Motion to Set Aside / Vacate Default Judgment (Debt) - Alabama

IN THE [____________] COURT OF [____________] COUNTY, ALABAMA

Civil Action No. [____________]

DEFENDANT'S MOTION TO SET ASIDE / VACATE DEFAULT JUDGMENT

Filed Pursuant to Ala. R. Civ. P. 55(c) and 60(b)

COMES NOW the Defendant, [____________] ("Defendant"), appearing [☐ pro se / ☐ by and through undersigned counsel], and respectfully moves this Court to set aside and vacate the default judgment entered against Defendant in this action on [__/__/____], pursuant to Ala. R. Civ. P. 55(c) and 60(b). In support, Defendant states as follows:

I. INTRODUCTION AND BASIS FOR RELIEF

1. This is a debt-collection action in which Plaintiff [☐ is a debt buyer / ☐ is a collection agency / ☐ claims to be the original creditor] seeking to collect an alleged consumer debt. A default judgment was entered against Defendant on [__/__/____] in the amount of $[____________], plus [interest, costs, and/or fees].

2. Defendant did not receive proper notice of this action and/or had good cause for not responding, has one or more meritorious defenses to the alleged debt, and brings this motion promptly upon learning of the judgment. For the reasons set forth below, the default judgment is due to be set aside.

3. Alabama policy strongly favors resolution of disputes on the merits. The trial court's discretion under Rule 55(c) must be exercised against "the presumption that cases should be decided on the merits whenever it is practicable to do so." Kirtland v. Fort Morgan Auth. Sewer Serv., Inc., 524 So. 2d 600, 604 (Ala. 1988).

II. IDENTIFICATION OF THE DEFAULT JUDGMENT

4. Date of judgment. The default judgment was entered on [__/__/____].

5. Amount. The judgment is in the amount of $[____________], consisting of [principal $[____], interest $[____], attorney's fees $[____], court costs $[____]].

6. How Defendant learned of the judgment. Defendant first learned of the default judgment on [__/__/____] by the following means:

☐ A notice of garnishment of wages served on Defendant's employer
☐ A bank levy / freeze or garnishment of Defendant's bank account
☐ A post-judgment writ, interrogatories, or examination notice
☐ A credit report entry
☐ Other: [____________]

7. Defendant files this motion [____] days after first learning of the judgment, which is within a reasonable time and within the applicable deadline under [☐ Rule 55(c) (within 30 days of entry) / ☐ Rule 60(b)].

III. LEGAL STANDARD

8. Rule 55(c) — broad discretion, exercised under the three-factor test. A trial court has broad discretion to set aside a default judgment, but that discretion "should not be exercised without considering the following three factors: 1) whether the defendant has a meritorious defense; 2) whether the plaintiff will be unfairly prejudiced if the default judgment is set aside; and 3) whether the default judgment was a result of the defendant's own culpable conduct." Kirtland, 524 So. 2d at 605.

9. Meritorious defense. To show a meritorious defense, Defendant need not prove that Defendant would prevail at trial, "only that the movant show the court that the movant is prepared to present a plausible defense." Sampson v. Cansler, 726 So. 2d 632, 634 (Ala. 1998). A plausible defense is one that, "if proven at trial, would constitute a complete defense to the action," supported by "relevant legal grounds substantiated by a credible factual basis." Kirtland, 524 So. 2d at 606.

10. Rule 60(b) — relief from a final judgment. Where the 30-day Rule 55(c) window has closed, the Court may grant relief under Ala. R. Civ. P. 60(b) for, among other reasons, (1) mistake, inadvertence, surprise, or excusable neglect; (3) fraud, misrepresentation, or misconduct of an adverse party; (4) the judgment is void; or (6) any other reason justifying relief.

