District Court, St. George Department The Honorable Eric A.
Ludlow No. 120500402
Charles A. Schultz, Attorney for Appellant
W. Keith and Elijah L. Milne, Attorneys for Appellee
Kate A. Toomey authored this Opinion, in which Judges Michele
M. Christiansen and Ryan M. Harris concurred.
This case comes before us on an interlocutory appeal from the
district court's denial of Rodney Nelson's motion to
amend his answer to assert a compulsory counterclaim. Nelson
contends the district court abused its discretion in denying
his motion to amend because, in his view, the court "had
the obligation" to grant his motion. We disagree and
This case arises from a contract dispute between Nelson and
Reggie Lewis, who sold Nelson the right to operate a
distribution supply route. In July 2012, Lewis filed a breach
of contract action against Nelson, complaining that Nelson
missed payments under the contract. Nelson, acting pro se,
answered the complaint and raised numerous affirmative
defenses, including breach of the covenant of good faith and
fair dealing; breach of contract; and fraud, deceit, or
misrepresentation. The answer did not include any
More than three months after filing his answer, and without
first seeking leave to amend it, Nelson filed counterclaims
for fraud and violation of Utah's Business Opportunity
Disclosure Act. Because Nelson did not first seek leave to
amend his answer, Lewis filed a motion to dismiss the
counterclaims. Nelson did not file an opposing memorandum but
instead filed a belated motion to amend his answer,
explaining that, "as a pro se litigant, it has taken him
additional time to become familiar with his legal defenses,
and [he] is only now aware of his legal defenses and
counterclaims." Lewis opposed the motion, arguing that
it was untimely, that there was no justification for
Nelson's failure to include the counterclaims in his
answer, that the counterclaims would cause undue delay, and
that the counterclaims were not well pleaded. In his reply
memorandum, Nelson explained, "I thought that my answer
would serve as a counterclaim . . . . [T]here will not be any
new information or discovery needed with my counterclaim. The
same facts and documents that will be central to my defense
to [Lewis's] complaint will be used as evidence in my
During oral argument on the two motions in September 2013,
Nelson conceded that "the answer and the counterclaim
are essentially the same thing." First Judge then
announced he was granting Lewis's motion to dismiss the
counterclaims and denying Nelson's motion to amend and
remarked, "[B]ut it really doesn't impact Mr.
Nelson's defense at all." First Judge directed
Lewis's counsel to prepare the order. The order simply
stated that, "[b]ased upon the pleadings, motions,
memoranda, exhibits, and oral arguments of the parties,
" Nelson's motion to amend "should be denied
for the reasons set forth in" Lewis's opposing
memorandum, and that Nelson's counterclaims "should
be dismissed with prejudice for the reasons set forth
in" Lewis's motion to dismiss.
In January 2014, after discovery was completed, Lewis moved
for summary judgment, which First Judge orally granted during
a March hearing and which was signed by Second
Judge. Nelson eventually appealed from the order
of summary judgment,  and post-judgment execution efforts were
stayed. We reversed and remanded. See Lewis v.
Nelson, 2015 UT App 262, ¶ 17, 366 P.3d 848. In a
footnote of that opinion, we stated:
Nelson also challenges the trial court's dismissal with
prejudice of his request for leave to file a counterclaim.
This issue is not adequately briefed, and we accordingly do
not consider it on appeal. This decision on our part is
without prejudice to the prerogative of the trial court to
reconsider the dismissal in view of our reversal of the
summary judgment and our remand for further proceedings.
Id. ¶ 8 n.2 (citation omitted).
An order of remittitur issued in April 2016. On remand, the
case was reassigned to Third Judge.
In May 2016, Lewis filed a certificate of readiness for
trial. Two weeks later, Nelson filed a second motion to amend
his answer to assert several compulsory counterclaims, but he
did not attach his proposed counterclaim. Instead, in his
supporting memorandum, Nelson argued he had "a legal
right to file a counterclaim against Lewis for fraud,
fraudulent inducement, breach of covenant of good faith and
fair dealing, breach of contract, and other causes of
action." Nelson also argued that First Judge abused his
discretion in denying the first motion to amend and requested
that Third Judge so conclude. Lewis filed an opposing
memorandum, arguing the motion should be denied because
(1) Nelson has not submitted a proposed amended pleading with
this motion; (2) his counterclaim was previously dismissed
with prejudice; (3) he has not offered any excuse-let alone
any justification-for his failure to assert a claim at the
commencement of this case; (4) this lawsuit began nearly four
years ago and the parties appeared in court for trial over
two years ago; and (5) Lewis would suffer unavoidable
prejudice if Nelson were allowed to amend his pleadings at
this late stage.
attached his proposed counterclaim to his reply memorandum.
In it, he asserted claims for breach of the covenant of good
faith and fair dealing, breach of contract, ...