Title: John N. Bach v. Katherine D. Miller and Alva Harris Appeal from the district courts refusal to set aside default & judgment

State: idaho

Issuer: Idaho Supreme Court (civil)

Document:

IN THE SUPREME COURT OF THE STATE OF IDAHO 
 
Docket No. 31716 
 
 
JOHN N. BACH,                                           
                                                        
          Plaintiff-Respondent,           
               
v.                                                      
                                                        
KATHERINE D. MILLER, aka 
KATHERINE M. MILLER, dba R.E.M.; 
BOB BAGLEY and MAE BAGLEY, husband 
and wife; GALEN WOELK and CODY 
RUNYAN, individually, dba RUNYAN & 
WOELK; ANN-TOY BROUGHTON; 
WAYNE DAWSON; MARK LIPONIS; 
EARL HAMBLIN; STAN NICKELL; BRET 
HILL and DEENA R. HILL; and DOES 1 
through 30, inclusive,                           
                                                        
          Defendants,                                   
 
and   
 
ALVA HARRIS, individually, dba SCONA, 
INC.; JACK LEE McLEAN and BOB 
FITZGERALD, individually, dba CACHE 
RANCH; OLE OLESON; BLAKE LYLE, 
individually, dba GRAND TOWING,                                         
                                                      
          Defendants-Appellants.                           
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Boise, January 2010 Term 
 
2010 Opinion No. 8 
 
Filed:  January 29, 2010 
 
Stephen W. Kenyon, Clerk 
 
Appeal from the District Court of the Seventh Judicial District of the State of Idaho, 
Teton County.  The Honorable Richard T. St. Clair, District Judge. 
 
The judgment of the district court is affirmed. 
 
Alva A. Harris, Shelley, for appellants. 
 
John N. Bach, Driggs, respondent pro se.  
________________________ 
 
 
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J. JONES, Justice.  
 
 
This is an appeal of the district court’s refusal to set aside a default and judgment by 
default against the appellants. We affirm.  
I. 
Factual and Procedural Summary 
 
Between 1992 and 2000, John N. Bach acquired various interests in real property in 
Teton County under variations of the name “Targhee Powder Emporium.” However, he took no 
action to establish a separate legal entity in that name or to file an assumed business name 
certificate until 2007. Bach also purported to acquire some interests in real property on behalf of 
the Vasa N. Bach Family Trust, which was established by Bach’s mother in 1993 with Bach as 
the trustee. Bach treated all acquired property interests as his personal property, even executing 
assignments on behalf of these entities to himself in a personal capacity.  
 
As a result of his acquisition and use of these interests, Bach’s relationship with several 
neighboring land owners and other Teton County residents, including Alva M. Harris; Scona, 
Inc.; Bob Fitzgerald; Ole Oleson; Blake Lyle; and Jack McLean1 (appellants), deteriorated, 
culminating in a series of altercations that Bach characterized as “raids” on his property. There is 
evidence in the record that some of the appellants did enter upon real property which Bach 
occupied and carry away or cause damage to his personal property, resulting in the district 
court’s entry of a preliminary injunction. There is also some evidence that threats were made 
against Bach by some of the appellants and vice-versa. However, it appears that a number of the 
“raids” resulted from actions taken by Bach to block Katherine Miller’s access to a parcel of 
property purported to be jointly owned by Bach and Miller, as well as another parcel held solely 
by Miller. Also, apparently prompted by Bach’s actions, Miller, McLean, Mark Liponis, and 
Alva Harris joined together to form an incorporated entity known as Targhee Powder Emporium, 
Inc., that they subsequently used to deed land interests Bach obtained in the name of the Targhee 
entities to allegedly defrauded parties. Bach filed suit against the appellants, along with several 
other parties, on July 23, 2002, filing an amended complaint on September 27, 2002. The 
amended complaint alleged causes of action for quiet title, slander of title, intentional 
                                                 
1 Jack McLean passed away in December 2003. His daughter, Lynn McLean, was appointed personal representative 
of his estate in Teton County and the estate was substituted for Jack McLean as a party defendant. 
 
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interference with prospective economic advantage, breach of fiduciary duty, conversion, 
malicious prosecution, and malicious harassment.  
 
