DocketNumber: No. 06 MA 160.
Citation Numbers: 2007 Ohio 7208
Judges: VUKOVICH, J.
Filed Date: 12/21/2007
Status: Precedential
Modified Date: 7/6/2016
{¶ 3} On January 8, 2003, appellees filed their answer alleging that appellant did not make full payments under the policy and that appellant failed to negotiate in good faith. Appellees set forth various defenses such as failure to join all parties, *Page 3 ratification, waiver, estoppel and statute of limitations. The answer concluded with a prayer for dismissal of the complaint.
{¶ 4} On April 18, 2003, the trial court dismissed the complaint for "failure to refile within the one year statute of limitations."1 Appellant did not appeal from the April 18, 2003 dismissal entry.
{¶ 5} On August 4, 2006, appellant filed a motion to vacate the court's April 18, 2003 judgment of dismissal. Appellant first claimed entitlement to relief under the catch-all provision in Civ.R. 60(B)(5). Appellant alternatively asked the court to use its inherent power to vacate a void judgment alleging that the court had no authority to enter a sua sponte dismissal without providing appellant notice and an opportunity to be heard.
{¶ 6} Appellees filed a memorandum in opposition. They disclosed that appellant had filed yet a third action on the matter in case number 05CV1830. Appellees also noted that it was not until six months after appellees filed a motion for summary judgment in that third case based upon res judicata of the final order in 02CV3778 that appellant decided to seek vacation of the dismissal order in 02CV3778.2
{¶ 7} On September 15, 2006, the trial court denied appellant's motion to vacate the court's April 18, 2003 dismissal. Appellant filed timely notice of appeal on October 13, 2006. Appellant sets forth two alternative assignments of error on appeal.
{¶ 9} "THE TRIAL COURT ERRED IN DENYING APPELLANT'S MOTION TO VACATE PURSUANT TO CIVIL RULE 60(B)"
{¶ 10} Civ.R. 60(B) provides in pertinent part: *Page 4
{¶ 11} "On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order or proceeding for the following reasons: (1) mistake, inadvertence, surprise or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(B); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation or other misconduct of an adverse party; (4) the judgment has been satisfied, released or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (5) any other reason justifying relief from the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2) and (3) not more than one year after the judgment, order or proceeding was entered or taken."
{¶ 12} There is a three-prong test for determining entitlement to relief under Civ.R. 60(B). The movant must provide operative facts demonstrating: (1) a meritorious claim or defense; (2) entitlement to relief under one of the five grounds listed in the rule; and (3) the timeliness of the motion. GTE Automatic Elec, Inc. v. ARC Indus.,Inc. (1976),
{¶ 13} As to the first prong, appellant's motion for relief stated that its insurance contract carries a fifteen-year statute of limitations. See R.C. 2306.06. Appellant noted that they did not invoke or need the savings statute. See R.C.
{¶ 14} Yet, these arguments are more akin to appellate arguments or at most to GTE's second prong, entitlement to relief, than they are to the meritorious claim prong. *Page 5 That is, meritorious claim refers to whether the plaintiff has a good argument against the defendant in its case in chief. In other words, appellant should have referred to the allegations of the complaint concerning appellees' alleged double recovery and obligation to reimburse rather than or at least in addition to the perceived statute of limitations error.
{¶ 15} Still, some courts allow viewing the complaint to determine if the appellant provided sufficient operative facts regarding a meritorious claim. See Maxim Fin., Inc. v. Dzina (Dec. 2, 1993), 8th Dist. No. 65206 (viewing complaint to determine if merit claim established). See, also, Morgan Adhesives Co. v. Sonicorp Instr.Corp. (1995),
{¶ 16} As to the second prong, appellant claimed entitlement to relief under the catch-all provision in Civ.R. 60(B)(5), "any other reason justifying relief from the judgment." Procedurally, appellant complained that the trial court's sua sponte dismissal was contrary to due process as it was entered without notice or an opportunity to be heard. Substantively, appellant argues that the court's decision was incorrect because of the fifteen-year statute of limitations for written contracts.
