Bell v. Inland Mutual Insurance

strictly applied. requirement The hearing. to a Roberts, See Dolin v. respond timely the motorist in a 443, fashion is W.Va. (1984). S.E.2d 802 unduly burdensome in view Finally, appellant contends that strong promoting public State’s interest in he was not guilty of the offense with which safety importance and the to the motorist charged. he highly was It would be inap driving privilege. of the See Van Meter v. propriate for this appeal Vehicles, Virginia Dept. West Motor any appellant’s consider bare asser 129, (1984). 173 W.Va. 313 S.E.2d 405 Ac relating tions to the facts surrounding his cordingly, we find appellant arrest. Those were matters to be con right waived his to an administrative hear sidered hearing. the administrative ing by timely his failure to file a request the appellant timely Since did not make a therefor. request hearing, authority we have no appellant The also contends that to consider them here. suspension of his license without an summary, appel- we conclude that the hearing administrative pro violates due lant was requirement well aware of the cess. It is not privilege contested that the request hearing that he days within ten operating a motor vehicle is a valuable so, thereby and failed to waiving do his private may interest which not be revoked statutory right to an administrative hear- application without the procedural ing challenge suspension of his driv- safeguards guaranteed by process the due If, asserts, er’s license. as he delay clauses of our federal and state constitu misunderstanding part was due to a tions, including notice and opportunity attorney, his the result is unfortunate. Burson, 535, to be heard. Bell v. 402 U.S. However, appellant as the has shown no (1971); 91 S.Ct. 29 L.Ed.2d 90 Jordan legal right legal clear to or Roberts, duty on the 161 W.Va. 246 S.E.2d 259 (1978). part of the equally provide It is clear Commissioner to a hear- that the statu tory procedures set therefor, forth in timely request W.Va.Code absent a we seq. 17C-5A-1 et for administrative sus § must affirm of the Circuit pension of an individual’s driver’s license Court of County denying Kanawha the writ satisfy requirements process. of due prayed of mandamus for. See, e.g., Mackey v. Montrym, 443 U.S. Affirmed. 99 S.Ct. 61 L.Ed.2d 321 Dixon Love, Roberts, L.Ed.2d 172 Jordan v.

supra. process “Due is not violated ...

when, here, constitutionally sufficient 332 S.E.2d 127 procedure administrative but available Luther F. BELL complainant merely declined or failed advantage to take of it. Dusanek v. Han non, (7th Cir.1982).” 677 F.2d INLAND MUTUAL INSURANCE (Del.Ch. v. Oberly, Cook 459 A.2d COMPANY, corporation. 1983). CAMDEN FIRE ASSOCIATION appellant next asserts that W.Va.Code seq. 17C-5A-1 et is unconsti § tutional because while the motorist is held Lonnie JUSTICE. compliance

to strict ten-day with the statu tory period, time Nos. 16257. the Commissioner is un der no similar time constraints. There is Supreme Court of Appeals no merit this contention. appellant Virginia. West does not contest that he is treated differ April 1985. ently any than similarly per other situated Rehearing Denied June Legislature son. The fact that the chose to impose different time limitations

Commissioner appellant than it did on the

does not confer him legal right a clear Brewster, Morhous &

Hudgins, Coulling, Bluefield, Cameron, Caruth, T. Donald Ins. Inland Mut. Co. Johnson, Watson, R.

Steptoe & James Johnson, Charleston, Steptoe & Christo- Bastien, Clarksburg, for Camden pher P. Fire Assn. Brumfield, David Brum-

Ballard & C. field, Welch, F. for Luther Bell and Lonnie Justice.

McHUGH, Justice: actions, No. No. 16252 and These appellants, In- involving the Inland Mutual (hereinafter Company “Inland Mu- surance (herein- tual”) and Camden Fire Association Fire”), respectively, contain after “Camden consolidated similar issues and have been purpose of resolution of those is- for the sues.

