Minnesota's Test for Vacating a Default Judgment Is Not in Rule 60.02. It Has Four Parts, and You Have to Prove All Four.

A default judgment feels final in a way other judgments do not. Nobody argued. Nothing was decided on the merits. The number was set by an affidavit and a hearing the defendant never attended, and by the time it surfaces it is usually attached to a garnishment.

It is not final. Minnesota district courts vacate default judgments regularly, under a standard the Supreme Court has described as reflecting “a liberal policy conducive to the trial of causes on their merits.”

But there is a structural trap in how that standard is usually explained. Read Rule 60.02 and you will not find the four-factor test. The rule lists six grounds and two time limits and says nothing about four factors at all. The test comes from a 1952 opinion construing a statute that has since been repealed — and in 2016 the Minnesota Supreme Court confirmed that the movant must affirmatively establish every one of the four, with express district court findings on each.

That last point is where motions die. Most are briefed as if three factors belong to the movant and the fourth belongs to the opposing party.

What does Rule 60.02 actually say?

Minn. R. Civ. P. 60.02, in relevant part:

On motion and upon such terms as are just, the court may relieve a party or the party’s legal representatives from a final judgment (other than a marriage dissolution decree), order, or proceeding and may order a new trial or grant such other relief as may be just for the following reasons:

(a) Mistake, inadvertence, surprise, or excusable neglect;

(b) Newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial pursuant to Rule 59.03;

(c) Fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party;

(d) The judgment is void;

(e) The judgment has been satisfied, released, or discharged or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or

(f) Any other reason justifying relief from the operation of the judgment.

The motion shall be made within a reasonable time, and for reasons (a), (b), and (c) not more than one year after the judgment, order, or proceeding was entered or taken. A Rule 60.02 motion does not affect the finality of a judgment or suspend its operation. This rule does not limit the power of a court to entertain an independent action to relieve a party from a judgment, order, or proceeding, or to grant relief to a defendant not actually personally notified as provided in Rule 4.043, or to set aside a judgment for fraud upon the court. …

Three things in that text do more work than the six lettered grounds. “Upon such terms as are just” makes relief conditional by design — the court can grant it on terms, which matters enormously to the fourth factor below. The one-year limit reaches only (a), (b), and (c); clauses (d), (e), and (f) remain subject to the “reasonable time” requirement, which is not the same as no limit. And a Rule 60.02 motion “does not affect the finality of a judgment or suspend its operation” — filing stays nothing and tolls nothing, so the garnishment continues while the motion is pending unless separate relief is obtained.

Where does the four-factor test come from, if not the rule?

From Hinz v. Northland Milk & Ice Cream Co., 237 Minn. 28 (1952) — a case about a dead Chesapeake dog, a $250 judgment, and an insurer that mislaid the summons.

Hinz was decided not under Rule 60.02 but under Minn. Stat. § 544.32, which let a court relieve a party “from any judgment, order, or other proceeding taken against him through his mistake, inadvertence, surprise, or excusable neglect.” That statute no longer exists; the 1949 version was repealed by 1974 Minn. Laws ch. 394, § 12. The test outlived it. As Hinz framed it:

[I]t is the duty of the trial court, in furthering justice by adopting a liberal policy conducive to the trial of causes on their merits, to grant a motion to open a default judgment and permit a party to answer, if the party in default shows that he (a) is possessed of a reasonable defense on the merits, (b) has a reasonable excuse for his failure or neglect to answer, (c) has acted with due diligence after notice of the entry of judgment, and (d) that no substantial prejudice will result to the other party.

Finden v. Klaas, 268 Minn. 268, 128 N.W.2d 748 (1964), carried that formulation into Rule 60.02 and is the citation everyone uses. The Supreme Court has called them both the “Finden factors” and the “Hinz factors”; they are the same four.

Finden shows how far the liberality runs. The defendant hired a lawyer who never answered, never responded to the note of issue, and never acted on a letter announcing that the case would be taken as a default. The Court agreed the district court “had no choice but to conclude that such neglect was inexcusable” and that “[u]nder basic principles of agency, such neglect was chargeable to defendant” — then reversed the denial of relief anyway, because the defendant personally had entrusted the matter to counsel and had a complete defense to plead.