{¶ 17} Civ.R. 60(B)(5) reflects the inherent power of the court to relieve the movant from the unjust operation of a judgment.Caruso-Ciresi v. Lohman (1983),
{¶ 18} Pertinent to this prong, it should be pointed out here that it has been established that Civ.R. 60(B) is not a substitute for a direct appeal of the judgment. Key v. Mitchell (1998),
{¶ 19} We acknowledge that the Supreme Court has once cited a secondary source for the proposition that trial court errors are the proper topic for a Civ.R. 60(B)(5) motion. State ex rel. Gyurcsik v.Angelotta (1977),
{¶ 20} The Staff Note provides fraud upon the court by a third-party's jury bribery as an example of the proper use of Civ.R. 60(B)(5). Another example could be perjury by a non-party. These examples fit perfectly under the holdings that appealable mistakes are not substantial reasons for relief under Civ.R. 60(B)(5). That is, one cannot appeal an off-the-record allegation that a juror was bribed by a non-party. Here, however, the issue is essentially the substantive and procedural propriety of the trial court's decision resulting in an appealable dismissal order. Hence, appeal rather than relief from judgment was arguably the proper avenue pursuant to the Supreme Court's Key andBragg decisions and this court's Hankinson and Hamilton decisions. This also ties into the third prong as the ability to appeal has been correlated to the reasonableness of the motion's timing under the third prong of the GTE test.
{¶ 21} Although there is not a one-year time limit for motions filed under the catch-all provision of the rule, such motion must still be filed within a reasonable time. Civ.R. 60(B)(5). Appellant concedes that a decision on the reasonableness of the motion's timing is within the trial court's sound discretion. Appellant also cites to a case that warns that there should be substantial and compelling reasons for opening a judgment after a long period of time such as four years.In re Marriage of Watson (1983),
{¶ 22} Appellant's motion urged that the timing was reasonable given the "unusual circumstance" that appellant filed a third action based upon the belief that that April 18, 2003 order did not bar future actions. However, appellant's mistaken belief that it could ignore a final order and file yet another complaint two years after appellant's second complaint was dismissed with prejudice is not a circumstance which would automatically make a three and one-third year delay in filing the vacation motion reasonable.
{¶ 23} The effect of the April 18, 2003 order was clear, and the existence of the trial court's alleged errors was apparent from the day the order was filed. Regardless of whether it was procedurally proper or substantively correct, the trial court's entry clearly dismissed appellant's complaint due to a statute of limitations issue concerning refiling. A dismissal is on the merits unless specified otherwise. See Civ.R. 41(B)(3). If appellant believed this decision was incorrect or procedurally flawed, appellant should have appealed from it in a timely manner (or at least filed a more timely vacation motion). Instead, appellant waited for over two years and then filed another complaint (number three) on the same claim. Once again, the belief that one can get around a court's allegedly mistaken and improperly entered order by refiling the action later does not automatically provide a substantial and compelling reason or extraordinary circumstance.
{¶ 24} We also note that appellees' motion for summary judgment in the third suit outlined the arguments concerning the finality and res judicata effect of the April 18, 2003 judgment. Even assuming for the sake of argument that this could be considered a proper and reasonable trigger for appellant's realization that they are bound by a prior order, they still waited another six months to file the vacation motion. Considering the amount of time that had already passed, this need not be considered reasonable by the trial court here. *Page 8
{¶ 25} We conclude that under the circumstances of this case, it was not unreasonable or unconscionable for the trial court to have found that the August 4, 2006 motion was not filed within a reasonable time of the April 18, 2003 judgment as there are no extraordinary circumstances accounting for this long delay. As such, the trial court did not abuse its discretion in finding that appellant failed to set forth sufficient operative facts demonstrating all three GTE prongs. Since the trial court properly denied the Civ.R. 60(B)(5) motion to vacate, this assignment of error is overruled.
{¶ 27} "THE TRIAL COURT ERRED IN DENYING APPELLANT'S MOTION TO VACATE ITS JUDGMENT THAT IS VOID AB INITIO."