I INLAND A. MUTUAL involving Mutual is The action Inland from or- upon appeal before this 19, 1983, by the Circuit der entered June County in which that Court of McDowell court denied a motion of Inland to judgment against Mutual Kenny West set aside a default obtained manding compensatory punitive dam- Bell, against appellee, F. Luther ages. Mutual, by counsel, Inland answered $53,491.85 compensatory damages complaint liability beyond and denied $25,000 punitive damages plus inter- $10,000 policy limit and asserted defenses est and costs. the original personal injury against suit Kenny West. May, 1967, appellee was injured when he fell from the back a truck Approximately later, one month ap- by Kenny driven West and owned by his pellee served Inland interrog- Mutual father, appellee Ozie West. The com- atories that were not answered. In Febru- menced a civil Kenny ary, appellee moved the circuit West, however, Ozie Kenny West was re- compel court to Inland Mutual to answer siding Jersey. In February, New interrogatories. In an order entered of process service was made Kenny 4, 1983, February the circuit court ordered timely West no but answer was filed. The appellant to interrogatories answer circuit court entered default judgment “by February all defenses of against Kenny West. ad- the defendant will be ordered stricken and the of dressed issue the liability father’s judgment granted will be to plaintiff the on for the In accident. an order entered on pleadings.” his The interrogatories re- February 23, Ozie West was dis- mained unanswered in contravention of the prejudice. missed from the action with The court’s order and in April, appel- the court, however, judgment entered against lee moved the circuit court to strike the $35,000 Kenny West for compensatory in appellant’s pleadings under W.Va.R.Civ.P. damages plus costs and interest an- at an 37(b) and judgment enter default for the nual of six percent. rate appellee. hearing argument After of coun- West, In Bell v. 168 W.Va. 284 sel, court, the in an May order entered (1981), S.E.2d 885 this Court the affirmed appellant’s struck the pleadings, and judgment of the circuit dismissing granted appellee judgment by the a de- by Ozie West refusing from the action fault. liability extend to the father under the fam- a jury At trial on damages, the issue of ily purpose doctrine of because the attenu- appellee presented witnesses, the four one ated Kenny connection between and Ozie appellee. of whom was jury the The West. This Court further affirmed the appellee awarded the the amount of the against Kenny West. In so original judgment against Kenny West of doing, we noted the existence of W.Va. $35,000, prejudgment upon interest Code, 17D-4-12(b)(2) [1959], requires amount at an annual rate from the 10% all “liability poli- motor vehicle insurance original award, February 23, date the cies issued in provi- this State to contain a 1978, totalling $18,491.85, $25,000 in sion making anyone using an ve- insured punitive damages: $78,- total award hicle express implied permission with the plus 491.85 interest and costs. The circuit insured, of the named an in- additional appellant’s court denied the motion to set sured.” 168 W.Va. S.E.2d judgment. aside the 887 n. 1. The record that soon indicates thereafter B. CAMDEN FIRE appellee the Inland contacted Mutual’s involving The case Camden Fire before by requested counsel letter and Inland Mu- upon appeal us from an order of the Circuit pay tual judgment, including the interest County, Court McDowell costs, entered De- against Kenny Sep- West. In 21,1983, tember, 1982, cember in which court denied appellee the filed a complaint appellant’s in the County the motion under Circuit Court of McDowell against W.Va.Code, 60(b) judg- Inland to set Mutual under R.Civ.P. aside default 17D-4-12(b)(2) [1959], alleging against Justice, in- that the ment obtained Lonnie company wilfully $61,276.16 surance pay appellee, compensato- failed to the the for in dam- $300,000 juryA held determine punitive in dam- trial was damages and

ry $61,- ages. jury verdict for costs. The returned ages plus interest and $300,- compensatory damages and 276.16 in August, 1979, appellee obtained In the damages. punitive Fire real from Camden fire insurance indicates that of the circuit court order his name son. property titled pursuant appellee moved the court fire, destroyed by property was 15(b) to amend demand Va.R.W. Civ.P. however, Fire investigation, Camden to reflect the counterclaim for appellee benefits pay refused punitive damages demand for an increased Fire filed policy. Camden under $300,000. The motion in the amount declaratory judgment the Cir- granted and court awarded County to deter- Court of McDowell cuit appellee damages in the amount total of an insurable interest mine the existence $361,276.16 plus interest and costs. appellee. property in the complaint appellee answered II against counterclaim Camden asserted a A. RULE DISCOVERY property for the loss to the under Fire SANCTIONS policy. joined He also terms presented by two broker- A common issue third-party defendant insurance through insurance was cases now before us involves age firm which the counterclaim, rendering appel- judgments purchased. In the court’s $63,900 compensatory appellants as sanctions lee demanded $25,000 punitive damages with the orders com- damages and their failure 37(b), discovery. plus pelling W.Va.R.Civ.P. interest and costs. pertinent part: provides, later, year appel- the Approximately one (2) officer, director, party an or If a or upon Camden interrogatories lee served managing agent party person a or a of third-party Fire and the defendant. Cam- 30(b)(6) 31(a) designated Rule or to under interrogato- Fire to den failed answer the testify party obey a fails to on behalf of appellee The the circuit court ries. moved permit discovery, provide an to or order compel Fire to answer the inter- to Camden including an made under order subdivi- on Feb- rogatories and an order entered 35, (a) this sion of rule or Rule the 4, 1983, ruary to appellant was ordered pending may in which the action is make “by February interrogatories such answer regard the failure as such orders to 14, 1983, judgment will entered or be just, among following: others the interrogato- against plaintiff_” The in April, ries remained unanswered (C) striking

