United Accounts, Inc. v. Lantz

• Court: North Dakota Supreme Court
• Writing for the Court: TEIGEN
• Citation: United Accounts, Inc. v. Lantz, 145 N.W.2d 488 (N.D. 1966)
• Decision Date: 13 October 1966
• Docket Number: No. 8311,8311
• Parties: UNITED ACCOUNTS, INCORPORATED, Bismarck, North Dakota, Plaintiff and Appellant. v. Kasper LANTZ, Defendant and Respondent.

Page 488

145 N.W.2d 488

UNITED ACCOUNTS, INCORPORATED, Bismarck, North Dakota Plaintiff and Appellant. v. Kasper LANTZ, Defendant and Respondent.

No. 8311.

Supreme Court of North Dakota.

Oct. 13, 1966.

Syllabus by the Court

1. Where defendant failed to answer within the time prescribed by the Rules of Civil Procedure, but served an answer on the plaintiff before plaintiff made application for a default judgment, the defendant 'has appeared in the action' within the meaning of Rule 55, N.D.R.Civ.P., and plaintiff is required by said rule to serve a written notice at least eight days prior to a hearing on his application for a default judgment.

2. A judgment taken by default, without notice, where a belated appearance has been made, is irregular, but is not void, and must be set aside when proper and seasonable application is made for that purpose.

3. Where a default judgment has been irregularly entered it is within the discretionary power of the trial court to determine whether a defendant shall prevail on a motion to set it aside, and unless an abuse of discretion be made to appear, this Court will not interfere.

4. Rule 60, N.D.R.Civ.P., providing for relief from judgments, is remedial in nature and should be liberally construed and applied.

5. What constitutes a reasonable time under the Rules of Civil Procedure providing a party may be relieved from a judgment in certain instances upon motion within a reasonable time, varies from case to case and must be determined in each instance from the facts before the court. Rule 60(b), N.D.R.Civ.P.

Conmy, Conmy, Rosenberg & Lucas, Bismarck, for plaintiff and appellant.

R. J. Bloedau, Mott, for defendant and respondent.

TEIGEN, Chief Justice.

The plaintiff appeals from an order of the County Court with Increased Jurisdiction, Stutsman County, vacating a default judgment.

The material facts are: The plaintiff brought action against the defendant in the County Court of Stutsman County to recover the sum of $425.56, on an open account assigned to the plaintiff by The Carter Oil Company. A summons and complaint were served on the defendant in Hettinger County on May 26, 1958. Although not made a part of the judgment roll on this appeal, the parties agree that on July 17, 1958, the plaintiff also served a garnishment summons on the defendant and the garnishee named therein. On July 26, 1958, the defendant's attorney forwarded by mail to the plaintiff's attorney a demand for a change of venue, supported by the defendant's affidavit averring his residence as Hettinger County, and demanding that venue be changed to the District Court of Hettinger County, Sixth Judicial District. A stipulation for change of venue, prepared for the signature of the attorneys for both parties and signed by the attorney for defendant, was enclosed. An admission of service was enclosed also. The attorney for the plaintiff refused to sign the stipulation, and he did not admit service. He returned the papers to the defendant's attorney on July 29, 1958, stating they were not timely because the time for answering the complaint had expired. On August 2, 1958, the attorney for the defendant executed an affidavit of service by mail, and on the same day prepared an instrument entitled 'Answer and Motion for Order Changing Venue' which was served upon the attorney for the plaintiff by mail. The demand for change of venue and affidavit for change of venue and proof of service were then forwarded by defendant's attorney to the judge of the Stutsman County Court with a request that they be filed in the case. He also advised the court that an answer to the complaint was being served the same day. The answer and motion for change of venue was prepared and served by mail. It sets forth a meritorious defense. On August 4, 1958, the judge of the County Court of Stutsman County wrote to the attorney for the defendant acknowledging receipt of the papers, and in his letter advised that the case had not been filed and therefore the papers could not be filed. He stated in part, 'In view of what you are doing, I believe no papers in this case will be filed and in the event any are filed I shall not sign order for judgment until you are notified.' On August 28, 1958, the plaintiff's attorney filed the case in the Stutsman County Court, and also presented his affidavit of default, affidavit of proof, and affidavit of nonmilitary service. On the same day the court entered its findings of fact and conclusions of law, and ordered judgment against the defendant for the amount of $459.56, plus costs. An affidavit of costs was filed, and on the same day a judgment by default was entered by the clerk of said Stutsman County Court against the defendant for a total of $472.66.

