowa R. App. P. 6.4.

However, we review the construction of a dissolution decree as a matter

of law. In re Marriage of Goodman, 690 N.W.2d 279, 282 (Iowa 2004)

(citing Sorensen v. Nelson, 342 N.W.2d 477, 479 (Iowa 1984)).

III. Merits.

A. Claim Preclusion. “[C]laim preclusion is a bar to further

litigation of a claim following a final adjudication or judgment on the

merits.” Penn v. Iowa State Bd. of Regents, 577 N.W.2d 393, 398 (Iowa 1998). “[A] party must litigate all matters growing out of the claim, and

claim preclusion will apply ‘not only to matters actually determined in an

earlier action but to all relevant matters that could have been

determined.’ ” Id. (quoting Shumaker v. Iowa Dep’t of Transp., 541

N.W.2d 850, 852 (Iowa 1995)).

We need not decide whether a court may raise claim preclusion

sua sponte because we find the doctrine inapplicable in this case. The

court of appeals held that by leaving the amount owed to Daniels

“disputed,” the parties “relinquish[ed] the right to litigate any and all 5

issues they had” regarding the debt. We disagree. Claim preclusion does

not prevent the enforcement of the decree as it was written. Here, Tanya

was not attempting to relitigate who should repay her father for the

money he loaned the couple during their marriage. That issue had been

decided. Tanya was merely asking the district court to enforce the “hold

harmless” provision of the decree. Such an action is always permissible.

See In re Marriage of Butterfield, 500 N.W.2d 95, 98 (Iowa Ct. App. 1993) (holding a stipulation of settlement in dissolution proceeding is a

contract between the parties that becomes final and binding when it is

accepted and approved by the court). Moreover, even if the decree had

stated the amount the parties owed, Daniels would not be estopped from

proving the loan was for a different amount because he was not a party

to the decree. In a sense, Tanya stepped into Daniels’ shoes when she

paid the debt and then turned to John for reimbursement.

B. Indemnification. According to the decree, John agreed to

hold Tanya “harmless from any liability” stemming from the debt owed to

Daniels. “Hold harmless” is synonymous with “indemnify.” Black’s Law

Dictionary 749 (8th ed. 2004). “In an indemnification contract, one party

promises to reimburse or hold harmless another party for loss, damage, or liability.” Maxim Techs., Inc. v. City of Dubuque, 690 N.W.2d 896, 900

(Iowa 2005).

Since Tanya is seeking indemnification, she has the burden of

proving she is entitled to the relief requested. Mineke v. Fox, 256 Iowa

256, 263, 126 N.W.2d 918, 921 (1964). The measure of relief “is the

actual amount the person, who is secondarily liable, has been compelled

to pay as a natural consequence of the [indemnitor]’s negligence or other

wrong.” Howell v. River Prods. Co., 379 N.W.2d 919, 921 (Iowa 1986)

(quoting 42 C.J.S. Indemnity § 24, at 602 (1944)). Tanya paid Daniels 6

$121,000 to satisfy the amount owed to him. Certainly her payment is

evidence of the amount owed. But because these loans were between

family members, the amount paid is not nearly as compelling as the

amount paid in an arms-length transaction. Nevertheless, we find Tanya

proved the amount owed was $121,269.57 and she was entitled to

$121,000 (the amount she paid).

Daniels and his office manager, who handled both his business and personal finances, testified regarding the amounts loaned and the

amounts repaid. John did not dispute the dollar amounts provided. He

claims the parties only owed Daniels the balance due for the $70,000

loan ($31,602) because the $124,561.28 for the Elkhart house in 1991

was really a gift. John did not explain what basis he had for believing

the money was a gift other than he claimed the parties never made

payments on that particular loan. Tanya offered evidence the parties

paid Daniels $34,893.71 between 1991 and 1998. John testified this

money was payment for a Lexus vehicle he bought from Daniels. The

only evidence he offered in support of this claim was a check for $11,000

John made to Daniels. John wrote in the memo line “1st Lexus pymt.”

However, the check was dated June 13, 2000, and the amount was not included in any of Tanya’s calculations. Thus, John did not disprove

$34,893.71 was paid toward the $124,561.28 loan. Moreover, he offered

no evidence to suggest the balance of the loan was transformed into a

gift. Daniels testified the money was unequivocally a loan. The district

court implicitly found Daniels and Tanya more credible than John. We

find them more credible too.

IV. Conclusion.

The court of appeals erred by applying claim preclusion to Tanya’s

indemnification action. Tanya proved she was entitled to $121,000 from 7

John. The district court properly ordered John to pay Daniels $269.57.

Tanya’s request for appellate attorney fees is denied.

DECISION OF THE COURT OF APPEALS VACATED; DISTRICT

COURT JUDGMENT AFFIRMED.