Stafford v. Dickison

• Decision Date: 07 September 1962
• Docket Number: No. 4193,4193
• Citation: 374 P.2d 665,46 Haw. 52
• Parties: Mignonne STAFFORD v. J. Richard DICKISON and Lawrence Stuart, dba Airway Hawaii.
• Court: Hawaii Supreme Court

Page 665

374 P.2d 665

46 Haw. 52

Mignonne STAFFORD v. J. Richard DICKISON and Lawrence Stuart, dba Airway Hawaii.

No. 4193.

Supreme Court of Hawai'i.

Sept. 7, 1962.

Syllabus by the Court.

1. A defendant who has appeared in the action has a right to notice under H.R.C.P., Rule 55(b)(2) even if in default.

2. Failure to give notice of an application for default judgment under H.R.C.P., Rule 55(b)(2) does not in itself render the judgment void but instead is a procedural irregularity which may be rectified by appropriate means.

3. Though an attorney be warranted in withdrawing from a case, he should do so only on reasonable notice to the client, allowing him time to employ another lawyer.

4. When the attorney for a defendant who has appeared in an action and answered is permitted to withdraw on the day of pre-trial though the court knows that the client has left the State and has not been notified of the hearing or of the withdrawal of his counsel, and without notice a default is entered for defendant's failure to appear for pre-trial, followed by a default judgment also entered without notice, there has been such denial of opportunity to defend as to deprive defendant of due process and render the judgment void.

5. Defendant need not show a meritorious defense to set aside a void default judgment.

John L. Smart, Honolulu (Hughes & Alexander, Honolulu, on the briefs), for defendant-appellant.

Richard D. Welsh, Honolulu, for plaintiff-appellee.

Before TSUKIYAMA, C. J., and CASSIDY, WIRTZ, LEWIS and MIZUHA, JJ.

LEWIS, Justice.

This is an appeal from an order of March 4, 1960, which denied defendant's motion of January 21, 1960 to set aside a default judgment entered on January 22, 1959, and permit defendant to proceed to trial on the merits. The grounds for denying defendant's motion evidently were those stated in plaintiff's motion to strike defendant's motion, to wit, 'on the ground of laches and, further, that the grounds set forth therein do not comply with the provisions of Rule 60(b) of the Hawaii Rules of Civil Procedure.' ¹ The motions were heard on affidavits. The proceedings thereon hereinafter are referred to as the 1960 proceedings.

The complaint upon which the default judgment was obtained was filed March 4, 1955, and alleged that defendant was indebted to plaintiff in the amount of $3,000 for salary and wages earned in the calendar year 1953. Defendant while still a resident of Honolulu was served, and filed an answer and counterclaim in which he denied that he was indebted to plaintiff and averred that plaintiff was indebted to him in the amount of $360 for goods sold and delivered on or about March 25, 1954. On March 25, 1955 plaintiff filed a reply denying the counterclaim.

On December 1, 1958, the parties' attorneys were notified of a pre-trial conference. This was held on December 15, 1958 but defendant's attorney was not present. ² The minutes of December 15, 1958 read as follows:

'Minute Order

'Mr. Hughes [defendant's attorney] advised when contracted by telephone that he intended to withdraw as counsel for lack of cooperation from his client who had not answered a letter written to him in January of 1957 and he has not attempted to communicate with him since that date. He further advised that Defendant Dickison's last known address is 370 Orlena Avenue, Long Beach, California.

'Under the circumstances, default judgment will be entered to take effect 30 days from this date, during which period the Defendant shall have the opportunity to move to have it set aside. Otherwise, it will become final.

'Defendant will be served with a copy of this minute order at the aforementioned address. At the end of the 30-day period, the Plaintiff may apply to the clerk of the Court for default judgment under Rule 55(b)(1).'

At the time of the December 15, 1958 hearing defendant's attorney had not withdrawn but did so by a paper dated on that same day, approved by the trial judge, served on plaintiff's attorney the following day, and filed December 17, 1958. In a supporting affidavit the withdrawing attorney averred that on January 4, 1957 he wrote his client 'at his last known address' (presumably the Long Beach, California, address appearing in the above-quoted minute order) and received no reply to the letter. The subject of this letter was the client's arrears in support payments, an entirely different matter.

