Court Opinion

ID: 9394196
Source: CourtListenerOpinion
Date Created: 2023-05-12 17:03:19.530729+00
Date Added: 2024-06-11T17:18:57.802800
License: Public Domain

Notice: This opinion is subject to correction before publication in the Pacific Reporter.
      Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,
      303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email
      corrections@akcourts.gov.

               THE SUPREME COURT OF THE STATE OF ALASKA

 BBFM ENGINEERS, INC. and                          )
 ARCHITECTS ALASKA, INC.,                          )   Supreme Court No. S-17995/17996
                                                   )
                        Petitioners,               )   Superior Court No. 3AN-16-07620 CI
                                                   )
       v.                                          )   OPINION
                                                   )
 ERIC MCDONALD,                                    )   No. 7652 – May 12, 2023
                                                   )
                        Respondent.                )

              Petition for Review from the Superior Court of the State of
              Alaska, Third Judicial District, Anchorage, Thomas A.
              Matthews, Judge.

              Appearances: Michael W. Seville and Aaron Sperbeck,
              Birch Horton Bittner & Cherot, Anchorage, for Petitioner
              BBFM Engineers, Inc. Rebecca J. Hozubin and Douglas H.
              Kossler, Hozubin, Moberly & Associates, Anchorage, for
              Petitioner Architects Alaska, Inc. Eric McDonald, pro se,
              Kenai, Respondent.

              Before:    Winfree, Chief Justice, Maassen, Carney,
              Borghesan, and Henderson, Justices.

              MAASSEN, Justice,

      INTRODUCTION
              A subcontractor’s employee was injured on a construction site and sued
engineering and architecture firms for negligent design. In the months before trial the
parties’ attorneys discussed the possibility of settlement, and the defendants eventually
moved to enforce a “walk-away” settlement they claimed had been reached through
email correspondence. The employee, by then unrepresented, did not file a substantive
response to the defendants’ motion, though noting his opposition to their proposed
order. The superior court granted the defendants’ motion and dismissed the case.
             Just under a year later the employee moved for relief from judgment under
Alaska Rule of Civil Procedure 60(b), contending that he had never given his attorney
authority to settle the case. A different superior court judge granted the motion, finding
that factual issues precluded summary judgment on whether a settlement agreement
existed, that the earlier dismissal was erroneous as a matter of law, and that
extraordinary circumstances otherwise entitled the employee to Rule 60(b) relief.
             The defendants petitioned for review, which we granted. We now reverse
on the ground that the employee’s Rule 60(b) motion was not filed within a reasonable
time.
        BACKGROUND
        A.   Lawsuit
             Eric McDonald was injured during the 2014 renovation of a high school.
He was an employee of a subcontractor, Rock & Dirt Environmental, Inc.
             In November 2015 McDonald sued two other entities involved in the
renovation project: Architects Alaska, Inc. and BBFM Engineers, Inc. McDonald
claimed that these two companies were negligent in their “fail[ure] to exercise
reasonable care in the design, supervision, implementation, and specifications of the
demolition of the renovation project.” Architects Alaska and BBFM raised as an
affirmative defense a statute that protects design professionals from damage claims by
persons who are “entitled to compensation under [the Workers’ Compensation Act] as
a result of injury occurring at the job site of a construction project.” 1 Trial was
eventually set for August 2019; the dispositive motion deadline was in June 2019.

        1
             AS 23.30.017(a).

                                           -2-                                      7652
      B.     Early Settlement Discussions
             In April 2019 BBFM’s attorney emailed McDonald’s attorney, Katie
Elsner, to inform her that BBFM intended to move for summary judgment but would
likely agree to a “walk-away deal if it could avoid any further fees now.” Elsner asked
BBFM to hold off on filing its motion until she had a chance to talk with her client. In
May she emailed back to both defense counsel:
             I have been authorized to engage in discussions about
             resolving this case by dismissal with each side bearing their
             own costs and fees — i.e. walk away . . . . [Would your
             clients] be willing to resolve [the case] in such a manner?
             Please let me know.
Both defense counsel responded the same day agreeing to a walk-away settlement;
counsel for Architects Alaska included with her response a draft stipulation for
dismissal with prejudice. Two days later defense counsel again emailed Elsner to
follow up and ask whether she had any proposed changes to the stipulation. Elsner
responded, “I did review it, I am just waiting for final approval from my client.”
             Two and a half weeks later Elsner advised defense counsel by email that
she should have her client’s final answer in a few days. After another week passed,
counsel for Architects Alaska emailed Elsner asking whether McDonald was refusing
to settle: “Should I expect to receive a signed stipulation to dismiss or do I need to
notify my clients that Mr. McDonald has refused to settle . . . ?” The record contains
no response to this email, but five days later Elsner moved to withdraw with her client’s
consent, and the court granted the motion in early July.
      C.     Motion To Enforce Settlement Agreement
             BBFM then moved “for an order to enforce the settlement agreement in
this case.” BBFM argued that there had been “an offer, acceptance, and consideration”
and the parties therefore “have an enforceable agreement to settle this case” on a walk­
away basis. Architects Alaska joined in BBFM’s motion.

