*1 RUSSELL ERIC MAULDING, Respondent,
Plaintiff and v.
ROBERT HARDMAN,
Appellant.
Defendant and
No. 92-409.
Submitted on Briefs December
1992.
February 11,
Decided
1993.
St.Rep.
141.
For Defendant and Joe Gough, Waterman, & Johnson Helena. Doubek, Small, Hatch,
For Plaintiff Respondent: John C. *3 Pyfer, & Helena. Doubek
JUSTICE HARRISON the the Opinion delivered of Court. This is an from the appeal District Court of the First Judicial District, Lewis and Clark the County, Jeffrey Honorable M. Sherlock (Hardman) presiding. Appellant Robert appeals Hardman the from denial of Judgment his Motion to Set Aside Default was which 60(c), M.R.Civ.P, deemed denied under Rule because the District filing. Court failed to rule on it within of its We set aside the a and remand for trial on the merits. The sole issue is whether Hardman is entitled to have the default set aside favor of a trial on the merits. 5, early morning 1989, Hardman, In the September hours of Forsina, respondent Maulding (Maulding), Russell Dan and Crickett were in the driving Martin Sieben Ranch area near Helena. Hardman driving According car. at testimony his mother’s to Hardman’s motion, the car the rounding the on the while a curve slid off due to The car to a the ditch gravel. stop road loose came without drove, hitting any the Maulding obstructions. While other three ditch, of a pushed scraping knocking the car out the a fence and out No they the drove home. After out of ditch way. getting the post along time, injured at the but injured being of complained appeared one next p.m. the cited Hardman around 5:00 highway a patrolman when had Maulding that accident, he learned day reporting for not an charge to the of hospital. pled guilty later the Hardman visited a accident and fine. reporting paid Doubek, Maulding’s attorney, a 13,1989, sent John September On demanding Group Companies Farmers of letter to The Insurance 20, September James Maulding’s expenses. medical On payment of Farmers, spoke with Doubek representative with Higgins, a claims regarding the accident. Given took Hardman’s statement and liability and incident, Higgins questioned Hardman’s version of the According Higgins, Dan Forsina’s at that time. to payment denied 3, 1990, statement, January he which took corroborated incident, conveyed he to and this description Hardman’s of day. Doubek that to only presented Higgins
The documents substantiate record, emergency which indicated injury claimed were room back, of a He Maulding copy prescription. was to rest his claim. Maulding’s Nor substantiating received no other documents report of copy Highway did he receive the Montana Patrol regard- tried contact Doubek Higgins Doubek as he also expected. case, had further ing the but Doubek did not return his calls. He no May sent a letter in Doubek on this matter until Doubek contact with requesting payment judgment. 1991, alleging a against May Hardman on Maulding filed suit given by the accident than Hardman. much different version of alcohol, alleged that Hardman was under the influence Maulding recklessly driving speed, and at excessive carelessly bodily resulting injury they went over an embankment in serious May 1, 1991. The on Hardman on Maulding. complaint was served put had he nothing happened, Hardman was convinced that Because action, drawer, told no one of them. in a took no the documents Hardman’s that the clerk enter requested On June Doubek November appear. or otherwise On failing default for answer judgment on issue District Court entered default *4 show- upon proper later the liability damages be determined with 17,1992, and on damages on on March hearing court held a ing. The 19, $81,306.31. May On in the amount of March 19 entered against an execution writ that the clerk issue requested Doubek Doubek a letter from day Higgins received previous Hardman. On the informing proceedings him of the offering to settle the matter for $75,000 paid immediately. if responded by
