Opinion
No. C2-99-1227.
Filed March 14, 2000.
Appeal from the District Court, Koochiching County, File No. C796123.
Steven A. Nelson, (for appellant)
Daniel L. Griffith, (for respondents)
Considered and decided by Willis, Presiding Judge, Kalitowski, Judge, and Halbrooks, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1998).
UNPUBLISHED OPINION
Appellant Warren Norgart challenges the district court's decision to vacate a default judgment based on a finding of excusable neglect. Because we conclude that respondent Brian Werner demonstrated a reasonable defense on the merits, offered a reasonable excuse, and acted with due diligence, and that Norgart will not be prejudiced, we affirm the district court's decision not to vacate the default judgment.
FACTS
Appellant Warren Norgart alleges he was attacked by respondent Brian Werner on January 15, 1993, outside the Ranier Liquor Store. Norgart subsequently commenced an action against the city of Ranier, d/b/a Ranier Liquor Store, and Werner.
Upon receiving notice of the lawsuit, Werner retained an attorney to represent him. His attorney served an answer and cross-claim dated March 24, 1995. Based on his attorney's advice that the Ranier Liquor Store was the principal defendant, Werner discharged him on September 19, 1995. Prior to his discharge, Werner's attorney informed the court and opposing counsel that Werner's address was 3190 Meadowbrook Court, Vadnais Heights, Minnesota.
On December 8, 1995, Werner was deposed in Minneapolis. At the deposition, the attorney for Ranier Liquor Store asked whether Werner's current address was 3190 Meadowbrook Court, Vadnais Heights, MN, and Werner responded in the affirmative. Respondent was then asked if he was going to be there for the foreseeable future, and he replied, "For a few months." Later in the deposition, Werner stated his permanent address was his parents' address at 1606 Tenth Avenue, International Falls, Minnesota. He then stated, "That's the mailing address I use for just about everything because I don't know where I'm going to be."
All future notices in the lawsuit were served on Werner at the Vadnais Heights address, including the notices of taking deposition of Norgart and a witness and the order scheduling the action for trial on September 16, 1998. Unbeknownst to the other parties, Werner moved to International Falls in approximately 1996. As a result, he did not receive or respond to any of the notices.
According to Werner, the last time he received service, correspondence, or notices concerning the case was at the time of his deposition in 1995. He, therefore, believed the case was over. Three years later, in December 1998, Werner was served with a garnishment notice at his International Falls address for a default judgment of $50,000.
After learning of the default judgment, Werner contacted another attorney. On December 31, 1998, Werner's attorney requested a copy of the file from Norgart's attorney. Werner subsequently served Norgart with a motion to vacate the default judgment on February 22, 1999, and on May 10, 1999, the district court granted Werner's motion. This appeal followed.
DECISION
A default judgment may be entered against a party who fails to plead or otherwise defend in the time allowed by law. Minn.R.Civ.P. 55.01. Vacation of default judgments is governed by Minn.R.Civ.P. 60.02, which states in relevant part:
On motion and upon such terms as are just, the court may relieve a party or the party's legal representatives from final judgment * * * and may order a new trial or grant such other relief as may be just for the following reasons:
(a) Mistake, inadvertence, surprise, or excusable neglect.
A party seeking relief under rule 60.02 must demonstrate (1) a reasonable case on the merits, (2) a reasonable excuse for the failure to act, (3) that he acted with due diligence after notice of the entry of judgment, and (4) that there will be no substantial prejudice to the opposing party if the motion to vacate is granted. Finden v. Klaas, 268 Minn. 268, 271, 128 N.W.2d 748, 750 (1964). The moving party bears the burden of proving all four of the elements, including lack of prejudice. Nelson v. Siebert, 428 N.W.2d 394, 395 (Minn. 1988). Relative weakness on one factor may be offset by a strong showing on the other factors. Armstrong v. Heckman, 409 N.W.2d 27, 29 (Minn.App. 1987), review denied (Minn. Sept. 18, 1987).
Default judgments are to be "liberally" reopened to promote resolution of cases on the merits. Galatovich v. Watson, 412 N.W.2d 758, 760 (Minn.App. 1987). But the decision to open a default judgment rests within the district court's discretion and will not be reversed absent an abuse of discretion. Kosloski v. Jones, 295 Minn. 177, 180, 203 N.W.2d 401, 403 (1973). The record is viewed in the light most favorable to the district court's order. Bentonize, Inc. v. Green, 431 N.W.2d 579, 582 (Minn.App. 1988).
In the instant case, Norgart claims Werner has failed to carry his burden of proof on all four elements of the Finden test and, therefore, the district court abused its discretion in opening the default judgment. After a careful review of the record in this case, we conclude the district court did not abuse its discretion in finding that Werner demonstrated each of the elements of the Finden test.
