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Buck Blacktop, Inc. v. Gary Contracting and Trucking Company, LLC

Court of Appeals of Minnesota

May 6, 2019

Buck Blacktop, Inc., Respondent,
v.
Gary Contracting and Trucking Company, LLC, et al., Appellants.

          Ramsey County District Court File No. 62-CV-17-6741

          David S. Holman, The Law Office of David S. Holman, Ltd., Burnsville, Minnesota (for respondent)

          Timothy R. Maher, Joseph D. Kantor, Guzior Armbrecht Maher, Minneapolis, Minnesota (for appellants)

          Considered and decided by Johnson, Presiding Judge; Ross, Judge; and Jesson, Judge.

         SYLLABUS

         The four-part test stated in Finden v. Klass, 128 N.W.2d 748 (Minn. 1964), does not apply to a motion based on paragraph (f) of rule 60.02 of the Minnesota Rules of Civil Procedure.

          OPINION

          JOHNSON, JUDGE

         This appeal arises from a judgment that was entered after the filing of a confession of judgment that was executed more than four years earlier. The two parties who had executed the confession of judgment moved to vacate the judgment on the ground that the confession of judgment was filed after the statute of limitations had expired. The district court denied the motion after applying the four-part test stated in Finden v. Klass, 128 N.W.2d 748 (Minn. 1964). We conclude that the four-part Finden test does not apply to a motion based on paragraph (f) of rule 60.02 of the Minnesota Rules of Civil Procedure. Therefore, we reverse and remand.

         FACTS

         Gary Contracting and Trucking Company, LLC (hereinafter GCTC), which is owned by Gary Boryczka, is engaged in the construction business. Buck Blacktop, Inc., is in the paving business. In 2011, GCTC hired Buck Blacktop to perform paving on six construction projects. But GCTC did not pay Buck Blacktop for the work that it performed.

         In 2013, Buck Blacktop retained an attorney to collect the debt owed by GCTC. On May 21, 2013, after negotiations between the parties, Boryczka executed a confession of judgment in the amount of $51, 824.31 on behalf of GCTC and himself. The confession of judgment states that it was "made in conformity with Minn. Stat. § 548.22, for the purpose of settling and confessing judgment in this action." The confession of judgment also states that GCTC and Boryczka "consent to the immediate entry of judgment in the aforementioned amount and waive stay of execution thereon."

         Buck Blacktop did not immediately file the confession of judgment. The parties engaged in further discussions and agreed that GCTC could "work off" the outstanding debt on future construction projects. But, according to Buck Blacktop's president, "no such projects occurred." Neither GCTC nor Boryczka made any payments on the debt.

         On November 10, 2017, more than four years after GCTC and Boryczka executed the confession of judgment, Buck Blacktop filed it with the Ramsey County District Court. In an accompanying affidavit, Buck Blacktop requested that interest be added to the principal. On November 14, 2017, the district court administrator entered a judgment in favor of Buck Blacktop and against GCTC and Boryczka in the amount of $60, 871.02. The district court administrator sent notice of the judgment to GCTC, Boryczka, and Buck Blacktop. Boryczka actually became aware of the judgment in December 2017.

         On February 27, 2018, Buck Blacktop served a garnishment summons on a bank at which GCTC had an account. Buck Blacktop was able to seize $15, 612.81 in cash. The next day, GCTC and Boryczka served and filed a motion to vacate the November 14, 2017 judgment pursuant to rule 60.02 of the rules of civil procedure. In their memorandum of law, GCTC and Boryczka argued that they are entitled to relief under paragraphs (d) and (f) of rule 60.02 on the grounds that the confession of judgment was not timely filed within one year and that it does not comply with all statutory requirements. In response, Buck Blacktop argued that a one-year limitations period does not apply to the confession of judgment and that GCTC and Boryczka waived any argument that the confession of judgment does not comply with statutory requirements.

         In May 2018, after a hearing, the district court filed a seven-page order and memorandum in which it denied GCTC and Boryczka's motion to vacate the November 14, 2017 judgment. With respect to paragraph (f) of rule 60.02, the district court reasoned that GCTC and Boryczka satisfied the first requirement of the four-part Finden test because they have a reasonable statute-of-limitations defense and have reasonable defenses against the addition of interest and the form of the confession of judgment. But the district court reasoned that GCTC and Boryczka did not satisfy the second requirement of the Finden test because they knew that the confession of judgment could be filed at any time and did not establish a reasonable excuse for failing to pay their debt. The district court also reasoned that GCTC and Boryczka did not satisfy the third requirement because they did not act diligently in the three months following the entry of judgment. And the district court further reasoned that GCTC and Boryczka did not satisfy the fourth requirement because Buck Blacktop would be substantially prejudiced if the judgment were vacated. With respect to paragraph (d) of rule 60.02, the district court reasoned that, even if the judgment were erroneous, an erroneous judgment is not void. GCTC and Boryczka appeal.

         ISSUE

         Does the four-part test stated in Finden v. Klass, 128 N.W.2d 748 (Minn. 1964), apply to a motion based on paragraph (f) of rule ...


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