Court Opinion

ID: 3165675
Source: CourtListenerOpinion
Date Created: 2015-12-28 16:03:34.419628+00
Date Added: 2024-06-11T12:17:01.321835
License: Public Domain

MEMORANDUM DECISION
                                                                       Dec 28 2015, 8:48 am
      Pursuant to Ind. Appellate Rule 65(D), this
      Memorandum Decision shall not be regarded as
      precedent or cited before any court except for the
      purpose of establishing the defense of res judicata,
      collateral estoppel, or the law of the case.

      ATTORNEYS FOR APPELLANT                                  ATTORNEYS FOR APPELLEE
      Mario Garcia                                             David J. Jurkiewicz
      Christopher H. Weintraut                                 Nathan T. Danielson
      Brattain Minnix Garcia                                   Bose McKinney & Evans LLP
      Indianapolis, Indiana                                    Indianapolis, Indiana

                                                   IN THE
          COURT OF APPEALS OF INDIANA

      Mikhail Goloverya,                                      December 28, 2015

      Appellant-Defendant,                                    Court of Appeals Case No.
                                                              29A05-1508-CC-1215
              v.                                              Appeal from the Hamilton Superior
                                                              Court

      Nextgear Capital, Inc.,
                                                              The Honorable Steven R. Nation,
      Appellee-Plaintiff.                                     Judge
                                                              Cause No. 29D01-1501-CC-141

      Bradford, Judge.

                                            Case Summary
[1]   In 2013, Appellee-Plaintiff Nextgear Capital, Inc. made a commercial loan

      (“the Loan”) in the amount of $100,000.00 to G Auto Sales, Inc., of which

      Appellant-Defendant Mikhail Goloverya was president. Goloverya had
      Court of Appeals of Indiana | Memorandum Decision 29A05-1508-CC1215 | December 28, 2015   Page 1 of 8
      recently executed an individual guaranty (“the Guaranty”) in favor of Nextgear

      in which he guaranteed payment of G Auto Sales’s liabilities to Nextgear. G

      Auto Sales defaulted on the Loan, and Nextgear filed a complaint seeking to

      enforce the Guaranty against Goloverya. Nextgear caused the trial court clerk

      to serve the complaint on Goloverya at an address on Grasshopper Street in

      Warminster, Pennsylvania (“the Grasshopper Address”), the address

      Goloverya provided in connection with the Loan and listed on the Guaranty.

[2]   The complaint and summons were sent to the Grasshopper Address and signed

      for by Goloverya’s mother. Goloverya received the complaint and summons

      within a week afterwards, and telephoned an attorney for Nextgear and

      informed him that he had received them. Nextgear made no further attempts at

      service, and Goloverya did not respond to the complaint in the trial court. Over

      thirty days later, Nextgear filed its motion for default judgment. The trial court

      entered judgment in favor of Nextgear, and, after Goloverya’s attempt to appeal

      was untimely, he filed a motion to set aside the judgment, which the trial court

      denied. Goloverya appeals, contending that the judgment in favor of Nextgear

      is void for lack of personal jurisdiction due to legally deficient service of the

      complaint and summons. We affirm.

                            Facts and Procedural History
[3]   In August of 2013, Goloverya, who operated G Auto Sales in New Jersey,

      executed the Guaranty in favor of Nextgear guaranteeing certain of G Auto

      Sales’s obligations to Nextgear. The Guaranty listed the Grasshopper address

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      as the address to which notices to Goloverya were to be sent. In September of

      2013, G Auto Sales obtained the Loan, in the amount of $100,000.00, from

      Nextgear, an obligation subject to the Guaranty.

[4]   As of December 31, 2014, G Auto Sales had defaulted on the Loan and owed

      $284,717.02. On January 9, 2015, Nextgear filed suit against Goloverya on the

      Guaranty. Nextgear sent copies of the complaint and summons to the

      Grasshopper address via certified or registered mail. On January 13, 2015, the

      complaint and summons were received at the Grasshopper Address and signed

      for by Goloverya’s mother. On January 20, 2015, an attorney for Nextgear

      received a telephone call from Goloverya, in which he admitted that he had

      received the complaint and summons. Nextgear made no further attempts to

      serve Goloverya with copies of the complaint and summons. Goloverya,

      however, filed no response to the complaint at this point.

