James v. Francesco

• Decision Date: 16 October 1972
• Citation: 61 N.J. 480,295 A.2d 633
• Parties: Betty, Allison JAMES, Plaintiff-Respondent, v. Philip J. FRANCESCO, Defendant-Appellant.
• Court: New Jersey Supreme Court

Page 480

61 N.J. 480

295 A.2d 633

Betty, Allison JAMES, Plaintiff-Respondent, v. Philip J. FRANCESCO, Defendant-Appellant.

Supreme Court of New Jersey.

Argued Sept. 12, 1972.

Decided Oct. 16, 1972.

Bennett I. Bardfeld, Vineland, for appellant.

John L. White, Woodbury, for respondent (White, Simpson & Strout, Woodbury, attorneys).

The opinion of the Court was delivered by

CONFORD, P.J.A.D., Temporarily Assigned.

In 1965 plaintiff was injured in a motor vehicle accident in North Carolina, and two years later she obtained a default judgment in that state against defendant, a New Jersey resident, and two others, in the sum of $9,417.36 for personal injuries and property damage. Defendant, who was not the driver of any car involved, was served by mail in New Jersey by the North Carolina Commissioner of Motor Vehicles under the purported authority of the North Carolina non-resident motorists statute. N.C.G.S. §§ 1--105 to 1--106. Plaintiff then instituted the present action in the Superior Court, Law Division, on the North Carolina judgment.

The trial court refused to allow defendant to attack the North Carolina judgment for lack of personal jurisdiction over him, holding that such an attack could only be made before the North Carolina Court and that New Jersey would entertain an assault on the foreign judgment only in the case of fraud. The court consequently rendered judgment for plaintiff in May 1970 and defendant timely appealed.

Four months later the Appellate Division, on its own motion, dismissed the appeal for failure to prosecute. Defendant then retained a different attorney, who, after ascertainment of the facts and obtaining the papers from the first attorney, moved to reinstate the appeal. The Appellate Division denied this motion and defendant petitioned this Court for certification.

Oral argument on the petition for certification was held on October 26, 1971, and at that time the parties were instructed to submit supplemental briefs as to whether registration of the vehicle in defendant at the time of the accident ¹ was sufficient to vest jurisdiction over him in the North Carolina courts and as to when title to the motor vehicle passed under New Jersey law. The court thereafter granted certification, 59 N.J. 526, 284 A.2d 351 (1971), and directed the parties to file further briefs on the issues as to whether full faith and credit had to be accorded to the North Carolina judgment and whether defendant was required to seek any relief to which he might be entitled on jurisdictional grounds in the North Carolina courts.

Although, when the petition for certification was first brought before the court, the narrow issue presented was the justification for the Appellate Division's failure to grant the motion to restore the appeal to the calendar, it is apparent from the foregoing recital that the court deemed that issue affected by the probable merits of the appeal. By thus expanding the area of inquiry we have gained an insight into the legal and factual issues involved on the merits, and the parties have had full opportunity to be heard thereon. For reasons to be stated hereinafter we conclude that the appeal does have substantial merit. Moreover, without need here to state all the pertinent details, it is clear to us that defendant was egregiously misrepresented by his first attorney on the appeal. Suffice it to say that whereas there was a good case to be made on the appeal the attorney, although paid an appeal retainer, defaulted on his obligation to file a brief, and, after being notified that the appeal had been dismissed for lack of prosecution, concealed that fact from defendant and merely informed him that it would be advisable for him to obtain more experienced counsel. Substituted counsel for defendant filed an application to reopen together with a proposed appeal brief with the Appellate Division as soon as he reasonably could after some delay in obtaining the suit papers from the first attorney.

In such circumstances of probable merit and serious default of representation by the first attorney a proper case for relaxation of the rules is presented in order to subserve the first objective of the rules of practice--the accomplishment of substantial justice on the merits. See Gnapinsky v. Goldyn, 23 N.J. 243, 128 A.2d 697 (1957); Paxton v. Misiuk, 34 N.J. 453, 170 A.2d 16 (1961). The order of the Appellate Division denying the motion to reinstate the appeal is reversed and the appeal is reinstated.