1983, pleadings An order out or appellee moved the circuit court thereof, staying proceed- appellant’s pleadings. parts In an or further to strike the 2, 1983, ings obeyed, or May on the court until order is dismiss- order entered ing proceeding any part or or appellee a default the action granted thereof, rendering the insur- or a and dismissed from the action ,1 party... the disobedient ance broker. (D) any foregoing spectrum of of the or to a In lieu orders 1. The other sanctions available thereto, 37(b)(2) treating a circuit court under Rule is as follows: an order addition obey any contempt to of court failure (A) regarding order An matters except physical to a an order submit to orders desig- any order made which the or other examination; or mental to nated facts shall be taken be established (E) comply party has to Where failed purposes of the action in accordance with 35(a) requiring with order under Rule him order; an obtaining party the claim examination, produce or- to another for such (B) refusing to allow the An order disobedi- (A), (B), paragraphs ders as are listed in party support oppose designated to or ent subdivision, (C)of failing party defenses, unless prohibiting or him from claims or introducing designated evidence; produce comply he is unable to shows that matters in person for examination. such 37 is virtually Arkansas, W.Va.R.Civ.P. identical to Packing Hammond Co. v. Federal 37 of the Rules of Civil Proce- 212 U.S. 322 S.Ct. 53 L.Ed. 530 [29 Chandos, Samson, dure. See Inc. v. (1909)]. These decisions establish that 428, 432, W.Va. 146 S.E.2d there are constitutional limitations W.R.C., see also N.C. power courts, even in aid of their (1984). S.E.2d 793 n. processes, own valid dismiss affording party opportuni- without It should first be established that ty hearing for a on the merits of his imposition sanctions cause. court under W.Va.R.Civ.P. failure of 357 U.S. obey the court’s order at S.Ct. at L.Ed. at provide permit discovery partly upon or is within Based constitutional considerations, sound Rogers discretion the court will the Court held “that appeal disturbed unless there Rule 37 should has not be construed to complaint been an of that authorize abuse discretion. dismissal of this National be- petitioner’s Hockey League Metropolitan noncompliance cause Hockey with a Club, 639, 642, 2778, pretrial production 427 U.S. 96 S.Ct. order when has been 49 L.Ed.2d established that failure gen comply See has been Miller, erally Wright willfulness, A. due to inability, C. & and not to Federal bad faith, any petitioner.” Practice fault of and Procedure: Civil 2d 357 U.S. § (Supp.1983). 78 S.Ct. at 2 L.Ed.2d at 1267. language Rogers consistently has striking pleadings and the render- interpreted require been some evidence judgment by of a default under Rule willfulness, contumacy faith bad 37(b)(2)(C) are considered the harshest part disobedient in order to sanctions for the failure to with an support imposition of these severe compelling Chandos, order discovery. Inc. Chandos, Samson, sanctions. Samson, See Inc. v. supra. In Societe Internatio- supra. generally 4A J. Moore & J. pour Participations nale Industrielles et Lucas, Commerciales, Moore’s Federal Practice S.A. 1137.- Rogers, (Cum.Supp.1984-85). 37-78 (1958), As 03[2.5] L.Ed.2d 1255 the United Supreme Appeals States for the Court of the United States Forty-Second reversed Second Circuit noted in complaint the dismissal of Cine for a party’s Corp. obey failure to Street Theatre v. Allied Artists Pic district court’s 1062, (2d order produce Corp., certain tures 602 F.2d banking doc- 1067 Cir. 1979), however, uments in appellate located “the party Switzerland. The cases com argued monly production proposition that cited only of the document hold could have led to that an violations of Swiss law dismissal is abuse of discretion possible criminal sanctions. The where failure to was not result eventually records any were party.” confiscated of the (emphasis add government. ed). Swiss The in Rogers Court The in Forty-Second Cine stated: Corp. Street Theatre affirmed the render against a default provisions diso Rule 37 which are party “gross professional

here bedient involved must where light be read in of the provisions negligence” part of the Fifth had been found on the Amendment that person deprived party’s no property shall be counsel. See also v. Corchado law, process Inc., without Puerto due Rico Marine Management, and more against (1st Cir.1981), denied, particularly opinions 665 F.2d 410 of this cert. Elliott, 826, in Hovey 60, v. 459 167 U.S. 409 U.S. 103 S.Ct. 74 L.Ed.2d 63 841, (1982); Brothers, S.Ct. 42 (1897)], L.Ed. 215 v. Merrill 547 [17 Affanato any failure, foregoing In lieu of orders or in that unless court finds thereto, require addition the court shall substantiallyjustified failure that other party failing advising expenses, including attorney’s obey attorney the order or the expenses circumstances make an award of pay him or both to the reasonable unjust. fees, caused 172 472, 102 F.R.D. Cir.1977). Piper Corp., (1st Edgar see v. ci v. 138 But F.2d Aircraft (8th Cir.1977). (S.D.Fla.1984). As the court stated 770 488

