Lexington Insurance Company v. Charles Buckley
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IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI
NO. 2003-CA-01249-COA
LEXINGTON INSURANCE COMPANY
APPELLANT
v.
CHARLES BUCKLEY
APPELLEE
DATE OF JUDGMENT:
TRIAL JUDGE:
COURT FROM WHICH APPEALED:
ATTORNEYS FOR APPELLANT:
ATTORNEYS FOR APPELLEE:
NATURE OF THE CASE:
TRIAL COURT DISPOSITION:
DISPOSITION:
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
4/10/2003
HON. J. LARRY BUFFINGTON
COVINGTON COUNTY CHANCERY COURT
LAWRENCE CARY GUNN
LOUIS B. LANOUX
SAMUEL STEVEN MCHARD
DAVID SHOEMAKE
CIVIL - TORTS-OTHER THAN PERSONAL
INJURY & PROPERTY DAMAGE
DEFAULT JUDGMENT FOR THE PLAINTIFF
REVERSED - 09/06/2005
CONSOLIDATED WITH
NO. 2003-CA-02183-COA
LEXINGTON INSURANCE COMPANY
APPELLANT
v.
CHARLES BUCKLEY
DATE OF JUDGMENT:
TRIAL JUDGE:
COURT FROM WHICH APPEALED:
ATTORNEYS FOR APPELLANT:
ATTORNEYS FOR APPELLEE:
APPELLEE
09/15/2003
HON. J. LARRY BUFFINGTON
COVINGTON COUNTY CHANCERY COURT
LAWRENCE CARY GUNN
LOUIS B. LANOUX
DAVID SHOEMAKE
SAMUEL STEVEN McHARD
NATURE OF THE CASE:
TRIAL COURT DISPOSITION:
DISPOSITION:
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
TORTS-OTHER THAN PERSONAL INJURY &
PROPERTY DAMAGE
DENIED DEFENDANT’S MOTION TO SET
ASIDE THE JUDGMENT
REVERSED - 08/30/2005
BEFORE BRIDGES, P.J., GRIFFIS AND BARNES, JJ.
BRIDGES, P.J., FOR THE COURT:
I.
BACKGROUND
¶1.
Charles Buckley witnessed a tragic accident and filed emotional distress and negligence claims
against Allied Products. Because Allied had purchased a liability insurance policy from Lexington Insurance
Company, Buckley and Lexington attempted to negotiate a settlement. Lexington offered to pay Buckley
$140,000 to settle the claim, and Buckley accepted the offer with the added provision that Lexington pay
the settlement funds within ten days of their agreement. When Lexington did not tender settlement funds,
Buckley filed a complaint for specific performance in the Covington County Chancery Court. Lexington
did not respond to the suit and Buckley obtained a judgment against Lexington.
¶2.
When Lexington discovered the judgment, Lexington filed a motion to extend time for an appeal.
The chancellor granted Lexington’s motion and Lexington’s appeal of the judgment comprises one of the
present consolidated appeals.
¶3.
After Lexington filed its successful motion for extension of time, Lexington filed a motion to set
aside the judgment. Buckley also filed a motion to reconsider granting Lexington’s motion for extension
of time. The chancellor addressed both motions in one hearing and denied both. Lexington also appeals
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the chancellor’s denial of its motion to set aside the judgment. That appeal is the second of the present
consolidated appeals.
¶4.
Aggrieved by the two decisions mentioned above, Lexington argues: (1) that the chancery court
lacked personal jurisdiction over Lexington due to insufficient service of process, (2) that the chancery
court erred when it set the matter for trial, (3) that the chancery court erred when it awarded a judgment,
(4) that the chancery court erred when it denied Lexington’s motion to set aside the judgment, and (5) that
the chancery court erred when it awarded a judgment based on improper amended complaints. Aggrieved
by the chancellor’s decision to deny his motion to reconsider granting Lexington’s motion for extension of
time, Buckley cross-appeals and asks this Court to review that decision.
