St. Arnold v. Star Expansion Industries

• Decision Date: 25 April 1974
• Citation: 521 P.2d 526,268 Or. 640
• Parties: Nick ST. ARNOLD, Respondent, v. STAR EXPANSION INDUSTRIES, a foreign corporation, Appellant.
• Court: Oregon Supreme Court

Page 526

521 P.2d 526

268 Or. 640

Nick ST. ARNOLD, Respondent, v. STAR EXPANSION INDUSTRIES, a foreign corporation, Appellant.

Supreme Court of Oregon, In Banc.

Argued and Submitted April 1, 1974.

Decided April 25, 1974.

William G. Wheatley, Eugene, argued the cause for appellant. With him on the brief were Jaqua & Wheatley and Richard A. Roseta, Eugene.

Joel B. Reeder, Medford, argued the cause and filed the brief for respondent.

TONGUE, Justice.

This is an appeal from an order denying defendant's motion to set aside a default judgment and also from a previous order denying defendant's motion to quash the summons and its service and to set aside the same judgment. We shall first discuss that motion and order.

1. The summons and its service was sufficient to confer jurisdiction on the court.

Defendant's motion to quash first contends that defendant was 'improperly named,' in that its proper name is Star Expansion Industries Corporation, not Star Expansion Industries, as named in the summons and complaint. Defendant says that plaintiff has named the 'wrong corporation.'

There was no showing, however, that there was another corporation named Star Expansion Industries. Service of a summons and complaint in that name was made personally upon the secretary of Star Expansion Industries Corporation. Thus, it appears that this is a case of service on the right of corporation by a wrong name, rather than one of service upon the wrong corporation.

In Foshier v. Narver, 24 Or. 441, at 445, 34 P. 21, at 22 (1893), it was held by this court:

'* * * Process served on a man by a wrong name is as really served on him as if it had been served upon him by his right name. In such case it seems to us that the court acquires jurisdiction over his person, and, unless he appears that puts in his defense, the court is authorized to proceed to judgment. Assuming, then, that the notice served upon the defendant ran to the name of P. J Narver, it does not follow, as a legal or logical consequence, that a service of such notice on J. Narver was service on the wrong party. On the contrary, after the defendant was so served, if he failed to appear and show that the plaintiff was not entitled to relief against him, because he was the wrong party, and not liable, when he had an opportunity to be heard on that question, the judgment established the fact that he was the right party and the plaintiff's right to relief against him.'

See also Walters et al. v. Dock Commission, 126 Or. 487, 511, 266 P. 634, 270 P. 778 (1928). ¹

Defendant's motion also contends that 'plaintiff failed to comply with ORS 15.040(2) in that the 'Notice to Defendant' required by that statute did not contain the proper time within which the Defendant was obliged to appear * * *.' ² The 'notice' at the bottom of the summons served upon this defendant stated that 'this paper must be give(n) to the court within Ten days * * *.' (Emphasis added) The provisions in the body of the summons stated, however, as provided by ORS 15.110(3), that defendant was required to appear 'if served within any other state within the United States, then within Four weeks from the date of the service of this summons * * *.' (Emphasis added)

It is contended that ORS 15.040, including its provisions for 'Notice,' relates solely to service of summons within the state, including service within the state upon the Corporation Commission 'as provided by law in certain cases' and that when personal service is made outside the state under ORS 15.110 the provisions of that statute are controlling and the addition of the 'Notice to Defendant' provided for in ORS 15.040 is not required. See dissenting opinion, State ex rel. Kalich v. Bryson, 253 Or. 418, 424, 453 P.2d 659 (1969).

In any event, defendant suffered no prejudice under the facts of this case. Service was made upon defendant on November 30, 1972, and judgment was not entered until January 18, 1973, far more than four weeks later. No appearance was made by defendant until April 24, 1973. At the most, defendant should have assumed that it was required to appear either within 10 days or within four weeks. Because defendant did neither it cannot claim that it was misled in any way to its prejudice. ³

Under these facts we hold that this defect in the provisions of the summons served upon defendant with respect to the time within which defendant was required to appear was not of such a nature as to deprive the court of jurisdiction. It follows that the trial court properly denied defendant's motion to quash. Cf. State ex rel. Kalich v. Bryson, 253 Or. 418, 422, 453 P.2d 659 (1969).

2. The trial court did not abuse its discretion in denying defendant's motion to set aside the default judgment as one taken against it through its 'mistake, inadvertence, surprise or excusable neglect.'

