Green v. Gerber, DA 12–0054.

Decision Date12 February 2013
Docket NumberNo. DA 12–0054.,DA 12–0054.
PartiesLinda GREEN, Plaintiff, Appellant, and Cross Appellee, v. Ronald Ray GERBER and Stockton Oil Company, Defendant, Appellee, and Cross Appellant.
CourtMontana Supreme Court

369 Mont. 20
303 P.3d 729

Linda GREEN, Plaintiff, Appellant, and Cross Appellee,
v.
Ronald Ray GERBER and Stockton Oil Company, Defendant, Appellee, and Cross Appellant.

No. DA 12–0054.

Supreme Court of Montana.

Submitted on Briefs Nov. 7, 2012.
Decided Feb. 12, 2013.


[303 P.3d 730]


For Appellant: Patricia D. Peterman, Patten, Peterman, Bekkedahl & Green, PLLC, Billings, Montana.

For Appellee: Perry J. Schneider, Tim E. Dailey, Milodragovich, Dale, & Steinbrenner, P.C., Missoula, Montana.


Justice PATRICIA O. COTTER delivered the Opinion of the Court.

[369 Mont. 21]¶ 1 In December 2008, Linda Green was driving her vehicle southbound on Highway 87 North in Musselshell County, Montana, when she was struck by a truck owned by Stockton Oil Company (Stockton Oil or Stockton) and driven by Ronald Ray Gerber. Green suffered bodily injuries as a result of the accident as well as property damage to her vehicle. On January 7, 2011, Green filed a Complaint in the Fourteenth Judicial District Court against Stockton Oil and Gerber seeking damages. Stockton Oil was served but Gerber was not. Stockton did not respond to the Complaint and a default was entered against the company in February 2011. A damages hearing was subsequently conducted and a judgment for damages totaling

[303 P.3d 731]

$308,200 was entered in April 2011. In October 2011, Stockton moved to set aside the default judgment. Sixty-eight days later, the District Court granted Stockton's motion.

¶ 2 Green appeals, contending the District Court lacked jurisdiction to set aside the default judgment once 60 days expired, citing M.R. Civ. P. 60(c) (1). She also opines that Stockton failed to satisfy the [369 Mont. 22]elements of a successful Rule 60(b) motion. Stockton urges us to uphold the District Court order setting aside the default judgment. In the event we conclude the motion was deemed denied by operation of Rule 60(c)(1) and the District Court's order must therefore be vacated, it cross-appeals, arguing that the deemed denial constituted a slight abuse of discretion. We reverse and remand.

ISSUES

¶ 3 Direct appeal: Did the District Court err in granting Stockton Oil's Motion to Set Aside Default Judgment 68 days after it was filed?

¶ 4 Cross-appeal: Did the District Court slightly abuse its discretion in deeming denied Stockton's motion to set aside the default judgment?

FACTUAL AND PROCEDURAL BACKGROUND

¶ 5 On December 2, 2008, Green's vehicle was struck by a Stockton Oil Company truck driven by Ronald Gerber. Green was injured and her car was damaged. Following the accident, Green and Stockton Oil's insurer, EMC, worked together for a period of time during which EMC paid $139,246.80 toward Green's medical bills and resolution of the claim. However, in late December 2010 discussions broke down and on January 7, 2011, Green filed a Complaint and Demand for Jury Trial (Complaint) against Stockton Oil and Gerber seeking damages. On January 10, 2011, summonses were prepared for both Stockton Oil and Gerber, and on January 27, Stockton Oil was served with the Complaint and Summons.1

¶ 6 On February 22, 2011, a default was entered against Stockton after the company failed to answer the Complaint. On March 31, 2011, the District Court held a hearing to determine Green's damages. Green did not disclose to the court receipt of funds from EMC. On April 5, 2011, the District Court entered a Judgment by Default against Stockton Oil ordering the company to pay Green $308,200 in damages plus 10% interest per annum. These damages included claims for past and future medical bills, emotional distress, loss of enjoyment of life, and pain and suffering.

¶ 7 On September 26, 2011, a Writ of Execution for Green's judgment was issued. It was served on Stockman Bank on October 11, 2011. The record reveals that $138,273.15 was collected from both Gerber's and [369 Mont. 23]Stockton Oil's Stockman Bank accounts on behalf of Green and placed in trust with Green's attorney. However, these levied funds were subsequently returned to Gerber and Stockton.2

¶ 8 On October 19, 2011, citing M.R. Civ. P. 60(b)(6), Stockton Oil filed a Motion to Set Aside Default Judgment. Stockton Oil primarily argued that Green had failed to disclose to the District Court that she had received payments totaling $139,246.80 from Stockton Oil's insurer, EMC. Stockton maintained that the Default Judgment in the amount of $308,200 should be set aside as it represented excessive damages in light of the undisclosed insurance payments.

¶ 9 On October 31, 2011, Green filed her brief in opposition to Stockton Oil's motion. She argued that she had not yet recovered monies pursuant to the Judgment, and she acknowledged that the $308,200 judgment would be reduced by the amount of funds previously received from Stockton's insurer. She also argued that Stockton's motion should not be granted because Stockton

[303 P.3d 732]

could not satisfy the elements of a successful Rule 60(b) motion.