[5]   On February 20, 2015, Nextgear moved for default judgment, and the trial

      court entered default judgment in favor of Nextgear on February 27, 2015. On

      March 28, 2015, Goloverya filed a notice of appeal, which this court dismissed

      on April 16, 2015. On June 17, 2015, Goloverya filed a motion to set aside

      judgment pursuant to Indiana Trial Rule 60, which the trial court denied on

      July 27, 2015.

                                Discussion and Decision

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[6]   Goloverya contends that the trial court lacked personal jurisdiction over him

      because he was not properly served. Indiana Trial Rule 4.1 governs service on

      individuals and provides, in part, that

              [s]ervice may be made upon an individual, or an individual
              acting in a representative capacity, by … sending a copy of the
              summons and complaint by registered or certified mail or other
              public means by which a written acknowledgment of receipt may
              be requested and obtained to his residence, place of business or
              employment with return receipt requested and returned showing
              receipt of the letter[.]
[7]   Moreover, as we have explained,

              “Personal jurisdiction is the court’s power to bring a person into
              its adjudicative process and render a valid judgment over a
              person.” Keesling v. Winstead, 858 N.E.2d 996, 1000 (Ind. Ct.
              App. 2006) (citation omitted). Without effective service of
              process, a trial court does not obtain personal jurisdiction over a
              defendant. Goodson v. Carlson, 888 N.E.2d 217, 220 (Ind. Ct.
              App. 2008). “The existence of personal jurisdiction over a
              defendant is … a constitutional requirement to rendering a valid
              judgment, mandated by the Due Process Clause of the
              Fourteenth Amendment to the United States Constitution.”
              Munster v. Groce, 829 N.E.2d 52, 57 (Ind. Ct. App. 2005). Once
              the party contesting jurisdiction, usually the defendant,
              challenges the lack of personal jurisdiction, the plaintiff must
              present evidence of a court’s personal jurisdiction over the
              defendant, but “the defendant ultimately bears the burden of
              proving the lack of personal jurisdiction by a preponderance of
              the evidence, unless that lack is apparent on the face of the
              complaint.” LePore v. Norwest Bank Indiana, N.A., 860 N.E.2d
              632, 634 (Ind. Ct. App. 2007).
      Norris v. Pers. Fin., 957 N.E.2d 1002, 1006-07 (Ind. Ct. App. 2011).

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[8]   In this case, Goloverya’s challenge to personal jurisdiction arises in the context

      of the trial court’s denial of his motion for relief from judgment. Trial Rule

      60(B) provides, in relevant part, as follows: “On motion and upon such terms

      as are just the court may relieve a party or his legal representative from a

      judgment, including a judgment by default, for the following reasons: … the

      judgment is void[.]” A judgment rendered where service of process was

      inadequate is void for want of personal jurisdiction. See Stidham v. Whelchel,

      698 N.E.2d 1152, 1155 (Ind. 1998).

              When a defendant argues a lack of personal jurisdiction, the
              plaintiff must present evidence to show that there is personal
              jurisdiction over the defendant. Anthem Ins. Companies, Inc. v.
              Tenet Healthcare Corp., 730 N.E.2d 1227, 1231 (Ind. 2000). The
              defendant ultimately bears the burden of proving the lack of
              personal jurisdiction by a preponderance of the evidence, unless
              the lack of jurisdiction is apparent on the face of the complaint.
              Id. The existence of personal jurisdiction over a defendant is a
              question of law and a constitutional requirement to rendering a
              valid judgment, mandated by the Due Process Clause of the
              Fourteenth Amendment to the United States Constitution. Id. at
              1237. Thus, we review a trial court’s determination regarding
              personal jurisdiction de novo. Id. at 1238. To the extent a trial
              court may make findings of jurisdictional facts, these findings are
              reviewed for clear error if they were based on in-court testimony.
              Id. at 1238. If, however, only a paper record has been presented
              to the trial court, we are in as good a position as the trial court to
              determine the existence of jurisdictional facts and will employ de
              novo review as to those facts. Id. at n. 12.
      Munster, 829 N.E.2d at 57. Here, we have been provided with a paper record

      and will therefore review relevant jurisdictional facts de novo.

