                    IN THE COURT OF APPEALS OF IOWA

                                    No. 15-1193
                             Filed November 23, 2016


IN RE THE MARRIAGE OF DELILA HEALEY
AND CODY OʼHARE

Upon the Petition of
DELILA HEALEY,
      Petitioner-Appellee,

And Concerning
CODY OʼHARE,
     Respondent-Appellant.
________________________________________________________________


       Appeal from the Iowa District Court for Dubuque County, Thomas A.

Bitter, Judge.



       A father appeals the district court’s grant of the mother’s application for

default on her counterclaim for sole legal custody and the subsequent dismissal

of his petition to modify the physical care of the children. AFFIRMED.



       Sheree L. Smith, Cedar Rapids, for appellant.

       Bradley T. Boffeli of Boffeli & Spannagel, P.C., Dubuque, for appellee.



       Considered by Vogel, P.J., and Vaitheswaran and McDonald, JJ.
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VOGEL, Presiding Judge.

       Cody O’Hare appeals the district court’s decision granting Delila Healey a

default judgment on her counterclaim for sole legal custody and dismissing

Cody’s petition to modify the physical care of the children. Cody and Delila’s

marriage was dissolved by stipulated decree in 2004.           The parties are the

parents of three children: twins born in 1999 and another child born in 2002. The

stipulated decree gave the parties joint legal custody and placed all three

children in Delila’s physical care, subject to Cody’s visitation. A prior modification

decision was entered in 2012, which generally denied a petition to modify the

physical care of the children but granted a modification of the visitation schedule.

Specifically, the court found at that time,

              The Court heard no evidence that the parties ever had a
       healthy relationship.   Following a tumultuous marriage, they
       divorced by way of a stipulated decree. The extent and quality of
       communication between the parties was then and is now extremely
       poor. Accordingly, this is not a change in the circumstances that
       existed at the time of the decree, let alone a material and
       substantial change.

Thereafter, in July 2013, Cody filed another application to modify the physical

care of one of the twins. That month, Delila filed an answer and counterclaim,

asserting she should be granted sole legal custody and physical care of all three

children. In August 2013, Cody filed an application for emergency temporary

orders and an expedited hearing, noting the child at issue in his modification

application had been in his care throughout the summer of 2013. The court

denied the motion after conducting a hearing.         A trial scheduling order was

entered September 30, 2013, setting trial for January 21, 2014.
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       On January 9, 2014, a few days before the scheduled trial, Delila filed an

application for entry of default judgment against Cody noting that while Cody had

faxed his answer to Delila’s counterclaim to Delila’s counsel on October 11,

2013, this answer was never filed with the district court. The application noted a

notice of intent to file written application for default was mailed to Cody’s attorney

on September 30, 2013. The trial set for January 21, 2014, was continued by

consent of the parties and on February 5, the court granted Delila’s application

for default after “having reviewed the file.” It does not appear that a hearing was

conducted or that Cody filed a resistance to the application for default.

       A new scheduling order was entered March 13, 2014, setting trial for

April 28 on Delila’s counterclaim. On April 7, on the sixtieth day after the filing of

the order granting the application for default, Cody filed a motion to set aside the

default, asserting an answer was sent to opposing counsel and the clerk of court

but no answer was ever filed in the court record. On the same day, Delila filed a

motion to dismiss Cody’s modification petition noting the default judgment was

granted in favor of her counterclaim and that made Cody’s modification petition

moot. The trial was once again continued and rescheduled to July 28, and a

hearing was held on the motion to set aside the default on May 9, 2014.1



1
   While the hearing was reported, we have no transcript of the hearing to review on
appeal as Cody did not order this transcript to be prepared for the purposes of this
appeal. Therefore, our record contains only the district court’s order denying Cody’s
motion to set aside the default. Also, following the hearing, but before the court issued
its decision, Cody’s counsel filed a motion to reopen the record in which she states,
among other things, she never received the notice of default Delila’s counsel sent in
September 2013 because it was sent to a wrong address. Counsel also claimed in the
motion to reopen that she was not prepared at the hearing because she believed the
parties would settle the case and not proceed with the hearing. There is no indication
the court ruled on this motion to reopen the record. We will thus not consider this
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       The court denied the motion to set aside the default on May 16, 2014,

finding that it did not believe Cody’s counsel’s assertion that she sent Cody’s

answer to Delila’s counterclaim to the district court for filing.              The court

determined the motion to set aside the default was not promptly filed because,

while it had been filed on the sixtieth day following the entry of the default, Cody’s

counsel had no reason to wait that long except for her explanation that she was

“too busy.” The court concluded:

