Tennessee Court of Appeals Vacates a Williamson County Chancery Court’s Order of Default Judgment

Regions Bank v. Chas A. Sandford, No. M2015-02215-COA-R3-CV

November 21, 2016

Service of process is essential to the tenant of due process. Service of process, in simple terms, means the delivery of legal papers. Once a lawsuit has been filed against a defendant, the plaintiff must serve the defendant with all of the legal papers. Only then can the lawsuit move forward. If the defendant is not properly served with process, the lawsuit cannot continue. If the defendant is properly served with process, then the lawsuit may continue pursuant to the applicable rules of procedure.

The Tennessee Rules of Civil Procedure (“Tenn. R. Civ. P.”), govern all aspects of civil procedure in the Chancery Courts of Tennessee. Tenn. R. Civ. P. 4.04 states, generally, that an individual defendant must be served with process personally, or by leaving process at the defendant’s usual dwelling house with a person of suitable age and discretion. Another option for service is that the plaintiff may mail process to the defendant by certified mail requesting restricted delivery. (See Tenn. R. Civ. P. 4.04(1)-(11) for a full list of acceptable forms of service). After the defendant has been served with process by an available method, the plaintiff must file proof of service with the court. Tn. R. Civ. P. 5.03.

If a defendant is properly served with process and fails to file a responsive pleading within the appropriate amount of time, then the plaintiff may ask the court to enter a default judgment against the defendant. Tn. R. Civ. P. 55.01.

In Regions Bank v. Chas A. Sandford, No. M2015-02215-COA-R3-CV (Tn. Ct. App. November 16, 2016), the Tennessee Court of Appeals at Nashville, vacated a default judgment ordered by the Williamson County Chancery Court. In that decision, the plaintiff’s process server attempted to serve the defendant eleven times without success. Following the eleven attempts at service, plaintiff again attempted to serve the defendant by certified mail. The United States Postal Service returned the receipt marked, “Return to Sender,” “Unclaimed,” and “Unable to Forward.” The plaintiff then filed an affidavit indicating that service had been properly completed – even though service was not completed pursuant to the Tenn. R. Civ. P.

Regions Bank then filed a motion for default judgment against the defendant. Defendant finally responded by filing a “special appearance” contesting service of process. On September 25, 2015, the Williamson County Chancery Court granted plaintiff’s motion and entered a default judgment for $153,274.13 against the defendant. The defendant appealed.   

The Court of Appeals held that service cannot be completed by mail unless the record contains a return receipt showing personal acceptance by the defendant. A return receipt marked “unclaimed” does not show personal acceptance by a defendant and therefore cannot serve as a basis for an entry of a default judgment.

Regions Bank argued on appeal that the defendant was on notice of the lawsuit because he filed a “special appearance”. The Court of Appeals found that argument to be without merit because the law is clear: “actual notice of the lawsuit is not a substitute for service of process when the Rules of Civil Procedure so require.” Thus, the Court of Appeals held that the trial court abused its discretion by entering a default judgment based on service of process by mail with a return receipt marked “unclaimed.” In so finding, the Court of Appeals vacated the Williamson County Chancery Court’s order of default judgment against the defendant.

Service of process is vital in Tennessee to ensure that a defendant’s due process rights are protected. If a defendant is not properly served, no judgment may result. However, if the court does enter a judgment against a defendant that has not been properly served, that judgment could be vacated.

If you are a defendant and have had a judgment entered against you by default, you may have options to have the judgment vacated. It is important that you seek the advice of legal counsel. The attorneys at Meridian Law, PLLC, may be able to assist. Call Meridian today at (615) 229-7499.