11. A judgment without valid service is void. A court acquires personal jurisdiction only through valid service of process. A default judgment entered when the defendant was not properly served is void for lack of personal jurisdiction and is due to be set aside under Rule 60(b)(4); for a void judgment the Court has no discretion to do otherwise. Ala. R. Civ. P. 4, 12(b)(2), (4), (5).

IV. GROUNDS FOR SETTING ASIDE THE JUDGMENT

☐ A. The judgment is VOID — defective or no service of process; lack of personal jurisdiction. Defendant was never validly served with the summons and complaint as required by Ala. R. Civ. P. 4. Specifically: [describe — e.g., "Defendant did not live at the address where service was attempted," "the return reflects service on a person not authorized to accept it," "no certified-mail return receipt was signed by Defendant," "Defendant first learned of the suit only through the garnishment"]. Because the Court lacked personal jurisdiction, the judgment is void and must be vacated. Ala. R. Civ. P. 60(b)(4).

☐ B. Excusable neglect, mistake, surprise, or inadvertence. Defendant's failure to respond was the result of excusable neglect and not culpable conduct, in that: [describe — e.g., "Defendant was hospitalized," "the papers were misdelivered or received late," "Defendant reasonably believed the matter had been resolved/disputed with the collector," "Defendant did not understand the deadline"]. Ala. R. Civ. P. 55(c); 60(b)(1).

☐ C. Fraud, misrepresentation, or misconduct. The judgment was obtained through fraud, misrepresentation, or misconduct by Plaintiff or its agents, including [describe — e.g., "a false affidavit or 'sewer service' return of service," "misrepresentation of the amount owed," "concealment of the lack of any assignment"]. Ala. R. Civ. P. 60(b)(3).

☐ D. Newly discovered evidence. Defendant has discovered evidence that could not, with reasonable diligence, have been discovered earlier, namely: [describe]. Ala. R. Civ. P. 60(b)(2).

☐ E. Defendant has a meritorious defense (see Section V).

V. DEFENDANT HAS A MERITORIOUS DEFENSE

12. Defendant is prepared to present one or more plausible, fact-supported defenses that, if proven, would constitute a complete defense to Plaintiff's claim. Defendant asserts the following meritorious defense(s):

☐ Statute of limitations. The alleged debt is time-barred. An action on an open or unliquidated account must be brought within three (3) years (Ala. Code § 6-2-37(1)); a stated/liquidated account or written contract is generally governed by a six (6) year period (Ala. Code § 6-2-34). The last payment/activity on the account occurred on or about [__/__/____], more than the limitations period before suit was filed. [Verify characterization; some authorities cite 10 years for written contracts under § 6-2-33(1).]

☐ Not the debtor / mistaken identity / identity theft. Defendant is not the person who incurred the alleged debt and/or the account was opened or used as a result of identity theft. [Describe; attach FTC Identity Theft Report / police report as Exhibit [__].]

☐ Wrong amount. The amount of the judgment is incorrect, inflated, or includes unauthorized interest, fees, or charges. The correct balance, if any, is $[____________].

☐ Debt paid, settled, or discharged. The alleged debt was paid, settled, or discharged (including by discharge in bankruptcy on [__/__/____], Case No. [____________]) and is not owed.

☐ Plaintiff lacks standing / no chain of assignment. Plaintiff is not the original creditor and has not proven a complete, unbroken chain of assignment showing it owns Defendant's specific account. Plaintiff is not the real party in interest.

☐ No § 1692g validation; FDCPA violations. Plaintiff and/or its predecessor failed to provide the validation notice and verification required by 15 U.S.C. § 1692g and/or sued on a time-barred or unverified debt in violation of the FDCPA.

☐ Other meritorious defense: [____________]

13. These defenses are substantiated by the facts set forth in Defendant's Affidavit, below, and the attached exhibits, and are sufficient to warrant submission of the case to a fact-finder.

