September 23 2009
DA 09-0145
IN THE SUPREME COURT OF THE STATE OF MONTANA
2009 MT 312
MOBLEY AND SONS, INC.,
Plaintiff and Appellee,
v.
MATT WEAVER,
Defendant and Appellant.
APPEAL FROM: District Court of the Eighteenth Judicial District,
In and For the County of Gallatin, Cause No. DV-08-816C
Honorable John C. Brown, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
John H. Tarlow, Margaret C. Weamer, Tarlow Stonecipher & Steele,
PLLC, Bozeman, Montana
For Appellee:
Donald E. White, Attorney at Law, Bozeman, Montana
Submitted on Briefs: August 12, 2009
Decided: September 22, 2009
Filed:
__________________________________________
Clerk
Justice Patricia O. Cotter delivered the Opinion of the Court.
¶1 Mobley and Sons, Inc. sued Matt Weaver in the Eighteenth Judicial District Court
for Weaver’s alleged failure to pay for services rendered pursuant to a contract between
the parties. The District Court entered a default judgment against Weaver on the ground
that Weaver failed to file a timely response to Mobley’s Complaint. Weaver moved to
have the default judgment set aside and the District Court did not issue an order within 60
days; therefore, the motion was deemed denied. Weaver appeals. We reverse and
remand.
ISSUE
¶2 Did the District Court slightly abuse its discretion by denying Weaver’s motion to
set aside the default judgment?
FACTUAL AND PROCEDURAL BACKGROUND
¶3 Weaver is a shareholder and employee of Five Rivers, Inc., a corporation that
designs and constructs ponds, streams and wetlands. Mobley and Sons (Mobley) is a
Montana corporation that built ponds, installed power lines, dug ditches and performed
other construction work in Wyoming on a Five Rivers’ project in 2007. After Mobley
completed the work, Five Rivers made payments to Mobley for several months but,
according to Mobley, stopped making payments in June 2008, leaving an unpaid balance
of $65,467.11. In October 2008, Mobley filed a Complaint naming Weaver, rather than
Five Rivers, as the defendant, seeking payment of the above-referenced balance plus
interest. The parties dispute whether Five Rivers or Weaver is the proper defendant.
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Weaver claims the contract with Mobley was between Five Rivers and Mobley. Mobley
asserts that it contracted personally with Weaver.
¶4 Weaver was served with the Complaint on November 10, 2008, and had until
December 2, 2008, to file his answer. He failed to do so. On December 3, Mobley
moved for default judgment. Mobley’s attorney filed an affidavit in support of Mobley’s
motion for default judgment in which he claimed Mobley and Weaver entered into a
contract under which Mobley would perform the above-described work. Counsel also
stated in the affidavit that under the contract Mobley was to bill Weaver directly for time
and materials provided on the project and that Weaver failed to pay the billed amount.
The affidavit included a statement of “amount due” that included the alleged unpaid
balance, $272 in interest accrued from the last payment in June 2008 and $238 in costs,
for a total of $65,977.11. On December 3, the Clerk of the Eighteenth Judicial District
Court entered a default as well as the judgment by default against Weaver, ordering him
to pay $65,977.11, plus 10% per annum interest from the date of judgment.
¶5 On December 11, Weaver moved to set aside the default judgment and Mobley
filed a timely objection to the motion. On February 18, 2009, the District Court granted
Weaver’s motion. Mobley then challenged the District Court’s jurisdiction to enter its
February 18 order, arguing that the District Court lost jurisdiction of the matter on
February 9, 2009, sixty days after Weaver filed his motion to set aside the default
judgment. In response, Weaver filed an Emergency Motion to Reconsider, Remediate
Clerical Error Pursuant to Rule 60(a), or Alternatively Motion for Nunc Pro Tunc and
Brief in Support (Emergency Motion). Mobley then filed a special pleading in support of
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its challenge on March 4, 2009, arguing that under M. R. Civ. P. 59(d), the court was
required to rule on Weaver’s motion within 60 days. Mobley maintained that because the
District Court did not respond within 60 days, the motion was deemed denied and the
District Court no longer had jurisdiction over the matter.
¶6 Weaver, on the other hand, urged the District Court to exercise its authority to
“correct a clerical error” or utilize its “nunc pro tunc” authority, both of which could be
implemented by back-dating the order. Weaver asserted that such action was appropriate
because it was “indisputably” the court’s intention to meet the 60-day requirement.
¶7 The court held a hearing on Weaver’s Emergency Motion on March 4. On March
10, the District Court denied Weaver’s motion, set aside its February 18 order, and
reinstated the December 3 default judgment. It also denied Mobley’s request for attorney
fees and costs.
¶8 Weaver appeals the court’s March 10 order.
STANDARD OF REVIEW
¶9 We review a district court’s decision to grant or deny a motion to set aside an
entry of default for good cause under M. R. Civ. P. 55(c) under the slight abuse of
discretion standard. To determine whether good cause exists we consider the factors
originally set forth in Cribb v. Matlock Communications, Inc., 236 Mont. 27, 30, 768
P.2d 337, 339 (1989): (1) whether the default was willful, (2) whether the plaintiff would
be prejudiced if the default should be set aside, and (3) whether the defendant has
presented a meritorious defense to plaintiff's claim. The court must also balance the
interests of the defendant in the adjudication of his defense on the merits, against the
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interests of the public and the court in the orderly and timely administration of justice.
