Anderson v. Hull

Bruñe, C. J., delivered the opinion of the Court. This case comes to us in a thoroughly confused state, due in no small measure, we believe, to the fact that the appellants (defendants in the trial court) have undertaken to represent themselves in this litigation. The appellants make two contentions in their brief: one that they were denied due process of law in contravention of the Fourteenth Amendment to the Constitution of the United States; the other, that the trial court erred in entering judgment by default against them. We find it necessary to consider only the second contention.

On February 3, 1956, the plaintiffs (now appellees), Ralph E. D. Hull and Belva A. C. Hull, his wife, docketed a suit in the Circuit Court for Carroll County against the defendants (now appellants), Elmer O. Anderson and Dorothy D. Anderson, his wife, on a confessed judgment note. The Clerk, acting under Rule 1 of the General Rules of Practice and Procedure, Part Three, II, Judgments by Confession, then in force (now Rule 645 of the Maryland Rules, effective January 1, 1957), entered judgment by confession in favor of the plaintiffs and against the defendants for the sum of $6,455.73, plus interest from the date of judgment, court costs and 10% as attorneys’ fees for collection, and issued summons for the defendants which was served on the defendants on October 4, 1956. The defendants, acting within the time allowed for moving to strike out the judgment, filed a document entitled “Defendants’ Plea”, which was in the form of a letter dated November 5, 1956, addressed to the Chief Judge of the Circuit Court. It was accompanied by two enclosures referred to below.

There was a hearing on the matter .on December 3, 1956. The Judge took the matter under consideration and filed an opinion and order in the matter on January 29, 1957. The opinion pointed out that when the suit was filed only two instalments aggregating ⁴⁷⁹ $2,500 in principal amount were due on the note out of a total balance of $6,250 (in principal amount) remaining unpaid on the original principal amount of $15,000. The note was dated May 5, 1954, and provided for quarterly payments of $1,250 each, with interest at 5 °/o.

There was no provision for acceleration of the balance on non-payment of any instalment when due. One of the two enclosures submitted with the “Defendants’ Plea” was a copy of a notice published (apparently as a paid advertisement) by Mr. and Mus. Anderson in the October 18, 1956, issue of a Westminster newspaper, as President and Vice President, respectively, of Anderson Chrysler, Incorporated. This notice stated their intention to liquidate the business of that corporation, to apply the proceeds to the payment of its obligations and to assume personally the payment of any corporate liabilities not paid out of the corporate assets.

The other enclosure was a printed copy of a proposed open letter which the defendants had submitted for publication as a paid advertisement in two Westminster newspapers, which these papers were said to have refused to accept for publication “because of its legal connotations.” It would be of no use to summarize the whole of the “open letter”, which purports to review a long controversy. It indicates, among other things, that in 1953 Mr. Anderson bought out the interest of a Mr. Kemper in a partnership which had existed for some years between Mr. Kemper and Mr. Hull in an automobile dealership business, that the business had been incorporated when Anderson bought Kemper’s interest, that Messrs. Hull and Anderson had become officers and stockholders of the corporation, that they soon came to the parting of the ways and that Anderson then undertook to buy out Hull’s interest in the business, that the note here involved represented a part of the purchase price, that Hull entered into some sort of covenant not to compete (whether with the Andersons, the corporation or both was not clear), and that Anderson claimed that Hull had violated this agreement. The trial Judge ordered the judgment by confession to be stricken out, but preserved its lien, and granted leave to the ⁴⁸⁰ defendants to plead within fifteen days (from January 29, 1957).

Under date of February 12, 1957, the Andersons wrote a letter to the Judge in which they said that they had understood that there would be a further hearing at which they would be allowed to present their case, but that they construed his decision of January 29th as meaning that a judgment had been entered against them. 'They also challenged the note — apparently on the ground that the plaintiffs had violated the agreement pursuant to which the note was executed and they asserted that the plaintiffs’ violation of the agreement had caused irreparable damage to them and “to the corporations (Hull and Anderson, Inc. and Anderson Chrysler, Incorporated)” and asked that the judgment-for the plaintiffs against them be set aside and damages of $50,000 be awarded them. The respective interests of the Andersons and of the named corporations were not made clear. The Judge replied to this letter on February 13, 1957, pointing out that he had stricken out the judgment, but had retained the lien, and had allowed the defendants fifteen days in which to file pleas. He further informed them that, assuming that proper pleas would be filed, the case was set for March 13, 1957, at 10 A. M. He closed with this advice: “As pleading at law is highly technical, I would suggest that you immediately engage an attorney to prepare your pleas.” The appellants did not heed this wise advice.

The record does not show any hearing on March 13th, but it does show that on March 18th, 1957, which was much more than fifteen days after the order of January 29th, the defendants