Peak Development, LLP v. Juntunen

2005 MT 82, 110 P.3d 13, 326 Mont. 409, 2005 Mont. LEXIS 88
CourtMontana Supreme Court
DecidedMarch 31, 2005
Docket04-088
StatusPublished
Cited by11 cases

This text of 2005 MT 82 (Peak Development, LLP v. Juntunen) is published on Counsel Stack Legal Research, covering Montana Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Peak Development, LLP v. Juntunen, 2005 MT 82, 110 P.3d 13, 326 Mont. 409, 2005 Mont. LEXIS 88 (Mo. 2005).

Opinions

JUSTICE RICE

delivered the Opinion of the Court.

¶1 Jeremy Juntunen (Juntunen) appeals from the order entered in the Eleventh Judicial District Court, Flathead County, denying his motion to set aside the entry of a judgment of default against him and ordering him to pay $64,121.85 in damages. We affirm.

¶2 We restate the issue on appeal as follows:

¶3 Did the denial of Juntunen’s motion to set aside the entry of the default judgment constitute an abuse of discretion?

FACTUAL AND PROCEDURAL BACKGROUND

¶4 On July 2, 2003, Peak Development, LLP (Peak) filed a civil suit [411]*411in the Eleventh Judicial District Court alleging that Juntunen breached a lease agreement and claiming $64,121.85 in damages for unpaid rent and utility bills associated with the lease.

¶5 On July 22,2003, Juntunen was personally served with a copy of the summons and complaint. Juntunen is the owner of the Bear Naked Paving Company in Kalispell, Montana. The summons advised Juntunen that “in case of your failure to appear or answer, judgment will be taken against you, by default, for the relief demanded in the Complaint” within twenty days after service of the summons. However, Juntunen did not file an answer as directed by the summons, and Peak’s attorney filed a praecipe for default, which the clerk of the court entered on August 14, 2003.

¶6 In September 2003, Juntunen’s company began paving a parking lot for the law firm of Quatman & Quatman. Working at the law office brought to Juntunen’s mind that he had been served with the summons and complaint, and he requested attorney John Quatman (Quatman) to inquire into the matter on September 16,2003. Quatman did so, and discovered the default which had been entered in August. He then apprised Juntunen of the situation, and, on October 3, 2003, filed a motion to set aside the default. However, on September 12, 2003, Peak had already filed a motion for default judgment, and further, on September 24, 2003, the District Court had conducted a hearing on Peak’s motion and entered a default judgment against Juntunen. Peak responded to Juntunen’s motion to set aside default on October 10, 2003, arguing that the motion was not well taken because the court had already entered a default judgment. Quatman then filed, on October 17, 2003, a motion seeking to set aside the default judgment pursuant to Rule 60(b)(1) and (6), M.R.Civ.P. Quatman argued in his supporting brief that at the time Peak had served the summons and complaint, Juntunen’s hectic business schedule contributed to his inadvertence in failing to file an answer. Included in Juntunen’s affidavit, though not argued to the District Court in the motion, was this statement:

During this same period of time my wife and I separated and I was arrested for a fight I had with her father.

¶7 The District Court did not rule on the motion to set aside the judgment within sixty days, and therefore it was denied by operation pursuant to Rule 60(c), M.R.Civ.P. Juntunen appeals therefrom.

STANDARD OF REVIEW

¶8 In reviewing a default judgment, we are guided by the [412]*412principle that every litigated case should be decided on its merits; judgments by default are not favored. In re Marriage of Whiting (1993), 259 Mont. 180, 186, 854 P.2d 343, 347. When an appeal is from a denial of a motion to set aside a default judgment, our standard of review is that only a slight abuse of discretion need be shown to warrant reversal. Lords v. Newman (1984), 212 Mont. 359, 364, 688 P.2d 290, 293. The party seeking to set aside a default judgment has the burden of proof. In re Marriage of Winckler, 2000 MT 116, ¶ 10, 299 Mont. 428, ¶ 10, 2 P.3d 229, ¶ 10.

DISCUSSION

¶9 Did the denial of Juntunen’s motion to set aside the entry of the default judgment constitute an abuse of discretion?

¶ 10 Juntunen argues that his motion to set aside the default judgment should have been granted because, first, his motion satisfied the good cause criterion under Rule 55(c), M.R.Civ.P., and, secondly, satisfied the more stringent excusable neglect standard under Rule 60(b)(1), M.R.Civ.P. Further, Juntunen contends that the facts establish extraordinary circumstances which justify setting aside the default judgment pursuant to Rule 60(b)(6), M.R.Civ.P.

¶11 Recently, in Essex Ins. Co. v. Jaycie, Inc., 2004 MT 278, 323 Mont. 231, 99 P.3d 651, we clarified the respective standards tó be applied in determining whether to set aside the entry of a default or a default judgment. Essex, ¶ 12. We held that when the issue is setting aside an entry of a default under Rule 55(c), M.R.Civ.P., we will apply the Cribb standard. Essex, ¶ 10 (referencing Cribb v. Matlock Communications, Inc. (1989), 236 Mont. 27, 30, 768 P.2d 337, 339, and noting that “to evaluate a showing of good cause [to set aside a default,] the Court should consider: (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 plaintiffs claim”). However, when the issue is the setting aside of an entry of a default judgment under Rule 60(b)(1), M.R.Civ.P., either alone or in conjunction with an entry of default, we will apply the Blume standard. Essex, ¶ 12 (referencing Blume v. Metro. Life Ins. Co. (1990), 242 Mont. 465, 467, 791 P.2d 784, 786). We clarified that the criteria which must be satisfied by a defaulting party to set aside a default judgment are as follows:

(1) the defaulting party proceeded with diligence; (2) the defaulting party’s neglect was excusable; (3) the defaulting party has a meritorious defense to the claim; and (4) the judgment, if [413]*413permitted to stand, will affect the defaulting party injuriously.

Essex, ¶ 11.

¶12 Essex was decided while this case was pending, and the parties did not have the benefit of our holding for their briefing. Nonetheless, both parties have offered arguments in accordance with the Blume standard for setting aside a default judgment and, therefore, have provided an appropriate analysis, consistent with Essex, for our consideration.

¶13 Juntunen argues that his failure to file an answer to Peak’s complaint was not an intentional disregard for the judicial process, but a consequence of his schedule during this time, noting that he had too much on his plate. He explains that the summer months are the make-it or break-it season for his company, requiring him to work in excess of 100 hours per week, because asphalt batch plants only operate when the temperature is warm. He also offers that, during this period of time, he determined to separate from his wife and was arrested for an altercation with his father-in-law.

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Peak Development, LLP v. Juntunen
2005 MT 82 (Montana Supreme Court, 2005)

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Bluebook (online)
2005 MT 82, 110 P.3d 13, 326 Mont. 409, 2005 Mont. LEXIS 88, Counsel Stack Legal Research, https://law.counselstack.com/opinion/peak-development-llp-v-juntunen-mont-2005.