Slaughter, 548 F.2d Affanato: Street Theatre Forty-Second In Cine for the traditional The essential reason three-fold set forth the Corp., the court a par- courts to default reluctance of the contained Rule the sanctions purpose of favoring law ty ‘policy is the 37(b). court stated: merits.’ disposition of cases on their Preclusionary ensure that a orders Corp., 437 v. Motors Richman General profit its own be able from will not cases). Cir.1971) 196, (1st (citing F.2d 199 Powell, comply. Dellums v. failure to time, however, in consid At the same 339, U.S.App.D.C. 566 F.2d 231 184 appropriate an ering default is wehther spe- (1977). Rule 37 strictures are must also be borne sanction other factors and, contempt, like civil cific deterrents mind, energies such as ‘the time and compliance with the they seek to secure rights our of would-be courts and order at hand. Robison v. particular litigants awaiting to have oth their turns Co., 368 F.2d 37 Ins. Transamerica Poppenheim er matters resolved.’ Von Cir.1966). although (10th Finally, Boxing Wrestling v. Portland & Com may be im- most drastic sanctions Cir.1971), 1047, (9th mission, 442 F.2d penalties,’ posed as ‘mere Hammond denied, 404 U.S. rt. Arkansas, ce Packing U.S. Co. v. 715, 30 L.Ed.2d 731 S.Ct. 29 S.Ct. 53 L.Ed. see Elliott, (footnote omitted). Hovey v. U.S. S.Ct. The sanctions avail- Id. (1897), are free weighed 42 L.Ed. 215 courts “must to the circuit court be able general deterrent effect light to consider of the full record the case....” may Corp. have on instant case Forty-Second their orders Street Theatre Cine litigation, provided Corp., other Pictures 602 F.2d v. Allied Artists they is, 1068; imposed Hockey League on whom at see National sense, Hockey Club, fault. some National Metropolitan Hockey 427 U.S. club, League Metropolitan Hockey L.Ed.2d at 750. 96 S.Ct. at Inc., 427 S.Ct. U.S. foregoing, hold In view of the we (1976) curiam); (per L.Ed.2d 747 Societe pleadings the ren striking pour Participations In- Internationale dering Rogers, et dustrielles Commerciales party as sanctions under W.Va.R.Civ.P. 2 L.Ed.2d obey an party’s failure (1958).2 provide permit of a circuit court to order 602 F.2d at 1066. See also United States imposed discovery may by the court Co., Ltd., Marine & Fire Ins. Sumitomo through it has established where been (9th Cir.1980). F.2d 1365 hearing light full evidentiary and the court that the failure to rule, record before general rendering aAs the willfulness, comply has been due to bad by default as a sanction under party or and 37(b) sparingly faith the disobedient should be used Rule and, further, inability comply not the to only in extreme situations. Affanato Brothers, 140; just. such supra at Carluc- sanctions are otherwise Merrill discovery Hockey League, with future orders of the district 2. The stated in National supra: court. here, law, But in other areas of the the as tendency part of is a natural There spectrum pro- most severe in the sanctions courts, reviewing properly employing the ben- to vided statute or rule must be available heavily hindsight, be efit of to influenced cases, appropriate not the district court outright severity a sanction dismissal as penalize may merely to those whose conduct discovery comply with a order. failure sanction, be deemed to warrant such but quite is to conclude that It reasonable might tempted to deter those such who subjected such order will who has been chastened, absence of such a deterrent. though conduct duly so that even he feel 642-43, 2780-81, ap- at 96 S.Ct. at 49 having the order reversed on succeeds peal comply promptly at 751. will L.Ed.2d he nonetheless necessary iden they interrogatories It is also for us to had known about the tify evidentiary em or compelling discovery they framework to be the orders ployed during hearing interrogatories before a court would answered have properly considering imposition they because had they of sanc what assert are 37(b). Obviously, par tions under meritorious defenses to the actions not, therefore, ty 37(b) would risked seeking liability under Rule has have sanctions judgments by with establishing default. noncompliance burden of with provide the circuit court’s order to or argument, Confronted with a similar permit discovery. noncompliance Once Forty-Second court in Cine Theatre Street established, upon is the burden the diso Corp. stated: sought bedient to avoid sanctions may play Considerations of fair dictate 37(b) by showing under Rule that the ina that courts eschew harshest sanc- bility to comply with court’s order or provided tions Rule 37 where failure special render particular circumstances oversight is due ato mere unjust. sanctions See Fed.R.Civ.P. amounting counsel to no more than sim- notes; advisory committee see Fal ple negligence, supra, Affanato, Corp. v. Brewing Brewing Miller staff 141; F.2d at see Auto- SEC Research Co., (9th Cir.1983); 702 F.2d (2d Cir.1975) Corp., 521 F.2d mation Ltd., (9th Hooker, David v. F.2d (dictum). professional But gross where Cir.1977); Inc., Special In re Delivery, is, negligence has been found—that (N.D.Ohio 1982); syl. B.R. 714 pt. Ward clearly where counsel should have under- Hester, App.2d 32 Ohio 288 N.E.2d duty stood his to the court—the full (1972), aff'd, 36 Ohio St.2d range may of sanctions be marshalled. N.E.2d 861 As the court stated Indeed, day in this burgeoning, costly Corp. Brewing Brewing v. Miller Falstaff protracted litigation should courts Co., supra party against at 784: “The from imposing shrink harsh sanc- expenses whom an sought award of has where, case, they tions as in this showing the burden special circum clearly warranted. stances that make his or her failure peril, A at litigant chooses counsel his comply substantially justified.” Link v. Wabash Railroad U.S. (1962), 8 L.Ed.2d B. DEFENSES OF APPELLEES here, contexts, countless other

