Liberty Nat. Bank & Trust Co. v. Kummert , 305 Ky. 769 ( 1947 )

Affirming.

On October 29, 1938, the Liberty National Bank Trust Company recovered a judgment against appellee L.W. Kummert in the sum of $1,067.39, with interest, on a note executed by him and J.P. Conn. On March 3, 1939, an execution was issued which was returned "no property round." On March 16, 1946, the bank instituted this action under section 439 of the Civil Code of Practice to discover any property owned by Kummert, and subject same to the payment of the judgment.

Kummert filed an answer pleading that he was surety on the note for Conn and that more than seven years had elapsed "without the issue of execution or prosecution in good faith for collection of said claim," and that the judgment was barred by the limitation provided by KRS 413.220.

During the pendency of the action negotiations were entered into for the purpose of effecting a compromise of the claim, but no settlement was ever reached. The case was set at rules on May 6th but remanded on May 10th. It was again set at rules on May 13th and again remanded on May 17th. It was set at rules for the third time on May 20th, and on May 24th, when the case was called, Kummert's counsel moved for judgment on the pleadings. This motion was sustained, and on June 6th judgment was entered discharging an attachment. On June 11th this judgment was amended adjudging that Kummert was only a surety on the note and that the judgment against him was barred by the statute of limitations.

On June 13th the bank's attorney served notice on Kummert's attorney that on June 18th he would move to set aside the default judgment and tender his reply. On June 18th the chancellor overruled this motion. No appeal has been prosecuted from the judgment of June 18th, this appeal being from the judgment entered on June 6, 1946, as amended on. June 11, 1946. No claim is made that the court committed an error in entering the judgments of June 6 and June 11, 1946. The issue as presented here is whether or not the court abused its discretion in refusing to set aside the default judgment. We might well affirm the judgment on this ground alone (James v. Carter, 274 Ky. 273, 118 S.W.2d 558), but we have concluded to consider the case on its merits.

Affidavits were filed in support of, and in opposition to, the motion to set aside the judgment. The affidavit of the bank's attorney is to the effect that he understood the case would not be submitted for judgment until attorneys for both parties had examined the bank records pertaining to the original note. The counter affidavit is to the effect that there was no agreement regarding the submission of the case, and the conduct of the bank's attorney indicated that negotiations concerning a settlement had been terminated.

It is a well settled rule that when a motion is made in due time to set aside a default judgment the court is not hampered by rules of procedure regulating the granting of new trials, but has an inherent right to vacate the judgment, and should be liberal in this respect in order that the litigant in default may not be deprived of his day in court. This power must not be exercised capriciously but as a judicial discretion. Southern Insurance Company v. Johnson, 140 Ky. 485, 131 S.W. 270; Union Gas Oil Co. v. Kelly, 194 Ky. 153, 238 S.W. 384, and Carr Creek Community Center v. Home Lumber Company, 276 Ky. 840,125 S.W.2d 777.

A motion to vacate a judgment is addressed to the sound legal discretion of the trial court on the particular facts of the case, and that court's discretion should not be disturbed on appeal unless it is clear that its discretion has been abused. See Green v. Commonwealth, 152 Ky. 239, 153 S.W. 242, and Zimmerman v. Segal, 288 Ky. 33, 155 S.W.2d 20.

A party is never entitled to have a default judgment set aside as a matter of right, although, as stated above, the courts are prone to adopt a liberal attitude in dealing with default judgments where the proper motion is made within time. It is only where the party in default shows a reasonable excuse and establishes to the satisfaction of the court that he has not been guilty of unreasonable delay or neglect that the discretion of the trial court should be exercised in setting aside a default judgment. See Bond v. W. T. Congleton Company,278 Ky. 829, 129 S.W.2d 570.

The affidavit of the bank's attorney charges no unfair action or conduct on the part of his adversary, but merely states he was under the impression that counsel on each side understood that negotiations were still in progress. This is denied by a counter affidavit, and we do not believe the chancellor abused his discretion in refusing to set aside the default judgment, especially in view of his familiarity with the proceeding, the conduct of counsel for both sides, and the further fact that Kummert's attorney had caused the case to be set at rules on three different occasions before filing his motion for a judgment on the pleadings.

Procedure and practice in the Jefferson Circuit Court is controlled by a complete set of rules. KRS 24.250. Under those rules cases are set by means of a set-slip filed in the clerk's office. Setting a case at rules is notice to the adverse party, Rule 409. Cases set at rules appear on the dockets made up in numerical order according to branches and divisions, and these dockets are published in the Daily Record. It is the universal practice of the members of that bar to check this docket each week. This procedure, under these rules, has been long established and has proven to be fair and workable.

We agree with the trial court that the excuse offered was insufficient, especially in view of the surrounding circumstances, and we do not believe the chancellor abused his discretion in refusing to set aside the judgment.

Wherefore the judgment is affirmed.

Chief Justice Sims and Judge Thomas dissent.