White Oak Manor, Inc. v. Lexington Insurance
753 S.E.2d 537
S.C.2014Background
- White Oak Manor contracted for service of process on Lexington via its policy service clause directing delivery to Lexington's counsel/legal department in Boston.
- White Oak mailed summons and complaint to Lexington; return receipt shows May 20, 2005 signed by Thomas W. Dinam; Lexington did not respond within 30 days, leading to default judgment July 15, 2005.
- Lexington argued service could only be valid under §15-9-270 (through the Director) and that contractual provisions were invalid.
- Circuit court held the policy's alternative service method valid and that service substantially complied; court of appeals held §15-9-270 exclusive.
- Court held §15-9-270 is not exclusive; policy terms binding; waivers allowed; reversed the court of appeals and affirmed circuit court.
- Lexington later challenged the default judgment, arguing lack of substantial compliance and lack of good cause to set aside.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is §15-9-270 exclusive for service on insurers? | White Oak: not exclusive; contract methods valid. | Lexington: exclusive Director service required by statute. | Not exclusive; contract service valid. |
| Should the default judgment be set aside? | Lexington: substantial noncompliance and lack of notice; merits relief. | White Oak: substantial compliance; good cause shown for relief should be denied notification prejudice. | No abuse of discretion; denial of relief affirmed. |
Key Cases Cited
- Equilease Corp. v. Weathers, 275 S.C. 478 (S.C. 1980) (statutes provide simple method to obtain jurisdiction over foreign insurers)
- Murray v. Sovereign Camp, W.O.W., 192 S.C. 101 (Supreme Court of S.C. 1939) (exclusive substituted service prior statute)
- Roche v. Young Bros., Inc. of Florence, 318 S.C. 207 (Supreme Court of S.C. 1995) (substantial compliance suffices for notice and jurisdiction)
- Fin. Fed. Credit Inc. v. Brown, 384 S.C. 555 (S.C. 2009) (waiver of service supported when defendant consents)
- State v. Sanders, 118 S.C. 498 (S.C. 1920) (purpose of summons is notice and jurisdiction; waivers allowed)
- Bakala v. Bakala, 352 S.C. 612 (S.C. 2003) (voluntary appearance equates to service; jurisdiction can be waived)