Hayes Indus. Brake, Inc. v. Mechanical & Indus. Fasteners, Inc.
| Decision Date | 19 July 1995 |
| Docket Number | No. 94-1178,94-1178 |
| Citation | 196 Wis.2d 371,539 N.W.2d 134 |
| Court | Wisconsin Court of Appeals |
| Parties | NOTICE: UNPUBLISHED OPINION. RULE 809.23(3), RULES OF CIVIL PROCEDURE, PROVIDE THAT UNPUBLISHED OPINIONS ARE OF NO PRECEDENTIAL VALUE AND MAY NOT BE CITED EXCEPT IN LIMITED INSTANCES. HAYES INDUSTRIAL BRAKE, INC., Plaintiff-Respondent, v. MECHANICAL & INDUSTRIAL FASTENERS, INC., Defendant-Appellant. |
Before ANDERSON, P.J., BROWN and NETTESHEIM, JJ.
Mechanical & Industrial Fasteners, Inc. (MIFAST) appeals from a default judgment in favor of Hayes Industrial Brake, Inc. (Hayes). Because we conclude that the trial court properly exercised its discretion in granting a default judgment and determining damages, we affirm.
In 1991, a dispute arose between MIFAST and Hayes regarding parts which MIFAST was supposed to supply to Hayes. On February 24, 1992, Hayes sued MIFAST for damages. On May 8, 1992, Hayes moved the trial court for default judgment because MIFAST's president, Alois Hartmann, had been personally served with a summons and complaint on March 30, and the time for answering had long since expired. MIFAST filed an answer on June 1. On June 2, Hayes moved to strike MIFAST's answer as untimely. At a June 3 hearing on Hayes's motion for default judgment, the court granted MIFAST a continuance to allow it to demonstrate the reason it did not file a timely answer.
At a June 15 hearing, Hartmann testified that he was served the summons and complaint on the date indicated on the affidavit of service (March 30), that he put the documents in a "Hayes" file and gave the file to a trainee administrative assistant in the expectation that the documents would be forwarded to counsel. The documents were never forwarded to counsel. In April, Hartmann became aware that legal proceedings involving Hayes were pending and learned in May that the summons and complaint had not reached counsel. Hartmann did not follow up on the status of the case after he gave the file to his assistant due to the large number of legal documents coming into the office involving another case. After oral argument, the trial court took Hayes's motion for default judgment under advisement.
On September 25, the trial court rendered its decision on Hayes's motion for default judgment. The trial court concluded that the facts adduced at the previous hearing did not establish excusable neglect for failing to timely answer the complaint. The court directed Hayes to submit an affidavit itemizing its damages arising from MIFAST's failure to deliver parts as required by the parties' contract. MIFAST filed a counteraffidavit.
At a September 27 hearing, MIFAST argued that Hayes's affidavit was defective because it contained hearsay. The court rejected MIFAST's argument on the grounds that it could take proof, in whatever form, of any fact necessary for the court to enter a judgment. See § 806.02(2), Stats. The trial court did not perceive itself to be limited in the form in which it could accept proof. However, the court was not satisfied that Hayes had submitted sufficient proof of damages, and it required Hayes to file another affidavit setting forth the efforts it made to mitigate its damages. On March 15, 1994, after reviewing the parties' submissions on damages, the court awarded Hayes $96,710.93 in damages.
On appeal, MIFAST protests the entry of default judgment and claims that the trial court erred in awarding damages. Whether to grant a default judgment is within the trial court's discretion. Martin v. Griffin, 117 Wis.2d 438, 442, 344 N.W.2d 206, 209 (Ct.App.1984). In order to avoid the entry of a default judgment for failing to timely answer Hayes's complaint, MIFAST had the burden to show excusable neglect. See id. at 443, 117 Wis.2d 438, 344 N.W.2d at 209. Although the trial court concluded that MIFAST did not demonstrate excusable neglect, it did not explicitly state the facts upon which it based that conclusion. Therefore, we will independently review the record to determine whether it provides a basis for the trial court's exercise of discretion. Town of Seymour v. City of Eau Claire, 112 Wis.2d 313, 322, 332 N.W.2d 821, 825 (Ct.App.1983). We are obliged to uphold a discretionary decision if we can conclude that there are facts of record which would support the trial court's decision. Liddle v. Liddle, 140 Wis.2d 132, 150-51, 410 N.W.2d 196, 204 (Ct.App.1987).
The record supports the trial court's discretionary decision to grant Hayes a default judgment. MIFAST's president testified that he was served with a summons and complaint, handed it to a trainee administrative assistant and never followed up. Hartmann also testified that MIFAST was involved in other litigation during the period in which MIFAST should have answered Hayes's complaint.
"Excusable neglect is 'that neglect which might have been the act of a reasonably prudent person under the same circumstances' and is not synonymous with neglect, carelessness or inattentiveness." Martin, 117 Wis.2d at 443, 344 N.W.2d at 209 (quoted source omitted). Hartmann's failure to follow up is not "the act of a reasonably prudent person under the circumstances." See id. at 443, 117 Wis.2d 438, 344 N.W.2d at 209. The trial court properly exercised its discretion in entering a default judgment in favor of Hayes. See id. at 442, 117 Wis.2d 438, 344 N.W.2d at 209.
In so holding, we distinguish this case from Baird Contracting, Inc. v. Mid Wisconsin Bank, 189 Wis.2d 321, 525 N.W.2d 276 (Ct.App.1994). In Baird, we held that the trial court properly exercised its discretion when it vacated a default judgment after determining that the bank's failure to timely answer a complaint served upon a bookkeeping supervisor constituted excusable neglect. See id. at 326-27, 189 Wis.2d 321, 525 N.W.2d at 278. There the trial court made the following findings: (1) the supervisor did not have training in legal matters; (2) the supervisor had been employed in her position for only six months; (3) the documents got "buried" on her desk; and (4) the bookkeeping department was "swamped" with work and short staffed at the time service was made. Id. 525 N.W.2d at 325-26, 525 N.W.2d at 277-78.
In Baird, we observed that "[w]hile attorneys and insurance company claims employees are regularly involved with lawsuits and trained to recognize the importance of timely...
To continue reading
Request your trial