Court Opinion

ID: 5137300
Source: CourtListenerOpinion
Date Created: 2021-12-21 14:38:22.668139+00
Date Added: 2024-06-11T08:24:01.520671
License: Public Domain

IN THE UTAH COURT OF APPEALS

                                      ‐‐‐‐ooOoo‐‐‐‐

Vilma Estrada, Lidia Hernandez              )         MEMORANDUM DECISION
Arellano, Victor Bravo, Jose Lopez,         )
Hilda Hernandez, and Leila Stowell,         )           Case No. 20100418‐CA
                                            )
      Plaintiffs and Appellants,            )
                                            )                 FILED
v.                                          )              (March 22, 2012)
                                            )
Robin Mendoza, Fred W. Almanza,             )               2012 UT App 82
Feria Access LLC, Southern                  )
Management Professional Limited             )
Liability Company, and Does 1–50,           )
                                            )
      Defendants and Appellees.             )

                                          ‐‐‐‐‐

Fourth District, Provo Department, 090402579
The Honorable Claudia Laycock

Attorneys:      Brian W. Steffensen, Salt Lake City, for Appellant
                Jamis M. Gardner, Provo, for Appellee

                                          ‐‐‐‐‐

Before Judges Voros, Thorne, and Roth.

VOROS, Associate Presiding Judge:

¶1     This appeal originated as six separate actions.1 Plaintiffs appeal a judgment on
the pleadings in favor of Robin Mendoza, Fred W. Almanza, Feria Access LLC, and
Southern Management Professional LLC (collectively, Defendants). We affirm in part,
reverse in part, and remand for further proceedings.2

1. Six borrowers filed separate but identical lawsuits in Salt Lake County. The suits
were transferred to Utah County and consolidated into a single action.

2. Pursuant to rule 37(a) of the Utah Rules of Appellate Procedure, Defendants filed a
suggestion of mootness indicating that bankruptcy filings had rendered the appeal
                                                                          (continued...)
¶2     “The grant of a motion for judgment on the pleadings is reviewed under the
same standard as the grant of a motion to dismiss, i.e., we affirm the grant of such a
motion only if, as a matter of law, the plaintiff could not recover under the facts
alleged.” Miller v. Gastronomy, Inc., 2005 UT App 80, ¶ 6, 110 P.3d 144 (citation and
internal quotation marks omitted). When “reviewing a motion for judgment on the
pleadings, this court accepts the factual allegations in the complaint as true; we then
consider such allegations and all reasonable inferences drawn therefrom in a light most
favorable to the plaintiff.” Id. ¶ 1 n.1 (citation and internal quotation marks omitted).

¶3      Plaintiffs are borrowers on payday loans gone awry.3 Defendant Mendoza
owned and operated Feria Access, a payday lender with an office in Salt Lake City.
Plaintiffs obtained, then defaulted on, payday loans from Feria Access’s Salt Lake City
office. Defendants sued Plaintiffs in small claims court in Utah County. Plaintiffs allege
that Defendants sued in Utah County with the “hope that [Plaintiffs] and others
similarly situated might be unable to appear in Utah County and thus be defaulted.”
Plaintiffs did fail to appear, and Defendants were indeed awarded default judgments.
Defendants obtained writs of garnishment in amounts that Plaintiffs allege were
inflated. Plaintiffs neither appealed nor resorted to remedies available to them under

2. (...continued)
moot as to Mendoza and Feria Access. See Utah R. App. P. 37(a); Salt Lake County v.
Holliday Water Co., 2010 UT 45, ¶ 15, 234 P.3d 1105 (“An appeal is moot if during the
pendency of the appeal circumstances change so that the controversy is eliminated,
thereby rendering the relief requested impossible or of no legal effect.” (citation and
internal quotation marks omitted)). Plaintiffs did not object or present
counterargument in writing or at oral argument. Accordingly, we dismiss the appeal as
to Mendoza and Feria Access.