               [Cody] had more than ample notice as to the default, as well
       as more than ample time to cure the default. No reason was given
       as to why an answer was not filed after [Cody’s counsel] was
       notified in writing that her answer was not on file with the Clerk of
       Court. The motion to set aside default was not filed promptly. No
       evidence was offered in support of the motion. At the hearing for
       [Cody’s counsel’s] motion to set aside the default, [Cody’s counsel]
       came without a client, without her file, and without any evidence.
       The Court cannot find that there was any mistake, inadvertence,
       surprise, excusable neglect, or unavoidable casualty. As such,
       [Cody’s] motion to set aside default is DENIED.

The court went on to grant Delila’s motion to dismiss Cody’s modification petition

as moot “because a default has been entered with respect to [Delila’s]

counterclaim.”

       Cody filed a new application to modify the physical care of the children on

May 29.     Cody’s counsel also filed a motion pursuant to Iowa Rule of Civil

Procedure 1.904(2) on June 2, 2014, asserting the court should reconsider its

denial of Cody’s motion to set aside the default, explaining counsel did not take

action on the application for entry of default judgment based on the belief that

Delila’s counsel would withdraw the application in light of counsel’s concession to



information part of the factual record before the district court at the motion to set aside
the default.
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have the trial date continued. The court denied the rule 1.904(2) motion on July

10, 2014.

       Delila resisted the filing of Cody’s new modification action and asked that

the application be dismissed and Cody’s attorney sanctioned. After a hearing on

October 10, 2014, the court dismissed Cody’s new modification action finding it

to be “premature” in light of the fact no judgment had yet been entered following

the entry of the default on Delila’s counterclaim and the dismissal of Cody’s initial

modification action.   The court ordered, “Cody shall not initiate any further

modification proceedings until the proceedings related to the default are

concluded.”

       A new trial date was set for March 23, 2015, for Delila’s counterclaim. In

advance of that trial date, Cody’s counsel filed a witness list, exhibit list, and a

document entitled “requested relief” that generally asserted his opposition to

Delila’s counterclaim. The trial date on the counterclaim was again reset to start

on June 12 due to the unavailability of a judge on March 23. Counsel for Delila

also filed a motion seeking clarification on what, if any, evidence Cody would be

allowed to present at trial in light of his default. The court issued an order noting

Cody was in default on the counterclaim and that default had not been set aside,

and therefore, “he cannot present evidence at the hearing.” Counsel for Delila

moved to withdraw as counsel, which the district court granted, and the matter

proceeded to trial on June 12 with Delila representing herself and Cody and his

counsel appearing but presenting no evidence.

       On the day of trial, two hours before the hearing, Cody’s counsel filed a

motion to dismiss Delila’s counterclaim, asserting the prior order that precluded
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his presentation of evidence was procured by ex parte communication with the

court and the counterclaim was not proper in light of the fact the only

counterclaim allowed in actions under Iowa Code chapter 598 (2013) are

counterclaims for spousal support. See Iowa Code § 598.3. Cody asked that the

counterclaim be dismissed and his modification petition be reinstated.

       At trial on June 12, Delila testified, explaining why she wanted sole legal

custody of all three children at issue. Cody’s counsel was permitted to cross-

examine Delila and made arguments consistent with the motion to dismiss filed

before the hearing. The court ruled at the hearing:

               I know based on my dealing with this file that communication
       [is] not good, cooperation is not good. The whole situation between
       the two of you and your kids is not good. And based on the issue in
       front of me today with the default, I think it’s appropriate to award
       sole legal custody. Again, that’s not going to affect physical care.
       It’s not going to affect visitation. But I am going to enter an order
       that provides that [Delila] will have sole legal custody for these
       children.

