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

STATE OF WISCONSIN CIRCUIT COURT — [____________] COUNTY

Case No. [____________]

Case Classification Code: [____________]

Assigned Judge: [____________]

DEFENDANT'S MOTION TO SET ASIDE / VACATE DEFAULT JUDGMENT

Filed Pursuant to Wis. Stat. § 806.07

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 Wis. Stat. § 806.07. 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 [__/__/____] under Wis. Stat. § 806.02 in the amount of $[____________], plus [interest, costs, and/or fees].

2. Defendant was not validly served 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 should be set aside under Wis. Stat. § 806.07.

3. Wisconsin policy favors deciding cases on their merits. Section 806.07(1)(h) "is to be liberally construed to allow relief from judgments whenever appropriate to accomplish justice." Conrad v. Conrad, 92 Wis. 2d 407, 284 N.W.2d 674 (1979).

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:

☐ An earnings garnishment served on Defendant's employer (Wis. Stat. ch. 812)
☐ A bank/account garnishment or levy
☐ A post-judgment supplementary-examination notice or writ of execution
☐ A docketed-judgment lien or 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 limit under Wis. Stat. § 806.07(2).

III. LEGAL STANDARD

8. Section 806.07 — relief from judgment. "On motion and upon such terms as are just," the Court may relieve a party from a judgment for, among other reasons: (a) mistake, inadvertence, surprise, or excusable neglect; (b) newly-discovered evidence; (c) fraud, misrepresentation, or other misconduct of an adverse party; (d) the judgment is void; (e) the judgment has been satisfied, released, or discharged; or (h) any other reasons justifying relief from the operation of the judgment. Wis. Stat. § 806.07(1).

9. Timing. The motion must be made within a reasonable time, and if based on § 806.07(1)(a) or (c), not more than one year after the judgment was entered. Wis. Stat. § 806.07(2). The reasonable-time requirement does not bar relief from a judgment that is genuinely void. See Neyland v. Vorwald.

10. Excusable neglect. Excusable neglect is neglect that might have been the act of a reasonably prudent person under the same circumstances; it is not synonymous with carelessness or inattentiveness. A movant ordinarily must also show the existence of a meritorious defense so that the Court may decide the case on its merits.

11. A judgment without valid service is void. A Wisconsin court obtains personal jurisdiction only through service that complies with Wis. Stat. § 801.11. A default judgment entered where the defendant was never properly served is void and is subject to being vacated under § 806.07(1)(d). [Note: build the record of when Defendant first learned of the suit and the judgment.]

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 Wis. Stat. § 801.11. Specifically: [describe — e.g., "Defendant did not live at the address where service was attempted," "no competent member of Defendant's household was served," "service by publication was used without the diligent search the statute requires," "Defendant first learned of the suit only through the garnishment"]. Because the Court lacked personal jurisdiction, the judgment is void. Wis. Stat. § 806.07(1)(d).

☐ B. Mistake, inadvertence, surprise, or excusable neglect. Defendant's failure to respond was the result of excusable neglect — the act of a reasonably prudent person under the circumstances — in that: [describe — e.g., "Defendant was hospitalized," "the papers were misdelivered or received late," "Defendant reasonably believed the matter had been disputed/resolved with the collector," "Defendant did not understand the return date or deadline"]. Wis. Stat. § 806.07(1)(a).

☐ C. Fraud, misrepresentation, or other misconduct of an adverse party. 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"]. Wis. Stat. § 806.07(1)(c).

☐ D. Newly-discovered evidence. Defendant has discovered evidence entitling Defendant to a new trial that could not, with reasonable diligence, have been discovered earlier, namely: [describe]. Wis. Stat. § 806.07(1)(b).

☐ E. The judgment has been satisfied, released, or discharged. [Describe — e.g., paid in full, settled, or discharged in bankruptcy.] Wis. Stat. § 806.07(1)(e).

☐ F. Any other reasons justifying relief. Extraordinary circumstances justify relief from the operation of the judgment, namely: [describe]. Wis. Stat. § 806.07(1)(h).

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

V. DEFENDANT HAS A MERITORIOUS DEFENSE

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

☐ Statute of limitations. The alleged debt is time-barred. Under Wis. Stat. § 893.43, an action on a contract — including a written or oral contract, an open account, or a promissory note — must be commenced within six (6) years, running generally from when the debt became due or from the last payment. The last payment/activity on the account occurred on or about [__/__/____], more than six years before suit was filed. [Verify the accrual/last-payment date; note the borrowing statute, Wis. Stat. § 893.07, which can apply a shorter foreign period.]

☐ 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 under Wis. Stat. § 803.01.

☐ No § 1692g validation; FDCPA / Wisconsin Consumer Act violations. Plaintiff and/or its predecessor failed to provide the validation notice and verification required by 15 U.S.C. § 1692g, sued on a time-barred or unverified debt, and/or violated the Wisconsin Consumer Act (Wis. Stat. chs. 421-427), including the prohibited debt-collection practices in ch. 427 and the required notice of right to cure default under Wis. Stat. §§ 425.104-425.105. Plaintiff's noncompliance bars or limits recovery and may give rise to the remedies in Wis. Stat. §§ 425.301-425.308.

☐ Plaintiff not licensed under Wis. Stat. § 218.04. To the extent Plaintiff is a "collection agency," it must be licensed; Plaintiff has failed to plead or prove a valid license. [Verify Plaintiff's status and any exemption.]

☐ Other meritorious defense: [____________]

13. These defenses are substantiated by the facts in Defendant's Affidavit, below, and the attached exhibits, and warrant deciding the case on its merits.