Do I really have to win all four?

Yes. This was contested and is now settled.

In Gams v. Houghton, 884 N.W.2d 611 (Minn. 2016), the court of appeals had held that a party seeking Rule 60.02 relief “need not categorically establish all four” factors. The Supreme Court rejected that as “not consistent with our precedent,” holding that a district court must consider, and expressly find that the movant satisfied, all four — and remanded because the district court’s bare statement that the movant “did not prove all four” elements, without findings, made appellate review impossible. The affirmative-burden language is older: in Pedersen v. Daly, 307 Minn. 163, 238 N.W.2d 620 (1976), after quoting the Hinz factors, the Court wrote flatly that the movant “is obliged to affirmatively establish all of the above.”

There is a mirror-image holding that movants underuse. In Charson v. Temple Israel, 419 N.W.2d 488 (Minn. 1988), the Court held that where the movant “has met the burden of clearly demonstrating the existence of the four elements of the Finden analysis,” the district court abused its discretion in denying relief. Gams reaffirmed it: discretion under Rule 60.02 is broad, but “it does not have unfettered discretion to deny relief when the movant has met his burden of establishing all four Finden requirements.”

So the four factors cut both ways. They are a complete checklist the movant must satisfy — and, satisfied, they are close to mandatory.

Which factor loses the motion?

The fourth: that no substantial prejudice will result to the other party.

It is the movant’s burden, and it is the one most often left to a sentence. That is backwards, because it is the factor with the most usable case law and the one the movant can actually engineer.

Finden is the template. The plaintiffs there argued prejudice; the Court’s response was that “prejudice is always inherent when the trial of a case is delayed,” that the opposing affidavit claimed none “except delay and the added expense incurred by reason of the default proceedings,” and that the prejudice asserted on appeal “does not appear to be different except in degree, coupled with the inconvenience and distress understandably caused by an adversary who changes his position from an attitude of conciliation and negotiation to an attitude of resistance.” Delay and the cost of the default proceedings, standing alone, were not substantial prejudice.

Then Finden explained the fix, and this is the part motions skip. Because Rule 60.02 grants relief “upon such terms as are just,” the district court could have conditioned vacatur on payment of “costs and disbursements, including a reasonable attorney’s fee” — and, on a suggestion that the defendant had transferred title to some of his property to escape the judgment, “is empowered under the rule to impose further conditions requiring defendant either to deposit security for the payment of any judgment plaintiffs may obtain or to effect a restoration of his financial ability to respond in damages.”

A motion that proposes those terms is arguing the fourth factor. A motion that asserts “plaintiff will suffer no prejudice” and stops has not engaged it. In Charson, the opposing party “neither claims, nor sustained, prejudice other than delay, which, in and of itself, constitutes an insufficient showing of prejudice.” In Nguyen v. State Farm Mutual Automobile Insurance Co., 558 N.W.2d 487 (Minn. 1997), the Court observed that “only the ‘reasonable excuse’ factor is at issue,” because prejudice, diligence, and merits were not seriously contested.

Prejudice is winnable — when it is briefed.

Is my lawyer’s neglect charged to me?

Formally yes, practically often not.

Finden applied agency principles to charge counsel’s neglect to the client, then scrutinized the client’s own conduct separately and granted relief. Charson stated the working rule: “even in those cases where a court has held the neglect of a client’s attorney to be inexcusable, if such neglect has been purely that of counsel, ordinarily courts are loath to ‘punish’ the innocent client for the counsel’s neglect.”

Nguyen applied it to a defendant whose counsel “instructed his legal assistant to file a Request for Trial De Novo” and whose legal assistant “failed to file the original with the court.” The Supreme Court held State Farm was “an innocent client” that “has met the four-prong Finden standard,” and vacated the judgment.

