Justus v. Justus ( 1983 )

Weinstein, J.,

dissents and votes to affirm the order, with the following memorandum: In my view the default involved in the present case is not fairly characterized as one resulting from “law office failure”. The Hertz’ licensee or franchisee did not become aware that it owed Hertz a defense in the instant action until after the default judgment had been entered, should not preclude Hertz from the opportunity to assert its defenses and to attempt to make a showing of legal merit. After the action had been commenced against Hertz by service upon the Secretary of State and the filing of an affidavit of service and a copy of the summons and complaint in the Dutchess County Clerk’s office, plaintiff’s counsel spoke with Charles Maulick, a representative of Hertz, and requested that the latter obtain a copy of the rental agreement executed by defendant Franklyn Justus. Maulick advised counsel that he had written to the Aruba office to ascertain whether or not a copy of the agreement could be obtained. As averred by the Home Office Casualty Manager of the Hertz Corporation, the complaint was sent, upon its receipt by Hertz, to De Palm Tours, N. V., the owner of the vehicle involved in the action. Hertz was therefore under the impression that in view of the licensing agreement between itself and De Palm, the latter would defend and hold Hertz harmless for any liability arising out of the licensing agreement. On June 2, 1981 plaintiff’s counsel again spoke with Hertz’ representative, Charles Maulick, and advised him that Hertz was in default in answering. Maulick advised counsel that he would take care of the matter. Plaintiff’s application for a default judgment and an assessment of damages was made by notice of motion dated August 31, 1981. The motion was granted by order dated September 28, 1981. The default of Hertz in answering the complaint was unintentional and is attributable to a misunderstanding between itself and De Palm, which misunderstanding was caused by the difficulty of communication between Aruba and New York. Up until October 6,1981, after the entry of the default, Hertz was under the impression that its interests were being protected by its licensee. The majority considers it unreasonable for Hertz to have relied upon De PalrrTto assume its defense after having been informed by plaintiff’s counsel on June 2,1981 that an answer had not yet been served on its behalf. I am of the opinion, however, that inasmuch as Hertz had promptly caused the complaint to be forwarded to its licensee as the party responsible for its defense, this case does not involve a “saga of indifference” on the part of Hertz, nor does it fall within the ambit of the “law office failure” principle (Swidler v World-Wide Volkswagen Corp., 85 AD2d 239, 241). While the record does not specifically document what, if anything, Hertz did to “take care” of the situation after having been informed that it was in default, the fact nevertheless remains that it promptly forwarded the complaint to De Palm. By virtue of the franchise agreement, De Palm’s role was akin to that of an agent entrusted with the defense of its principal. Viewed in this perspective, it was entirely reasonable for Hertz to rely upon De Palm to provide counsel. That De Palm, which was neither a carrier nor an attorney who could file a notice of appearance or an answer, failed to timely recognize or acknowledge its obligation to obtain counsel to defend Hertz, is not the typical example of law office failure. Such failure should not, in my opinion, preclude Hertz from asserting a defense in the action. To relieve Hertz’ default under these circumstances would be consistent with public policy as I view it. “The law is not a set of rigid rules totally divorced from all sense of fair play. Nor is the law incapable of forgiving or excusing any and all human error, particularly when that error is clearly unintentional on the part of the one seeking relief from the court and is plainly nonprejudicial to the adversary. Indeed, the policy of the law clearly favors the disposition of actions on the merits” (Swidler v WorldWide Volkswagen Corp., supra, p 242). Within less than a month after the default judgment was entered, Hertz promptly moved to vacate the default. Aside from mere delay, plaintiff has not shown any legal prejudice occasioned by her having to prove her case on the merits. Moreover, Hertz has demonstrated the existence of meritorious defenses such as forum non conveniens, the fact that it did not own the automobile involved in plaintiff’s accident or exercise any control over it, and the fact that defendant Franklyn Justus permitted the vehicle to be operated by an unlicensed driver under the age of 21 in contravention of the rental contract. Accordingly, I vote to affirm the order granting the motion to vacate the default judgment entered against defendant Hertz.