¶5.
Finding that the chancery court lacked personal jurisdiction over Lexington because of improper
service of process, and that the chancery court erred by conducting a trial on the merits where Lexington
failed to answer Buckley’s complaint or otherwise appear, we reverse the chancellor’s decision to award
a judgment in Buckley’s favor. Because the chancery court lacked jurisdiction, Lexington’s other issues
become moot. Likewise, Buckley’s cross-appeal becomes moot.
II.
FACTS AND PROCEDURAL HISTORY
¶6.
This complicated case involves a terrible accident, a lawsuit by a witness to that accident, a failed
settlement, litigation over that failed settlement, and an end result of two awards to the original plaintiff. The
plaintiff’s first award came by way of a settlement related to the original claim. The plaintiff’s second award
stems from a judgment connected to the litigation over the failed settlement.
¶7.
Charles Buckley is the plaintiff in both of the underlying actions and the appellee and cross-
appellant in the matter at hand. During August of 1998, Charles Buckley “bush hogged” the medians near
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the intersection of I-55 and Lakeland Drive in Jackson, Mississippi. As Buckley mowed, the mower blade,
manufactured by Allied Products, broke and shot out from under the mower.
¶8.
Tragically, Camilla Dawn Haynes, traveling with her children and her mother, died when the mower
blade went through the windshield of her van and virtually decapitated her. Camilla’s mother and children
survived. Buckley only realized the cause and severity of the situation when he approached Camilla’s van
and saw the results of the broken mower blade for the first time.
A.
Claim One
¶9.
In November of 2000, Buckley filed a complaint in the Covington County Circuit Court. By way
of his complaint, Buckley asserted claims against Allied Products. Buckley claimed that he suffered
emotional trauma from having witnessed the event mentioned above. Allied’s insurer, Lexington Insurance
Company, retained counsel and had Buckley’s claim removed to federal district court. Meanwhile, Allied
filed Chapter 11 bankruptcy proceedings. On December 4, 2001, Buckley had the bankruptcy stay lifted
and proceeded with his claim against Allied.
¶10.
In October of 2002, Buckley and Lexington, on Allied’s behalf, attended a conference aimed at
developing the prospects of settling Buckley’s claim. Accordingly, the parties reached a tentative
settlement agreement. Lexington offered to pay Buckley $140,000, provided Allied and the creditor
committee in the bankruptcy proceeding withdrew their pending claims against Allied’s policy and any
proceeds from that policy.
¶11.
Buckley’s attorney responded with a letter and accepted the terms, but Buckley added the
condition that Lexington must tender the $140,000 within ten days of the date of the mailing of Buckley’s
response letter. While Buckley claims that his response to Lexington’s offer constituted a valid acceptance,
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Lexington disputes that claim and argues that Buckley, by adding the condition of payment within ten days,
actually tendered a counteroffer. However, this dispute is immaterial to the present issues, which will
become clearer as this opinion proceeds. At any rate, Buckley did not receive payment within ten days.
Lexington claims the delay occurred as a result of Allied’s bankruptcy proceedings. That is, Lexington
could not acquire the funds until it could be sure that, in so doing, it had clearance from Allied and the
bankruptcy creditor committee. Rather than moving forward with his claim, Buckley attempted to enforce
the settlement.
B.
Buckley Attempts to Enforce the Settlement of Claim One
¶12.
Buckley sought two avenues to enforce the settlement. First, Buckley went to the federal district
court and filed his motion to enforce the settlement. The federal district court granted Buckley’s motion
to enforce and ordered Lexington to pay Buckley $140,000 within seven days of the filing of that order.
Lexington appealed the order enforcing the settlement, but the record is silent as to the results of that
appeal. Buckley’s second attempt at enforcing the settlement would eventually give rise to this appeal.
C.
Claim Two
¶13.
