Grossman v. Will, 1528--I

• Decision Date: 10 December 1973
• Docket Number: No. 1528--I,1528--I
• Parties: Arthur Jay GROSSMAN, Respondent, v. Oscar K. WILL and Betty K. Will, his wife, individually and as a community, Defendants, and Melvin G. Heide and Jane Doe Heide, his wife, individually and as a community, Appellants, and Arthur Cooperstein and Jane Doe Cooperstein, his wife, individually and as a community, d/b/a Wakefield Investments, a limited partnership, Defendants. Martin PERLIN, Respondent, v. Oscar WILL and Jane Doe Will, his wife, Defendants, Melvin G. Heide and Jane Doe Heide, his wife, Appellants, and Arthur Cooperstein and Jane Doe Cooperstein, individually and as co-partners in that certain partnership, doing business under the name and style of Wakefield Investments, Defendants.
• Court: Washington Court of Appeals

Page 141

10 Wn.App. 141

516 P.2d 1063

Arthur Jay GROSSMAN, Respondent, v. Oscar K. WILL and Betty K. Will, his wife, individually and as a community, Defendants, and Melvin G. Heide and Jane Doe Heide, his wife, individually

and as a community, Appellants,

and

Arthur Cooperstein and Jane Doe Cooperstein, his wife,

individually and as a community, d/b/a Wakefield

Investments, a limited partnership, Defendants.

Martin PERLIN, Respondent, v. Oscar WILL and Jane Doe Will, his wife, Defendants, Melvin G. Heide and Jane Doe Heide, his wife, Appellants, and Arthur Cooperstein and Jane Doe Cooperstein, individually

and as co-partners in that certain partnership,

doing business under the name and style

of Wakefield Investments, Defendants.

No. 1528--I.

Court of Appeals of Washington, Division 1.

Dec. 10, 1973.

Law Offices of Malcolm L. Edwards, Seattle, Jack E. Wetherall, Seattle, of counsel, William M. Robinson, Seattle, for appellants.

Barnett, Robben, Blauert & Pease, William Merchant Pease, Seattle, for Grossman.

Ryan, Bush, Swanson & Hendel, Douglas R. Hendel, Seattle, for Will.

HOROWITZ, Judge.

Plaintiffs Perlin and Grossman each recovered a summary judgment by default on promissory notes, including attorney's fees, against defendants Heide, husband and wife, 'individually and as a community.' The court in each case denied defendants' timely motions to set aside the judgment and then adhered to that denial on defendants' respective motions for reconsideration. Defendants Heide appeal the judgments, the orders refusing to vacate them, and the denial of the Heides' motions for reconsideration. The appeals have been consolidated for hearing.

The basic question raised is whether Mrs. Heide's showing in support of her motions to vacate and to reconsider prima facie establishes a defense on the merits to each action. A subsidiary question raised is whether an attorney purporting to serve and file an appearance for her in each case had authority by virtue of his office, and without her express knowledge and consent, to bind her to a stipulation claimed by plaintiff creditors to waive her defenses on the merits to the claims asserted against her. We answer the first question in the affirmative, the second in the negative, and accordingly reverse the orders from which the appeals are taken.

When the trial court finally refused to set aside the judgments in each case, the following were the controlling facts at least prima facie established. Plaintiffs, in their respective cases, sued the same individual defendants and their respective wives, including defendants Heide. In each case, the complaints alleged the date and execution of the notes by Melvin G. Heide on behalf of himself individually and on behalf of the marital community composed of the defendants Heide. The complaints did not allege the date defendants Heide were married; however, the later affidavits supporting the motion to vacate the judgments establish prima facie the date of marriage was October 12, 1969--after certain of the notes had been executed and delivered. Each of the notes was the separate obligation of defendant Melvin G. Heide; the notes were not community obligations, and Mrs. Heide was not individually liable thereon.

PERLIN ACTION.

The facts are these: On September 24, 1970, plaintiff filed an action on two installment notes against defendants Heide and others. The first note was for $5,000, executed and delivered on May 29, 1969, before marriage, and signed 'WAKEFIELD INVESTMENTS, by: Oscar Will, by: Melvin G. Heide.' The second note was for $8,300, executed and delivered on December 22, 1969, after marriage, and signed 'WAKEFIELD INVESTMENTS, Melvin G. Heide.'

On November 2, 1970, at Mr. Heide's request, Attorney Douglas R. Hendel served and filed a notice of appearance for all defendants, including 'Jane Doe Heide.' Mrs. Heide (LaRayne M. Heide), however, neither knew of nor expressly authorized Mr. Hendel to appear for or represent her in the litigation.

On November 9, 1970, Attorney William M. Robinson, at the request of Mrs. Heide, filed a notice of appearance for her and by mail served plaintiff's attorneys with a copy of that appearance. The attorney substitution procedure provided by RCW 2.44.040--.050 was not utilized.