The court denied Cody’s motion to dismiss at the hearing, stating that it

concluded Cody was incorrect in his assertion the counterclaim was improper

and the motion to dismiss was untimely filed. The court then filed an order

stating:

               [Delila’s] pleading requesting sole legal custody was filed
       herein in July 2013. Since that time, things have only gotten worse.
       For the reasons provided to the parties on the record, [Delila’s]
       request for sole legal custody is granted. [Cody] is permitted
       access to information regarding school, medical care, legal issues,
       religious matters, etc., but [Delila] is given the ultimate decision-
       making authority for such things.
               [Cody’s] Motion to Dismiss, filed June 12, 2015, is denied.

       Cody filed a notice of appeal and asserts the district court erred in entering

a default judgment against him. His first claim contends the notice of the intent to
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file a default judgment Delila’s counsel sent to his attorney in September 2013

was improper because it was addressed to his attorney and should have instead

been addressed and sent directly to him.2 Delila claims this assertion was not

preserved for appeal, and we agree.

       Upon our review of the record, we do not find Cody making a claim at the

district court that the notice sent in September 2013 was improper under the

applicable rules of civil procedure because it was not addressed directly to him.

This claim is not contained in Cody’s motion to set aside the default, which was

filed April 7, 2014. We do not have a transcript of the hearing on the motion to

set aside the default to determine if such claim was made during the hearing, 3

but nothing in the district court’s order denying the motion to set aside the default

indicates such a claim was made.          “It is a fundamental doctrine of appellate

review that issues must ordinarily be both raised and decided by the district court

before we will decide them on appeal.” Meier v. Senecaut, 641 N.W.2d 532, 537

(Iowa 2002). “If the court’s ruling indicates that the court considered the issue

and necessarily ruled on it, even if the court’s reasoning is ‘incomplete or sparse,’

the issue has been preserved.” Lamasters v. State, 821 N.W.2d 856, 864 (Iowa

2012) (citation omitted). Based on the record before us, we cannot conclude the

issue of the adequacy of the notice was ever presented to the district court nor



2
  But see Iowa R. Civ. P. 1.972(3)(b) (“When a party claimed to be in default is known by
the party requesting the entry of default to be represented by an attorney, whether or not
that attorney has formally appeared, a copy of notice of intent to file written application
for default shall be sent by ordinary mail to the attorney for the party claimed to be in
default.”).
3
   It was Cody’s obligation to order the transcripts of the relevant district court
proceedings, and the only transcript ordered for this appeal was the June 12, 2015
hearing on Delila’s counterclaim.
                                            8


was it ever explicitly or impliedly ruled on. Therefore, we conclude this issue is

not preserved for our review.

       Next, Cody claims Delila’s counterclaim was improper and did not require

an answer to be filed.          He asserts Iowa Code section 598.3 prohibits

counterclaims to be filed in actions under chapter 598.4 Because he asserts

Delila’s counterclaim was improper, he contends he cannot be found in default

for failing to file an answer to that counterclaim.

       Cody first made this claim in his motion to dismiss Delila’s counterclaim,

which was filed two hours before the hearing on June 12, 2015, which was set for

Delila to prove up her claim for sole custody.

       “The doctrine of error preservation has two components—a
       substantive component and a timeliness component.” To preserve
       error on appeal, the party must first state the objection in a timely
       manner, that is, at a time when corrective action can be taken, in
       addition to the basis for the objection.

State v. Jentz, 853 N.W.2d 257, 262 (Iowa Ct. App. 2013) (citation omitted).

       This claim was asserted after the default judgment had been entered

against Cody, after the court had denied Cody’s motion to set aside the default,

and after his modification application had been dismissed as moot. Cody should

have raised this claim earlier when the issue of his failure to file an answer to the

counterclaim was being evaluated by the district court. Cody filed no resistance

to Delila’s application for default, and his motion to set aside the default did not

question the appropriateness or validity of Delila’s counterclaim. By the time the

4
  We note section 598.3 provides, in part, that actions for dissolution of marriage “shall
not be subject to counterclaim or cross petition by the respondent.” This is not an action
for the dissolution of a marriage but for the modification of a custodial decree. We
therefore find Delila’s counterclaim was not invalid in light of section 598.3 as Cody
asserts on appeal.
                                         9


issue was raised to the district court, the court could no longer grant the relief

sought as it had already denied the motion to set aside the default and the

hearing was limited to the evidence Delila could offer in support of her claim for

sole legal custody. We therefore find the issue is not preserved for our review

because it was not timely raised.