On December 31, 2002, Buckley filed a complaint in the Covington County Chancery Court. In
his complaint, titled “Complaint for Specific Performance and Other Relief,” Buckley asserted claims for
(1) tortious interference with a settlement agreement, (2) intentional infliction of emotional distress, (3)
breach of contract, and (4) specific performance of the settlement agreement. As for damages, Buckley
requested “specific performance of the [s]ettlement [a]greement, plus interest since November 1, 2002,
attorneys fees, costs, interest, and all compensatory and punitive damages allowed by law.” Buckley also
requested “all other relief, either general or specific, as he may be entitled to.”
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¶14.
On February 14, 2003, Buckley filed his first amended complaint. Buckley amended the requested
damages portion of his original complaint. Though the requested damages in his original request were open
and non-specific, Buckley’s amended request sought relief “not to exceed $74,500.”
¶15.
On February 26, 2003, Lexington paid Buckley the $140,000 contemplated in their settlement
agreement. Consequently, Lexington paid Buckley the amount of money that Buckley sought in his specific
performance action. Regardless, Buckley’s specific performance action proceeded in the chancery court.
¶16.
On April 7, 2003, Buckley attended a hearing before the Covington County Chancery Court. No
one was present for Lexington or Allied, and Lexington had not answered Buckley’s complaint or entered
an appearance. Still, Buckley and the chancery court set a trial date for April 10, 2003.
¶17.
On April 8, 2003, Buckley filed his second amended complaint. Again, Buckley amended his
damages request. While his first amended complaint modified his damages request to $74,500, Buckley’s
second amended complaint was non-specific as to the requested damages. Like his original complaint,
Buckley’s second amended complaint modified his damages to a request for “interest on $140,000 from
November 1, 2002, to February 28, 2003, attorneys’ fees, costs, interest, and all compensatory and
punitive damages allowed by law.” Buckley also modified his request to include “all other relief, either
general or special, as he may be entitled to.”
¶18.
On April 10, 2003, Buckley showed up for trial, but no one was present for Lexington. Likewise,
Lexington had not responded to any of Buckley’s three complaints, or entered an appearance. The
chancellor had Buckley put forth evidence from two witnesses, as well as eleven exhibits. After the trial,
the chancellor entered the following judgment:
THIS CAUSE having come on for hearing on its merits and the Court after taking
evidence, having heard testimony of two witnesses and reviewing eleven exhibits identified
and admitted.
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FINDS:
1.
Lexington Insurance Company failed to answer or plead and is defaulted.
2.
Charles Buckley suffered severe emotional distress and mental injury as
a result of the unreasonable and vexatious conduct of Lexington Insurance
Company.
WHEREFORE IT IS ORDERED THAT the Plaintiff, Charles Buckley is hereby
awarded the sum of $75,000.00 for compensatory damages for his injuries sustained, plus
the sum of $37,500.00 in actual attorney’s fees and the sum of $1,012,500.00 as punitive
damages, for a total judgment of $1,125,000.00 against Lexington Insurance Company.
D.
Proceedings Following the Judgment
¶19.
According to Lexington, it first heard about the judgment on or about May 20, 2003. Lexington
filed two motions after it heard about the default judgment. On June 3, 2003, Lexington filed its first
posttrial motion: a motion to extend time for appeal or, alternatively, to reopen time for an appeal. On June
9, 2003, the chancellor entered an order and granted Lexington’s motion to extend time for appeal.
Lexington appealed the chancellor’s April 10th judgment. That appeal is one of the present consolidated
appeals.
¶20.
Also on June 9, 2003, Lexington filed its second posttrial motion: a motion to set aside the April
10th default judgment. On June 19, 2003, Buckley filed his motion to reconsider Lexington’s extension
of time to appeal. On August 15, 2003, the parties conducted a hearing on two motions: Lexington’s
motion to set aside the judgment, and Buckley’s motion to reconsider Lexington’s extension of time. The
chancellor denied both motions. The other consolidated appeal follows the chancellor’s denial of
Lexington’s motion to set aside the judgment.