{¶ 28} Alternatively, appellant contends that the dismissal entry sought to be vacated was void rather than merely voidable. Since courts have inherent power to vacate a void judgment, appellant attempts to characterize the order as void in order to avoid the requirements of Civ.R. 60(B) such as timeliness. Appellant cites appellate cases in support of the argument that a judgment is void not only for lack of subject matter jurisdiction and personal jurisdiction but is also void if it the court acted in a manner contrary to due process. Appellant points out that Civ.R. 41(B)(1) provides for notice to the plaintiff before sua sponte dismissing a complaint for failure to prosecute or failure to comply with the rules or any court order. Appellant then concludes that the court's sua sponte dismissal of the complaint without notice or opportunity to be heard was contrary to due process and thus void ab initio, requiring vacation without regard to the confines of Civ.R. 60(B). We thus turn to the law on distinguishing void from voidable orders.
{¶ 29} As appellant points out, Ohio courts possess inherent power to vacate a void judgment. Patton v. Diemer (1988),
{¶ 30} "It is said that, although in a sense every order which lacks jurisdictional support is erroneous, those which are erroneous for such lack of jurisdiction are void and subject to collateral attack, whereas those which are erroneous for other than jurisdictional reasons are merely voidable and not subject to collateral attack. It is the distinction between those orders which are fatally erroneous because of jurisdictional factors and those which are erroneous for other reasons which presents the difficult question." State ex rel. Beil v. Dota
(1958),
{¶ 31} The drafters of Civ.R. 60(B) have likewise explained in a Staff Note:
{¶ 32} "It is obvious that if a court did not have jurisdiction that a judgment rendered when jurisdiction was not present is void. * * * "[A] void judgment is, for example, a judgment based on a proceeding in which the court lacked jurisdiction over the person of the defendant or jurisdiction over the subject matter of the action. One takes nothing under a void judgment." 1970 Staff Note citing Lincoln Tavern, Inc. v.Snader (1956),
{¶ 33} "It is axiomatic that for a court to acquire jurisdiction there must be a proper service of summons or an entry of appearance, and a judgment rendered without proper service or entry of appearance is a nullity and void. Thus, an attack on a judgment on the ground that there was no service of process constitutes a direct attack on such judgment, rendering unnecessary the answer required under the statutes relating to the vacation of a judgment which is merely voidable." Lincoln,
{¶ 34} From this case law, appellees urge that a void judgment is only one entered without subject matter or personal jurisdiction. As aforementioned, appellant relies on appellate cases, which seemingly add a third category to the definition of a void judgment. Specifically, appellant proposes that a judgment which violates due *Page 10 process is void as well. We shall review the case law which appellant proposes we should adopt.
{¶ 35} In one case, the trial court entered a default judgment against a defendant who had answered and then denied Civ.R. 60(B) relief from the default judgment. Skinner v. Leyland,
{¶ 36} Just as the Skinner case did, appellant also cites theFrangopolous case from the Seventh District. However, that case does not at all imply what appellant and the Skinner case attribute to it. InFrangopolous, we reversed and remanded due to the trial court's failure to hold an ex parte trial where a party who previously pled failed to later appear. Appellant incorrectly assumes that because we did not analyze the issue under Civ.R. 60(B), we must have been vacating a void judgment due to a due process violation. However, our decision was made in a direct appeal of the trial court's default judgment entry. We specifically stated that we were not addressing the appeal from the motion to vacate as it was moot due to our decision in the direct appeal. Thus, both appellant and the Skinner case he cites misread ourFrangopolous case.
{¶ 37} In the Plant case also relied upon in Skinner, the defendant failed to plead but did otherwise appear. The First District Court of Appeals held that the trial court's failure to provide the seven-day notice required by Civ.R. 55(A) rendered the default judgment contrary to due process and void. Plant,
{¶ 38} In AMCA, the Supreme Court was reviewing a timely direct appeal of a default entry which had been entered without the seven-day notice to the defendant who had appeared in the action as required by Civ.R. 55. AMCA,
{¶ 39} Although the Court did note that federal holding, the Supreme Court in AMCA was faced with a timely direct appeal of a default entry. They were not deciding the appeal of a motion to vacate. See id. at 89-90 (revealing that the trial court did not rule on motion to vacate and that the appeal was based upon actual judgment granting default). Thus, the statement is not law or a direct adoption of the law cited. In fact, it may not even be considered dicta as it is a mere notation of various federal holdings.
