Motion to Vacate Default Judgment (Debt Collection) - Minnesota

STATE OF MINNESOTA

DISTRICT COURT

[____________] JUDICIAL DISTRICT — COUNTY OF [____________]

Court File No. [____________]

DEFENDANT'S MOTION TO VACATE DEFAULT JUDGMENT

Filed Pursuant to Minn. R. Civ. P. 60.02

NOW COMES the Defendant, [____________] ("Defendant"), appearing [☐ pro se (self-represented) / ☐ by and through undersigned counsel], and respectfully moves this Court, pursuant to Minn. R. Civ. P. 60.02, to vacate the default judgment entered against Defendant in this action, to stay and dissolve any garnishment or execution issued upon it, and to grant Defendant leave to answer and defend on the merits. In support, Defendant states:

I. PROCEDURAL POSTURE AND THE JUDGMENT AT ISSUE

1. On or about [__/__/____], Plaintiff commenced this action against Defendant seeking to collect an alleged consumer debt in the amount of $[____________], allegedly arising from [☐ a credit-card account / ☐ a retail installment account / ☐ a personal loan / ☐ a charged-off account purchased by Plaintiff / ☐ other: [____________]].

2. On or about [__/__/____], a default judgment was entered against Defendant in the amount of $[____________], plus [☐ interest / ☐ costs / ☐ disbursements].

3. This Motion is timely. [Check the applicable basis:]
   ☐ The Motion is filed within one (1) year of entry of the judgment and within a reasonable time, as required for relief under Minn. R. Civ. P. 60.02(a)-(c).
   ☐ The Motion attacks the judgment as void under Minn. R. Civ. P. 60.02(d); the one-year limit does not apply, and the Motion is brought within a reasonable time after Defendant learned of the judgment.

4. Defendant has a reasonable, debatably meritorious defense to Plaintiff's claim, set forth in Part IV below and supported by the Affidavit attached as Exhibit A.

II. LEGAL STANDARD

5. Minn. R. Civ. P. 60.02 — grounds. On motion and upon such terms as are just, the court may relieve a party from a final judgment for: (a) mistake, inadvertence, surprise, or excusable neglect; (b) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59.03; (c) fraud (intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (d) the judgment is void; (e) the judgment has been satisfied, released, or discharged, or it is no longer equitable that it have prospective application; or (f) any other reason justifying relief from the operation of the judgment. The motion must be made within a reasonable time, and for reasons (a), (b), and (c) not more than one year after entry.

6. The Finden v. Klaas four-factor test. To vacate a default judgment, the moving party must satisfy the four-part test of Finden v. Klaas, 268 Minn. 268, 271, 128 N.W.2d 748, 750 (1964): the party must show (1) a reasonable [debatably meritorious] defense on the merits; (2) a reasonable excuse for the failure to answer or act; (3) that it acted with due diligence after notice of the entry of judgment; and (4) that no substantial prejudice will result to the opposing party if the motion is granted. "Default judgments are to be liberally reopened to promote resolution of cases on the merits," and Minnesota courts "liberally apply these factors to further the policy of resolving cases on their merits." A weak showing on one factor may be offset by a strong showing on the others, but all four are considered.

7. Reasonable defense on the merits. The movant need not prove the defense as at trial; it is enough to present a "debatably meritorious defense" supported by specific facts rather than a bare assertion. Northland Temporaries, Inc. v. Turpin, 744 N.W.2d 398, 403 (Minn. Ct. App. 2008).

8. Void judgment / defective service. A judgment is void if the court lacked personal jurisdiction over a party "through a failure of service that has not been waived." Failure of service is the classic ground for voidness as to a default judgment, because a court may not reach the merits before confirming that service was proper. A void judgment must be vacated under Rule 60.02(d); the Finden factors and the one-year limit do not bar relief from a void judgment.

III. GROUNDS FOR VACATING THE JUDGMENT

Defendant moves to vacate the default judgment on the following grounds:

☐ A. The judgment is VOID for defective service / lack of personal jurisdiction (Rule 60.02(d)). Defendant was never validly served with the Summons and Complaint in the manner required by Minn. R. Civ. P. 4. [Describe: ☐ Defendant did not reside at the address of purported service; ☐ no copy was left with a person of suitable age and discretion residing at Defendant's usual abode; ☐ "sewer service" — the affidavit of service is false; ☐ Defendant had moved before service; ☐ purported service through the Secretary of State or by publication was improper; ☐ other: [____________].] Because the Court never acquired personal jurisdiction, the judgment is void and must be vacated.