On January 16, 1959 plaintiff moved for entry of default judgment. Her accompanying affidavit averred 'that the default of the defendant has been entered for failure to appear in the action.' ³ On January 19, 1959, the court ordered that judgment by default be entered in favor of the plaintiff and that defendant's counterclaim be dismissed. The order recited that the matter had come on for hearing on December 15, 1958, that the plaintiff and her attorney were present, and that defendant 'failed to appear to defend this action.' On January 22, 1959 the motion and order were filed, together with a judgment reciting that the court had ordered entry of a default judgment. The judgment was for the amount shown in plaintiff's affidavit accompanying the motion for entry of default judgment, which was in conformity with the prayer of the complaint.

Notice of entry of the judgment was sent by the clerk to the address of Airway Hawaii, shown by the sheriff's return as the place at which defendant was served in Honolulu. The record contains no certificate or other proof of service of the judgment by plaintiff. In the 1960 proceedings her attorney filed an affidavit averring that he was unable to secure defendant's address from defendant's former counsel 'who claimed privilege.' However, according to the minutes, plaintiff's attorney was present in court on December 15, 1958 when the court made the minute order above set out, containing the Long Beach address. Plaintiff's attorney contests the sufficiency of the showing that he heard the court announce this address. In any event, we must take it from the record that no notice of entry of the judgment was given defendant except that sent by the clerk addressed to Airway Hawaii.

After the default judgment was obtained, according to an affidavit of plaintiff's attorney filed in the 1960 proceedings, 'efforts were commenced to trace the defendant commencing with the address 119 S. Santa Fe, Compton, California, an address at which the defendant had at one time lived and which address was purportedly the address of his father. This address was furnished to affiant by [plaintiff] after the entry of judgment * * *.' Copies of letters of a Compton collection agency, furnished by plaintiff in the 1960 proceedings, show that defendant was contacted through this agency in April or May 1959 and claimed 'that he was never served with any kind of papers and had absolutely no knowledge of these goings on at all.' The affidavit of defendant's attorney shows that defendant eventually was sued in California on the Hawaii judgment. Upon argument in this court, plaintiff's counsel offered to show that the California suit was commenced in July 1959, and we will assume this to be the case.

We first will consider the nature of the present appeal. In Kahue v. Palaualelo, 25 Haw. 805, it was held that an order denying a motion to open a default was interlocutory and not subject to appeal as a matter of right, and this court said obiter that an order refusing to set aside a judgment by default is governed by the same rule. Since a judgment entered on a default, unlike the mere entry of a default, is not interlocutory, this dictum was too broad. Previously the court had reviewed an order refusing to set aside a default judgment, affirming it however as within the discretion of the court. G. W. Macfarlane & Co. v. McCandless, 8 Haw. 118. Again, in Kekaula v. Kaaukai, 9 Haw. 473, Kapiolani Estate, Ltd. v. M. S. Grinbaum & Co., 14 Haw. 583, and Takamoto v. Horita, 23 Haw. 370, the court reviewed orders refusing to set aside default judgments and affirmed them on the ground there was no abuse of discretion. In Vivas v. Akoni, 14 Haw. 115, and Bobkoff v. Chesticoff, 24 Haw. 447, such orders were reviewed and reversed. By the weight of authority an order refusing to set aside a default judgment is appealable. Annot., 108 A.L.R. 225.

However, it has been held that an order refusing to reopen a case for rehearing is not reviewable, for the appeal must be from the judgment. Makalei v. Himeni, 7 Haw. 168, followed in Nakeu v. Mahaulu, 22 Haw. 750, and Mendiola v. Aiau, 29 Haw. 340. In the first cited case the court said at 169:

'The effect of holding that refusal of a motion to re-hear is appealable, would be to nullify the statutes and rules of Court which limit the time for taking appeal to ten days after decree. It would only be necessary at any time to move for a rehearing, and to appeal from the denial of this, bringing up the whole matter before the Court in banco, or if the course should be to send it back to the justice for a rehearing, then to appeal from his second judgment within the ten days, and so come before this Court on the merits.'

This line of cases points up the importance of demarking the limits of a motion under Rule 60(b) in certain cases. ⁴ However, in the present case we need not decide the exact scope of a motion under Rule 60(b). We have concluded that defendant's contention that the judgment was void disposes of the case. Clause (4) of Rule 60(b) specifically provides for relief thereunder if 'the judgment is void.'

Defendant argues that he was not in default when the judgment was entered and that 'the default judgment was inappropriate and void' since he had answered. ⁵ He relies on cases in which a defendant, after answering, failed to appear at the trial and was held not in default within the meaning of Rule 55. ⁶ But the instant case is different and presents the question whether the fact that an answer has been filed precludes...