Progressive Direct Ins. Co. v. Williams

2022 Ohio 887, 186 N.E.3d 337

• Court: Ohio Court of Appeals
• Decided: March 21, 2022
• Docket: 9-21-26
• Status: Published

Opinion

[Cite as Progressive Direct Ins. Co. v. Williams, 2022-Ohio-887.]

IN THE COURT OF APPEALS OF OHIO THIRD APPELLATE DISTRICT MARION COUNTY

PROGRESSIVE DIRECT INSURANCE CO., ET AL.,

PLAINTIFFS-APPELLEES, CASE NO. 9-21-26

v.

PAUL WILLIAMS, OPINION

DEFENDANT-APPELLANT.

Appeal from Marion County Common Pleas Court Trial Court No. 20 CV 264

Judgment Reversed and Cause Remanded

Date of Decision: March 21, 2022

APPEARANCES:

Jacqueline Gutter for Appellant

Nadia N. Traxler for Appellee Case No. 9-21-26

ZIMMERMAN, P.J.

{¶1} Defendant-appellant, Paul M. Williams (“Williams”), appeals the July

14, 2021 judgment of the Marion County Court of Common Pleas denying

Williams’s motion to vacate the default judgment in favor of plaintiffs-appellees,

Progressive Direct Insurance Company (“Progressive”) and William L. Lindsay

(“Lindsay”) (collectively, “plaintiffs”). For the reasons that follow, we reverse.

{¶2} This case arises from a multi-vehicle accident, which occurred on April

18, 2018 in Marion County, Ohio. As relevant to this case, there is no dispute that

the vehicle operated by Williams collided with the vehicle, which was owned by

Lindsay, and was being operated Olivia Lindsay, who is not party to this case. On

July 22, 2020, the plaintiffs filed a complaint alleging a claim for negligence against

Williams and requesting $109,585.74 in damages. (Doc. No. 1). Because Williams

did not file an answer to the complaint, the plaintiffs filed a motion for default

judgment on December 11, 2020. (Doc. No. 3). The trial court granted the

plaintiff’s motion for default judgment on December 14, 2020. (Doc. No. 4).

{¶3} On July 12, 2021, Williams field a motion requesting that the trial court

vacate the default judgment for the reason that the trial court was without personal

jurisdiction to enter judgment against him. (Doc. Nos. 14, 15). Importantly,

Williams requested a hearing on his motion to vacate the default judgment. (Doc.

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No. 15). On July 14, 2021, the trial court denied Williams’s motion to vacate the

default judgment without a hearing. (Doc. No. 16).

{¶4} Williams filed his notice of appeal on August 13, 2021. (Doc. No. 17).

He raises three assignments on appeal, which we will discuss together.

Assignment of Error No. I

The trial court erred as a matter law [sic] by exercising personal jurisdiction over Mr. Williams when Progressive failed to comply with the Civil Rules.

Assignment of Error No. II

The trial court should have granted the motion to vacate when Mr. William’s [sic] filed an unopposed motion and affidavit stating he was not served and the docket showed the Clerk issued a notice of failure of service.

Assignment of Error No. III

The trial court erred in denying Mr. Williams’ Motion to Vacate without a hearing.

{¶5} In his assignments of error, Williams argues that the trial court abused

its discretion by denying his motion to vacate the trial court’s default judgment

without a hearing. In particular, Williams contends that “a certified mail receipt

marked ‘C-19’ and lacking [a] defendant’s signature or initials [does not]

constitute[] valid service of process.” (Appellant’s Brief at 1).

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Standard of Review

{¶6} Generally, “[a] trial court’s decision regarding a motion to vacate a

judgment will not be overturned on appeal absent an abuse of discretion.” TCC

Mgt., Inc. v. Clapp, 10th Dist. Franklin No. 05AP-42, 2005-Ohio-4357, ¶ 9, citing

C & W Inv. Co. v. Midwest Vending, Inc., 10th Dist. Franklin No. 03AP-40, 2003-

Ohio-4688, ¶ 7. An abuse of discretion constitutes more than an error of judgment;

rather, it implies that the trial court acted unreasonably, arbitrarily, or

unconscionably. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219 (1983).

Analysis

{¶7} “‘“It is rudimentary that in order to render a valid personal judgment, a

court must have personal jurisdiction over the defendant.”’” Britton v. Britton, 4th

Dist. Washington No. 18CA10, 2019-Ohio-2179, ¶ 12, quoting State ex rel. Doe v.

Capper, 132 Ohio St.3d 365, 2012-Ohio-2686, ¶ 13, quoting Maryhew v. Yova, 11

Ohio St.3d 154, 156 (1984). “‘“It is axiomatic that for a court to acquire jurisdiction

there must be a proper service of summons or an entry of appearance, and a

judgment rendered without proper service or entry of appearance is a nullity and

void.”’” Id., quoting State ex rel. Ballard v. O’Donnell, 50 Ohio St.3d 182, 183

(1990), quoting Lincoln Tavern, Inc. v. Snader, 165 Ohio St. 61, 64 (1956).

{¶8} “‘An appellate court reviews a trial court’s determination of whether

personal jurisdiction over a party exists under a de novo standard of review.’” Id.

