Court Opinion

ID: 882344
Source: CourtListenerOpinion
Date Created: 2013-06-05 01:09:40.09405+00
Date Added: 2024-06-11T12:39:27.488813
License: Public Domain

No.    92-100
            IN THE SUPREME COURT OF THE STATE OF MONTANA
                                        19 92

CREDIT ASSOCIATES, INC.,
            Plaintiff and Respondent,
     -vs-
DAVID C , MOGAN,
                                                      -LE.-<k   gF S U P R E M E COURT
            Defendant and Appellant.                      STA J E OF MONTANA

APPEAL FROM:       D i s t r i c t Court of t h e 1 7 t h J u d i c i a l District,
                   In and for t h e County of Valley,
                   The Honorable Leonard H. Langen, Judge presiding.

COUNSEL OF RECORD:

            For Appellant:
                   David C. Mogan, Pro Se, Hinsdale, Montana
            For Respondent:
                   Dirk L a r s e n , Larsen and Neill, G r e a t Falls, Montana

                                        Submitted on Briefs:             July 30, 1992
                                                      Decided:           December 3 , 1992
Filed:
Justice John Conway ~arrisondelivered the Opinion of the Court.

    This is an appeal from the Seventeenth Judicial District,
Valley County, the Honorable Leonard Lanqen presiding. The matter
was tried without a jury and the appellant David C. Mogan (Mogan)
appeals from the order and judgment.     We affirm.
     The issues presented for review are:
     1.    Whether the District Court erred when it struck out
Mogantscounterclaim and third party complaint and prevented Mogan
from seeking relief thereon.
     2.    Whether the District Court erred when it awarded $5,198.99
pursuant to Rule 37 (c), M.R.Civ.P., for the purported failure of
Moqan to admit the genuineness of certain documents submitted by
respondent Credit Associates, Inc.
     The dispute herein lies in Mogants failure to pay certain
charges made on credit cards that he obtained from two companies:
the Sinclair Oil Company and Tandy Credit/Radio Shack. These cards
were used to charge merchandise in the amount of $1,402.57
(Sinclair) and $5,102.86 (Tandy)   .   No payment was made on either
balance.     These amounts were subsequently assigned to Credit
Associates, Inc. for collection and this action was filed.
     Thereafter, Mogan filed a motion to vacate service of process
on the grounds that the sheriff failed to exhibit the original
summons to Mogan personally and instead served him with a copy of
the summons. Mogan failed to pay the required $40 filing fee, but
the court clerk filed his motion without it.          Electing not to
strike the motion, as he was authorized to do, Judge Langen entered
the following order on December 20, 1989:
     1.   The Defendant's Motion to Vacate Service is denied.
     2.   The Defendant shall pay the $40.00 filing fee.
     3. The Defendant has 10 days within which to serve and
     file his Answer.
     4. The Clerk of Court is ordered to accept no further
     papers from this Defendant, or for that matter from any
     party, without payment of filing fees as required under
     5 25-10-403, MCA.
     The court found Mogan's Motion to Vacate Service 'Itotally
without meritt1because Rule 4D(2), M.R.Civ.P., requires only that
"a copy of the summons and of the complaint" be delivered to the
defendant.     The court reduced the time for filing an Answer from
twenty days to ten as "a small penalty for this Defendant trying to
escape the entry of a Default by nonpayment of the filing fee and
through filing of a spurious pleading."
     On March 14, 1990, Mogan filed a "Motion to Reconsider and
Memorandum in Support Thereof Concerning Defendant's Motion to
Vacate Servicettand a "Motion for Reconsideration of Order dated
12-20-89 and Request for Oral Argument."    On July 2, 1991, Judge
Langen responded in a "Memorandum Opinion and Order" from which we
quote :
     This is really a very simple case. . .          . Credit
     Associates, Inc., Plaintiff [Respondent] has attemptedto
     collect the sum of $6,743.36 from Mogan.      Instead of
     complying with my order of December 20, 1989, and filing
     his Answer, [Mogan] has barraged the Clerk of Court with
     a barrage of so-called legal documents, which included a
     Motion to Reconsider, a Motion for Oral Argument, a
     Motion for Partial Summary Judgment, and a few others.
     .    ..
           Accompanying these Motions are so-called Briefs.
     In none of these Briefs does Moqan denv that he owes the
     amount. [Emphasis added.]
Judge Langen went on to say that he did not intend to spend any
more time reviewing the "irrelevant, foolish and trivial pleadingstt
that Mogan had filed in this case, and that "either Mogan owes the
$6,743.36 prayed for in the [Credit Associatest] Complaint, or he

