Gordon Huncilman v. Jeremy Voyles Marine Repair, LLC, and Jeremy Voyles (mem. dec.)

• Court: Indiana Court of Appeals
• Decided: April 23, 2019
• Docket: 18A-CT-1958
• Status: Published

Opinion

MEMORANDUM DECISION

Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision shall not be FILED regarded as precedent or cited before any Apr 23 2019, 9:06 am

court except for the purpose of establishing CLERK the defense of res judicata, collateral Indiana Supreme Court Court of Appeals and Tax Court estoppel, or the law of the case.

ATTORNEY FOR APPELLANT Matthew J. McGovern Anderson, Indiana

IN THE COURT OF APPEALS OF INDIANA

Gordon Huncilman, April 23, 2019 Appellant-Plaintiff, Court of Appeals Case No. 18A-CT-1958 v. Appeal from the Clark Circuit Court Jeremy Voyles Marine Repair, The Honorable Andrew Adams, LLC, and Jeremy Voyles, Judge Appellees-Defendants. Trial Court Cause No. 10C01-1701-CT-4

Mathias, Judge.

[1] Gordon Huncilman (“Huncilman”) appeals the Clark Circuit Court’s setting

aside of default judgment against Jeremy Voyles Marine Repair, LLC, and

Jeremy Voyles (collectively, “Voyles”) arguing that there is no evidence of

excusable neglect.

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 1 of 11 [2] We reverse.

Facts and Procedural History [3] In late 2015, Gordon Huncilman (“Huncilman”) met with Voyles about

potentially hiring Voyles to paint his houseboat. Voyles told Huncilman that he

wanted to use Awlgrip brand paint on the boat, and the two agreed that the

work would be done in time for the boat to be launched in April or May of

2016. Huncilman understood that the storage facility was strict with the hours it

would allow Voyles to perform the necessary work, only allowing him to work

between 7:30 a.m. and 3:30 p.m.

[4] Huncilman testified that Voyles started the work on time, but there were large

lapses of time between work. Huncilman also saw that Voyles had been

working on another project at the same storage facility, but not on his boat. He

also observed a lot of problems with sags and runs in the paint. Huncilman did

not believe that Voyles properly prepared the boat; silicone around the windows

was painted over, and glue from decals had not been removed. When

Huncilman spoke to Voyles about these issues, Voyles indicated to him that he

would not repair or finish the boat. Voyles testified that he did the same

application on Huncilman’s boat that he does on hundreds of boats. He said

with this particular application, another individual “down there” turned the air

hoses off several times during application and that it splattered on the side of

the boat. Tr. p. 45. He also testified that on another occasion, he had the stripes

completely painted on one side, and someone else started a table saw and blew

saw dust onto the brand new paint. After this, he re-painted the boat; however, Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 2 of 11 Huncilman had a company removing carpet glue, and that company splattered

gasoline all over the fresh paint on the back of the boat. Voyles testified that he

addressed these issues with Huncilman, telling him that he could not travel this

far to do this job with these sorts of mishaps with other companies. Huncilman

testified that he had several appointments set up with Voyles, but that Voyles

never showed and did not respond to his texts. Huncilman began interviewing

other painters to paint the boat. Huncilman also spoke with the paint

manufacturer and secured their technical bulletin. After reviewing the technical

bulletin, he felt it was “obvious” that the technical specifications had not been

followed. Tr. p. 54. Because of the defects with the paint, he had the boat

stripped and repainted.

[5] Voyles and Huncilman initially agreed upon a price of $10,000 for the painting

work to be completed by April or May of 2016. Huncilman made two payments

to Voyles, one for $3,250 and the other for $4,000. When the painting work was

not completed after the passage of some time, Huncilman asked Voyles if he

needed to pay additional money. Voyles asked for an additional $1,800, and

Huncilman agreed to pay the additional amount upon completion. Huncilman

paid Voyles and the contractor who ultimately completed the work a total of

$67,614.39. The difference between Voyles’s initial quote to Huncilman and the

amount he ultimately paid was $55,814.39

[6] Huncilman initiated this matter against Voyles seeking monetary damages. The

complaint and summons were addressed to Voyles at 3132 Utica Pike in

Jeffersonville, Indiana. However, Voyles’s business address is actually 3732

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 3 of 11 Utica Pike. When the complaint and summons were initially served, a law

enforcement officer recognized the error in the address and served the copy on

Voyles personally. After receiving the complaint, Voyles reached out to the

attorney who was representing him in another matter, Richard Rush (“Rush”).

Rush advised Voyles that he could not formally represent Voyles because of the

potential for conflict; however, he did offer to assist Voyles with informally

working the matter out with Huncilman. Rush then arranged a meeting

between Voyles, Huncilman, and Huncilman’s counsel. Huncilman, his

counsel, and Rush proposed an amount to Voyles; however, Voyles did not like

the amount in the tentative agreement and refused to sign the settlement

paperwork. Rush never entered an appearance in the matter.

