Gage v. Boeing Co.

• Decision Date: 07 August 1989
• Docket Number: Nos. 21673-2-,21770-4-I,s. 21673-2-
• Citation: 776 P.2d 991,55 Wn.App. 157
• Court: Washington Court of Appeals
• Parties: Gary W. GAGE, Appellant, v. The BOEING COMPANY, Respondent.

Page 157

55 Wn.App. 157

776 P.2d 991

Gary W. GAGE, Appellant, v. The BOEING COMPANY, Respondent.

Nos. 21673-2-I, 21770-4-I.

Court of Appeals of Washington,

Division 1.

Aug. 7, 1989.

Lembhard G. Howell, Seattle, for Gary W. Gage.

Heidi Sachs, Perkins, Coie, Seattle, for The Boeing Co.

SWANSON, Judge.

In this consolidated appeal, Gary W. Gage challenges orders vacating two default judgments. The orders arose from two separate industrial injury claims filed in 1981 and 1983 involving the same claimant--appellant Gage--and the same employer--respondent Boeing Company. In each case, Boeing prevailed before the Board of Industrial Insurance Appeals (the Board). Gage filed separate appeals in superior court pursuant to RCW 51.52.110. When Boeing failed to respond by filing notices of appearance as required by RCW 51.52.110, Gage sought and was granted default judgments in both cases. Gage did not notify Boeing of the default proceedings. The trial court eventually granted Boeing's motions to vacate the default judgments. Gage now appeals from the orders vacating the default judgments.

As initially framed by the parties, the primary issue on appeal was whether respondent counsel's failure to file a notice of appearance pursuant to RCW 51.52.110 constituted a "mistake" or "excusable neglect" sufficient to justify vacation of the default judgments pursuant to CR 60(b)(1). ¹ In response to a request by this court at oral argument, the parties submitted additional briefing directed to the question whether respondent was entitled to notice of the default proceedings, an issue not raised below.

Default judgments are not favored in the law. Griggs v. Averbeck Realty, Inc., 92 Wash.2d 576, 581, 599 P.2d 1289 (1979). The fundamental guiding principle

should be whether or not justice is being done. Justice will not be done if hurried defaults are allowed any more than if continuing delays are permitted. But justice might, at times, require a default or a delay. What is just and proper must be determined by the facts of each case, not by a hard and fast rule applicable to all situations regardless of the outcome.

Griggs, at 582, 599 P.2d 1289 (quoting Widicus v. Southwestern Elec. Coop., Inc., 26 Ill.App.2d 102, 109, 167 N.E.2d 799 (1960)). We will not disturb the trial court's decision on a motion to vacate absent an abuse of discretion; an abuse of discretion is less likely to be found when the trial court vacates a default judgment than when it refuses to do so. White v. Holm, 73 Wash.2d 348, 351-52, 438 P.2d 581 (1968).

The default judgments in the instant case were entered following respondent's failure to comply with RCW 51.52.110, which provides in pertinent part:

If the case is one involving a self-insurer, such self-insurer shall, within twenty days after receipt of such notice of appeal, serve and file its notice of appearance and such appeal shall thereupon be deemed to be at issue.

Except as otherwise expressly provided, however, "the practice in civil cases shall apply to appeals" pursuant to RCW 51.52. RCW 51.52.140. Motions for entry of default are governed by CR 55, which provides:

(a) Entry of Default.

(1) Motion. When a party against whom a judgment for affirmative relief is sought has failed to appear, plead, or otherwise defend as provided by these rules and that fact is made to appear by motion and affidavit, a motion for default may be made.

A party who has not appeared prior to filing of a motion for default is not entitled to notice of the motion. CR 55(a)(3). A party "who has appeared in the action for any purpose," however, must be served with written notice of the default motion at least five days prior to the hearing on the motion. CR 55(a)(3); cf. CR 55(a)(2) ("[a]ny appearances for any purpose in the action shall be for all purposes under this rule 55"). Consequently, respondent was entitled to notice of the motions for default if it had "appeared" in "the action" for any purpose.

Appellant maintains that "the action" for purposes of CR 55 must be narrowly construed to mean only the appeal pursuant to RCW 51.52.110. Because respondent failed to file a notice of appearance for purposes of RCW 51.52.110, appellant reasons, it was not entitled to notice under CR 55. In support of this position, appellant points to the numerous procedural rules and deadlines governing proceedings under the workers' compensation act. See, e.g., Skagit Motel v. Department of Labor & Indus., 107 Wash.2d 856, 734 P.2d 478 (1987) (jurisdiction of the courts granted only upon conditions set forth in workers' compensation statutes).