owes part of it, or he doesn't owe any part of it."        The court then
set the matter for a non-jury trial and ordered Mogan to file his
answer in ten days or a default judgment would result.         A copy of
Judge Langents July 2, 1991 Order is attached as an Appendix to
this Opinion.
     On July 12, 1991, Mogan filed an Answer, Counterclaim and
Third Party Complaint, along with a demand for a jury trial
(withdrawn by Mogan in December 1991).             In his order dated
September 3, 1991, setting the case for jury trial on October 25,
1991, Judge Langen noted that Mogan had disobeyed his previous

order by filing a counterclaim and third party complaint, raising
"the same frivolous issues" referred to in the court's Memorandum
Opinion and Order of July 2, 1991.          The September 3, 1991 Order
also stated that "the attempt of the Defendant to raise these
additional frivolous issues contrary to the Court's Order dated
July 2nd, shall subject the Defendant to Rule 11 Sanctions."
     The September 3, 1991 order struck Mogan's counterclaim and
third party complaint and limited the issues to be tried by jury as
follows:
     [Moganls] Answer constitutes a general denial of the
     Plaintiff's Complaint and shall remain as a pleading.
     The Complaint and Answer frame the issues to be tried
     before the jury. No other issues shall be submitted to
     the iurv. [Emphasis added.]
     After numerous other actions filed by Mogan, including a
demand for a twelve-person jury, which was denied pursuant to 5 3-
15-106,    MCA,   and   an   unsuccessful   attempt   to   disqualify   or
substitute the district judge, the matter was finally tried to the
court sitting without a jury on December 19, 1991, where Mogan
appeared pro se. The court heard testimony and examined the proof
offered by the respective parties.       It found that Mogan owed
Tandy/Radio Shack $5,072.85 and Sincfair Oil Corporation $1,402.57,
plus interest computed from April 18, 1989 on both accounts, and
that these claims had been assigned to Credit Associates, Inc.
Finding that Credit Associates was entitled to a reasonable
attorney's fees under the terms of the credit card agreements and
to attorney s fees and expenses pursuant to Rule 37 (c), M. R.Civ.P.,
the court directed that judgment be entered in favor of credit
Associates, Inc. in the amount of $13,181.78. This total includes
$2,858.43 for attorney's fees and attorney's expenses; $2,040.56
for witness expenses, and $139.40 for costs and fees.      The court
reduced attorney's fees by $300 because some of the copies of
charge slips sent to Mogan were illegible.
     We affirm this judgment and conclude that the ~istrictCourt
properly denied the counterclaim and third-party complaint because
they were frivolous. Because Mogan failed to admit the genuineness
of the documents supporting Credit Associates' claims, which were
later proved genuine, we also hold that the court properly awarded
attorney's fees and witness expenses pursuant to Rule 37(c).

We concur:

       Chief Justice
Justices
                                                          CFFICE CLERK OF INSTRICT COUm
                                                                 VALLEY COUNTY
        A P P E N D I X TO NO. 9 2 - 1 0 0                         f ILED

  MONTANA SEVENTEENTH JUDICIAL DISTRICT COURT, VALLEY COUNTY

CREDIT ASSOCIATES, INC.                            Valley County
                                                     Cause No. 16826
                    Plaintiff,

DAVI9 C. MOGAN,
                    Defendant.                   MEMORANDWM OPINION
                                                 AND ORDER

DAVID   C . MOGAN,

                    Third Party
                    Plaintiff,

SINCLAIR OIL CO., COLLECTION
CENTER OF WYOMING; CREDIT
ASSOCIATES, INC., of GREAT FALLS;
TANDY CREDIT/RADIO SHACK; W S E N
& NEILL and DIRK LARSEN,

                      Third Party
                      Defendants.