VI. NO UNFAIR PREJUDICE TO PLAINTIFF; CONDUCT NOT CULPABLE

14. No unfair prejudice. Setting aside the judgment will not unfairly prejudice Plaintiff. The relevant inquiry concerns prejudice from reopening the case, not the mere loss of the default. Plaintiff retains its evidence and its claim; only the opportunity for a one-sided judgment is lost. Defendant is prepared to proceed promptly.

15. Conduct not culpable. Defendant's failure to appear was not willful, intentional, or in bad faith. As set forth above and in the attached Affidavit, it resulted from [lack of valid service / excusable neglect], not from any deliberate disregard of the Court's process.

VII. DEFENDANT'S AFFIDAVIT

STATE OF ALABAMA )
COUNTY OF [____________] )

I, [____________], being first duly sworn, depose and state as follows:

1. I am the Defendant in this action. I am over the age of nineteen (19) and competent to testify, and I make this affidavit on personal knowledge.

2. I was never properly served with the summons and complaint in this case. [State the facts: where you lived on the date of attempted service; whether you received the papers; who, if anyone, was served; how you actually learned of the lawsuit.]

3. I first learned that a judgment had been entered against me on [__/__/____], when [describe — e.g., "my wages were garnished" / "my bank account was frozen"].

4. I have a meritorious defense to Plaintiff's claim, namely: [state the facts supporting the defense(s) checked above — e.g., the date of last payment, that the account is not mine, that the amount is wrong, that the debt was discharged in bankruptcy].

5. My failure to respond to the complaint was not intentional or the result of any disregard of this Court. [State the facts establishing excusable neglect or lack of service.]

6. I respectfully ask the Court to set aside the default judgment, allow me to defend this case on the merits, and stay any collection efforts in the meantime.

_______________________________________
[____________], Defendant

Sworn to and subscribed before me this [____] day of [____________], 20[____].

_______________________________________
Notary Public
My commission expires: [__/__/____]

VIII. REQUEST TO STAY EXECUTION AND GARNISHMENT

16. Defendant requests that the Court stay execution on the judgment — including any wage garnishment, bank garnishment, levy, or other post-judgment process — pending the Court's ruling on this motion. Ala. R. Civ. P. 62. Absent a stay, Defendant faces immediate and irreparable harm from the garnishment of wages or funds that may be exempt and that Defendant needs for basic living expenses, even though the underlying judgment is subject to being vacated.

17. Defendant further requests that any funds already garnished or levied be held by the garnishee or the Court, and not disbursed to Plaintiff, until this motion is decided.

IX. RELIEF REQUESTED

WHEREFORE, Defendant respectfully requests that this Court:

A. SET ASIDE and VACATE the default judgment entered on [__/__/____];

B. STAY all execution, garnishment, levy, and other post-judgment collection proceedings pending the Court's ruling, and order that any funds already garnished or levied be held and not disbursed;

C. QUASH any outstanding writ of garnishment or execution issued on the judgment;

D. GRANT Defendant leave to file an Answer and defend this action on the merits, with the accompanying [proposed] Answer deemed filed as of the date of the order;

E. Set this matter for a hearing if the Court deems one necessary; and

F. Grant such other and further relief as the Court deems just and proper.

X. PROPOSED ORDER

A proposed Order Setting Aside Default Judgment is submitted contemporaneously with this motion for the Court's consideration.

[PROPOSED] ORDER

This matter came before the Court on Defendant's Motion to Set Aside / Vacate Default Judgment. Having considered the motion, the supporting affidavit, any response, and the applicable law — including the factors set out in Kirtland v. Fort Morgan Authority Sewer Service, Inc., 524 So. 2d 600 (Ala. 1988) — the Court finds that the motion is due to be GRANTED.

It is therefore ORDERED that the default judgment entered on [__/__/____] is SET ASIDE and VACATED; all garnishments, levies, and executions on that judgment are QUASHED and STAYED, and any garnished or levied funds shall be returned to Defendant; and Defendant is granted leave to file an Answer within [____] days of this Order.