¶ 10 Pursuant to Rule 60(c), the District Court had 60 days within which to rule on Stockton's Rule 60(b) motion to set aside the default judgment. The failure to rule within those 60 days resulted in the motion being “deemed denied.” Rule 60(c)(1). The deadline for the District Court's ruling was December 19, 2011. In a two-line order dated December 27, 2011, the District Court, without explanation or rationale, granted Stockton's motion to set aside the default judgment.

¶ 11 On January 17, 2012, Stockton Oil filed an answer to Green's Complaint on behalf of itself and Gerber. Green appeals the District Court's order granting Stockton's motion, asserting in part that upon expiration of the 60 days allocated for a ruling under Rule 60(c), the District Court lost jurisdiction over the matter and could no longer issue any rulings in the case. In the alternative, she argues that Stockton failed to establish that it was entitled under Rule 60(b) to have the default judgment set aside. Stockton argues the court's order setting aside the default judgment was correct, and that the order should stand in light of the misconduct of Green's counsel in the manner in which she obtained the default judgment.

STANDARD OF REVIEW

¶ 12 Whether a district court has jurisdiction to rule on a matter is a [369 Mont. 24]question of law which we review to determine whether the district court had authority to act. A court exceeds jurisdiction through acts which exceed the defined power of a court, whether that power be defined by constitutional provisions, express statutes or rules developed by the courts. In re Marriage of Richards, 2001 MT 183, ¶ 5, 306 Mont. 212, 31 P.3d 1002.

¶ 13 We review the deemed denial of a motion to set aside a default judgment for a slight abuse of discretion. Ford Motor Credit Co. v. Wellnitz, 2008 MT 314, ¶ 11, 346 Mont. 61, 194 P.3d 630.

DISCUSSION

¶ 14 Did the District Court err in granting Stockton Oil's Motion to Set Aside Default Judgment 68 days after it was filed?

¶ 15 M.R. Civ. P. 55(c) permits a court to set aside a default judgment in accordance with Rule 60(b). Rule 60(b)(1)-(5) allows a party to file a motion with the district court to relieve the party from a final judgment, order or proceeding for several specific reasons, including but not limited to, a mistake, newly discovered evidence, fraud, and a void or satisfied judgment. Rule 60(b)(1)-(5). Rule 60(b)(6) allows a party to seek relief from a final judgment for “any other reason that justifies relief.” A party seeking relief under Rule 60(b) must file its motion “within a reasonable time.” 3Rule 60(c)(1)(2011). Rule 60(c)(1) further provides that if the court fails to rule on the 60(b) motion within 60 days after the motion is filed, “the motion must be deemed denied.”

¶ 16 For many years, district courts and this Court have stated that once a motion has been deemed denied, the district court loses jurisdiction to act further. See e.g. State ex rel. Sinko v. District Court, 64 Mont. 181, 187–88, 208 P. 952, 955 (1922); Johnson v. Eagles Lodge Aerie 3913, 284 Mont. 474, 478, 945 P.2d 62, 64 (1997); Wellnitz, ¶ 17;Mobley & Sons, Inc. v. Weaver, 2009 MT 312, ¶ 17, 352 Mont. 396, 218 P.3d 472. For the reasons set forth below, these cases as well as those cited in footnote 4 are to a limited extent overruled.

¶ 17 In Miller v. Eighteenth Jud. Dist. Court, 2007 MT 149, 337 Mont. 488, 162 P.3d 121, we acknowledged our confusing and often “confounding” use of the term “jurisdiction.” In Miller, we were asked to determine the consequences of a prosecutor's failure to file a notice [369 Mont. 25]of intent to seek the death penalty within 60 days of criminal arraignment. Standard 1.1 a of the Montana Supreme Court Standards for Competency of Counsel for Indigent Persons in Death Penalty Cases (Standard) obligates a prosecutor

[303 P.3d 733]

to file in the district court and serve upon counsel of record within 60 days after arraignment a notice stating whether the prosecutor intends to seek the death penalty upon a conviction. The prosecutor in Miller let the 60 days following arraignment expire without filing the notice. Miller, ¶ 6. Upon expiration of the 60–day notice of intent period, Miller and his co-defendant LeBrum filed separate motions to preclude the State from seeking the death penalty and preclude imposition of the death penalty as a sentence. Miller,¶ 7. The State subsequently filed its notice of intent arguing that the defendants were not prejudiced by its delinquent filing. Miller, ¶ 8. The district court agreed and denied Miller's and LeBrum's motions. Miller, ¶ 12. Miller and LeBrum sought supervisory control from this Court. Miller,¶ 14.

¶ 18 Miller and LeBrum argued that the 60–day deadline created “a jurisdictional defect” precluding the State from seeking the death penalty and imposing it as a sentence. Miller, ¶ 42. We responded that “[i]t is important not to confuse categorical time prescriptions with jurisdictional provisions.” Miller, ¶ 43. We...

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