Progressive Direct Ins. Co. v. Williams , 2022 Ohio 887 ( 2022 )

[Cite as Progressive Direct Ins. Co. v. Williams, 2022-Ohio-887.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
MARION COUNTY
PROGRESSIVE DIRECT
INSURANCE CO., ET AL.,
PLAINTIFFS-APPELLEES, CASE NO. 9-21-26
v.
PAUL WILLIAMS, OPINION
DEFENDANT-APPELLANT.
Appeal from Marion County Common Pleas Court
Trial Court No. 20 CV 264
Judgment Reversed and Cause Remanded
Date of Decision: March 21, 2022
APPEARANCES:
Jacqueline Gutter for Appellant
Nadia N. Traxler for Appellee
Case No. 9-21-26
ZIMMERMAN, P.J.
{¶1} Defendant-appellant, Paul M. Williams (“Williams”), appeals the July
14, 2021 judgment of the Marion County Court of Common Pleas denying
Williams’s motion to vacate the default judgment in favor of plaintiffs-appellees,
Progressive Direct Insurance Company (“Progressive”) and William L. Lindsay
(“Lindsay”) (collectively, “plaintiffs”). For the reasons that follow, we reverse.
{¶2} This case arises from a multi-vehicle accident, which occurred on April
18, 2018 in Marion County, Ohio. As relevant to this case, there is no dispute that
the vehicle operated by Williams collided with the vehicle, which was owned by
Lindsay, and was being operated Olivia Lindsay, who is not party to this case. On
July 22, 2020, the plaintiffs filed a complaint alleging a claim for negligence against
Williams and requesting $109,585.74 in damages. (Doc. No. 1). Because Williams
did not file an answer to the complaint, the plaintiffs filed a motion for default
judgment on December 11, 2020. (Doc. No. 3). The trial court granted the
plaintiff’s motion for default judgment on December 14, 2020. (Doc. No. 4).
{¶3} On July 12, 2021, Williams field a motion requesting that the trial court
vacate the default judgment for the reason that the trial court was without personal
jurisdiction to enter judgment against him. (Doc. Nos. 14, 15). Importantly,
Williams requested a hearing on his motion to vacate the default judgment. (Doc.
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No. 15). On July 14, 2021, the trial court denied Williams’s motion to vacate the
default judgment without a hearing. (Doc. No. 16).
{¶4} Williams filed his notice of appeal on August 13, 2021. (Doc. No. 17).
He raises three assignments on appeal, which we will discuss together.
Assignment of Error No. I
The trial court erred as a matter law [sic] by exercising personal
jurisdiction over Mr. Williams when Progressive failed to comply
with the Civil Rules.
Assignment of Error No. II
The trial court should have granted the motion to vacate when
Mr. William’s [sic] filed an unopposed motion and affidavit
stating he was not served and the docket showed the Clerk issued
a notice of failure of service.
Assignment of Error No. III
The trial court erred in denying Mr. Williams’ Motion to Vacate
without a hearing.
{¶5} In his assignments of error, Williams argues that the trial court abused
its discretion by denying his motion to vacate the trial court’s default judgment
without a hearing. In particular, Williams contends that “a certified mail receipt
marked ‘C-19’ and lacking [a] defendant’s signature or initials [does not]
constitute[] valid service of process.” (Appellant’s Brief at 1).
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Case No. 9-21-26
Standard of Review
{¶6} Generally, “[a] trial court’s decision regarding a motion to vacate a
judgment will not be overturned on appeal absent an abuse of discretion.” TCC
Mgt., Inc. v. Clapp, 10th Dist. Franklin No. 05AP-42, 2005-Ohio-4357, ¶ 9, citing
C & W Inv. Co. v. Midwest Vending, Inc., 10th Dist. Franklin No. 03AP-40, 2003-
Ohio-4688, ¶ 7. An abuse of discretion constitutes more than an error of judgment;
rather, it implies that the trial court acted unreasonably, arbitrarily, or
unconscionably. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219 (1983).
Analysis
{¶7} “‘“It is rudimentary that in order to render a valid personal judgment, a
court must have personal jurisdiction over the defendant.”’” Britton v. Britton, 4th
Dist. Washington No. 18CA10, 2019-Ohio-2179, ¶ 12, quoting State ex rel. Doe v.
Capper, 132 Ohio St.3d 365, 2012-Ohio-2686, ¶ 13, quoting Maryhew v. Yova, 11
Ohio St.3d 154, 156 (1984). “‘“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.”’” Id., quoting State ex rel. Ballard v. O’Donnell, 50 Ohio St.3d 182, 183
(1990), quoting Lincoln Tavern, Inc. v. Snader, 165 Ohio St. 61, 64 (1956).
{¶8} “‘An appellate court reviews a trial court’s determination of whether
personal jurisdiction over a party exists under a de novo standard of review.’” Id.-4-
Case No. 9-21-26
at ¶ 13, quoting State ex rel. Athens Cty. Dept. of Job & Family Servs. v. Martin,
4th Dist. Athens No. 07CA11, 2008-Ohio-1849, ¶ 13. “However, ‘[a] reviewing
court will not disturb a trial court’s finding regarding whether service was proper
unless the trial court abused its discretion.’” Id., quoting Beaver v. Beaver, 4th Dist.
