Cradduck v. Financial Indem. Co.

• Decision Date: 17 June 1966
• Citation: 242 Cal.App.2d 850,52 Cal.Rptr. 90
• Court: California Court of Appeals Court of Appeals
• Parties: Clara M. CRADDUCK, Plaintiff and Respondent, v. FINANCIAL INDEMNITY COMPANY, Defendant and Appellant. Civ. 11177.

Page 90

52 Cal.Rptr. 90

242 Cal.App.2d 850

Clara M. CRADDUCK, Plaintiff and Respondent, v. FINANCIAL INDEMNITY COMPANY, Defendant and Appellant.

Civ. 11177.

District Court of Appeal, Third District,

California.

June 17, 1966.

Hearing Denied Aug. 24, 1966.

Robert M. Cole, Davis, for appellant.

Burt Lancaster, Sacramento, for respondent.

PIERCE, Presiding Justice.

This is an appeal from a judgment following a jury verdict for plaintiff in the sum of $11,153.60 against defendant Financial Indemnity Company ('Financial'). The appeal is on a clerk's transcript augmented by the judgment roll in the original action. Financial had insured one Cervantes under a public liability policy. Plaintiff had obtained a default judgment against Cervantes for personal injuries suffered in an automobile accident. The judgment was obtained after publication of summons pursuant to an order therefor.

In the case at bench defendant's attack, which is against the judgment in the original action, is collateral. Against such an attack we hold the judgment must be affirmed. Our reasons will be developed below.

Publication of summons in the original action was based upon the affidavit of Burt Lancaster, one of plaintiff's attorneys. It alleged, inter alia, that a complaint had been filed and a summons issued January 31, 1961, and that the complaint and summons had been placed in the hands of William Lowe, a private investigator, for service upon Frank Cervantes, the defendant. It alleged that Lowe had made diligent efforts to serve Cervantes and enumerated these efforts which included a visit to his place of employment, where it was ascertained that Cervantes had left his employment. (Lowe was told there that Cervantes had 'departed for the State of Oregon.') Cervantes' mother had been visited and from her it had been learned that she did not know his whereabouts. The investigator had talked with Cervantes' wife. From her he ascertained that Cervantes had absented himself from Sacramento County for the reason that he was being sought 'by Sacramento County officials for the purpose of enforcing payment for support of said Defendant's minor child.' Lowe had then visited the sheriff's office in Sacramento and had confirmed this information. Deputies of that office were searching for Cervantes and had a warrant for his arrest but had been unable to ascertain his whereabouts. From the California Department of Motor Vehicles the investigator learned that said defendant had 'no residence address listed, only a post office address.' Information had next been sought from the Sheriff of Contra Costa County, where it was 'learned that Defendant FRANK CERVANTES had been released from custody' and his whereabouts was also unknown to him. From these facts Lancaster, the affiant, drew the conclusions 'that your affiant believes and thereon alleges that Defendant FRANK CERVANTES is secreting himself to avoid the service of process and that he left the State of California.' In our opinion the latter conclusion was unjustified by the facts ascertained. It is at least inferable, however, against collateral attack that the first assumption was correct. From the verified complaint it appeared that at the time of the accident Cervantes was driving an automobile with a California license number (BRV-867).

The order for publication of summons recites that it is made on the basis of the verified complaint, the foregoing affidavit 'and from other evidence.' It also recites that 'diligent search' had been made and 'that said Defendant cannot, after due diligence, be found within the State of California.' It orders service of summons by publication.

To complete the statement of pertinent facts, publication was made, Cervantes' default was taken June 6, 1962, and on July 25, 1962, a default judgment was given by the court after taking evidence. This was a personal judgment for $7,500 general damages, $2,105.50 special damages and costs. It recites that Cervantes had been 'regularly served with process.' On June 7, 1962, plaintiff brought this action against Financial, alleging the unpaid judgment and Financial's liability as Cervantes' insurer. The case was tried to a jury which on November 2, 1964, in addition to its general verdict in plaintiff's favor brought in a special verdict as follows: 'Did Cervantes breach the cooperation clause and thereby substantially prejudice the defendant Financial

Indemnity Company? Answer: (Yes or NO) NO.' Re The Contention the Original Judgment Violated Code of Civil Procedure Section 417. ¹

