Rabo Agrifinance, Inc. v. Rock Creek Farms, Finnemans
2013 SD 64
| S.D. | 2013Background
- David and Connie Finneman owned ~17,000 acres encumbered by mortgages and judgments; they transferred the land to Rock Creek Farms (RCF) to avoid foreclosure.
- Rabo Agrifinance sued in foreclosure; Judge Delaney entered a January 2010 judgment granting Rabo’s motion but (contrary to pleadings) recognized RCF’s one-year owner’s redemption rights.
- The Arnoldys purchased judgments against the property and later moved under SDCL 15-6-60(b) to set aside the portion of the foreclosure judgment recognizing RCF’s redemption rights; Judge Delaney vacated those redemption provisions on May 26, 2011.
- RCF and Finnemans appealed; their consolidated appeal was dismissed by this Court (Rabo I) because the United States, a party defendant, was not timely served with the notice of appeal.
- RCF and Finnemans then filed Rule 60(b) motions in the trial court (Judge Pfeifle) seeking relief from the May 26, 2011 order on grounds of counsel’s mistake/excusable neglect and other reasons; Judge Pfeifle denied relief, concluding Rule 60(b) could not be used to circumvent the Supreme Court’s dismissal.
- This appeal challenges Judge Pfeifle’s denial of Rule 60(b) relief; the Supreme Court affirms, holding Rule 60(b) relief inappropriate where it would effectively relitigate or negate this Court’s prior jurisdictional dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Rule 60(b) relief was available to undo the effects of this Court’s dismissal of the prior appeal (Rabo I) | RCF/Finneman: counsel’s failure to serve the U.S. was excusable neglect or an extraordinary circumstance; Rule 60(b)(1) or (6) should relieve them | Arnoldys/Rabo: Rule 60(b) is not a vehicle to relitigate an appeal dismissed as jurisdictionally defective; relief would undermine finality and precedent | Court: Denied—Rule 60(b) cannot be used to overturn this Court’s dismissal for lack of timely service; motions were improper as they sought to relitigate the prior appeal |
| Whether counsel’s failure to timely serve the United States constituted "excusable neglect" under SDCL 15-6-60(b)(1) | RCF/Finneman: counsel’s mistake was inadvertent and should be liberally excused | Arnoldys: mistake of law and failure to comply with clear, jurisdictional appeal rules is not excusable neglect | Court: Denied—mistake of law and failure to comply with well-established service rules is not excusable neglect |
| Whether the catchall provision SDCL 15-6-60(b)(6) justified relief for extraordinary circumstances | RCF/Finneman: argue equitable relief is warranted given consequences of counsel’s error | Arnoldys: no extraordinary facts; the error is ordinary counsel negligence and falls within other subsections | Court: Denied—(b)(6) unavailable where the asserted ground is encompassed by other subsections and circumstances are not extraordinary (Gold Pan distinguished) |
| Whether Judge Pfeifle erred as a matter of law by concluding he lacked authority to grant Rule 60(b) relief that would contradict this Court’s dismissal | RCF/Finneman: trial court should have considered Rule 60(b) merits and granted relief | Arnoldys: trial court correctly declined to relitigate an issue resolved by the Supreme Court | Court: No error—review de novo; Judge Pfeifle correctly refused relief because doing so would eviscerate this Court’s ruling and established law on timely service |
Key Cases Cited
- Rabo Agrifinance, Inc. v. Rock Creek Farms, 813 N.W.2d 122 (S.D. 2012) (Court dismissed appeal for failure to timely serve the United States; jurisdictional defect)
- Corcoran v. McCarthy, 778 N.W.2d 141 (S.D. 2010) (Rule 60(b) relief reviewed for abuse of discretion)
- Geier v. Geier, 828 N.W.2d 804 (S.D. 2013) (definition and standard for excusable neglect)
- Gold Pan Partners, Inc. v. Madsen, 469 N.W.2d 387 (S.D. 1991) (example of extraordinary attorney misconduct warranting relief under Rule 60(b)(6))
- Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847 (U.S. 1988) (Rule 60(b)(6) as extraordinary relief; should not be used where other subsections apply)