                                          -3-                                        7652
             McDonald, by then self-represented, did not respond to the motion to
enforce the settlement. On July 30 Superior Court Judge Eric Aarseth issued an order
explaining that he intended to grant the motion “unless [McDonald] file[d] an
opposition no later than August 9, 2019.” On August 7, with the trial date a few weeks
away, Judge Aarseth held a trial call; McDonald did not attend. Judge Aarseth signed
an order vacating the trial date — reasoning that “[he couldn’t] imagine anybody being
ready for trial” under the circumstances — and reiterated his intent to sign the order
enforcing the settlement unless he heard from McDonald by August 9.
             On August 12 McDonald filed a motion for continuance and opposition to
the proposed order. Most of his six-page pleading focused on his medical issues and
interactions with his own lawyers; he explained that he was “requesting a continuance
in order to gain his bearings concerning this case and to pursue alternative counsel.”
He mentioned the defendants’ pending motion only in his concluding line: “The
plaintiff . . . ask[s] the court to note his opposition to the defendant’s motion to force
settlement.” Because this motion and opposition was unsigned, it was returned to him
with a deficiency notice.
             Judge Aarseth granted the defendants’ motion to enforce settlement on
August 13. A few days later McDonald re-filed his motion and opposition. On
September 12 Judge Aarseth denied the motion for continuance on grounds that it
“clearly demonstrates that [McDonald] has been capable to work on this case and hire
an attorney if so motivated. No good cause has been shown to excuse his delay in
responding.” McDonald was sent a copy of the order; he did not file an appeal at that
time.
        D.   The Intervening Year; Civil Rule 60(b) Proceedings
             On December 19 McDonald spoke with his former lawyer Peter Ehrhardt,
one of Elsner’s law partners, to discuss the status of his worker’s compensation and tort

                                           -4-                                      7652
cases. 2 Ehrhardt told him that “first of all, [he had] to probably file a motion for
reconsideration or some kind of motion like that with [Judge] Aarseth to try to set aside
his ruling . . . . That’s the first . . . thing that needs to happen.” McDonald agreed:
“Okay . . . . [Y]eah, that’s a good idea. That’s what I need to do.” Ehrhardt explained,
“[Y]ou’re going to need somebody to represent you, not only to set aside the decision
by [Judge] Aarseth, and you may have to appeal that.” He asked McDonald when Judge
Aarseth had issued his order, observing that “those dates are critical” because any
motion for reconsideration had a very short timeline and “if [Judge] Aarseth made this
ruling in August, it’s probably too late to do anything.” He emphasized that the dates
were “absolutely critical” and said, “[A]s you know, timing on cases is everything,
right?”
             Three months went by, and on March 6, 2020, McDonald called Michael
Seville, the attorney for BBFM. He asked Seville to explain the basis of the court’s
order enforcing the settlement and questioned how the court could have “the impression
that [he] would have ever agreed to it at all.” Seville said he would provide McDonald
with a copy of the successful motion and its attachments but that “as far as [his] client’s
concerned, the case is over.” McDonald responded that the judge “made a decision that
violated Alaska law. And so [he’d] be petitioning to overturn it.” Seville told
McDonald he would “have to . . . take it back to the judge and ask him to undo the
judgment,” and McDonald replied, “And I’ll do that and I just kind of wanted to give
you a heads up of what . . . was happening.”
             But it was another five months before McDonald filed something in court.
On August 11, 2020 — two days shy of a year after Judge Aarseth’s order granting the
motion to enforce settlement — McDonald filed a 236-page motion to vacate the order.