            O n July 1 , 1 9 9 1 , I spent several hours reviewing this

file.
            The last time I had completely r e v i e w e d this fife was
on December 20, 1989.                 on that date I prepared a Memorandum
Opinion and O r d e r ~ e n y i n gMoganis Motion to Vacate Service of
Process.

                               APPENDIX- 2
         This Memorandum Opinion was prepared in connection with
Mogan's "SPECIAL MOTION TO VACATE SERVICE AND MEMORANDUM IN
SUPPORT THEREOF."    Mogan had argued that I should make a Court
Order vacating the service of process upon him on the grounds
that the Sheriff had failed to personally exhibit to Mogan the
original Summons, and instead had only served him with a copy
of the Summons.
         I denied this Motion, and Ordered as follows:

(1)      Defendant's Motion to Vacate Service is denied.

(2)      Defendant shall pay his $40.00 filing fee forthwith.

(3       The Defendant has 10 days within which to serve and
file his Answer.

(4)      The Clerk of this Court is Ordered to accept no further
papers from the Defendant, or for that matter from any party,
without the paying of filing fees as required under
Sec. 25-10-403, M.C.A..
         This is really a very simple case.   In this case, the
Credit Associates, Inc.,   Plaintiff, has attempted to collect
the sum of about $6,743.36 from Mogan.
         Instead of complying with my Order of December 20,
1989, and filing his Answer, Defendant has barraged the Clerk

of Court with a barrage of so-called legal documents, which
include a Motion to Reconsider, a Motion for Oral Argument, a
Motion for Partial Summary Judgment, and a few others that I
can't remember.
         Accompanying these Motions are so-called Briefs.    In

                     APPENDIX- 2
none of these Briefs does Mogan deny that he owes the amount.
          Instead, Defendant has long arguments claiming that the
Plaintiff violated 15   U.S.C.,   Sec. 1692 (e) 9.   He quotes from
an ABA ~ecision, C-735/ Informal Ethics opinions (ABA) 323
(1975).

          He wants me to take judicial notice of the fact that
the Plaintiff Is Complaint was prepared by a "lay personu who was
not authorized to practice         law, and that this has been
specifically prohibited by enactments of the Congress of the
United States.
          He goes into some detail about the legislative history
of F . D.C.P.A., which was signed at a White House Ceremony on
September 20, 1977, and became law on March 20, 1978.
          Mogan points out that Congressman Annunzio sheparded
the original bill and its successors through several redrafts
and through years of debate and negotiation.
          This Defendant, David Mogan, is not new to the Montana
Seventeenth Judicial District Court.          Defendant has filed
numerous lawsuits in the counties making up the Seventeenth
Judicial District.      Generally, he appears Pro Se.
          His pleadings generally follow an established modus
operandi consisting mainly of filing a barrage of irrelevant

pleadings which can totally engulf the Court system.        If the
presiding Judge were to attempt to read all of these documents
and attempt to answer them, it would engulf the system.
          Most of Moganis cases are not of great consequence, and

                     APPENDIX-    3
in t h e ordinary c o u r s e of business, the above-entitled case
should be handled quite quickly.
           However, t h i s is impossible in any case involving David
Mogan.         Judge Thomas, who has a very patient, kindly
disposition, finally had enough.         He placed Mogan in jail for
more than a week in order t o convince Mogan to stop his dilatory
methods.

           Only time will tell whether Judge Thomas9 use of jail
has induced Mogan to improve his conduct before this Court.
           I have just spent several hours reviewing the above
captioned case file     -   time which I shouLd have been spending

on other more important cases which are terribly delinquent
because of my inability to find the t i m e t o handle them.
           I do not intend to spend any more time on this case in
the review of such irrelevant, foolish and trivial pleadings as
Mogan has filed in this lawsuit,
           When I reviewed this file on Gecember 20, 1989, I
anticipated that this file could conceivably triple in volume
if I failed to take some action.          I could have a p p l i e d money
sanctions on the Rule 11, M.R. C. P., or possibly found reason to
use jail incarceration under the Contempt power of the Court.
Instead, 3 exercised a simple procedure.
           I told the Clerk not to file any more of Moganfs
documents in this fife.       She h a s been i n s t r u c t e d to keep them

in a separate file f o l d e r , unfiled, and labeled as Civil File
No. 16826CR.      I leave it to your imagination as to the origin
of the letter CR.
         This is a simple case.     Either Defendant Mogan owes
the $6,743.36 prayed for in Plaintiff's Complaint, or he owes
part of it, or he doesn't owe any part of it.
         I think we can solve this issue very simply.
         THEREFORE, IT IS ORDERED as   ~ O ~ ~ O W S :

