NATIONAL UNION FIRE INS. CO. v. SUPERIOR COURT

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Docket Number

Docket No. 23995.

Attorney(S)

Maloney, Chase, Fisher Hurst and Charles Negley for Petitioners. Abraham Setzer for Respondent and for Real Party in Interest.

Judges

AGEE, J.

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Smart Summary

Factual and Procedural Background

This opinion arises from a mandamus proceeding in which the petitioners, including National Union Fire Insurance Company of Pittsburgh, seek to compel the Superior Court of San Francisco to quash service of summons and complaint on them and dismiss the action due to defective service. The underlying action was filed by the real party in interest, Ohio Alton, Inc. The service at issue was made by delivering the summons and complaint to a vice-president of National Union, Bert W. Coyle, but the summons lacked a statutorily required notice. The petitioners argue that this defective service fails to comply with Code of Civil Procedure section 410 and that the action should be dismissed for failure to serve within three years as required by section 581a.

Legal Issues Presented

Whether service of summons on a corporate officer without the statutorily required notice on the summons, as mandated by Code of Civil Procedure section 410, is effective to confer jurisdiction over the corporation.
Whether the failure to effectively serve the summons within three years after commencement of the action requires dismissal under Code of Civil Procedure section 581a.
Whether a stipulation extending time to respond constitutes a general appearance waiving defects in service or the right to dismissal under section 581a.

Arguments of the Parties

Petitioners' Arguments

The service of summons was defective because the copy served on the corporate officer did not contain the required notice mandated by Code of Civil Procedure section 410.
The absence of this notice renders the service ineffective and deprives the court of jurisdiction over the petitioners.
Because effective service was not made within three years of the commencement of the action, dismissal is mandatory under section 581a.
The stipulation extending time to respond does not constitute a general appearance or waiver of the defective service or dismissal rights.

Real Party in Interest's Arguments

Argued that the stipulation entered into with petitioners' attorneys constituted a general appearance and waived defects in service.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Armstrong v. Superior Court (1956) 144 Cal.App.2d 420	Service of summons lacking mandatory endorsement required under Code Civ. Proc. § 474 is fatally defective and deprives court of jurisdiction.	The court analogized the mandatory notice requirement of section 410 to the mandatory notice under section 474, concluding that the service on National Union was similarly ineffective.
Fuss v. City of Los Angeles (1958) 162 Cal.App.2d 643	Reinforces the mandatory nature of statutory notice requirements on summons for effective service.	Supported the conclusion that failure to comply with mandatory notice provisions renders service ineffective.
Davies v. Superior Court (1964) 228 Cal.App.2d 535	Entering into a stipulation extending time to respond does not constitute a general appearance waiving defects in service.	Applied to reject the argument that petitioners waived defective service by stipulating to an extension of time.
Beckwith v. County of Los Angeles (1954) 132 Cal.App.2d 377	Filing a demurrer after expiration of three-year period under section 581a does not waive right to dismissal for failure to serve timely.	Used to support that petitioners' actions after the three-year period do not waive dismissal rights.

Court's Reasoning and Analysis

The court examined the service of summons on National Union, noting that it was delivered to a vice-president with notice that he was served in that capacity. However, the summons copy lacked the required notice mandated by Code of Civil Procedure section 410, which must appear on the summons when serving a corporation. The court found this omission to be a fatal defect, rendering the service ineffective and depriving the court of jurisdiction over the corporation. The court relied on analogous precedent under section 474, which similarly requires mandatory notice endorsements on summons for fictitiously named defendants, recognizing those requirements as mandatory rather than directory.

Because effective service was not made within the three-year period prescribed by section 581a, the court held that the action must be dismissed as to the petitioners. The court rejected the real party in interest’s argument that a stipulation extending the time to respond constituted a general appearance waiving defects in service or the dismissal right, citing section 416.1 and relevant precedent to hold that such stipulations do not waive these rights. Finally, the court noted that any alleged general appearance made after the expiration of the three-year period would be ineffective to prevent dismissal.

Holding and Implications

The court issued a peremptory writ of mandate requiring the Superior Court to enter an order quashing service of summons and complaint on the petitioners and dismissing the action against them pursuant to Code of Civil Procedure section 581a.

The direct effect of this decision is the dismissal of the action against the petitioners due to defective service and failure to serve within the statutory time limit. The court’s ruling enforces strict compliance with statutory notice requirements on summons when serving corporations and affirms that failure to comply deprives the court of jurisdiction. No broader precedent beyond the direct application of these statutory provisions was established.

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NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH et al., Petitioners, v. THE SUPERIOR COURT OF THE CITY AND COUNTY OF SAN FRANCISCO, Respondent; OHIO ALTON, INC., Real Party in Interest.

AGEE, J.

Petitioners seek a writ of mandate requiring respondent court, in an action filed therein by real party in interest, to make its order (1) quashing service of summons upon petitioners for failure to comply with the provisions of Code of Civil Procedure section 410 and (2) dismissing said action as to them for failure to effectively serve the summons therein within three years after the commencement of said action, as provided by section 581a of said code.

The named defendants in said action are petitioner National Union Fire Insurance Company of Pittsburgh, a corporation, and three other corporations. The remaining defendants are fictitiously named as "Does One to Sixteen."

