No. 92-558
IN THE SUPREME COURT OF THE STATE OF MONTANA
1993
IN RE THE MARRIAGE OF
DAVID JOHN WHITING,
Petitioner and Respondent,
and
ROBIN RENE WHITING,
Respondent and Appellant.
APPEAL FROM: District Court of the Twentieth Judicial District,
In and for the County of Lake,
The Honorable C. B. McNeil, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
John E. Smith, Attorney at Law, Missoula, Montana
For Respondent:
Keith W. McCurdy; McCurdy Law Firm, Polson, Montana
Submitted on Briefs: May 20, 1993
Decided: June 2 3 , 1993
Justice John Conway Harrison delivered the Opinion of the Court.
Robin Rene Whiting (Rene) appeals from a default decree of
marital dissolution entered on August 21, 1992, by the Twentieth
Judicial District Court, Lake County, the Honorable C. B. McNeil
presiding. The decree divided the marital estate and awarded the
parties joint custody with equal physical custody of their minor
child. We reverse and remand.
Rene and David Whiting were married on April 18, 1988, in
Coeur d1Alene, Idaho. David petitioned for legal separation in
August 1989, and for marital dissolution in January 1990. Rene
moved to dismiss for failure to state a claim in February 1990:
this motion was denied for lack of a supporting brief. No further
proceedings took place until David filed an amended petition for
marital dissolution on July 23, 1992.
In the meantime the parties reconciled temporarily and had a
daughter, Kalani, born September 10, 1991. At the time he filed
his amended petition, David was working as a roofer and Rene was
working as a janitor. The couple lived in Pablo, Montana. They
had acquired three lots in different subdivisions and owned several
vehicles.
In his amended petition for dissolution David requested sole
custody of the child, with Rene to visit on alternate weekends and
on Wednesday evenings. He requested all of the real property, in
exchange for payment to Rene of half the net equity, or $16,630, in
installments over a five-year period. He also asked for a hearing
to show cause, having filed an affidavit stating that Rene had
2
physical custody and that he had been informed that she intended to
take the child out of the state. A hearing was set for August 5,
1992, but was later vacated at the request of David's lawyer.
Copies of the amended petition and the order to show cause
were served on Rene by a Lake County deputy sheriff on July 25,
1992. A copy of the petition was mailed to Renels attorney of
record, Greg Ingraham, who had prepared her motion to dismiss in
response to David's original petition.
David and Rene then attempted to negotiate the terms of the
dissolution directly. They agreed on a distribution of assets and
debts but not on custody, visitation and child support. On August
11, 1992, David advised his lawyer that a negotiated settlement was
not possible and asked him to proceed with the dissolution. On the
following day his lawyer filed a "Notice of Intention to Proceed,"
which stated that David intended to proceed with the dissolution of
his marriage and that Rene:
must comply with the terms of the Summons heretofore
served on her on July 25, 1992 or Judgment will be taken
against her in accordance with the prayer of the Amended
Petition for Dissolution of Marriage served on her on
July 25, 1992.
Copies of this notice were mailed to Rene and to Greg Ingraham on
August 11, 1992
Upon receiving the Notice of Intention to Proceed on August
12, 1992, Ingraham wrote to David's lawyer, Keith McCurdy, saying
that he was no longer representing Rene. McCurdyls office received
the letter on August 17, 1992.
Rene received the notice on Monday, August 17, 1992. She
telephoned McCurdy on Tuesday, August 18, to find out what it
meant. What McCurdy said is in dispute. Rene later stated that he
told her she had "until Wednesdayw (i-e., August 19) to respond to
the amended petition. McCurdy said during oral argument that he
had told Rene the matter was "going to court at ten o'clock in the
morning and that if she wanted to contest it, she had to get an
appearance filed by herself or by her attorney prior to that time."
No notice of the hearing that took place on August 19, 1992,
appears in the record.
David and Rene met by appointment on Tuesday, August 18, 1992,
to discuss the dissolution. They failed to resolve their
differences, and Rene told David that she intended to contact her
lawyer. David did not tell Rene that he was scheduled to appear in
court on the following morning, Wednesday, August 19. Believing
that she had until 5:00 p.m. on Wednesday to file an answer to the
amended petition, Rene consulted Ingraham that morning. He
prepared the answer she filed late on Wednesday afternoon. By
then, the court had issued a minute order, stating that Rene was
"noticed" about the hearing but was not present and ordering
default entered. The court found that the marriage was
irretrievably broken and approved the child custody, child support,
and property division as prayed for.
