Walters v. O'Keefe, 34

• Decision Date: 05 January 1966
• Docket Number: No. 34,34
• Parties: Margaret WALTERS and Clarence Walters, Plaintiffs and Appellants, v. Dennis J. O'KEEFE, Circuit Judge for the County of Arenac, 34th Judicial Circuit, Defendant and Appellee. *
• Court: Michigan Supreme Court

Page 751

138 N.W.2d 751

377 Mich. 37

Margaret WALTERS and Clarence Walters, Plaintiffs and Appellants, v. Dennis J. O'KEEFE, Circuit Judge for the County of Arenac, 34th Judicial Circuit, Defendant and Appellee.

^*

No. 34.

Supreme Court of Michigan.

Jan. 5, 1966.

Cicinelli, Mossner, Majoros & Harrigan, Saginaw, by Peter F. Cicinelli and Eugene D. Mossner, Saginaw, of counsel, for plaintiffs-appellants.

Moll, Desenberg, Purdy, Glover & Bayer, Detroit, for defendant and appellee.

Before the Entire Bench.

O'HARA, Justice.

This case is before us upon an order to show cause why a writ of superintending control in the nature of mandamus should not issue directing the circuit judge to reinstate a default entered by plaintiffs against a doctor of medicine, the named defendant in that action.

Plaintiffs began their action by issuance of summons on May 27, 1961. Defendant was personally served therewith on June 2, 1961. June 9 of that year, plaintiffs filed their declarations, and on June 30, defaulted defendant for failure to appear or file an answer.

The chronology thereafter becomes to a degree unclear and is the subject of dispute between plaintiffs' counsel and the attorneys who ultimately appeared for the defendant-doctor. We believe it may be fairly said from the record that plaintiffs' counsel made bona fide effort to obtain a day certain upon which to be heard and to introduce the proof in support of a default judgment. The time for this proceeding was finally fixed as December 12, 1961. Counsel confirmed the date by letter to the clerk of the circuit court.

On December 6, 1961, the attorneys later, to represent the defendant, received an Arenac term calendar by reason of other representation, which listed the actions pending against the defendant-doctor, and which showed him to be in default.

Defendant counsel, for reasons not relevant here, knew the insurer of the defendant-doctor and immediately communicated this information to that company. Investigation by the latter revealed that the summons had been misfiled. The day following the learning of the default, counsel entered an appearance for the doctor and the following day moved to set aside the default, supporting the motion with affidavits of merit. Answer thereto was made. In consequence of these pleadings, the December 12 hearing to take proofs on the judgment was not held. For reasons again not entirely clear in the record (save several agreed adjournments) the motion to set aside the default was not heard until May 20, 1963. An order setting aside defaults was entered July 15th following.

Plaintiffs appealed to this Court as of right. On December 2, 1963, we dismissed this appeal as then taken. Plaintiffs, in answering defendant's motion to dismiss asked (a) that the motion to dismiss be denied or (b) that the appeal taken of right be treated as an application for leave to appeal or (c) that a writ of superintending control issue directing the trial judge to vacate the order setting aside the original default. No opinion accompanied our dismissal of the appeal. On February 25, 1964, plaintiffs filed a direct application for superintending control. We granted an order to show cause. The circuit judge made his return, and the question for consideration is the grant or denial of the motion to vacate his order setting aside the default.

Appellee contends, first, that our 'rejection' of the request for a writ of superintending control when it was sought alternatively in the answer to the motion to dismiss the appeal is conclusive, and that the correctness of the order vacating the default is res judicata.

Our dismissal of the improperly taken appeal of right was not an adjudication of the question of the grant or denial of right of review. Neither was it an adjudication on the merits of the application for superintending control as alternatively sought with the petition to consider the appeal taken as an application for leave to appeal. Our order of dismissal of the appeal of right, without elaboration, adjudicated only that no appeal of right lay from the interlocutory order vacating the default. In Great Lakes Realty Corporation v. Peters, 336 Mich. 325, 57 N.W.2d 901, we affirmed our holding in Malooly v. York Heating & Ventilating Corp., 270 Mich. 240, 258 N.W. 622, that denial of an application for leave to appeal an interlocutory order does not foreclose litigants from ultimate review of the propriety of the challenged order. Analogously neither did our mere grant, without more, of the motion to dismiss the appeal here taken as of right, foreclose our review of the circuit judge's order vacating the defaults, either by leave to appeal granted, or upon petition for superintending control.