Legal Resources Agency, LLC v. Armstrong, 2008 MT 262, ¶¶ 18-19, 345 Mont. 115, 191
P.3d 368 (internal citations omitted).
DISCUSSION
¶10 Did the District Court slightly abuse its discretion by denying Weaver’s motion to
set aside the default judgment?
¶11 M.. R. Civ. P. 55(a) (Rule 55) provides that “[w]hen a party against whom a
judgment for affirmative relief is sought has failed to plead or otherwise defend as
provided by these rules and that fact is made to appear by affidavit or otherwise, the clerk
shall enter the party’s default.” Additionally, Rule 55(b) provides, in part, that “[w]hen
the plaintiff’s claim against a defendant is for a sum certain or for a sum which can by
computation be made certain, the clerk upon request of the plaintiff and upon affidavit of
the amount due shall enter judgment for that amount and costs against the defendant, if
the defendant has been defaulted for failure to appear . . . .”
¶12 The primary issue before us is the proper identity of the “party” and the
“defendant” as referenced in the above statutes. Mobley sought a judgment against
Weaver, individually, and argues on appeal the correctness of its position. Weaver
asserted to the District Court and to this Court that Five Rivers is the correct party
because Five Rivers contracted with Mobley, not Weaver, individually. Weaver
professes that Mobley misrepresented, or worse, fraudulently represented to the court that
Weaver was the proper party defendant. This misrepresentation or fraudulent
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representation, argues Weaver, justifies relief from the District Court’s March 10 order
reinstating the default judgment.
¶13 The documents Mobley filed with the District Court did indeed allege that Weaver
was the proper defendant. Certainly, had Weaver filed a timely response to Mobley’s
Complaint he would have addressed this issue but his failure to do so set in motion the
default followed by the District Court’s untimely ruling. We conclude, however, that the
untimely actions of Weaver and the District Court do not drive the outcome of this case.
¶14 As noted above, the clerk of court is authorized to enter a judgment by default
upon the filing of an affidavit for a sum certain. Rule 55(b). Mobley’s attorney
submitted an Affidavit in Support of Motion to Enter Default Judgment. This affidavit
asserted that Mobley, “a Corporation” and Weaver, “a resident of Gallatin County,
Montana,” entered into an agreement in May 2007. The affiant described the work that
Mobley would perform under this agreement as well as the billing arrangement
purportedly agreed upon by the parties. Mobley’s attorney continued in his affidavit that
Mobley properly submitted the invoices and Weaver failed to pay all of them. The
attorney set forth the unpaid amounts, including costs and calculated interest. Based
upon this affidavit, the Clerk of Court entered judgment by default and instructed Weaver
to pay the amount demanded.
¶15 We conclude Mobley’s attorney’s affidavit was flawed and therefore functionally
defective. Mobley’s attorney was not present at the time the parties discussed the
contract terms; therefore, he has no personal knowledge of the identity of the parties, the
job description the parties agreed upon, or the billing arrangements. While he stated in
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the affidavit that he was “familiar with the facts herein,” he was clearly testifying to
information provided by his client, the veracity of which he had no personal knowledge.
In Mountain States Resources, Inc. v. Ehlert, 195 Mont. 496, 503, 636 P.2d 868, 872,
(1981), we evaluated the sufficiency of an affidavit. We said:
An affidavit is defined as “a written statement, under oath, sworn to
or affirmed by the person making it before some person who has authority
to administer an oath or affirmation.” (Citations omitted.) The maker must
have personal knowledge of the information contained in the statement and
must swear to its validity.
See also McDermott v. Carie, LLC, 2005 MT 293, ¶ 26, 329 Mont. 295, 124 P.3d
168.
¶16 Here, Mobley’s attorney testified via affidavit to significant and disputed factual
issues well outside of his personal knowledge. This being so, we conclude that the
affidavit was improperly relied upon to support the entry of default judgment.
McDermott, ¶ 26 (improper affidavit cannot support bill of costs).
¶17 Finally, we note that the District Court correctly concluded it lost jurisdiction over
this matter on the day Weaver’s motion was deemed denied for the court’s failure to issue
a timely order. Having so concluded, the appropriate action would have been to simply
revoke its February 18 order. Upon such a revocation, Weaver was then free to appeal
the deemed denial of his motion. Given that the District Court was without jurisdiction,
it had no authority to reinstate the default judgment in any event.
CONCLUSION
¶18 For the foregoing reasons, we vacate the default judgment and reverse and remand
this matter to the District Court for further proceedings in accordance with this Opinion.
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/S/ PATRICIA O. COTTER
We concur:
/S/ JAMES C. NELSON
/S/ W. WILLIAM LEAPHART
/S/ JIM RICE
/S/ BRIAN MORRIS
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