Harris appeared on behalf of all appellants and moved to strike the amended complaint on 
grounds that it improperly included additional parties, was brought for improper purposes, and 
failed to state a claim on which relief could be granted. The district court ruled that the appellants 
need not file an answer until it acted upon their motion to strike. The district court denied the 
motion to strike on January 10, 2003. The appellants then filed a motion to dismiss Bach’s 
claims under Idaho Rule of Civil Procedure (I.R.C.P.) 12(b)(8) on the basis that the claims had 
already been addressed and dismissed with prejudice in a previous federal case. On January 27, 
2003, Bach procured the entry of a default against the appellants. The appellants’ motion to 
dismiss was denied on March 4, 2003, meaning that in order to be timely, the appellants had to 
file an answer by March 14, 2003. Idaho R. Civ. P. 12(a), 77(d).2 The appellants filed an answer 
on March 19, 2003; however, the clerk of the district court had already entered default against 
them that morning. 
 
The appellants brought a motion to set the default aside under I.R.C.P. 55(c) and 60, 
which they supported with “documents and pleadings on file herein and attached hereto.” 
However, nothing was attached to the motion to set aside the default and the appellants filed no 
affidavits in support of their motion. The court entered an order striking the appellants’ answer as 
untimely because of the January 27, 2003 default. The court’s order contained no mention of the 
March 19, 2003 default. After the answer was stricken, the appellants filed a subsequent motion 
to set aside the default. In support of their motion, appellants argued that default could not be 
entered against them under I.R.C.P. 55 because they had appeared in the action and did not 
receive a notice of Bach’s intent to take default. The district court again denied the appellants’ 
motion. Although the district court found that the January 27, 2003 default was improperly 
entered because of the pending 12(b)(8) motion, the court found that the March 19, 2003 default 
was properly entered. The district court rejected the appellants’ arguments in support of setting 
aside the default, finding that default was entered by the clerk under I.R.C.P. 55(a)(1), and that a 
clerk’s entry of default did not require three days’ notice.3 The court also found the appellants 
                                                 
2 References to the I.R.C.P. in this opinion refer to the version in effect in 2003.  
3 At the time, I.R.C.P. 55(a)(1) authorized the clerk to enter a default against a party who had failed to plead or 
otherwise defend. An amendment effective July 1, 2004, removed that authorization. The 2004 amendment also 
incorporated into rule 55(a)(1) the present three-days’ notice requirement for a party who has appeared in the action. 
 
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failed to make a showing of sufficient facts to warrant setting aside the default, specifically that 
they failed to show a meritorious defense to the causes of action asserted against them. 
Appellants moved to reconsider the district court’s refusal to set aside default, but their motion 
was denied.  
 
Because of the nature of the causes of action asserted against the appellants, the district 
court ordered an evidentiary hearing to determine the terms of the judgment to be entered against 
them. Once that hearing was held, the court entered default judgment against the appellants,4 
imposing monetary damages and quieting Bach’s title to all disputed properties. Once final 
judgment was entered, the appellants filed a timely notice of appeal to this Court, arguing that 
the district court erred in allowing default to be entered, in failing to set aside the default, and in 
imposing speculative damages against the appellants.  
II. 
Issues Presented on Appeal 
The following issues are presented on appeal: (1) whether the district court abused its 
discretion in declining to set aside the default; and (2) whether the district court’s award of 
monetary damages was proper.  
III. 
Discussion 
A. 
Standard of Review 
A motion to set aside a default or judgment by default is addressed to the discretion of the 
trial court. Marco Distributing, Inc. v. Biehl, 97 Idaho 853, 856, 555 P.2d 393, 396 (1976). A 
district court’s refusal to set aside a default judgment will not be disturbed on appeal, absent an 
abuse of that discretion. Idaho ex rel. Russell v. Real Prop. Situated in the County of Cassia, 144 
Idaho 60, 62, 156 P.3d 561, 563 (2007). In determining whether the district court abused its 
discretion, this Court considers whether the trial court: (1) correctly understood the issue to be 
one of discretion; (2) acted within the outer bounds of its discretion; and (3) reached its decision 
on the motion before it through the exercise of reason. Id. The legal standard for a motion to set 
aside a default or default judgment under I.R.C.P. 55(c) is either “for good cause shown” or the 
grounds found in I.R.C.P. 60(b), which allows default judgment to be set aside for, among other 
                                                 
4 A separate default judgment was entered against Lynn McLean as personal representative of the estate of Jack 
McLean. No default judgment was entered against Jack McLean himself.  
 