Defendant recognizes that ORS 18.160 expressly provides that motions to set aside default judgments for 'mistake, inadvertence, surprise or excusable neglect' are addressed to the discretion of the trial court and that its exercise of that discretion will not be reversed by this court unless there has been an abuse of discretion by the trial court. ⁴

In support of its contention that the trial court abused its discretion in this case defendant has cited King v. Mitchell, 188 Or. 434, 440, 214 P.2d 993, 216 P.2d 269 (1949), in which we held (at 441, 214 P.2d at 997) that the discretion of which the statute speaks is 'a legal discretion to be exercised in conformity with the spirit of the law and in a manner to subserve and not to defeat the ends of justice.' We also said in King (at 442, 214 P.2d at 997) that this statute is to be 'construed liberally to the end that every litigant shall have his day in court and his rights and duties determined only after trial upon the merits of the controversy.'

On the other hand, as defendant also recognizes, it is well established that a defendant seeking relief under ORS 18.160 from a default judgment must not only show that the judgment was entered against him through 'mistake, inadvertence, surprise or excusable neglect,' but the defendant must also show that he acted with reasonable diligence after knowledge of the default judgment and inexcusable delay will preclude him from relief. Koukal v. Coy et ux., 219 Or. 414, 418--420, 347 P.2d 602 (1959); Reeder v. Reeder, 191 Or. 598, 601, 232 P.2d 78 (1951); Steeves v. Steeves, 139 Or. 261, 265, 9 P.2d 815 (1932); and Rogue Val. Mem. Hosp. v. Salem Ins., 265 Or. 603, 510 P.2d 845 (1973).

Defendant contends, however, quoting from King v. Mitchell, Supra, 188 Or. at 444, 214 P.2d 993, that although the precedents are useful as guidelines for decision in such cases, each case must be determined on its own peculiar facts.

We therefore turn to a consideration of the facts of this case.

Summary of the facts.

In April 1971 plaintiff was seriously injured while installing an overhead door manufactured by defendant. On December 22, 1971, plaintiff's attorney sent a letter to defendant asking that it have a representative of its insurance carrier contact him. In January 1972 he was contacted by Mr. Kenneth Barrett, an independent insurance adjuster.

On September 25, 1972, after several months of negotiation, Mr. Barrett notified plaintiff's attorney that the insurance company was denying his client's claim. According to the affidavit of plaintiff's attorney, Mr. Barrett 'expressed to me that he was having trouble receiving anything one way or the other from the insurance company concerning the claim.' This is corroborated by the affidavit of Mr. Barrett; including a statement to the effect that as late as September 6, 1972, the insurance company office in Los Angeles was 'having difficulty with filing,' with the result that the district claims supervisor, Mr. Trimmer, had not 'reviewed the file.'

On November 1, 1972, plaintiff's complaint was filed and summons was issued. On that same date plaintiff's attorney sent a 'courtesy copy' to Mr. Barrett, who mailed it to Mr. Trimmer in Los Angeles on November 2, 1972. Upon receiving no further instructions, Mr. Barrett then closed his file and on November 20, 1972, forwarded to the insurance company his bill for services.

Meanwhile, the summons and complaint were served personally on Mr. Koslan, defendant's secretary, in Mountainville, New York, on November 30, 1972. On December 4, 1972, Mr. Koslan mailed the summons and complaint to the office of the insurance company in Poughkeepsie, New York, where it was stamped as 'received' on December 7, 1972. In that letter Mr. Koslan asked that he be 'kept advised in this matter.' The summons and complaint were then mailed to the Syracuse office of the insurance company and were received there on December 8, 1972.

According to the affidavit of the Syracuse district claims manager 'these suit papers did apparently turn up in Los Angeles on February 5, 1973.' He did not state, however, when these papers were mailed to Los Angeles, but said that he could 'only speculate' that 'these papers were possibly delayed in the mails or in some aspect of the paper handling that is so common to our business.'

According to the affidavit of the Los Angeles district claims manager the complaint and summons arrived at that office 'on February 5, 1973.' According to his affidavit, they were 'date stamped both in Poughkeepsie and Syracuse.' A copy of that 'date stamped' letter was attached to one of the affidavits. No letter or other documents showing a Los Angeles 'date stamp' were submitted. Neither was the original or copy of any transmittal letter submitted.

During this interval, however, the fourweek period for appearance had expired and on December 29, 1972, plaintiff filed a motion for an order of default, as well as a motion for a hearing on the amount of damages. That hearing was held on January 18, 1973, and on that date judgment was entered for $11,909.18 for the special damages...