[1] The service under inquiry was made by delivering a copy of the summons and a copy of the complaint to petitioner Bert W. Coyle, a vice-president of petitioner National Union. Coyle was told at the time of such service that he was being served in such capacity and the return of service is so worded.

Real party in interest makes no claim that such service was effective upon Coyle as an individual (see Code Civ. Proc., § 474) and adds that Coyle is not and was never intended to be a party to the action. While the dismissal of an action as to one who is not a party seems to be paradoxical, we think it is proper under the circumstances herein.

With respect to the effectiveness of the service upon petitioner National Union, the following provisions of Code of Civil Procedure section 410 are applicable: "When the service [of summons and complaint] is against a corporation, . . . there shall appear on the copy of the summons that is served a notice stating in substance: `To the person served: You are hereby served in the within action (or proceeding) on behalf of (here state the name of the corporation . . .) as a person upon whom the summons and a copy of the complaint must be served to effect service against said party under the provisions of [Code of Civil Procedure section 411]. . . .' . . In a case in which the foregoing provisions of the section require that notice of the capacity in which a person is served must appear on the copy of the summons that is served, the certificate or affidavit of service must recite that such notice appeared on such copy of the summons, if, in fact, it did appear. When service is against a corporation . . . and notice of that fact does not appear on the copy of the summons or a recital of such notification does not appear on the certificate or affidavit of service of process as required by this section, no default may be taken against such corporation. . . ."

The copy of the summons served upon Coyle did not contain the above-required notice nor did the proof of said service recite that such notice appeared on said copy.

The printed form of summons used had on the bottom of the face thereof the notation, "(Space above for notice required by Secs. 410 and 474, C.C.P.)." This space was left blank.

The above-quoted provisions of section 410 were added in 1959 and our attention has not been called to any decision which discusses this amendment. However, an analogous situation is presented in Armstrong v. Superior Court (1956) 144 Cal.App.2d 420 [ 301 P.2d 51], a personal injury action.

There the complaint named as defendants one Stover and Doe One and Doe Two. One Dolginer was served with a copy of the summons and a copy of the complaint. The copy of the summons so served did not bear the endorsement required by Code of Civil Procedure section 474

This section was amended in 1953 to provide in part as follows: "no default or default judgment shall be entered against a defendant" sued under a fictitious name "unless it appears that the copy of the summons or other process . . . served upon" the defendant bears "on the face thereof a notice stating in substance: `To the person served: You are hereby served in the within action . . . as (or on behalf of) the person sued under the fictitious name of (designating it).' The certificate or affidavit of service must state the fictitious name under which such defendant was served and the fact that notice of identity was given by endorsement upon the document served as required by this section."

The court stated its decision as follows: "We believe, however, that the respondent court was in error in denying plaintiff's motion to quash the service upon the grounds that the summons served upon petitioner was fatally defective in not being endorsed so as to show that the petitioner was served as one of the persons sued under a fictitious name as required by section 474, Code of Civil Procedure (as amended in 1953). . . . This statute is not directory but mandatory, and its effect is to deprive the court of the right to proceed against a defendant served with such a defective summons; that is to say, its effect is to make the service of such a defective summons insufficient to give the court jurisdiction over the person of the defendant." (Italics added.)

To the same effect is Fuss v. City of Los Angeles (1958) 162 Cal.App.2d 643, 646 [ 328 P.2d 831]. (Hearing by Supreme Court denied.)

We think that the provisions of section 410 are likewise mandatory and that the purported service of summons upon National Union was and is ineffective.

[2] Under the provisions of Code of Civil Procedure section 581a, respondent court was therefore under a duty to dismiss the petitioners from the action for failure to effectively serve them with the summons therein "within three years after the commencement of said action," which was on December 18, 1962. (The purported service and the return thereon were made on the last permissible day, Monday, December 20, 1965.)

[3] Real party in interest calls attention to a stipulation entered into on January 7, 1966 between its attorney and the attorneys for National Union wherein the latter was given an extension of time "within which to answer, plead, demur or otherwise move to answer the Complaint. . . ." It suggests that this constituted a general appearance and a waiver by National Union of the defective service. We do not agree.

Section 416.1 of the Code of Civil Procedure, which applies to petitioners' motion to quash, expressly provides that the entering into of such a stipulation does not constitute a general appearance. ( Davies v. Superior Court, 228 Cal.App.2d 535, 540 [ 39 Cal.Rptr. 693].)

The alleged "general appearance" of National Union, made after the expiration of the three-year dismissal period provided for in section 581a, would likewise have no effect upon petitioners' motion to dismiss.

In Beckwith v. County of Los Angeles, 132 Cal.App.2d 377 [ 282 P.2d 87], one of the defendants filed a demurrer to the complaint after the expiration of the three-year period. It was held that this did not operate as a waiver of such defendant's right to a dismissal under the provisions of said section 581a

Let a peremptory writ of mandate issue requiring the respondent court to enter its order quashing service of summons and complaint upon the petitioners in the action bearing number 527840 in that court and then enter its order dismissing said action under the provisions of section 581a of the Code of Civil Procedure.

Shoemaker, P.J., and Taylor, J., concurred.

The petition of the real party in interest for a hearing by the Supreme Court was denied February 15, 1967.