VI. NO UNFAIR PREJUDICE TO PLAINTIFF

14. No unfair prejudice. Setting aside the judgment will cause Plaintiff no unfair prejudice. The relevant inquiry is the 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. The interests of justice favor deciding this disputed debt on its merits.

VII. DEFENDANT'S AFFIDAVIT

STATE OF WISCONSIN )
COUNTY OF [____________] ) ss.

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

1. I am the Defendant in this action. I am over the age of eighteen (18) 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 levied"].

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

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

_______________________________________
Notary Public, State of Wisconsin
My commission expires/is permanent: [__/__/____]

VIII. REQUEST TO STAY EXECUTION AND GARNISHMENT

15. Defendant requests that the Court stay execution and enforcement of the judgment — including any earnings garnishment (Wis. Stat. ch. 812), bank/account garnishment, levy, or other post-judgment process — pending the Court's ruling on this motion. 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.

16. 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 [__/__/____] pursuant to Wis. Stat. § 806.07;

B. STAY all execution, earnings/bank 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 earnings 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 under Wis. Stat. § 806.07. Having considered the motion, the supporting affidavit, any response, and the applicable law, the Court finds that the motion should 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.

BY THE COURT, this ____ day of __________, 20____.

_________________________________
Circuit Court Judge / Circuit Court Commissioner

XI. SIGNATURE

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

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

XII. CERTIFICATE OF SERVICE

I 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 Wis. Stat. § 801.14, by the following method:

☐ Wisconsin Circuit Court eFiling system (notice to all counsel of record; mandatory for attorneys under Wis. Stat. § 801.18)
☐ U.S. First-Class Mail, postage prepaid
☐ Certified Mail, Return Receipt Requested
☐ Hand Delivery
☐ Email (by agreement / where permitted)

Addressed to:

[____________________________________]
[____________________________________]
[____________________________________]

/s/ [____________________________________]
[____________________________________]

WISCONSIN PRACTICE NOTES

• Authority and deadline. Relief from a default judgment in Wisconsin is sought under Wis. Stat. § 806.07 (not a "Rule 55/60"). The motion must be made within a reasonable time, and if based on § 806.07(1)(a) (mistake/inadvertence/surprise/excusable neglect) or (1)(c) (fraud/misrepresentation/misconduct), not more than one (1) year after entry. Wis. Stat. § 806.07(2). Relief for a void judgment (§ 806.07(1)(d)) or "any other reasons justifying relief" (§ 806.07(1)(h)) is governed only by the reasonable-time standard; the reasonable-time requirement does not bar a genuine void-judgment attack (Neyland v. Vorwald). A delay of more than six months has been held unreasonable on its facts (Rhodes v. Terry, 91 Wis. 2d 165 (1979)) — file promptly.
• Default judgment entered under § 806.02. Confirm whether the judgment was entered on the ordinary civil track or the small claims/return-date track (ch. 799). A § 806.07 motion is the vehicle to reopen either.
• Excusable neglect + meritorious defense. Excusable neglect is judged by the reasonably-prudent-person standard and is not mere carelessness; the movant ordinarily must also show a meritorious defense. Hansher v. Kaishian, 79 Wis. 2d 374 (1977); Charolais Breeding Ranches v. Wiegel, 92 Wis. 2d 498 (1979).
• Void for defective service. Personal jurisdiction requires service compliant with Wis. Stat. § 801.11; a judgment entered without valid service is void and may be vacated under § 806.07(1)(d). Common in debt cases where the consumer first learns of the suit through a garnishment ("sewer service").
• Wisconsin Consumer Act. Chs. 421-427 govern consumer credit transactions; ch. 427 addresses prohibited collection practices, §§ 425.104-425.105 the notice-of-right-to-cure procedure, and §§ 425.301-425.308 remedies and penalties (including customer's attorney's fees under § 425.308). Section 425.205 governs the return-date replevin procedure for recovering collateral. These provide both defenses and post-vacatur counterclaim leverage.
• Stay/exemptions. A § 806.07 motion does not itself suspend the judgment (§ 806.07(2)); request a stay order and protect exempt property under Wis. Stat. § 815.18 and the earnings-garnishment exemptions in ch. 812.
• Attach the proposed Answer. Provide the proposed responsive pleading so the case can proceed immediately if relief is granted.

Sources and References

• Wis. Stat. § 806.07 (relief from judgment or order): https://docs.legis.wisconsin.gov/document/statutes/806.07
• Wis. Stat. § 806.02 (default judgment): https://docs.legis.wisconsin.gov/document/statutes/806.02
• Wis. Stat. § 801.11 (personal jurisdiction; serving the summons): https://docs.legis.wisconsin.gov/document/statutes/801.11
• Wis. Stat. § 893.43 (action on contract — 6 years): https://docs.legis.wisconsin.gov/statutes/statutes/893/43
• Wis. Stat. ch. 425 (Consumer Transactions — Remedies and Penalties): https://docs.legis.wisconsin.gov/statutes/statutes/425
• Wis. Stat. § 425.205 (action to recover collateral; return-date procedure): https://docs.legis.wisconsin.gov/document/statutes/425.205
• Wis. Stat. ch. 427 (Consumer Transactions — Debt Collection): https://docs.legis.wisconsin.gov/statutes/statutes/427
• Wis. Stat. § 218.04 (collection agencies): https://docs.legis.wisconsin.gov/document/statutes/218.04
• Conrad v. Conrad, 92 Wis. 2d 407, 284 N.W.2d 674 (1979) — § 806.07(1)(h) liberally construed.
• Rhodes v. Terry, 91 Wis. 2d 165, 280 N.W.2d 248 (1979) — "reasonable time."
• 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/