☐ B. Excusable neglect / mistake / surprise (Rule 60.02(a)) — Finden factors satisfied. Defendant's failure to answer resulted from excusable circumstances, not from a deliberate choice to ignore the suit; Defendant has a reasonable defense on the merits, acted with due diligence after learning of the judgment, and vacating will cause no substantial prejudice to Plaintiff. [Describe the excuse: ☐ Defendant did not receive the Summons; ☐ Defendant was hospitalized/incapacitated; ☐ Defendant reasonably relied on settlement communications; ☐ a clerical or mailing error; ☐ Defendant misunderstood the 21-day deadline while seeking counsel; ☐ counsel's neglect, where Defendant acted diligently (see Finden); ☐ other: [____________].]

☐ C. Fraud, misrepresentation, or misconduct (Rule 60.02(c)). Plaintiff obtained the judgment by fraud, misrepresentation, or misconduct — for example, by filing a false affidavit of service or knowingly using an incorrect address for Defendant. [Describe: [____________].]

☐ D. Newly discovered evidence (Rule 60.02(b)). [Describe: [____________].]

☐ E. Satisfaction / no longer equitable (Rule 60.02(e)) or any other reason justifying relief (Rule 60.02(f)). Relief under the residual clause (f) is appropriate where the equities weigh heavily in favor of Defendant and relief is required to avoid an unconscionable result. [Describe: [____________].]

☐ F. Reasonable defense on the merits. Defendant has a debatably meritorious defense to Plaintiff's claim, as set forth in Part IV.

IV. REASONABLE DEFENSE ON THE MERITS (DEBT-SPECIFIC)

9. Defendant has the following reasonable, debatably meritorious defense(s) to Plaintiff's claim:

☐ Statute of limitations. The alleged consumer debt is time-barred. An action on a consumer debt primarily for personal, family, or household purposes must be commenced within six (6) years under Minn. Stat. § 541.053, and the claim accrued more than six years before suit was commenced. [Verify the accrual date and any applicable tolling rule.]

☐ Mistaken identity / identity theft / wrong defendant. Defendant is not the person who incurred the alleged debt, did not open the account, and is the victim of mistaken identity or identity theft. [☐ A police report and/or FTC Identity Theft Report has been filed: [____________].]

☐ Incorrect amount. The amount of the judgment is incorrect, inflated, or includes interest, fees, or charges not authorized by the agreement or by law, and/or fails to credit payments made.

☐ Paid, settled, or discharged. The alleged debt has been paid, satisfied, settled, released, or discharged (including discharge in bankruptcy — Case No. [____________], [____________] Bankruptcy Court).

☐ Lack of standing / no proof of assignment. Plaintiff is a debt buyer that has not proven it owns the account. Plaintiff failed to establish a complete, unbroken chain of assignment from the original creditor identifying Defendant's specific account, and is not the real party in interest.

☐ Potential separate FDCPA claim—not by itself a defense that the debt is invalid. If a qualifying debt collector failed to provide the notice or verification required by 15 U.S.C. § 1692g, Defendant may have a separate civil claim under 15 U.S.C. § 1692k. A formal pleading is not an “initial communication” under § 1692g(d). Plead such a claim only if procedurally permitted, and evaluate any state-law issue separately.

☐ Unlicensed / non-registered collector. Plaintiff and/or its agent collected the alleged debt without the license or registration required under Minn. Stat. ch. 332. [Verify license/registration status with the Minnesota Department of Commerce before relying on this defense.]

☐ Other reasonable defense: [____________].

V. DEFENDANT'S AFFIDAVIT IN SUPPORT (EXHIBIT A)

STATE OF MINNESOTA
COUNTY OF [____________]

[____________], being first duly sworn on oath, deposes and states:

1. I am the Defendant in this action. I make this Affidavit on personal knowledge in support of my Motion to Vacate Default Judgment.

2. [Service facts: e.g., "I was never served with the Summons and Complaint in this case. On the date service is claimed, I did not reside at [address], and no copy was left with anyone of suitable age and discretion at my usual place of abode."] [____________]

3. Reasonable excuse / diligence (Finden factors 2 and 3): [e.g., "I first learned of this lawsuit and judgment on [date], when [a garnishment / a bank levy / a credit-report entry] alerted me to it. I contacted [counsel / the court] within [____] days and promptly prepared this motion."] [____________]

4. Reasonable defense on the merits (Finden factor 1): [SPECIFIC facts: e.g., "I never opened the account that is the subject of this suit," or "I paid this account in full on [date], as shown by the document attached as Exhibit ____," or "The last payment or activity on this account occurred on [date], more than six years before this action was commenced."] [____________]

5. No substantial prejudice (Finden factor 4): Vacating the judgment will not substantially prejudice Plaintiff; the relevant records and witnesses remain available, and any delay can be addressed by the Court on just terms.

6. I respectfully request that the Court vacate the default judgment and permit me to answer and defend this case on its merits.

Further your affiant sayeth not.

_______________________________________
[____________], Defendant/Affiant

Subscribed and sworn to before me this [____] day of [____________], 20[____].

