John Bradley and Lisa Bradley v. Yellowstone Trails Ranch Owners’ Association

Summary

The Montana Supreme Court affirms the District Court’s order setting aside a default judgment against the Yellowstone Trails Ranch Owners’ Association. The court holds that the Association’s acknowledgment of service constituted an appearance, triggering the seven-day notice requirement for a motion for default judgment under Montana Rule of Civil Procedure 55(b)(2). Because the District Court entered judgment the day after the motion was served, the judgment was premature and voidable.

Holdings

1. A defendant’s filed acknowledgment of service expressly stating that it enters a voluntary appearance constitutes an appearance under section 25-3-401, MCA, and triggers the defendant’s right to notice of a motion for default judgment under Montana Rule of Civil Procedure 55(b)(2).
2. When Rule 55(b)(2) requires notice, a court must refrain from ruling on a motion for default judgment for seven days even if no hearing is scheduled; entering judgment the next day renders the judgment premature and voidable.
3. The District Court reached the correct result in setting aside the default judgment because the premature entry of judgment, together with the Association’s demonstrated intent to defend and prompt response, justified relief; the Supreme Court therefore affirmed without deciding whether the District Court correctly applied the Rule 60(b)(1) excusable-neglect test.

Questions Presented

1. Whether the Association’s acknowledgment of service, which expressly stated that it entered a voluntary appearance, constituted an appearance triggering Montana Rule of Civil Procedure 55(b)(2)’s seven-day notice requirement.
2. Whether the District Court’s entry of default judgment one day after the application, without allowing the required seven-day period, rendered the judgment premature and justified setting it aside.
3. Whether the District Court manifestly abused its discretion by setting aside the default judgment.

Disposition

affirmed