Appellant's approach, however, confuses the consequences of a failure to file a notice of appearance under RCW 51.52.110, a question not before this court, with the concept of an appearance for purposes of CR 55. Given the general disfavor with which it is regarded,

the default judgment must normally be viewed as available only when the adversary process has been halted because of an essentially unresponsive party. In that instance, the diligent party must be protected lest he be faced with interminable delay and continued uncertainty as to his rights. The default judgment remedy serves as such a protection. Furthermore, the possibility of a default is a deterrent to those parties who choose delay as part of their litigative strategy. The notice requirement contained in Rule 55(b)(2) is, however, a device intended to protect those parties who, although delaying in a formal sense by failing to file pleadings within the twenty-day period, have otherwise indicated to the moving party a clear purpose to defend the suit.

H.F. Livermore Corp. v. Aktiengesellschaft Gebruder Loepfe, 432 F.2d 689, 691 (D.C.Cir.1970) (construing comparable federal rule). In order to further the principles underlying CR 55, we must therefore construe the concept of appearance broadly, not narrowly.

Washington's appearance statute, RCW 4.28.210, provides:

A defendant appears in an action when he answers, ... makes any application for an order therein, or gives the plaintiff written notice of his appearance. After appearance a defendant is entitled to notice of all subsequent proceedings; but when a defendant has not appeared, service of notice or papers in the ordinary proceedings in an action need not be made upon him.

The statutory methods of appearance, however, are not exclusive. Dlouhy v. Dlouhy, 55 Wash.2d 718, 721, 349 P.2d 1073 (1960). Whether a party has "appeared" for purposes of the rule requiring notice prior to an entry of default is generally a question "of intention, as evidenced by acts or conduct, such as the indication of a purpose to defend or a request for affirmative action from the court, constituting a submission to the court's jurisdiction ..." Annot., What Amounts to "Appearance" Under Statute or Rule Requiring Notice, to Party Who Has "Appeared," of Intention to Take Default Judgment, 73 A.L.R.3d 1250, 1254 (1976). Courts in Washington have construed the concept broadly and have found an appearance in a variety of circumstances. See, e.g., Dlouhy v. Dlouhy, supra (defendant's acts in resisting motion to convert temporary restraining order into injunction pending trial constitute appearance requiring notice of subsequent proceedings); Warnock v. Seattle Times Co., 48 Wash.2d 450, 294 P.2d 646 (1956) (defendant's service of demand for security for costs constituted appearance); State ex rel. Trickel v. Superior Ct., 52 Wash. 13, 100 P. 155 (1909) (defendant's service of interrogatories on plaintiff constituted appearance).

Courts in other jurisdictions have recognized a variety of informal acts on the part of a defendant as sufficiently responsive to constitute an appearance for purposes of rules comparable to CR 55. See, e.g., H.F. Livermore, supra (settlement negotiations and other exchanges between parties were sufficient to constitute appearance and require notice of application for default judgment); see also 6 J. Moore, Federal Practice p 55.05, at 55-27 (2d ed. 1988). Under some circumstances, where a defaulting party appeared in an earlier action that was essentially identical to a later action, the defaulting party was found to have appeared in the later action for purposes of requiring notice of a motion for default. See, e.g., Turner v. Salvatierra, 580 F.2d 199 (5th Cir.1978); Press v. Forest Laboratories, Inc., 45 F.R.D. 354 (S.D.N.Y.1968).

For purposes of this decision, however, we need not explore the outer boundaries of conduct that might constitute an appearance for purposes of CR 55. Here, respondent appeared and vigorously contested appellant's claims through all of the initial stages at the administrative level leading up to the appeal. Under these circumstances, appellant can have entertained no illusions regarding respondent's intentions to contest the claims.

In order to accept appellant's position, we would have to characterize the instant action as having essentially commenced in superior court, an approach that would elevate form over substance. Although an appeal from the Board of Industrial Insurance Appeals to superior court pursuant to RCW 51.52.110 involves a de novo hearing, the court's jurisdiction is appellate only; review is limited to the record before the Board. Rybarczyk v. Department of Labor & Indus., 24 Wash.App. 591, 593, 602 P.2d 724 (1979), review denied, 93 Wash.2d 1010 (1980); RCW 51.52.115. By definition, an appeal pursuant to RCW 51.52.110 is a continuation of "the action," even though the action was not formally initiated in court. Consequently, we conclude that respondent appeared in "the action" for purposes of CR 55. Having initially appeared, respondent was entitled to notice of the default proceedings. RCW 4.28.210; CR 55(a)(3).

Pursuant to CR 55(c), motions to vacate default judgments are governed by CR 60(b). In exercising its discretion to vacate a judgment pursuant to CR 60(b), the trial court considers the...