The insurer providing Hardman, counsel for who to set the judgment May moved aside default on 22. The court set hearing on July the motion for 1992. hearing, At the Doubek timely, 60(c), raised the issue whether hearing citing of the Rule M.R.Civ.R, 59(d) conjunction (g) which in requires with Rules the court to rule on filing the motion within 45 or it of is deemed denied and the jurisdiction court loses to decide the matter. The court took issue under advisement testimony and heard the regarding judgment. the motion to set aside the judge required The to brief parties the timeliness issue. reading Maulding’s brief,
After Hardman conceded that Dis- jurisdiction trict Court lost July 7,1992, to decide the motion on on which Hardman date it was deemed denied. filed his Notice July 24, on 1992. Appeal
The issue before this Court is whether Hardman entitled have the default set aside in favor of a trial on the merits. Maulding argues simply that there is no evidence the record upon may deciding which Hardman or this rely Court this issue. He points any out that Hardman’s did attorney present affidavits However, of his support longer motion. an affidavit of merit is no under Rules of required Metropolitan our Civil Procedure. Blume v. Life (1990), 787; Co. 465, 470, Ins. 242 Mont. 791 P.2d Keller v. Hanson 307, 309, 485 705,707; 157 Mont. P.2d Rule 11 see also and Rule 60(b), case, support M.R.Civ.P. In this Hardman’s brief in of his motion hearing set forth the facts and the he at evidence intended to show the is all required point. on the motion. That that was at that Maulding argues next that because District Court lost motion, jurisdiction presented to entertain the the evidence at part may by is not of the record and not be cited Hardman 60(c), M.R.Civ.P, relied this Court. Under Rule the motion was Therefore, 45-day expired. deemed denied because the time limit had jurisdiction the District Court lost to entertain the motion. In re 553; Marriage 347, 350, McKinnon 251 Mont. the Marriage 108, 112, 776 In re Miller 1220. However, 3-2-204, power it is this Court’s Section within under MCA, any trial affect the proceedings parties’ consider court good and we for rights, may substantial cause remand this case
23 (1982), 198 Mont. Farm v.Blome Agency United proceedings. further Fruit 435, 438, 1205, also Cabalceta v. Standard P.2d 1207. See 646 (in (11th determining to 1553, 1555 whether 1989), 883 F.2d Co. Cir. record, supplement the equitable power to exercise its inherent issues, factors, circumstances evaluate all and appellate court should into record would the material the including accepting whether pending of the issue proper a doubt the resolution beyond establish justice to of and contrary remand would be the interests and whether (8th 1970), 429 F.2d economy); Turk v. United States Cir. judicial and (in may order 1327, justice appellate the the court 1329 interest of transcript testimony prelimi in to review in enlarged record order nary hearing). case, Maulding opportunity prepare for the
In this had full witnesses, his present Hardman’s and hearing, cross-examine at evidentiary is of an error the own evidence. There no claim Further, that evidence proceeding, transcript. and we see none importantly, motion. More necessary support for Hardman to his informed necessary decision is for this Court make that evidence Therefore, justice judicial on this matter. the interest presented July at the economy,this Court will consider the evidence a second hearing. 16 To remand this case to the District Court for hearing on motion would be nonsensical. turn to to set aside the default
We now
Hardman’s motion
60(b),
As a
governed by
That
Rule
M.R.Civ.P.
judgment.
motion
by
general rule,
judgments
cases are to
tried on the merits and
be
359,
(1984),
363,
v.
212 Mont.
default are not favored. Lords Newman
293;
290,
v. Real Bird
183
688 P.2d
Little Horn State Bank
208, 210,
1109,
made and
1110. Where the motion is
Mont.
doubt,
showing
minds in
responsible
a
that leaves
“supported
motion,
since
[those]
courts tend to resolve
doubts
favor
Twenty-
judgment.”
a default
courts favor a trial on
issues over
Street,
471, 716 P.2d
v.
Seventh
Inc.
Johnson
motion,
Furthermore,
if
had denied the
210, 211.