3. “Payday loans are small‐dollar, short‐term, unsecured loans that borrowers promise
to repay out of their next paycheck or regular income payment. . . . Because these loans
have such short terms to maturity, the cost of borrowing, expressed as an annual
percentage rate, can range from 300 percent to 1,000 percent, or more.” Federal Deposit
Insurance Corporation, Payday Lending, http://www.fdic.gov/bank/analytical/fyi/2003/
012903fyi.html (last visited Mar. 19, 2012). “While payday lending was virtually
nonexistent in 1985, by 2002 it exploded into an industry with over twenty‐five
thousand retail outlets nationwide, more than McDonald’s, Burger King, Sears, J.C.
Penney, and Target stores combined.” Christopher L. Peterson, Usury Law, Payday
Loans, and Statutory Sleight of Hand: Salience Distortion in American Credit Pricing Limits,
92 Minn. L. Rev. 1110, 1111 (2008).

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rule 64D of the Utah Rules of Civil Procedure, which provides a process to object to
inaccurate garnishments. Instead, Plaintiffs filed independent actions in district court.

¶4     Plaintiffs’ complaint alleges three causes of action: civil conspiracy, violation of
the Utah Consumer Sales Practices Act (the UCSPA), and violation of the Fair Credit
Reporting Act. In granting Defendants’ motion for judgment on the pleadings, the trial
court ruled that Plaintiffs should have availed themselves of the remedies that the Utah
Rules of Small Claims Procedure provide; that Plaintiffs waived any causes of action
based on the inflated garnishments for failure to seek relief under rule 64D in small
claims court; and that Plaintiffs’ complaint failed to adequately state claims for civil
conspiracy, violation of the UCSPA, and violation of the Fair Credit Reporting Act.
Plaintiffs raise multiple claims of error on appeal.

1. Utah Consumer Sales Practices Act

¶5      The gravamen of Plaintiffs’ case is that the Defendants violated the UCSPA, see
Utah Code Ann. §§ 13‐11‐1 to ‐23 (2009). The UCSPA creates a cause of action against a
“seller” who commits either a “deceptive” or an “unconscionable” “act or practice . . . in
connection with a consumer transaction . . . whether it occurs before, during, or after the
transaction.” Id. §§ 13‐11‐4(1), ‐5(1). To that end, the UCSPA “shall be construed
liberally” to, among other things, “protect consumers from suppliers who commit
deceptive and unconscionable sales practices.” Id. § 13‐11‐2(2).

¶6      Plaintiffs allege that Defendants engaged in deceptive and unconscionable
conduct by obtaining garnishments for more money than they were legally owed. The
trial court ruled that Plaintiffs waived any claim arising out of inflated garnishment
amounts by bypassing remedies available to them in small claims court under rule 64D
of the Utah Rules of Civil Procedure. Rule 64D(h) provides a process by which a
judgment debtor can challenge a writ of garnishment. See Utah R. Civ. P. 64D(h). Rule
64D applies to the collection of small claims judgments. See Utah R. Small Claims P.
11(a) (“Judgments may be collected under the Utah Rules of Civil Procedure.”).
Plaintiffs argue that their failure to challenge the allegedly flawed garnishments in the
underlying small claims action does not preclude them from bringing a new action
based on those flaws.

¶7     “‘With rare exception, when a court with proper jurisdiction enters a final
judgment, . . . that judgment can only be attacked on direct appeal.’” Moss v. Parr
Waddoups Brown Gee & Loveless, 2010 UT App 170, ¶ 9, 237 P.3d 899 (omission in
original) (quoting State v. Hamilton, 2003 UT 22, ¶ 25, 70 P.3d 111), cert. granted, 245 P.3d

20100418‐CA                                   3
757 (Utah 2010).4 “‘“The general rule . . . is that a judgment may not be drawn in
question in a collateral proceeding and an attack upon a judgment is regarded as
collateral if made when the judgment is offered as the basis of a claim in a subsequent
proceeding.”’” Id. (quoting Tolle v. Fenley, 2006 UT App 78, ¶ 15, 132 P.3d 63 (quoting
Olsen v. Board of Educ., 571 P.2d 1336, 1338 (Utah 1977))). “‘“Where a judgment is
attacked in other ways than by proceedings in the original action to have it vacated or
revised or modified or by a proceeding in equity to prevent its enforcement, the attack
is a ‘Collateral Attack.’”’” Id. (quoting Olsen, 571 P.2d at 1338 (quoting Restatement of
Judgments § 11 cmt. a (1942))).5

¶8     Thus, Plaintiffs here are precluded from collaterally attacking the validity of the
small claims court writs because they “failed to use any of the available legal avenues
for challenging [them] at the time they were issued or executed.” See id. ¶ 10.
However, Plaintiffs contend that their UCSPA claim does not constitute a collateral
attack on those writs, because they “are not seeking to have the Writ[s] withdrawn” or
“to have the garnishments released.” Rather, they rely on Defendants’ conduct in
obtaining the writs as deceptive or unconscionable practices under the UCSPA and the
common law of civil conspiracy.

