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Dalton Corp. v. Myers

Court of Appeals of Indiana

December 30, 2016

Dalton Corporation, Appellant-Defendant,
v.
Larry Myers and Loa Myers, Appellees-Plaintiffs.

         Appeal from the Marion Superior Court The Honorable Timothy W. Oakes, Judge Trial Court Cause No. 49D02-1405-MI-14372

          ATTORNEY FOR APPELLANT Mark J. Crandley Barnes & Thornburg LLP Indianapolis, Indiana.

          ATTORNEYS FOR APPELLEES Linda George Kathleen A. Farinas Todd Barnes Sarah Broderick George & Farinas, LLP Indianapolis, Indiana.

          Robb, Judge.

         Case Summary and Issue

         [¶1] Dalton Corporation ("Dalton") appeals the trial court's denial of its motion to set aside a default judgment, raising two issues for our review, which we consolidate and restate as whether the trial court abused its discretion in denying Dalton's motion. Concluding the trial court did not abuse its discretion in denying Dalton's motion to set aside default judgment, we affirm.

         Facts and Procedural History

         [¶2] Neenah Enterprises, Inc. ("NEI") is Dalton's parent company. NEI's general counsel monitors and manages legal matters for NEI's subsidiaries, including Dalton.[1] In 2013, Robert Gitter was employed by NEI as the corporate controller, designating him as NEI's contact for receipt of service with Dalton's registered agent in Indiana, Corporation Service Company ("CSC"). Up until 2013, CSC transmitted service to NEI and its subsidiaries by certified mail. In 2013, however, CSC began providing service to NEI and its subsidiaries via email and Gitter did not inform NEI's general counsel of this change. In late 2013, NEI hired John Laskey as its corporate controller and Gitter notified CSC of this change. During this transition, Gitter failed to inform Laskey that CSC only sent notice of service by e-mail and Laskey would be the only individual receiving e-mails from CSC.

         [¶3] On April 30, 2014, Larry Myers and his wife, Loa, filed a complaint against numerous product manufacturers and landowners, including Dalton, alleging negligence. The Myerses served CSC and CSC forwarded notice of the lawsuit to Laskey via e-mail. Laskey did not forward notice of the lawsuit to NEI's general counsel and Dalton did not file an appearance or any responsive pleadings. On September 24, 2014, the Myerses filed a Motion for Default Judgment and served Dalton with the motion via CSC. On October 3, 2014, the trial court granted the motion and entered default judgment against Dalton. Counsel for the Myerses then sent a letter and a copy of the trial court's order to CSC.

         [¶4] Over fourteen months later, NEI received a paper copy of the service list from another defendant's pleading in this cause and realized the Myerses named Dalton as a defendant. After looking into the matter, Dalton filed an appearance and a Motion for Relief from Default Judgment on December 23, 2015. Specifically, Dalton sought equitable relief from the judgment pursuant to Indiana Trial Rule 60(B)(8), claiming a meritorious defense and listing equitable considerations it contends support setting aside the default judgment, including the "confluence of circumstances" leading to default. Appellant's Appendix at 137. Following a hearing on the motion, the trial court issued an order denying Dalton's motion, reasoning Dalton's Rule 60(B)(8) motion sounded in a Rule 60(B)(1) motion and was thus time-barred. Notwithstanding this conclusion, the trial court further concluded the circumstances leading to default-coupled with each party's equitable considerations-did not justify granting Dalton equitable relief under Rule 60(B)(8). This appeal ensued.

         Discussion and Decision

         A. Standard of Review

         [¶5] The decision whether to set aside a default judgment is given substantial deference on appeal. Our standard of review is limited to determining whether the trial court abused its discretion. An abuse of discretion may occur if the trial court's decision is clearly against the logic and effect of the facts and circumstances before the court, or if the court has misinterpreted the law. . . . A cautious approach to the grant of motions for default judgment is warranted in "cases involving material issues of fact, substantial amounts of money, or weighty policy determinations." In addition, the trial court must balance the need for an efficient judicial system with the judicial preference for deciding disputes on the merits. Furthermore, reviewing the decision of the trial court, we will not reweigh the evidence or substitute our judgment for that of the trial court. Upon a motion for relief from a default judgment, the burden is on the movant to show sufficient grounds for relief under Indiana Trial Rule 60(B).

         Huntington Nat. Bank v. Car-X Assoc. Corp., 39 N.E.3d 652, 655 (Ind. 2015) ...


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