429 Pa. 119 | Pa. | 1968
Opinion by
On June 1, 1964, Crown Construction Company (Crown), instituted an assumpsit action against New
On June 18, 1964, Newfoundland petitioned .for removal of this action to the U, S. District Court for:the Eastern District of . Pennsylvania
On June 25, 1964—23 days after service of the complaint in the state action—Crown filed a praecipe- for a default judgment in the state court because of.'Newfoundland’s failure to file an answer .in the state court to Crown’s complaint
Meanwhile, in the federal court Crown filed a motion to remand the action to the state court. On December 14, 1964, the U. S. District Court remanded the action to the state court.
On February 8, 1965—7 1/2 months after the entry of the default judgment—Newfoundland petitioned the state court to open the judgment and, thereafter, moved to strike off the judgment. The Court of Common Pleas of Cambria County entered an order refusing
In refusing to strike off the judgment, the court below found that the action had never been effectively removed from the state court and, therefore, when the default judgment was entered, the state court still retained its jurisdiction. In dismissing the petition to open judgment, the court below found that such petition had not been filed promptly and its delay had not been reasonably explained or excused.
On the reargument of this appeal, Newfoundland raised several issues: (1) at the time of entry of the default judgment, did the state court, in view ■ of the removal proceedings, have jurisdiction to entertain a proceeding such as a praecipe for the entry of the default judgment; (2) was Newfoundland improperly denied an opportunity to present evidence that certain entries which appear in the state court docket were erroneous?
At the original argument of this appeal, another issue was presented. Newfoundland challenged the propriety of the entry of the default judgment on the ground that, if service of process had been made under the terms of the Unauthorized Insurers Process Act, supra, §2b, then this judgment was prematurely entered since, under that statute a judgment could not be taken until 30 days had elapsed after service of the complaint whereas the instant judgment was entered 23 days after service of the complaint. Responding to this contention, Crown took the position that service had not been effected under the authority of the statute but rather under express authority contained in Newfoundland’s insurance policy which designated the Insurance Commissioner as the agent of Newfoundland and, thus, permitted resort to the ordinary rules for the service of process. Such argument brought Crown’s position into direct conflict with Pa. R.C.P. 2180, which,
Whether when the default judgment was entered the state court still retained jurisdiction depends upon whether Newfoundland at that time had fully and-strictly complied with the federal' statute providing for the removal of actions from state to federal courts. A removal statute is subject to strict construction and its provisions must be strictly complied with before the jurisdiction of a state court can be ousted: Kovell v. Pennsylvania Railroad Co., (N.D. Ohio), 129 F. Supp. 906 (1954); Hamilton v. Hayes Freight Lines, (E.D. Ky.), 102 F. Supp. 594 (1952). When a removal has been effected in strict compliance with the statutory requirements, then the state court’s jurisdiction ceases and any further proceeding in the state
The procedure for the removal of actions has been promulgated by the Congress.