4. “The fact that certiorari was granted . . . does not deprive [the opinion] of
precedential value for us.” United States ex rel. Daneff v. Henderson, 501 F.2d 1180, 1181
(2d Cir. 1974) (citation omitted); cf. Clinton v. Jones, 520 U.S. 681, 689 (1997) (“[O]ur
decision to grant the petition [for certiorari] expressed no judgment concerning the
merits of the case . . . .” (citation omitted)).

5. It is unclear whether the plaintiffs in Moss v. Parr Waddoups Brown Gee & Loveless,
2010 UT App 170, 237 P.3d 899, cert. granted, 245 P.3d 757 (Utah 2010), alleged fraud on
the court under rule 60(b) of the Utah Rules of Civil Procedure. Plaintiffs here did.
After describing various means of challenging a final judgment in the trial court, rule
60(b) states, “This rule does not limit the power of a court to entertain an independent
action to relieve a party from a judgment, order or proceeding or to set aside a
judgment for fraud upon the court.” Utah R. Civ. P. 60(b). However, Plaintiffs’ brief
never mentions rule 60(b) and cites no cases involving fraud on the court. Accordingly,
any rule 60(b) claim is either abandoned on appeal or inadequately briefed. See Utah R.
App. P. 24(a)(9) (stating that an adequately briefed argument “contain[s] the
contentions and reasons of the appellant with respect to the issues presented, including
the grounds for reviewing any issue not preserved in the trial court, with citations to the
authorities, statutes, and parts of the record relied on”).

20100418‐CA                                  4
¶9     We agree with Plaintiffs on this point. In pleading their UCSPA claim, Plaintiffs
allege that Defendants’ acts in obtaining writs in the small claims court were
“deceptive” or “unconscionable.” See Utah Code Ann. §§ 13‐11‐4(1), ‐5(1). Hence their
UCSPA claim does not “depend[] upon a determination that the [writs] were illegal.”
See Moss, 2010 UT App 170, ¶ 9. The small claims court judgments are thus not
“draw[n] in[to] question” by this claim. See id. (citation and internal quotation marks
omitted). Nor do Plaintiffs seek to have those judgments “vacated or revised or
modified,” or “to prevent [their] enforcement.” See id. (citation and internal quotation
marks omitted). Therefore, Plaintiffs’ UCSPA claim is not a collateral attack on the small
claims judgments and is thus not waived by Plaintiffs’ failure to challenge the writs in
the small claims proceedings.

¶10 In dismissing Plaintiffs’ claim under the UCSPA, the trial court also perfunctorily
stated that the acts alleged by Plaintiffs are not deceptive or unconscionable acts or
practices under the UCSPA. We do not read this as a ruling on the merits of Plaintiffs’
UCSPA claims. The UCSPA establishes a policy of giving plaintiffs a reasonable
opportunity to prove unconscionability: “If it is claimed or appears to the court that an
act or practice may be unconscionable, the parties shall be given a reasonable
opportunity to present evidence as to its setting, purpose, and effect to aid the court in
making its determination.” Utah Code Ann. § 13‐11‐5(2). In light of this policy—and in
light of the absence of any discussion of the requirements of the UCSPA and whether
the alleged acts met those requirements—we read the trial court’s statements as a
conclusion that the Plaintiffs’ allegations constituted a collateral attack on the writs
rather than a ruling on the merits of an UCSPA claim at the pleadings stage.6

¶11 We accordingly reverse the trial court’s ruling that Plaintiffs’ failure to challenge
the writs in the small claims action bars their claim under the UCSPA and remand for
further proceedings on this claim.7

6. Given our resolution of the issue, we need not address Plaintiffs’ argument that they
were denied due process due to their inability to address the merits of their UCSPA
claim below. Nor do we address either party’s arguments on appeal relating to the
merits of Plaintiffs’ UCSPA claim.