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things, mistake, inadvertence, or excusable neglect. Id. When ruling on a motion to set aside a 
default judgment on I.R.C.P. 60(b) grounds, the district court is deemed to have acted within its 
discretion if it applies the governing legal standards to the facts in a logical manner while 
keeping in mind the disfavored status of default judgments. Id.  
B.  
The Default Was Properly Entered 
The appellants argue that the district court abused its discretion in refusing to set aside 
the default entered by the clerk on March 19, 2003, because the appellants did not receive the 
three-days’ notice required by I.R.C.P. 55(b)(2) to parties who have already appeared in an 
action. The district court, in ruling on the motion to set aside the default, pointed out that the 
three-day notice requirement of I.R.C.P. 55(b)(2) did not apply to entry of default under I.R.C.P. 
55(a). 
 
The appellants were not entitled to three-days’ notice of intent to take default because the 
pertinent rule did not require notice at the time the default was entered. The 2003 version of Rule 
55(a)(1) provides “[w]hen a party against whom a judgment for affirmative relief is sought has 
failed to plead or otherwise defend . . . and that fact is made to appear by affidavit or otherwise, 
the court, or the clerk thereof, shall enter default against the party.” Idaho R. Civ. P. 55(a)(1). 
This version of the rule did not contain the present three-day notice requirement for parties who 
have previously appeared. 
 
The March 19, 2003 default was properly entered. The appellants appeared specially in 
this matter and made motions to dismiss or strike Bach’s complaint under I.R.C.P. 12. The last of 
these motions was denied on March 4, 2003, and the notice of service on the order indicates that 
it was served on all parties the same day. The court also noted in a later order that the order 
denying the last motion to dismiss was served on appellants by fax on March 4, 2003. Under 
I.R.C.P. 12(a), where a motion is made under rule 12(b) prior to filing a responsive pleading, a 
responsive pleading must be filed within ten days of the denial of the last rule 12(b) motion in 
order to avoid default. Idaho R. Civ. P. 12(a). The appellants were explicitly put on notice of the 
fact that a responsive pleading had to be filed by the court’s service of the order denying their 
motion. See Idaho R. Civ. P. 77(d) (“Immediately upon the entry of an order . . . the clerk of the 
district court . . . shall serve a copy thereof . . . . Such [service] is sufficient notice for all 
purposes for which notice of the entry of an order is required by these rules.”). Accordingly, the 
 
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appellants’ failure to file their answer by March 14, 2003 provided grounds for entry of default 
by the clerk under I.R.C.P. 12(a) and 55(a)(1); thus, the clerk properly entered default on March 
19, 2003.  
 
The district court correctly refused to set aside the default. A defaulted party may petition 
the court to set aside an entry of default for good cause shown. Idaho R. Civ. P. 55(c). One of the 
requirements of good cause is the showing of a meritorious defense. Russell, 144 Idaho at 62, 
156 P.3d at 563; Hearst Corp. v. Keller, 100 Idaho 10, 12, 592 P.2d 66, 68 (1979). This 
requirement is imposed because “[i]t would be an idle exercise for the court to set aside a default 
if there is in fact no real justiciable controversy.” Id. Consequently, where no meritorious 
defense is shown in support of a motion to set aside a default, a court does not abuse its 
discretion in denying the motion. 
While Harris submitted an affidavit in support of the motion to set aside the default, there 
were no facts alleged in the affidavit that demonstrated a meritorious defense to Bach’s claims. 
The appellants argue that their answer set forth sufficient facts to constitute a meritorious 
defense, but that pleading was stricken prior to the hearing on the motion to set aside the default 
and none of those facts were set forth in the affidavit in support of appellants’ motion to set aside 
default. Thus, it could not properly be considered by the district court in ruling on the motion. 
Furthermore, as this Court has noted, a party may not rely on an ordinary pleading to prove a 
meritorious defense because “[o]nce a default has been entered the pleading of a defensive 
matter must go beyond the mere notice requirements that would be sufficient if pled before 
default.” Hearst Corp., 100 Idaho at 12, 592 P.2d at 68. The district court did not abuse its 
discretion in concluding that appellants had failed to demonstrate a meritorious defense.  
While appellants’ motion to set aside the default made reference to I.R.C.P. 60, 
appellants do not appear to have pursued that avenue of relief in the district court and have 
presented no argument on the issue on appeal. Therefore, we do not address it here. 
C. 
The Judgment Was Proper 
The appellants next argue that even if default was properly entered, the case must be 
remanded for determination of damages because damages were not proven with reasonable 
certainty in the district court. We decline to address this issue on appeal because the appellants 
failed to comply with the Idaho Appellate Rule. This Court will not consider an issue not 
 
