US Bank National Ass'n v. Arnold

2001 ND 130, 631 N.W.2d 150, 2001 N.D. LEXIS 145, 2001 WL 789198
CourtNorth Dakota Supreme Court
DecidedJuly 13, 2001
Docket20010071
StatusPublished
Cited by26 cases

This text of 2001 ND 130 (US Bank National Ass'n v. Arnold) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
US Bank National Ass'n v. Arnold, 2001 ND 130, 631 N.W.2d 150, 2001 N.D. LEXIS 145, 2001 WL 789198 (N.D. 2001).

Opinions

SANDSTROM, Justice.

[¶ 1] Dennis Arnold1 appealed from an order denying his motion to vacate default judgment. Concluding the district court’s findings of fact were not clearly erroneous and the district court did not abuse its discretion in denying the motion to vacate default judgment, we affirm.

[152]*152I

[¶ 2] Arnold, who owned and operated Denny’s Lumber in Steele, North Dakota, was a longtime acquaintance of Roy Hack-man, then an 84-year-old resident of a Steele nursing home. In March 1999, Hackman issued a $50,000 check to Arnold, apparently as payment for Arnold to begin construction of a four-unit apartment building in Steele. After receiving the check, Arnold ordered materials, made arrangements with contractors, and prepared blueprints for the apartment.

[¶ 3] After discovering the $50,000 payment to Arnold, a social worker at Hack-man’s nursing home filed an ex parte petition for appointment of a guardian and conservator for Hackman. On .July 1, 1999, the district court appointed an employee of U.S. Bank (“the Bank”) as temporary guardian and conservator for Hack-man.

[¶ 4] On July 3, 1999, the Bank sent Arnold a letter advising him of the guardianship and instructing him to halt construction of the apartment until a meeting could be held. Arnold met with representatives of the Bank on July 13, 1999. Apparently, as a result of the meeting, further construction was not authorized. On November 20, 1999, Hackman died, and according to his will, the Bank was appointed personal representative of his estate.

[If 5) On August 11, 2000, the Bank sent Arnold a certified letter instructing him to repay $50,000 to Hackman’s estate or litigation would follow. Arnold received the letter but did not respond. The Bank sent a second certified letter, requesting that Arnold remove lumber from lots owned by the Bank. Arnold received the letter but again did not respond.

[¶ 6] The Bank initiated litigation, serving Arnold with a summons and complaint on September 12, 2000. Arnold did not file an answer or otherwise respond. The Bank applied for default judgment and notified Arnold of the application.2 On October 13, 2000, attorney Jerry Ren-ner telephoned attorney Michael Geier-mann, counsel for the Bank. Renner, after stating Arnold was in his office, inquired whether Geiermann had received an order for default judgment. Geiermann responded that the order was on the judge’s desk. The parties otherwise dispute the purpose, content, and general nature of the telephone conversation.

[¶ 7] Judgment by default was entered on October 18, 2000, and notice of entry of the default judgment was served on Arnold and Renner on October 19, 2000. Arnold moved to vacate the default judgment on October 30, 2000. In his affidavit in support of the motion to vacate default judgment, Arnold recited the details of his agreement with Hackman. Arnold also averred that in 1998 he was diagnosed as clinically depressed and in August 2000, under the direction of a physician, he was taking anti-depressant medication. Arnold attributed his depression to a series of traumatic events: in 1997 his wife was diagnosed with cancer, and his son committed suicide; in 1998 Arnold suffered a heart attack; and, in July 2000 his brother was diagnosed with terminal cancer.

[¶.8] Arnold also alleged that in his capacity as sole owner of Denny’s Lumber, he was overwhelmed with work between August and October of 2000 — the.period of the litigation. In his affidavit, Arnold admitted he did not respond to the summons and complaint “even though [he] disagreed with the allegations in the Complaint.” [153]*153Arnold alleged he “was not completely aware that [he] had been sued or that there could be any consequences if [he] did not respond to the Complaint.” Arnold also alleged that after meeting with Ren-ner and after contacting counsel for the Bank, he thought he “had three weeks to attempt to settle the matter.”

[¶ 9] On November 16, 2000, Arnold’s motion to vacate the default judgment was heard. On December 18, 2000, the district court denied the motion. Arnold’s appeal was timely. On appeal, Arnold alleges Renner’s telephone call to counsel for the Bank constituted an appearance, entitling him to eight days’ notice of the application for default judgment. Alternatively, Arnold argues the district court erred in concluding that excusable neglect had not been proven.

[¶ 10] The district court had jurisdiction under N.D.C.C. § 27-05-06. This Court has jurisdiction under N.D. Const, art. VI, § 6, and N.D.C.C. § 28-27-01.

II

[¶ 11] Arnold argues that attorney Renner’s telephone call to counsel for the Bank constituted an appearance, entitling him to notice before entry of default judgment. Arnold further argues that because he did not receive notice, the default judgment must be vacated. Rule 55(a)(3), N.D.R.Civ.P., provides, “If the party against whom judgment by default is sought has appeared in the action, the party ... must be served with written notice of the application for judgment at least 8 days before the hearing on the application.”

A

[¶ 12] “Whether particular conduct is an ‘appearance’ for purposes of NDRCivP 55 is a question of law.” Hatch v. Hatch, 484 N.W.2d 283, 286 (N.D.1992). A party must factually demonstrate an appearance in order to obtain relief from judgment. Id. In N.D.R.Civ.P. 55 cases in which the underlying facts used to support the conclusion of an appearance are undisputed, we address only the legal question of whether, as a matter of law, a party has appeared. See, e.g., Perdue v. Sherman, 246 N.W.2d 491, 494 (N.D.1976) (a telephone call constitutes an appearance when the attorney says he is appearing on behalf of a defendant and the plaintiff does not refute that statement). In cases similar to this one, this Court has reviewed the district court’s factual findings to determine whether particular conduct constitutes an appearance. See Wilson v. Wilson, 364 N.W.2d 113, 114-15 (N.D.1985) (discussing the district court’s findings of fact in relation to an appearance). If the district court’s interpretation of disputed facts is not clearly erroneous, we fully review whether the facts support the ultimate legal conclusion of an appearance. Cf. Wheeling v. Director, North Dakota Dep’t of Transp., 1997 ND 193, ¶ 5, 569 N.W.2d 273 (whether facts constitute probable cause is a fully renewable question of law).

[¶ 13] A finding of fact will be set aside on appeal only if it is induced by an erroneous view of the law, if no evidence exists to support it, or if the reviewing court, on the entire evidence, is left with a definite and firm conviction that a mistake has been made. Albrecht v. Metro Area Ambulance, 2001 ND 61, ¶ 6, 623 N.W.2d 367.

B

[¶ 14] Demonstrating a preference for adjudication of proceedings on the merits, this Court broadly interprets the term “appearance.” Federal Land Bank of St. Paul v. Lillehaugen, 370 N.W.2d 517, 519 (N.D.1985); Hatch, 484 N.W.2d at 285. A formal written document is not [154]*154required for an appearance, and this Court has recognized a telephone conversation may suffice as an appearance. Lillehaugen,

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Bluebook (online)
2001 ND 130, 631 N.W.2d 150, 2001 N.D. LEXIS 145, 2001 WL 789198, Counsel Stack Legal Research, https://law.counselstack.com/opinion/us-bank-national-assn-v-arnold-nd-2001.