7. A deceptive or unconscionable act or practice by a supplier in connection with a
consumer transaction violates the UCSPA “whether it occurs before, during, or after the
transaction.” Utah Code Ann. §§ 13‐11‐4(1), ‐5(1) (2009). We express no opinion as to
                                                                           (continued...)

20100418‐CA                                 5
2. Civil Conspiracy

¶12 Next, Plaintiffs contend that the trial court erred in ruling that their complaint
failed to adequately plead a cause of action for civil conspiracy.

¶13 To establish a claim of civil conspiracy, five elements must be shown: “‘(1) a
combination of two or more persons, (2) an object to be accomplished, (3) a meeting of
the minds on the object or course of action, (4) one or more unlawful, overt acts, and (5)
damages as a proximate result thereof.’” Peterson v. Delta Air Lines, Inc., 2002 UT App
56, ¶ 12, 42 P.3d 1253 (quoting Alta Indus. v. Hurst, 846 P.2d 1282, 1290 n.7 (Utah 1993)).
“The claim of civil conspiracy ‘require[s], as one of [its] essential elements, an
underlying tort.’” Puttuck v. Gendron, 2008 UT App 362, ¶ 21, 199 P.3d 971 (alteration in
original) (quoting Coroles v. Sabey, 2003 UT App 339, ¶ 36, 79 P.3d 974). “Thus, in order
to ‘sufficiently plead’ a claim for civil conspiracy, a plaintiff is ‘obligated to adequately
plead the existence of such a tort.’” Id. (quoting Coroles, 2003 UT App 339, ¶ 36).
“Where plaintiffs have ‘not adequately pleaded any of the basic torts they allege . . .
dismissal of their civil conspiracy claim’ is appropriate.” Id. (omission in original)
(quoting Coroles, 2003 UT App 339, ¶ 38); see also 16 Am. Jur. 2d Conspiracy § 50 (2009)
(“[I]f the acts alleged to constitute the underlying wrong provide no cause of action,
then neither is there a cause of action for the conspiracy itself.”).

¶14 To satisfy the fourth element, Plaintiffs rely on the following six underlying torts:
(a) fraud on the court in obtaining writs of execution and/or garnishment, (b) fraud on
Plaintiffs based on inflated amounts of the writs of execution and/or garnishment, (c)
violation of the UCSPA, (d) violation of the Fair Debt Collection Practices Act, (e)
violation of the Fair Credit Reporting Act, and (f) defamation by reporting false credit
information.

¶15 The first two underlying torts named above rely on the issuance of post‐
judgment writs in the small claims cases to satisfy the requirement of an unlawful act.
Thus, unlike the UCSPA claim, this cause of action does “depend[] upon a
determination that the . . . orders were illegal,” Moss v. Parr Waddoups Brown Gee &
Loveless, 2010 UT App 170, ¶ 9, 237 P.3d 899 (omission in original), cert. granted, 245 P.3d
757 (Utah 2010). It is thus barred as a collateral attack on a final judgment. We

7. (...continued)
whether an act occurring in the course of litigation arising from a consumer transaction
falls within this definition.

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therefore do not disturb the trial court’s dismissal of Plaintiffs’ conspiracy claim insofar
as it is based on fraud.8

¶16 The third underlying tort named above is violation of the UCSPA. As explained
above, Plaintiffs’ UCSPA claim is not barred as a collateral attack on a prior judgment,
because it does not depend on the small claims court writs being unlawful—it is
sufficient that they were deceptive or unconscionable. See supra ¶¶ 8–10. We therefore
reverse the trial court’s dismissal of Plaintiffs’ civil conspiracy claim insofar as it is
based on a violation of the UCSPA. To the extent Plaintiffs are able to maintain their
UCSPA claim, that claim is eligible to serve as a predicate act for their civil conspiracy
claim.

¶17 The trial court also ruled that Plaintiffs had conceded that they do not have a
cause of action under the Fair Credit Reporting Act or for defamation. Our review of
the record suggests that the trial court was correct on this point. Furthermore,
Plaintiffs’ brief on appeal does not challenge the ruling. In addition, Plaintiffs concede
that they do not have an independent cause of action under the Fair Debt Collection
Practices Act. Nevertheless, Plaintiffs take the position that a wrongful act may serve as
the underlying tort for purposes of a conspiracy claim even if they have no independent
cause of action based on that wrongful act. Plaintiffs cite no authority in support of this
theory, nor do they attempt to distinguish apparently contrary authority. For example,
this court has cited authority stating that if “‘the acts alleged to constitute the
underlying wrong provide no cause of action, then neither is there a cause of action for

