09/05/2019 by Dustin M. Paul
Judge Davis entered an interesting ruling, or “non-ruling” as the case may be, on August 8, 2019 in a case captioned Mid-Century Insurance Company v. Thompson, Civ. No. 2:18cv459. The Plaintiff was an insurance company subrogated to the interest of Dwight Mills.
The suit stems from a fire that the Defendant allegedly started with a cigarette. A default judgment was entered ordering the Defendant to pay $176,564.81, the amount the Plaintiff had paid the owner for the loss.
But after the default judgment was entered, a motion to set aside the default was filed arguing that the Plaintiff was incompetent at the time he was served because he suffered from dementia. And it claimed the Plaintiff must have known of this incapacity. At the time of service, the Defendant had signed a power of attorney in favor of his daughter—the spouse of the subrogor-plaintiff.
The Order explains that under North Carolina law, a plaintiff who knows a defendant is incompetent must either serve the defendant’s guardian or a guardian ad litem. Here, however, there is a factual dispute about whether the Defendant was incompetent at the actual time of service. An affidavit was filed that the Defendant had dementia and was unable to care for himself. But Judge Davis notes that little documentation was provided to support that conclusion. Rather than rule on the issue now, the Court provided an additional 60 days for submission of additional affidavits or medical documentation.
The case serves as a good reminder that default judgments are often only the beginning of the litigation process.