United States District Court, D. North Dakota
Leland Oil & Gas, LLC, and K and R Roustabout, Inc., Plaintiffs,
Marsha Azar and Saul Azar dba Illinois Energy, and Bensun Energy, LLC, Defendants.
ORDER DENYING RULE 60(B)(6) MOTION TO SET ASIDE THE
CHARLES S. MILLER, JR., MAGISTRATE JUDGE UNITED STATES
case commenced in December 2014, with the filing of a
complaint by plaintiffs Leland Oil & Gas, LLC
(“Leland Oil”) and K and R Roustabout, Inc.
(“K and R Roustabout”). Defendant Bensun Energy,
LLC (“Bensun Energy”) never appeared and
eventually a default judgment was entered against it. (Doc.
Nos. 44-46). Defendant Saul Azar made two requests for
additional time to respond to the complaint following
service. The court granted these requests but indicated that
any further request would likely be denied. (Doc. Nos.
16-18). Finally, on April 13, 2015, an answer was filed on
behalf of both Saul and Marsha Azar (collectively the
“Azars”). (Doc. No. 19).
the parties submitted their proposed litigation plan,
court issued its progression order dated June 11, 2015, in
which it set forth milestones for completion of discovery,
disclosure of experts and their reports, and deadlines for
filing pretrial motions as requested by the parties in their
proposed scheduling plan. On the same date, the court set the
trial for May 17, 2016.
October 23, 2015, the plaintiffs filed a motion for partial
summary against Marsha and Saul Azar, dba Illinois Energy,
that was limited to addressing issues of liability. (Doc. No.
35). The motion was supported by affidavit testimony and
other evidence establishing a basis for why the plaintiffs
were entitled to the partial summary judgment they requested.
(Doc. No. 36). When, after approximately three months, there
was no response by the Azars, the court entered an order
granting the partial summary judgment on January 22, 2016. In
its order, the court referenced the court's local rule
governing dispositive motions which provides that failure to
respond may deemed an admission that the motion is well-taken
and subject to a summary ruling. (Doc. No. 44). See
D.N.D. Civ. L. R. 7.1(F).
13, 2017, the Friday before the trial that was set to
commence on Tuesday May 17, 2016, the Azars' attorney
filed a motion to withdraw indicating that he had been
discharged by the Azars the day prior. (Doc. No. 50). The
motion was supported by affidavits executed by both Saul and
Marsha Azar in which they agreed to the withdrawal and
acknowledged being aware of the trial date.
court held a hearing on the motion to withdraw on Monday, May
16, 2017. The plaintiffs appeared with their counsel and Saul
Azar appeared with the Azars' counsel. Marsha Azar did
not appear even though she acknowledged in her earlier
affidavit she was aware of the trial date. (Doc. Nos. 47
the hearing and in a letter that the court received as an
exhibit, Saul Azar contended he had not been informed of the
trial date until May 10, 2016, and that he had not been aware
of it previously. He also indicated he needed more time to
obtain an expert to defendant against the claim for lost
profits being made by Leland Oil.
court then inquired of Azars' counsel whether he had
provided his clients with notice of the trial date and
counsel stated he had some time ago, both in writing and by
phone call, and then again more recently. (Id.). The
court also inquired of the plaintiffs what their position was
with respect to the request for a continuance. Plaintiffs
objected, stating that they had already traveled some
distance for the trial and had arranged for their expert to
be present the next day. They also added that the Azars
throughout the case had been basically “no shows”
in that they had not responded to the motion for partial
summary judgment, they had not responded to the
plaintiffs' discovery requests, and Saul Azar had failed
to show up for his deposition. (Id.).
considering what was presented at the hearing and not
believing Saul Azar's contention that he never had been
advised of the trial date until May 10, 2016, the court
refused to continue the trial and gave the Azars a choice:
either proceed pro se or proceed with their chosen
counsel. (Id.). The next day, May 17, 2016, Saul
Azar attended the trial, electing at that point to proceed
with his attorney. (Doc. Nos. 53 & 66). Marsha Azar was
again a “no show.”
after the trial, the Azars retained new counsel who formally
made their appearance on July 1, 2016. On the same date, they
also filed a “Motion to File Posttrial Evidence”
without, however, indicating what evidence they wanted to
present. Also, notable with respect to what follows: (1)
transcripts of both the trial and the hearing in which the
court denied the request to continue were filed on July 19,
2016. (Doc. Nos. 65-66); (2) the Azars' new counsel were
the ones who filed the Azars' proposed findings and
conclusions as well as both an opening posttrial brief and a
reply brief (Doc. Nos. 67, 68, & 72); and (3) no further
request was made by Azars' new counsel during the next
seven months before the court reached its decision to reopen
the record based on the reasons set forth in the present
motion, including that the court should (a) consider
additional evidence based upon the original counsel's
gross neglect and backed by a proffer of evidence or (b)
consider additional evidence backed by an offer of proof or
to reconsider the court's earlier grant of partial
summary judgement on the grounds that the court had
procedurally erred in granting it.