[7] After Voyles refused to sign the agreement, Rush sent him a letter stating

We have spoken several times and have communicated via text message regarding the above matter. As you know, you have been sued by Gordon Huncilman. You have not filed an Answer and your deadline to file one has passed. The Agreed Judgment I assisted you in negotiating still has not been signed and [Huncilman’s counsel] has indicated he will be filing for a default judgment sometime next week. Under the trial rules, he would be eligible for that to be entered immediately. As you recall, I initially told you I would not represent you in this matter because of a potential conflict of interest. I have been involved thus far because it appeared there was an amicable resolution that wouldn’t pose a conflict. It is imperative that you file an Answer to the suit immediately or deliver the signed Agreed Judgment to me or to [Huncilman’s counsel] directly. I am sending a copy of this letter to [Huncilman’s counsel] so that he is aware that I have notified you of your rights and obligations. Should you have any questions, please do not hesitate to contact me. Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 4 of 11 Ex. Vol., Petitioner’s Ex. 1. This letter is dated March 3, 2016. Rush testified

that the date of 2016 was a typographical error and he sent the letter in 2017.

Rush also testified that he had at least one conversation with Voyles regarding

this letter before the motion for default judgment was filed. Voyles testified that

he never received any pleadings or other paperwork regarding the matter other

than the initial complaint and summons. On March 17, 2017, Huncilman

moved for default judgment. On March 30, 2017, the trial court set a damages

hearing, and Voyles did not appear. On June 12, 2017, the trial court entered

default judgment against Voyles in the amount of $55,814.39 plus costs and

statutory interest.

[8] Voyles later learned of the default judgment against him when his father called

him and told him he had seen the award of money for Huncilman on the

internet. On January 16, 2018, Voyles, through new counsel, filed an answer to

the complaint and a motion to set aside the default judgment. The trial court set

a hearing on this motion for February 13, 2018. This hearing was then

continued to July 11, 2018. At the hearing on Voyles’s motion to set aside the

default judgment, Voyles testified he believed that he did not need to file a

formal response to the complaint because Rush was assisting him with an

informal resolution. After this hearing, the trial court set aside the default

judgment. Huncilman now appeals the order setting aside default judgment.

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 5 of 11 Discussion and Decision

[9] Once entered, a default judgment may be set aside because of mistake, surprise,

or excusable neglect so long as the motion to set aside the default is entered not

more than one year after the judgment and the moving party also alleges a

meritorious claim or defense. Ind. Trial Rules 55(C), 60(B). Indiana Trial Rule

60(B)(8) allows the setting aside of default judgment for “any reason justifying

relief from the operation of the judgment, other than those reasons set forth in

sub-paragraphs (1), (2), (3), and (4). When deciding whether or not a default

judgment may be set aside because of excusable neglect, the trial court must

consider the unique factual background of each case because “[n]o fixed rules

or standards have been established as the circumstances of no two cases are

alike.” Siebert Oxidermo, Inc. v. Shields, 446 N.E.2d 332, 340 (Ind. 1983) (quoting

Grecco v. Campbell, 179 Ind. App. 530, 532, 386 N.E.2d 960, 961 (1979)).

Indiana law strongly prefers disposition of cases on their merits. State v. Van

Keppel, 583 N.E.2d 161, 162 (Ind. Ct. App. 1991), trans. denied. Though the trial

court should use its discretion to do what is “just” in light of the facts of

individual cases, that discretion should be exercised in light of the disfavor in

which default judgments are held. Allstate Ins. Co. v. Watson, 747 N.E.2d 545,

547 (Ind. 2001).

[10] A ruling denying or granting relief on a motion to set aside a default judgment

is entitled to deference and is reviewed for abuse of discretion. Id. A trial court

will not be found to have abused its discretion “so long as there exists even

slight evidence of excusable neglect.” Security Bank & Trust Co. v. Citizens Nat’l

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 6 of 11 Bank, 533 N.E.2d 1245, 1247 (Ind. Ct. App. 1989). An appellee who does not

respond to the appellant’s allegations of error on appeal runs a considerable risk

of reversal. O.S. v. J.M., 436 N.E.2d 871, 872 (Ind. Ct. App. 1982). Where an

appellee has not filed a brief on appeal, the appellant’s brief need only

demonstrate prima facie reversible error in order to justify a reversal. Id. “Prima

facie, in this context, means at first sight, on first appearance, or on the face of

it.” WindGate Properties, LLC v. Sanders, 93 N.E.3d 809, 813 (Ind. Ct. App.

2018). “This standard, however, ‘does not relieve us of our obligation to

correctly apply the law to the facts in the record in order to determine whether

reversal is required.’” Id. (citing Wharton v. State, 42 N.E.3d 538, 541 (Ind. Ct.

App. 2015)).

[11] The trial court set aside the default judgment pursuant to Ind. Trial Rule

60(B)(1) & (8) on the basis “that the failure to respond was a result of actual

lack of service to defendant or was due to a mistake or excusable neglect.”

Appellant’s App. p. 42. Huncilman argues that there is no evidence to support

the trial court’s conclusion that there was an “actual lack of service.”