(1)      Defendant has 10 days within which to file his Answer,
which shall admit or deny that he owes the sum or sums alleged
in Plaintiff's Complaint.

(2)      If Mogan fails to file an Answer within this time, I
shall Order that Defendant's Default be entered.
(3)      That this case be set for trial before the Court,
without a jury, to commence at 9:00 A.M. on Tuesday, the 13th
day of August, 1991, in the Courtroom of the Valley County
Courthouse at Glasgow, Montana.
         DATED this 2nd day of July, 1991.

                            ~ u d g e the bistrictj ~our/t
                                     of

                    APPENDIX- 5
Justice Karla M. Gray, concurring in part and dissenting in part.

     I concur in the opinion of the majority on issue two.                I
dissent from that opinion, however, on issue one.             As we recently
stated in Grenz v. Fire and Cas. of Connecticut (Mont. 1992), -

     We must be ever vigilant        .      .
                                  . in ensuring that human
     propensities to frustration over seemingly endless
     litigation do not result in less than the full and fair
     consideration on legal principles to which litigants are
     entitled in Montana's courts.
Neither the District Court nor the majority of this Court offers
any legal authority or support for the action taken with regard to
Mogan's pleadings.        It appears that the dismissal of those
pleadings   was   based   on   the       District   Court's   understandable
frustration rather than on a full and fair consideration of
applicable legal principles.     I cannot agree.
Justice Terry N. Trieweiler dissenting.
      I dissent from the opinion of the majority.

      The arbitrary manner in which the District Court dismissed the
defendant's     counterclaim       and   third-party   complaint   violated
Montana's Rules of Civil Procedure and defendant's constitutional
right to due p r o c e s s .     It was as clear an abuse of judicial
authority as I have seen.
      While the majority may approve of the result accomplished,
that is no excuse for ignoring the law and the facts in this case.
      Plaintiff filed its complaint on September 14, 1989.               In
response to the complaint, defendant filed a motion to vacate
service for t h e reason that defendant felt he had n o t been served
correctly with the summons and complaint.          That motion was denied
on December 20, 1989.          Defendant subsequently moved to reconsider
the denial of his motion and filed several additional motions.
Instead of simply granting or denying those motions on their
merits, the District Judge entered a five page written tirade
berating the defendant for taking up his time which could better be
spent on other matters-          Tn his opinion dated J u l y 2, 1991, t h e
~istrictJudge stated:
           I have just spent several hours reviewing the
      above-captioned case file - time which I should have been
      spending on o t h e r more important cases which are terribly
      delinquent because of my inability to find the time to
      handle them.
           I do not intend to spend any more time on this case
      in the review of such irrelevant, foolish and trivial
      pleadings as Mogan has filed in this lawsuit.
         This is a simple case. Either defendant Mogan owes
    the $6743.36 prayed for in Plaintiff's Complaint, or he
    owes part of it, or he doesn't owe any part of it.
          I think we can solve this issue very simply.
          THEREFORE, IT IS ORDERED as follows:
         (1) Defendant has 10 days within which to file his
    Answer, which shall admit or deny that he owes the sum or
    sums alleged in Plaintiff's Complaint.
     Mogan complied with the District Court's order and filed his
answer on July 12, 1991.    With his answer he filed a counterclaim
and a third-party complaint.         In his answer, he asserted the
affirmative defense that the complaint failed to state a claim upon
which relief could be granted, and also denied the allegations
which were made in plaintiff's complaint.
     For his counterclaim, defendant alleged that plaintiff had
violated the Fair Debt Collection Practices Act found at 15 U.S.C.
5 1692 (1977). That Act prohibits certain activities by collection
agencies and provides a cause of action for violations of the Act.
Pursuant to 15 U.S.C. 5 1692k(d) (1977), a claim for violation of
the Act can be brought in either federal or district court.
Pursuant to the Montana Rules of Civil Procedure, this claim, if
related   to   the   collection of    this debt, was   a   compulsory
counterclaim; and pursuant to the statute of limitations provided
for in the Federal Act, it had to be brought within one year from
the time that the violation occurred.
     Defendant's counterclaim also alleged that the merchandise
which was the consideration for the debt plaintiff alleged was not
merchantable;   and   that    the   merchants   which   the   plaintiff
represented had not acted in good faith.
     Regardless of whether Mogan had a history of being involved in
prior litigation, or whether he was considered a nuisance by this
particular District Judge, he had a right under our rules of civil
procedure and under Article 11, 5 17, of the Montana Constitution,
to due process of law. In the Seventeenth Judicial District Court,
in Valley County, Montana, he received none.
     Without the benefit of any discovery, or any motion to dismiss
the counterclaim and third-party complaint, and without the benefit
of any briefing or argument, the District Court acted suasportte on

