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Friday, August 21, 2015

Ind. Decisions - Supreme Court issues one opinion today

In The Huntington National Bank v. Car-X Assoc. Corp., an 11-page, 5-0 opinion, Justice David writes:

After suing a mortgagee to foreclose on a lien, junior creditor Car-X Associates Corporation (Car-X) obtained a default judgment against co-defendant and senior creditor Huntington National Bank (Huntington) after Huntington failed to timely respond to the complaint and summons. A few weeks later, Huntington filed a motion to set aside the default judgment, arguing that it was entitled to relief under Indiana Trial Rule 60(B)(1) because of its excusable neglect and under Indiana Trial Rule 60(B)(8) because such relief would be just and equitable under the circumstances. Finding that Huntington failed to establish either avenue of relief, the trial court denied its motion. The Court of Appeals, however, determined that Huntington had in fact proven the existence of excusable neglect and accordingly held that the trial court abused its discretion in deciding otherwise.

By their nature, cases involving claims of excusable neglect are highly fact sensitive. Here, the record reveals that the source of Huntington’s untimely response was that, in the absence of the employee who typically received service, a supervisor failed to refer the summons and complaint to counsel until after the deadline had passed. “This is neglect, but not excusable neglect as the term appears in Rule 60(B)(1).” Smith v. Johnston, 711 N.E.2d 1259, 1262 (Ind. 1999).

Thus, we find that the trial court did not abuse its discretion in denying Huntington’s motion to set aside Car-X’s default judgment on this basis. But this conclusion does not terminate Huntington’s appeal, for there is still the question of whether the denial of Huntington’s motion was just and equitable under the circumstances. To best answer this question, we remand this case to the trial court to reevaluate the motion under Trial Rule 60(B)(8), especially in light of Huntington’s meritorious defense to the underlying foreclosure suit (as Car-X concedes), the substantial amount of money involved, and Car-X’s lack of prejudice from the delay, among other considerations. * * *

We affirm the trial court’s denial of Huntington’s motion to set aside the default judgment under Trial Rule 60(B)(1) for excusable neglect but remand to the trial court to reconsider whether equitable reasons support granting Huntington’s motion under Trial Rule 60(B)(8).

Rush, C.J., Dickson, and Massa, J.J., concur.
Rucker, J., concurs in result.

Posted by Marcia Oddi on August 21, 2015 02:21 PM
Posted to Ind. Sup.Ct. Decisions