8. We also agree with the trial court that Plaintiffs failed to adequately plead the
underlying tort of fraud. Rule 9(b) of the Utah Rules of Civil Procedure specifies that
“[i]n all averments of fraud or mistake, the circumstances constituting fraud or mistake
shall be stated with particularity.” The tort of fraud includes nine elements. See Armed
Forces Ins. Exch. v. Harrison, 2003 UT 14, ¶ 16, 70 P.3d 35 (listing the elements).
However, mere recitation of those elements, or conclusory allegations unsupported by
allegations of relevant surrounding facts, does not satisfy rule 9(b)’s particularity
standard. Id. Here, Plaintiffs alleged only that “the defendants have requested and
obtained through fraud upon the Court writs of execution and/or writs of garnishment
against the Plaintiff(s) which included unjustified and deliberately inflated ‘costs’ or
‘judgment’ amounts, and the like.” We thus agree with the trial court that, insofar as
the Plaintiffs’ civil conspiracy claim rests on the underlying tort of fraud, it fails to
adequately allege the elements of civil conspiracy and was properly dismissed on that
ground.

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the conspiracy itself.’” Puttuck, 2008 UT App 362, ¶ 21 (quoting 16 Am. Jur. 2d
Conspiracy § 50 (1998)). Plaintiffs’ absence of briefing on this point suggests that they
may have abandoned it. In any event, we will not reverse on the basis of an unbriefed
argument. See Utah R. App. P. 24(a)(9); State v. Green, 2004 UT 76, ¶ 13, 99 P.3d 820
(“[T]his court is not a depository in which the appealing party may dump the burden of
argument and research.” (citation and internal quotation marks omitted)).

¶18 In sum, insofar as Plaintiffs’ claim for civil conspiracy rests on an allegation that
Defendants violated the UCSPA, we reverse the trial court’s dismissal and remand for
further proceedings. Insofar as the civil conspiracy claim rests on other grounds, we
affirm the trial court’s dismissal.

3. Dismissal Without Leave to Amend

¶19 Finally, Plaintiffs contend that the trial court erred by dismissing their complaint
without granting leave to amend. “We review a district court’s denial of leave to
amend for an abuse of discretion.” Hudgens v. Prosper, Inc., 2010 UT 68, ¶ 15, 243 P.3d
1275.

¶20 After a responsive pleading has been served, “a party may amend his pleading
only by leave of court or by written consent of the adverse party; and leave shall be
freely given when justice so requires.” Utah R. Civ. P. 15(a). “To properly move for
leave to amend a complaint, a litigant must file a motion that ‘shall be made in writing,
shall state with particularity the grounds therefor, and shall set forth the relief or order
sought.’” Holmes Dev., LLC v. Cook, 2002 UT 38, ¶ 57, 48 P.3d 895 (quoting Utah R. Civ.
P. 7(b)(1)). “Further, a motion for leave to amend must be accompanied by a
memorandum of points and authorities in support, and by a proposed amended
complaint.” Id. (citing Utah R. Jud. Admin. 4‐501(1)(A) (repealed 2003); Behrens v.
Raleigh Hills Hosp., Inc., 675 P.2d 1179, 1182 (Utah 1983); Long v. Satz, 181 F.3d 1275, 1279
(11th Cir. 1999)); accord Puttuck v. Gendron, 2008 UT App 362, ¶ 23, 199 P.3d 971.

¶21 Plaintiffs here complied with none of these requirements. In addition, their
argument on appeal is scant, consisting of two sentences. They cite two cases without
analysis, one of which involves a litigant who, unlike Plaintiffs here, filed a written
motion to amend accompanied by a proposed amended complaint and, apparently, a
memorandum. See Hudgens, 2010 UT 68, ¶ 10. We see no abuse of discretion by the
trial court on this point.

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¶22 The judgment of the trial court is affirmed in part, reversed in part, and
remanded for further proceedings.

____________________________________
J. Frederic Voros Jr.,
Associate Presiding Judge

                                          ‐‐‐‐‐

¶23   WE CONCUR:

____________________________________
William A. Thorne Jr., Judge

____________________________________
Stephen L. Roth, Judge

20100418‐CA                                9