No. 7727DC145 | N.C. Ct. App. | Jan 17, 1978
Although Judge Phillips classified the four statements to which plaintiff takes exception as findings of fact, they are in fact conclusions of law and for purposes of appellate review will be treated as such. “A conclusion or inference of law by the lower court is reviewable, even though the lower court denominates it a
Plaintiff contends first that the trial court erred in concluding as a matter of law that a default judgment cannot be entered against a nonresident defendant unless said nonresident defendant is actually served with summons with a copy of the complaint attached within the boundaries of North Carolina. We find merit in this contention.
G.S. 1A-1, Rule 4(j)(9)b clearly authorizes service of process by registered or certified mail on any party to an action commenced in a court of this State having jurisdiction of the subject matter and grounds for personal jurisdiction as provided in G.S. 1-75.4, where the party to be served cannot after due diligence be served within, and is not an inhabitant of, this state.
This being an action in contract for $5,000, the district court had jurisdiction of the subject matter. G.S. 7A-240, 243. The next question is, did said court have grounds for personal jurisdiction as provided in G.S. 1-75.4? We answer in the affirmative.
G.S. 1-75.4(5) provides that a court of this state having jurisdiction of the subject matter has jurisdiction over a person served pursuant to Rule 4(j) in any action which:
a. Arises out of a promise, made anywhere to the plaintiff or to some third party for the plaintiff’s benefit, by the defendant to perform services within this State or to pay for services to be performed in this State by the plaintiff; or
b. Arises out of services actually performed for the plaintiff by the defendant within this State, or services actually performed for the defendant by the plaintiff within this State if such performance within this State was authorized or ratified by the defendant; or
c. Arises out of a promise, made anywhere to the plaintiff or to some third party for the plaintiff’s benefit, by the defendant to deliver or receive within this State, or to ship from this State goods, documents of title, or other things of value; or ... .
Next, plaintiff contends that the trial court erred by concluding as a matter of law that a default judgment could not be entered against a nonresident defendant without providing the defendant an opportunity to appear by forwarding said defendant a copy of the trial calendar at least three days prior to the term of civil court in which defendant’s case has been calendared. We find merit in this contention.
A review of the Rules of Civil Procedure, the General Rules of Practice for the Superior and District Courts, and the North Carolina case law does not reveal any basis for Judge Phillips’ conclusion of law to which plaintiff’s Exception No. 2 relates. G.S. 1A-1, Rule 55(b)(2), requires that a defendant who has appeared in the action be served with written notice of the application for a default judgment at least three days prior to the hearing on the application. However, this provision is inapplicable in the present case since the defendant did not make an appearance in the action prior to the entry of default by the clerk on 10 August 1976 or the default judgment on 18 August 1976.
Plaintiff contends next that Judge Phillips erred by setting aside the entry of default against the nonresident defendant. We agree with this contention.
Under Rule 55(a), entry of default by the clerk is proper “[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or is otherwise subject to default judgment as provided by these rules or by statute and that fact is made to appear by affidavit or otherwise.” In the present case, plaintiff filed two affidavits on 10 August 1976 showing that service was had on defendant by certified mail on 28 June 1976 pursuant to Rule 4(j)(9)b, that defendant had failed to respond within the required time, and that defendant was neither an incompetent
Rule 55(d) governs the setting aside of an entry of default and provides:
(d) Setting aside default. — For good cause shown the court may set aside an entry of default, and, if a judgment by default has been entered, the judge may set it aside in accordance with Rule 60(b).
In the present case, the defendant properly made and filed a motion to set aside the default judgment in accordance with Rules 60(b), 7(b) and 5(a), (d), (e), but he failed to make or file a motion to set aside the entry of default as required by Rules 55(d), 5(a), (d), (e), and 7(b).
Rule 5 sets forth the requirements for service and filing of pleadings and motions. Rule 7(b)(1) provides that “[a]n application to the court for an order shall be by motion which, unless made during a hearing or trial or at a session at which a cause is on the calendar for that session, shall be made in writing, shall state the grounds therefor, and shall set forth the relief or order sought. . . .” (Emphasis ours.)
In his “motion” filed 30 September 1976, defendant sets forth four motions. In the first one he asks that the default judgment dated 18 August 1976 be set aside and states several reasons therefor. In his second and third motions he asks that the default judgment be set aside on the grounds (1) of surprise, inadvertence and excusable negligence, and (2) that there is a controversy as to whether defendant is indebted to plaintiff in any amount. In the fourth motion he asks for the release of his property upon the posting of bond. At no place in his “motion” does defendant ask that the entry of default be set aside.
We hold that Judge Phillips erred in finding and concluding that the entry of default was improper and should be set aside.
Plaintiff contends next that the trial court erred in setting aside the default judgment of 18 August 1976. We find no merit in this contention.
G.S. 1-75.11 provides:
Judgment against nonappearing defendant, proof of jurisdiction. — Where a defendant fails to appear in the action within apt time the court shall, before entering a judgment against such defendant, require proof of service of the summons in the manner required by § 1-75.10 and, in addition, shall require further proof as follows:
(1) Where Personal Jurisdiction Is Claimed Over the Defendant. — Where a personal claim is made against the defendant, the court shall require proof by affidavit or other evidence, to be made and filed, of the existence of any fact not shown by verified complaint which is needed to establish grounds for personal jurisdiction over the defendant. The court may require such additional proof as the interests of justice require. (Emphasis added.)
(2) Where Jurisdiction Is in Rem or Quasi In Rem — Where no personal claim is made against the defendant, the court shall require such proofs, by affidavit or otherwise, as are necessary to show that the court’s jurisdiction has been invoked over the status, property or thing which is the subject of the action. The court may require such additional proof as the interests of justice require.
In the case at hand, plaintiff fulfilled all the requirements for entry of default by the clerk, and for default judgment under Rule 55, but he failed to meet the proof of jurisdictional grounds requirement of G.S. 1-75.11. G.S. 1-75.11 basically requires two things before a default judgment can be entered against a non-appearing defendant who was served by certified mail. First, there must be proof of service of summons in the manner required by G.S. 1-75.10(4). Plaintiff’s affidavits of 10 August 1976 fulfilled this requirement. Second, “[w]here a personal claim is made against the defendant, the court shall require proof by affidavit or other evidence, to be made and filed, of the existence of
Finally, plaintiff contends that the trial court erred in signing the order setting aside the entry of default and the default judgment. For the reasons stated above, we conclude that the court did err in setting aside the entry of default, but it did not err in setting aside the default judgment.
The provisions of the order appealed from to which plaintiff’s Exceptions 1, 2 and 3 relate, and the provision setting aside the entry of default, are vacated; the remaining provisions of the order are affirmed and this cause is remanded to the district court for further proceedings.
Reversed in part, affirmed in part, and cause remanded.