Five Star Steel Contractors, Inc. v. Colonial Credit Union, A93A0773

• Decision Date: 24 May 1993
• Docket Number: No. A93A0773,A93A0773
• Citation: 431 S.E.2d 712,208 Ga.App. 694
• Parties: FIVE STAR STEEL CONTRACTORS, INC. v. COLONIAL CREDIT UNION.
• Court: Georgia Court of Appeals

Page 712

431 S.E.2d 712

208 Ga.App. 694

FIVE STAR STEEL CONTRACTORS, INC. v. COLONIAL CREDIT UNION.

No. A93A0773.

Court of Appeals of Georgia.

May 24, 1993.

Porter & Doster, Sidney R. Barrett, Jr., for appellant.

Ronald W. Parnell, for appellee.

BEASLEY, Presiding Judge.

We granted this discretionary appeal to resolve an issue of first impression: whether a garnishee's failure to accept certified mail notification that a default judgment has been entered against it satisfies the requirement of "actual notice" in OCGA § 18-4-91 so as to commence the running of the 60-day period during which, upon payment of accrued costs, a garnishee may move to modify the default judgment. We hold that it does and affirm the judgment below.

Colonial Credit Union obtained judgment against Jackie Sneed in the amount of $5,424.71. Colonial believed Five Star Steel Contractors, Inc. to be Sneed's employer, and summons of garnishment was personally served on Five Star. Sneed's employment with Five Star, however, had terminated several weeks prior to the service of the summons. Mistakenly believing there was no need to answer since it did not owe Sneed any money, Five Star ignored the summons. Default judgment was entered against Five Star on January 6, 1992.

In January 1992, Colonial mailed a copy of the default judgment to Five Star via certified mail return receipt requested. A certified mail envelope postmarked January 24, 1992, indicates that it was sent by Colonial's attorney on that date to Five Star at its correct address and that no postage was due. After several attempts at delivery, the envelope was returned "unclaimed" in February 1992. In July 1992 Colonial obtained a fi. fa. Postjudgment interrogatories were personally served on Five Star on September 1, 1992.

Five Star's motion for reduction of the amount of the default judgment pursuant to OCGA § 18-4-91 was filed on September 18, 1992, and accrued costs were paid. In that motion and the accompanying affidavit of its president, Five Star alleged that it first learned of the default judgment on September 1, 1992. The court denied the motion as untimely, i.e., outside the 60-day period within which such motions may be filed, finding that Five Star had received notice when it refused to accept the certified mail in February.

OCGA § 18-4-91 allows a defaulting garnishee to move "not later than 60 days from the date [it] receives actual notice of the entry of the judgment against him, ... upon payment of all accrued costs of court, [to] have the judgment modified so that the amount of the judgment shall be reduced to an amount equal to the greater of $50.00 or $50.00 plus 100 percent of the amount by which the garnishee was indebted to the defendant from the time of service of the summons of garnishment through and including the last day on which a timely answer could have been made.... Notice to the garnishee by certified mail shall be sufficient notice as required in this Code section. On the trial of the motion, the burden of proof shall be upon any plaintiff who objects to the timeliness of the motion to establish that the motion was not filed within the time provided for by this Code section."

Five Star contends the court erred by denying its motion because the statute requires receipt of actual notice of the default judgment, and none was received until September 1, 1992, when the postjudgment interrogatories were personally served. It argues that although a different statute, OCGA § 18-4-64(a)(2), which governs notice to the debtor of the issuance of the summons of garnishment, provides that the debtor's refusal to accept notice sent by certified mail is deemed to satisfy the notice requirement, OCGA § 18-4-91 includes no such provision, and its absence must be construed as an indication that a garnishee's refusal of the notice does not satisfy the statute's requirement of "actual notice."

Where no proceeding is pending between the parties at the time a notice is required to be given, due process requires personal service of the notice. Henry v. Hiawassee Land Co., 246 Ga. 87, 88-89, 269 S.E.2d 2 (1980). Thus, initiation of garnishment proceedings must be accomplished with personal service of the summons of garnishment upon the garnishee. OCGA § 18-4-62(a). Default judgment may be taken against the garnishee if the garnishee fails or refuses to file an answer sixty days after having been personally served with the summons. OCGA § 18-4-90. Notice to the garnishee by certified mail of the entry of a default judgment is "sufficient notice as required in this Code section." OCGA § 18-4-91.

Having been personally served at the outset of the proceeding, and default judgment having been entered only by virtue of the garnishee's failure or refusal to respond in appropriate fashion, this provision does not offend the requirement of due process.

In some instances, particular statutes or contracts mandating notice are not complied with unless or until the notice is actually received. See, e.g., Hamilton v. Edwards, 245 Ga. 810, 267 S.E.2d 246 (1980) (notice of change in tax assessment); Menke v. First Nat. Bank, 168 Ga.App. 495, 498-500(1), 309 S.E.2d 835 (1983) (...