STANDARD OF REVIEW
¶21.
We examine two consolidated appeals. The first appeal is of the chancery court judgment. The
second appeal is of the chancellor’s decision to deny a motion to set aside the judgment. “When reviewing
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fact-based findings, we will only examine whether the trial court abused its discretion and whether there
was substantial evidence supporting the determination.” Triple “C” Transport, Inc. v. Dickens, 870
So.2d 1195 (¶15) (Miss. 2004) (citations omitted). We review a question of law de novo. Id.
ANALYSIS
I.
Is the judgment against Lexington void based on defective service of process?
¶22.
Lexington finds fault with the service of process incident to this matter. Lexington claims that the
chancery court judgment is void for lack of personal jurisdiction. Buckley maintains that service of process
was appropriate under Rule 4 of the Mississippi Rules of Civil Procedure and Section 83-21-37 of the
Mississippi Code.
¶23.
If Buckley failed to comply with the standards governing adequate service of process, then the
chancery court lacked personal jurisdiction over Lexington. If the chancery court lacked personal
jurisdiction over Lexington, then the judgment is invalid because “no judgment order or decree is valid or
binding upon a party who has had no notice of the proceeding against him.” James v. McMullen, 733
So.2d 358 (¶3) (Miss. Ct. App. 1999).
¶24.
Lexington is not incorporated in Mississippi. It has no registered agent for service of process here.
For all intents and purposes, Lexington is a nonresident of Mississippi. “The Due Process Clause of the
Fourteenth Amendment operates as a limitation on the jurisdiction of state courts to enter judgments
affecting rights or interests on nonresident defendants.” Noble v. Noble, 502 So.2d 317, 319-20 (Miss.
1987) (quoting Kulko v. California Superior Court, 436 U.S. 84, 91 (1978)). “When a defendant is
a non-resident of the state . . . and the court has jurisdiction of the subject matter, it is necessary that
complainants be able to obtain process on a non-resident defendant by some means; otherwise, parties
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would not be able to enforce their rights in a judicial proceeding.” Mosby v. Gandy, 375 So.2d 1024,
1030 (Miss. 1979). Thus, to enter a valid judgment, a “court must not only have jurisdiction of the subject
matter, but also of the persons of the parties to give validity to its final judgment.” James v. McMullen,
733 So.2d 358 (¶3) (Miss.Ct.App.1999) (citing Rice v. McMullen, 207 Miss. 706, 727, 43 So.2d 195,
201 (1949)).
¶25.
“The concept of personal jurisdictioncomprises two distinct components: amenability to jurisdiction
and service of process.” James, 733 So.2d at (¶3). “Service of process is simply the physical means by
which [personal] jurisdiction is asserted.” Id. (citations omitted). “The existence of personal jurisdiction
. . . depends upon the presence of reasonable notice to the defendant that an action has been brought.”
Noble, 502 So.2d at 320 (quoting Kulko, 436 U.S. at 91).
¶26.
Under the present circumstances, Buckley intended to utilize statutory provisions to effectuate
reasonable notice through service of process. Our analysis mandates consideration of two overriding
issues; (1) whether Buckley was entitled to serve process under the relevant provisions and (2) whether
Buckley followed the logistic provisions necessary to complete proper service of process.
1.
Could Buckley serve the Mississippi Insurance Commissioner?
¶27.
Buckley attempted to serve Lexington with process by mailing a copy of the summons and
complaint to George Dale, the Mississippi Insurance Commissioner. It is undisputed that Dale is not
Lexington’s registered agent for service of process. Still, Mississippi law dictates that, under specific
circumstances, service upon the insurance commissioner may be sufficient to effectuate service of process
on an out-of-state insurer. Pursuant to Section 83-21-37 of the Mississippi Code, upon certain events,
an unauthorized insurer appoints the Mississippi Insurance Commissioner as a statutory agent for service
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of process. Buckley contends that service of process was valid under Section 83-21-37 because
Lexington acted in compliance with the methods for statutory appointment of the Mississippi Insurance
Commissioner.