         Finally, Cody claims the court abused its discretion in not granting his

motion to set aside the default. Under Iowa Rule of Civil Procedure 1.977, if

good cause is shown, a court may grant a motion to set aside a default judgment

“for mistake, inadvertence, surprise, excusable neglect, or unavoidable casualty.”

“In ruling on a motion to set aside a default judgment, the district court is vested

with broad discretion and will only be reversed if that discretion is abused.”

Sheeder v. Boyette, 764 N.W.2d 778, 780 (Iowa Ct. App. 2009). We are bound

by the district court’s factual findings if the findings are supported by substantial

evidence, but the question of whether good cause has been established is a

legal conclusion that is not binding on us. Id. “We are more reluctant to interfere

with a court’s grant of a motion to set aside a default and a default judgment than

with its denial.” Brandenburg v. Feterl Mfg. Co., 603 N.W.2d 580, 584 (Iowa

1999).

         It is the movant’s burden to plead and prove good cause to set aside a

default. Sheeder, 764 N.W.2d at 780. “Good cause is a ‘sound, effective, and

truthful reason.     It is something more than an excuse, a plea, apology,

extenuation, or some justification, for the resulting effect.’” Id. (quoting Cent.

Nat’l Ins. Co. of Omaha v. Ins. Co. of N. Am., 513 N.W.2d 750, 754 (Iowa 1994)).

While it is our preference that controversies be decided “on their merits rather
                                         10


than on the basis of nonprejudicial inadvertence or mistake,” the exception to set

aside a default will not be extended “when the movant has ignored the rules of

procedure with ample opportunity to abide by them.” Id. (citation omitted).

       Cody asserts his failure to file an answer was the result of excusable

neglect or mistake. He claims the answer to the counterclaim was served on

opposing counsel and mailed to the clerk of court but because of some “mailing

error of unknown origin” the answer was never filed in the court file. In its order

denying the motion to set aside, the district court found, after evaluating the

arguments of counsel: “The Court does not believe that [Cody’s attorney] ever

sent the original document to the Clerk of Court for filing.” We give deference to

the district court’s credibility findings because it was able to listen to and observe

the demeanor of those in the courtroom. See In re Marriage of Gensley, 777

N.W.2d 705, 713 (Iowa Ct. App. 2009).

       Even if we were to disregard this credibility finding, we still cannot

conclude the district court abused its discretion. Cody’s counsel was alerted to

the lack of an answer to the counterclaim in September 2013, yet took no action

to ensure an answer was on file. The deficiency was again illuminated when

Delila’s counsel filed the application for entry of a default judgment in January

2014. Again Cody’s counsel took no action in the ensuing four weeks to file an

answer or resist the entry of the default. The court entered default on February 5

after a review of the file demonstrated there was no answer on file or any

resistance to the application for default. Counsel then waited until the sixtieth

day after the entry of the default to file a motion to set aside the default,

explaining the delay by only saying she was “too busy.” Finally, at the hearing on
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the motion, counsel offered no evidence to support Cody’s motion to set aside

the default. Thus, we cannot conclude the district court abused its discretion in

deciding Cody had ample notice of the lack of an answer in the court file and

ample time to cure the default and in determining Cody offered no evidence to

support a conclusion that the default was the result of a “mistake, inadvertence,

surprise, excusable neglect, or unavoidable casualty.”        See Iowa R. Civ. P.

1.977; In re Marriage of Huston, 263 N.W.2d 697, 689–99 (Iowa 1978) (affirming

the district court’s refusal to set aside the default judgment entered where the

facts indicate “mere inexcusable neglect”).

       We affirm the district court’s denial of Cody’s motion to set aside the

default and the court’s order granting Delila’s request for sole legal custody.

       Both parties request an award of appellate attorney fees. Such an award

rests in our discretion and we consider, “‘the needs of the party seeking the

award, the ability of the other party to pay, and the relative merits of the appeal.’

We also consider whether a party was obligated to defend the district court’s

decision.” Christy v. Lenz, 878 N.W.2d 461, 469 (Iowa Ct. App. 2016) (citations

omitted). Upon consideration of these factors, we decline to award either party

appellate attorney fees.

       AFFIRMED.