Appellants urge in their first stated question that the grounds for failure to appear, the misfiling of the summons after service on the insured and delivery by him to the insurer, is not good cause for setting aside the default regularly entered. Secondly, they contend that assuming no abuse of discretion, the Court was without jurisdiction to set aside the default after the 4-month period specified by former Mich. Court Rule No. 28, § 4 (1945). ¹

We discuss the questions in inverse order.

The circuit judge expressly held:

'The right to set aside a default judgment seems to rest upon the interpretation of Court Rule 28, § 1 through 4, with section 4 of said rule being applicable in this case, * * *.' (Emphasis supplied.)

In this holding we believe the able trial judge was in error. This case is not concerned with setting aside a default judgment.i. No judgment had been entered. What is involved here was setting aside an order of default. This is procedural and is controlled by the practice, as prescribed, as of the time the judicial action is taken. The circuit judge's order was entered July 15, 1963 and rests upon GCR 520 of 1963, as affected by GCR 528, 1963, both effective January 1, 1963. The trial court held the former and present rules to be substantially the same. We expressly refrain from passing on this point because it is not decisionally involved. For this reason, we also refrain from reexamining Cleveland, Cincinnati, Chicago & St. Louis Railway Co. v. Berrien Circuit Judge, 187 Mich. 444, 153 N.W. 798. We do note, however, that the documented dissent seems more considered than the conclusionary majority holding.

The applicable subsection of the present rule reads: ²

'Setting Aside Default. For 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 528. If personal service was made upon the party against whom the default was taken, it shall not be set aside unless application to have it set aside is made either before the entry of judgment or within 4 months after the default was regularly filed or entered except as provided in Rule 528. Any order setting aside such default shall be conditioned upon the party against whom the default was taken paying the taxable costs incurred by the other party in reliance upon the default, except as prescribed in subrule 526.8. Other conditions may be imposed as the court deems proper. A proceeding to set aside default or a default judgment, except when grounded on want of jurisdiction over the defendant, shall be granted only if good cause is shown and an affidavit of facts showing a meritorious defense is filed.'

The first clause of the first sentence is what we must initially consider. It provides unequivocally that for 'good cause' shown the court, in its discretion, may set aside any entry of default. This general grant of discretionary power in relation to a default (and we are not here considering a default judgment) is limited by the following restrictive language:

'If personal service was made upon the party against whom the default was taken, it shall not be set aside unless application to have it set aside is made either before the entry of judgment or within 4 months after the default was regularly filed or entered * * *.' (Emphasis supplied.)

We do not here consider, nor undertake to pass upon, the situation where personal service has not been made upon the party against whom the default was taken. Thus in this case where personal service was made, the power of the court to set aside the default is dependent upon existence of one of the 2 conditions precedent set out in the rule. Absent one or the other of those conditions, the language of the rule is unequivocal, 'it [the default] shall not be set aside.' No question here arises that the application to have the default set aside was made within the requisite 4 months. However, the application was made 'before the entry of judgment,' and the court was empowered to set it aside. Thus the question is 'was good cause shown.' This must be determined from the affidavits of merit filed in support of the motion to set aside the default and the counter-affidavits.

Three affidavits were filed in support of the motion to vacate the default--one by an attorney in the firm which later filed the doctor's appearance and answer; one by an employee of the doctor's insurer, and one by the doctor himself. The attorney's affidavit could hardly be expected to establish good cause. It recites in simple substance that once, he, the attorney, learned the doctor had been defaulted, he, the attorney, acted with all promptitude and that in his, the attorney's opinion the doctor had a meritorious defense. The first ground is after the fact and irrelevant. The diligent counsel could have done nothing prior to the fortuitous receipt of the term calendar. It is well settled in this jurisdiction that the negligence of either the attorney or the litigant is not normally grounds for setting aside a default regularly entered. See White v. Sadler, 350 Mich. 511 (522), 87 N.W.2d 192, and cases therein cited. There is no negligence of an attorney...