the District Court
denied,
would
be
allowing
than
it to be deemed
we
rather
in order to reverse
required
slight
to find a
abuse of discretion
Street, Inc.,
However, party seeking to set aside a a doing under Rule good a cause so must show both Cut Bank v. defense. First Nat’l Bank existence of a meritorious 335. We will discuss Mont. Springs defense, shortly. As for a meritorious requirement good cause Hardman testified at the that the car off simply slid the road gravel due to injured, loose and that no one was Higgins testified Forsina, the statement he took Dan non-party, cor- roborated Hardman’s Although version ofthe accident. the merits are finally trial, to be decided at Hardman has met his at burden this point. justification
Turning 60(b), now to the under Rule Hardman specifically (1), (3), cited subsections of that rule which provide: - - - 60(b). Rule Mistakes inadvertence neglect excusable -
newly fraud, discovered evidence etc. On and upon motion such terms as just, may are the court relieve a party party’s *6 legal from representative judgment, order, a final proceeding or for (1) following mistake, the inadvertence, reasons: or ex- surprise, (3) (whether neglect; cusable ... fraud heretofore denominated extrinsic), intrinsic or misrepresentation, other misconduct of (6) party;... any adverse justifying other reason from relief operation of the judgment. 60(b) “[t]he
Rule further provides that motion shall be made within (3) time, (1), (2), a reasonable and for reasons and when a defendant served, has personally days been ... not more than 60 after the judgment, order or proceeding was entered ....” (D.C.
Maulding Libby cites Rod & Gun Club v. Moraski Mont. 1981) F.Supp. said, 519 “[I]t where the court generally is held a party any that if seeks relief under other subsection of Rule 60(b)(6)” 60(b), it cannot also support argu- claim relief under his precluded ment Hardman claiming is from relief under subsec- (6). (1) (3) tion And relief because under subsections and is time barred, argues, he any Hardman is not entitled to relief at all under 60(b). However, Rule quote Libby the above from &Rod Gun Club is not a full or fair statement of as the law this Court views it. We stated our interpretation Springs:
Wright construing and Miller cite several federal cases Federal Rule 60(b), Rule, is identical state: which almost to Montana and (6) certainly
These cases seemed establish that clause and mutually five are and relief first clauses exclusive (6) had it cannot be under clause if would have been available also reading required under the earlier clauses. This seems language rule. agree Wright interpretation We with and Miller’s that relief cannot 60(b)(6), M.R.Civ.P., under Rule if that relief is avail- be obtained 60(b)(1) able under Rule to M.R.Civ.P. (citation omitted).
A motion under subsection must be “made within a 60(b), case, reasonable time.” Rule Higgins M.R.Civ.P.In this received a letter days entry from Doubek 60 after judgment informing him judgment, requesting payment, offering to settle the case $75,000 if paid immediately. timing We note that the of this letter prevented Hardman from claiming relief under the first three sub sections 60-day of Rule due to the requirement. The insurance company attorney hired an supporting who filed the motion and brief four later. The motion was made within a reasonable time and with due diligence under these circumstances. *7 60(b)(6)
We conclude that Hardman is entitled to relief under Rule for two reasons. The first reason is the manner in which Doubek handled this case. The second reason is the damages manner in which were established and awarded. This Court Marriage said In re Castor 249 Mont. of
495, 500,
665, 668,
817 P.2d
“Generally, relief is afforded under
60(b)
extraordinary
subsection
of Rule
cir
situations when
go beyond
cumstances
by
those covered
the first five subsections or
party
judgment
when a
in whose
im
favor
was entered has acted
In
properly.”
initially
this case Doubek
made a demand on the
insurance
a
company
requested
week after the accident and
a $75
However,
payment
a week after that.
documents he sent the
adjuster
copy
emergency
report
insurance
were a
of an
room
and a
copy
prescription.
give history
of a
These documents did not
a
of the
Higgins requested
copy
a
any
Although
other information.
injury or
why
or indicate
report, Doubek did not send one
highway patrol
of the
any further documentation to
provide
he could not. Nor did Doubek
Further,
Higgins’
return
claim.
he failed to
substantiate
this
sought payment
then
from
regarding
calls
this matter. He
telephone
although he
he had
a
company
the insurance
once
obtained
any
We realize that as
Higgins
proceedings.
did
inform
of
of the
not
the insurance
rule,
required
to inform
general
a
Doubek was
However,
of the in-
clearly
he
knew
proceedings.
of the
company
at all times
proceeded
interest in this lawsuit and
company’s
surance
once he
company
the insurance
eye
collecting
toward
with
recognized
Maulding.
previously
have
for
We
obtained
in a Rule
third
is to be considered
resulting
parties
prejudice
197 Mont.
Ring
See
v. Hoselton
motion.