RELATING TO SANCTIONS disregard professional counsel’s of his responsibilities can lead to extinction of appellants dispute Both assertions claim. his client’s appellees appeal they acted willfully, in bad faith were otherwise 602 F.2d at 1068. In Corchado Puerto Inc., fault when inter- they Management, supra failed to answer the Rico Marine rogatories pursuant Appeals to the circuit court’s the United States Court of Circuit, orders. their appellants reaching claim that the First conclu- a similar sion, interrog- counsel failed inform them noted: “We realize that we are visit- atories had been served them that attorneys the sins client, compelling orders had entered their is an been but this side effect unavoidable appellants adversary system.”4 answers.3 The contend that if of the during respective 3. It should be their the noted found that lower court had not abused its action, litigations, represented by part, when appellants were discretion it dismissed both the plaintiffs appear the same both because the to counsel in the circuit court and counsel failed hearing. appellees represented by for a The Court that intentional were the found same counsel. dilatory tactics could be from the over- inferred 626, respect party. of to all behavior the With the In Link v. Wabash Railroad 4. 1386, plaintiffs (1962), action Court stated: counsel the Supreme 82 S.Ct. 8 L.Ed.2d 734 the Court of the certainly United States affirmed the dismis- There is no merit to the conten- by sal of an a petitioner’s action district court Fed. under tion that dismissal of claim be- motion, 41(b), upon R.Civ.P. the court's own his counsel’s conduct im- cause of unexcused prosecute. unjust plaintiff poses penalty failure of the to The Court on the client. Peti- an 174 Container, Atlas Co. v. the above reason Hamilton Watch agree with We 52, Inc., 156 W.Va. 190 S.E.2d party’s a counsel that where and hold gross negligence fails intentionally or with point 3 syllabus further held We pro a court to obey of circuit to an order Gibson, supra: Intercity Realty Co. v. of range of discovery, the full permit vide is judgment to a default “A motion vacate 37(b) are under W.Va.R.Civ.P. sanctions the to sound discretion of the addressed party repre court to the available ruling on such motion court and court’s the con by that counsel must bear sented appeal not unless there will be disturbed The rela sequences of counsel’s actions. showing of discre a of an abuse such is of the disobedient responsibilities tive Romano, 3, syl. v. pt. tion.” McDaniel with fore its in accordance counsel (1972); 875, 190 S.E.2d see 155 W.Va. by to is an issue be raised going standards Shelton, syl. v. 157 W.Va. pt. Toler also a circuit court appropriate party before (a (1974) va motion to S.E.2d 85 imposi a for the considering motion when 60(b) to judgment pursuant Rule cate 37(b). Rule We tion of sanctions under to discretion generally addressed the sound of the individu now turn to examination court). of al cases. clear in both cases that records are syllabus held in This Court Inland Mu- process was satisfied when due Gibson, Intercity Realty Co. v.

point of oppor- and Camden Fire were afforded tual (1970): 175 S.E.2d 452 W.Va. evidentiary hearings tunities for A judgment obtained accord- appellees’ for sanctions under Rule motions 55(b), provisions of Rule ance with the silent, however, 37(b). as The records are Procedure, Virginia Rules of Civil West request- appellants of to whether either valid and enforceable of hearings. ed such The records both will a motion set aside such heard cases reveal that circuit court granted the movant shows be unless argument of counsel. prescribed in good cause therefor of the aforesaid Rules of Civil involving In the Inland Mu Procedure. attempt appears to have been no tual there preserve re 55(c); syl. appellant a record pt. see See W.Va.R.Civ.P. garding the asserted error Coury Tsapis, 172 W.Va. 304 S.E.2d Mutual, by Jarrett, this Inland (1983); syl. 171 court on issue. pt. Cordell counsel, entry syl. objected to the of the default pt. S.E.2d attorney voluntarily court enter an order to show cause this as his district tioner representative chose action, hearing, necessary, and he cannot deemed and hold if consequences the acts or now avoid the of costs and determine whether assessment Any freely agent. omissions selected attorney attorney’s citation for fees or even an wholly other notion would be inconsistent just contempt and effective would be more litigation, system representative with our entry of a default sanction. Dismissal and acts which each is deemed bound judicial be rare act. should lawyer-agent have his and is considered to dilatory noncompliance is the When result facts, can be 'notice of all charged notice which counsel, the courts should investi- conduct attorney.' Ayer, Smith gate attorney’s responsibility as an officer [(11 Otto)] 633-34, L.Ed. 955]. U.S. 326 [25 and, appropriate, impose if of the court 8 L.Ed.2d 370 U.S. at dismissal or client sanctions less extreme than default, it is the client is unless shown that Edgar Slaughter, F.2d But see deliberately failing bad or in faith (8th Cir.1977), States Court the United wherein with the court’s order. Eighth Appeals Circuit balanced the for the Forty-Second Corp., See also Cine Street Theatre possess must con- wide latitude a trial J., (Oakes, (“It concurring) supra at 1069 would discovery concept pretrial ''that trol with greatest I reluctance ... that would with opportunity justice to be system our counsel, upon the client the sins of absent right visit litigant’s precious heard is a most condonation, compliance, knowledge, or sparingly The court contin- client’s causation"); denied.” should County, ued: Hawkins v. Fulton entering judg- 416, (N.D.Ga.1982). a default Prior to dismissal F.R.D. ment, require a should fundamental fairness 60(b) develop requested, alia, it at an to Rule judgment but failed inter evidentiary hearing evidentiary hearing pro- the circumstances of determine the judgment priety pre- judgment. that default otherwise of the default We believe proceedings that serve record of the before the circuit court abused its discretion court. before when The record us is clear it denied Fire an opportunity Camden We, appellants’ appeared in develop regard. counsel at all a record therefore, hearings the circuit court. before the Circuit reverse Court of County McDowell this issue on and remand Furthermore, Fire, unlike Inland Camden this case to for a hearing that court Mutual failed to seek relief from the de- develop surrounding the facts the render- judgment 60(b) through a Rule mo- against judgment default Cam- tion accordance with the well established opinion. den Fire with this consistent standards set forth As we noted in above. W.R.C., 434, N.C. v. W.Va. S.E.2d There are additional matters from the (1984): primary “The vehicle individual remain cases that to be resolved. party may relief judg- assignments which seek from a We will other first discuss ment or order in a court error involving is contained from the action Inland Mu- Virginia in Rule tual. West Rules of utilizing 60(b), By

