What constitutes excusable neglect under Utah rule 60(b)(1)? Asset Acceptance v. Stocks Explained

In Asset Acceptance v. Stocks, the Utah Court of Appeals addressed the boundaries of excusable neglect under rule 60(b)(1) when a defendant completely fails to respond to discovery requests and summary judgment motions despite clear warnings of potential consequences.

Background and Facts

Stocks timely answered Asset Acceptance’s credit card debt collection complaint, asserting that the action was barred by the four-year statute of limitations for open accounts under Utah Code section 78B-2-307. Asset Acceptance then served discovery requests with prominent warnings that failure to respond within 28 days would result in deemed admissions and potential judgment. Despite these clear warnings in bold print, Stocks did not respond. Asset Acceptance subsequently filed a motion for summary judgment, again warning that failure to respond could result in judgment being entered. Stocks again failed to respond, and the district court granted summary judgment.

Key Legal Issues

The primary issue was whether Stocks demonstrated excusable neglect sufficient to warrant setting aside the judgment under rule 60(b)(1). The court also considered but declined to resolve the novel question of which statute of limitations applies to credit card debt—the four-year period for open accounts or the six-year period for written instruments.

Court’s Analysis and Holding

The court of appeals affirmed on alternative grounds, finding that Stocks failed to establish excusable neglect. The court emphasized that excusable neglect requires “the exercise of due diligence by a reasonably prudent person under similar circumstances.” Stocks’s complete failure to respond to multiple warnings demonstrated either that he failed to read the documents (showing no diligence) or consciously disregarded explicit warnings (showing willful neglect). Neither scenario qualified as excusable neglect, as “mere neglect alone is an insufficient justification for relief.”

Practice Implications

This decision reinforces that Utah courts require actual diligence, not just good intentions, for rule 60(b) relief. The court’s refusal to reach the statute of limitations issue also demonstrates judicial restraint in addressing questions of first impression when the procedural posture is unsuitable for comprehensive analysis. The dissent argued that the important statute of limitations question deserved resolution despite procedural deficiencies.