Entry Of Default Only Allowed Upon Adequate Notice To The Defaulting Party

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Law Updates -Civil Procedure: Default Judgment, Service and Adequate Notice of Application for Default Champlin v. Bank of America, 653 Ariz. Adv. Rep. 23 (App. Div II, January 31, 2013) (J. Ekerstrom) NOTICE OF APPLICATION FOR ENTRY OF DEFAULT MUST BE MAILED BEFORE OR SIMULTANEOUSLY WITH APPLICATION OR DEFAULT IS A NULLITY

A mortgaged residential property was destroyed by fire. Allstate Property & Casualty [Allstate] sued the mortgagor Bank of America [bank] and served its statutory agent on November 18, 2011. On February 2, 2012 Allstate filed an application for entry of default against the bank and Allstate's attorney avowed on February 1 that she had sent a copy of the application, on that date via first class mail to the bank's statutory agent. The clerk signed and dated the entry of default but the certificate of mailing was undated and unsigned. On March 5 Allstate filed a motion for default judgment and lodged a form of judgment. On March 7, the bank moved to set aside the entry of default with proof the application for default was not mailed until February 22. Allstate did not oppose the motion. The trial court denied the motion to set aside finding no "excusable neglect" and particularly noting that even as of the date of the motion to set aside the bank had not filed an Answer. The Arizona Court of Appeals reversed and remanded.

The court of appeals turned to Rule 55 of the Arizona Rules of Civil Procedure which allows entry of default only upon adequate notice to the defaulting party. The rule is intended to "virtually eliminate any claim of lack of notice." Here the trial court seemed to acknowledge the notice was not sent until February 15, nearly two weeks after the entry of default and clearly beyond the ten day grace period allowed before the entry of default. In order for notice to be proper and in conformance with Rule 55 it must be provided either before, or simultaneously with the filing of the application for entry of default. If the plaintiff fails to mail timely notice it need only re-file the application with a timely notice. Whether the defendant files an Answer before or after actual notice of the application has no bearing upon the invalidity of an untimely notice.

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