                             STATE OF MINNESOTA
                             IN COURT OF APPEALS
                                   A14-1747

                               Ferdinand Leo Gams, Jr.,
                                      Appellant,

                                          vs.

                               Steven Ronald Houghton,
                                     Respondent.

                              Filed August 24, 2015
                            Reversed and remanded
                                Rodenberg, Judge
                       Concurring specially, Connolly, Judge

                            St. Louis County District Court
                               File No. 69VI-CV-14-478

Kay Nord Hunt, Lommen Abdo, P.A., Minneapolis, Minnesota; and

Carver Richards, Honkanen Richards, S.C., Virginia, Minnesota (for appellant)

Jerome D. Feriancek, Ryan C. Stutzman, Thibodeau, Johnson & Feriancek, PLLP,
Duluth, Minnesota (for respondent)

      Considered and decided by Rodenberg, Presiding Judge; Connolly, Judge; and

Stauber, Judge.

                                   SYLLABUS

      1.     A party whose civil action is dismissed for failure to comply with the one-

year filing requirement of Minn. R. Civ. P. 5.04(a) may seek relief from the resulting

judgment under Minn. R. Civ. P. 60.02.

      2.     The rule-60.02 factors, as articulated in Hinz v. Northland Milk & Ice

Cream Co., 237 Minn. 28, 30, 53 N.W.2d 454, 456 (1952), are not elements to be proved
in order for a party to be entitled to relief under Minn. R. Civ. P. 60.02, but are instead

factors to be weighed by the district court in the circumstances of the individual case in

determining whether to grant relief from a judgment or order.

                                      OPINION

RODENBERG, Judge

       Appellant’s personal-injury action was dismissed pursuant to Minn. R. Civ. P.

5.04(a) because it was filed in district court more than one year after the action was

commenced by service. The district court denied appellant’s request for relief under

Minn. R. Civ. P. 60.02, concluding that such relief from a judgment of dismissal under

rule 5.04(a) is not available and, alternatively, that appellant failed to “prove all four

elements” for rule-60.02 relief even if such relief were to be considered available.

Because we conclude that rule 60.02 applies to judgments entered pursuant to rule

5.04(a) and that the district court erred in its alternative holding applying rule 60.02, we

reverse and remand for the district court to evaluate whether relief should be granted.

                                         FACTS

       On January 14, 2012, appellant Ferdinand Leo Gams, Jr., and respondent Steven

Ronald Houghton were involved in a physical altercation at appellant’s home.              On

March 22, 2013, appellant sued respondent by service of a summons and complaint,

alleging negligence and assault and battery. Consistent with Minnesota’s pocket-filing




                                             2
rule,1 appellant did not file his summons and complaint at the time that he commenced

the action.

       Respondent answered the complaint, and the parties actively litigated the case

throughout the balance of 2013 and the first part of 2014. Discovery was exchanged, and

the parties were deposed.         In May 2014, counsel for the parties exchanged

correspondence about the possibility of stipulating to damages in an effort to advance

settlement efforts.

       On July 15, 2014, after a period of no communication between counsel,

respondent’s counsel sent a letter to appellant’s counsel advising that appellant did not

appear to have filed the action in district court by July 1, 2014, and that, under the

amendments to Minn. R. Civ. P. 5.04 that took effect on that date, appellant’s complaint

was deemed to be dismissed with prejudice.          The letter from respondent’s counsel

apparently crossed in the mail with a letter from appellant’s counsel, dated July 17, 2014,

inquiring about the status of settlement efforts.

       Appellant’s counsel filed the summons and complaint on August 7, 2014. The

district court issued an order dismissing the action pursuant to Minn. R. Civ. P. 5.04(a),

and judgment was entered. Appellant’s counsel then moved the district court to vacate

the judgment.

1
  Minnesota’s rule concerning commencement of a civil action provides that a “civil
action is commenced . . . when the summons is served . . . .” Minn. R. Civ. P. 3.01(a).
The practice of permitting a civil action to be commenced without filing any documents
with the court has been referred to as “pocket filing.” See generally Laura A. Moehrle &
John A. Sullivan, Rule 5.04: Does it Really Mean What It Says?, Spring 2015, MN
Defense, at 13.

                                              3
         The district court denied the motion to vacate. The district court held that “Minn.

R. Civ. P. 60.02 does not apply to a Minn. R. Civ. P. 5.04 dismissal.” The district court

further stated, without analysis, “[t]hat even if Minn. R. Civ. P. 60.02 did apply in the

instant case, [appellant] did not prove all four elements in analyzing whether to grant

relief in vacating a dismissal with prejudice pursuant to Minn. R. Civ. P. 60.02.”

         This appeal followed.