In the case at bar, Newfoundland did not follow the mandate of §1446 (e) and did not promptly file a copy of the removal petition -with the prothonotary of the state court. The record clearly shows that Newfoundland did not file a copy of the removal petition with the prothonotary of Cambria County until 18 days after filing the removal petition in the federal court. That such filing fell far short of compliance with the mandate of §1446 (e) was recognized by Judge Joseph S. Lord, III of the U.S. District Court who stated, in remanding this case to the state court, “. . . [Newfoundland] has not even come close to sustaining its burden of showing that the case was effectively removed. . . .” The federal court having taken the view that this action had never been effectively removed from the state court and no appeal having been taken from its order, we are bound by this ruling. See: Supreme Lodge, Knights of Pythias v. Meyer, 265 U.S. 30 (1924). At the time of entry of the default judg
Newfoundland next urges that the entry of the default judgment by Crown violated §2(d) of the Unauthorized Insurers Process Act (Act of May 20, 1949, P. L. 1491, §2(d), 40 P.S. §1005.2(d)). That statute, providing a method of substituted service of process upon insurers who are not authorized to do business within the Commonwealth, permits service of process upon an unauthorized insurer by leaving with the Insurance Commissioner or his deputy two copies of the process and the payment of a fee; that the Insurance Commissioner forthwith shall mail, by registered mail, a copy of the process to the unauthorized insurer; that, within 10 days thereafter, notice of such service upon the Insurance Commissioner and a copy of the process shall be sent by registered mail by the plaintiff or counsel to the unauthorized insurer; that the plaintiff or counsel shall file an affidavit of compliance with the statutory provision plus the unauthorized insurer’s return receipt, on or before the date the unauthorized insurer is required to appear in court, with the prothonotary of the court in which the action is pending (§2(b)). Section 2(d) provides: “No plaintiff . . . shall be entitled to a judgment by default . . . until the expiration of thirty days from date of the filing of the affidavit of compliance [with §2 (b) ]
It is Newfoundland’s position that the instant complaint was filed on June 1, 1964, and sent by registered mail to the Insurance Commissioner on June 2, 1964; that Crown filed neither a return receipt nor an affidavit of compliance with the prothonotary; • that the
Newfoundland overlooks both its policy of insurance and §2(e) of the statute. . The latter provides: “Nothing in.this section contained shall limit or abridge the right to serve any process, . . . upon any insurer in any other manner now or hereafter permitted by law”. In the “Service of Suit Clause”—attached to the policy of insurance issued by Newfoundland to Crown and attached to the complaint filed in this action—in addition to.agreeing that, in the event of failure to make payment of any amount claimed under the policy, Newfoundland, at the request of its insured, will submit to the jurisdiction of any court of competent jurisdiction in- the United States and comply with all requirements necessary to give such court jurisdiction and, in addition to further agreeing that service of process might be made upon a certain firm at a certain address in New York, it was further stated: “Further, pursuant to any statute of any state ... of the United States which makes provision therefor, Underwriters/ the Company/ies hereon hereby designate/s the Superintendent, Commissioner or Director of Insurance or o tiier officer specified for that purpose in the statute,'. . ., as their true and lawful attorney upon whom may be served any lawful process in any action, siiit or proceeding instituted by or on behalf of the insured .. . arising out of this contract of insurance . . ., and hereby designate/s the above-named as the person to whom the said officer is authorized to mail such process or a true copy thereof.”
Crown contends that it did not undertake to make the substituted service provided under the Act of 1949,
Our examination of the provisions of the clause, supra, convinces us that Newfoundland therein expressly authorized service of process to be made upon the Insurance Commissioner as its attorney and agent and an examination of this record indicates that the service attempted was not the substituted service contemplated by §2(b) of the statute but service under the terms of the insurance contract sanctioned hy §2(e) of the statute. That being so, compliance with §2(b) and (d) was not required of Crown .and the default judgment was not prematurely entered.
Lastly, Newfoundland argues that the court below abused its discretion in refusing to open the default judgment without giving it the opportunity to present evidence that certain docket entries in the state court were erroneous. Specifically, Newfoundland wants to show that its local counsel was advised that a judgment had not been entered but only a praecipe for the entry of a default judgment and that, even though there was a docket entry “Judgment is entered in favor of the plaintiff and against defendant for failure to file an Answer”, such entry was not signed by the Prothonotary whereas the entry of the praecipe is signed by the Prothonotary. The purpose of such evidence would be to show that Newfoundland’s counsel was not aware, until January 25, 1965, that a judgment had been entered. - ■ ■
We have examined the docket entries in the court below. In the continuance docket the following entry appears: “25 June, 1964, Praecipe for Judgment filed by Gleason & Krumenacher, Attorneys for Plaintiff,
Amount: $16,492.97 Interest—see paper.
Praecipe for
25 June 1964, /Judgment entered and indexed.
Joseph C. Dolan
Prothonotary.”