(1970), 155 Mont.
1165;
Ming, Inc. v. District Court
John J.
We Co. Equipment Petrie Tractor & decision in Madson v. our lawyer parte in ex requires 1038. Rule 3.3 known of all material facts proceedings to inform the court vacated a they are adverse. In Madson we lawyer or not whether attorney speak did not plaintiff’s judgment partly because default stated there had attorney defendant’s who at a and correct up attorney Although plaintiff’s clients. process on his been no service had received because he that the defendant had been served knew entry of service, until he moved for he waited the sheriff’s return acknowledge it. policy insurance case, aware that an In the Doubek was present Dan Forsina’s by Higgins that claim, and he was informed covered the the accident. We Hardman’s version of statement corroborated ofthese facts. the District Court should have informed believe Doubek damages were in which the turn to the manner We now at the award case. We first look awarded in this established and District Court hearing, At the close of punitive damages. is based on an damages. This award $25,000 punitive awarded stated, uncertain as to “Plaintiff is allegation complaint in the the in while under operating his vehicle defendant was whether belief, alleges that said but, information upon alcohol fluence of his vehicle.” drinking driving prior had been defendant as a damages exemplary is ever entitled plaintiff “[N]o sufficiency of the situation right, regardless matter of
27
221,
P.2d
226.
(1988),
126,133,
234 Mont.
762
facts.”
v.
Davis Sheriff
a
27-1-221(5),
that all
of claim for
MCA, requires
elements
Section
evidence,
convincing
damages
proven by
be
clear
punitive
27-1-221(7)(b),
“clearly
state his
MCA, requires
judge to
Section
making
findings
in
of fact and conclusions of
reasons for
award
fac
law, demonstrating
of each of
enumerated
[nine
consideration
only
tors].”
evidence
here
an unsubstantiated claim
presented
The
requirement,
As to
reasons
complaint.
the second
Judgment
by
a
prepared
stated consist of
statement in the
Doubek
damages
by the
that “the evidence showed that the
sustained
Plaintiff
injury
by
operation
personal
were for
caused Defendant Hardman’s
of a
while
was intoxicated from
motor vehicle
Defendant Hardman
above,
Further,
using
As we said
there was no evidence.
this
alcohol.”
27-1-221(7)(b),
not satisfy
requirements
statement does
ofSection
Laboratories,
236
MCA. See Ward v. Vibrasonic
Inc.
Mont.
(district
314,
by
making findings
We next look at the the medical evidence was damages. give order to establish Doubek was allowed to an un- qualified medical expert opinion regarding Hardman’s condition and prognosis recovery. for District Court not have accepted The should testimony because, matters, this depend on these it should on 702, M.R.Evid.; qualified expert testimony. Rules 701 See Shah- Farm Co. v. State Mut. Auto. Ins. 194 Mont. rokhfar Sons, 653; Squibb Hill v. & E.R. 1383. that a hearing We conclude this was conducted as matter of form justice requiring over substance that would not be served this insurer damages Hardman or his to answer established manner. Maulding that he if the
Lastly, argues prejudiced would be However, were is no indication in the vacated. there any Maulding are or that record witnesses unavailable produce any will unable to documentation of the accident and be Furthermore, might any prejudice treatment he underwent. The rise to this Maulding. giving arise is attributable incident Although 1989. Doubek made September lawsuit occurred on later, a week he failed sub company demands on insurance this Higgins’ regarding the claim or to return calls matter. stantiate year half to file and another complaint He then waited for and a his nearly that to Hardman. Then he waited two days after serve entered. In requesting that Hardman’s default be months before January 1992 the court had to him prompt request hearing damages. finally This held and granted judg- the court ment on March 1992. Doubek then waited for two more months pass requesting before contacting execution be issued and before *9 Higgins. Any prejudice might that delay result from is attributable only Maulding. foregoing,
Based on the we vacate judgment the default and remand to the District Court for a trial on the merits. TURNAGE, CHIEF JUSTICE JUSTICES HUNT and
McDonough concur. dissenting. JUSTICE GRAY respectfully
I opinion majority. dissent from the The majority opinion strongly implies, quite saying without in so words, many that respondent Maulding’s engaged counsel in “sharp practices” view, in his I handling disagree. my of this case. do not It is however, that in its concern over counsel’s actions and its determina- right wrong, majority tion to fails to do an appropriate and 60(b)(6), M.R.Civ.R, precise analysis. Rule The result is a further clouding already murky guidance of a Rule so as to be of little trial reason, join courts and counsel. For this I majority cannot opinion. 60(b)(6) my
In opinion, appropriate analysis supports Rule setting entry aside the of default judgment damages by on the District Court. It does the setting not allow aside of the earlier default judgment liability on against appellant Hardman.
