Summary
In Davis the Court reversed the refusal to set aside the default, noting that the defendant "believed in good faith that no further action would be taken in the case without notice to him.
Summary of this case from Reeves v. WisenorOpinion
No. 8542.
February 5, 1958.
APPEAL FROM DISTRICT COURT, FOURTH JUDICIAL DISTRICT, LINCOLN COUNTY, D.H. SUTPHEN, J.
Murphy Schwartz, Shoshone, for appellant.
H.N. Jewell, Twin Falls, for respondent.
The court may relieve a party from a judgment, order or other proceedings taken against him through inadvertence, surprise or excusable neglect. I.C. § 5-905.
The object of statutes and rules regulating procedure in the courts is to promote the administration of justice. Stoner v. Turner, 73 Idaho 117, 247 P.2d 469.
Judgments by default are not favored by the courts, and the general rule inclines toward granting relief from defaults to bring about a judgment on the merits. Orange Transportation Co. v. Taylor, 71 Idaho 275, 230 P.2d 689.
If mistake is urged as one of the grounds in support of a motion to vacate a default decree, the mistake must be one of fact and not of law. Thomas v. Stevens, 78 Idaho 266, 300 P.2d 811.
Clerk may not enter a default judgment except as she is authorized by statute to do so, and then only in cases authorized by statute and in strict conformity with the provisions of the statute. Gustin v. Byam, 41 Idaho 538, 240 P. 600; 49 C.J.S. Judgments, § 204, p. 364.
This Court has held that the mistake, inadvertence or excusable neglect contemplated by the statute is such as might be expected on the part of a reasonably prudent person under the circumstances, and that the statute does not excuse utter indifference and inattention to business. In an unbroken line of decisions, this Court has held that the question of whether the mistake, inadvertence or neglect is excusable is addressed in the first instance to the sound discretion of the Trial Court, and its judgment in the matter will not be reversed except for manifest abuse. Atwood v. Northern Pac. Railway Co., 1923, 37 Idaho 554, 217 P. 600; Neilson v. Garrett, 1935, 55 Idaho 240, 43 P.2d 380; Voellmeck v. Northwestern M.L. Ins. Co., 1939, 60 Idaho 412, 92 P.2d 1076; Orange Transp. v. Taylor, 1951, 71 Idaho 275, 230 P.2d 689.
Jurisdiction to enter a judgment against a defaulting defendant rests upon the fact of service of process, and as a general rule, a judgment by default may be taken only where it appears that process has been duly served upon the defendant. Under this rule, the return of service is regarded merely as the evidence of the jurisdictional fact of service, and it has, accordingly, been held that to support a judgment by default, record proof of the service of process may be amended or supplied, not for the purpose of authorizing the entry of a new judgment, but to show that the judgment previously entered was not entered without jurisdiction. 31 Am.Jur. Judgments, 129-130; Call v. Rocky Mountain Bell Tel. Co., 16 Idaho 551, 102 P. 146.
There is authority for the view that a faulty or defective return or proof of service, or even complete absence of return or proof of service does not of itself render a default judgment void if due service was had, since it is fact of service, and not the return of service or proof thereof that gives the Court jurisdiction. 49 C.J.S. Judgment § 192, p. 335.
Respondent filed his complaint May 25, 1955, in the District Court for Lincoln County, praying for judgment against appellant in the sum of $967.77 together with interest, as balance due on account for goods, wares and merchandise sold and delivered to appellant during the year 1948. Within 20 days thereafter, appellant contacted H.N. Jewell, the attorney for respondent. Appellant advised such attorney that the gasoline and other merchandise in question had been purchased by appellant and three other men, and that each was to pay for his share of such merchandise. He further advised such attorney that respondent was aware of such arrangement and furnished the merchandise in accordance with same. And that appellant had paid his share of the account to respondent and had been released by respondent from further liability.
Appellant and the attorney for respondent agreed to make an endeavor to collect the balance due from the other three men involved either in cash or by promissory notes. In pursuance of such arrangement promissory notes were prepared by such attorney. One of the debtors offered to pay his share of the balance of the account upon condition that he be relieved from further liability, but such payment was refused by respondent. It was understood between appellant and the attorney for respondent that no further proceedings in the action would be had pending the attempted settlement.