{¶ 40} As aforementioned, a void judgment is defined as one entered without jurisdiction. State ex rel. Beil v. Dota (1958),
{¶ 41} Rather, it seems to us that typical due process violations, other than a lack of personal jurisdiction, are voidable but not void. Otherwise, all entries which could be described as being entered on issues or motions prior to notice and opportunity to be heard would be subject to attack indefinitely without the Civ.R. 60(B)(5) limitation of vacation being sought within a reasonable time. In contravention of the cases cited by appellant, the Staff Note to Civ.R. 55 speaks of a default judgment being void only if personal service (which provides personal jurisdiction) was never obtained over the defendant; it does not mention due process issues as voiding the judgment. Additionally, there are cases opposing the view of Plant and Skinner and that instead hold that default judgment is merely voidable and not void due to a lack of notice before judgment. See, e.g., National City Mtge. Co. v. Johnson Assoc. Fin. Serv., 2d Dist. No. 21164, 2006-Ohio-2364, ¶ 16 (2d Dist.); Miamisburg Motel v. Huntington Natl. Bank (1993),
{¶ 42} Nevertheless, even if appellate holdings such as Skinner,Shear and Plant properly provide an extension of the traditional rule that a void judgment is one lacking subject matter or personal jurisdiction, those cases are distinguishable as they were based upon faulty default judgments whereas this case does not involve default. Default judgment cases often rely on items outside the record to support the vacation arguments, making them less amenable to appeal. Default judgments are governed by the defining and notice provisions of Civ.R. 55(A). Due to the provision of a specific time for notice before the court can act on a default, one could construe the lack of notice as a lack of jurisdiction to act. These features distinguish the default line of cases from the case at bar.
{¶ 43} Furthermore, appellant's due process argument relies on the notice required by Civ.R. 41(B)(1). However, contrary to appellant's argument, the dismissal here was not covered by the notice provision of Civ.R. 41(B)(1). The rationale for the trial court's dismissal was for failure to comply with the statute of limitations and suggested a savings statute violation as well. Such reasons are not covered by the rule's notice provision. Civ.R. 41(B)(1) ("Where the plaintiff fails to prosecute, or comply with these rules or any court order, the court upon motion of a defendant or on *Page 13 its own motion may, after notice to the plaintiff's counsel, dismiss an action or claim."). Thus, the basis for and strength of appellant's due process argument is further diminished.3
{¶ 44} We also note that sua sponte dismissals other than those mentioned in Civ.R. 41(B)(1) are permissible. See State ex rel. Edwardsv. Toledo City Sch. Dist. Bd. of Edn. (1995),
{¶ 45} This generality of the holding and the adoption of exceptions means that a sua sponte dismissal without prior notice is not void as a due process violation. In other words, the Edwards case tends toestablish that sua sponte dismissals of complaints without notice thatdo not fall under one of the court-created exceptions are voidablerather than void. See id. See, also, State ex rel. Peeples v.Anderson (1995),
{¶ 46} As appellees reason, under the trial court's assessment (correct or not), appellant could not prevail on the face of its complaint, and thus, it was within the court's jurisdiction to dismiss upon such determination. Where the trial court had subject matter and personal jurisdiction, such a dismissal entry is not eternally subject to vacation by the injured party and outside the realm of the appellate rules and Civ.R. 60(B). *Page 14
{¶ 47} In conclusion, even if the trial court violated Civ.R. 41(B)(1) or even if the dismissal did not fall under an Edwards exception to notice, appellant's remedy was an appeal of the judgment (or possibly atimely motion for relief), but such dismissal was not void for mere lack of notice prior to dismissal. See Van DeRyt v. Van DeRyt (1966),
{¶ 48} For the foregoing reasons, the judgment of the trial court is hereby affirmed.
Donofrio, J., concurs. Waite, J., concurs.