Pickaway No. 18CA5, 2018-Ohio-4460, ¶ 8. Again, for this court to conclude that
the trial court abused its discretion, we must find that it acted unreasonably,
arbitrarily, or unconscionably. Blakemore, 5 Ohio St.3d at 219.
{¶9} Here, we conclude that the trial court abused its discretion by denying
Williams’s motion to vacate the default judgment without a hearing. That is, based
on the specific facts and circumstances of this case, we conclude that the trial court’s
conclusion (without a hearing) that service was proper in this case was
unreasonable, arbitrary, and unconscionable.
{¶10} “‘The plaintiff bears the burden of obtaining proper service on a
defendant.’” Britton at ¶ 14, quoting Beaver at ¶ 9. A rebuttable presumption “‘of
proper service arises when the record reflects that a party has followed the Civil
Rules pertaining to service of process.’” Bader v. Ferri, 3d Dist. Allen No. 1-13-
01, 2013-Ohio-3074, ¶ 20, quoting Poorman v. Ohio Adult Parole Auth., 4th Dist.
Pickaway No. 01CA16, 2002 WL 398721, *2, citing Potter v. Troy, 78 Ohio App.3d
372, 377 (2d Dist.1992).
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{¶11} “To rebut the presumption of proper service, ‘“the other party must
produce evidentiary-quality information demonstrating that he or she did not receive
service.”’” Britton at ¶ 15, quoting Hendrickson at ¶ 32, quoting McWilliams v.
Schumacher, 8th Dist. Cuyahoga Nos. 98188, 98288, 98390 and 98423, 2013-Ohio-
29, ¶ 51. “In determining whether a defendant has sufficiently rebutted the
presumption of valid service, the trial court may assess the credibility and
competency of the submitted evidence of non-service.” TCC Mgt., Inc., 2005-Ohio-
4357, at ¶ 15. Generally, “‘[a] trial court is not required to give preclusive effect to
a movant’s sworn statement that [the movant] did not receive service of process
when the record contains no other indication that service was ineffectual.’” Britton
at ¶ 15, quoting TCC Mgt., Inc. at ¶ 15. However, there can be circumstances under
which “such a sworn statement at least warrants the trial court conducting a hearing
to determine the validity of the movant’s statement.” TCC Mgt., Inc. at ¶ 15, citing
Wilson’s Auto Serv., Inc. v. O’Brien, 10th Dist. Franklin No. 92AP-1406, 1993 WL
54667, *1 (Mar. 4, 1993). See also id. (suggesting that “a trial court errs in
summarily overruling a defendant’s motion to set aside a judgment for lack of
service, when the defendant submits a sworn statement that she did not receive
service of process, without affording the defendant a hearing”), citing Wilson’s Auto
Serv., Inc. at *1 and Baumann v. Purchase Plus Buyer’s Group, Inc., 10th Dist.
Franklin No. 01AP-297, 2001 WL 1511991, *3 (Nov. 29, 2001). But see New Co-
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Operative Co. v. Liquor Control Comm., 10th Dist. Franklin No. 01AP-1124, 2002-
Ohio-2244, ¶ 9 (noting that “[a]n affidavit, by itself, stating that appellant did not
receive service, may not be sufficient to rebut the presumption without any other
evidence of a failure of service”).
{¶12} “Civ.R. 4.1 outlines the methods for obtaining service of process
within this state, including service via certified mail.” TCC Mgt., Inc. at ¶ 11. Under
“Civ.R. 4.1(A), service of process via certified mail is evidenced by a return receipt
signed by any person.” Id. See also Civ.R. 4.6. “Civ.R. 4.1(A) does not require
that delivery is restricted to the defendant or to a person authorized to receive service
of process on the defendant’s behalf.” TCC Mgt., Inc. at ¶ 11. See also CUC
Properties VI, LLC v. Smartlink Ventures, Inc., 1st Dist. Hamilton No. C-210003,
2021-Ohio-3428, ¶ 9 (“The “any person” language in Civ.R. 4.1 is not limited to the
defendant or its agents, but is a flexible concept construed broadly.”). “When
service is attempted by certified mail, a signed receipt returned to the sender
establishes a prima facie case of delivery to the addressee.” TCC Mgt., Inc. at ¶ 11,
citing New Co-Operative Co. at ¶ 8. “Valid service of process is presumed when
any person at the defendant’s address received the certified mail envelope, whether
or not the recipient is the defendant’s agent.” Id., citing New Co-Operative Co. at ¶
8.
