Business & Divorce
When Does Interest Begin to Accrue on Unpaid Payments?

When Does Interest Begin to Accrue on Unpaid Payments?

March 07, 2018

The Marriage of Dalgleish & Selvaggio

Published November 30, 2017

In a partial reversal, Second District Court of Appeals holds that interest began to run on an equalizing payment on the due date specified in the parties’ stipulated judgment and not on the date that the trial court made the post-judgment ruling on Wife’s request, which regarded the enforcement of the equalizing payment.

Facts of the Case

On December 7, 2009, Stacy Dalgleish and Piero Selvaggio signed a stipulated judgment on reserved issues that dealt with all their issues in the divorce except for custody and visitation. The judgment stated the parties would engage a real estate appraiser to appraise real properties they own on Pico Blvd in Santa Monica to determine the fair market value as of September 2, 2008 and the day of a transmutation agreement on May 1, 2003. Any increase in the value between those two dates would be split equally between the parties and Husband agrees to pay Wife a tax-free equalization payment. The equalization payment was to be paid within 10 days of receiving the appraisal report. The judgment contained no provision regarding challenging the appraisal.

Between 2012 and 2013, the attorneys discussed getting the property appraised. The chosen appraiser conducted the appraisal and in his report indicated that there was a $2,192,103 increase in the fair market value from 2003 to 2008. Thus, one half of the appreciation would be $1,096,051.50. This report was sent to the parties’ attorney on July 26, 2013. In February 2014, Husband’s business attorney wrote to the appraiser and questioned the report that had been generated. The issue remained unsolved when Wife filed a Request for Order on August 2, 2014 to enforce the equalization payment, plus interest of 10%. Husband contends that Wife never agreed to retain the appraiser and the appraiser was not a joint appraiser.

At the hearing on October 31, 2014, the court announced the tentative findings:

  1. Husband had no right to challenge the appraisal.
  2. The appraiser was hired as a joint appraiser under the terms of the judgment.
  3. Husband was stopped from challenging if it was a joint appraisal.
  4. Husband’s lawyer requested an evidentiary hearing.
  5. At the evidentiary hearing, the court rules that the appraisal was joint.

Husband owed Wife one half of the appreciated value, while the date for payment of the equalization payment was extended from 10 days to 90 days with interest accruing from October 31, 2014. Husband’s attorney then argued that interest could only begin to accrue when there was a certain sum owed. The trial court agreed and held that interest wouldn’t accrue until March 11, 2015, or the date of the trial. Wife appealed the interest issue. Husband appealed the challenge of the appraisal.


The justices first began by affirming the law that equalizing payment is a money judgment subject to statutory interest provisions and that per CCP 685.020 interest on a money judgment begins to accrue on the date of entry of judgment. The appellate court held that the interest would accrue 10 days after the report was due pursuant to the agreement the parties had entered. The trial court incorrectly thought that interest would accrue on the date it made its orders. The court found that the evidentiary hearing was a hearing to enforce the judgment and therefore reversed the lower court orders.

This case deals with relatively complex facts about when interest attaches to a money judgment and the effect on a stipulation. The case was remanded back to the trial court with instructions to calculate interest from August 2013. Interest would accrue at a rate of $9,133 per month or $109,605 per year.

The best practice is to hire an experienced family law attorney when dealing with these complicated issues. Contact Edgar Family Law for a free initial consultation with an experienced family law attorney, or call (888) 251-9618. Offices located in RiversideTemeculaAnaheim and Palm Desert.


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