American Express v. Born

                                                                                              12/27/2023


                                          DA 23-0270
                                                                                        Case Number: DA 23-0270

              IN THE SUPREME COURT OF THE STATE OF MONTANA
                                          

AMERICAN EXPRESS NATIONAL BANK,

               Plaintiff and Appellant,

         v.

JOCELYN BORN,

               Defendant and Appellee.


APPEAL FROM:           District Court of the Thirteenth Judicial District,
                       In and For the County of Yellowstone, Cause No. DV-2022-858
                       Honorable Donald L. Harris, Presiding Judge


COUNSEL OF RECORD:

                For Appellant:

                       Stacey Hummel, Clifton Rodenburg, Dylan Evans, Rodenburg Law Firm,
                       Fargo, North Dakota

                For Appellee:

                       Jocelyn Born, Self-represented, Billings, Montana



                                                    Submitted on Briefs: September 13, 2023

                                                               Decided: December 27, 2023


Filed:

                                 v5,.
                       __________________________________________
                                         Clerk
Justice Jim Rice delivered the Opinion of the Court.

¶1     Appellant American Express National Bank (Amex) appeals the orders of the

Thirteenth Judicial District Court, Yellowstone County, which disallowed a “Stipulation

and Consent” entered by Amex and Defendant/Appellee Jocelyn Born (Born) for entry of

a consent judgment that Born was liable for an indebtedness of $19,368.19 to Amex, in

settlement of pending litigation, and dismissed the matter with prejudice. We address:

       Did the District Court err by disallowing the parties’ stipulation for entry of a
       consent judgment and dismissing the action with prejudice?

                  FACTUAL AND PROCEDURAL BACKGROUND

¶2     On August 23, 2022, Amex initiated this litigation by filing a complaint against

Born in the Thirteenth Judicial District Court, alleging that, as a holder of an American

Express credit card, Born had accumulated a debt of $20,754.69 that she had failed to repay

in accordance with her credit card agreement with Amex, despite Amex’s demands for

repayment.     In September 2022, the parties entered a “Stipulation and Consent”

(Stipulation) stating that “[Born] consents to the entry of judgment for the amount of

$20,754.69, costs of $233.50 and any additional costs and disbursements to date of

judgment,” and listing a total repayment amount of $20,988.19.1 In January 2023, this

Stipulation was submitted to the District Court, formatted as a pleading and filed in the



1
  See generally, Tidyman’s Mgmt. Servs. v. Nat’l Union Fire Ins. Co., 

, 

, 

 (“By definition, a stipulated or consent judgment is not a court’s or a
jury’s calculation of actual damages to which individual plaintiffs are entitled, but rather the
amount for which two parties have freely agreed to settle a claim. As we have said before, [a]
consent judgment is a judgment, the provision and terms of which are settled and agreed to by the
parties to the action.” (Internal quotation and citation omitted)).


                                               2
pending case, and signed by Born and counsel for Amex. Also submitted was an affidavit

submitted by Amex’s counsel certifying that the amount owed was the reduced amount of

$19,368.19, reflecting payments made by Born on the account.

¶3     The District Court initially entered a Judgment on Consent granting Amex a

judgment against Born in the amount of $19,368.19. However, later the same day, the

District Court entered an order vacating the judgment, and issued an accompanying order

dismissing the litigation with prejudice, reasoning that:

       The parties entered a Stipulation and Consent on or about September 28,
       2022 for $20,988.19 with monthly consecutive payment arrangements of
       $405.00. Now, American Express has filed an Affidavit alleging that Born
       defaulted on the payment arrangements agreed upon in the Stipulation and
       Consent. American Express asks the Court to enter a Judgment on Consent
       for $19,368.19, which is the principal amount of $20,754.69 plus costs and
       disbursements of $233.50, less payments in the amount of $1,620.00. To
       comport with the principle of Due Process, any alleged breach of the
       stipulation must be brought under a separate action to afford the Defendant
       notice and opportunity to be heard. The parties settled this case when they
       entered into their stipulation. The Court finds that the issues in dispute are
       moot.

(Emphasis added.)

¶4     Amex subsequently moved the District Court for relief under M. R. Civ. P. 60(b)(6),

or, alternatively, for a new trial under M. R. Civ. P. 59(a)(2). This motion was unopposed

by Born, but was denied. Amex appeals. Born did not file an appearance or briefing in

the appeal.