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

VI. REQUEST TO STAY AND DISSOLVE GARNISHMENT AND EXECUTION

10. Defendant requests that the Court stay all enforcement of the judgment — including any garnishment summons (wage or bank), writ of execution, levy, and recording or enforcement of any judgment lien — pending the Court's ruling on this Motion. Enforcement against Defendant's [wages / bank account / property] would cause irreparable harm before the Court can determine whether the judgment is valid.

11. If a garnishment summons or execution has already issued, Defendant requests that the Court dissolve and quash it and order the return of any funds already garnished if and when the judgment is vacated. [Garnishment/Writ No., if known: [____________].]

VII. RELIEF REQUESTED

WHEREFORE, Defendant respectfully requests that this Court:

A. Vacate the default judgment entered against Defendant on [__/__/____] under Minn. R. Civ. P. 60.02;

B. Dissolve and quash any garnishment summons, execution, levy, or attachment issued on the judgment, and order the return of any sums collected;

C. Stay all enforcement of the judgment pending resolution of this Motion;

D. Grant Defendant leave to serve and file an Answer and to defend this action on the merits within [____] days; and

E. Grant such other and further relief as the Court deems just and proper, on such terms as are just.

VIII. PROPOSED ORDER

A proposed Order granting this Motion is submitted herewith. [Attach a separate "Order Vacating Default Judgment" reciting that the judgment entered [__/__/____] is vacated, any garnishment/execution is dissolved, enforcement is stayed, and Defendant is granted leave to answer within ____ days.]

IX. SIGNATURE

Dated this [____] day of [____________], 20[____].

Respectfully submitted,

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

X. 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 Vacate Default Judgment, the supporting Affidavit, and the proposed Order upon Plaintiff's attorney of record (or upon Plaintiff, if unrepresented) by:

☐ Minnesota eFS (eFile & eServe) electronic service (where applicable)
☐ U.S. First-Class Mail, postage prepaid
☐ Hand Delivery
☐ Email (by agreement / where permitted)

Addressed to:

[____________________________________]
[____________________________________]
[____________________________________]

/s/ [____________________________________]
[____________________________________]

MINNESOTA PRACTICE NOTES

• Rule 60.02 timing: A motion must be made within a reasonable time, and for grounds (a) mistake/inadvertence/surprise/excusable neglect, (b) newly discovered evidence, and (c) fraud, not more than one (1) year after entry. A motion attacking the judgment as void under Rule 60.02(d) (defective service) is not subject to the one-year cap but must still be brought within a reasonable time.
• The Finden v. Klaas four-factor test governs vacating a default judgment: (1) a reasonable (debatably meritorious) defense on the merits; (2) a reasonable excuse for failing to answer/act; (3) due diligence after notice of entry of judgment; and (4) no substantial prejudice to the opposing party. Finden v. Klaas, 268 Minn. 268 (1964). Minnesota courts apply the factors liberally to favor decisions on the merits. A weak factor can be offset by strong showings on the others.
• Reasonable defense: A "debatably meritorious defense" supported by specific facts, not a bare assertion. Northland Temporaries v. Turpin, 744 N.W.2d 398 (Minn. Ct. App. 2008).
• Void / defective service is the strongest ground: A judgment entered without valid Rule 4 service is void for lack of personal jurisdiction and must be vacated under Rule 60.02(d) regardless of the Finden factors. See also Minn. R. Civ. P. 4.043 (relief to a defendant not personally notified).
• Conciliation Court is different: A default in Conciliation Court (small claims) is addressed through its own removal/vacatur procedures, not this District Court motion.
• Statute of limitations on consumer debt: Six (6) years under Minn. Stat. § 541.053; after expiration, payment, bankruptcy discharge, or oral or written reaffirmation does not revive the period. Verify accrual and any tolling before relying on this defense.
• Stay collection immediately: A pending Rule 60.02 motion does not automatically suspend a garnishment; request a stay/dissolution expressly.

Sources and References

• Minn. R. Civ. P. 60 (Relief from Judgment or Order): https://www.revisor.mn.gov/court_rules/cp/id/60/
• Finden v. Klaas, 268 Minn. 268, 128 N.W.2d 748 (1964): https://law.justia.com/cases/minnesota/supreme-court/1964/39-132.html
• Northland Temporaries, Inc. v. Turpin, 744 N.W.2d 398 (Minn. Ct. App. 2008)
• Minn. R. Civ. P. 55 (Default): https://www.revisor.mn.gov/court_rules/cp/id/55/
• Minn. R. Civ. P. 4 (Process/Service): https://www.revisor.mn.gov/court_rules/cp/id/4/
• Minn. Stat. § 541.053 (Six-Year Consumer-Debt Limitation): https://www.revisor.mn.gov/statutes/cite/541.053
• Minn. Stat. ch. 332 (Collection Agencies; Regulation of Collection Practices): https://www.revisor.mn.gov/statutes/cite/332
• 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/