Court Opinion

ID: 9539921
Source: CourtListenerOpinion
Date Created: 2023-08-07 16:11:42.347525+00
Date Added: 2024-06-11T14:59:27.515348
License: Public Domain

EDMONDS, J.,
dissenting.
In Hackett v. Alco Standard Corp., 71 Or App 24, 32-33, 691 P2d 142 (1984), rev den 298 Or 822 (1985), we said, in setting aside a default judgment: *574registered agent was excusably negligent when, after being personally served, he handed the papers to a subordinate without giving clear instructions about their nature or what to do with them and without taking any follow-up measures to assure that appropriate action had been taken. The facts here are different, but not really distinguishable. In both cases, a high officer and registered agent of a corporation acted on a misapprehension that someone else would take care of matters; in both instances the responsible officer’s belief was wrong and his failure to act was negligent, but no more inexcusably so in this case than in Reitz. Compare Lowe v. Institutional Investors Trust, 270 Or 814, 529 P2d 920 (1974).”
*573“The Supreme Court’s and our application of the term ‘excusable neglect’ in ORCP 71B and its predecessor, ORS 18.160, have followed a somewhat undefined course, and recent decisions have turned on fine distinctions between or disregard for other decisions.
“A compendium and discussion of the principal decisions appears in Reitz v. Coca-Cola, 36 Or App 487, 584 P2d 791 (1978). We held in Reitz that the defendant’s president and
*574The majority would distinguish Reitz on the basis of Koford’s failure to act.
“The only significant similarity between Reitz and this case is that in each a corporate officer failed to transmit the summons and complaint to the carrier. In Reitz, the president gave what he believed to be adequate instructions to the controller, who took what he thought was the proper action. The president knew what to do and thought the controller would do it. He did not ignore the complaint. There was a failure to communicate, but not a failure to act. In this case, Koford did nothing for an undetermined period and then sent the papers to Nokes with no suggestion that he expected Nokes to do anything.”
In Hackett, however, the agent for service also did nothing. The defendant’s president and registered agent was served but did not refer the summons and complaint to its insurer because of a mistaken belief that the defendant’s interests would be protected by a codefendant. “Inaction” is not determinative of whether conduct constitutes inexcusable neglect under Reitz.
The majority also fails to consider that Koford did act within the thirty days. After service on July 2, 1987, Koford sent the papers to Nokes, manager of the branch of defendant that sold the policy, assuming that he would forward the papers to defendant’s insurer. There was no established procedure for the handling of legal documents, and this was only the second summons and complaint Koford had seen in 25 years. Nokes testified that he received the papers sometime in July. In late July, Koford telephoned to check on the status of the matter (something the officer in Reitz never did) and discovered that Nokes had not acted. He directed Nokes *575immediately to forward the papers. Corwin testified that she was told on July 31 to mail the papers, but did not do so until August 4 or 5, by which time the default order had been entered.
What is determinative under Reitz is whether the responsible officer was under the misapprehension that someone else would take care of the matter. If that misapprehension is not unreasonable, then the overriding policy that every litigant ought to have his day in court and his rights and duties determined by a decision on the merits of the controversy should prevail in the spirit of justice. See Wagar v. Prudential Ins. Co., 276 Or 827, 832, 556 P2d 658 (1976); King v. Mitchell, 188 Or 434, 442, 214 P2d 993, 216 P2d 269 (1950); 4F2C v. Pacific Health Facilities, 90 Or App 288, 283, 752 P2d 1221, rev den 306 Or 101 (1988). Although Koford may have been negligent, his misapprehension that Nokes was taking care of the matter is no more inexcusable than the misunderstanding in Reitz or Hackett.