February 27, 2017, the court made its findings of fact and
conclusions of law. On the same date, the court entered a
final judgment in favor of the plaintiffs and against
defendants Marsha and Saul Azar. (Doc. Nos. 75-76).
no direct appeal was taken. Further, despite having all of
the information available to them necessary to make the
present motion within a month or so of the trial, Azars'
new counsel did not file the present motion until June 14,
2017, which was another 4½ months. (Doc. No. 80).
court entered judgment in this case on two separate, but
related, claims. The first was a claim by Leland Oil that the
Azars had breached an agreement pursuant to which the Azars
had sold Leland Oil and Bensun Energy, LLC (“Bensun
Energy”) two oil and gas wells - the Davis State and
the Sullivan. More specifically, the claim was that the Azars
breached the sales agreement by failing to timely file with
the North Dakota Industrial Commission (“NDIC”) a
properly completed Notice of Transfer of Oil and Gas
Wells-Form 15 (“Notice of Transfer”) that would
allow the purchasers to operate the two wells and realize
upon the benefit of what they had purchased. As detailed in
the court's findings and conclusions and as discussed
further below, the sales agreement was consummated in June
2012, and an acceptable Notice of Transfer was not filed by
the Azars until February 2016 - shortly after the court
granted partial summary judgment in which it held that the
Azars were in breach for not having completed and filed the
required Notice of Transfer. With respect to this claim, the
court awarded damages in the amount of $89, 905.48 - far less
than approximately $1.2 million that Leland Oil requested at
the conclusion of the trial.
second claim in the case had to do with an obligation
undertaken as part of the agreement for the purchase of the
Davis State and Sullivan wells by Leland Oil and Bensun
Energy, which was that they had agreed to do rehabilitative
work, at the Azars' expense, on another well owned by the
Azars - the McMahen State. To fulfill that obligation, Leland
Oil had K and R Roustabout, an affiliated company, do the
work, but the Azars failed to pay for it. At the commencement
of the trial, K and R Roustabout and the Azars stipulated to
the entry of judgment on that claim in favor of K and R
Roustabout in the amount of $19, 552.80. (Doc. No. 66, pp.
5-6). In fact, Saul Azar presented a confession of judgement
that he had signed for that amount. (Id.; Ex. D2).
relevant background is set forth in the court's findings,
conclusions, and order for judgment. (Doc. No. 75);
Leland Oil & Gas, LLC, v. Marsha Azar and Saul Azar
dba Illinois Energy, Case No. 1:14-cv-161, 2017 WL
752142 (D.N.D. Feb. 2, 2017) (“Leland
LAW GOVERNING RULE 60(b)(6) MOTIONS
Civ. P. 60(b) provides an opportunity for a disappointed
litigant to seek relief from a final order or judgment by
invoking one of six enumerated grounds. Here, the Azars rely
upon the sixth “catch all” ground, which, in
pertinent part, provides:
On motion and just terms, the court may relieve a party or
its legal representative from a final judgment, order, or
proceeding for . . . any other reason that justifies relief.
prevail on a Rule 60(b)(6) motion, a movant is required to
demonstrate the existence of “extraordinary
circumstances.” E.g., Gonzalez v.
Crosby, 545 U.S. 524, 535 (2005); Ackermann v.
United States, 340 U.S. 193, 199 (1950); United
States v Young, 806 F.2d 805, 806 (8th Cir. 1986). The
reason for this extremely high burden is to promote the
finality of judgments. Id.; see also City of
Duluth v. Fond du Lac Band of Lake Superior Chippewa,
702 F.3d 1147, 1155 (8th Cir. 2013) (Rule 60(b)(6) is an
“extraordinary remedy for exceptional
circumstances.”). It is also in part for this reason
that Rule 60(b)(6) cannot be used as a substitute for an
appeal or the exercise of other available legal remedies.
E.g., In re Zimmerman, 869 F.2d 1126, 1128
(8th Cir. 1989) (“[Rule 60(b)(6)] is not a substitute
for other legal remedies. Such relief is to be granted only
when exceptional circumstances prevented the moving party
from seeking redress through the usual channels.”);
Young, 806 F.2d at 806 (“Rule 60(b) is not
available as a substitute for appeal.”).
Azars contend the court should set aside its judgment in this
case for two reasons. First, they contend that their trial
counsel was grossly negligent and abandoned them
“pretrial.” Second, they argue that the court
procedurally erred when it granted partial summary judgment
in favor of Leland Oil.
Attorney gross negligence/abandonment
Azars claim that their trial counsel's purported gross
negligence and abandonment of them “pretrial”
constitutes extraordinary circumstances thereby entitling
them to relief pursuant to Rule 60(b)(6). The court disagrees
for two reasons - either of which is sufficient to deny the
motion. First, the court does not believe that the particular
circumstances of this case arise to the level of
extraordinary circumstances such as would justify relief
pursuant to Rule 60(b)(6). Second, the Azars have failed to
demonstrate even a reasonable probability that the claimed
deficiencies would likely have changed the result.
The claims of attorney misconduct when considered against the