Mann v. Hennessey

409 P.2d 597, 2 Ariz. App. 438

• Court: Court of Appeals of Arizona
• Decided: January 14, 1966
• Docket: 1 CA-CIV 78
• Status: Published

Opinions

JOHN A. McGUIRE, Superior Court Judge.

This is an appeal from an order vacating a default judgment entered in favor of the plaintiffs in connection with a motor vehicle accident.

Suit was filed January 18, 1962, process was served upon defendant appellee and by him promptly turned over to his insurance carrier. Negotiations were had between plaintiffs’ attorney and the insurance adjuster for defendant. The fact situation is discussed below; however the papers were never turned over to an attorney until after default judgment had been entered on February 28, 1963.

No oral testimony was introduced before the trial court and this court is in as good a position as the trial court to exercise its independent judgment as to both facts and law upon the written papers filed. DeSantis v. Dixon, 72 Ariz. 345, 236 P.2d 38, 44 A.L.R.2d 513 (1951); Combustion Engineering, Inc. v. Arizona State Tax Commission, 91 Ariz. 253, 371 P.2d 879 (1962); Cantlay & Tanxola, Inc. v. Senner, 92 Ariz. 63, 373 P.2d 370 (1962).

It is fundamental that motions to set aside defaults are to a great extent within the sound discretion of the trial court. Wellton-Mohawk Irrigation and Drainage District v. McDonald, 1 Ariz.App. 508, 405 P.2d 299 (1965) and cases cited therein.

The Supreme Court on December 31, 1965 in the case of Marquez v. Rapid Harvest, Ariz., 409 P.2d 285, in upholding the action of the trial court in setting aside a default said:

“This follows the general rule that any doubt which may exist should be resolved in favor of the application, to the end of securing a trial upon the merits. 6 Moore’s Federal Practice, #55.10 [1]; Hendrie Buick Co. v. Mack, 88 Ariz. 248, 355 P.2d 892 (1960).”

In this case on January 26, 1962, shortly after the service of summons, plaintiffs’ attorney wrote the insurance adjuster this letter:

“Gentlemen:

Please be advised that in accordance with our telephone conversation, you need not turn this file over to an attorney until you have received notice from us that settlement is not possible.

We will not default this matter pending settlement negotiations, and until you have been given 10 days previous written notice that the matter will be litigated.”

On July 16, 1962 the adjuster offered $660 and on September 21st (having received no reply) he wrote plaintiffs’ attorney:

“We would like very much to get this matter settled if it can be done at a realistic figure.

As you know this matter has been dragging on for some time under an open extension to file an answer to the complaint. If we are not going to be able to get together please advise me so that we may file our answer so that we may come to some final determination on the claim.

Hoping that I will be hearing from you in the immediate future.”

On October 1, 1962 plaintiffs’ attorney wrote the insurance adjuster:

“We have your letter of July 16, 1962, relative to your offer of settlement in the above matter.

Be advised that we do not feel the same to be fair in any regard and unless you can come up with some figure different than the one you have submitted, it is suggested that you file an Answer immediately.”

The receipt of this letter is disputed, however, in view of the very positive affidavits as to mailing and the fact that the affidavit of denial of receipt was made over seven months from the date of the letter, it is logical to conclude that the letter reached the adjuster’s office but somehow did not get in the file. See Merchants and Manufacturers Ass’n. v. First National Bank, 40 Ariz. 531, 14 P.2d 717 (1932) for the presumption concerning receipt of mail. There is a dispute as to whether there were further oral negotiations in November. It must be noted that Rule 80(d), 16 A.R.S., is very specific in requiring all agreements in respect to litigated matters to be in writing except when noted in the Clerk’s minutes.

Plaintiff finally took default on February 1, 1963, a hearing was held on February 18th and formal written judgment entered on February 28th. The motion to set aside the judgment was filed May 13, 1963.

It is evident that this is not a case of , “excusable neglect” as that term is ordinarily used. If the letter of October 1st was sufficient to give the ten days notice promised under the letter of January 26th, the neglect was inexcusable and the trial court must be reversed

If on the other hand the letter of October 1st was insufficient to give the ten days notice and start the time running then the letter of January 26th giving an indefinite extension was still in full force and effect and there was no neglect whatsoever. There is no criticism of plaintiffs’ attorney for taking the default. He considered that adequate notice had been given. It is however for this court to interpret the letter and determine its actual legal effect.

It is to be noted that negotiations developed very slowly; neither party appeared to be pushing the matter to final conclusion. The letter of October 1st spoke of the possibility of coming up with a different figure and contained the “suggestion” that otherwise “you file an Answer immediately”. This can well be construed as an invitation to further discussion and certainly was not a definite notice that negotiations had ended and that ten days notice was being given that the matter would be litigated.

The right of plaintiffs to take default depends solely on the wording of the letter quoted above. We hold that the wording of this letter is not so plain and unequivocal as to make it an abuse of discretion on the part of the trial court to hold it insufficient. The good cause requirement for setting aside a default was satisfied by the showing that the judgment was improperly entered.

Since there was no neglect to be relieved from, there is no need for a showing of a meritorious defense as is required when setting aside a default for excusable neglect. Gila Valley, etc., Co. v. Arizona Trust & Savings Bank, 25 Ariz. 177, 215 P. 159 (1923).

The order is affirmed.

DONOFRIO, J., concurs.