The Appellate Group

Knight Adjustment v. Funaro

Knight Adjustment v. Funaro, 2021 UT App 65 (Hagen, J.)

Civil Procedure

Defendant successfully moved to set aside a default judgment that had been obtained against him by Plaintiff on the grounds that he had never been properly served. Nevertheless, Defendant filed an appeal arguing that the district court also should have dismissed the case with prejudice for lack of subject matter jurisdiction or because the statute of limitations had run. He also argued that the district court should have awarded him attorney fees. The Court of Appeals affirmed in part and reversed in part, holding:

  • failure to properly serve Defendant only meant that the district court lacked personal jurisdiction over him, not that it lacked subject matter jurisdiction over the case. Subject matter jurisdiction vests at the time the complaint is filed or when the summons or complaint are served. But service need not be effective for a court to exercise subject matter jurisdiction. Service impacts only personal jurisdiction.
  •  Because the court had subject matter jurisdiction over the case based on the complaint being filed, the court correctly declined to dismiss the case with prejudice, and the district court was correct not to entertain Defendant’s request to dismiss the case with prejudice due to statute of limitations as such an argument was premature.
  • Because the court had subject matter jurisdiction over the case, it should have conducted a hearing on whether attorney fees were appropriate, even without personal jurisdiction over Defendant. The case is remanded for a hearing on attorney fees.

Read the full court opinion