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at ¶ 13, quoting State ex rel. Athens Cty. Dept. of Job & Family Servs. v. Martin,

4th Dist. Athens No. 07CA11, 2008-Ohio-1849, ¶ 13. “However, ‘[a] reviewing

court will not disturb a trial court’s finding regarding whether service was proper

unless the trial court abused its discretion.’” Id., quoting Beaver v. Beaver, 4th Dist.

Pickaway No. 18CA5, 2018-Ohio-4460, ¶ 8. Again, for this court to conclude that

the trial court abused its discretion, we must find that it acted unreasonably,

arbitrarily, or unconscionably. Blakemore, 5 Ohio St.3d at 219.

{¶9} Here, we conclude that the trial court abused its discretion by denying

Williams’s motion to vacate the default judgment without a hearing. That is, based

on the specific facts and circumstances of this case, we conclude that the trial court’s

conclusion (without a hearing) that service was proper in this case was

unreasonable, arbitrary, and unconscionable.

{¶10} “‘The plaintiff bears the burden of obtaining proper service on a

defendant.’” Britton at ¶ 14, quoting Beaver at ¶ 9. A rebuttable presumption “‘of

proper service arises when the record reflects that a party has followed the Civil

Rules pertaining to service of process.’” Bader v. Ferri, 3d Dist. Allen No. 1-13-

01, 2013-Ohio-3074, ¶ 20, quoting Poorman v. Ohio Adult Parole Auth., 4th Dist.

Pickaway No. 01CA16, 2002 WL 398721, *2, citing Potter v. Troy, 78 Ohio App.3d

372, 377 (2d Dist.1992).

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{¶11} “To rebut the presumption of proper service, ‘“the other party must

produce evidentiary-quality information demonstrating that he or she did not receive

service.”’” Britton at ¶ 15, quoting Hendrickson at ¶ 32, quoting McWilliams v.

Schumacher, 8th Dist. Cuyahoga Nos. 98188, 98288, 98390 and 98423, 2013-Ohio-

29, ¶ 51. “In determining whether a defendant has sufficiently rebutted the

presumption of valid service, the trial court may assess the credibility and

competency of the submitted evidence of non-service.” TCC Mgt., Inc., 2005-Ohio-

4357, at ¶ 15. Generally, “‘[a] trial court is not required to give preclusive effect to

a movant’s sworn statement that [the movant] did not receive service of process

when the record contains no other indication that service was ineffectual.’” Britton

at ¶ 15, quoting TCC Mgt., Inc. at ¶ 15. However, there can be circumstances under

which “such a sworn statement at least warrants the trial court conducting a hearing

to determine the validity of the movant’s statement.” TCC Mgt., Inc. at ¶ 15, citing

Wilson’s Auto Serv., Inc. v. O’Brien, 10th Dist. Franklin No. 92AP-1406, 1993 WL

54667, *1 (Mar. 4, 1993). See also id. (suggesting that “a trial court errs in

summarily overruling a defendant’s motion to set aside a judgment for lack of

service, when the defendant submits a sworn statement that she did not receive

service of process, without affording the defendant a hearing”), citing Wilson’s Auto

Serv., Inc. at *1 and Baumann v. Purchase Plus Buyer’s Group, Inc., 10th Dist.

Franklin No. 01AP-297, 2001 WL 1511991, *3 (Nov. 29, 2001). But see New Co-

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Operative Co. v. Liquor Control Comm., 10th Dist. Franklin No. 01AP-1124, 2002-

Ohio-2244, ¶ 9 (noting that “[a]n affidavit, by itself, stating that appellant did not

receive service, may not be sufficient to rebut the presumption without any other

evidence of a failure of service”).

{¶12} “Civ.R. 4.1 outlines the methods for obtaining service of process

within this state, including service via certified mail.” TCC Mgt., Inc. at ¶ 11. Under

“Civ.R. 4.1(A), service of process via certified mail is evidenced by a return receipt

signed by any person.” Id. See also Civ.R. 4.6. “Civ.R. 4.1(A) does not require

that delivery is restricted to the defendant or to a person authorized to receive service

of process on the defendant’s behalf.” TCC Mgt., Inc. at ¶ 11. See also CUC

Properties VI, LLC v. Smartlink Ventures, Inc., 1st Dist. Hamilton No. C-210003,

2021-Ohio-3428, ¶ 9 (“The “any person” language in Civ.R. 4.1 is not limited to the

defendant or its agents, but is a flexible concept construed broadly.”). “When

service is attempted by certified mail, a signed receipt returned to the sender

establishes a prima facie case of delivery to the addressee.” TCC Mgt., Inc. at ¶ 11,

citing New Co-Operative Co. at ¶ 8. “Valid service of process is presumed when

any person at the defendant’s address received the certified mail envelope, whether

or not the recipient is the defendant’s agent.” Id., citing New Co-Operative Co. at ¶

8.

