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Lawskills.com Georgia Caselaw
FIRST NATIONAL INSURANCE COMPANY OF AMERICA v. THAIN.
39801.
Action on insurance policy. Columbia Superior Court. Before Judge Anderson.
EBERHARDT, Judge.
Excusable neglect authorizing the opening of a default, as contemplated by Code 110-404, as amended, is that neglect which might have been the act of a reasonably prudent person under the same circumstances, particularly when the neglect results from reliance upon the promised action of the opposite party in obtaining what was supposed or thought to be a valid extension of time for the filing of defensive pleadings.
Plaintiff (defendant in error) filed suit against defendant insurance company (plaintiff in error) on August 4, 1961, in Columbia Superior Court seeking to recover on a fire insurance policy as follows: $3,919.29 damage to his house, $352.58 increased living expenses occasioned by the fire loss, $1,066 penalty, and $4,650 attorney's fees because of alleged bad faith in refusing to pay the amount of his loss, a total of $9,987.87. Service was perfected on the defendant August 11, 1961, with a resulting appearance day of September 10, 1961. 1 On August 31, 1961, plaintiff's attorney procured from the court an order extending the time for filing defensive pleadings "an additional fifteen days," and on September 13, 1961, he procured, an order further extending the time an additional 45 days.
It appears that there was another insurance policy with another company covering the same loss and that plaintiff was negotiating with both companies for a settlement. A settlement agreement was reached with defendant, pursuant to which drafts were issued and sent to plaintiff's attorney, but these were returned because no settlement had been reached with the other company.
On November 9, 1961, defendant filed a motion to open a default. To that motion plaintiff demurred generally. After the motion was twice amended, the demurrer was renewed, and on December 19, 1961, it was sustained.
The case was tried and resulted in a jury verdict for plaintiff in the amount sued for on the fire damage and increased living expenses and $500 on the penalty. By agreement the court tried the attorney's fees issue and awarded $4,000. Defendant's motion for new trial as amended was overruled.
Exception is to the sustaining of the demurrer to the motion to open the default and to the overruling of the motion for new trial.
1. Both parties agree that the case was in default at the time the motion to reopen was filed, although different reasons are advanced. Defendant's motion to reopen, as amended, alleged "excusable neglect" on its part, one of the grounds for opening a default under Code Ann. 110-404. The plaintiff's general demurrer to the motion was sustained, the effect of which was to rule that the motion did not set out any excusable neglect on the defendant's part. Thus, the discretion which the trial judge is said to have by virtue of Code 110-404, as amended, does not come into play.
What facts will be sufficient to constitute excusable neglect? "We would that we might deduce from the numerous cases some fixed rule by which to determine questions of this character, but the task is legally impossible . . . [and] 'cannot be determined by any fixed rule, but depends upon the circumstances of the case.' . . . The wide divergence apparently existing in the authorities is not the result or the evidence of a confusion of the law, but indicates merely the breadth of the field of the discretionary power which is vested in the judges in matters of this kind." Sherman v. Stephens, 30 Ga. App. 509, 519 (118 SE 567). See Deen v. Baxley State Bank, 192 Ga. 300, 303 (15 SE2d 194) and citations.
"Punctuality is a virtue of high order, but truth and justice are even more exalted; hence the demand for punctuality in pleading should not be so strict as to prevent inquiry into truth and to deny justice where the delinquency is reasonably excusable. Therefore, while the law makes requirements of punctuality in pleading, it also usually makes provision for relieving against the penalties imposed for a lack of this virtue, when the interests of truth and justice require it. This may be said to be the general policy of the law." Bass v. Doughty, 5 Ga. App. 458, 460 (63 SE 516).
The general rule seems to be that " 'Excusable neglect' does not mean gross negligence. It does not mean a wilful disregard of the process of the court, but refers to cases where there is a reasonable excuse for failing to answer." Brucker v. O'Connor, 115 Ga. 95, 96 (41 SE 245); Haynes v. Smith, 99 Ga. App. 433, 435 (108 SE2d 772) and citations. It has been defined as "that neglect which might have been the act of a reasonably prudent person under the same circumstances." Tradesmans' Nat. Bank &c. Co. v. Cummings, 38 N. J. Super. 1 (118 A2d 80, 82). It "implies not simply any, but reasonable . . . or excusable neglect as to, or . . . occasioned by, some fact, or something that has or has not been done, of which the complaining party ought to have knowledge, and which, if he had had such knowledge, might have prevented" the default. Skinner v. Terry, 107 N. C. 103 (12 SE 118, 119).