Huncilman also argues that there was no evidence to support the conclusion of

that there was excusable neglect. Appellant’s Br. at 14, Appellant’s App. p. 42.

Because of the facts of these particular circumstances, we address these

arguments together.

[12] Initial service of a summons and complaint is governed by Indiana Trial Rule

4.1. It reads, in relevant part:

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 7 of 11 In General. Service may be made upon an individual, or an individual acting in a representative capacity, by:

(1) sending a copy of the summons and complaint by registered or certified mail or other public means by which a written acknowledgement of receipt may be requested and obtained to his residence, place of business or employment with return receipt requested and returned showing receipt of the letter; or

(2) delivering a copy of the summons and complaint to him personally; or

(3) leaving a copy of the summons and complaint at his dwelling house or usual place of abode; or

(4) serving his agent as provided by rule, statute or valid agreement.

[13] A party properly brought into court is chargeable with notice of all subsequent

steps taken in the cause down to and including the judgment, although he does

not in fact appear or have actual notice thereof. Vanjani v. Federal Land Bank of

Louisville, 451 N.E.2d 667, 670 (Ind. Ct. App. 1983). Absent a showing of

excusable neglect, a party is bound by the proceedings occurring thereafter. Id.

The following facts have been held to constitute excusable neglect, mistake, and inadvertence: (a) absence of a party’s attorney through no fault of party; (b) an agreement made with opposite party, or his attorney; (c) conduct of other persons causing party to be misled or deceived; (d) unavoidable delay in traveling; (e) faulty process, whereby party fails to receive actual notice; (f) fraud, whereby party is prevented from appearing and making a defense; (g) ignorance of defendant; (h) insanity or

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 8 of 11 infancy; (i) married women deceived or misled by conduct of husbands; (j) sickness of party, or illness of member of family.

Id. (quoting Continental Assurance Company v. Sickels, 145 Ind. App. 671, 675, 252

N.E.2d 439, 441 (Ind. Ct. App. 1969)).

[14] Ind. Trial Rule 55(B) references service of a motion for default judgment and

states:

(B) Default Judgment. In all cases the party entitled to a judgment by default shall apply to the court therefor . . . [i]f the party against whom judgment by default is sought has appeared in the action, he, (or if appearing by a representative, his representative) shall be served with written notice of the application for judgment at least three [3] days prior to the hearing on such application. If, in order to enable the court to enter judgment or to carry it into effect, it is necessary to take an account or to determine the amount of damages or to establish the truth of any averment by evidence or to make an investigation of any other matter, the court may conduct such hearing or order such references as it deems necessary and proper and shall accord a right of trial by jury to the parties when and as required.

[15] Huncilman argues that, pursuant to Rule 55(B), whether Voyles actually

received the motion for default judgment is irrelevant as the trial rule only

requires that the request for default judgment be served on a party who has

appeared in the action. While the language used in the trial rule indeed only

explicitly requires service upon a party who has appeared, we are mindful that

our supreme court has reminded us that “the important and even essential

policies necessitating the use of default judgments – maintaining an orderly and

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 9 of 11 efficient judicial system, facilitating the speedy determination of justice, and

enforcing compliance with procedural rules – should not come at the expense of

professionalism, civility, and common courtesy.” Huntington Nat’l Bank v. Car-X

Assoc. Corp., 39 N.E.3d 652, 659 (Ind. 2015). Here, it does not appear that

default proceedings were used as a “gotcha” device. Id.

[16] The parties do not dispute that Voyles received the complaint and summons in

this matter. Once Voyles received the summons and complaint, he bore the

burden of appearing, keeping apprised of the proceedings, and defending

himself. Additionally, Huncilman attempted to serve Voyles with the Motion

for Default Judgment; the Motion for Default Judgment contains a certificate of

service that contains the same incorrect address that the complaint and

summons contained. Ex. Vol., Petitioner’s Ex. 2a.

[17] Voyles participated in settlement negotiations and was advised by Rush by

letter and in person that Huncilman intended to move for default judgment if

Voyles did not appear and file an answer when settlement negotiations fell

through. Moreover, once he was served with the complaint, he was chargeable

with notice of subsequent actions in the matter, whether or not he received

actual notice. Vanjani, 451 N.E.2d at 670. There are no other facts in the record

to show that Voyles was otherwise incapable of appearing and defending

himself. The law distinguishes neglect from excusable neglect, and we conclude

in these circumstances that the neglect on the part of Voyles was not excusable.

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 10 of 11 Conclusion

[18] Because Voyles’s neglect in failing to appear and file an answer after being

advised that he needed to do so in order to avoid default judgment does not

constitute excusable neglect, and because we find no other reason on these facts

to set aside default judgment, we reverse the trial court’s order setting aside of

the default judgment in this matter.

[19] Reversed.

Vaidik, C.J., and Crone, J., concur.

Court of Appeals of Indiana | Memorandum Decision 18A-CT-1958 | April 23, 2019 Page 11 of 11