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{¶13} In response to the Covid-19 pandemic, the United States Postal
Service (“USPS”) “modified mail procedures for services that normally required
carriers to venture in close proximity to customers.” CUC Properties at ¶ 3, citing
United States Postal Service, Covid-19 Continuity of Operations Update,
https://about.usps.com/newsroom/service-alerts/pdf/usps-continuity-of-operations-
03-20-2020.pdf (accessed Sept. 16, 2021). “In lieu of face-to-face signatures, USPS
instructed its carriers to maintain a safe distance, ask the recipient for their first
initial and last name, enter that information on the return receipt, and then have the
customer step back while the employee placed the mail in an appropriate place.” Id.See also Finnell v. Eppens, S.D.Ohio No. 1:20-CV-337, 2021 WL 2280656, *2
(June 4, 2021) (noting that the USPS “adopted a signature policy for certified mail
in response to the COVID-19 pandemic,” which “instructed its delivery personnel
to ensure that someone was at the address to receive the letter, to ask that person for
their name, and to then leave the letter where the person could get it”).
{¶14} Shortly thereafter, the Supreme Court of Ohio instituted an
administrative action, which authorized Ohio’s courts of common pleas the power
to waive any rule requiring in-person service of process. See CUC Properties at ¶
13. Importantly, that administrative action authorized that “[a]ny requirement in a
rule of the Court that a party appear in person or requiring in-person service may be
waived by the Court, local court, hearing panel, board, or commission, as
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applicable.” See In re Tolling of Time Requirements Imposed by Rules Promulgated
by the Supreme Court & Use of Technology, 158 Ohio St.3d 1447, 1448, 2020-
Ohio-1166.
{¶15} Here, the record reflects that the plaintiffs attempted service via
certified mail on July 24, 2020, and that return of service was received in the trial
court on July 31, 2020 (as evidenced by a certified-mail receipt signed “C19”).
(Doc. Nos 1, 2). Notwithstanding the certified-mail receipt, the trial court’s clerk
of courts notified the plaintiffs on August 3, 2020 that service was “unsuccessful”
because the certified-mail receipt was signed “C19.” (Doc. No. 2). Thereafter, the
trial court issued an order on August 28, 2020 in accordance with the USPS
certified-mail policy and the Supreme Court’s administrative action authorizing it
to waive in-person service of process. (Doc. No. 16). See, e.g., CUC Properties at
¶ 13 (recognizing Ohio courts of common pleas that adopted “a variety of rules to
accommodate alternative certified mail signatures”); Finnell at *5 (acknowledging
a similar order issued by the federal court). Specifically, the trial court concluded
that “by marking COVID 19 comports with Rule 4.1(A)(1)(a) and due process” and
ordered that the “practice by the [USPS] will be treated as good service by” the trial
court. (Doc. No. 16). However, the trial court did not state whether its order should
be applied retroactively. Accord Finnell at *5 (noting that “while that order was
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‘effective immediately,’ the Court did not even purport to order retroactive
application”).
{¶16} In this case, Williams asserted in his motion to vacate that he was
never served with the complaint. In support of that assertion, Williams included an
affidavit in which he averred that that he did not receive the complaint and that no
one in his “household received or signed for the complaint * * * .” (Doc. No. 15).
Before providing the plaintiffs an opportunity to respond, the trial court denied
Williams’s motion to vacate without a hearing.
{¶17} On appeal, Williams argues that the trial court abused its discretion by
denying his motion to vacate without a hearing and by concluding that service was
proper in this case because, in part, the clerk of courts determined that service of
process was unsuccessful. A legal determination as to the validity of a signature on
a certified-mail receipt by a clerk of courts does not determine whether a court has
personal jurisdiction over a party. Furthermore, the case to which Williams directs
this court to suggest that it does is misplaced. See Maryhew v. Yova, 11 Ohio St.3d
154, 156 (1984) (noting in the statement of facts that the clerk of courts notified a
party that service “was returned by the postal authorities marked ‘unknown’”).
{¶18} Instead, based on the specific facts and circumstances of this case, the
“flexible” concept of the “any person” language of Civ.R. 4.1 coupled with
Williams’s sworn statement at least warrants a hearing for the trial court to
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determine whether it had personal jurisdiction over Williams. See TCC Mgt., Inc.,
2005-Ohio-4357, at ¶ 15. In other words, Williams’s sworn statement along with
the certified-mail receipt marked “C19” is sufficient evidence to merit a hearing
during which the trial court can more fully explore whether the plaintiffs met their
burden of showing whether proper service occurred in this case and, if so, whether
Williams can rebut the presumption that he was properly served. Furthermore,
while this court is cognizant of the unusual circumstances presented by the
pandemic and empathizes with the courts attempting to manage these extraordinary
conditions, we also recognize the importance of developing a full and complete
record to best serve the interests of justice.
{¶19} Consequently, we conclude that the trial court’s conclusion that
service was proper in this case was unreasonable, arbitrary, and unconscionable.
Thus, the trial court abused its discretion by denying Williams’s motion to vacate
the default judgment without a hearing.
{¶20} Having found error prejudicial to the appellant herein in the particulars
assigned and argued, we reverse the judgment of the trial court and remand for
further proceedings.
Judgment Reversed and
Cause Remanded
SHAW and WILLAMOWSKI, J.J., concur.
/jlr
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