Stephens Ex Rel. Houston v. Childers

JOHNSON, J. It is established by the decisions of this Court that a party moving under the provisions of G.S. 1-220 to set aside a judgment rendered against him on the ground of excusable neglect not only must show excusable neglect but also must make it appear that he has a meritorious defense to the plaintiff’s cause of action. Perkins v. Sykes, 233 N.C. 141, 63 S.E. 2d 133; Hanford v. McSwain, 230 N.C. 229, 53 S.E. 2d 84; Whitaker v. Raines, 226 N.C. 526, 39 S.E. 2d 266; Johnson v. Sidbury, 225 N.C. 208, 34 S.E. 2d 67; Parnell v. Ivey, 213 N.C. 644, 197 S.E. 128; Dunn v. Jones, 195 N.C. 354, 142 S.E. 320. The defendant urges that the court erred in finding (1) “that the record discloses no evidence or testimony that would warrant any court in finding excusable neglect,” and (2) in failing to find “that the negligence of Iowa National Mutual Insurance Company constituted excusable neglect on the part of the defendant.” Here the defendant takes the position that the court made no specific finding as to neglect, whether excusable or not, of the defendant, and urges that the court in effect was saying that on the facts presented it had no discretion to set aside the judgments. These contentions are untenable. Negligence of the insurance carrier was conceded. The mooted question was whether its negligence was imputed to the defendant. The clear import of the judgment is that the court found the negligence of the insurance carrier inexcusable and that it was imputed to the defendant. These findings are sustained by the record. All the evidence tends to show that the insurance company assumed the responsibility of defending the action for the defendant with his full knowledge and consent, under circumstances which constituted the insurance company the agent of the defendant for the purpose of employing counsel and arrang *351 ing for the defense of the action. On this record the negligence of the insurance company was inexcusable and clearly imputable to the defendant. The rule is established with us that ordinarily the inexcusable neglect of a responsible agent will be imputed to the principal in a proceeding to Set aside a judgment by default. Stallings v. Spruill, 176 N.C. 121, 96 S.E. 890. See also Kerr v. Bank, 205 N.C. 410, 171 S.E. 367; Morris v. Ins. Co., 131 N.C. 212, 42 S.E. 577; Norwood v. King, 86 N.C. 80; Pate v. Hospital, 234 N.C. 637, 68 S.E. 2d 288. The decisions cited and relied on by the defendant are distinguishable. In the absence of sufficient showing of excusable neglect, the mooted question of meritorious defense becomes immaterial. Pate v. Hospital, supra; Whitaker v. Baines, supra. Upon the record as presented reversible error has not been made to appear. Affirmed.