Settlement not having been made by the other three debtors, the attorney for respondent on October 5, 1955, wrote a letter to appellant, reading as follows:
"Mr. Wayne Rathbun,
"Dietrich, Idaho
"Dear Mr. Rathbun:
"We have delayed taking any further action in regard to the suit against you by Gene Davis on our understanding that it might be possible for some settlement to be worked out between the parties. However, we have recently contacted Mr. Davis and have been informed that no settlement is in the off ering and that the situation has not changed during recent weeks.
"Therefore, this letter is to advise that on October 17, 1955 we will ask the District Court of Lincoln County to set the case for hearing as soon as possible. If you desire to contact this office prior to that time and arrange some method of payment of this suit, we would be glad to discuss the matter with you.
"Yours very truly,
"H.N. Jewell."
Appellant, at the hearing on the hereinafter mentioned motion to set aside default, testified he had no recollection of receiving such letter. However, if he be mistaken there is nothing in this letter to indicate that a default was about to be taken against him.
The proposed settlement being still pending and without further notice of any kind to appellant, respondent on June 23, 1956, had a default and a default judgment entered against appellant by the Clerk of the District Court of Lincoln County. When appellant learned of the default judgment, he promptly on August 18, 1956, filed a motion to set aside said default and vacate said default judgment upon the ground of mistake, inadvertence and excusable neglect under the provisions of Section 5-905, I.C. Accompanying said motion to set aside the default and default judgment, appellant filed an affidavit and an answer showing a meritorious defense.
Thereafter, hearing was held upon the motion to set aside the default and vacate the default judgment. The court entered an order denying the motion to set aside the default and vacate the default judgment. From such order appellant has appealed to this court.
In determining whether or not a motion to set aside a default should be granted, each case must be examined and considered in the light of the facts presented and the circumstances surrounding the case. In doubtful cases the general rule is to incline toward granting relief in order to bring about judgment on the merits. Orange Transportation Co. v. Taylor, 71 Idaho 275, 230 P.2d 689.
The purpose of Section 5-905, I.C., is to provide a means of relieving a litigant from the harsh consequences of a strict application of the time requirement. Stoner v. Turner, 73 Idaho 117, 247 P.2d 469. It should appear that a defaulting party seeking relief has not been guilty of indifference or unreasonable delay and that he has acted promptly and diligently in seeking relief, and that the other party is not unduly prejudiced or deprived of any advantage to which he may be properly entitled. Stoner v. Turner, supra.
We have recently reviewed in detail the rules which should guide the court in determining whether or not a default should be set aside for excusable neglect in Johnson v. Noland, 78 Idaho 642, 308 P.2d 588. See also, Perry v. Perkins, 73 Idaho 4, 245 P.2d 405 and Mead v. Citizen's Automobile Inter-Insurance Exchange, 78 Idaho 63, 297 P.2d 1042.
At the hearing on the motion to set aside the default and vacate the default judgment appellant brought himself well within the foregoing rules entitling him to relief on the ground of excusable neglect. Under the circumstances, he was justified in believing that no further action would be taken against him pending the outcome of the negotiations for settlement by the other debtors. He believed in good faith that no further action would be taken in the case without notice to him. He did not delay when the default judgment was taken but acted promptly to have the same set aside.
The account in question was old at the time of the commencement of this action. There is no showing whatever that the respondent was prejudiced in his rights in any way be the delay or deprived of any advantage to which he was properly entitled. Under the facts in the case it was error for the trial court to refuse to set aside the default and vacate the default judgment.
Our conclusion that the default should be set aside and the default judgment vacated on the ground of excusable neglect makes it unnecessary for us to discuss the questions raised as to the jurisdiction of the clerk of the court to enter the default or to enter the default judgment.
The order of the trial court denying the motion of appellant to set aside the default and vacate the default judgment is reversed and the cause remanded with instructions to set aside the default and vacate the default judgment and to proceed further in the premises. Costs awarded to appellant.
KEETON, C.J., and TAYLOR, SMITH and McQUADE, JJ., concur.