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[9]    Goloverya contends that Nextgear rendered inadequate service of process

       because it sent the complaint and summons to the Grasshopper address, which

       is not his residence. It is undisputed that the Grasshopper address was not

       Goloverya’s residence at the relevant time, so Nextgear’s attempt to serve

       Goloverya did not comply with the requirements of Trial Rule 4.1. Nextgear,

       however, argues that any defect in service was cured. Trial Rule 4.15(F)

       provides that “[n]o summons or the service thereof shall be set aside or be

       adjudged insufficient when either is reasonably calculated to inform the person

       to be served that an action has been instituted against him, the name of the

       court, and the time within which he is required to respond.” The question,

       then, is whether service at the Grasshopper address was reasonably calculated

       to inform Goloverya of the lawsuit. Under the circumstances of the case, we

       conclude that it was.

[10]   Nextgear mailed the complaint and summons to the Grasshopper address,

       which had been specifically provided by Goloverya as the address for notices

       pursuant to the Guaranty approximately eighteen months previously. Despite

       being in a contractual relationship with Nextgear, Goloverya never notified

       Nextgear that he had moved. One week after the complaint and summons

       were received at the Grasshopper address, Goloverya notified Nextgear’s

       counsel that he was in actual possession of the complaint and summons. In our

       view, this last fact is of particular importance. We have explained that

       “although actual notice alone will not cure defective service, it may be

       considered in determining whether the notice was reasonably calculated to

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       inform an organization of the action.” Nw. Nat. Ins. Co. v. Mapps, 717 N.E.2d

       947, 955 (Ind. Ct. App. 1999). See also Matter of Paternity of R.L.W., 643 N.E.2d

       367, 369 (Ind. Ct. App. 1994) (“However, the actual knowledge of the person

       served is relevant and probative to an inquiry into the likely efficacy of the

       service employed.”).

[11]   In so concluding, we conclude that Mills v. Coil, 647 N.E.2d 679 (Ind. Ct. App.

       1995), trans. denied, on which Goloverya relies, is distinguishable. In that case,

       Mills and Coil were involved in a traffic accident, and Mills filed suit

       approximately two years later, serving Coil at Coil’s Fort Wayne address. Id. at

       679-80. Coil, however, had moved to Ohio three months previously with no

       intention of returning. Id. at 680.

[12]   We rejected Mills’s argument that his service was reasonably calculated to

       provide notice, noting that “[s]ervice upon a defendant’s former residence is

       insufficient to confer personal jurisdiction.” Id. at 681 (citing Poteet v. Bethke,

       507 N.E.2d 652, 654 (Ind. Ct. App. 1987)). In rejecting Mill’s argument, we

       identified the following fact as particularly relevant: “Mills served Coil at a

       two-year-old address without any independent reason to suspect Coil might still

       be there.” Id. at 681.

[13]   This case is distinguishable from Mills, because of the prior relationship between

       the parties and Goloverya’s actual notice of the lawsuit. Although Nextgear

       used an eighteen-month-old address, it was an address provided by Goloverya

       himself as required by the terms of the Guaranty. Because of their contractual

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       relationship with Goloverya, we conclude that Nextgear had more reason to

       rely on the Grasshopper address’s accuracy and currency than would a party

       that had no previous relationship with the other party, as apparently was the

       case in Mills. Moreover, Goloverya notified Nextgear’s counsel of his

       possession of the summons and complaint, which is evidence that Nextgear’s

       method was reasonably calculated to provide Goloverya with notice.1 Under

       the totality of circumstances in this case, we conclude that Nextgear’s service on

       the Grasshopper address was reasonably calculated to provide notice to

       Goloverya. Consequently, the trial court properly denied Goloverya’s motion

       to set aside the default judgment against him.

[14]   The judgment of the trial court is affirmed.

       Baker, J., and Pyle, J., concur.

       1
         We think it would be somewhat absurd to punish Nextgear for not making further attempts at service once
       Goloverya informed it that he had the summons and complaint. Our caselaw frequently stresses the exercise
       of diligence in service cases, which is perfectly understandable. See, e.g., Munster v. Groce, 829 N.E.2d 52, 61
       (Ind. Ct. App. 2005) (“Harris’ bare-bones affidavit [of diligence in attempting service] does not permit the
       conclusion that due diligence was used to locate Groce’s current whereabouts, or that service via the
       Secretary of State, using an address that apparently was known to be invalid, was reasonably calculated to
       provide Groce notice of this lawsuit.”). We believe, however, that there are few attorneys who would have
       pursued the matter further under the circumstances of this case.

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