Since the merits of the appeal have been fully briefed and argued in this court we proceed to a consideration thereof rather than remand the appeal for disposition by the Appellate Division.

We hold, first, that the trial court erred in ruling that defendant was precluded from attacking in New Jersey the validity of the North Carolina judgment for lack of In personam jurisdiction over him. Plaintiff supports that ruling by invoking the Full Faith and Credit Clause of the United States Constitution, Art. IV, § 1. But the law is clearly to the contrary. That provision applies only where the judgment of the foreign state is 'founded upon adequate jurisdiction of the parties and subject matter.' Klaiber v. Frank, 9 N.J. 1, 10, 86 A.2d 679, 684 (1952); Restatement 2d, Conflict of Laws, §§ 104, 105, pp. 315--316 (1969). A judgment is void if there has been a failure to comply with a requirement which is a condition precedent to the exercise of jurisdiction by the court. Restatement, Judgments, § 8, comment b, pp. 46--47 (1942). A judgment which is void is subject to collateral attack both in the state in which it is rendered and in other states. Id., § 11, p. 65. Finally, extrinsic evidence is admissible in a collateral attack upon a foreign judgment to show that it is void. Id., § 12, p. 69.

We thus turn to an examination of the basis for defendant's contention that the North Carolina judgment was obtained without personal jurisdiction over him. Briefly, defendant asserts that he was not the owner of the vehicle in question at the time of the accident, that he had sold it several months earlier, and that it was not being operated by him or his agent or on his behalf, but rather by an agent of his purchaser. In such circumstances, it is contended, the North Carolina statute permitting service out of state upon non-resident motorists was not applicable, and since defendant was served by mail in New Jersey pursuant to that statute and not personally within the borders of North Carolina he asserts the judgment against him was void for lack of personal jurisdiction.

So far as here material, and as construed by the North Carolina courts, the North Carolina statute permitting service by mail out of state on non-resident motorists, N.C.G.S. § 1--105, provides that such service of process may be made through the Commissioner of Motor Vehicles 'in any action or proceeding * * * growing out of any accident or collision in which (a) nonresident may be involved by reason of the operation by him, for him, or under his control or direction, express or implied, of a motor vehicle on (the) public highways of this State * * *.' See Howard v. Sasso, 253 N.C. 185, 116 S.E.2d 341 (Sup.Ct.1960). Moreover, in the application of that statute there becomes operative the provisions of N.C.G.S. § 20--71.1 to the effect that (a) in any automobile negligence action proof of ownership of the vehicle at the time of the accident 'shall be prima facie evidence' that the vehicle 'was being operated and used with the authority, consent, and knowledge of the owner' in the transaction out of which the cause of action arose; and (b) that proof of 'registration of a motor vehicle in the name of any person * * * shall for the purpose of any such action, be prima facie evidence of ownership and that such motor vehicle was then being operated by and under the control of a person for whose conduct the owner was legally responsible, for the owner's benefit, and within the course and scope of his employment.' See Howard v. Sasso, Supra, holding that for jurisdictional purposes the fact of ownership of the vehicle by the non-resident permits but does not compel a finding of agency. Plaintiff cites Todd v. Thomas, 202 F.Supp. 45 (E.D.N.C.1962). If that case can be read as holding that the fact of ownership is conclusive of agency against the non-resident owner, jurisdictionally, it is contrary to Howard v. Sasso, Supra, and obviously incorrect. In short, under authoritative construction of the act, the efficacy of jurisdiction by service out of state is dependent upon the fact of agency for the non-resident of the driver of the vehicle at the time of the accident. Ownership of the vehicle by the non-resident is Prima facie proof of such agency, and registration in the non-resident is Prima facie proof of ownership.

It is noteworthy that, in respect of the substantive effect of N.C.G.S. § 20--71.1, the North Carolina rule is that notwithstanding the evidential effect of the statutory presumption arising from ownership it is mandatory for a trial court, where the only positive proof of agency is that the driver was on business totally unconnected with the owner, to charge the jury, in terms directly related to the evidence in the case, that if they find the facts to be as the owner's evidence tends to prove, it is their duty to find in favor of the owner on the agency issue. Belmany v. Overton, ...