We are, however, troubled by the district court's statements that Norgart's attorney, Steven Nelson,
was aware of the defendant's presence in [Koochiching County], and the address at which the defendant could be reached. Attorney Nelson chose, however, to send notice only to the defendant's Vadnais Heights address.
* * * Attorney Nelson had actual knowledge of the defendant's current address, and had in fact caused him to be contacted at that address on unrelated legal matters. The defendant knew Attorney Nelson knew his current address * * * .
We have found nothing in the record to support these statements and do not adopt them. There is no evidence that Nelson had knowledge of respondent's current address prior to the scheduled trial date and acted intentionally to thwart proper service of case-related documents.
Respondent, whether pro se or represented by counsel, had a responsibility to update the parties and the court with his current address and failed to do so. Nevertheless, because respondent has met his burden under Finden, we affirm the district court's decision to vacate the default judgment.
1. Case on the merits
Before relief will be granted under rule 60.02, the moving party must "establish to the satisfaction of the court that it possesses a meritorious claim." Charson v. Temple Israel, 419 N.W.2d 488, 491 (Minn. 1988). Here, Norgart sued Werner for assault and battery. At the hearing to vacate the default judgment, Werner presented the court with his affidavit and deposition testimony stating he was attacked by Norgart and only acted in self-defense. Werner also submitted the law enforcement center report, which included an interview with a witness to the incident. The witness told the deputy that Norgart instigated the fight. Additionally, law enforcement who investigated the incident chose not to press charges against Werner for assault and battery. Thus, the district court did not abuse its discretion in concluding that Werner established a reasonable defense on the merits to Norgart's assault-and-battery claim. See Finden, 268 Minn. at 271, 128 N.W.2d at 750 (stating defendant's assertion of self-defense in his proposed answer is a reasonable defense on the merits to an assault claim).
2. Reasonable excuse
We believe Werner's excuse for not appearing to defend the suit is weak and Werner should have notified the court and parties of his address change. We are nevertheless compelled to conclude the district court did not abuse its discretion in finding Werner met this element. At his December 1995 deposition, Werner informed the other parties to the suit that his Vadnais Heights address was temporary and gave them his permanent address. Thus, following the deposition, they should have been aware of his permanent address. Werner's actions in hiring an attorney when he was served with the suit, filing an answer, and attending his deposition should also have indicated to the other parties that Werner intended to defend the suit.
Moreover, we have previously excused the negligence of a pro se defendant presenting an excuse similar to Werner's. For instance, in Galatovich, this court held a pro se defendant's belief that his verbal response to plaintiff's attorney was an adequate answer and that he would receive notice of the trial date was weak but met the reasonable-excuse requirement. 412 N.W.2d at 760-61.
3. Due diligence
We also conclude that Werner acted with due diligence after he discovered the default judgment. Only five months elapsed between the time the judgment was entered and the date he filed a motion to vacate it, and only two months passed between the time Werner actually received notice of the judgment and the date he filed his motion. In the interim, he took steps, through his attorney, to verify the merits of the default judgment.
Thus, the district court did not abuse its discretion in determining that the due-diligence factor was satisfied . See Sommers v. Thomas, 251 Minn. 461, 467, 88 N.W.2d 191, 195 (1958) (holding reasonable time is determined on a case-by-case basis); see also Galatovich, 412 N.W.2d at 760 (holding due-diligence prong was met where defendant contacted attorney upon receipt of default judgment, attorney sought to resolve matter, and filed motion to vacate judgment five months after its entry).
4. Prejudice
Finally, we conclude the district court did not abuse its discretion in finding that reopening the default judgment would not prejudice Norgart. The only prejudice Norgart alleges is the prejudice inherent in opening any judgment. In the context of rule 60.02, the delay and expense of additional litigation, without more, do not create sufficient prejudice to defeat a motion to vacate. Charson, 419 N.W.2d at 491.
In sum, although Werner's failure to receive notice of the trial is partly attributable to his failure to inform the court of his International Falls address, we conclude the district court did not abuse its discretion in finding this was excusable neglect. The other attorneys had some knowledge of Werner's permanent address and knew of his intention to defend the action. Moreover, Werner has met the other three prongs of the Finden test and our caselaw indicates that a strong showing on three factors may offset relative weakness on one factor. See, e.g., Armstrong, 409 N.W.2d at 29; see also Valley View, Inc. v. Schutte, 399 N.W.2d 182, 185-86 (Minn.App. 1987) (noting this court has twice reversed a trial court's denial of a motion to vacate a default judgment where the defaulting party's weak excuse for failing to answer the lawsuit was outweighed by a strong showing on the three remaining factors), review denied (Minn. Mar. 18, 1987). Accordingly, we affirm the district court's order vacating the default judgment.