September 3, 1991, to dismiss both the counterclaim and the
third-party complaint.       In its order, the District Court simply
stated:
          The Counterclaim and Third Party Complaint raised
     the same frivolous issues referred to in my Memorandum
     Opinion and Order dated July 2, 1991; and therefore,
     shall be stricken.
          Furthermore, the attempt of the Defendant to raise
     these additional frivolous issues contraryto the Court's
     Order dated July 2nd, shall subject the Defendant to
     Rule 11 Sanctions.
     There is no authority for the District Judge's conclusion that
the counterclaim and third-party complaint are frivolous. There is
no basis in the record for any conclusion that they are frivolous,
and the District Judge did not bother to offer any rationale for
arriving at his conclusion.
     I have heard of frontier justice, but this is ridiculous.
There is no basis in this record for affirming the actions of the
~istrictCourt.
     The majority finds it noteworthy that defendant's counterclaim
and third-party complaint were prohibited by the District Courtls
memorandum opinion entered on July 2, 1991. However, there is no
explanation for why the District Judge had any authority to
preclude defendant from filing his counterclaim and third-party
complaint in the earlier memorandum.
     The majority simply repeats the District Courtfs conclusion
that the   issues raised by    the counterclaim were     frivolous.
However, nowhere in the majority opinion nor in the District Court
orders is there any explanation of why the counterclaim and
third-party complaint were frivolous.    Apparently the theory is
that if the court says it is frivolous, it is frivolous, However,
it seems to me that the party whose claims have been dismissed has
a right to some explanation of the manner in which his pleading is
defective so that he can cure it, if possible.         There is no
explanation here because there was      no   record   upon which   a
conclusion could be drawn that the pleadings were frivolous.
     1 suppose that our rules of civil procedure can be cumbersome

and an imposition on district courts, and that justice would be
more expeditious if w e deferred completely in every case to the
District Judge's gut reaction. However, it appears to me that our
rules of civil procedure have served us well in the past and should
not be abandoned on this occasion simply because the Judge in the
Seventeenth ~ u d i c i a l~ i s t r i c h a s 'lother more important casesf1with
                                         t
which to concern himself.

      For these r e a s o n s , I dissent from t h e o p i n i o n of t h e majority.

     Justice William E. H u n t , Sr. , concurs in t h e foregoing d i s s e n t
of Justice Trieweiler.

                                                   Justice
i                                      December 3, 1992
I
                                 CERTIFICATE OF SERVICE

    I hereby certify that the following order was sent by United States mail, prepaid, to the
    following named:

    David C. Mogan
    P.O. Box 366
    Hinsdale, MT 59241

    Dirk Larsen
    Attorney at Law
    P.O. Box 1692
    Great Falls, MT 59403

    Hon. Leonard H. Langen
    District Court Judge
    P.O. Box 1110
    Glasgow, MT 59230

                                                    ED SMITH
                                                    CLERK OF THE SUPREME COURT
                                                    STATE OF MONTANA