                                          ISSUES

I.       When a judgment is entered pursuant to Minn. R. Civ. P. 5.04(a), may a party seek
         relief from that judgment under Minn. R. Civ. P. 60.02?

II.      Did the district court abuse its discretion by denying relief from judgment in this
         case?

                                        ANALYSIS

         Civil actions in Minnesota are commenced by service. Minn. R. Civ. P. 3.01.

Historically, the rules did not provide a deadline for filing an action in district court. By

order dated February 12, 2013, the Minnesota Supreme Court amended Minn. R. Civ. P.

5.04, effective July 1, 2013, to provide that any non-family action not filed within one

year of commencement “is deemed dismissed with prejudice against all parties unless the

parties within that year sign a stipulation to extend the filing period.”             Order

Promulgating Corrective Amendments to Rules of Civil Procedure & General Rules of

Practice Relating to Civil Justice Reform Task Force, No. ADM10-8051 (Minn. Feb. 12,

2013).      On May 8, 2013, the supreme court issued an order providing that,

notwithstanding the July 1, 2013 effective date, “no action shall be involuntarily



                                              4
dismissed pursuant to Minn. R. Civ. P. 5.04 until one year after the effective date.”

Order Relating to Civil Justice Reform Task Force, Authorizing Expedited Civil

Litigation Track Pilot Project, & Adopting Amendments to Rules of Civil Procedure &

General Rules of Practice, No. ADM10-8051 (Minn. May 8, 2013). Accordingly, the

amended rule 5.04 did not take full effect until July 1, 2014.

       Appellant challenges the district court’s conclusion that relief is not available

under rule 60.02 when an action is dismissed pursuant to rule 5.04(a), and its alternative

conclusion that appellant has not established entitlement to relief under rule 60.02, even

if the rule is available. We address each argument in turn.2

                                             I.

       Appellant asserts that the district court erred by concluding that, when an action is

dismissed and judgment is entered pursuant to rule 5.04(a), a party may not obtain relief

under Minn. R. Civ. P. 60.02.3 We review de novo the district court’s interpretation of


2
  Appellant also challenges the constitutionality of rule 5.04(a). Because we conclude
that the district court erred in applying rules 5.04(a) and 60.02, we do not reach
appellant’s constitutional arguments. See In re Senty-Haugen, 583 N.W.2d 266, 269 n.3
(Minn. 1998) (“It is well-settled law that courts should not reach constitutional issues if
matters can be resolved otherwise.”); Charson v. Temple Israel, 419 N.W.2d 488, 492-93
n.7 (Minn. 1988) (declining to reach due-process challenge to local rule providing for
dismissal with prejudice because relief was granted under rule 60.02).
3
  Beyond his assertions that the plain language precludes relief, respondent asserts that
relief cannot be available under rule 60.02 because rule 5.04(a) does not require entry of
judgment. But there is no dispute that, in this case, judgment was entered. And we
decline to address in this appeal a hypothetical case in which judgment is not entered.
See City of W. St. Paul v. Krengel, 748 N.W.2d 333, 338 (Minn. App. 2008) (noting that
“[a]ppellate courts decide only actual controversies and avoid advisory opinions”)
(quotation omitted), aff'd, 768 N.W.2d 352 (Minn. 2009).

                                             5
rules of civil procedure. Walsh v. U.S. Bank, N.A., 851 N.W.2d 598, 601 (Minn. 2014).

“When interpreting a rule, we look first to the plain language of the rule and its purpose.”

Id.   “Where the language is plain and unambiguous, that plain language must be

followed.” Id.

       The rules at issue here provide, in pertinent part:

              Any action that is not filed with the court within one year of
              commencement against any party is deemed dismissed with
              prejudice against all parties unless the parties within that year
              sign a stipulation to extend the filing period.

Minn. R. Civ. P. 5.04(a).

              On motion and upon such terms as are just, the court may
              relieve a party or the party’s legal representatives from a final
              judgment (other than a marriage dissolution decree), order, or
              proceeding and may order a new trial or grant such other
              relief as may be just for the following reasons []:

              (a) Mistake, inadvertence, surprise, or excusable neglect[.]

Minn. R. Civ. P. 60.02.

       Nothing in the plain language of either rule precludes a party from seeking relief

under rule 60.02 from a judgment entered pursuant to rule 5.04(a). Moreover, rule 60.02

excludes one type of judgment: a marriage dissolution decree. The supreme court did

not exclude judgments entered pursuant to rule 5.04(a) from the judgments from which

rule 60.02 may provide relief. Accordingly, we conclude that rule 60.02 applies to a

judgement entered under rule 5.04(a). Cf. 2A David F. Herr & Roger S. Haydock,

Minnesota Practice, § 60.02 (5th ed.) (“Although motions to vacate judgments and orders




                                              6
under Rule 60.02 arise most frequently in the context of default judgments, the rule

applies to any order or judgment.”).4

                                             II.

