Could a Kentucky court clerk report an unpaid car loan judgment to suspend the buyer's driver's license after a crash?

Plain-English summary

In 1995, Kentucky's Attorney General told a circuit court clerk that an unpaid car installment contract judgment could not be reported as a motor vehicle accident judgment for license and registration suspension. The creditor's claim arose because the buyer failed to make payments. The fact that the buyer had wrecked the vehicle did not change the basis of the claim.

The motor vehicle judgment provisions the AG examined applied to a narrower category: final judgments on claims arising from the ownership, maintenance, or use of a vehicle for injury or property damage, or from an agreement settling such damages. The clerk's duty to send a certified judgment to the Transportation Cabinet attached only to judgments within that statutory definition. The opinion addressed a vendor's claim for payment under an installment contract, not every dispute following a crash.

Currency note

This opinion was issued in 1995. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Historical summary

Circuit court clerks

For the installment payment judgment described in the request, the AG said the clerk could not certify it to the Transportation Cabinet under KRS 187.400(1). The statutory word “judgment” did not reach a creditor's contract claim merely because the buyer had wrecked the car.

Vehicle buyers and installment creditors

The opinion separated a debt for missed payments from a claim for accident damage. In the AG's fact pattern, the creditor's cause of action depended on the buyer's failure to honor the payment agreement. The ruling concerned certification for the motor vehicle suspension process; it did not decide whether the creditor could obtain or collect its contract judgment through other means.

Transportation officials

The AG explained that the cabinet's suspension provision operated upon receipt of a certified judgment of the kind defined by KRS 187.290(3). The creditor's installment contract judgment did not qualify, so the clerk could not send it through that statutory route.

Common questions

Did wrecking a financed car turn unpaid installments into an accident judgment?

No. The AG focused on the basis of the creditor's lawsuit: the buyer did not make the promised payments. A crash mentioned in the complaint did not make the contract judgment one arising from vehicle ownership, maintenance, or use for the purposes of the statute examined.

Could the clerk report that contract judgment to suspend a license?

No. The AG said KRS 187.400(1) did not permit certification of that judgment to the Transportation Cabinet. The related suspension provision therefore did not apply through this reporting route.

What kind of judgment did the 1995 statute cover?

The definition quoted in the opinion covered final judgments for bodily injury, death, or property damage arising from ownership, maintenance, or use of a vehicle, as well as judgments on agreements settling those damages. The opinion's unpaid installment judgment was different.

Background and statutory framework

KRS 187.290(3) supplied the definition of “judgment” used in the motor vehicle chapter. KRS 187.400(1) required a clerk to send a certified copy after an applicable judgment remained unsatisfied for the stated period, and KRS 187.410(1) described the cabinet's suspension action upon receipt. The AG read these provisions together and concluded that the installment creditor's contract claim fell outside their judgment definition.

Citations and references

• KRS 187.290(3): the judgment definition central to the opinion.
• KRS 187.400(1): the clerk's certification duty for qualifying judgments.
• KRS 187.410(1): the suspension provision discussed by the AG.

Source

• Landing page: https://www.ag.ky.gov/Resources/Opinions/Opinions/OAG95-034.htm

Original opinion text

OAG 95-34

October 26, 1995

Subject: Whether Clerk of Court May Lawfully Certify Judgment for Default on Installment Payment Contract as a “Judgment Involving a Motor Vehicle Accident,” For Purposes of Suspension of Driver's License and Vehicle Registration Pursuant to KRS 187.410(1).

Written by: Gerard Gerhard

Requested by: Hon. W. David Deskins, Pike County Circuit Court Clerk

Syllabus: A judgment obtained by an installment payment creditor, against one who, after wrecking a vehicle, defaults on payments thereon, is a judgment upon a cause of action arising out of a breach of contract, rather than upon a cause of action arising out of “ownership, maintenance or use of a motor vehicle,” KRS 187.290(3), and thus is not a judgment the clerk of court may lawfully certify to the Transportation Cabinet pursuant to KRS 187.400(1), for suspension of a driver's (operator's) license and vehicle registration.

OAGs cited: None.

Statutes construed: KRS 187.290(3), KRS 187.400(1), KRS 187.410(1)

OPINION OF THE ATTORNEY GENERAL

The following question, in substance, has been presented:

May the clerk of court lawfully certify to the Kentucky Transportation Cabinet, for purposes of suspension of a driver's license (motor vehicle operator's license) and (motor vehicle) registration pursuant to KRS 187.410(1), that a judgment in an action for failure to make payments under an installment payment contract is a judgment “involving a motor vehicle accident”?

In our view the answer is no. The key to answering the question is found in the statutory definition of the term “judgment,” as that term is used in KRS Chapter 187. That definition is set forth in KRS 187.290(3) (see below). Discussion follows.

KRS 187.410(1) provides:

Upon receipt of a certified copy of a judgment, the cabinet shall forthwith suspend (except as provided in KRS 187.440) the license and registration and the non-resident's operating privilege of any person against whom such judgment was rendered.

(Emphasis added.)

KRS 187.400(1) provides:

Whenever any person fails within sixty (60) days to satisfy any judgment, it shall be the duty of the clerk of the court in which any such judgment is rendered within this state to forward to the cabinet immediately after the expiration of said sixty (60) days a certified copy of such judgment. It the defendant named in any certified copy of a judgment reported to the cabinet is a nonresident, the cabinet shall transmit a certified copy of the judgment to the official in charge of the issuance of licenses and registration certificates of the state of which the defendant is a resident.

(Emphasis added.)

“Judgment,” as used in KRS Chapter 187, unless the context requires otherwise, is defined in KRS 187.290(3) in the following terms:

“Judgment” means any judgment which has become final by expiration without appeal of the time within which an appeal might have been perfected, or by final affirmation on appeal, rendered by a court of competent jurisdiction of any state or of the United States, upon a cause of action arising out of the ownership, maintenance or use of any motor vehicle, for damages, including damages for care and loss of services, because of bodily injury to or death of any person, or for damages because of bodily injury to or destruction of property, including the loss of use thereof, or upon a cause of action on an agreement of settlement for such damages.

(Emphasis added.)

From the statutory text emphasized above, it can be seen that KRS Chapter 187 is applicable to judgments “upon a cause of action arising out of the ownership, maintenance or use of any motor vehicle.” There is no contextual usage of the term “judgment” within KRS Chapter 187 that is inconsistent with such view.

The Kentucky Transportation Cabinet supplies to clerks of court a form entitled “REPORT ON CIVIL JUDGMENT INVOLVING A MOTOR VEHICLE ACCIDENT,” form no. TC 94-65, Rev. 4/88, upon which to certify a judgment pursuant to KRS Chapter 187.

Where one in possession of a vehicle under an installment payment contract wrecks the vehicle, and thereafter fails to make payments as agreed, and an action is brought by the vendor entitled to payment indicating as the cause of action that the defendant “wrecked car and refused to honor contract,” the cause of action, in our view, arises from the breach of the installment payment contract, rather than from “ownership, maintenance or use of any motor vehicle” (KRS 187.290(3)). By way of explanation, the creditor's right of action (cause of action) is not based upon the fact that the defendant wrecked, or owned, maintained, or used a vehicle. Instead, the creditor's cause of action arises from the breach of the contract concerning payment for the vehicle. It follows that a judgment resulting from such action is not one “involving a motor vehicle accident” within the scope of KRS Chapter 187. Accordingly, the clerk of court may not lawfully certify such judgment to the Transportation Cabinet pursuant to KRS 187.400(1).

Gerard R. Gerhard

Assistant Attorney General