McGarvin-Moberly Const. Co. v. Welden

• Decision Date: 29 June 1995
• Docket Number: GARVIN-MOBERLY,93-242,Nos. 93-238,s. 93-238
• Citation: 897 P.2d 1310
• Parties: McCONSTRUCTION CO., a Wyoming corporation, Petitioner, v. Billy J. WELDEN and Josephine R. Welden, Respondents. Billy J. WELDEN and Josephine R. Welden, Petitioners, v. Dan A. HUNTER, Personal Representative of the Estate of Bertha Pauline Hunter, deceased; and McGarvin-Moberly Construction Co., a Wyoming corporation, Respondents.
• Court: Wyoming Supreme Court

Page 1310

897 P.2d 1310

McGARVIN-MOBERLY CONSTRUCTION CO., a Wyoming corporation, Petitioner, v. Billy J. WELDEN and Josephine R. Welden, Respondents.

Billy J. WELDEN and Josephine R. Welden, Petitioners, v. Dan A. HUNTER, Personal Representative of the Estate of Bertha Pauline Hunter, deceased; and McGarvin-Moberly Construction Co., a Wyoming corporation, Respondents.

Nos. 93-238, 93-242.

Supreme Court of Wyoming.

June 29, 1995.

Patrick J. Murphy of Williams, Porter, Day & Neville, P.C., Casper, and Thomas E. Hames of Cook, Kotel & Fitch, Denver, CO, for McGarvin-Moberly Const. Co.

Terry W. Mackey, Cheyenne, and C. Bradley Smith and Steve Simonton of Simonton & Simonton, Cody, for Billy J. Welden and Josephine R. Welden.

Harold E. Meier of Lonabaugh & Riggs, Sheridan, for Dan A. Hunter.

Before GOLDEN, C.J., and THOMAS, CARDINE, ^* MACY, and TAYLOR, JJ.

THOMAS, Justice.

Our sole concern in this case is the degree of participation in discovery and trial proceedings that should be afforded to a defendant in a personal injury case founded on negligence when default, but no judgment by default, has been entered against that defendant. After default was entered by the clerk of the trial court, the judge permitted the defendant in default to participate fully in the proceedings as they related to the damage issue. The judge did, however, foreclose that defendant from discovery relating to the issue of fault. Our analysis of the form in which the legislature has cast our comparative negligence statute leads to the conclusion that the issue of fault, as distinguished from liability, is no longer separable from the issue of damages. The two are intertwined to the extent that one cannot defend on the issue of damages without being permitted to participate with respect to the issue of fault. The defendant in default must be permitted to participate in proceedings which address the issue of relative fault because it is a significant factor in any damage award. We affirm the order of the district court permitting the participation of the defendant in default on the issue of damages, but we reverse that aspect of the court's order denying discovery relating to the issue of fault.

This court granted a Petition for Writ of Review, filed by McGarvin-Moberly Construction Company (McGarvin-Moberly), and it also granted a Petition for Writ of Review Pursuant to W.R.A.P. Rule 13, filed by Billy McGarvin-Moberly advances the question for consideration in this way:

J. Welden and Josephine R. Welden (Weldens), who are plaintiffs in the case. In addition to the petitions and briefs of McGarvin-Moberly and the Weldens, the defendant who was not in default, Dan A. Hunter, personal representative of the estate of Bertha Pauline Hunter (Hunter), appeared in this court.

Where default, but no default judgment, has been entered against one defendant in a multi-defendant comparative fault case, and where that defaulted defendant has "appeared" and complied with the Melehes v. Wilson requirements prior to any default judgment, should the trial court allow the defaulted defendant to present evidence, and argument, as to

A. plaintiffs' unliquidated damages, and

B. the allocation of fault among all the parties pursuant to the Wyoming comparative negligence statute, W.S. § 1-1-109?

The Weldens state these issues:

A. Under the Wyoming Rules of Civil Procedure, can a defendant "in default for failure to appear" cure the default and participate in discovery and at trial on damage issues, merely by filing a motion to set aside a default that is neither void nor voidable--a motion that was denied by the district court?

B. After entry of a valid default, do the defaulted party's rights to participate in the litigation terminate (assuming the Court refuses to set the default aside)?

In response to the McGarvin-Moberly Petition for Writ of Review, Hunter states the issue in this way:

The only issue presented is whether the Court erred in allowing McGarvin-Moberly to participate at all after default, and the extent of the participation, if any, whether as to fault, allocation of fault or damages.

This action arose out of a chain collision at a construction site on May 29, 1992. McGarvin-Moberly was the contractor for a project on Highway 310 between Greybull and Lovell. Three or four cars were stopped at the construction site when the Hunter vehicle approached the stopped cars from the rear. The Weldens were in a car at the front or near the front of the line and Mrs. Hunter failed to stop her car. It collided with the last car in the line causing a chain reaction so that the car behind the Weldens rear-ended their vehicle.