This is particularly applicable to a situation in which the neglect results from a reliance upon the action of the opposite party in obtaining what was supposed or thought to be a valid extension of the time within which to file defensive pleadings. Cf. Graves v. Hines, 106 N.C. 323 (11 SE 362, 363); Stafford v. McMillan, 25 Wis. 566, 568; Landau Bros. v. Towery, 51 Ga. App. 113 (3) (179 SE 647).
Applying these principles, was there excusable neglect by the defendant here? Two orders were obtained providing for an extension of time to file defensive pleadings; one for "an additional fifteen days" and another for forty-five days. The first order obviously extended the time for filing the defensive pleadings for fifteen days from the appearance day (September 10), although plaintiff makes a contrary contention. 2 The language of the order determines its effect. The second orders if valid, would have granted forty-five more days, making a total of sixty days extension granted by the court orders and placing the last day for filing defensive pleadings on November 9.
Code 24-2617; Sharman v. Town Council of Thomaston, 67 Ga. 246. Defendant alleges that it did not know it was in default until notified of that fact by the plaintiff's attorney on November 8, 1961, and that the cause of its default is the combined effect of the orders procured by plaintiff. "We think that these facts constitute excusable neglect and it was therefore error to sustain plaintiff's general demurrer to the motion. Certainly the reason is sound in law and appeals to the judicial conscience, requiring a grant of the motion. See Butler & Co. v. Strickland-Tiltman Hdw. Co., 15 Ga. App. 193 (82 SE 815). Let justice be dispensed, not dispensed with!
2. The questions arising on the motion for new trial are not passed on in that a new trial must result because all proceedings after the demurrer was sustained were nugatory.
Judgment reversed. Carlisle, P. J., and Russell, J., concur.
Notes
1  September 10, the thirtieth day after service, falling on Sunday, was nevertheless the appearance day. Merritt v. Gate City Nat. Bank, 100 Ga. 147 (27 SE 979, 38 LRA 749); Heard v. Phillips, 101 Ga. 691 (31 SE 216, 44 LRA 369). However, since there was nothing to be done on the cast day in Merritt and Heard, there may be a valid distinction as to a situation in which the defendant seeks to file his pleadings on the last date and cannot because it is Sunday. See 86 CJS 880, Time, 14 (2); 41 Am. Jur. 514, Pleading, 325; 52 Am. Jur. 344, Time, 19. The first extension granted here would obviate the necessity for any ruling on the question.
2  The basis of this contention is a letter written by plaintiff's counsel to Judge Anderson with a copy to defendant's agent. The body of the letter reads:"I have agreed with the defendant in this case for an additional fifteen days for filing defensive pleadings, to be dated from the time when you sign the order . . ."While defendant had asked for ten additional days, I realize it may take a little more time to negotiate the matter and I feel the fifteen days will serve better." (Emphasis added).While the emphasized portion indicates that the fifteen days is to run from the date the order is signed, the order prepared by plaintiff's counsel and attached to the letter contains no such provision. In addition, the second paragraph of the letter stating that the defendant asked for "ten additional days" supports our conclusion because a grant of ten days from August 31, the date the order was signed, would have given the defendant one day less than the law allowed.
3  Legislation passed since the event related here occurred has modified this rule to provide that the time for filing defensive pleadings may be extended for not more than thirty days by agreement between counsel in writing and filed with the clerk. Code Ann. 81-312 (Ga. L. 1962, p. 687).
4  Counsel for the plaintiff asserts, and we have no doubt of it, that the obtaining of the order from Judge Norman resulted from an inadvertence when he was obtaining his signature to orders in other cases, and that it was entirely unintentional. The attorney's letter of September 13, addressed to defendant,
Randall Evans, Jr., contra.
Isaac S. Jolles, Sanders, Thurmond, Hester & Jolles, for plaintiff in error.
DECIDED DECEMBER 5, 1962.
Friday May 22 22:50 EDT


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