Maple Leaf Canvas, Inc. v. Rogers

• Decision Date: 23 November 1992
• Docket Number: No. 92-469,92-469
• Citation: 311 Ark. 171,842 S.W.2d 22
• Parties: MAPLE LEAF CANVAS, INC., Appellant, v. Michael ROGERS and Serena Rogers, Appellees.
• Court: Arkansas Supreme Court

Page 22

842 S.W.2d 22

311 Ark. 171

MAPLE LEAF CANVAS, INC., Appellant, v. Michael ROGERS and Serena Rogers, Appellees.

No. 92-469.

Supreme Court of Arkansas.

Nov. 23, 1992.

John P. Lewis, Hot Springs, for appellant.

BROWN, Justice.

The sole issue in this case is whether the circuit court abused its discretion in entering a default judgment against the appellant, Maple Leaf Canvas, Inc. We hold that it did not, and we affirm the judgment.

The appellees, Michael Rogers and Serena Rogers, reside in Hot Springs in Garland County, and Maple Leaf does business in North Little Rock in Pulaski County. In April 1989, Maple Leaf sold a 175-foot canvas canopy to the appellees. That canopy developed problems and was replaced under warranty a year later by the manufacturer, United Textile. The second canopy then began to leak, and the appellees demanded a second replacement. When that was not forthcoming, they filed suit in Garland County on May 22, 1991. Service on Maple Leaf was attempted by certified mail, return receipt requested in North Little Rock, but the letter was not received, and service was not effected.

An attorney ad litem for Maple Leaf was appointed in Garland County. That attorney sent a certified letter, return receipt requested, restricted delivery, to Maple Leaf on June 6, 1991, advising it of the lawsuit and of the fact that a warning order was being published and enclosing a copy of the complaint and summons. The letter was addressed to Maple Leaf Canvas, Inc., c/o E. Gordon Oates, registered agent for service. The green return receipt was addressed to E. Gordon Oates, Maple Leaf Canvas, Inc. The box on the receipt entitled "Restricted Delivery" was checked. The attorney also caused a warning order to be issued and published in the Sentinel Record in Garland County on June 18, 1991, and June 25, 1991, warning Maple Leaf to appear in court in thirty days.

On June 18, 1991, Ron West, vice president of Maple Leaf, accepted the certified letter and signed the receipt card as the addressee. He then delivered it that same day, unopened, to Gordon Oates, the registered agent for service of process. The unopened letter with complaint and summons languished on Oates's desk until late August 1991, when he opened it and immediately contacted counsel.

The appellees moved for default judgment, and Maple Leaf responded that excusable neglect existed for the delay since service had not been properly effected on Maple Leaf. It further urged that it had a meritorious defense to the lawsuit. No challenge to the circuit court's personal jurisdiction was mounted by Maple Leaf. The circuit court refused to find excusable neglect and awarded judgment to the appellees in the amount of $6,800.

Our standard of review for the granting or denial of a motion for default judgment is whether the trial court abused its discretion. B & F Engineering v. Cotroneo, 309 Ark. 175, 830 S.W.2d 835 (1992); Cammack v. Chalmers, 284 Ark. 161, 680 S.W.2d 689 (1984). We have noted in our cases that default judgments are not favored in the law and that a default judgment may be a harsh and drastic result affecting the substantial rights of the parties. CMS Jonesboro Rehabilitation, Inc. v. Lamb, 306 Ark. 216, 812 S.W.2d 472 (1991); Burns v. Madden, 271 Ark. 572, 609 S.W.2d 55 (1980). We have also stated that failure to attend to business is not excusable neglect. CMS Jonesboro Rehabilitation, Inc. v. Lamb, supra.

To accomplish service by mail under Rule 4 of the Arkansas Rules of Civil Procedure, the return receipt must be signed by the addressee or the agent of the addressee. We have stated that requirements under Rule 4, being in derogation of common law must be strictly followed. Cole v. First National Bank of Fort Smith, 304 Ark. 26, 800 S.W.2d 412 (1990); citing Wilburn v. Keenan Cos. 298 Ark. 461, 768 S.W.2d 531 (1989).

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