DONE and ORDERED this the ____ day of __________, 20____.

_________________________________
Judge

XI. SIGNATURE

Respectfully submitted this [____] day of [____________], 20[____].

/s/ [____________________________________]
[____________________________________]
☐ Defendant, pro se ☐ Attorney for Defendant
Alabama State Bar No. (if attorney): [____________]
[Street Address]
[City], Alabama [____]
Telephone: ([____]) [____]-[________]
Email: [____________________________________]

XII. CERTIFICATE OF SERVICE

I hereby certify that on the [____] day of [____________], 20[____], I served a true and correct copy of the foregoing Defendant's Motion to Set Aside / Vacate Default Judgment, the supporting Affidavit, and the proposed Order upon Plaintiff's counsel of record (or upon Plaintiff, if unrepresented) in accordance with Ala. R. Civ. P. 5, by the following method:

☐ Alabama AlaFile electronic-filing system (notice to all counsel of record)
☐ U.S. First-Class Mail, postage prepaid
☐ Certified Mail, Return Receipt Requested
☐ Hand Delivery
☐ Email (by agreement / where permitted)

Addressed to:

[____________________________________]
[____________________________________]
[____________________________________]

/s/ [____________________________________]
[____________________________________]

ALABAMA PRACTICE NOTES

• Deadline: A Rule 55(c) motion to set aside a default judgment must be filed within 30 days of entry of the judgment. After 30 days, use Rule 60(b): a motion under Rule 60(b)(1)–(3) must be filed within a reasonable time and not more than 4 months after entry; Rule 60(b)(4) (void judgment) and 60(b)(6) require only a "reasonable time." Verify the entry date and calendar immediately.
• The Kirtland three-factor test is mandatory. To trigger the court's duty to weigh the factors, the movant must allege and provide arguments and evidence on ALL THREE: (1) meritorious defense; (2) no unfair prejudice to plaintiff; and (3) movant's conduct not culpable. Kirtland, 524 So. 2d 600; Sampson v. Cansler, 726 So. 2d 632.
• Void for defective service: A judgment entered without valid service is void for lack of personal jurisdiction (Rule 60(b)(4)); the court has no discretion and must set it aside. Common in debt cases where the consumer first learns of the suit through a garnishment ("sewer service").
• Stay collection: Request a stay of execution/garnishment under Rule 62 with the motion; ask that garnished funds be held pending the ruling.
• Attach the proposed Answer: Many judges expect the movant's proposed responsive pleading to accompany the motion so the case can proceed immediately if relief is granted.

Sources and References

• Alabama Rules of Civil Procedure: https://judicial.alabama.gov/library/CivilProcedure
• Ala. R. Civ. P. 55(c) — setting aside a default / default judgment.
• Ala. R. Civ. P. 60(b) — relief from a final judgment (mistake, fraud, void judgment, other reason).
• Kirtland v. Fort Morgan Auth. Sewer Serv., Inc., 524 So. 2d 600 (Ala. 1988) — three-factor test: https://law.justia.com/cases/alabama/supreme-court/1988/524-so-2d-600-1.html
• Sampson v. Cansler, 726 So. 2d 632 (Ala. 1998) — "plausible defense" standard for a meritorious defense.
• Ala. Code § 6-2-37 (3-year limitation — open account): https://law.justia.com/codes/alabama/title-6/chapter-2/article-2/section-6-2-37/
• Ala. Code § 6-2-34 (6-year limitation): https://law.justia.com/codes/alabama/title-6/chapter-2/article-2/section-6-2-34/
• Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq.: https://www.ftc.gov/legal-library/browse/rules/fair-debt-collection-practices-act-text
• CFPB — time-barred debt: https://www.consumerfinance.gov/ask-cfpb/can-debt-collectors-collect-a-debt-thats-several-years-old-en-1423/
• AlaFile Electronic Filing System: https://efile.alacourt.gov/