      2
             McDonald recorded the relevant conversations with lawyers and
submitted the transcripts as exhibits; it is not evident whether the other parties to the
conversations were aware they were being recorded.

                                           -5-                                       7652
Citing Alaska Civil Rule 60(b), he argued that he had never authorized his attorney to
settle; that the parties never reached a binding agreement; and that the court had
erroneously rejected his opposition to the motion. BBFM and Architects Alaska both
opposed the Rule 60(b) motion, arguing both that it was untimely and that it was
substantively without merit.
              The Rule 60(b) motion was assigned to Superior Court Judge Thomas
Matthews, who held oral argument in December 2020. McDonald told the court that
when his case was dismissed he believed the settlement “had been forced” and he was
unsure how to proceed. He explained that his employer’s attorney had “accused [him]
of accepting a settlement” and that this was potentially fatal to his worker’s
compensation case. 3 He said that it was at this point he “started to look into these
issues,” after which “it took [him] a while to actually fashion . . . [his] argument.”
              Judge Matthews granted the Rule 60(b) motion, vacating Judge Aarseth’s
order enforcing the settlement. Judge Matthews reasoned that the motion to enforce the
settlement should have been treated as a motion for summary judgment, to be granted
only if there were no material facts in dispute. He concluded that the evidence showed
at most “a preliminary intent to negotiate,” meaning that summary judgment in the
defendants’ favor was not warranted.
              Judge Matthews also found that McDonald’s opposition to the defendants’
motion to enforce settlement had been timely filed, though acknowledging that it “did
not respond to BBFM’s or [Architects Alaska’s] arguments [about the settlement].”4

       3
             McDonald’s former employer petitioned for a dismissal of McDonald’s
workers’ compensation claims on the ground that he had “obtained a settlement in his
third-party matter [against Architects Alaska and BBFM]” without the employer’s
written approval as required by AS 23.30.015(h).
       4
             The opposition was due on a Friday — when the court closed at noon —
and was filed the following Monday. Alaska Supreme Court Order No. 1875 made

                                           -6-                                       7652
He concluded that McDonald was “entitled to relief from a final order under Rule
60(b)(1) due to mistake.” He continued, “Moreover, Rule 60(b)(6) allows the court to
provide relief under the Rule for ‘any other reason justifying relief from the operation
of the judgment.’ ” “To the extent that Mr. McDonald has not fully argued that the
Court made a mistake by not applying the summary judgment standard, this Court
concludes that relief under Rule 60(b)(6) is also appropriate.”
              Architects Alaska and BBFM petitioned for review. We granted the
petitions and ordered full briefing.
       STANDARD OF REVIEW
              “We will not disturb a trial court’s ruling on a Rule 60(b) motion unless
an abuse of discretion is demonstrated.”5 “We will find an abuse of discretion when
the decision on review is manifestly unreasonable.” 6
      DISCUSSION
      A.     Granting Relief Under Civil Rule 60(b)(1) Was An Abuse Of
             Discretion.
             Civil Rule 60(b) permits a court “[o]n motion and upon such terms as are
just” to “relieve a party . . . from a final judgment, order, or proceeding.” 7 The purpose
of the rule “is to provide relief from judgments which, for one reason or another, are
unjust.”8 Subsection (1) of the rule allows relief on the basis of “mistake, inadvertence,
surprise or excusable neglect.” “These grounds for relief are quite broad [—] they

such filings timely by extending the time for filing to the next business day when the
court is closed for all or part of the day on the original filing deadline.
      5
            Fernandez v. Fernandez, 358 P.3d 562, 565 (Alaska 2015) (quoting
Morris v. Morris, 908 P.2d 425, 427 (Alaska 1995)).
      6
             Id. (quoting Ranes & Shine, LLC v. MacDonald Miller Alaska, Inc., 355
P.3d 503, 508 (Alaska 2015)).
      7
             Alaska R. Civ. P. 60(b).
      8
            Fernandez, 358 P.3d at 566 (quoting Wellmix, Inc. v. City of Anchorage,
471 P.2d 408, 411 n.13 (Alaska 1970)).

