Opinion
C.A. No. 07C-05-039 JTV.
Submitted: November 30, 2007.
Decided: December 31, 2007.
Upon Consideration of Defendant's Motion for Default Judgment DENIED.
Scott E. Chambers, Esq., Schmittinger Rodriguez, Dover, Delaware. Attorneyfor Plaintiff.
Daniel L. McKenty, Esq., and Gerald J. Hager, Esq., Heckler Frabizzio, Wilmington, Delaware. Attorney for Defendant.
ORDER
Upon consideration of the defendant's Motion for Relief From Default Judgment, the plaintiff's opposition, and the record of the case, it appears that:
1. On August 14, 2005, the plaintiff, Joseph Insley, was injured in a motor vehicle accident. The vehicle he occupied was insured by the defendant, State Farm Mutual Automobile Insurance Company. The plaintiff filed a complaint for PIP benefits on May 29, 2007. It was served on the defendant on June 5, 2007. No answer was filed within the time required under the rules, and on August 9, 2007, the plaintiff took default judgment by direction to the Prothonotary under Superior Court Civil Rule 55(b)(1).
2. The motion for relief from default judgment is supported by the affidavit of Mary Lynch, a claims representative. She avers that her supervisor left a copy of the summons and complaint on her desk on June 5, 2007 for the purpose of her forwarding them to State Farm counsel; that upon her return, the summons and complaint were no longer on her desk; and that as such, she believed that they were sent to State Farm counsel. In the motion itself, the defendant further states that Ms. Lynch received the papers from her supervisor, that she left them on her desk, and when she returned they were no longer there. Ms. Lynch believed that her secretary forwarded the summons and complaint to State Farm counsel. To date, Ms. Lynch has been unable to locate the summons and complaint. Based upon the motion and the arguments of counsel, it appears that the claims representative was aware that she had received a summons and complaint, but, once it was no longer on her desk, had no way to identify it.
3. On October 11, 2007, defense counsel entered his appearance. He filed the present motion to vacate the default judgment on November 21, 2007.
4. The defendant contends that it has meritorious defenses. It further contends that the plaintiff will not suffer any prejudice if the Court vacates the default judgment and allows the defendant to answer the complaint, whereas it will be substantially prejudiced if not afforded an opportunity to present its defenses. It contends that under Superior Court Civil Rule 60 and the underlying policy which favors that cases be decided on their merits, the Court should exercise its discretion to vacate the default judgment.
5. Under Superior Court Civil Rule 60(b)(1), the Court may relieve a party from a final judgment for "mistake, inadvertence, . . . or excusable neglect." Under 60(b)(6), the Court may grant such relief for any other reason justifying relief from the operation of the judgment. It is well-settled that decisions on motions to open default judgments and allow defendants to appear and defend pursuant to Rule 60(b)(1) and (6) are within the sound discretion of the Court. Rule 60(b) should be liberally construed because sound public policy favors determination of actions on the merits, which are considered superior to default judgments. In support of this policy, the Court should resolve any doubt in favor of the petitioner. Nevertheless, the petitioner must establish three elements before a Rule 60(b) motion will be granted: (1) mistake or excusable neglect; (2) a meritorious defense that would allow a different outcome if the matter was heard on the merits; and (3) a showing that substantial prejudice will not be suffered by the plaintiff if the motion is granted. The Court should consider the possibility of a meritorious defense or possible prejudice only if a satisfactory explanation has been established for failing to answer the complaint, such as excusable neglect or inadvertence. Excusable neglect is "neglect which might have been the act of a reasonably prudent person under the circumstances." "A mere showing of negligence or carelessness without a valid reason may be deemed insufficient" to establish excusable neglect. Relief under 60(b)(6) is an extraordinary remedy for which the Court applies the extraordinary circumstances test permitting the Court to vacate judgments when appropriate to accomplish justice.
Battaglia v. Wilmington Sav. Fund Soc'y, 379 A.2d 1132, 1135 (Del. 1977).
Model Fin. Co. v. Barton, 188 A.2d 233, 234-35 (Del.Super. 1968); see also Battaglia, 379 A.2d at 1135 (noting that policy favors a trial on the merits to a judgment based on a default); Keystone Fuel Oil Co. v. Del-Way Petroleum, Inc., 364 A.2d 826, 828 (Del.Super. 1976) (recognizing that policy prefers that a defendant have his day in court).
Mendiola v. State Farm Mut. Auto. Ins. Co., 2006 Del. Super. LEXIS 181, at *7; Cohen v. Brandywine Raceway Ass'n, 238 A.2d 320, 325 (Del.Super. 1968).
Mendiola, 2006 Del. Super. LEXIS 181, at *7-8; see also McMartin v. Quinn, 2004 Del. Super. LEXIS 28, at *10 (noting that the petitioner "need not show definitively that there would have been a different result, just that there is the possibility of a different result").
Mendiola, 2006 Del. Super. LEXIS 181, at *8.
Id. (internal quotation marks omitted).
Id. (internal quotation marks omitted).
Id. at *13.
6. In Mendiola v. State Farm Mutual Automobile Insurance Co., a State Farm employee "signed" for the complaint in the case at a regional office. State Farm's employees "mistakenly assumed" that the complaint was duplicative of another, earlier filed action, because of similarities in captions, the parties' names, and the court involved. The Court in that case concluded that the conduct of the State Farm employees did not constitute mistake, inadvertence or excusable neglect. In reaching this conclusion, the Court noted that State Farm's employees had deviated from established procedures and failed to adequately process the complaint.
Id. at * 3-4.
Id. at * 4.
Id. at *10.
Id.
7. Although it is not contended in this case that the claims representative did not follow established procedures, I do not think that State Farm's case for relief from the judgment is any better here than it was in Mendiola. How or why the claims representative would infer that the papers had been forwarded to counsel from the fact that they were no longer on her desk is not adequately explained. In addition, although I am mindful that the claims representative's situation was complicated by the fact that she was at a loss to know the party name or other identity of the papers, it would seem that prudence would call for some effort to reconstruct the identity of the papers and verify that they had, in fact, been properly forwarded. Here there is no evidence that the defendant made any effort to reconstruct from counsel what papers she had received from the State Farm office at or about the time in question, or what papers had been forwarded to State Farm from the Insurance Commissioner's office at or about the time in question, or what suits had been filed in this Court against State Farm at or about the time in question. Perhaps such efforts would not have been successful, but the apparent absence of any such effort is significant in assessing whether the standard for granting relief under the rule has been satisfied. My conclusion is that State Farm has not demonstrated mistake, inadvertence or excusable neglect sufficient to grant relief from the judgment.
8. There are no extraordinary circumstances involved here under Rule 60(b)(6).
9. The defendant's motion is denied .
IT IS SO ORDERED.