The critical challenge difference lies the fact that the to the on judgment liability grounded is on actions ofboth Hardman himself within Maulding’s bring squarely and (1) counsel which it subsections (3) 60-day brought and of the Rule. The limitation for motions pursuant expired January those subsections on or about — days judgment liability after the default on was entered Novem- challenge judgment damages, ber 1991. The to the default on on hand, legitimate “any pursuant the other is a other reason” motion 60(b)(6), premised significant irregularities to Rule as it is on at the Therefore, that made hearing damages. on motion need not have been days entry to the on subsequent within 60 damages on March 1992. analysis comports majority’s
This with the correct statement (6) relief under when the facts “party precluded from subsection of the first five bring or circumstances would the case under one (1) (3) were Here, under subsections motions subsections.” thus, entry judgment liability; on relating to the premised on events than 60 had made due to the fact more they timely were not the date the motions liability judgment from the time of elapsed were made. (6) however, facts motion, was based on different The subsection — surrounding damages
and circumstances
those
These facts and circumstances
the default
entered thereon.
Rule; thus,
the other subsections of the
do not fall within one of
(6).
relief under
This
precluded
Hardman is not
subsection
time” limitation
portion
timely
ofthe
under
“reasonable
motion —
—
60(b)(6)
properly
granted.
Rule
can and should be
motions
addition,
majority’s
Marriage
In
reliance on dicta from In re
495, 817
Castor
will haunt this Court
60(b)
Castor,
In
practice
long
Rule
for a
time to come.
we stated
under subsection
of Rule
“in
correctly that relief is afforded
extraordinary
go beyond
situations
circumstances
those
when
Unfortunately,
covered
the first five subsections ....”
we went on to
—
Castor,
say
needlessly,
erroneously,
under the facts of
both
*10
—
(6)
my view that relief was also available under subsection
“when
entered has acted
party
improperly.”
whose favor
was
Castor,
portion
It is view that the “when a whose favor 60(b)(6)applicability entered acted criterion for Rule improperly” has entirely clearly is Such considerations come within inappropriate. (3)’s “fraud..., misrepresentation, or other misconduct of subsection such, party” language. an adverse As motions on that basis would be judgment. By er- untimely brought unless within 60 applicability of subsec- roneously including language within (6) Castor, departed tion the Rule in we from the fundamental is not the facts requirement that subsection relief available when bring the case under one of the first five or circumstances would and Miller. appropriate Wright and from our reliance on subsections impossible apply for us to requirement That fundamental will be say straightforward refuse to in a manner long the future so as we Having joined language that the was erroneous dicta. quoted Castor error; my I wish that the opinion, willing in the I am to admit Castor salutary in order that majority would see fit to do same 60(b) can to be met. purposes of Rule continue Finally, majority appears to “believe”that Maulding’s counsel violated Rule 3.3 ofthe Rules of Professional majority Conduct. If the belief, sincere in this it appears to me that the Canons of Judicial may Ethics Commission require it to refer the matter to the referral, Practice. Absent question such a I whether statements about violations of the Rules of Professional Conduct appropriate have an place in our decisions. 60(b)(6)
I would reverse the denial of Hardman’s Rule motion and remand for proceedings further on damages. While this result might entirely insurer, not be “fair” to Hardman’s it preserve would integrity of Rule and provide appropriate and necessary guidance practitioners and trial courts.