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Leeper v. Safebuilt Georgia, Inc.

Court of Appeals of Georgia, Fourth Division

November 13, 2019

LEEPER et al.
v.
SAFEBUILT GEORGIA, INC.

          DOYLE, P. J., COOMER and MARKLE, JJ.

          DOYLE, PRESIDING JUDGE.

         Jeffrey and Ashley Leeper filed suit in Fulton County Superior Court against Safebuilt Georgia, Inc., and other defendants, asserting various claims arising out of the construction of their home. The Leepers subsequently voluntarily dismissed the Fulton County action and refiled the case in Gwinnett County Superior Court. After filing an untimely answer, Safebuilt moved to extend the time to answer and/or to open default, and the trial court granted the motion on both grounds and certified its order for immediate review. The Leepers challenge the trial court's order in this interlocutory appeal. For the reasons that follow, we affirm.

         The record shows that in December 2017, the Leepers filed suit in Fulton County Superior Court against Safebuilt (as indemnitor for the City of Milton) and several other defendants, including their builder, asserting claims arising out of the construction of their Milton home. The Leepers alleged that Safebuilt, which provided inspection services throughout the construction process pursuant to an agreement with the City, breached the contracts between Safebuilt and the City by failing to identify various defects and code violations during its inspections.[1] They also alleged claims against "all [d]efendants" for negligent construction, breach of express warranties, breach of implied warranties, and deceptive trade practices. Later that same month, the Leepers voluntarily dismissed the Fulton County action without prejudice.[2]

         On December 26, 2017, the Leepers refiled the case in Gwinnett County Superior Court; they served Safebuilt's agent with a copy of the summons and verified complaint on December 28, 2017. Nevertheless, in February 2018, the Leepers and Safebuilt, through counsel, filed a stipulation in the Fulton County action extending the deadline for Safebuilt to file an answer. On February 13, 2018, Safebuilt filed an answer in Fulton County, and it responded to the Leepers' discovery requests in that case the same month.

         On May 18, 2018, upon learning that the Leepers had refiled their case in Gwinnett County, counsel for Safebuilt immediately asked counsel for the Leepers to stipulate in the Gwinnett case "to correct the record and get everything that had been filed in the Fulton County action by Safebuilt [filed] in the Gwinnett County [c]ase." The Leepers' counsel refused to so stipulate, and instead, on May 21, 2018, moved for a default judgment against Safebuilt in the Gwinnett County case. The following day, Safebuilt filed an unverified answer, and on June 8, 2018, it filed an emergency motion to open default or to extend the time to answer. Safebuilt asserted that (a) it never received notice of the dismissal of the Fulton County action, (b) it first learned of the Gwinnett County action in May 2018, [3] and (c) due to a misunderstanding and mistake on the part of both Safebuilt and the Leepers, all of Safebuilt's prior filings had been submitted in the Fulton County action.

         The trial court granted Safebuilt's motion to open default pursuant to OCGA § 9-11-55 (b) on the ground of excusable neglect and, alternatively, also granted the motion for an extension of time to file its answer pursuant to OCGA § 9-11-6 (b) for the same reason. The court observed in the order that Safebuilt had paid costs and pleaded a meritorious defense under oath, and the Leepers would not be prejudiced by opening the default and lacked "clean hands" given their superior knowledge of the dismissal of the Fulton County action. The trial court subsequently certified its order for immediate review, and this appeal followed.

         1. Motion to open default.

         The Leepers argue that the trial court erred by granting Safebuilt's motion to open default. We disagree.

         Unless otherwise provided by statute, a defendant in a civil case must file an answer within 30 days of service of the summons and complaint upon the defendant.[4]If an answer is not filed within the time required by the Civil Practice Act, "the case shall automatically become in default unless the time for filing the answer has been extended as provided by law."[5]

Under OCGA § 9-11-55 (b), a prejudgment default may be opened on one of three grounds if four conditions are met. The three grounds are: (1) providential cause, (2) excusable neglect, and (3) proper case; the four conditions are: (1) showing made under oath, (2) offer to plead instanter, (3) announcement of ready to proceed with trial, and (4) setting up a meritorious defense. This [C]ourt has previously held that the "showing" required by this Code section to be made "under oath" includes the showing of a "meritorious defense." Generally, the opening of a default rests within the sound discretion of the trial court. However, compliance with the four conditions is a condition precedent; in its absence, the trial judge has no discretion to open the default.[6]

         "The rule permitting opening of default is remedial in nature and should be liberally applied, for default judgment is a drastic sanction that should be invoked only in extreme situations. Whenever possible cases should be decided on their merits [because] default judgment is not favored in law."[7]

         (a) Statutory conditions precedent. In support of its motion to open default, Safebuilt filed affidavits of its attorney averring that Safebuilt offered to plead instanter and was ready to proceed to trial without delay, subject to its right to file a motion to dismiss. The Leepers do not challenge the trial court's ruling that Safebuilt met those three conditions precedent to opening default. Instead, they argue on appeal that Safebuilt failed to set up a meritorious defense.

         The requirement that a defendant set up a meritorious defense "does not require a defendant to show that it will completely defeat plaintiff[s'] claim; rather, the defendant must demonstrate that if relief from default is granted, the outcome of the suit may be different from the result if the default stands."[8] Here, ...


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