Utah's New Default Judgment Rule: Monumental Change Makes Life Difficult for Creditors

Terry Jessop & Bitner Newsletter

Issue 25, September 2015

Effective July 8, 2015, the Utah Supreme Court added another step to the requirements for obtaining a default judgment in any of the courts in the State of Utah. Rule 55(b)(1)(D) of the Utah Rules of Civil Procedure now states that in order to obtain a default judgment, the plaintiff must file a verified complaint, an affidavit, or a sworn declaration, which: (1) sets forth facts necessary to establish the amount of the claim, after deducting all credits to which the defendant is entitled; and (2) verifies the amount is warranted by information in the plaintiff's possession. In short, the Supreme Court wants a sworn statement from an agent of the Plaintiff, not just the attorney, in every case before allowing default judgment.

WE'LL NEED YOUR JOHN HANCOCK

Unfortunately, this new rule will markedly change the way most creditors and their attorneys process debt collection lawsuits. Prior to this change, an attorney could obtain a default judgment on behalf of his or her client as a matter of routine process as long as: (1) the defendant failed to appear and defend; (2) the defendant was not an infant or incompetent person; (3) the defendant was properly served with a copy of the summons and complaint; and (4) the claim was for a sum certain (a fixed or specific, calculable amount without room for ambiguity). Each of these requirements could be presented to the court by the attorney in the complaint and default documents without the creditor's direct involvement or signature.

The rule change now calls for a fifth element, requiring a verified complaint, affidavit, or sworn declaration signed by the plaintiff. This means that the attorney must at some point draft a document for which he or she seeks the involvement, review, and signature of the creditor. This may not seem like a monumental effort if we're talking about one case. But, multiplied over hundreds of cases or many years, this added step will undoubtedly have a major impact on creditors' time and the cost of obtaining default judgments.

THE SMART SOLUTION

As with almost any business or legal task, time and cost are saved when the process can be automated or standardized. The added step threatens to interrupt or slow the process of obtaining a default judgment. To lessen its impact, creditors should create a declaration template that can be quickly customized, signed, and sent to an attorney as a matter of course at the start of each collection case. This would eliminate the need for the attorney to send a proposed declaration to the creditor for each case, wait for the creditor to sign it and send it back, only then to be able to file for default judgment. Adding such a template to the document package delivered to your attorney will save time and cost, especially for creditors who file large quantities of collection cases. Give us as call and we can generate or help you create an appropriate template.

© Terry Jessop & Bitner September 2015