       Appellant also challenges the district court’s alternative denial of relief under

Minn. R. Civ. P. 60.02, “even if [the rule] did apply.”         “Minnesota courts analyze

motions seeking relief from orders and judgments under Minn. R. Civ. P. 60.02 by

applying a four-factor test that was established in Hinz . . . .” Northland Temporaries,

Inc. v. Turpin, 744 N.W.2d 398, 402 (Minn. App. 2008) review denied (Minn. Apr. 29,

2008); see also Finden v. Klaas, 268 Minn. 268, 271, 128 N.W.2d 748, 750 (1964)

(reaffirming the Hinz test). The test requires consideration of whether the movant has

(1) a reasonable claim or defense on the merits; (2) a reasonable excuse for the neglect;

(3) acted diligently after notice of entry of judgment; and (4) demonstrated that no

prejudice will occur to the opposing party. Northland Temporaries, 744 N.W.2d at 402

(citing Hinz, 237 Minn. at 30, 53 N.W.2d at 456).




4
  Although not necessary to a plain-language analysis, we also note that our conclusion
that rule 60.02 is available in this circumstance finds support in the report of the task
force that recommended the amendments to rule 5.04. In reporting the rules
subcommittee’s recommendation for dismissal with prejudice as a consequence for
failure to file a case within one year, the task force noted in a footnote that “Minn. R. Civ.
P. 60 allows parties to seek relief from a dismissal order.” Recommendations of the
Minnesota Supreme Court Civil Justice Reform Task Force, No. ADM10-8051 at 23 n. 9.
(Final Report Dec. 27, 2011). See generally Joe Muchlinski, Note, Constraining
Minnesota’s Hip-Pocket Regime: Too Much or Not Enough? (or Both?) (or Neither?),
41 Wm. Mitchell L. Rev. 1556 (2015).


                                              7
       Importantly, a party seeking relief from a judgment need not categorically

establish all four of the rule-60.02 factors.5 See Northland Temporaries, 744 N.W.2d at

406 (noting that there is some inconsistent language in the caselaw but that there is “no

solid authority for saying that the district court may only grant relief under rule 60.02

when all four factors have been fully met”). Rather, “case law . . . favors a balancing of

all the factors.” Riemer v. Zahn, 420 N.W.2d 659, 662 (Minn. App. 1988). “[T]he

relative weakness of one factor should be balanced against the strong showing on the

other three factors.” Guillaume & Assocs., Inc. v. Don-John Co., 371 N.W.2d 15, 19

(Minn. App. 1985). In particular, it may be appropriate to grant relief from a judgment

when a party’s weak excuse for neglect is “outweighed by a strong showing on the three

remaining factors.” Riemer, 420 N.W.2d at 662.

       “The decision to vacate judgment under rule 60.02 rests within the district court’s

discretion and will not be reversed absent an abuse of that discretion.” Meyer v. Best W.

Seville Plaza Hotel, 562 N.W.2d 690, 694 (Minn. App. 1997) review denied (Minn.

June 26, 1997). The district court’s discretion in applying the rule, however, is not

unlimited. Northland Temporaries, 744 N.W.2d at 402. In Northland Temporaries, we

identified several limits on the district court’s discretion. Id. at 406. First, a district court

must grant a motion to reopen a judgment if a party establishes all four of the rule-60.02

factors. Id. at 402 (citing Hinz, 237 Minn. at 30, 53 N.W.2d at 455-56); see also Finden,


5
  Minnesota caselaw has referred to these factors as both Hinz factors and Finden factors,
with relatively equal frequency. To avoid confusion resulting from the dual case-name
references, we refer to them as the rule-60.02 factors.

                                               8
268 Minn. 271-73, 128 N.W.2d at 750-51 (reaffirming the Hinz standard). Second, a

district court may not grant a motion to reopen a judgment if the movant fails to

demonstrate a reasonable claim or defense on the merits. Northland Temporaries, 744

N.W.2d at 402 (citing Vrooman Floor Covering Inc. v. Dorsey, 267 Minn. 318, 322, 126

N.W.2d 377, 380 (1964) and Hengel v. Hyatt, 312 Minn. 317, 319, 252 N.W.2d 105, 106

(1977)). Finally, we will reverse if the district court acts under a misapprehension of law

or fact. Northland Temporaries, 744 N.W.2d at 402.

       In this case, the district court held that appellant is not entitled to relief under rule

60.02 because he “did not prove all four elements . . . pursuant to Minn. R. Civ. P.

