Bethlehem Steel Corp. v. U. S. Metal Plastics, Inc.

265 F. Supp. 535, 1967 U.S. Dist. LEXIS 8472
CourtDistrict Court, D. Maryland
DecidedMarch 13, 1967
DocketCiv. A. No. 16016
StatusPublished
Cited by2 cases

This text of 265 F. Supp. 535 (Bethlehem Steel Corp. v. U. S. Metal Plastics, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bethlehem Steel Corp. v. U. S. Metal Plastics, Inc., 265 F. Supp. 535, 1967 U.S. Dist. LEXIS 8472 (D. Md. 1967).

Opinion

NORTHROP, District Judge.

A motion for partial summary judgment against Malcolm B. Devers was

granted by the court on October 14, 1966, over the opposition of that defendant’s counsel.

Cary M. Euwer and Wallace L. Schubert, counsel appearing in the action for the first time in behalf of Malcolm Devers, now move to rescind the order of this court granting summary judgment in favor of the plaintiff, Bethlehem Steel, since there was no service of process on defendant Devers in accordance with Rule 4(d) (1) of the Federal Rules of Civil Procedure and because attorney J. Ambrose Kiley was never authorized by Devers to enter an appearance in his behalf. They urge that this court had no jurisdiction over Devers. Bethlehem Steel opposes the motion because Mr. Kiley entered a general appearance for Devers. Plaintiff contends that Devers waived his right to contest personal jurisdiction under Rule 12(h) of the Federal Rules of Civil Procedure.

This court heard the motion of Messrs. Euwer and Schubert appearing in behalf of Devers on December 16, 1966. On that date both J. Ambrose Kiley and Wallace L. Schubert testified. No correspondence between these gentlemen, however, was produced to support their testimony. Likewise, they produced no affidavit from Devers nor requested that Devers be deposed or be allowed to appear specially for this hearing. Rather, counsel wished to proceed on the basis of the court file and their testimony at the hearing.1 Mr. Schubert testified that the defendant corporation, U. S. Metal Plastics, Inc., and the individual defendants were his clients. Because he did not practice in Maryland, he had referred the matter at hand to Mr. Kiley, whom he was [537]*537.accustomed to retain for Maryland matters. He testified that he told Mr. Kiley to answer for those defendants who had been served. Prior to this particular action he had referred a U. S. Metal Plastics case, which was pending in the Circuit Court for Prince Georges County, to Mr. Kiley. Devers participated in those proceedings. This was corroborated by Mr. Kiley, who testified as he had declared when the motion was granted on October 14, 1966, i. e., that he had mistakenly understood the referral to carry representation of all defendants named in the complaint.

The bill of complaint before the court .alleging, inter alia, that U. S. Metal Plastics, Inc., a Maryland corporation, had been dissolved and that the directors were being sued as trustees of the dissolved corporation, was filed December 8, 1964. Service was had on the corporation by serving Werner Westermann personally at Laurel, Maryland, and Louise Westermann through her husband. Malcolm B. Devers, whom the marshal attempted to serve personally at the Laurel address, was noted to be “out of town”. Ralph Srour was also not served. There was a second attempt to serve both Devers and Srour on January 20, 1965. The summons and complaint were again returned unexecuted. No further attempt was made to serve these people because on January 18, 1965, J. Ambrose Kiley had answered for all the defendants generally. As to defendant Ralph Srour, Mr. Kiley answered alleging that he had had no connection with the corporation for the past two years.

On March 5, 1965, plaintiff filed interrogatories going to all defendants. On April 7, 1965, the interrogatories were answered on behalf of all defendants, but only signed for U. S. Metal Plasties by Werner Westermann as vice president, by Werner Westermann, individually, and by Louise S. Westermann, individually. Devers did not sign the answer and his name was stricken on the jurat by the Virginia notary before whom the oath was taken.

On April 28, 1965, a motion for partial summary judgment was filed against U. S. Metal Plasties and all of the individual defendants except Srour.

On May 11, 1965, Mr. Kiley, on behalf of all defendants including Srour, filed opposition to this motion for partial summary judgment. He conceded that U. S. Metal Plastics could not oppose the motion. As to the individual defendants, it was alleged that the charter of the corporate defendant, U. S. Metal Plastics, which had been forfeited, had later been revived.

On October 19, 1965, there being no hearing requested in accordance with this court’s Rule 7, the court granted summary judgment against the corporation and denied it as to the individual defendants.

On December 27, 1965, a fieri facias upon that judgment against U. S. Metal Plastics, Inc., was issued.

On December 29, 1965, the writ was returned “unexecuted”.

On March 17, 1966, a motion to amend the complaint was filed, the pertinent part of which read as follows:

“On January 10, 1958, Defendant Malcolm B. Devers, in order to induce the Plaintiff to sell and deliver goods to the corporate defendant, executed an absolute guaranty of all debts of U. S. Metal Plastics, Inc., to the Plaintiff.”

On April 29, 1966, there being no opposition to the motion for leave to amend the complaint, this court ordered the clerk to receive the amended complaint; on April 29, 1966, the amended complaint was filed. Paragraph 7 of the Amended Complaint reads:

“On January 10, 1958, Defendant Malcolm B. Devers executed an unconditional personal guaranty whereby he guaranteed to the Plaintiff the prompt and full payment of all invoices rendered by the Plaintiff to the Defendant U. S. Metal Plastics, Inc., for any materials and/or services furnished by Bethlehem to Defendant U. S. Metal Plastics, as more fully set out in said [538]*538guaranty, a copy of which is attached hereto as Exhibit A.”

The copy of the guaranty is apparently signed by Devers, individually, and sworn to before a notary for the State of Virginia. It is also confirmed by Devers as President of U. S. Metal Plastics, Inc.

On May 16, 1966, Mr. Kiley on behalf of all defendants answered each paragraph of the amended bill of complaint.

In Paragraph 1 of that answer, he avers that all defendants admit the jurisdiction of this court. Paragraph 7 contains the following allegation:

“Answering paragraph 7 of the amended complaint, defendant Devers admits the execution of the guaranty as alleged.”

On July 14, 1966, a motion for partial summary judgment against Devers on the guaranty was filed. On August 9, 1966, twenty months after the commencement of this suit, Mr. Kiley filed opposition to that motion alleging that

“there is a real and genuine dispute concerning said individual defendant’s [Devers’] responsibility on the alleged unconditional personal guaranty and refers to the attached affidavit.”

The affidavit of J. Ambrose Kiley sets forth in its pertinent part that:

1. He was retained to represent only the defendants served with process;

2. Devers was never served with process in his individual capacity;

3. “Through inadvertence, ' mistake and a marked degree of carelessness” on his [Mr. Kiley’s] part an answer including Devers was filed to the original bill of complaint;

4.

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Related

EF Hutton & Company v. Brown
305 F. Supp. 371 (S.D. Texas, 1969)
Bethlehem Steel Corporation v. Malcolm B. Devers
389 F.2d 44 (Fourth Circuit, 1968)

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Bluebook (online)
265 F. Supp. 535, 1967 U.S. Dist. LEXIS 8472, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bethlehem-steel-corp-v-u-s-metal-plastics-inc-mdd-1967.