Am. United Family of Credit Unions v. Murray

• Decision Date: 25 August 2022
• Docket Number: 20200903-CA
• Citation: 517 P.3d 1069
• Parties: AMERICAN UNITED FAMILY OF CREDIT UNIONS, Appellee, v. Jason MURRAY, Appellant.
• Court: Utah Court of Appeals

517 P.3d 1069

AMERICAN UNITED FAMILY OF CREDIT UNIONS, Appellee,
v.
Jason MURRAY, Appellant.

No. 20200903-CA

Court of Appeals of Utah.

Filed August 25, 2022

D. Scott Crook, Salt Lake City, Attorney for Appellant

Joseph A. Skinner, Salt Lake City, Attorney for Appellee

Judge Ryan D. Tenney authored this Opinion, in which Justice Jill M. Pohlman and Judge Ryan M. Harris concurred.¹

Opinion

TENNEY, Judge:

¶1 After Jason Murray defaulted on over $60,000 in loans from American United Family of Credit Unions (American United), American United sued Murray to collect. Murray and American United soon agreed to a stipulated settlement that contained, among other things, a payment schedule, an attorney fee provision, and a Confession of Judgment under which American United could later obtain an ex parte judgment against Murray if he didn't comply with the payment schedule.

¶2 Murray defaulted on the payment schedule within a month of the settlement, so American United obtained a judgment against Murray pursuant to the Confession of Judgment. But despite its efforts, American United had considerable difficulty collecting. After four years of effort, American United filed a motion to augment the judgment to account for the attorney fees that it had incurred in its collection efforts. At that point, Murray filed a motion asking the court to set aside the judgment. The district court denied Murray's motion, and it also augmented the attorney fees award to include the fees that American United had incurred over the previous two years.

¶3 Murray now challenges both rulings. For the reasons set forth below, we affirm.

BACKGROUND

Stipulation and Confession of Judgment

¶4 Jason Murray began borrowing money from American United in 2013. Through what the parties have referred to as Note I, Murray borrowed $55,091.83, and he used a Mercedes Benz to secure that note. Through what the parties have referred to as Note II, Murray borrowed $8,800. Murray also opened two credit cards with American United, and those cards are referred to in the record as Visa Card I and Visa Card II.

¶5 Murray failed to timely repay American United for the notes or his credit card debts. In August 2016, American United filed a complaint against Murray for, among other things, breach of the contracts underlying Note I, Note II, Visa Card I, and Visa Card II. Through an attorney, Murray answered American United's complaint.

¶6 In October 2016, the parties agreed to a "Stipulated and Conditional Confession of Judgment" (the Stipulation). There, the parties agreed that the Stipulation was an effort "to avoid the time, expense, and potential uncertainty of progressing" with American United's lawsuit against Murray. The parties further agreed that the Stipulation was intended "to resolve their differences upon the

517 P.3d 1072

terms and conditions stated" in the Stipulation.

¶7 The Stipulation outlined the outstanding amounts that Murray owed under Note I, Note II, Visa Card I, and Visa Card II, as well as the amount of attorney fees that American United had incurred "in connection with this matter." Then, in a separate section titled "Confession of Judgment," the Stipulation stated, "Murray agrees to pay American United the sum of $74,871.91 (which sum includes the total amount due under Note I, Note II, Visa Card I and Visa Card II, plus attorney fees and costs incurred)."

¶8 The Confession of Judgment also set forth a payment schedule, and it further stated that if Murray didn't follow the schedule, Murray "stipulate[d] to entry of judgment in favor of American United in the amount of $74,871.91, less any amounts actually paid by Murray ... together with interest accruing on the Judgment Amount at the rates corresponding to" the two notes and the two Visa credit cards. Note I and Note II were attached to the Stipulation, and the corresponding interest rate for each was listed in the notes themselves. The contracts underlying the two Visa credit cards were also attached to the Stipulation. The interest rates for the cards were not identified in those respective contracts; instead, those contracts stated that Murray would be subject to rates that had previously been provided in a "Credit Card Account Opening Disclosure."

¶9 The Confession of Judgment also included a provision that we'll refer to as the Waiver of Notice provision. This provision provided that if Murray failed to keep up with the payment schedule, American United would "be entitled to immediately file this Confession of Judgment with the Court via an ex-parte motion and affidavit identifying the specific default and the appropriate Judgment Amount, without any further notice to Murray, and to the entry of a judgment against Murray for the total Judgment Amount."

¶10 In a final section of the Stipulation that was titled "Additional Provisions," Murray "represent[ed] and warrant[ed] that he has had sufficient opportunity to review this Confession of Judgment, either individually or through counsel of his choosing, and that he has voluntarily entered into this Confession of Judgment for its stated purpose." The Stipulation then contained electronic signatures from both American United's CEO and Murray, with an additional notation indicating that Murray's original signature was on file.²

Murray's Default and the Parties’ Subsequent Motions

¶11 Murray defaulted less than a month after he agreed to the Stipulation. Shortly after his default, American United filed an ex parte motion and affidavit with the district court seeking a judgment against Murray according to the terms of the Stipulation and the Confession of Judgment. In November 2016, the district court entered a judgment (the Judgment) against Murray "for the confessed amount of $74,871.91, plus attorney's fees of $1,032.00 and costs of $2.00, for a total judgment of $75,905.91, together with interest accruing at the contract rates corresponding to Note I, Note II, Visa Card I and Visa Card II." A couple of weeks after the Judgment was entered, the district court entered an Abstract of Judgment, which outlined the principal amount and attorney fees for the Judgment and stated the corresponding interest rates for Note I, Note II, Visa Card I, and Visa Card II. The court's docket notes that the judge signed the abstract on December 5, 2016.

¶12 Over the next four years, American United tried to enforce the Judgment against Murray. Its efforts included a writ of replevin

517 P.3d 1073

to repossess the Mercedes Benz, several writs of garnishment, and various other litigation tools. Despite these efforts, the notes and Visa credit card debts were still not fully paid off.

¶13 In August 2020, Murray moved to set aside the Judgment pursuant to rule 60(b)(4) of the Utah Rules of Civil Procedure, which provides for relief from judgment when "the judgment is void."³ In that motion, Murray made two main arguments.

¶14 Murray first argued that the Judgment had not complied with rule 58A(i) of the Utah Rules of Civil Procedure. That rule states that when a confession of judgment is statutorily authorized, "the party seeking the judgment must" (among other requirements) file a statement "that the specified sum is due or to become due." Utah R. Civ. P. 58A(i). Murray argued that because the Confession of Judgment did not include "the interest rates for the loans" under Visa Card I or Visa Card II, the Confession of Judgment had not identified the "specified sum" that he owed as required by rule 58A(i). From this, Murray asked the court to grant him relief under rule 60(b)(4), arguing that the error rendered the Judgment "void in its entirety."

¶15 Murray's next argument was more complicated, and it essentially involved three interdependent parts. According to Murray: (i) the Utah Consumer Credit Code (UCCC) prohibits creditors and debtors from entering into confessions of judgment, see Utah Code Ann. § 70C-2-201 (LexisNexis 2020), so the Confession of Judgment that he (a debtor) had entered into with American United (his...