                               STANDARD OF REVIEW

¶5     As a “judgment, the provision and terms of which are settled and agreed to by the

parties to the action,” a consent judgment, having been agreed to by both parties, constitutes


                                              3
a contract. Tidyman’s, ¶ 20 (quoting First Bank, (N.A.) v. District Court for Fourth Judicial

Dist., 

, 

 (1987)). Akin to a settlement agreement,

the interpretation and construction of such contracts involve questions of law. Bender v.

Rosman, 

, 

, 

 (citing Jarussi v. Farber, 

, ¶ 15, 

, 

). Accordingly, we review a district court’s

related conclusions of law for correctness. Bender, ¶ 9 (citing In re Harms, 

,

¶ 12, 

, 

).

¶6     “Our standard of review of a district court’s ruling on a motion pursuant to M. R.

Civ. P. 60(b) depends on the nature of the final judgment, order, or proceeding from which

relief is sought and the specific basis of the Rule 60(b) motion.” Reservation Operations

Ctr. LLC v. Scottsdale Ins. Co., 

, 

, 

 (quoting

Essex Ins. Co. v. Moose’s Saloon, Inc., 

, 

, 

).

“As a general rule, the district court’s ruling is reviewed for abuse of discretion.” Essex,

¶ 16. However, in instances where “the specific basis of the motion is a conclusion of

law,” we review the motions’ denial de novo. El Dorado Heights Homeowners’ Ass’n v.

Dewitt, 

, 

, 

.

                                      DISCUSSION

¶7     Did the District Court err by disallowing the parties’ stipulation for entry of a
       consent judgment and dismissing the action with prejudice?

¶8     Amex contends the District Court erred by vacating the consent judgment initially

entered upon the parties’ Stipulation, and by denying its motion for relief from the order

dismissing the matter with prejudice. Amex argues there was no basis for the District Court


                                             4
to disallow the parties’ Stipulation and postulates, citing D. H. Overmyer Co. Inc., of Ohio

v. Frick Co., 

, 

 (1972), that the District Court mistook the filing

as a “cognovit judgment where the entry of judgment is conditioned on a default in advance

of legal action, rather than a judgment on consent where an agreed judgment is entered

after action is commenced.” (emphasis in original). See D. H. Overmyer Co. Inc., 

, 

 (“The cognovit is the ancient legal device by which the debtor

consents in advance to the holder’s obtaining a judgment without notice or hearing, and

possibly even with the appearance, on the debtor’s behalf, of an attorney designated by the

holder.”).

¶9     As noted above, a consent judgment is “a judgment, the provision and terms of

which are settled and agreed to by the parties to the action.” First Bank, (N.A.), 

, 

 (quoting Black’s Law Dictionary (5th ed.) at 436); Tidyman’s,

¶ 20. “A judgment by consent or stipulation of the parties is construed as a contract

between them embodying the terms of the judgment. It operates to end all controversy

between the parties, within the scope of the judgment.” First Bank, (N.A.), 

, 

. Then, “[c]ourts interpret contracts according to their plain and

ordinary meaning, in such a way as to give effect to the mutual intention of the parties as

it existed at the time of contracting.” Little Big Warm Ranch, LLC v. Doll, 

, 

, 

 (citing § 28-3-301, MCA). “The language of a contract

is to govern its interpretation if the language is clear and explicit and does not involve an

absurdity.” Section 28-3-401, MCA.



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¶10    Here, the Stipulation contained the parties’ mutual consent to resolve the pending

litigation on agreed-upon terms, plainly providing Born’s acknowledgment of the debt and

resolving the debt by Born’s monthly payments of $405 “until paid in full.”       Thus, the

Stipulation is clearly a valid consent judgment, “construed as a contract between [the

parties].” First Bank, (N.A.), 

, 

. Amex’s January

Affidavit had no impact on this arrangement, serving only to reduce the agreed-upon

judgment amount to reflect the $1,620 Born had paid on the debt. It appears the District

Court misunderstood these documents. Nothing in the Affidavit indicated that Born had

“defaulted on the payment arrangements,” that the judgment was entered upon such a

default, or was otherwise entered upon a pre-litigation agreement by Born, as the District

Court apparently believed. Accordingly, we conclude the District Court erred in its vacatur

of the judgment and abused its discretion by denying Amex’s motion for relief.

¶11    The order of dismissal is reversed and this matter is remanded for entry of a consent

judgment as contemplated by the parties’ Stipulation.


                                                 /S/ JIM RICE

We concur:

/S/ MIKE McGRATH
/S/ LAURIE McKINNON
/S/ BETH BAKER
/S/ JAMES JEREMIAH SHEA




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