CMS JONESBORD REHABILITATION, INC. v. Lamb

812 S.W.2d 472, 306 Ark. 216, 1991 Ark. LEXIS 362
CourtSupreme Court of Arkansas
DecidedJuly 1, 1991
Docket91-70
StatusPublished
Cited by20 cases

This text of 812 S.W.2d 472 (CMS JONESBORD REHABILITATION, INC. v. Lamb) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
CMS JONESBORD REHABILITATION, INC. v. Lamb, 812 S.W.2d 472, 306 Ark. 216, 1991 Ark. LEXIS 362 (Ark. 1991).

Opinions

Robert L. Brown, Justice.

This appeal arises from a default judgment entered against the appellant, CMS Jonesboro Rehabilitation, Inc. d/b/a Northeast Arkansas Rehabilitation Hospital, Inc. (“CMS”), and in favor of the appellees, Boyd Lamb and Delores Lamb, in the amount of $23,572.75. CMS advances the arguments that the service was defective and, alternatively, that the failure of CMS to answer was due to excusable neglect and unavoidable casualty or misfortune.

We do not agree, and we affirm the judgment.

The appellees filed their complaint against CMS and its parent company, Continental Medical Systems, Inc. (“Continental”), on July 25, 1989, alleging damages to the appellees’ residence caused by a dirt-pounding process associated with the construction of a CMS facility that sent shock waves and vibrations to the appellees’ property. The appellees sought to serve CMS by serving its agent, The Corporation Company, with complaint and summons on July 25, 1989, by certified mail, return receipt requested. The receipt was signed by R.L. Wright on the “Signature-Agent” line on July 28, 1989. Under the category on the receipt entitled “Type of Service,” the “Certified” box was marked with an “x.” No check or mark of any kind was made in the “Restricted Delivery” box on the receipt. At the time of service a Standing Delivery Order form was on file with the U.S. Postal Service showing that R.L. Wright was an authorized agent of The Corporation Company to receive unrestricted and restricted delivery mail. After receiving the complaint and summons, The Corporation Company forwarded the same to CMS.

Approximately four and one-half months after the certified mail receipt was signed, and specifically on December 11, 1989, the appellees took a default judgment against CMS and Continental in the amount of $23,572.25. CMS and Continental did not discover the default judgment until April 25, 1990, and moved to set it aside on May 3, 1990. The trial court reviewed affidavits submitted by the parties and evidentiary depositions and heard testimony from a witness and arguments of counsel at a hearing on August 15, 1990. By order entered on August 17, 1990, the trial court denied the motion to set aside with regard to CMS but granted it with regard to Continental, due to lack of in personam jurisdiction.

CMS argues, first, that service of process by the appellees did not satisfy the dictates of Ark. Rule Civ. P. 4(d) (8) (A), which authorizes service of summons and complaint by mail:

Service of a summons and complaint upon a defendant . . . may be made by the plaintiff or an attorney of record for the plaintiff by any form of mail addressed to the person to be served with a return receipt requested and delivery restricted to the addressee or the agent of the addressee. Service pursuant to this paragraph shall not be the basis for the entry of a default or judgment by default unless the record contains a return receipt signed by the addressee or the agent of the addressee or a returned envelope, postal document or affidavit by a postal employee reciting or showing refusal of the process by the addressee.

Ark. R. Civ. P. § 4(d)(8)(A). In the case before us, the mail was appropriately addressed to The Corporation Company, which was the registered agent of CMS, with a return receipt requested. A receipt signed by R.L. Wright on behalf of The Corporation Company is also in the record. These facts are not in dispute.

CMS’s argument, however, centers on whether the mailing by the appellees was a “delivery restricted” to The Corporation Company under Rule 4(d)(8)(A). We hold that it was. It is true that the Restricted Delivery box was not checked on the U.S. Postal Service form. Nevertheless, the procedure followed by the postal service and The Corporation Company was the designated procedure under Rule 4(d)(8)(A) had the box been checked: a person authorized to accept restricted mail did so and signed the required receipt which was returned to the appellees and is now part of the record.

It is undisputed that R.L. Wright was authorized to accept restricted mail on behalf of The Corporation Company. Evidencing this fact was the card on file with the postal authorities at the time which was signed by Wright and which contained the added notation: “This authorization is extended to include Restricted Delivery.” Furthermore, Wright signed for and accepted the mail containing the complaint and summons, the same as he would have done had the “Restricted Delivery” box been marked. Under such facts it would strain credulity to hold that the delivery was not, in fact, carried out in restricted fashion and that the purposes and objectives of Rule 4(d)(8)(A) were not, in fact, met.

We particularly note the language in Rule 4(d)(8)(A) which provides when service can be the basis for a default judgment. The rule states that a default judgment shall not be entered “unless the record contains a return receipt signed by the addressee or the agent of the addressee.” That is exactly what was done in this case—a return receipt signed by the appropriate person, R.L. Wright, on behalf of The Corporation Company was made part of the record. The object of the rule is to give CMS knowledge of the appellees’s suit, and that object has clearly been met. For reasons unrelated to service of process, CMS simply failed to respond to the complaint.

In its argument CMS relies heavily on a prior case of this court handed down in 1989 which had somewhat similar facts. See Wilburn v. Keenan Companies, Inc., 298 Ark. 461, 768 S.W.2d 531 (1989). In Wilburn the trial court also refused to set aside a default judgment where service of complaint and summons was by certified mail, return receipt requested, but where the “Restricted Delivery” box was not marked. However, in Wilburn, the person who received the certified mail with the complaint and summons was not authorized by the defendant to receive restricted delivery in accordance with U.S. Postal Service regulations. We reversed the trial court and voided the default judgment. In our decision we referred to both the failure to mark the “Restricted Delivery” box and the recipient who was not authorized to receive restricted mail:

There was no evidence that appellee had directed the summons and complaint to be mailed with restricted delivery. Nor was there any evidence that appellant had specifically authorized, in writing, that L.D. Madden was to be his agent to receive mail. Consequently, the default judgment was void ab initio, and the trial court erred in denying appellant’s motion to set it aside.

298 Ark. at 463; 768 S.W.2d at 532.

The facts in this case are distinguishable from the Wilburn case. Delivery was made in this case as if the “Restricted Delivery” box had been marked. Moreover, in this case R.L. Wright was clearly authorized by The Corporation Company to receive restricted deliveries.

CMS next argues that R.L. Wright could not accept service for The Corporation Company under Ark. R. Civ, P.

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CMS JONESBORD REHABILITATION, INC. v. Lamb
812 S.W.2d 472 (Supreme Court of Arkansas, 1991)

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Bluebook (online)
812 S.W.2d 472, 306 Ark. 216, 1991 Ark. LEXIS 362, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cms-jonesbord-rehabilitation-inc-v-lamb-ark-1991.