Wells v. Valley National Bank of Arizona

509 P.2d 615, 109 Ariz. 345, 1973 Ariz. LEXIS 345
CourtArizona Supreme Court
DecidedMay 2, 1973
Docket10762
StatusPublished
Cited by18 cases

This text of 509 P.2d 615 (Wells v. Valley National Bank of Arizona) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wells v. Valley National Bank of Arizona, 509 P.2d 615, 109 Ariz. 345, 1973 Ariz. LEXIS 345 (Ark. 1973).

Opinion

LOCKWOOD, Justice:

The appellant Frances E. Wells, while married to Welborn L. Wells, in 1960 pur *346 chased a model home. This home was the subject of the default judgment which appellant seeks to have set aside. Appellant and her former husband signed a mortgage note in the amount of $15,000 on this property in August 1960. Subsequently the Wells purchased another parcel of real property not subject to the action.

Pursuant to the Wells agreement with the contractor that built the model home, the contractor sold the property in question to C. Donald Gilbert and E. Bernice Gilbert, defendants along with the Wells in the initial action. The Wells were allegedly advised that the note and mortgage would be assumed by the Gilberts. However, according to the agreement, if the Gilberts failed to make the payments, then the Wells would be able to make the payments themselves and assume possession of the property. Later Welborn Wells signed a disclaimer deed to Frances Wells on said property.

Apparently the payments on the note referred to herein became delinquent in February 1968, and neither Frances Wells nor Welborn Wells were ever notified of the delinquency in the payments on the note to appellee Valley National Bank by the Gilberts.

On June 18, 1968, appellee filed its complaint. A private process server Lester Swanlund filed an. “Affidavit of Service of Process by Private Person” with the trial court on June 27, 1968, alleging that he served E. Bernice Gilbert in person on June 23, 1968. On June 28, 1968, James M. Koontz, the attorney and agent, for Valley National Bank filed a sworn “Affidavit of Unknown Residence” with the trial court which stated:

“That the place and residence of the Defendants C. DONALD GILBERT, a divorced man and WELBORN L. WELLS and FRANCES E. WELLS, his wife is unknown to the Plaintiff [Valley National Bank] and to this affiant.
“That this affidavit is made for the purpose of authorizing service of Summons in this action to be made on said Defendants by publication, in accordance with Rule 4(e)(3), Arizona Rules of Civil Procedure, A.R.S.”

Subsequently thereto, publication was duly made in the Arizona Weekly Gazette on the 2nd, 9th, 16th and 23rd days of July 1968. As a result, a default was entered against the Wells and the Gilberts. On September 18, 1968 judgment was entered for the bank against the Wells in the sum of $13,283.73; $545.27 representing accrued interest to date; $181.12 expended by the bank for taxes, insurance and assessments on the real property; $95.50 representing foreclosure title search and for $1,500 attorneys fees and for the bank’s costs which were $43.11.

A sheriff’s sale followed after notice by publication was made. The property was sold to the Valley National Bank for $15,696.63.

Frances Wells, in her affidavit attached to the motion to set aside the default judgment, attested to the fact that the trial court lacked jurisdiction since she was not personally served and the judgment was rendered in personam. On May 11, 1971, the trial court denied the Wells’ motion to set aside the default judgment but altered the judgment pursuant to Rule 60, Rules of Civil Procedure, regarding the personal liability of Frances Wells. The court said:

“THEREFORE, IT IS ORDERED that the judgment dated September 18, 1968 be corrected, altered and modified so as to provide that the judgment upon the debt is in rem only, and not in personam as against the Defendant FRANCES E. WELLS.” (Emphasis-added.)

The question presented is whether the trial court had jurisdiction to enter a default judgment against Frances Wells.

Regarding default judgments, the general rule is that if a court had no jurisdiction because of lack of proper service on the defendant, any judgment would be void. Marquez v. Rapid Harvest Co., 99 *347 Ariz. 363, 365, 409 P.2d 285, 287 (1965); Preston v. Denkins, 94 Ariz. 214, 219-220, 382 P.2d 686, 689 (1963).

Moreover, although it was more than two years since the final judgment, it has always been held that the mere lapse of time is no bar to an attack on a void judgment. Occidental Life Ins. Co. of Cal. v. Marsh, 5 Ariz.App. 74, 75, 423 P.2d 150, 151 (1967). As a result, the limit imposed by Rule 60(c), 16 A.R.S. Rules of Civil Procedure, does not control the proceedings, since “[I]f the judgment is void for lack of jurisdiction the court has no such discretion but must vacate the judgment.” Preston v. Denkins, supra, 94 Ariz. at 219, 382 P.2d at 689.

In order to obtain a judgment in personam, personal service of the defendant is required. Cf. O’Leary v. Superior Court of Gila County, 104 Ariz. 308, 452 P.2d 101 (1969). In the instant case personal service was not employed but rather service by publication, based upon Koontz’s affidavit. In that affidavit Koontz indicated that the residence of Frances Wells was unknown. On this point we have said:

“It is not the allegation that the residence is unknown which confers jurisdiction upon service by publication but the existence of the jurisdictional fact that the residence is unknown.” (Emphasis in original.) Preston v. Denkins, supra, 94 Ariz. at 222, 382 P.2d at 691.

We feel that in the instant case service by publication based on the Koontz “Affidavit of Unknown Residence” was incorrect. We believe that Koontz’s affidavit did not comply with the standard of due diligence as set forth in Preston v. Denkins, supra. In that case we noted:

“Regardless of whether the affidavit must recite a showing of due diligence, such diligence as a fact is prerequisite to the jurisdiction of the court.” 94 Ariz. at 222, 382 P.2d at 691.

In the affidavit made by Frances Wells to substantiate the motion to set aside the default judgment, she attests to the following facts, which are uncontroverted by Valley National Bank:

“1. The Defendants WELBORN L. WELLS and FRANCES E. WELLS resided at 3601 East Fairmont, Phoenix, Arizona, from November 1953 to December 1961.
‡ ífc %
“3. The Defendants Wells resided at 3136 North 37th Street, Phoenix, Arizona, from December' 1961 to the present time. (The Defendants Wells were divorced in 1970).
“4. The Plaintiff, Valley National Bank, Mortgage Loan Department did hold mortgages on all three of these properties to-wit: F.H.A. Title 1, 1947; F.H.A. Mortgage on 3601 East Fairmont, 1953; Conventional Construction Loan on 3136 North 37th Street in 1962; and the subject F.H.A. mortgage.
“5.

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Cite This Page — Counsel Stack

Bluebook (online)
509 P.2d 615, 109 Ariz. 345, 1973 Ariz. LEXIS 345, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wells-v-valley-national-bank-of-arizona-ariz-1973.