A decree of dissolution, prepared by McCurdy, was filed two
days later, on August 21, 1992. It divided the parties' real and
personal property, giving Rene a choice of their three parcels of
real estate and providing for cash payments to equalize their
shares of the net equity. The decree awarded the parties joint
custody of their child, with each party to have physical custody
one week at a time, for alternating weeks. Finding that David's
income was $14,000 annually and that Rene's income was $12,000
annually, the court awarded Rene child support in the amount of
$100 per month and assigned each party equal responsibility for the
child's uncovered medical expenses.
Substitution of counsel for Rene was filed on August 24, 1992.
On August 26, 1992, her new lawyer, Shawn Rosscup, filed a motion
to set aside the default decree of dissolution. The motion was
based primarily on David's failure to provide notice of application
for default judgment as required by Rule 55(b)(2), M.R.Civ.P. It
also alleged misconduct by David, because he negotiated wiCh Rene
on August 18 without telling her that he intended to appear in
court the following day, and because he testified during that
appearance that the parties were in agreement concerning property
division, custody, and child support, when in fact they had agreed
only on a division of property, one that differed from the
distribution ordered in the decree.
David's response to this motion asserted that he was not
obligated by Rule 55(b) (2), M.R.Civ.P., to provide notice of his
intention to apply for a default judgment, because Rene had not
"appeared" by responding to the amended petition for dissolution.
After hearing oral argument, without testimony, on September 17,
1992, the District Court denied Rene1s motion to set aside the
decree.
The dispositive issue on appeal is whether the District Court
abused its discretion in refusing to set aside the default decree
of dissolution. As we reverse on that issue alone, we need not
address the child support and custody issues raised by Rene.
Rene argues that the District Court should not have entered a
default decree of dissolution, or judgment, against her because she
received no notice of the August 19, 1992 hearing. She concedes
that notice of entry of default was not required, but argues that
Rule 55(b) ( Z ) , M.R.Civ.P., requires three days notice before the
default is made a judgment. The relevant portion of Rule 55(b) (2),
M.R.Civ.P., follows:
If the party against whom judgment by default is sought
has appeared in the action, the party . .
. shall be
served with written notice of the application for
judgment at least 3 days prior to the hearing on such
application.
At the hearing on Rene1s motion to set aside the decree, the
District Court ruled that Rene was not entitled to notice because
she had not filed an answer to David's amended petition. David
adopts this proposition in his brief, arguing also that his Notice
of Intention to Proceed was served on Rene by mail on August 11,
1992, eight days prior to entry of default, and that she therefore
had ample time to answer his amended petition.
We hold that the District Court erred in ruling that Rene had
not appeared in the action. Rene appeared when her then counsel,
Greg Ingraham, filed a motion to dismiss David's original petition
for marital dissolution, on February 14, 1990. See In re Marriage
of Neneman (1985), 217 Mont. 155, 703 P.2d 164, in which we held
that the wife's failure to appoint counsel or otherwise appear in
response to the husband's request that she do so by a certain date
did not constitute failure to appear in the action, and that she
therefore was entitled to notice under Rule 55(b)(2), M.R.Civ.P.
Here, David's "Notice of Intention to Proceed" does not
constitute the notice required by Rule 55(b)(2), M.R.Civ.P. While
it warned Rene that judgment would be taken against her, it said
nothing about any proceedings in court and did not indicate the
date, time and place of such proceedings. Nor does it fulfill the
notice requirement of § 37-61-405, MCA, which provides in pertinent
part that:
When an attorney . ..
ceases to act as such, a party to
an action for whom he was acting as attorney must, before
any further proceedings are had against him, be required
by the adverse party, by written notice, to appoint
another attorney or appear in person.
We have interpreted this statute to mean that unless the
prescribed notice has been given, no proceedings may be had against
an unrepresented party, and no judgment may be taken. Montana Bank
of Roundup v. Benson (1986), 220 Mont. 410, 717 P.2d 6, quoting
Endresse v. Van Vleet (1946), 118 Mont. 533, 169 P.2d 719. We have
said also that the notice must set forth the date of the next
hearing or action in the matter pending. Neneman, 703 P.2d at 166,
quoting McPartlin v. Fransen (1978), 178 Mont. 178, 185, 582 P.2d
1255, 1259.