The first and principal contention on appeal is that the provisions of the captioned code section, which provides that a personal judgment can be obtained only by personal service of a copy of the summons and complaint upon the defendant, were not complied with. But Code of Civil Procedure section 417 applies only to 'a person who is outside of' the State of California. Here the facts hereinabove related show it is not known where Cervantes, the defendant in the original action, is--whether he is inside or outside the state. Obviously the section presupposes a defendant whose whereabouts outside the State of California are known--one who can be reached in another state for personal service of summons. Although plaintiff's attorney in his affidavit had drawn the conclusion that Cervantes was outside the State of California, that conclusion was based solely upon the fact that someone at the place of Cervantes former employment had told Lowe, the investigator, he had departed for Oregon. This constituted no more than a statement from Lowe's informant that Cervantes, when he quit his job, had told the informant (or someone else who told the informant) that he, Cervantes, was going to Oregon. Considering the circumstances of his departure, this statement by Cervantes, if he made it, was as likely as not to be one calculated to throw the sheriff's officers seeking him 'off the scent' of his true destination. Section 417 therefore has

no application here. Re The Contention that Hearsay Allegations are Insufficient to Support a Default Judgment.

Publication of summons in the original action was under Code of Civil Procedure sections 412--413. The provisions of section 412, insofar as they are applicable to this proceeding, provide that the judge may make an order that service of summons against an individual defendant be made by publication when any of the following conditions exist: (1) such defendant resides out of the state, or (2) has departed from the state, or (3) cannot with due diligence be found within the state, or (4) conceals himself to avoid service of summons. A provision of section 413 applicable to our inquiry in the instant case is: 'In case of publication, where the residence of a nonresident or absent defendant is known, the court, judge, or justice, must direct a copy of the summons and complaint to be forthwith deposited in the post office, directed to the person to be served, at his place of residence'

The facts alleged in Mr. Lancaster's affidavit, as outlined above, are hearsay. Financial urges this as establishing that the order for publication of summons, default and default judgment following it are void. Cited to support that argument are Miller v. Superior Court, 195 Cal.App.2d 779, 784, 16 Cal.Rptr. 36, and Kahn v. Matthai, 115 Cal. 689, 47 P. 698. Both of those actions were on direct attack from the default judgment. ² But the action in which this appeal is taken is a collateral attack. '* * * In an action upon a judgment the judgment sued on may not be attacked except in accordance with the rules and principles governing collateral attack.' (Ligare v. California Southern R.R. Co., 76 Cal. 610, 613, 18 P. 777; Kirkpatrick v. Harvey, 51 Cal.App.2d 170, 172, 124 P.2d 367, 368; and see generally 3 Witkin, Cal.Procedure, pp. 2044, 2045, and cases cited.) One of the rules governing collateral attack is that hearsay in the affidavit for publication of summons may be considered and supports the judgment thereafter made.

In Thompson v. Thompson, 226 U.S. 551, 556, 33 S.Ct. 129, 57 L.Ed. 347, a Virginia

decree was attacked upon the ground that the affidavit used as the basis for an order of publication was made on information and belief and not on personal knowledge. The court said at page 566, 33 S.Ct. at page 133: '(I)t seems well settled that where the affidavit used as the basis for an order of publication is defective, not in omitting to state a material fact, but in the mode of stating it or in the degree of proof, the resulting judgment, even though erroneous and therefore voidable by direct attack, cannot be said to be Coram non judice and therefore void on its face.' In Pennoyer v. Neff, 95 U.S. 714, 721, 24 L.Ed. 565, it was said that defects in an affidavit can only be taken advantage of in a direct proceeding.

Several California cases hold that in a collateral proceeding the hearsay nature of facts stated in an affidavit considered by a judge in determining that the affiant used due diligence to effect service does not render the judgment void. (Rue v. Quinn, 137 Cal. 651, 656--657, 66 P. 216, 70 P. 732; Ligare v. California Southern R.R. Co., supra, 76 Cal. 610, 18 P. 777; see also Davis-Heller-Pearce Co. v. Ramont, 66 Cal.App. 778, 226 P. 972; Butler v. McKey, 9 Cir., 138 F.2d 373.) In Rue v. Quinn, supra, the court made an observation which should be stressed. It stated (137 Cal. on p. 657, 66 P.2d on p. 217): '* * * From the nature of the question to be determined, the evidence thereon must, to a very great extent, be hearsay * * *.' Diligence is exercised by a plaintiff by inquiries made from many sources. It is the sum of the information obtained at each of these sources which will make it possible for the judge to determine whether an order for publication of summons should issue. To require a separate affidavit from each source would be both cumbersome and unnecessary. We hold that...