                                           -7-                                       7652
would encompass a case where an error of law had been made by counsel or by the
court . . . .”9 We will assume for the purposes of this appeal that there were errors in
the superior court’s August 2019 grant of the defendants’ motion to enforce settlement.
             We conclude, however, that it was error to treat McDonald’s Rule 60(b)
motion, filed nearly a year later, as timely.10 The rule provides that motions for relief
from judgment “shall be made within a reasonable time,” and motions for relief under
subsection (1) must be made “not more than one year after the date of notice of the
judgment or orders” being challenged. But a Rule 60(b) motion “is not considered
timely just because it is filed within the one-year time limit”; it must also “be filed
within a reasonable time.” 11
             In Alaska Truck Transport, Inc. v. Berman Packing Co. we considered
what a reasonable time would be in the context of Rule 60(b)(1), weighing the
“competing interests of finality and correcting injustice.” 12 To achieve the appropriate
balance, we decided that Rule 60(b) motions based on errors of law should typically be

      9
            Alaska Truck Transp., Inc. v. Berman Packing Co., 469 P.2d 697, 698-99
(Alaska 1970).
      10
             Architects Alaska and BBFM observe that Judge Matthews’s order “does
not discuss defendants’ timeliness arguments or make any explicit finding that the
motion to vacate was timely filed” aside from “not[ing] the defendant’s arguments that
it was untimely and that it was filed one day before the one-year deadline.” But in
granting the motion the court implicitly found it to be timely.
      11
              In re USN Commc’ns, Inc., 288 B.R. 391, 396 (Bankr. D. Del. 2003); see
also Felts v. Accredited Collection Agency, Inc., 267 F.R.D. 377, 380 (D.N.M. 2010)
(“The one-year time frame is an outer limit that is secondary to the requirement that the
motion be made within a reasonable time.”); In re New England Mut. Life Ins. Co. Sales
Practices Litig., 204 F.R.D. 6, 11 (D. Mass. 2001) (“It is well-established that the one-
year limitation period is an outer limit, and that even a motion brought within a year
should be rejected if not made within a reasonable time.”).
      12
             469 P.2d at 699-700.

                                          -8-                                      7652
filed within 30 days of judgment. 13 The 30-day benchmark ensures that “Rule 60(b) is
neither a substitute for an appeal nor a device for obtaining an extension of time for
filing an appeal.”14
             We also recognize, however, that in “compelling circumstances” the 30­
day requirement may be relaxed “where the demands of justice require it.” 15 It is
appropriate to consider, as Judge Matthews did, the fact that McDonald was not
represented by counsel when Judge Aarseth signed the order enforcing the settlement.
Although self-represented litigants are no less expected to comply with procedural
deadlines,16 their self-represented status may permit a court to relax the 30-day
requirement if that status creates “compelling circumstances.”17
             McDonald asserted that he did not take immediate action after Judge
Aarseth’s order because he was not sure how to proceed and thought there was “nothing

      13
               Id. McDonald argues that Judge Aarseth issued no final judgment
consistent with Alaska Civil Rule 58(2)’s requirement that “[e]very judgment must be
set forth on a separate document distinct from any findings of fact, conclusions of law,
opinion, or memorandum,” and thus “an appeal would be early or still allowed.” Alaska
R. Civ. P. 58. “To determine whether a decision is a final judgment that triggers the
time limit for an appeal, ‘the reviewing court should look to the substance and effect,
rather than form, of the rendering court’s judgment.’ ” Richard v. Boggs, 162 P.3d 629,
633 (Alaska 2007) (quoting Denali Fed. Credit Union v. Lange, 924 P.2d 429, 431
(Alaska 1996)). “A ‘final’ judgment is one that disposes of the entire case and ends the
litigation on the merits.” Id. (quoting Mattfield v. Mattfield, 133 P.3d 667, 673 (Alaska
2006)). In granting the motion to enforce the settlement, Judge Aarseth wrote, “IT IS
HEREBY ORDERED that this action shall be dismissed with prejudice, each party to
bear its own costs and attorney[’s] fees.” The court’s intent was clear; the order was a
final judgment for purposes of triggering the time for appeal.
      14
             Rowland v. Monsen, 135 P.3d 1036, 1040 (Alaska 2006).
      15
             Alaska Truck Transp., Inc., 469 P.2d at 700.
      16
              See Sandoval v. Sandoval, 915 P.2d 1222, 1223-24 (Alaska 1996)
(affirming trial court decision denying a self-represented litigant’s Rule 60(b)(1) motion
for excusable neglect when motion was filed almost a year after final judgment).
      17
             See Alaska Truck Transp., Inc., 469 P.2d at 700.