¶28.
The legislature was specific as to what events constitute statutory appointment:
Any of the following acts in this state, effected by mail or otherwise, by an unauthorized or
alien insurer: (1) the issuance or delivery of contracts of insurance to residents of this state
or to corporations authorized to do business therein, (2) the solicitation of applications for
such contracts, (3) the collection of premiums, membership fees, assessments, or other
considerations for such contracts, or (4) any other transaction of insurance business is
equivalent to and shall constitute an appointment by such insurer of the commissioner of
insurance and his successor or successors in office to be its true and lawful agent, upon
whom may be served all lawful process in any action, suit, or proceeding instituted by or
on behalf of an insured or beneficiary arising out of any such contract of insurance, and any
such act shall be signification of its agreement that such service of process is of the same
legal force and validity as personal service of process in this state upon such insurer.
Miss. Code Ann. § 83-21-37 (Rev. 1999). So, for Buckley’s service of process upon Dale to be
appropriate, Lexington must have acted according to one of the four contemplated actions equating to
statutory appointment.
¶29.
The first instance by which an insurer appoints the insurance commissioner is where the insurer
issues or delivers contracts of insurance to Mississippi residents or to corporations authorized to do
business in Mississippi. Miss. Code Ann. § 83-21-37. Section 83-5-5 of the Mississippi Code defines
a contract of insurance as “an agreement by which one party for a consideration promises to pay money
or its equivalent, or to do some act of value to the assured, upon the destruction, loss, or injury of
something in which the assured or other party has an interest, as an indemnity therefor.”
¶30.
Assuming the settlement agreement was valid, clearly one party, Lexington, promised to pay
Buckley a sum of money. However, the offer to pay money was not incident to the loss of something.
Rather, Lexington offered to pay Buckley money because of the existence of Buckley’s claim against
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Lexington’s insured, Allied Products. As such, Buckley could not serve Lexington due to Lexington’s
issuance or delivery of insurance contracts, as no evidence in the record supports such a finding. So
Lexington did not act in accordance withthe first instance comprising statutory appointment of the insurance
commissioner as Lexington’s agent for service of process.
¶31.
The second instance by which an insurer appoints the insurance commissioner as its registered
agent for service of process occurs when the insurer solicits applications for insurance contracts. Miss.
Code Ann. § 83-21-37 (Rev. 1999). There is no proof in the record that Lexington solicited applications
for insurance contracts to Mississippi residents or corporations licensed to do business in Mississippi.
Likewise, Buckley does not allege that Lexington solicited such applications. Accordingly, we rule out the
possibility that Lexington appointed Dale when Lexington solicited Mississippi residents for applications
for insurance contracts. So Lexington did not act in accordance with the second instance comprising
statutory appointment of the insurance commissioner as Lexington’s agent for service of process.
¶32.
The third instance in which an insurer appoints the insurance commissioner occurs when the insurer
collects premiums or other valuable consideration. Miss. Code Ann. § 83-21-37 (Rev. 1999). Like the
second instance, there is no proof in the record that Lexington acted accordingly, nor does Buckley allege
such. Thus, we do not find that Lexington appointed Dale due to Lexington’s collection of insurance
premiums. So Lexington did not act in accordance with the third instance comprising statutory appointment
of the insurance commissioner as Lexington’s agent for service of process.
¶33.
Finally, the last instance in which an insurer appoints the insurance commissioner occurs when an
insurer conducts any other transaction of insurance business. Miss. Code Ann. § 83-21-37 (Rev. 1999).
The statute does not specifically define what constitutes conducting a transaction of insurance business.
Whether Lexington was conducting a transaction of insurance business when it negotiated a settlement on
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behalf of its insured is questionable. Still, it is unnecessary to determine whether Lexington’s conduct fits
within the criteria of “conducting insurance business” if Buckley did not follow the proper procedures for
effectuating service of process. Assuming, for the sake of argument, that negotiating a settlement of a claim
on behalf of an insured constitutes a transaction of insurance business, Buckley must still follow proper
procedures to effectuate valid service of process.