Civil Procedure.” Inland Mutual developed could have Ill record on the for the reasons failure to Inland Mutual contends that the cir- interrogatories. answer the cuit jury court erred it allowed the when

It axiomatic that this Court “can con- prejudgment consider interest at an annual only sider those matters the record in judgment rate percent against of ten determining whether the court abused its it against which resulted the verdict from Huntington discretion.” Evans v. Pub- Kenny February West on 1978. The Inc., lishing 168 W.Va. 283 S.E.2d appellant question propriety does not C., see also Thornton v. C.A.M. prejudgment award of interest or the 172 W.Va. 320-21 S.E.2d period of time for which was calculated (1983); Hylton v. Provident & Acci- challenge but does annual rate of inter- Life dent Insurance 159 W.Va. 226 est jury was allowed to consider. The (1976). S.E.2d Based the record appellant percent the ten asserts that annu- us, the before circuit court did not abuse its al interest not rate should have been al- discretion when it rendered the default original lowed judgment because the judgment as a result Inland Mutual’s $35,000 against Kenny ofWest was accru- failure with court’s order court, ing, by postjudgment order of the compelling discovery; nor was there an percent. interest at an rate of six annual refusal discretion on the to set the abuse legislature In amended aside.5 W.Va.Code, [1981], which 56-6-31 codified involving availability prejudgment

In the Camden interest Fire, appellant “[ejxcept the circuit actions it is pro moved where otherwise law_”6 pursuant statutory provi- vided That to set aside the default W.Va.Code, [1981], partial emphasized that 6. is a It should be the record before 56-6-31 cod- holdings City ification of this Court’s Bond v. clearly us indicates that Inland Mutual has been Huntington, Bell, 166 W.Va. S.E.2d 539 litigation in this since Luther involved of (1981). Homes, Inc., Mobile See Kirk v. Pineville appellee, complaint Kenny filed the 212 n. 1 W.Va. 310 S.E.2d Despite West ren- Ozie in 1967. Bond, availability In we the traditional extended against one of Inland Mutual’s insureds dered prejudgment interest actions based on con- many years ago, appellee remains uncom- tract, Code, [1931], to actions 56-6-27 injuries. delay pensated That disturb- for his point syllabus based on tort. 5 of Bond we case, ing. Inland in this Mutual’s actions permitting held ages by way additional rule dam- "[a] short, certainly noteworthy nor exam- pecu- compensatory interest ples compa- to be followed insurance other niary personal prior losses incurred to trial in nies. wrongful injury actions well as death claims amendment to W.Va. provided post- The 1981 only for previously

sion had judgment interest. The 1981 amended ver- Code, 56-6-31 ^[1981] was passed by 6, 1981 provides, April in relevant on and became legislature sion of that statute 5, 1981, its days from July on part, as follows: effective We c. 205. passage. 1981 W.Va.Acts decree, any part or or judgment [I]f interest prejudgment that therefore hold thereof, special damages, as for is provided by law as accruing on amounts damages, below, liquidated fined or for 5,1981, at a July is to be calculated liquidated prior to special of such amount percent six under rate of the maximum annual damages interest from shall bear W.Va.Code, 47-6-5(a) [1974], and there bring shall right to the same date the after, of ten accrued, by the at a annual rate as determined maximum have damages provisions lost with the percent includes accordance Special court. income, W.Va.Code, [1981], expenses, wages and medical 56-6-31 personal property, damages tangible Accordingly, the Circuit out-of-pocket expenditures, and similar County is reversed of McDowell by the court. as determined Mutual, and to Inland interest issue as increased The amended statute further court for case is remanded postjudgment annual rate on prejudgment the maximum interest of the recalculation percent prejudgment interest from six princi- appellee with the due the consistent provides: rate of percent. It “The to ten ples set forth above. one hun-