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“supported by argument and authority in the opening brief.” Idaho App. R. 35(a)(6) (“The 
argument shall contain the contentions of the appellant with respect to the issues presented on 
appeal, the reasons therefor, with citations to authorities, statutes and parts of the transcript and 
the record relied upon.”); Jorgensen v. Coppedge, 145 Idaho 524, 528, 181 P.3d 450, 454 (2008). 
Consequently, to the extent that an assignment of error is not argued and supported in 
compliance with the I.A.R., it is deemed to be waived. Suitts v. Nix, 141 Idaho 706, 708, 117 
P.3d 120, 122 (2005). In Jorgensen, this Court refused to address an argument concerning an 
implied agreement when no argument or authority was introduced supporting the proposition. 
145 Idaho at 528, 181 P.3d at 454. Similarly, in Huff v. Singleton, this Court refused to address 
several issues on appeal because the appellant simply attempted to get this Court to reweigh the 
evidence presented to the trier of fact through attacks on the credibility of the evidence. 143 
Idaho 498, 500, 148 P.3d 1244, 1246 (2006).  
Here, the appellants make a general allegation that damages were not proven to a 
reasonable certainty. The argument concerning the sufficiency of damages comprises one 
paragraph that sets forth the standard of review for a damage award, along with a citation to a 
small portion of the transcript of the hearing to determine damages and the exhibits introduced at 
that hearing.5 This, without more, is insufficient to meet the requirements of I.A.R. 35(a)(6). The 
contention that no meaningful substantive testimony was presented is not supported by any 
authority or relevant citations to the record. The contention that the damages were not removed 
from the realm of speculation is much the same. Appellants’ argument that Bach failed to prove 
a condition precedent to liability for slander of title misunderstands the nature of a default 
judgment. As the district court pointed out when the argument was raised below, a defendant in 
default is not entitled to contest liability for an award of relief, but may present evidence as to the 
                                                 
5 The following paragraph constitutes the whole of  the appellants’ argument on damages:  
 
Appellants assert that the amount of damages simply was not proven in this matter to any 
degree of certainty. This Court has held that damages have to proven with reasonable certainty. 
This requires that they be taken out of the realm of speculation. See Griffith v. Clear Lakes Trout 
Co., Inc., 143 Idaho 733, 740, 152 P.3d 604, 611 (2007). In the present case, although there was a 
hearing set for the testimony on February 3, 2004, there was no meaningful substantive testimony 
given. Plaintiff rested on his exhibits. See Clerk's Transcript at p. 1461-1464. Appellants assert 
that the Affidavits did not contain sufficient facts to take the damages out of the realm of 
speculation. See Exhibits 81-1 to 81-6, 83-86. For example, Plaintiff wholly failed to establish 
ownership of the real property, which is a prerequisite for an award of damages for slander of title. 
 
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amount of damages or nature of other relief sought.6 We find that the district court’s position is 
consistent with the language of I.R.C.P. 55(b)(2), which provides that the determination of the 
sufficiency of evidence required in support of a default judgment is within the discretion of the 
district court. Idaho R. Civ. P. 55(b)(2).  
Accordingly, because the appellants have failed to provide any argument or authority to 
support their claims, the argument is waived and the judgment of the district court is affirmed.  
IV. 
Conclusion 
 
Because the trial court did not abuse its discretion in refusing to set aside the default and 
the appellants failed to preserve issues related to the relief granted, the judgment of the district 
court is affirmed. Costs are awarded to Bach. 
 
 
Chie Justice EISMANN, and Justices BURDICK, W. JONES and HORTON CONCUR. 
                                                 
6 The district court noted in its default judgment that, “Defendants Harris, Scona, Fitzgerald and Lyle personally 
appeared at the hearing but declined to cross examine Bach or to call any witnesses.” Thus, these appellants did have 
an opportunity to influence the relief made available to Bach in the default judgment but failed to avail themselves 
of such opportunity.