On November 12, 1970, settlement negotiations culminated in the execution of a stipulation by 'the parties hereto' settling the litigation. Plaintiff Perlin and his attorneys signed; Attorney Douglas R. Hendel signed as 'Attorney for defendants OSCAR K. WILL, MELVIN G. HEIDE, ARTHUR COOPERSTEIN.' Defendants Will and Melvin G. Heide signed, as did Wakefield Investments, a limited partnership, by Arthur Cooperstein, Trustee, General Partner. Attorney Hendel did not sign as attorney for LaRayne M. Heide and she did not sign. She was not an expressly named party to the stipulation. Paragraph 7 of the stipulation reads:

7. In the event that the defendants fail to make any of the payments above specified, it is agreed plaintiff shall be entitled to judgment against the defendants and each of them . . . In such event, plaintiff shall file a motion for entry of judgment, which judgment is hereby confessed and consented to, provided only, that plaintiff give at least ten (10) days written notice of plaintiff's application for entry of said judgment, and cause the same to be served by registered mail on the defendants' counsel, DOUGLAS R. HENDEL, at his office address in Seattle, Washington . . .

Defaults in the stipulated payments occurred. Plaintiff on December 23, 1971 then filed an affidavit-supported 'Motion for Summary Judgment' based on the defaults mentioned. The supporting affidavit referred to the 'stipulation filed herein'; stated '(t)hat under the terms of said stipulation, defendants were to pay . . .' The affidavit did not note the absence of Mrs. Heide's signature on the stipulation, nor the absence of Attorney Hendel's signature on that stipulation on her behalf. Plaintiff also served on Attorney Hendel a note for motion docket fixing January 7, 1972 as the hearing date. Neither defendants Heide nor Attorney Robinson were served with copies of the motion and notice, nor knew of them. Attorney Hendel's affidavit in support of the defendants' motion to vacate the summary judgment explains that:

At the time of service, I was not aware that I was the attorney of record for defendants Heide and assumed that William M. Robinson, an attorney at law, whom I knew to be Mr. Heide's personal attorney, would appear on their behalf and resist said motion.

No one appeared to resist the motion. Plaintiff then obtained what plaintiff calls a 'summary judgment,' and what defendants call a 'default summary judgment,' against defendants Heide on January 7, 1972 for the amounts claimed.

On January 19, 1972, defendants Heide, pursuant to CR 60(b)(1), served upon the plaintiff's attorneys of record and filed a 'Motion to Vacate Default Summary Judgment.' Plaintiff was not otherwise served. On January 20, 1972, Attorney Robinson likewise served and filed an appearance for defendant Melvin G. Heide and the marital community composed of the Heides. The motion to vacate was supported by affidavits of Attorneys Hendel and Robinson, and the Heides. At the same time, the Heides obtained an ex parte injunction enjoining the collection of the judgments. The injunction was later vacated and is no longer material to the issues here. Plaintiff's attorneys appeared generally to resist the motion and injunction. The record of the case before the court, together with the affidavits supporting the motion to vacate the default judgment, subject to what is next stated, embodies the substance of the facts heretofore reviewed. The affidavits also contain a claimed defense apparently argued below, but no longer relied upon.

The trial court denied the motion to vacate, the order reciting 'that no valid defense exists on the part of defendants Heide . . .' He later denied the motion for reconsideration notwithstanding Mrs. Heide meanwhile had filed a supplemental affidavit stating in part:

(T)hat at the time of execution of said Stipulation by Mr. Hendel, I had never met him, never retained him, and never authorized him to act on my behalf in this or any other matter, had no knowledge of the Stipulation and had retained William M. Robinson to act as my attorney in this matter; and that to the extent that Mr. Hendel may have purported to act on my behalf in executing said Stipulation, said acts were without my authorization and knowledge and that at no time did I ever agree to personally assume any obligations in this or any other action on behalf of my marital community or myself individually for any separate debts of my husband, defendant Melvin G. Heide.

The statement of facts certified by the trial court includes the following narrative statement:

No court reporter was present during these proceedings. During the proceedings before the court, Mr. Hendel advised the court that he had never met the defendant, LaRayne M. Heide; that he had never been authorized by her to represent her; that he was not authorized to execute the stipulation filed herein on her behalf; that the former interest of the defendant Melvin G. Heide in Wakefield Investments was Mr. Heide's separate property and not community property; and that the defendant LaRayne M. Heide had received no consideration for the execution by Mr. Hendel of the stipulation filed herein.

It does not appear whether Mr. Hendel's statements to the court were made at the time of the hearing on the motion to vacate or at the time of the hearing on the motion for reconsideration, or on both occasions.

GROSSMAN ACTION.

The controlling facts in Grossman are largely similar to and parallel those in the Perlin case. There are differences, including amounts and dates, but, as in Perlin, the showing is the notes were the separate obligations of defendant Melvin G. Heide; were not...