interest shall be ten dollars ad- petition appeal for Inland Mutual’s annum, per proportionate- dred dollars aspects other of the action below dresses sum, for a ly greater or lesser concerning including the statute errors time, notwithstanding longer or shorter limitations, propriety punitive Prior any provisions other law.” instruc- damages, evidentiary issues and W.Va.Code, maximum [1981], the 56-6-31 during the on dam- jury tions to the trial percent per legal rate of interest six we regard to these contentions ages. With W.Va.Code, 47-6-5(a) annum. [1974]. part no error on the find respect to rate of interest With court. from applied sought the amount

to be IV the circuit court erred Inland Mutual Fire, involving in In the action Camden allowing application percent of ten remaining assignment of error concerns February terest on the sum back to damages punitive the amount of awarded the verdict was rendered date rule, appellee by jury. In his counter- general It to the against Kenny West. is a alia, claim, demanded, McCormick, appellee at inter supra as stated § $25,000 punitive damages. jury, changed statutory rate “[i]f however, accrues, punitive inter returned a verdict for after the of action cause $300,000. damages in the amount of Cam- at rate be est should be allowed the old altering fore, after, den Fire contends under W.Va. the new 54(c) circuit court erred when In R. Civ.P. enactment takes effect.” See Coastal granted appellee’s Port motion after Authority Trinity dustrial Water original Division, verdict to amend its demand Portland land Cement General (Tex.1978); reflect the the counterclaim to 563 S.W.2d Cement damages. (Tex.Civ. punitive 22, 24 increased award Haag Pugh, 545 S.W.2d 54(c) provides, pertinent part, App.1976). Dam generally See 25 C.J.S. judgment by “A shall not 92(1) (Cum.Supp.1984). follows: ages § Homes, Inc., syl. supra; prior Mobile and our Kirk v. Pineville is consistent with our case law contexts, pre- Ilosky Corp., pt. liberal interest statute." both Michelin Tire 172 W.Va. litigant as (1983). interest is available to generally C. S.E.2d 603 See part compensatory damages "where there McCormick, Damages Handbook on the Law of loss_" pecuniary an ascertainable 54 at § syl. pt. at 548. 276 S.E.2d

177 in pears relatively simple apply, in kind or to one diffi- different from exceed be prayed cult, resolved, that for in demand yet definitively amount as and judgment.” problem presented is when is in in a situation which the rendered disagreement among There is commenta plead appeared subsequently but failed to on the of tors and cases issue whether or the action.” Id. at otherwise defend damages of in a default award concluded, 142. The commentators how- may original judg exceed the demand for ever, “[tjhe any words that absence po ment. The distinction between the two qualification or in the differentiation first primarily type lies in sitions of default 54(c) that judgment that has been rendered. In sentence Rule indicates Sar F.Supp. 371, provision apply lie E.L. Bruce 265 377 is to all cases of intended to (S.D.N.Y.1967), the States default, they United District whether involve a who Southern Court for the District of New ‘in appeared’ ‘has or one default for failure ” “[¿judgments by York stated that (footnotes appear.’ to 142-3 Id. at omit (1) general of two kinds: for want of ted). States, Fong 300 v. United F.2d (2) appearance, plead and to for failure (9th Cir.), denied, 413 370 cert. U.S. provided by to otherwise defend as (1962); 82 S.Ct. 8 L.Ed.2d 807 rules, although ap the party initially has Exchange see and also Securities Com peared in the action.” Wencke, (9th 577 F.2d mission Cir.), denied, position The appli- first advocates strict cert. U.S. S.Ct. 54(c) cation of Rule judg- Henry to all default 58 L.Ed.2d 422 regardless Sneiders, Cir.), ments of the manner in (9th which 490 F.2d cert. they position arise. This is advanced in denied, U.S. 95 S.Ct. Kane, Wright, C. A. Miller & M. Federal (1974). L.Ed.2d Practice & Procedure: Civil 2d § 54(c) approach The second to Rule was (Supp.1983), it when states follows: pioneered by the United States Court of theory provision this is that once Appeals for the Eighth Circuit in Peitzman defending party original receives the Illmo, Cir.), (8th City 141 F.2d 956 pleading he should be able decide denied, cert. requested the basis of the relief whether L.Ed. 577 The court in Peitzman time, expend effort, he wants to stated: money necessary to defend the action. 54(c) apparently general is a Rule rule