                                           -9-                                      7652
that [he] could do past that point.” He said he began to “look into these issues” in March
2020 after discovering how a settlement of his civil case complicated his worker’s
compensation case. He explained that after he “reviewed everything, and then . . .
discovered . . . the accusation that . . . [Ms. Elsner] had accepted a settlement,” he “spent
a lot of time researching . . . the case law and the various things” and “it took [him] a
while to actually fashion . . . [his] argument.” He explained that he “wanted to make
sure [he] didn’t leave anything out[] [a]nd so it took [him] several months to actually
finish . . . the [Rule 60(b)] motion.”
              Architects Alaska and BBFM counter that McDonald knew the basis of
their motion to enforce settlement when it was filed in July 2019. It is undisputed that
he received mailed and emailed copies of the motion and its attachments, though he
claims he did not understand what the motion meant. Whether or not he understood its
import, the record shows that he was urged to act in December 2019, when he spoke
with his former attorney Ehrhardt and acknowledged the immediate need to try to set
aside the ruling. His conversation with Seville three months later, in March 2020,
reinforces a conclusion that he not only knew he should act to challenge the ruling but
intended to do so. Yet another five months went by without action on his part.
              We are sympathetic to McDonald’s contention that as a self-represented
litigant it took him “a while to actually fashion . . . [his] argument.” But he has not
presented “compelling circumstances” that explain why it took him so much longer than
the 30 days allowed most litigants for attacking a legal ruling. If pro se status alone
were a “good reason” for failing to act within a reasonable time, Rule 60(b)’s
“reasonable time” limitation would never apply to self-represented litigants.18 While

       18
              See Sandoval, 915 P.2d at 1224 (finding that litigant’s self-represented
status did not excuse nearly one-year delay, noting that “[w]hen he was unable to retain
an attorney, he took no action at all on his case: neither filing a motion [self­
represented], nor seeking pro bono legal assistance, nor even communicating with the
court in any way” (emphasis omitted)).

                                           - 10 -                                      7652
the “demands of justice” standard for relaxing the 30-day requirement is elastic, it
cannot allow McDonald nearly a year to challenge a legal ruling he knew from the start
had adverse consequences and needed his urgent attention. We conclude, therefore,
that it was an abuse of discretion to grant McDonald relief from judgment under Rule
60(b)(1).
      B.     Granting Relief Under Civil Rule 60(b)(6) Was Also An Abuse Of
             Discretion.
             The superior court found that McDonald was entitled to relief not only
under Rule 60(b)(1) but also, in the alternative, under Rule 60(b)(6), although
McDonald did not specifically request relief under this subsection. Subsection (6)
supplements Rule 60(b)’s five specific grounds for relief by permitting a court to grant
relief for “any other reason justifying relief from the operation of the judgment.” 19 The
application of Rule 60(b)(6) is reserved for “extraordinary circumstances.” 20 “Relief
under this clause is not limited by any strictly defined time period, but may be granted
if the motion is made within a ‘reasonable’ time.” 21
             As explained above, the record does not justify a conclusion that this case
involved “extraordinary circumstances” that could make McDonald’s nearly one-year
delay “a ‘reasonable’ time.” Furthermore, we have consistently held that “[a] party may
only obtain Rule 60(b)(6) relief if no other Rule 60(b) clause applies.”22 Because
McDonald could have brought a timely motion for relief under Rule 60(b)(1) based on

      19
            Chena Obstetrics & Gynecology, P.C. v. Bridges, 502 P.3d 951, 960
(Alaska 2022) (citing Alaska R. Civ. P. 60(b)).
      20
             O’Link v. O’Link, 632 P.2d 225, 229 (Alaska 1981).
      21
             Id.
      22
             Richard v. Boggs, 162 P.3d 629, 635 (Alaska 2007).

                                          - 11 -                                    7652
alleged errors of law,23 Rule 60(b)(6) could not apply, and it was an abuse of discretion
to grant relief on this alternative ground.
       CONCLUSION
              The order granting McDonald’s Civil Rule 60(b) motion for relief from
judgment is REVERSED.

       23
            See Alaska Truck Transp., Inc. v. Berman Packing Co., 469 P.2d 697, 698­
99 (Alaska 1970).

                                              - 12 -                               7652