2.
Did Buckley follow the statute governing proper service of process?
¶34.
Buckley attempted to serve process on Lexington by mailing a copy of the summons and complaint
to George Dale, the Mississippi Commissioner of Insurance. Lexington claims that Buckley failed to follow
the necessary procedures in effectuating proper service of process. Buckley contends that service of
process on the insurance commissioner was valid pursuant to Section 83-21-39 of the Mississippi Code
of 1972 and Rule 4 of the Mississippi Rules of Civil Procedure.
¶35.
Section 83-21-39 of the Mississippi Code sets forth a specific procedure for service of process:
Such service of process shall be made by delivering to and leaving with the commissioner
of insurance, or some person in apparent charge of his office, two (2) copies thereof and
the payment to him of such fees as may be prescribed by law. The commissioner of
insurance shall forthwith mail by registered mail or certified mail one of the copies of such
process to the defendant at its last known principal place of business, and shall keep a
record of all process so served upon him. Such service of process is sufficient, provided
notice of such service and a copy of the process are sent within ten (10) days thereafter
by registered mail or certified mail by plaintiff or plaintiff's attorney to the defendant at its
last known principal place of business, and the defendant's receipt, or receipt issued by the
post office with which the letter is registered, showing the name of the sender of the letter
and the name and address of the person to whom the letter is addressed, and the affidavit
of the plaintiff or plaintiff's attorney showing a compliance herewith are filed with the clerk
of the court in which such action is pending on or before the date the defendant is required
to appear, or within such further time as the court may allow.
Miss. Code Ann. § 83-21-39 (Rev. 1999).
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¶36.
Accordingly, the first step in service of process under Section 83-21-39 is to “deliver and leave
with the commissioner of insurance, or some person in apparent charge of his office, two copies of the
summons and complaint.” Id. Lexington reasons that Buckley failed to “deliver and leave” the summons
and complaint with the insurance commissioner when Buckley mailed the summons and complaint to
George Dale. Lexington claims that the law requires personal service of process on Dale, the Mississippi
Insurance Commissioner.
¶37.
Section 83-21-39 does not specifically define what “deliver and leave with” entails. That
description suggests that a plaintiff must execute personal service of process. That is, while one could
accomplish “delivery” by mail, it is impossible to deliver “and leave with” by mail. To leave something,
someone must personally present that something. So, unless a process server personally delivers the
summons and complaint, it is impossible to leave a summons and complaint.
¶38.
Despite the fact that Section 83-21-39 does not specifically state that “deliver and leave with”
equates to personal service of process, the Mississippi Rules of Civil Procedure are dispositive of this issue.
The Mississippi Rules of Civil Procedure control “where no statute applicable to the proceedings provides
otherwise or sets forth procedures inconsistent with” a provision of the Rules of Civil Procedure. M.R.C.P.
1. The rules for service of process are contained in Rule 4 of the Mississippi Rules of Civil Procedure.
Section 83-21-39 does not address the means for delivering service of process. Nor does that statute
provide for procedures of delivering service of process inconsistent with Rule 4. As such, Rule 4 controls
where Section 83-21-39 is silent or nonspecific. E.g., M.R.C.P. 1. So, we turn to Rule 4 to resolve
whether Buckley may serve the insurance commissioner, whose office is located in Mississippi, by certified
mail.
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¶39.
In Triple “C” Transport, 870 So.2d at (¶21), the Mississippi Supreme Court held that “[s]ervice
of process may not be had by certified mail upon an in-state defendant.” Undoubtably, Lexington is not
an “in-state” defendant, but their alleged statutory agent for service of process is a Mississippi resident, and
it was the insurance commissioner that Buckley served. “The comment to [Rule 4(c)(5)] provides that
‘[t]he certified mail procedure is not available to serve a person within the state.’” Id. Accordingly, the
certified mail procedure is not available to serve the insurance commissioner.
