Taylor v. Triangle Porsche-Audi, Inc.

220 S.E.2d 806, 27 N.C. App. 711, 1975 N.C. App. LEXIS 1952
CourtCourt of Appeals of North Carolina
DecidedDecember 17, 1975
Docket7515SC555
StatusPublished
Cited by43 cases

This text of 220 S.E.2d 806 (Taylor v. Triangle Porsche-Audi, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Taylor v. Triangle Porsche-Audi, Inc., 220 S.E.2d 806, 27 N.C. App. 711, 1975 N.C. App. LEXIS 1952 (N.C. Ct. App. 1975).

Opinion

CLARK, Judge.

The order appealed from concluded that (1) the letter from Stewart Wallace, registered service agent, to the Clerk on 12 February 1975, constituted a general appearance under G.S. 1A-1, Rule 55, and defendant was entitled to notice of hearing of at least three days; (2) that the default judgment was void in that it was not entered with the consent of defendant and was not entered in open court under G.S. 1A-1, Rule 58; and (3) that there was nothing to support the award of treble damages pursuant to G.S. 75-16.

Plaintiff in his assignments of error takes the position that, first, Judge Alvis erred in considering defendant’s motion to •set aside the default judgment because the motion did not set out the rule number under which it was proceeding and in •allowing defendant to amend to set out the rule number; and, second, that the default judgment was not void and Judge Alvis had no authority to set it aside.

*714 In its motion to set aside the default judgment, defendant stated as ground therefor, as required by G.S. 1A-1, Rule 7 (b) (1), mistake, inadvertence, and excusable negligence, but defendant did not state the rule number under which it proceeded as required by Rule 6, General Rules of Practice for the Superior and District Courts. It is noted that Rule 1 of the General Rules, supra, provides: “These rules . . . shall at all times be construed and enforced in such manner as to avoid technical delay and to permit just and prompt consideration and determination of all the business before them.” The Rules of Civil Procedure achieve their purpose of assuring a speedy trial by providing for and encouraging liberal amendments to the pleadings under Rule 15. Roberts v. Memorial Park, 281 N.C. 48, 187 S.E. 2d 721 (1972). The philosophy of Rule 15 should apply not only to pleadings but also to motions where there is no material prejudice to the opposing party. In interpreting Federal Rule 60 in a case involving a motion to vacate a judgment, the United States Supreme Court stated that a trial judge abuses his discretion when he refuses to allow an amendment unless justifying reasoning is shown. Foman v. Davis, 371 U.S. 178, 9 L.Ed. 2d 222, 83 S.Ct. 227 (1962). The trial judge not only has broad discretion in allowing amendments, but also has wide latitude in the manner of allowing the same. Shuford, N. C. Practice and Procedure, § 15-5, p. 136 (1975). In this case, the trial judge averted a decision on the basis of a mere technicality in allowing the defendant to amend his motion to set out the rule number under which it was proceeding and his action in so doing was in keeping with the spirit of the rules and was not an abuse of his discretion.

We turn now to consideration of the defects in the default judgment which Judge Alvis found in his order vacating the default judgment.

Entry of default was made by the Clerk on 14 March 1975. Entry of default under G.S. 1A-1, Rule 55 (a) is the first step of a two-step process for obtaining judgment by default. The Clerk is required to make the entry if default is made to appear by affidavit or by any other appropriate proof, which may consist only of the record.

Default judgment by the Clerk is provided for by Rule 55(b)(1), is subject to the jurisdictional proofs required by G.S. 1-75.11, and is still controlled by G.S. 1-209 (4) which em *715 powers the Clerk to enter “all judgments by default and default and inquiry as are authorized by Rule 55 ” Rule 55 does not provide for judgments by “default and inquiry” per se and in any event the rule authorizes the Clerk to enter only those judgments which would have been designated formerly as “default final.” The entry of default and entry of default judgment by the Clerk may be simultaneous and can be contained in the same document. In this case, plaintiff did not seek a “default final” before the Clerk but instead sought in effect a “default final” from the Judge on the theory that his claim was for a sum certain.

Default judgment by the Judge is governed by both Rule 55(b) (2) and the jurisdictional proofs required by G.S. 1-75.11. If the party against whom default judgment is sought has appeared in the action, the party entitled to default judgment must apply to the Judge, and there must be service with written notice of the application for judgment at least three days befqre hearing. Did the defendant appear, within the meaning of Rule 55(b) (2), in this action? A party may appear without pleading. Crawford v. Bank of Wilmington, 61 N.C. 136 (1867). Negotiations between parties after institution of an action may constitute an appearance. Highfill v. Williamson, 19 N.C. App. 523, 199 S.E. 2d 469 (1973). The federal courts have interpreted the same provision in the Federal Rules broadly. See 6 Moore’s Federal Practice, Para. 55.05(3) (1972) and cases cited, including Dalminter, Inc. v. Jessie Edwards, Inc., 27 F.R.D. 491, 4 F.R. Serv. 2d 55 b. 21 (S.D. Tex. 1961) which held that a letter from defendant’s officer to plaintiff indicating that his corporation was not in existence constituted an appearance. We hold that the letter from defendant’s registered agent constituted an appearance under Rule 55 (b) (2) and that as therein provided plaintiff was required to give at least three days’ notice of the hearing on the application for default judgment. The failure to provide the notice of hearing requires that the default judgment be vacated. Miller v. Belk, 18 N.C. App. 70, 196 S.E. 2d 44 (1973).

Courts applying Federal Rule 55(b) (2), or state rules or statutes based thereon, are not in agreement as to the effect of a failure to give the required three-day notice of application for judgment by default. In some cases, such judgments have been held void as working a deprivation of due process; in other cases, such judgments have been viewed as irregular and voidable. Annot., 51 A.L.R. 2d 837 (1957).

*716 If the default judgment was not entered in open court pursuant to Rule 58 after hearing on 20 March, but was entered when filed on 28 March after being signed by Judge Smith out-of-session and out-of-county, then he as a special judge was without authority to sign the judgment without the consent of the parties, and the judgment is void. G.S. 7A-45(c). Shepard v. Leonard, 223 N.C. 110, 25 S.E. 2d 445 (1943) ; Edmundson v. Edmundson, 222 N.C. 181, 22 S.E. 2d 576 (1942) ; 2 McIntosh, N. C. Practice and Procedure, § 1624, p. 64 (Supp. 1970). The only pertinent facts in the record on appeal relative to entry of the default judgment appear in the order appealed from wherein Judge Alvis found that “upon the conclusion of the hearing the presiding judge in open court . . . advised counsel for plaintiff to make notes and incorporate the notes into a Judgment to be prepared by counsel and to be sent to the judge out of session . . . which counsel did on March 21, 1975 . ...” If we assume that the judge rendered judgment in open court, there was no entry of judgment because Rule 58 requires the judge to direct the clerk as to what notation shall be made, and the making of that notation constitutes the entry of judgment.

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Bluebook (online)
220 S.E.2d 806, 27 N.C. App. 711, 1975 N.C. App. LEXIS 1952, Counsel Stack Legal Research, https://law.counselstack.com/opinion/taylor-v-triangle-porsche-audi-inc-ncctapp-1975.