Silva v. Silva

• Decision Date: 28 July 2017
• Docket Number: No. 20160171-CA.,20160171-CA.
• Citation: 402 P.3d 36
• Parties: David SILVA, Appellee, v. Bonnie SILVA, Appellant.
• Court: Utah Court of Appeals

402 P.3d 36

David SILVA, Appellee,

v.Bonnie SILVA, Appellant.

No. 20160171-CA.

Court of Appeals of Utah.

Filed July 28, 2017

J. Spencer Ball, Salt Lake City, Attorney for Appellant.

Shawn D. Turner, Attorney for Appellee.

Judge J. Frederic Voros Jr. authored this Opinion, in which Judges Gregory K. Orme and Michele M. Christiansen concurred.

Opinion

VOROS, Judge:

¶ 1 Bonnie Silva appeals the district court's denial of her motions to set aside a default judgment and a sheriff's sale following that judgment. She also challenges the district court's award of attorney fees. We vacate the default judgment and remand for further proceedings.

BACKGROUND

¶ 2 Bonnie Silva and David Silva divorced in 2010. The marital estate included interests in fifteen parcels of real property—four properties held jointly, one property held by David, and ten properties held by Bonnie.¹ The decree allocated the properties and ordered the parties to execute quitclaim deeds within 30 days conveying the properties to one another as specified in the decree. If either party failed to execute a quitclaim deed, the divorce decree authorized the other party to seek a court order transferring title to him or her. One of the properties awarded to David was a residential property located on Dennis Drive in West Valley City (the Dennis Drive Property).

¶ 3 In June 2010, pursuant to the divorce decree, Bonnie executed a quitclaim deed as "Grantor Bonnie Moore, now known as Bonnie Silva," purportedly conveying the Dennis Drive Property to David. But when David attempted to record the deed, he discovered that "Bonnie Moore as Trustee for the Consolidated Trust" held title to the Dennis Drive Property. He further discovered that one week before he had filed for divorce in September 2008, Bonnie conveyed the Dennis Drive Property and other properties in her name to herself and her daughters, K.V. Lum and R. Carter, as trustees of a trust known as the Consolidated Trust. After learning these facts, David sent a revised quitclaim deed to Bonnie, but she did not sign and return it as requested. Several months later, Bonnie, as trustee of the Consolidated Trust, conveyed the Dennis Drive Property and her other properties to Lum as trustee of the Consolidated Trust.

¶ 4 The divorce court held an evidentiary hearing and found Bonnie in contempt for failing to convey the Dennis Drive Property to David. The court ruled that if Bonnie did not convey the Dennis Drive Property to David within 30 days, the court would enter judgment against her in the amount of $219,000. Neither Bonnie nor Lum conveyed the Dennis Drive Property to David. A few months later, Lum, as trustee of the Consolidated Trust, conveyed title to the Dennis Drive Property to Carter as trustee. The divorce court entered judgment against Bonnie for $217,690.62.

¶ 5 The following month David sued Bonnie and her daughters in district court for fraudulent conveyance and quiet title. David filed a motion for alternative service recounting his unsuccessful efforts to serve Bonnie with the complaint. David asserted that the process server had attempted personal service at Bonnie's last known address four separate times. The district court ordered alternative service by publication, which David accomplished.

¶ 6 Bonnie did not answer the complaint. The district court consequently entered a default certificate against Bonnie and ordered an evidentiary hearing on damages. Concerned that Bonnie may not have received adequate notice of the hearing, the district court rescheduled the hearing and required additional service on Bonnie. David attempted service by mailing copies of the notice of hearing to Bonnie's last known address by both regular mail and certified mail. David also attempted personal service whereby the process server left the notice of hearing at her last known residence on three separate occasions. David then completed service by publication again.

¶ 7 Bonnie did not appear at the hearing on damages. In its Findings of Fact and Conclusions of Law, the district court found that "Service of Process of the Complaint and notice of the evidentiary hearing on damages were in accordance with the Rules of the Court, the Statutes of Utah and the Constitutional requirements of due process." The district court also found that Bonnie had fraudulently conveyed the Dennis Drive Property and her other properties to the Consolidated Trust. Accordingly, the district court ruled that the $217,690.62 judgment entered in the divorce court attached to the properties, that defendants were enjoined from transferring or encumbering the properties, and that David "may levy execution on the properties ... and sell the amount of the property necessary to satisfy the judgment." Finally, the district court awarded attorney fees and costs to David against Bonnie. The district court thus entered default judgment against Bonnie in the amount of $217,690.62 plus interest, $48,315.62 in attorney fees, and $964.34 in costs. The district court also issued a writ of execution on three of Bonnie's properties, including the Dennis Drive Property.

