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McCulley v. Brooks & Co. General Contractors Inc.

Supreme Court of Virginia

July 19, 2018

COLIN McCULLEY
v.
BROOKS & CO. GENERAL CONTRACTORS, INC.

          FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND W. REILLY MARCHANT, JUDGE

          OPINION

          D. ARTHUR KELSEY JUSTICE

         In this case, a landlord obtained a default judgment against a commercial tenant and its guarantor for unpaid rent. The judgment was void as to the guarantor, however, because the landlord failed to properly serve the complaint on him. Despite this fact, the circuit court found that the guarantor had entered a general appearance during post-judgment enforcement proceedings and thereby had waived any objection to the validity of the default judgment. We disagree and reverse.

         I.

         In 2013, Brooks & Co. General Contractors, Inc. ("Brooks & Co.") leased office and warehouse space to Plastic Lumber & Outdoor, LLC ("Plastic Lumber"). Colin McCulley personally guaranteed Plastic Lumber's lease obligations. In May 2016, Brooks & Co. filed a complaint against Plastic Lumber and McCulley for unpaid rent, utilities, late fees, interest, and attorney fees and costs.

         Brooks & Co. served process on McCulley by posting it to his front door pursuant to Code § 8.01-296(2)(b), see J.A. at 68, but the record fails to demonstrate that Brooks & Co. followed the additional requirements of that statute to mail a copy of the process to McCulley 10 days before obtaining a default judgment and to file a certificate of mailing in the circuit court clerk's office, see id. at 95. After neither Plastic Lumber nor McCulley filed responsive pleadings, Brooks & Co. obtained a default judgment against both defendants. The circuit court entered the default judgment on July 7, 2016.

         On August 24, 2016, the circuit court clerk issued a summons commanding McCulley to appear before a commissioner in chancery on September 15 to answer debtor's interrogatories. McCulley's counsel thereafter contacted the commissioner and successfully requested that the date be rescheduled to September 27. On September 19, McCulley filed a motion to vacate the default judgment in the circuit court, the first sentence of which reads:

COMES NOW COLIN MCCULLEY by counsel, MAKING A SPECIAL APPEARANCE FOR THE SOLE PURPOSE OF CONTESTING THIS COURT'S EXERCISE OF PERSONAL JURISDICATION [sic] BUT NOT OTHERWISE SUBMITTING TO THE COURT'S PERSONAL JURISDICATION [sic], pursuant to Virginia Code § 8.01-428(A) and respectfully prays that this Honorable Court will vacate the Default Judgment . . . as the same is a void judgment.

Id. at 65. The motion asserted that Brooks & Co. had failed to properly serve the complaint, thereby depriving the circuit court of personal jurisdiction over McCulley, and that the default judgment was therefore void. See id. at 65-67. McCulley concluded his motion by reiterating that he had "made this SPECIAL APPEARANCE for the sole purpose of contesting this Court's exercise of personal jurisdiction over him." Id. at 67. Brooks & Co. did not file any written response to the motion and later made no claim that its attempted service of process was valid.

         At some point prior to September 27, 2016, McCulley's counsel advised opposing counsel that he would ask the commissioner to stay the debtor's interrogatories until the circuit court had an opportunity to rule on his motion to vacate the default judgment. See id. at 85, 90. On September 26, the day before the rescheduled meeting at the commissioner's office, Brooks & Co.'s counsel emailed his response: "There is no legal basis on which to stay the interrogatories, as such, I would object to the seeking of any stay of collection proceedings, as the judgment is final." Id. at 90. A later email from Brooks & Co.'s counsel to the commissioner confirmed that McCulley had made the stay request and that the commissioner had ultimately rejected it. See id. at 91-92.

         The debtor's-interrogatory proceedings continued for several months. After an order of production directed to McCulley went unanswered, Brooks & Co.'s counsel requested that the commissioner issue a show-cause order demanding compliance upon penalty of being held in contempt. See id. The commissioner responded by instructing the parties that "[a]ny enforcement action would have to come from the Circuit Court." Id. at 92. He advised them to present the enforcement request "at the same time as the Motion to Vacate [was] heard" in the circuit court. Id.

         The circuit court conducted a hearing on McCulley's motion to vacate and ruled that the "initial service" of process on him "was defective" but that "McCulley waived any objection to this defect in service by making a general appearance in this case through his post-judgment participation in Debtor's Interrogatories." Id. at 95. The court's letter opinion, incorporated by reference into its final order, held that a general appearance during enforcement proceedings on a final judgment could effectively waive any claim that the judgment was void ab initio. See id. at 78-82.

         II.

         On appeal, Brooks & Co. concedes that it failed to certify that it had satisfied the mailing requirement of Code § 8.01-296(2)(b).[1] The only issue before us is whether McCulley waived his right to challenge the default judgment as void ab initio by participating in the ...


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