www.loubar.org 14 Louisville Bar Briefs HAYNIE & REYNOLDS FAMILY LAW MEDIATION Judge Hugh Smith Haynie (ret.) Rebecca C. Reynolds FOR SCHEDULING, PLEASE CONTACT [email protected], OR CALL (502) 354-5049. ✓ CCo-mediators specializing in the most complex divorce and custody cases ✓ NNo charge for preparation of your case ✓ W We will simultaneously draft the agreement for you, saving you and your clients time and money A Void Judgment Can Be Worth the Paper It Is Printed On Brian Pollock, J. Gabriel Dennery and Joshua Wolford The U.S. Supreme Court recently granted certiorari to consider a case in which the Sixth Circuit affirmed a bankruptcy court’s denial of a Rule 60(b)(4) motion to vacate a purported void judgment. The Federal Rules of Bank- ruptcy Procedure, with a few exceptions and some modifications, adopt the Federal Rules of Civil Procedure in the bankruptcy case and adversary proceedings. The Sixth Circuit’s ap- plication of these rules in Coney Island Auto Parts Unlimited, Inc. v. Burton (In re Vista- Pro Automotive, LLC), 109 F.4th 438 (6th Cir. 2024), held that a purported void judgment could be enforced against a dilatory judgment debtor, and the U.S. Supreme Court will now consider this departure from the holdings of several other circuits. As debated below, the decision on this issue will have implications beyond the bankruptcy courts—and even into state courts—which practitioners should consider in advising their clients. Majority Requires Timeliness The court’s ruling placed the emphasis where it belonged—on what the Federal Rules of Civil Procedure plainly say. Rule 60(c)(1) states that all motions under Rule 60(b) must be filed within a reasonable time and Appellant’s motion under Rule 60(b)(4) was subject to that requirement. The Rule’s unequivocal language precludes any other result. The court found support in United States v. Dailide, 316 F.3d 611 (6th Cir. 2003), in which Dailide waited four years to move to vacate a judgment under Rule 60(b)(4). Dailide argued that the lower court had entered judgment without subject-matter jurisdiction, and so the judgment was void. The Sixth Circuit af- firmed the district court’s denial of his motion, holding that a Rule 60(b)(4) motion is only cognizable if brought within a reasonable time, and his delay made his motion untimely. The appellant (and the dissent) attempted to distinguish Dailide because it concerned subject-matter jurisdiction, as opposed to personal jurisdiction, and argued that the latter implicates due-process rights. But the court correctly dispensed with appellant’s due- process arguments. For one, the appellants did not challenge Rule 60 on constitutional grounds—it only argued that Dailide’s hold- ing was limited to challenges to judgments void for lack of subject-matter jurisdiction. However, Rule 60(c)(1) places a timeliness requirement on all motions for relief from void judgments. Certainly, one cannot argue that a judgment entered without personal jurisdic- tion is more void than one entered with a lack of subject-matter jurisdiction. As the court noted, a void judgment is a void judgment, and Rule 60(c)(1) does not distinguish between types of void judgments. Moreover, personal jurisdiction, unlike subject-matter jurisdiction (as was the issue in Dailide), is waivable. And as a practical matter, due process was not implicated here because the appellant became aware of the judgment in 2016 and sat on its rights until 2022. Because the court relied upon the plain lan- guage of the rule, a large portion of its analy- sis was targeted at the dissent’s misapplication of inapposite case law. The dissent relied upon Antonie v. Atlas Turner, Inc., 66 F.3d 105 (6th Cir. 1995), which also concerned a Rule 60(b)(4) motion. But the Antonie court never mentioned the timeliness issue, and it is improper to speculate as to a court’s holding on issues it elects not to address. Likewise, the dissent’s reliance on United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260 (2010), was misguided, as Espinosa also failed to ad- dress the timeliness issue. Finally, the court noted that its decision com- ports with basis equitable principles. Not only do the rules and circuit precedent compel the result reached, so does common sense and equity. A judgment debtor sitting on its rights for years prejudices the judgment holder, undermines the finality of judgments and “upsets reliance interests.” As the court said, “[i]t is not clear why Rule 60 should be given an atextual meaning to permit such results.” And on the flip side, requiring timely motions for relief from void judgments does not leave a judgment debtor with no recourse. Ultimately, a court faced with this issue will look to the facts of the case, including the reason for the delay, in determining what constitutes an “unreasonable” delay. In so holding for the appellees, the court refused to chase phantoms and provided the only outcome that is faithful to the rule’s plain language. Indeed, if the drafters meant to prevent a district court from ever dismissing 60(b)(4) motions as untimely, mandating a reasonable-time limit for such motions was “an odd way to express it.” Dissent Requires Due Process Judge McKeague’s dissenting opinion provides a well-reasoned counterargument to the Sixth Circuit’s decision categorically barring a Rule 60(b) motion to vacate on the basis of untimeliness alone. The dissent provides an arguably more common sense interpretation of the federal rule at issue, and, relying on binding Supreme Court precedents, gives the appropriate weight to due process. Rule 60(b)(4) provides that “[o]n motion and just terms, the court may relieve a party or its legal representative from a final judgment, order, or proceeding” where “the judgment is void.” Rule 60(c)(1) provides that a “mo- tion under Rule 60(b) must be made within a reasonable time.” The majority interpreted this term “reasonable” to mean that equity permits a court to enforce a default judgment against a party if that party takes too long to protest the court’s authority, even if that party never received proper service—a constitu- tional prerequisite for a valid suit—because acknowledging a violation of due process or jurisdictional error “does not tell us what to PROFESSIONAL EXCELLENCE (Continued on next page) KLRS WELCOMES NEW MEMBERS TO THE SERVICE. Connor Breen, Richard Breen Law Offices, PSC Insurance and Tort Law Joseph Gaines, Attorney at Law, P.S.C. 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