¶40.
Moving on, the second requirement under Section 83-21-39 mandates that “[t]he commissioner
of insurance shall forthwith mail by registered mail or certified mail one of the copies of such process to the
defendant at its last known principal place of business, and shall keep a record of all process so served
upon him.” The insurance commissioner fulfilled his statutory obligation to mail a copy of the summons and
complaint to Lexington when Dale sent Lexington a copy of the summons and complaint by certified mail,
return receipt requested. The record contains the return receipt. Suffice it to say, Dale fulfilled the second
statutory step.
¶41.
However, Buckley was obligated to send Lexington, via certified mail, notice of service and a copy
of process within ten days after Buckley served Dale with process. Miss. Code Ann. § 83-21-39. The
record contains no evidence suggesting that Buckley fulfilled this step. What is more, two additional filings
are necessary to complete service of process under Section 83-21-39: Buckley should have filed
Lexington’s receipt with the court clerk, and Buckley should have filed an affidavit of compliance with the
court clerk. As mentioned, the return receipt incident to Dale’s obligation to send a copy of the summons
and complaint to Lexington does appear in the record. There is no other return receipt incident to Buckley
sending Lexington notice of service and a copy of process within ten days of serving Dale. Moreover, the
record does not contain Buckley’s filed affidavit of compliance.
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¶42.
As it stands, Buckley improperly served process via certified mail to a person within the state. No
evidence suggests that Buckley mailed the notice of service to Lexington since the return receipt incident
to such a mailing does not appear in the record. Likewise, Buckley failed to comply with Section 83-21-39
because the record contains no evidence that Buckley filed his affidavit of compliance. Consequently,
Buckley did not complete service of process.
¶43.
Still, Buckley contends that the return receipt demonstrates that Lexington received Dale’s certified
letter, along with a copy of the summons and complaint on February 10, 2003. The statute is clear. Dale’s
obligation to send a copy of the summons and complaint to Lexington is only one obligation under the
statute. Section 83-21-39 does not provide that service of process is proper where a plaintiff meets the
obligations that he chooses, nor does it provide that service of process is proper where the plaintiff meets
some or most of the obligations listed. Rather, Buckley had to fulfill every obligation under the statute. The
evidence and record before this Court demonstrates that Buckley failed in that regard.
¶44.
Moreover, the Mississippi Supreme Court has dictated that “actual knowledge by a defendant of
the pendency of a suit against him is immaterial, unless there has been a legal summons or a legal
appearance.” James, 733 So.2d at (¶3) (citations and internal quotations omitted). “In the absence of
process on a defendant, even though the defendant may know of the pendency of the action, defendant's
knowledge of the existence of the action does not supply the want of compliance with requirements of valid
process.” Mosby v. Gandy, 375 So.2d 1024, 1027 (Miss. 1979).
¶45.
“Service of process on a non-resident defendant is jurisdictional, requiring strict compliance with
statutory procedures.” Birindelli v. Egelston, 404 So.2d 322, 323-34 (Miss. 1981). Since Buckley
failed to serve appropriate process on Lexington, the chancery court lacked jurisdiction to grant a judgment
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in Buckley’s favor. Unfortunately, this matter does not end with resolution of this issue. We now turn to
the judgment against Lexington.
II.
THE JUDGMENT
¶46.
There has been much confusion on the topic of the judgment, and rightfully so. Lexington never
responded to Buckley’s complaint and never entered an appearance, but the chancellor granted a judgment
after a trial on the merits. The chancellor specifically stated that the judgment was not a default judgment,
despite the language in the judgment citing Lexington’s default. So, what type of judgment was it?
¶47.