In their complaint, the Weldens alleged negligence on the part of Mrs. Hunter, who was driving the Hunter vehicle, and McGarvin-Moberly. They claimed the negligence of these defendants was the direct and proximate cause of their injuries and damages. McGarvin-Moberly failed to file an answer to the complaint within the twenty days provided in WYO.R.CIV.P. 12. On the thirty-third day, the clerk of the district court entered default against McGarvin-Moberly for failure to answer in accordance with WYO.R.CIV.P. 55(a). On the same day the Weldens moved for entry of a default in accordance with WYO.R.CIV.P. 55(b)(2). ¹

Sixteen days later, McGarvin-Moberly filed an entry of appearance with a motion to set aside the entry of default. McGarvin-Moberly filed its answer to the complaint the same day. After a hearing on the McGarvin-Moberly motion to set aside the entry of default, at which Weldens and McGarvin-Moberly appeared, the trial court issued a decision letter in which it found culpable conduct on the part of McGarvin-Moberly's insurance agent. An order then was entered reflecting the findings of the decision letter, which denied the McGarvin-Moberly motion to set aside the entry of default. McGarvin-Moberly attempted to seek relief from the court's order by a petition for writ of review filed in this court, but that writ of review was denied.

The Weldens then filed a Written Objection to Any Further Appearance in This Action by Defaulting Defendant McGarvin-Moberly and, later, filed a motion to bar further participation in the case by McGarvin-Moberly. The court held a hearing on that motion and ruled McGarvin-Moberly would be allowed "to participate fully in the discovery process and on issues concerning proximate cause and damages, and to participate in the jury trial on those same issues." The Weldens then asked the trial court to reconsider and vacate its ruling and, following additional arguments, the trial court issued a decision letter in which it stated McGarvin-Moberly could participate in the discovery process at trial concerning the issue of damages only. Hunter then requested the trial court to clarify the ruling from the bench as incorporated in its decision letter. The court conducted a telephone conference and entered an Order on Defendant McGarvin-Moberly's Further Participation, which provided:

NOW, THEREFORE, IT IS HEREBY ORDERED that Plaintiffs' Motion to Bar Defendant McGarvin-Moberly from further participating in this case is hereby DENIED to the extent that Defendant McGarvin-Moberly shall be permitted to participate in the discovery process and at trial solely on the issue of Plaintiff's damages.

IT IS FURTHER HEREBY ORDERED that the default entered against Defendant McGarvin-Moberly established McGarvin-Moberly's liability to each of the Plaintiffs.

IT IS FURTHER HEREBY ORDERED that Plaintiffs' Motion to Bar Participation and To Strike is GRANTED to the extent that Defendant McGarvin-Moberly shall be prohibited from participation in the discovery process and at trial (or in the absence of trial at the W.R.C.P. Rule 55 damages hearing) on issues of said Defendant's liability to Plaintiffs, proximate cause, allocation of fault and apportionment of damages.

Following Petitions for Writ of Review in this court, we consolidated those and granted them.

As the trial court correctly discerned, there is a difference between an entry of default under WYO.R.CIV.P. 55(a) as compared to a default judgment under WYO.R.CIV.P. 55(b). A defendant who is in default still may contest the issue of unliquidated damages. In Vanasse v. Ramsay, 847 P.2d 993, 996-97 (Wyo.1993) (quoting Spitzer v. Spitzer, 777 P.2d 587, 592 (Wyo.1989) (emphasis added)), we spoke to the distinction between default and a default judgment:

The distinction between an entry of default and a default judgment must here be recognized. Entry of default is normally a clerical act which may be performed by the clerk of court, and it does not constitute a judgment. The entry of default generally forecloses the party found to be in default from making any further defense The default judgment, on the other hand, in addition to the fact of liability, defines the amount of liability or the nature of the relief. This is generally done separately from the entry of default. Only in those situations where the damages sought are liquidated and claimed in the complaint may the court grant relief without further proceedings.

or assertion with respect to liability or an asserted claim. Although the entry of default generally establishes the fact of liability according to the complaint, it does not establish either the amount or the degree of relief.

In Vanasse, 847 P.2d at 1000, we also articulated the purpose to be served by a default judgment:

We note that:

[T]he default judgment must normally be viewed as available only when the adversary process has been halted because of an essentially unresponsive party. In that instance, the diligent party must be protected lest he be faced with interminable delay and continued uncertainty as to his rights. The default judgment remedy serves as such a protection. Furthermore, the possibility of a default is a deterrent to those parties who choose delay as part of their litigative strategy. (Emphasis added.)

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