It would fundamentally be unfair to have applicable non-appearing in case of a the complaint lead defendant to believe a only complete fendant default. hear- type a certain and dimension of On then, being sought question relief damages, should under scope he attempt defendant, to limit the and size though in de- potential him fault, hearing is in court on limited to defaulting, not appearing or otherwise damages, question of the amount of give allow the type court a different same that he in a extent * * * larger relief damage or a award. merits, amend- trial on we think then, sum, judgment may In a default appropriate at the are as ments trial not extend to matters outside the issues case as in the other. Amend- one pleadings raised or beyond the pleading may ments to be allowed at scope of the relief judg- demanded. A damages hearing on as to relief ment in a default case that awards relief subject right prayed, to the of the defen- that either is more than or different dant, by surprise if taken put requested originally kind from that disadvantage, to ask for a continuance or may null and void defendant attack prepare in which meet the for time collaterally proceeding. it in another claim, omitted). (citations enlarged omitted). (footnotes Id. 139-42 general, may change said that a prayed for is not vital recognize amount above commentators 54(c) ap- prayer is in “[ajlthough portion importance, of Rule as the for relief not be different judgment by default shall or cause of part of the claim fact no in amount kind or exceed from stated. judgment,” prayed for in the demand Air- Trans World at 962. See 141 F.2d judgment by the de- apply does not where F.2d 78-79 lines, Hughes, Inc. v. the rendered as result has been Cir.1971), grounds, (2d on other rev’d obey an order defaulting party’s failure Airlines, Trans World Hughes Tool Co. v. permit provide or of the circuit court to Inc., 34 L.Ed.2d discovery Civ.P. under W.Va.R. Co., supra E.L. Bruce Sarlie v. appears defaulting party otherwise at the 377-78; Properties, Growth at see also the dam- subsequent trial on issue Holding F.Supp. Klingbeil Inc. v. therefore, court, did (D.Md.1976). not generally ages. 220-21 Lucas, appellee’s motion granted the & J. Moore’s Federal err when it J. Moore (Cum.Supp. original judg- 1232-33 for 54.61 at increase his demand Practice § Moore, 1984-85); A New Federal Clark & ment. Parties, II, Pleadings and Procedure Civil foregoing, the orders of Based (1935).7 LJ. Yale County with of McDowell the Circuit Court Airlines, In Inc. Trans World now us are respect to cases before both supra, United States Court Hughes, part in part, in reversed re- affirmed Appeals for the Second Circuit proceed- further manded that court for the ones in presented with facts similar to opinion. with ings consistent involving Camden Fire. The the case part in part; Affirmed in reversed Airlines, in Inc. concluded: Trans World remanded. appear not Although the authorities do agreement ... are of the to be in we BROTHERTON, Justice, dissenting: there is no sound basis for view that restricting precise damages TWA to majority I agree with most of the While originally sought in a case where dam- I with their inter- opinion, disagree must ages unliquidated, and alleged were pretation 54(c) Syl. pt. in as of Rule default non- where defendant did not judgments in cases applies default appearance, but rather because of non- appeared and a has the default where discovery procedures, compliance with as sanction. The rule judgment is issued a trial granted and indeed was a full on judgment by default mandates that “[a] damages actually question of caused kind not be different in from ex- shall by its allegation established default. prayed ceed in amount that for at Id. (Emphasis added.) judgment.” for demand meaning phrase is clear and reasoning agree with the

We Inc., apparent: judgments Airlines, quite that default espoused in Trans World for prayed not exceed the amount the restriction con shall supra, and hold that 54(c) judgment. interpreting In the demand for tained in W.Va.R.Civ.P. “[a] may pleading requested. initially what the initial have advocates broader 7. Professor Moore far; 54(c) City go expressed in Rule does it makes view than that But not Peitzman Illmo, supra. type judgment by In his treatise he states follows: no distinction default; judgments by and hence default all that, policy, arguable It as a matter subject to its limitations. apply only Rule limitations should Where, however, appears defendant appearance judgment default for want of hearing judgment, application for and not to a default where the court, of a discre- in the exercise sound appeared. has latter fendant situation tion, may permit the claimant to amend his put appearance who has be, prayer for relief. This is as it should proceedings entitled to receive notice of all 54(c) action, read as earlier noted Rule is to be including a written notice of the rules, conjunction with days certain related application prior at least 3 liberally dealing Rule with hearing application.... one of these is such [This authorizing amendments. would warrant factor] Lucas, Federal Practice judgment as 6 J. Moore & J. Moore’s render such a the com- court to to, plainant proved no entitled matter 54.61 1231-33. ¶ himself a rule the Court should the same follow construing

rules as when it is a statute.

One of the most honored of these rules is the Court should read a different

meaning plain into a statute where See,

meaning is clear. e.g., Crockett v.

Andrews, 714, 718, S.E.2d (1970). Therefore, 386-87 whenever a is entered it should not allowed exceed amount in the judgment.

demand for Whether the de- was entered as a sanction

or whether or appeared not the

irrelevant. majority gives

Because the an excellent interpreta-

discussion both views of the 54(c),

tion of Rule I shall not rehash the Despite thorough

matter here. their analy-

sis, however, I the majority feel has I, wrong

reached the conclusion and there-

fore, my respectfully note dissent.

332 S.E.2d 141

Charles W. NORTH

WEST VIRGINIA BOARD

OF REGENTS.

No. 16201.

Supreme Appeals Virginia.

West

Submitted Jan. 1985. April

Decided

Rehearing 11, 1985. Denied June

Case Details

Case Name: Bell v. Inland Mutual Insurance

Court Name: West Virginia Supreme Court

Date Published: Apr 11, 1985

Citation: 332 S.E.2d 127

Docket Number: 16252, 16257

Court Abbreviation: W. Va.