The judgment stated that “Lexington Insurance Company failed to answer or plead and is
defaulted.” However, during the August 15, 2003 hearings, the chancellor stated that the judgment was
not a default judgment. What is more, during the hearing, the chancellor clarified his reasoning on why the
judgment was not a default judgment. When counsel for Lexington pointed out that the record did not
contain the court clerk’s entry of default, the chancellor explained “[y]ou won’t ever find [an entry of
default] in mine. I don’t let my clerks file them.” The chancellor elaborated:
I do not let [the clerks enter default]. I set the cases. I set cases for trial. I have docket calls every time
I have trial. If somebody does not answer, I set the case for trial and we try it. If somebody is not there,
then technically they are in default, but I don’t consider it as a default. I consider it as them not being there,
and putting on whatever testimony they want to put on. So my clerks have been instructed by me not to
enter defaults because I’m not going to enter a judgment based on defaults. There’s no sense in cluttering
up the file.
Later during the same hearing, the chancellor further elaborated on his procedure:
The chancellor: So you’re taking this that I gave them a default judgment, is that your
position?
Lexington:
Yes, sir. That’s what the judgment says, that they were defaulted.
The chancellor: No. It didn’t say they were defaulted. It just says they are in default which --
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Lexington:
Lexington Insurance Company failed to answer a plea and is defaulted.
The chancellor: Okay.
Lexington:
David [Shoemake] prepared it.
The chancellor: Okay.
Lexington:
If you look at 54(c). I have given the Court as tab C there - -
The chancellor: I’m going to be real honest, I don’t need to hear anything because as far as - - if
your sole basis is arguing that that was a default judgment, then I can overrule your
motion right now and you can take it to the Supreme Court ever how you want to
take it because I heard the case. I set it at docket call. The people were in default
in that they did not answer. I did grant - - it was never the intention of this court
and I think the record will reflect that. I may be wrong, but I don’t think anywhere
in there I said I’m giving you a default judgment. I think I said I’m giving you a
judgment for this, this, this and this.
Thus, the chancellor specifically stated that it was his intent that the judgment was not a default judgment,
but a trial on the merits.
¶48.
Again, we turn to the Mississippi Rules of Civil Procedure. “When a party against whom a
judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules
and that fact is made to appear by affidavit or otherwise, the clerk shall enter his default.” M.R.C.P. 55(a).
The Rule does not offer any room for discretion. When a party does not plead or otherwise defend a
claim, the clerk is directed to enter a default. It is undisputed that Lexington did not answer or plead in
response to Buckley’s complaint. The proper procedure would have been to pursue a default judgment,
as Rule 55 does not offer the option in the use of the word “shall.” If Rule 55 said that the clerk may enter
default, it might be otherwise, but the Rule is clear. The chancellor erred by conducting a trial on the merits.
BUCKLEY’S CROSS - APPEAL
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¶49.
Having found that the chancery court lacked jurisdiction to award a default judgment against
Lexington, there is no need to consider the merits of Buckley’s cross-appeal.
CONCLUSION
¶50.
This case proceeded by flawed procedure from its inception. Not only did Buckley fail to serve
process, but the chancellor erred when he failed to follow our rules of civil procedure. Because the
chancery court lacked personal jurisdiction to enter a judgment following an improper trial on the merits,
it is unnecessary to delve into the questionable amendment of complaints and whether the chancellor should
have granted Lexington’s motion for extension of time to appeal. Regardless, the chancery court lacked
personal jurisdiction over Lexington. In default cases, where proper service of process is not shown in the
record, the default judgment is void. Williams v. Kilgore, 618 So.2d 51, 56 (Miss. 1992). Finding the
judgment void, we reverse the chancery court’s judgment and render judgment for Lexington.
¶51. THE JUDGMENT OF THE COVINGTON COUNTY CHANCERY COURT IS
REVERSED AND RENDERED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE
APPELLEE.
KING, C.J., LEE, P.J., MYERS, CHANDLER, GRIFFIS, BARNES AND ISHEE, JJ.,
CONCUR. IRVING, J., NOT PARTICIPATING.
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