The evidentiary consequence is specific: the record has to separate what the client did from what counsel did. Hinz says the required showing “may in certain instances be made upon a verified answer alone as supplemented by the entire file,” but may also be “fortified by, or made solely on an affidavit executed by defendant or by some other person, such as defendant’s attorney, who is possessed of a personal knowledge of the facts.” An affidavit from counsel is competent — if it establishes personal knowledge.

How long do I have?

It depends entirely on which clause you are under.

Most default-judgment motions are (a) motions, so most are one-year motions, running from entry of the judgment or order — not from the date the defendant found out.

The absence of a one-year cap on clause (d) is not the same as no clock. Federal practice under the parallel Rule 60(b)(4) made that concrete this year, and we wrote about it separately: the “reasonable time” requirement means what it says even for a judgment attacked as void. Minnesota’s rule carries the identical structure.

Three other routes are preserved by the rule’s own savings clause, and each runs on its own clock rather than Rule 60.02’s.

Service by publication. Minn. R. Civ. P. 4.043 provides that where the summons was served by publication and “the defendant receives no actual notification of the action,” the defendant may be permitted to defend before judgment for sufficient cause and, except in a dissolution, “may be permitted to defend at any time within one year after judgment, on such terms as may be just.” If part of the judgment has been enforced and the defense is sustained, “such restitution shall be made as the court may direct.”

Judgments procured by fraud. Minn. Stat. § 548.14 allows a judgment obtained “by means of perjury, subornation of perjury, or any fraudulent act, practice, or representation of the prevailing party” to be set aside in an action brought for that purpose “in the same judicial district within three years after the discovery by the aggrieved party of such perjury or fraud.” That is an independent action, not a motion, and it runs from discovery — one of Minnesota’s deadlines that starts on a contested fact rather than a date.

Fraud upon the court. Rule 60.02 expressly does not limit the court’s power to set a judgment aside on that ground.

Before you argue the four factors — was the default properly entered at all?

Sometimes the better motion is the simpler one.

Rule 55.01 splits defaults in two. Under Rule 55.01(a), where the claim “is upon a contract for the payment of money only,” or for taxes, penalties, and interest owed the state, the court administrator enters judgment on the plaintiff’s request and an affidavit of the amount due — an amount “which may not exceed the amount demanded in the complaint or in a written notice served on the defendant in accordance with Rule 4 if the complaint seeks an unspecified amount pursuant to Rule 8.01.” No hearing, no judge.

Under Rule 55.01(b), in all other cases the plaintiff must apply to the court — and:

If a party against whom judgment is sought has appeared in the action, that party shall be served with written notice of the application for judgment at least 14 days prior to the hearing on such application.

The definition of “appeared” is broader than most people assume. Rule 5.01: “A party appears when that party serves or files any document in the proceeding.” Not an answer. Any document. A defendant who served something and then stopped participating may well have been entitled to fourteen days’ written notice of the default application.

Rule 55.01(d) adds a further protection where the summons was served by published notice or by delivery outside Minnesota: default judgment “must not be entered until the plaintiff, if required by the court, has filed a court-approved bond” conforming to a court order about restitution of property obtained from the judgment if a defense is later permitted and sustained — with an exception for actions involving title to real estate or foreclosure of mortgages or other liens.

Each of these is a defect in the entry of the judgment rather than an excuse for the default, and they are worth checking first. (A default that arose in conciliation court travels a different procedural path and should be evaluated on that track.)

One large exception: divorce decrees

Rule 60.02 relieves a party from “a final judgment (other than a marriage dissolution decree).” Dissolution has its own statute.

Minn. Stat. § 518.145, subd. 2, lets the court reopen a judgment and decree, order, or proceeding under chapter 518 — “except for provisions dissolving the bonds of marriage, annulling the marriage, or directing that the parties are legally separated” — for five reasons: mistake, inadvertence, surprise, or excusable neglect; newly discovered evidence; fraud, misrepresentation, or other misconduct of an adverse party; the judgment is void; or the judgment has been satisfied, released, or discharged, a prior judgment has been reversed or vacated, or it is no longer equitable that it have prospective application.

Count them. There are five, not six. The catch-all — “any other reason justifying relief” — does not appear in the statute. The one-year limit for the first three grounds, the “reasonable time” requirement, the no-suspension-of-the-judgment language, and the savings clause for independent actions all track Rule 60.02, but the residual clause is simply absent from chapter 518.

