Title: LITTLE HORN STATE BANK v REAL BIRD
Citation: N/A
Docket Number: 14630
State: Montana
Issuer: Montana Supreme Court
Date: August 9, 1979

No. 14630 I N THE S U P R E M E COUKL' O F THE STATl3 O F M3NTANA 19 79 LI'ITLE HORN STATE BANK, a hbntana Banking Corporation, Plaintiff and Respondent, -VS- WW REAL BIRD, J R . and l w ! D I w REAL BIRD, Defendants and A p ~ l l a n t s . Appeal fm: District Court of the Thirteenth Judicial D i s t r i c t , Honorable Charles Luedke, Judge presiding. Counsel of Record: For Appellants: D. Michael Eakin, Legal Services, argued, Hardin, Ibntana Steven L. Bunch, Legal Services, argued, H e l e n a , Fkx&ana For Respondent : Clarence T . Belue argued, H a r d i n , Mntana Suhitted: June 1 1 , 1979 Decided: RUG - 9 1 9 7 9 A ~ G - ' ! g p Filed: - M r . J u s t i c e John Conway Harrison d e l i v e r e d t h e Opinion of t h e Court. P l a i n t i f f bank brought t h i s a c t i o n i n J u s t i c e Court, Big Horn County, t o recover money owing from defendant on c e r t a i n promissory notes. The J u s t i c e Court e n t e r e d a d e f a u l t judgment i n f a v o r of p l a i n t i f f . Defendant's motion t o s e t a s i d e t h e de- f a u l t was denied, and she appealed t o t h e D i s t r i c t Court. The D i s t r i c t Court dismissed t h e appeal, and defendant a p p e a l s from t h e d i s m i s s a l . I n December 1977, p l a i n t i f f i n i t i a t e d t h i s a c t i o n i n Jus- tice Court t o recover money owing from two l o a n s made t o de- fendant. S e r v i c e of process was completed on defendant on January 10, 1978. On January 12, defendant appeared b e f o r e t h e J u s t i c e Court and sought t h e c o u r t ' s a s s i s t a n c e i n n e g o t i a t i n g a s e t t l e m e n t . N o w r i t t e n appearance was made nor was t h e r e any showing t h e defendant had an a t t o r n e y a t t h a t t i m e . A t t h e suggestion of t h e J u s t i c e Court, defendant contacted p l a i n - t i f f ' s a t t o r n e y and t r i e d t o reach a s e t t l e m e n t . She paid t h e a t t o r n e y $150 on h e r account and l e f t w i t h t h e understanding t h a t no a c t i o n would be taken i n t h e m a t t e r while she attempted t o s e c u r e a loan t o pay o f f t h e remainder of t h e indebtedness. On January 2 3 , without n o t i c e t o t h e defendant, t h e Jus- tice Court e n t e r e d a d e f a u l t judgment i n f a v o r of t h e bank and i s s u e d a w r i t of execution. The judgment d i d n o t g i v e t h e defen- d a n t c r e d i t f o r t h e $150 paid by h e r t o p l a i n t i f f ' s a t t o r n e y . Defendant learned of t h e d e f a u l t when h e r o n l y nonexempt a s s e t was s e i z e d pursuant t o t h e w r i t of execution. Defendant t h e n contacted an a t t o r n e y and f i l e d a timely motion t o set a s i d e t h e d e f a u l t judgment, supported by an a f f i d a v i t s e t t i n g o u t defenses, counterclaims, and f a c t s t o show defendant was n o t r e q u i r e d t o f i l e a w r i t t e n answer. The J u s t i c e Court denied t h e motion. Defendant then f i l e d n o t i c e of appeal i n J u s t i c e Court. She was unable t o f i n d s u r e t i e s f o r undertaking, s o she sub- m i t t e d an a f f i d a v i t of i n a b i l i t y t o provide t h e undertaking. P l a i n t i f f o b j e c t e d t o t h e j u r i s d i c t i o n of t h e District Court t o hear t h e appeal when no undertaking was provided. The D i s - t r i c t Court dismissed t h e appeal, and t h i s appeal followed. Defendant presented two i s s u e s on appeal involving v i o l a - t i o n of c o n s t i t u t i o n a l r i g h t s , both s t a t e and f e d e r a l . Due t o t h e p e c u l i a r f a c t s surrounding t h e e n t r y of t h e d e f a u l t judg- ment here, w e f i n d it unnecessary t o consider t h e two i s s u e s on appeal. Rather, w e base our d e c i s i o n on Montana c a s e law d e a l i n g w i t h c o n s i d e r a t i o n s s i m i l a r t o t h o s e presented i n t h i s case. I n Brothers v. Brothers (1924), 71 Mont. 378, 383-84, 230 P. 60, 61, t h i s Court s a i d : "No g r e a t abuse of d i s c r e t i o n by t h e t r i a l c o u r t i n r e f u s i n g t o set a s i d e a d e f a u l t need be shown t o warrant a r e v e r s a l , f o r t h e c o u r t s u n i v e r s a l l y f a v o r a t r i a l on t h e m e r i t s . " The Court went on t o s t a t e it i s p r e f - e r a b l e t o d i s p o s e of c a s e s on t h e i r m e r i t s than t o maintain t o o strict a regard f o r t e c h n i c a l r u l e s of procedure. Brothers, 71 Mont. a t 384, 230 P. a t 61. Here, t h e record shows t h e p l a i n t i f f took a d e f a u l t a f t e r t h e defendant f e l t she had been assured she would be given t i m e t o n e g o t i a t e a s e t t l e m e n t , and t h e judgment e n t e r e d exceeds t h e amount defendant owed p l a i n t i f f a t t h e t i m e t h e c o u r t e n t e r e d judgment by $150. Given t h e above r u l e favoring hearing c a s e s of t h i s n a t u r e on t h e i r m e r i t s , defendant should have her day i n c o u r t . W e t h e r e f o r e f i n d t h e judgment erroneous and remand t h e c a s e t o t h e D i s t r i c t Court of Big Horn County w i t h d i r e c t i o n s t o set a s i d e t h e d e f a u l t e n t e r e d and r e t u r n t h e cause t o t h e J u s t i c e Court f o r f u r t h e r proceedings. We concur: I 1 , / , $ i f 1 A ; 1 . ?r--,u& J u s t i cbq