Thereafter, on March 24, 1965, an application was made to the County Court to vacate the said judgment on the ground that the statements contained in the affidavit of default were incorrect for the reason that an answer had been served, that there was an appearance made by or on behalf of the defendant, and that the defendant had a good and valid defense to the whole claim made against him because the said claim had been paid before the commencement of the action. Such application also alleged that the entry of judgment was not discovered by the defendant until the late fall of 1964. The court issued its order directed to the plaintiff to show cause why the judgment should not be vacated. Following a hearing on April 7, 1965, the County Court of Stutsman County entered its order on April 13, 1965, from which this appeal is taken. The order adjudges and decrees that the default judgment entered on August 28, 1958, is void and without force or effect. It vacates the judgment, and enjoins the plaintiff perpetually from in any manner enforcing or attempting to enforce the judgment.

The plaintiff specifies that the court erred in holding a hearing on April 7, 1965, to consider the question of vacating a judgment entered on August 28, 1958, and that it erred in vacating the judgment.

A summons and complaint, regular in form, were served upon the defendant by a deputy sheriff on May 26, 1958. Thereafter the defendant had 20 days in which to answer the complaint. Rule 12, N.D.R.Civ.P. Time for answer expired on June 15, 1958, but the defendant had taken no action, had not appeared in the case, and was in default. On July 17, 1958, the plaintiff prepared and served a garnishment summons, and thereafter, on July 26, 1958, the defendant made his first appearance in the action by filing an application and demand for change of venue to the county of his residence. A demand for change of venue must be made before the time for answer expires. Section 28--04--06, N.D.C.C. It is clear the defendant made no demand for change of venue, nor did he otherwise appear in the action, before the time for answering had expired. The plaintiff could have moved for a default judgment before the garnishment summons was served. The defendant made no request or application for an extension of time in which to plead to the complaint nor to demand a change of venue, nor is any excuse now given or offered for this failure.

Rule 55, of the North Dakota Rules of Civil Procedure, provides the procedure for obtaining a default judgment. Section (a) states:

(a) Entry. When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise appear and the fact is made to appear by affidavit or otherwise, the court may direct the clerk to enter an appropriate judgment by default in favor of the plaintiff and against the defendant as follows:

(1) When the plaintiff's claim against a defendant is for a sum certain or for a sum which can by computation be made certain, the court, upon affidavit of the amount due and upon production of the written instrument, if any, upon which the claim is founded, may direct the entry of judgment.

(2) * * *

(3) * * * If the party against whom judgment by default is sought has appeared in the action, he * * * shall be served with written notice of the application for judgment at least eight days prior to the hearing on such application.

Plaintiff's claim against the defendant in this case is for a sum certain and it seeks affirmative relief. The defendant failed to plead or otherwise appear during the 20-day period provided for answering. The defendant was in default and plaintiff was entitled to apply for default judgment without notice to the defendant. However, before the plaintiff made application for a default judgment, the defendant served his answer and demand for a change of venue. The question arises whether the plaintiff's right to the entry of default judgment without notice was waived. In other words, does the provision of the Rule which reads 'If the party against whom judgment by default is sought has appeared in the action, he * * * shall be served with written notice of the application for judgment at least eight days prior to the hearing on such application' apply?

The defendant served an answer to the plaintiff's complaint on August 2, 1958, but plaintiff did not make application for a default judgment until August 28. Service of the answer constituted an...