¶ 8 Later that same month, Bonnie's counsel entered an appearance in the district court and filed a motion pursuant to rule 60(b) of the Utah Rules of Civil Procedure seeking to set aside the default judgment and to quash the writ of execution. The district court held a hearing, which Bonnie and her counsel attended. At the hearing Bonnie maintained that the default judgment should be set aside on the ground of insufficient service. Bonnie acknowledged that service complied with the letter of the law, but argued that David knew where Bonnie was located and could easily have contacted her. Bonnie filed an affidavit with her rule 60(b) motion and a second affidavit with her reply motion. In the first affidavit, she alleged that she had not received notice of the current action against her. She further alleged that she received a call from David notifying her that "something was wrong with the quitclaim deed" but that "David never indicated to [her] in that telephone call that there was any court proceeding[.]" In her second affidavit, she alleged that David knew of various means of contacting her, including her two email addresses or through his son or her children and the renters of their properties. David did not contest these allegations.

¶ 9 The district court denied Bonnie's motions. The court denied the motion to set aside on the ground that "service and the resulting default were appropriate," given Bonnie's failure to provide evidence supporting her assertions. Similarly, the court denied the motion to quash for failure to provide evidence of irreparable harm.

¶ 10 Four days later, the Dennis Drive Property and the other two properties subject to the writ of execution were sold at a sheriff's sale. Bonnie responded with a motion for a temporary restraining order (TRO), a motion to void the execution sale, and a motion to join the sale purchasers as parties to the action. After a hearing, the district court denied the TRO on the ground that Bonnie had failed to meet the required elements for relief. The court denied the motion to join the purchasers on the ground that "[Bonnie] cites rules that apply before a judgment is made and are not applicable for a case as this one where judgment was entered." The court noted that, "even if there was no judgment in this case, there is no basis, claim, or cause of action asserted against the purchasers." The court denied the motion to void the execution sale on the ground that the court had already ruled at the TRO hearing that the notice of sale was properly served.

¶ 11 Bonnie appeals the district court's denial of her motions to set aside the default judgment and the sheriff's sale and the district court's award of attorney fees to David.

ISSUES AND STANDARDS OF REVIEW

¶ 12 Bonnie asserts three claims of error on appeal. First, she contends that the district court abused its discretion in denying her motion to set aside the default judgment, arguing that she has shown excusable neglect and a due process violation because service of process failed to give her actual notice. We generally review a district court's denial of a rule 60(b) motion under an abuse of discretion standard. Utah Res. Int'l, Inc. v. Mark Techs. Corp. , 2014 UT 60, ¶ 11, 342 P.3d 779. "Whether a person has been served with process is a question of fact, but whether a person is properly served is a question of law." Cooper v. Dressel , 2016 UT App 246, ¶ 2, 391 P.3d 338 (brackets, citation, and internal quotation marks omitted). "Thus, while we review the district court's factual findings as to service for clear error, we review its legal conclusions flowing therefrom for correctness." Id.

¶ 13 Second, Bonnie contends that the district court abused its discretion in denying her motion to set aside the sheriff's sale, claiming she lacked notice and pointing to irregularities in the sale. " ‘[A] district court's decision to set aside a sheriff's sale is to be reviewed for an abuse of ... discretion.’ " Meguerditchian v. Smith , 2012 UT App 176, ¶ 9, 284 P.3d 658 (omission in original) (quoting Pyper v. Bond , 2011 UT 45, ¶ 24, 258 P.3d 575 ).

¶ 14 Third, Bonnie contends that the district court abused its discretion in awarding attorney fees to David, arguing that the fee award lacked factual findings and was unreasonably large. A trial court's conclusion as to what constitutes a reasonable attorney fee award is reviewed for an abuse of discretion. USA Power, LLC v. PacifiCorp , 2016 UT 20, ¶ 90, 372 P.3d 629 (citation and internal quotation marks omitted).

ANALYSIS

I. Rule 60(b) Motion

¶ 15 Bonnie contends that the district court abused its discretion in denying her rule 60(b) motion to set aside the default judgment. She argues that "[t]he requirements of Rule 60(b) were fully fulfilled ... to have the default judgment set aside, far beyond any discretion of the trial judge to deny it."...