Where a default judgment was allegedly entered against a party who was not liable for the debt, is the judgment void? Can a party obtain relief from that judgment under Rule 60(b)(4)?
The facts of this case are a bit unusual. Respondent issued an insurance policy providing coverage for workers compensation. The policy was issued to Quality Supplier Trucking, Inc. (“QST”), a company in which Petitioner is a principal. Petitioner’s exact role in the business of QST is not fully addressed in the briefs. Nevertheless, when premiums for the workers compensation policy fell in arrears, Respondent sued Petitioner directly, not QST.
Petitioner appeared pro se and aggressively defended the case. Eventually, Respondent amended its complaint to allege that additional premiums were due and owing. Petitioner did not answer the amended complaint and effectively ceased participating in the litigation. In January, 2016, Respondent requested and obtained a default judgment.
More than a year later, Petitioner retained an attorney who filed a motion seeking relief from the default judgment under Rule 60(b). The trial court entered a short order finding that the motion asserted mistake or excusable neglect under Rule 60(b)(1) and/or fraud under Rule 60(b)(3). In either event, the language of Rule 60(b) required the motion to be filed within one year. Because Petitioner’s motion was filed more than one year after entry of the default judgment, it was untimely. Petitioner timely appealed.
Petitioner argues that his motion is properly analyzed under Rule 60(b)(4) because the underlying judgment is “void.” Because the one year limitation does not apply to void judgments, Petitioner argues that the trial court should have granted the relief he was requesting. Specifically, Petitioner argues that he was “not the entity under contract” and thus, “did not incur the debt alleged.” For this reason, “personal jurisdiction was not secured against [Petitioner] as a result of improper service of process.” Petitioner argues separately that certain statements made by the trial court indicate a prejudice also warranting relief.
According to Respondent, this appeal has nothing to do with jurisdiction or void judgments. The question is not whether the court had jurisdiction over QST. Clearly, it did not. Instead, the question is whether the court had jurisdiction over Petitioner--i.e., the party against whom the default judgment was entered. Respondent named Petitioner as a party, properly served Petitioner with process, and obtained a default judgment in compliance with the rules of civil procedure after Petitioner failed to answer the amended complaint. Thus, the court had personal jurisdiction over Petitioner. Even if, as Petitioner argues, the judgment was somehow “wrong” because it was against the wrong party, this still “would not transform it into a void judgment.” At most, then, Petitioner’s motion is based on mistake or excusable neglect, which is barred by the one year time period under Rule 60(b).
The Supreme Court has placed this argument on its Rule 20 docket. Therefore, it is likely that the Court will write a new syllabus point addressing one or more of these issues. The law certainly favors Respondent’s position. West Virginia’s bench and bar will both benefit from an opinion addressing Rule 60(b), especially in a case involving a default judgment. I predict a win for Respondent. However, we will have to wait to see how broadly the Court writes its new syllabus points.