Greitzer v. Eastham

Annotate this Case

119 S.E.2d 884 (1961)

254 N.C. 752

Lottie Elliott GREITZER v. John Albert EASTHAM, Jr.

No. 306.

Supreme Court of North Carolina.

May 24, 1961.

White & Aycock, Kinston, for plaintiff.

Whitaker & Jeffress, Kinston, for defendant.

DENNY, Justice.

The decisions on the subject now before us are not entirely satisfactory with respect to their consistency. In fact, many of them are irreconcilable. Sutherland v. McLean, 199 N.C. 345, 154 S.E. 662.

In the instant case, the court below was not requested to find the facts. Therefore, it will be presumed that the court declined to set aside the judgments on the facts as alleged in the complaint, the motion of the defendant and the affidavits filed in support thereof. Crissman v. Palmer, 225 N.C. 472, 35 S.E.2d 422.

In the case of Holcomb v. Holcomb, 192 N.C. 504, 135 S.E. 287, Stacy, C. J., speaking for the Court, said: "This is an appeal from a refusal to set aside a judgment by default final on the ground of `mistake, inadvertence, surprise or excusable neglect,' under C.S., 600 (now G.S. ยง 1-220). The judge, not being requested to do so, found no facts upon which he based his ruling. Carter v. Rountree, 109 N.C. 29, 13 S.E. 716. In the absence of such finding, it is presumed that the judge, upon proper evidence, found facts sufficient to support his judgment. McLeod v. Gooch, 162 N.C. 122 (78 S.E. 4). Hence there is nothing for us to review. Osborn v. Leach, 133 N.C. 428, 45 S.E. 783. `We do not consider affidavits for the purpose of finding facts ourselves in motions of this sort.' Gardiner v. May, 172 N.C. 192, 89 S.E. 955. It would have been error for the judge not to have found the facts, had he been requested to do so. McLeod v. Gooch, supra."

A defendant is not entitled to have a judgment by default set aside in the absence of a showing by him and a finding by the court that his neglect was excusable and that he had a meritorious defense to plaintiff's cause of action. Wilson v. Chandler, 238 N.C. 401, 78 S.E.2d 155; Stephens v. Childers, 236 N.C. 348, 72 S.E. *887 2d 849; Perkins v. Sykes, 233 N.C. 147, 63 S.E.2d 133; Whitaker v. Raines, 226 N.C. 526, 39 S.E.2d 266; Johnson v. Sidbury, 225 N.C. 208, 34 S.E.2d 67.

In the absence of a showing of excusable neglect, the question as to whether or not the defendant has a meritorious defense becomes immaterial. Stephens v. Childers, supra; Pate v. R. L. Pittman Hospital, 234 N.C. 637, 68 S.E.2d 288; Van Hanford v. McSwain, 230 N.C. 229, 53 S.E.2d 84; Craver v. Spaugh, 226 N.C. 450, 38 S.E.2d 525.

In the case of Stephens v. Childers, supra, summons and a verified complaint were duly served upon the defendant on 31 January 1952. The day following service of suit papers upon the defendant notice thereof was given by telephone to his liability insurer's agent in Hickory, North Carolina. In the telephone conversation the insurance agent requested that the suit papers be forwarded to him by mail, and this was done the next day, 2 February. The insurance agent, under date of 4 February, forwarded the papers by mail to the Resident Adjuster of the defendant's liability insurance carrier, at his office in Charlotte. The Resident Adjuster contacted the defendant and assured him that the insurance company would undertake the defense of the litigation and would take all necessary steps to employ counsel and protect the interest of the defendant, and that it would not be necessary for the defendant to employ legal counsel. Counsel was employed, but not until after a default judgment had been obtained. This Court said [236 N.C. 348, 72 S.E.2d 851]: "All the evidence tends to show that the insurance company assumed the responsibility of defending the action for the defendant with his full knowledge and consent, under circumstances which constituted the insurance company the agent of the defendant for the purpose of employing counsel and arranging for the defense of the action. On this record the negligence of the insurance company was inexcusable and clearly imputable to the defendant.

"The rule is established with us that ordinarily the inexcusable neglect of a responsible agent will be imputed to the principal in a proceeding to set aside a judgment by default. Stallings v. Spruill, 176 N.C. 121, 96 S.E. 890."

In the case of Faircloth v. Ohio Farmers Insurance Co., 253 N.C. 522, 117 S.E.2d 404, 408, it is stated: "This Court said in National Life Ins. Co. v. Grady, 185 N.C. 348, 117 S.E. 289, 291: `Another principle recognized in this jurisdiction and pertinent to the inquiry is that, in the absence of fraud or collusion between the insured and the agent, the knowledge of the agent when acting within the scope of the powers entrusted to him will be imputed to the company, though a direct stipulation to the contrary appears in the policy or the application for the same.'"

In the present case, the defendant promptly reported the accident to the agent of his insurance carrier, and was assured that the company would look after it. When the summons and complaint were served on the defendant he took them and delivered them to the agent, and the agent handed them back to the defendant and again informed him that the company would look after the matter.

Under the decision in Stephens v. Childers, supra, the defendant made the insurance company and its agent his agents, to look after and defend the action, and their negligence was imputable to the defendant.

The failure of the agent of the defendant's liability insurance carrier in the present case to take the suit papers when they were delivered to him in his office and to take such steps as might be necessary to a proper defense of the action, was inexcusable.

On the record before us, in our opinion, the ruling of the court below must be upheld.