Hansher v. Kaishian

255 N.W.2d 564, 79 Wis. 2d 374, 1977 Wisc. LEXIS 1502
CourtWisconsin Supreme Court
DecidedJuly 1, 1977
Docket75-363
StatusPublished
Cited by42 cases

This text of 255 N.W.2d 564 (Hansher v. Kaishian) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hansher v. Kaishian, 255 N.W.2d 564, 79 Wis. 2d 374, 1977 Wisc. LEXIS 1502 (Wis. 1977).

Opinion

ABRAHAMSON, J.

Defendant Mike Kaishian appeals from an order of the county court denying his motion to vacate a default judgment taken against him by plaintiff Lester Hansher. Both parties are engaged in the used car business in Milwaukee.

There are two issues on this appeal:

1. Did Kaishian’s unsigned letter to plaintiff’s counsel constitute an answer to a complaint?

2. Did the trial court abuse its discretion in denying Kaishian’s motion to vacate the default judgment?

FACTS

The action in which the default judgment was rendered was commenced on December 5, 1974 by personal service of a summons and verified complaint. The complaint alleged that on or about June 25,1974, Kaishian acquired, as a trade-in from a third party, a 1967 Cadillac which had been sold to the third party by plaintiff Hansher, doing business as Northern Motors. The sale had been made pursuant to an installment contract by which the buyer granted to Northern Motors a security interest to secure payment of the balance due on the price of the car. The unpaid balance under the contract was alleged to be $385.19. The complaint alleged in substance that the security interest created by the buyer was perfected by Northern Motors and that Kaishian had actual or con *378 structive notice thereof, but that Kaishian, on or about July 18, 1974, sold the automobile to another person “free and clear of all liens and security interest” without disclosing Northern Motors’ perfected security interest.

On the basis of these factual allegations, the complaint alleged a cause of action under sec. 218.01(9), Stats., which creates for the benefit of a motor vehicle dealer licensee an action for treble damages against another licensee.

Sec. 218.01 (9), Stats., provides:

“ (9) CIVIL DAMAGES. Any licensee suffering pecuniary loss because of a violation by any other licensee of sub. (8) (a) 4, 11, 15, 16, 17, 23 or 24 or because of any unfair practice found by the licensor under sub. (5) (a), may recover damages therefor in any court of competent jurisdiction in an amount equal to 3 times the pecuniary loss together with costs including a reasonable attorney’s fee.” 1

Kaishian sent by certified mail an unsigned letter, dated December 5, 1974 (the same date upon which the summons and complaint had been served) to Mr. E. N. Rotter, the person named in the summons as attorney for Northern Motors. The text of Kaishian’s letter, in its entirety, is set forth in the margin. 2

*379 Without further communication between the parties, Northern Motors, by Attorney Rotter, applied for a default judgment, the matter being heard before the county court on January 6, 1975. No transcript of the default *380 judgment proceedings is in the record. However, the record does contain an affidavit of the court reporter stating that she had recorded the presentation of Attorney Rotter at the default judgment hearing, that Kaishian’s letter of December 5,1974 had been introduced in evidence, and that the contents of the letter were summarized for the court. Findings of fact and conclusions of law corresponding to the allegations in the complaint were rendered on January 13, 1975, and on January 14, 1975, judgment was entered in favor of Northern Motors in the amount of $1,427.17, which was treble the pecuniary loss of $385.19 together with $250 attorney’s fees and $21.60 for disbursements.

Upon being apprised of the judgment, Kaishian retained counsel. On February 3, 1975 he obtained an order to show cause why the judgment should not be vacated so as to allow him to file an answer. A proposed answer was filed, 3 and affidavits by Kaishian were submitted to the court. The substance of the affidavits was that Kaishian was unfamiliar with court procedure, that he had no previous experience with summons and complaints, that he did not know the significance of a summons, and that he thought his letter would serve as an answer to the complaint.

A hearing was held, and Kaishian’s testimony revealed that he had been involved in business for twenty years, and in the used car business for fifteen years; that he owned a tire dealership; that he possessed a degree in sociology from the University of Wisconsin-Milwaukee; *381 that he owned several parcels of real estate, including rental properties, and that he was familiar with the methods of securing payment of the price of automobiles and with the laws relating thereto.

At the request of Northern Motors, the trial court took judicial notice of court records relating to a lawsuit in the spring or summer of 1971 in which Kaishian had also been the defendant. Those records are not in the record before this court, but from the comments of the trial court, it appears that in 1971 Kaishian had responded to a summons and complaint served upon him by sending a certified or registered letter to the attorney named in the summons. A default judgment was entered which Kaishian moved to vacate, submitting affidavits to the effect that he assumed his letter would stand as an answer and he thought it was a responsive pleading. Apparently the judgment was vacated in that instance, and the matter settled out of court.

Kaishian was cross-examined concerning the earlier suit and admitted remembering that he had been served with process, but claimed not to remember that a judgment had been entered against him or that he had signed an affidavit for the purpose of having it reopened. With respect to the letter written in that case, he testified, “I wrote it about three weeks after I got [the summons and complaint] and they said I wrote it too late.”

At the close of the hearing the trial court ruled from the bench that it would deny Kaishian’s motion to vacate the judgment. The court felt that a meritorious defense had been pleaded in the proposed answer, referring to the allegation that someone at Northern Motors had told Kaishian it had no lien on the car as possibly giving rise to “some sort of estoppel.” However, the court found that Kaishian’s failure to answer was not excusable in view of his experience in the 1971 case and his general sophistication, education and experience in business. The court *382 found the statements of lack of understanding and experience contained in Kaishian’s affidavits to be untrue, and the court concluded that Kaishian “could not . . . possibly think his letter would serve as a meritorious or proposed answer on his behalf.” On March 26, 1975 the court entered its order denying the motion to vacate “for the reason that the defendant has failed to establish that said judgment was rendered through his mistake, or inadvertence, or surprise, or excusable neglect.” Kaishian has appealed.

THE LETTER AS AN ANSWER

The default judgment herein was rendered pursuant to sec. 270.62, Stats. 1973, which provided in pertinent part:

“270.62 Default judgment. (1) NATURE OF DEFAULT.

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Bluebook (online)
255 N.W.2d 564, 79 Wis. 2d 374, 1977 Wisc. LEXIS 1502, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hansher-v-kaishian-wis-1977.