Commercial Savings & Loan Ass'n v. Holly Development, Inc.

154 N.W.2d 510, 182 Neb. 335, 1967 Neb. LEXIS 504
CourtNebraska Supreme Court
DecidedDecember 1, 1967
Docket36670
StatusPublished
Cited by10 cases

This text of 154 N.W.2d 510 (Commercial Savings & Loan Ass'n v. Holly Development, Inc.) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Commercial Savings & Loan Ass'n v. Holly Development, Inc., 154 N.W.2d 510, 182 Neb. 335, 1967 Neb. LEXIS 504 (Neb. 1967).

Opinion

Cartes, J.

This is an appeal from an order of the district court for Douglas County refusing to set aside a default judgment to permit certain defendants to file an answer and defend- on the merits.

The action was begun by Commercial Savings and Loan Association to foreclose a mortgage on a residence property described as 4941 Bro-wne Street. Merrill Goff and Dorothy P. Goff were made parties defendant to the action. They- were husband and wife. A summons was served personally on Merrill Goff and on Dorothy P. Goff by leaving a certified copy at her usual place of residence. On Februáry 7, 1967, a decree of foreclosure Was entered, the default -of the Goffs being noted in the decree. - On March 28, 1967, the defendants Goff filed sin application to set aside the default judgment taken against theth, attaching thereto the answer they proposed, to file, if the decree was set aside.

.....The evidence shows that the Goffs purchased the residence; at' 4941 Browne .Street on May 8, 1959, from Holly Development, Inc:,"of'which Ernest J. Banse -and *337 Joanne M. Banse were the president and secretary, respectively. Joanne M. Banse was the daughter of Dorothy P. Goff and Ernest J. Banse was the husband of Joanne M. Banse and the son-in-law of Dorothy P. Goff. Banse delivered the deed from Holly Development, Inc., to the Goffs and at the same time requested the Goffs to sign numerous documents allegedly connected with the transaction. The Goffs, trusting Banse, signed the documents. Without their knowledge, they signed a deed, bearing the same date as the Holly Development, Inc., deed, conveying the residence to Banse and his wife in joint tenancy. The notary who acknowledged the deed signed by the Goffs testified that she knew the relationship of the Goffs to Banse but had never met them. At the' instance of Banse, her employer, she placed her signature and notarial seal on the acknowledgment of the deed outside of their presence.

The evidence shows that Banse was to make the payments to Commercial Savings and Loan Association on its first mortgage lien. The Goffs paid Banse $150 per month, monthly checks in such' amount for the period May 1961 to June 1966 are shown by the record. The Goffs moved into the property in May'1959 and remained until July 1, 1966, after which they resided at 5021 North Fiftieth Street. On December 15, 1965, the Banses sold the house and delivered a deed to Edward J. Epsen and Michael McCormack for a consideration of $6,000.

On September 29, 1966, the Commercial Savings and Loan Association filed its petition to foreclose its first mortgage lien and on the same day a summons was issued. On October 4, 1966, Dorothy P. Goff was served With summons by leaving a certified copy at her usual place of residence. On November 21, 1966, an alias summons was served personally on Merrill Goff. Mrs. Goff testified that she did not receive the copy of the summons left at her usual place of residence and infers with considerable -reason that the summons was taken and retáined by Banse who was at that time residing with *338 the Goffs. On November 21, 1966, or the day following, Merrill Goff discussed his summons with Mrs. Goff and, being concerned, they questioned Banse about the matter. Banse informed them that it was a mistake and he would have August Ross, an attorney, look after their interests. He purported to telephone Ross in their presence. This call proved to be a false one, Ross testifying that he did not talk with Banse by telephone and that he was never requested by anyone to represent the Goffs. It is plain, however, that both of the Goffs knew of the pendency of the action on November 22, 1966, long before the default decree was taken against them. Banse subsequently departed Omaha without leaving a forwarding address. The record bears out the conclusion that Banse was not a man of integrity and was completely untrustworthy. The Goffs understood this, which is borne out by the fact that Mrs. Goff consulted a lawyer about it in August 1966. The Goffs moved out of the house at 4941 Browne Street on July 1, 1966, and into1 a residence at 5021 North Fiftieth Street. Mrs. Goff testified that Banse had agreed to sell the house at 4941 Browne Street and use the proceeds to reduce the cost of the house at 5021 North Fiftieth Street. The evidence further shows that on August 2, 1966, Michael McCormack and Thomas Ryder of the county attorney’s office called on Mrs. Goff, showed her the deed from the Goffs to the Banses dated May 8, 1959, and asked her if the signatures were those of herself and her husband. She said: “ ‘They are ours.’ ” She raised no question as to the validity of the deed and by her silence lulled McCormack into a sense of security.

The evidence reflects that the Goffs knew that Banse was untrustworthy long before the default decree was taken. Mrs. Goff knew that the legal title to the 4941 Browne Street property was in the name of the Banses in August 1966, according to her own admission. When questioned about the signatures of herself and husband, she admitted the validity of the signatures and raised ,no *339 question of fraud or deceit. She admitted that Banse was to sell the house and apply the proceeds on the¡ home subsequently purchased, and the Goffs moved from the house without asserting any claim of ownership in them. It is true they were the victims of a misplaced trust in their son-in-law, Banse, but on discovery of his unwarranted conduct, they did nothing until the house was advertised for sale by decree of the court. Their extreme negligence forecloses any right to have the decree set aside. There is no evidence whatever that other parties to the suit in any way contributed to the difficulties of the Goffs. The purchasers from Banse paid $6,000 for the house in good faith without objection by the Goff's although opportunity to object was afforded. The failure of the Goffs to answer and assert any rights they may have had was the result of their own negligence and theirs alone.

The vacation of a default judgment rests in the discretion of the district court. The burden rests on the person adversely affected by the court’s order to affirmatively establish an abuse of such discretion. In the early case of Orr v. Seaton, 1 Neb. 105, this court said: “Whether a default shall be opened, is a question addressed to the discretion of the court. The Supreme Court will not interfere with its exercise, unless it is oppressive.”

“A court of equity will not grant relief against a judgment taken by default where the applicant, shown to have been duly served with summons, failed to avail himself of an opportunity to defend, such failure not being the result of fraud, accident, mistake, or the like. * * * Where a judgment by default is obtained against a party by his own neglect, it constitutes no ground for equitable intervention that his adversary obtained more relief than he was entitled to.” 49 C. J. S., Judgments, § 348, p. 703.

“The general rule is that one who seeks to set aside a default judgment against him must show that neither he nor his attorney was negligent in failing to appear *340 and defend the suit.

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Bluebook (online)
154 N.W.2d 510, 182 Neb. 335, 1967 Neb. LEXIS 504, Counsel Stack Legal Research, https://law.counselstack.com/opinion/commercial-savings-loan-assn-v-holly-development-inc-neb-1967.