The practical order of operations

1. Date the judgment. The one-year limit for clauses (a), (b), and (c) runs from when the judgment, order, or proceeding “was entered or taken,” not from discovery.
2. Test the entry before the excuse. Rule 55.01(a) versus (b), whether a Rule 5.01 appearance occurred, whether the 14-day notice was served, whether Rule 55.01(d) applied.
3. Move now, and document when you learned. Factor (c) is diligence after notice of entry.
4. Plead the defense with facts. Factor (a) requires a defense on the merits, supported by a proposed answer, a verified pleading, or an affidavit on personal knowledge.
5. Separate client conduct from counsel conduct in the affidavits. That is what makes the Charson and Nguyen line available.
6. Brief prejudice as your burden, and offer terms — costs, fees, security — because Rule 60.02 grants relief “upon such terms as are just” and Finden says the court may impose exactly those conditions.
7. Do not assume the motion buys time. It does not suspend the judgment’s operation.

Madgett Law, LLC represents clients in Minnesota district court civil litigation, including motions to vacate default judgments and to challenge judgments entered without proper notice or service. That work starts with the entry itself — how the default was taken, whether an appearance occurred, and which Rule 60.02 clause and clock actually apply — before it reaches the four-factor showing. To discuss a Minnesota judgment, Send us a message or call 612-470-6529.

Sources: Minn. R. Civ. P. 60.02 (grounds (a)–(f); “upon such terms as are just”; one-year limit applies only to reasons (a), (b), and (c); motion does not affect finality or suspend operation; savings clause for independent actions, Rule 4.043 relief, and fraud upon the court; exclusion of marriage dissolution decrees); Minn. R. Civ. P. 55.01(a) (court administrator entry on a contract for the payment of money only; amount may not exceed the amount demanded), 55.01(b) (application to the court; 14 days’ written notice to a party who has appeared), 55.01(d) (bond where service was by published notice or delivery outside Minnesota; real estate and foreclosure exception); Minn. R. Civ. P. 5.01 (“A party appears when that party serves or files any document in the proceeding”); Minn. R. Civ. P. 4.043 (service by publication; defense permitted within one year after judgment; restitution). Minn. Stat. § 548.14 (independent action to set aside a judgment procured by perjury or fraud, within three years after discovery); Minn. Stat. § 518.145, subd. 2 (reopening a dissolution judgment; five enumerated grounds with no residual clause; one-year limit for clauses (1)–(3)); Minn. Stat. § 544.32 (MS 1949) (the excusable-neglect statute construed in Hinz; repealed by 1974 Minn. Laws ch. 394, § 12). Case law: Hinz v. Northland Milk & Ice Cream Co., 237 Minn. 28 (1952) (origin of the four factors; showing may rest on a verified answer with the file or on an affidavit of a person with personal knowledge); Finden v. Klaas, 268 Minn. 268, 128 N.W.2d 748 (1964) (four factors under Rule 60.02; attorney neglect chargeable to the client under agency principles yet relief granted; delay and the expense of default proceedings not substantial prejudice; court may condition vacatur on costs, fees, or security); Pedersen v. Daly, 307 Minn. 163, 238 N.W.2d 620 (1976) (movant “obliged to affirmatively establish all” of the factors); Charson v. Temple Israel, 419 N.W.2d 488 (Minn. 1988) (abuse of discretion to deny relief where all four elements are clearly demonstrated; courts “loath to ‘punish’ the innocent client for the counsel’s neglect”); Nguyen v. State Farm Mutual Automobile Insurance Co., 558 N.W.2d 487 (Minn. 1997) (innocent client; relief where counsel’s staff failed to file); Gams v. Houghton, 884 N.W.2d 611 (Minn. 2016) (all four Finden factors must be considered and expressly found; discretion is broad but not unfettered where the movant carries the burden). This article is general legal information about Minnesota law. It is not legal advice, it does not create an attorney–client relationship, and it does not promise or imply any particular outcome.