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{¶13} In response to the Covid-19 pandemic, the United States Postal

Service (“USPS”) “modified mail procedures for services that normally required

carriers to venture in close proximity to customers.” CUC Properties at ¶ 3, citing

United States Postal Service, Covid-19 Continuity of Operations Update,

https://about.usps.com/newsroom/service-alerts/pdf/usps-continuity-of-operations-

03-20-2020.pdf (accessed Sept. 16, 2021). “In lieu of face-to-face signatures, USPS

instructed its carriers to maintain a safe distance, ask the recipient for their first

initial and last name, enter that information on the return receipt, and then have the

customer step back while the employee placed the mail in an appropriate place.” Id.

See also Finnell v. Eppens, S.D.Ohio No. 1:20-CV-337, 2021 WL 2280656, *2

(June 4, 2021) (noting that the USPS “adopted a signature policy for certified mail

in response to the COVID-19 pandemic,” which “instructed its delivery personnel

to ensure that someone was at the address to receive the letter, to ask that person for

their name, and to then leave the letter where the person could get it”).

{¶14} Shortly thereafter, the Supreme Court of Ohio instituted an

administrative action, which authorized Ohio’s courts of common pleas the power

to waive any rule requiring in-person service of process. See CUC Properties at ¶

13. Importantly, that administrative action authorized that “[a]ny requirement in a

rule of the Court that a party appear in person or requiring in-person service may be

waived by the Court, local court, hearing panel, board, or commission, as

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applicable.” See In re Tolling of Time Requirements Imposed by Rules Promulgated

by the Supreme Court & Use of Technology, 158 Ohio St.3d 1447, 1448, 2020-

Ohio-1166.

{¶15} Here, the record reflects that the plaintiffs attempted service via

certified mail on July 24, 2020, and that return of service was received in the trial

court on July 31, 2020 (as evidenced by a certified-mail receipt signed “C19”).

(Doc. Nos 1, 2). Notwithstanding the certified-mail receipt, the trial court’s clerk

of courts notified the plaintiffs on August 3, 2020 that service was “unsuccessful”

because the certified-mail receipt was signed “C19.” (Doc. No. 2). Thereafter, the

trial court issued an order on August 28, 2020 in accordance with the USPS

certified-mail policy and the Supreme Court’s administrative action authorizing it

to waive in-person service of process. (Doc. No. 16). See, e.g., CUC Properties at

¶ 13 (recognizing Ohio courts of common pleas that adopted “a variety of rules to

accommodate alternative certified mail signatures”); Finnell at *5 (acknowledging

a similar order issued by the federal court). Specifically, the trial court concluded

that “by marking COVID 19 comports with Rule 4.1(A)(1)(a) and due process” and

ordered that the “practice by the [USPS] will be treated as good service by” the trial

court. (Doc. No. 16). However, the trial court did not state whether its order should

be applied retroactively. Accord Finnell at *5 (noting that “while that order was

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‘effective immediately,’ the Court did not even purport to order retroactive

application”).

{¶16} In this case, Williams asserted in his motion to vacate that he was

never served with the complaint. In support of that assertion, Williams included an

affidavit in which he averred that that he did not receive the complaint and that no

one in his “household received or signed for the complaint * * * .” (Doc. No. 15).

Before providing the plaintiffs an opportunity to respond, the trial court denied

Williams’s motion to vacate without a hearing.

{¶17} On appeal, Williams argues that the trial court abused its discretion by

denying his motion to vacate without a hearing and by concluding that service was

proper in this case because, in part, the clerk of courts determined that service of

process was unsuccessful. A legal determination as to the validity of a signature on

a certified-mail receipt by a clerk of courts does not determine whether a court has

personal jurisdiction over a party. Furthermore, the case to which Williams directs

this court to suggest that it does is misplaced. See Maryhew v. Yova, 11 Ohio St.3d

154, 156 (1984) (noting in the statement of facts that the clerk of courts notified a

party that service “was returned by the postal authorities marked ‘unknown’”).

{¶18} Instead, based on the specific facts and circumstances of this case, the

“flexible” concept of the “any person” language of Civ.R. 4.1 coupled with

Williams’s sworn statement at least warrants a hearing for the trial court to

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determine whether it had personal jurisdiction over Williams. See TCC Mgt., Inc.,

2005-Ohio-4357, at ¶ 15. In other words, Williams’s sworn statement along with

the certified-mail receipt marked “C19” is sufficient evidence to merit a hearing

during which the trial court can more fully explore whether the plaintiffs met their

burden of showing whether proper service occurred in this case and, if so, whether

Williams can rebut the presumption that he was properly served. Furthermore,

while this court is cognizant of the unusual circumstances presented by the

pandemic and empathizes with the courts attempting to manage these extraordinary

conditions, we also recognize the importance of developing a full and complete

record to best serve the interests of justice.

{¶19} Consequently, we conclude that the trial court’s conclusion that

service was proper in this case was unreasonable, arbitrary, and unconscionable.

Thus, the trial court abused its discretion by denying Williams’s motion to vacate

the default judgment without a hearing.

{¶20} Having found error prejudicial to the appellant herein in the particulars

assigned and argued, we reverse the judgment of the trial court and remand for

further proceedings.

SHAW and WILLAMOWSKI, J.J., concur.

/jlr

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