Marinchek v. Paige, No. 17615

• Docket Nº: No. 17615
• Citation: 772 P.2d 879, 108 N.M. 349, 1989 NMSC 19
• Case Date: April 20, 1989
• Court: Supreme Court of New Mexico

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772 P.2d 879 108 N.M. 349 Maria Rude MARINCHEK, Plaintiff-Appellant,
v.
Gary PAIGE and North Valley, Ltd., Defendants-Appellees. No. 17615. Supreme Court of New Mexico. April 20, 1989.

Gallagher & Casados, P.C., Thomas L. Kalm, Nathan H. Mann, Albuquerque, for plaintiff-appellant.

Ray Twohig, Ray Twohig, P.C., Albuquerque, for defendants-appellees.

OPINION

RANSOM, Justice.

The trial court set aside a final judgment that had been entered against Gary Paige

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[108 N.M. 350] twenty-one months prior to his motion to vacate the judgment. Maria Rude Marinchek appeals. We reverse.

On August 31, 1984, Marinchek filed a complaint seeking collection of a debt and damages for fraud. The defendants were Paige and a general partnership in which Paige was a partner. Counsel appeared on behalf of both defendants, contending that any money transferred by Marinchek to them was a gift. Discovery was conducted, various pleadings and motions were filed, and two trial dates were set but then vacated.

Subsequently, on May 10, 1985, Paige telephoned his counsel to tell him he was leaving Albuquerque immediately and having his phone disconnected. Paige left a message for his counsel to "stop everything on the case." Nevertheless, his counsel continued to defend against the complaint. Trial was set for October 18. During a September motions hearing, counsel alerted the trial court that he was encountering some difficulty communicating with his client; he then moved to withdraw because he had had no contact with Paige for five months and had been unable to locate him. Counsel informed the court that he had attempted to telephone his client and mailed notices of the trial setting to Paige's residence at 7402 Pecos Trail (notwithstanding a November 1984 deposition in which Paige identified 7337 Guadalupe Trail as his current address) and to the partnership address at 6920 Fourth Street, but received no response. (Paige has attested that the Fourth Street partnership address was an alternative for mail until after November 1985.) The trial court granted the motion to withdraw but required defense counsel to notify Paige by certified mail that he needed to appear through new counsel or pro se by November 22; otherwise, a judgment of default would be entered against him. Counsel sent notice by certified and regular mail to the Pecos Trail and Fourth Street addresses. The record indicates that both the certified and regular mailings sent to Pecos Trail as well as the certified letter sent to Fourth Street were returned unclaimed.

On November 25, Marinchek informed the court that neither Paige nor new counsel had made an entry of appearance and she submitted copies of letters to establish that Paige's former counsel had complied with the court's order regarding withdrawal. She then presented evidence and testimony to support her claim of debt and damages for fraud. The court entered judgment and awarded the prayed-for compensatory and punitive damages, $101,500 and $100,000, respectively.

In August 1987, Paige contacted his former counsel who informed him of the judgment entered November 25, 1985. Paige then retained the services of his present counsel, who moved to vacate the judgment. Following two hearings concerning Paige's absence from the state, confusion as to his last known addresses, his ignorance of the intervening proceedings, and his claim to a meritorious defense, the trial court ordered that the judgment be vacated and the case set for trial.

Exclusivity of Rule 60 to set aside judgment by default. We initially address Paige's contention that the trial court had the authority under SCRA 1986, 1-055(C) (Rule 55) to set aside the judgment independently of SCRA 1986, 1-060 (Rule 60). Rule 55(C) provides that "[f]or good cause shown, the court may set aside an entry of default and, if a judgment by default has been entered, may likewise set it aside in accordance with Rule 1-060." ¹ Relying on the phrase "may likewise," Paige argues that a court has discretion to set aside a default judgment "for good cause shown" under Rule 55 and is not confined to application of Rule 60. Paige

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[108 N.M. 351] relies upon Starnes v. Starnes, 72 N.M. 142, 381 P.2d 423 (1963), as holding that compliance with the requirements of Rule 60 is optional in a petition to vacate a judgment.

The Starnes court, however, imprecisely spoke of "good cause shown" regarding substantial evidence to comply with Rules 55(C) or 60(B). The operative provision we consider under the next heading was not at issue in Starnes because there the excusable neglect provision of Rule 60(B)(1) was clearly applicable. We are satisfied that, regardless of whether the word "likewise" refers to "good cause shown," any showing of good cause to set aside a judgment by default must...