60.02.” (Emphasis added.) This holding reflects a misapprehension of the rule. As

explained, the rule-60.02 factors are factors to be considered, and not elements to be

proved. The district court is required to consider and weigh those factors to determine

whether relief from judgment is appropriate under the circumstances. Accordingly, we

conclude that the district court abused its discretion by failing to properly consider and

weigh the rule-60.02 factors.

       Appellant asserts that all four rule-60.02 factors are satisfied and that we should

therefore reverse and remand for the case to proceed on the merits. As noted, it is true

that a district court has no discretion to deny a motion for relief from a judgment when all

four rule-60.02 factors are established and favor reopening. See Northland Temporaries,

744 N.W.2d at 402 (citing Hinz, 237 Minn. at 30, 53 N.W.2d at 455-56); see also Finden,

268 Minn. 271-73, 128 N.W.2d at 750-51 (reaffirming the Hinz standard). But we



                                               9
generally do not address issues on appeal that were not first addressed by the district

court. See Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988). This is particularly true

where, as here, there may be factual disputes. Id.; see also Whitaker v. 3M Co., 764

N.W.2d 631, 640 (Minn. App. 2009) (stating that district court, and not this court, “must

address and resolve [relevant] factual disputes”).       Resolution of factual disputes is

uniquely a district court function. See Kucera v. Kucera, 275 Minn. 252, 254, 146

N.W.2d 181, 183 (1966) (“It is not within the province of [appellate courts] to determine

issues of fact on appeal.”). And remand is the appropriate remedy when the district court

has made insufficient findings to enable appellate review. See, e.g., Stich v. Stich, 435

N.W.2d 52, 53 (Minn. 1989) (reversing and remanding where district court made

insufficient findings to demonstrate proper consideration of statutory requirements for

spousal maintenance). Moreover, even if not strictly required by the rules, it is the

“preferred practice” for the district court to make findings to support the exercise of

discretion. See, e.g., Contractors Edge, Inc. v. City of Mankato, 863 N.W.2d 765, 769

(Minn. 2015) (stating that it is “a practice for the district court to provide a written

explanation” for a certification decision, but failure to do so, by itself, was not an abuse

of discretion).

       In this case, respondent vigorously contests all four rule-60.02 factors, and it is not

clear which, if any, of the factors the district court determined favor reopening. Neither

can we determine how or if the district court weighed the rule-60.02 factors.

Accordingly, we conclude that it is appropriate to reverse and remand for the district



                                             10
court to properly apply the rule-60.02 factors. See Northland Temporaries, 744 N.W.2d

at 407 (reversing and remanding for reevaluation of rule-60.02 factors); see also Robb v.

Norfolk & W. Ry., 122 F.3d 354, 362-63 (7th Cir. 1997) (remanding for reconsideration

of motion to vacate under federal rules where district court erroneously concluded that it

did not have authority to grant relief); Sleek v. J.C. Penney Co., 292 F.2d 256, 258 (3d

Cir. 1961) (same).

                                    DECISION

      The district court erred by concluding that a party may not seek relief under Minn.

R. Civ. P. 60.02 from a judgment entered pursuant to Minn. R. Civ. P. 5.04(a), and by

holding that a party must “prove all four elements” under rule 60.02 in order to obtain

relief from the judgment. We reverse and remand for the district court to evaluate

whether relief from the judgment is appropriate under the circumstances of this case.

      Reversed and remanded.




                                           11
CONNOLLY, Judge (concurring specially)

       I concur specially to emphasize that our decision is not in any way intended to

modify or neutralize the requirement of Minn. R. Civ. P. 5.04 that an action be filed with

the court within one year of its commencement by service. By extending the relief under

Minn. R. 60.02 available to any other final judgment (except marriage-dissolution

judgments) to dismissals for failure to timely file under Minn. R. Civ. P. 5.04, we do not

imply that a dismissal under Minn. R. Civ. P. 5.04 is any less final than a dismissal under

Minn. R. Civ. P. 12.02(e) (for failure to state a claim upon which relief can be granted) or

under Minn. R. Civ. P. 41.02 (a) (for failure to prosecute or comply with the rules of civil

procedure) and (b) (for failure to show a right to relief), or a judgment on the merits. At

least one of the grounds entitling a party to relief under Minn. R. Civ. P. 60.02 must

apply, and the motion for relief “shall be made within a reasonable time.”

       As our opinion indicates, the same weighing of the rule-60.02 factors required to

obtain relief under that rule in other situations applies here, and the “preferred practice” is

for the district court to make findings that reflect its consideration and weighing of those

factors. Cf. Contractors Edge, Inc. v. City of Mankato, 863 N.W.2d 765, 769 (Minn.

2015). As the availability of relief under rule 60 does not neutralize the finality of other

judgments, it does not neutralize the finality of rule-5.04 dismissals.




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