In the judgment index appears the following entry:
Defendant Plaintiff
Newfoundland Crown
American In- Construction surance Com- Company pany, Limited
Amount No. Term Year Mon Day
1649297 12 Sep 1964 June 25
1964”
On the state of these docket entries it appears obvious that a judgment had been entered. It is difficult to understand how Newfoundland was not aware of the entry of judgment until January 25, 1965 when it learned of the issuance of a writ of execution. There is no allegation the records had been altered or subjected to tampering and we must presume the Prothonotary in the docketing and preservation of these records performed his duties as a public official. Any layman, let alone' a lawyer, who examined these docket entries after June 25, 1964 would have been put on warning, at the very least, a judgment had been entered.
What Newfoundland seeks, in this phase of its argument, is a remand of this matter to the court below to permit it to present evidence that its local counsel
Newfoundland, by a petition to strike off and a petition to open, have challenged this default judgment. Neither has merit. As to the former petition, the instant record reveals no such infirmity as would justify expunging this judgment from the record. As to the latter petition, we have a classic example of “too little too late”. The petition to open this judgment, filed seven months after the entry of the judgment, offers no reason for the delay in seeking to open this judgment and makes no attempt to indicate that it has a meritorious defense to the claim; under such circumstances the court below properly refused to open the judgment.
Order affirmed.
See: Insurance Commissioner’s certificate as shown by. docket entries.
The Act of Congress of June 25, 1948, c. 646, 62 Stat. 937, 28 U.S.C. §1441 (a), provides “. . . any civil action brought in a State court of which the district courts of the. United States have; original jurisdiction, may.be removed by the. defendant, or. the defendants, to the district-court, of the Umted States for the district .-and division. embracing the place where such-action is -pending.” ■ (Emphasis supplied). It is to be noted that Cambria..County;.-wherein the-instant action was pending, is in -the Western, not the Eastern, District of Pennsylvania,. • This requirement relates -to venue and not jurisdiction: Polizzi v. Cowles Magazines, Inc., 345 U.S. 663, 665, 73 S. Ct. 900, 902 (1953).
At that time the record was still in the state court.
The grounds of this petition were: (a) Newfoundland had not paid to the Prothonotary the requisite fee for filing the copy
Section 3 of the Act of May 20, 1949, P. L. 1491, 40 P.S. §1005.3 requires that an “unauthorized insurer”, before filing any pleading in any action instituted against it, shall either (1) deposit with the prothonotary cash, securities or a bond to secure the payment of any judgment which may be rendered against it in such action or (2) procure a certificate of authority to transact business in Pennsylvania. Newfoundland did neither.
The record upon which the federal court acted consisted of the removal petition, the motion to remand and Newfoundland’s answer to that motion.
The Act of Congress of May 24, 1949, c. 139, §83, 63 Stat. 101, as amended, 28 U.S.C. §1446(e).
The Acts of Congress of June 25, 1948, c. 646, 62 Stat. 937, 938, 939, amended May 24, 1949, c. 139, §§82, 83, 63 Stat. 101; July 25, 1958, Pub. L. 85-554, §5, 72 Stat. 415; September 29, 1965, ■Pub. L. 89-215, 79 Stat. 887, 28 U.S.C. §§1441-1446, ine.
See: Madisonville Traction Co. v. St. Bernard Mining Co., 196 U.S. 239, 25 S. Ct. 251 (1905).
See: Polizzi v. Cowles Magazines, Inc., 345 U.S. 663, 73 S. Ct. 900 (1953); Moss v. Atlantic Coast Line R. Co., 157 F. 2d 1005 (1946), cert. den. 330 U.S. 839, 67 S. Ct. 980 (1947).
This entire entry is typewritten with the exception of the signature “Joseph C. Dolan” which is handwritten.
This entire entry is typewritten with the exception of “Writ of Exec” and date thereof which is handwritten.