Here, the record shows that David's lawyer knew or should have
known by August 17, 1992, that Rene was not represented by counsel.
As we hold that the "Notice of Intent to Proceedw that McCurdy
mailed to Rene on August 11 did not constitute notice that David
would apply for default judgment on August 19, 1992, we conclude
that the default judgment entered against Rene was premature and
voidable. See Neneman, 703 P.2d at 167.
Entry of default, as opposed to a default judgment, may be set
aside for good cause shown. Rule 55(c), M.R.Civ.P.; Cribb v.
Matlock Communications, Inc. (1989), 236 Mont. 27, 30, 768 P.2d
337, 339. Rene should have been given notice of the impending
default in time to prepare a defense that would meet the "good
cause" standard defined in m, that is, by showing that her
failure to respond was not willful; that David would not be
prejudiced if the default were set aside; and that she had a
meritorious defense. m,768 P.2d at 339.
We conclude that Rene would have met the "good causen standard
for setting aside entry of default if she had been properly
notified and given an opportunity to move to set aside the default.
Her default was not willful, because she had tried to resolve
dissolution issues with David for weeks preceding the default, and
because she tried to meet what she understood to be the deadline
for answering the amended petition. Moreover, her objections to
equal physical custody constitute a meritorious defense. Finally,
David has not shown that he would have been prejudiced by setting
aside the default. See Hoyt v. Eklund (1991), 249 Mont. 307, 815
P.2d 1140 (district court should have vacated default because
defendant's attorney had not been notified that plaintiff had begun
an action against his client).
As Rene had no opportunity to resist the entry of default,
however, she must meet the more exacting Rule 60(b) standard
imposed by Rule 55(c), M.R.Civ.P., for setting aside a default
judgment. Cribb, 768 P.2d at 339. She argues that she has met
this standard and that the judgment should be vacated under Rule
60(b) (1), M.R.Civ.P., because her failure to file a timely response
to the amended petition was due to excusable neglect, and under
Rule 60(b)(3), M.R.Civ.P., because David misrepresented to the
court their agreed property settlement, as well as the extent of
their agreement on child custody and visitation.
We agree that Rene's failure to respond to the petition was
due to excusable neglect, especially in view of her lack of
representation. See Little Horn State Bank v. Real Bird (19791,
183 Mont. 208, 598 P.2d 1109, in which we reversed the district
court's refusal to set aside a default judgment despite evidence
that the defendant had relied on assurances that she would have
time to negotiate a settlement before action was taken against her.
As excusable neglect alone justifies relief from judgment under
Rule 60(b)(l), M.R.Civ.P., we do not address Rene's Rule 60(b)(3)
argument.
In reviewing a default judgment, we are guided by the
principle that every litigated case should be decided on its
merits; judgments by default are not favored. Lords v. Newman
(1984), 212 Mont. 359, 688 P.2d 290. When appeal is from a denial
of a motion to set aside a default judgment, our standard of review
is that only slight abuse of discretion need be shown to warrant
reversal. Lords, 688 P.2d at 293; Blume v. Metropolitan Life
Insurance Co. j1990), 242 Mont. 465, 791 P.2d 784.
Moreover, we have consistently held that any doubt as to the
late filing of an answer should be resolved by trial on the merits.
Cure v. Southwick (l96O), 137 Mont. 1, 349 P.2d 575 (affirming a
district court order that vacated a default decree of divorce);
Duffey v. Duffey (1981), 193 Mont. 241, 631 P.2d 697 (affirming a
district court's decision to extend a parent's deadline for filing
proposed findings and conclusions in an action to modify custody,
child support and visitation, over the other parent's objections:
we noted that "custody cases present a compelling reason for a
hearing on the meritsw).
In keeping with these precedents, we conclude that the
District Court abused its discretion in denying Rene8s motion to
set aside the default decree of dissolution. We vacate the default
decree and remand the case to the District Court for further
proceedings in accord with this opinion.
We concur:
Chief Justice
June 23, 1993
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by United States mail, prepaid, to the following
named:
John E. Smith
Attorney at Law
222 East Pine
Missoula, MT 59802
Keith W. McCurdy
McCurdy Law Firm
P. 0 . Box 1172
Polson, MT 59860
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTANA