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2011-UP-184 - Houston Enterprises, Inc. v. Vision Investment & Development, LLC

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Houston Enterprises, Inc., Respondent,

v.

Vision Investment & Development, LLC, Vision River Ridge, LLC, James R. Barfield, Dana R. Bradley, and Performance Holdings, Appellants.


Appeal From York County
 John C. Hayes, III, Circuit Court Judge


Unpublished Opinion No.  2011-UP-184
Submitted February 9, 2011 – Filed April 25, 2011 


AFFIRMED


Shawn M. French, of Mount Pleasant, for Appellants.

W. Keith Martens, of Rock Hill, for Respondents.

PER CURIAM: We affirm the circuit court's order striking Appellants' answer for failure to comply with Rule 11, SCRCP, entering default judgment against Appellants, and denying Appellants' motion to dismiss for lack of personal jurisdiction.[1]

Houston Enterprises, Inc., filed this action on February 18, 2009, and served the summons and complaint on all Appellants by March 3, 2009.  Appellants retained Joel S. Wadsworth, a lawyer who is not licensed to practice law in South Carolina.  On March 27, 2009, Wadsworth requested an extension of time for Appellants to answer the complaint, citing Appellants' need to retain a South Carolina licensed attorney.  Houston's counsel consented to an extension of time through May 1, 2009.  On April 30, 2009, Wadsworth requested a second extension of time for Appellants to answer.  At the time of the second request, Wadsworth indicated that Appellants had retained a South Carolina licensed attorney in Horry County, but the South Carolina attorney was affected by recent wildfires in the area and needed another extension.  Houston consented to a second extension of time through May 8, 2009. 

On May 7, 2009, Wadsworth requested a third extension of time; however, Houston's counsel refused to consent to the third extension.  On May 8, 2009, Wadsworth filed an answer on behalf of Appellants.  The answer was signed by Wadsworth, but was not signed by any attorney licensed to practice in South Carolina.  On May 21, 2009, Houston's counsel notified Appellants that he intended to move to strike the answer and affirmative defenses because the answer was not signed by South Carolina counsel.  Ten days later, on June 1, 2009, counsel for Houston filed a motion to strike the answer and for default judgment against Appellants.  On June 11, 2009, ten days after Houston filed its motion to strike and more than thirty days after Appellants' last extension of time to answer had expired, Appellants filed a motion to dismiss for lack of personal jurisdiction. 

After a hearing on July 30, 2009, the circuit court granted Houston's motion to strike because Appellants' answer was not signed by an attorney licensed in South Carolina and violated Rule 11(a), SCRCP.[2]  Accordingly, the circuit court found that Appellants were in default because they "did not serve a proper answer or other responsive pleading within the time required by the South Carolina Rules of Civil Procedure," and entered a default judgment against Appellants.  The circuit court also denied Appellants' motion to dismiss for lack of personal jurisdiction because the motion was not timely filed.  The circuit court later denied Appellants' motion to reconsider. 

The standard of review for an appellate court reviewing an order that strikes a party's pleading is whether the circuit court abused its discretion.  Robinson v. Code, 384 S.C. 582, 585, 682 S.E.2d 495, 496 (Ct. App. 2009).  The circuit court abuses its discretion only when the court's conclusion is controlled by an error of law or is without evidentiary support and results in prejudice to appellant's rights.  QZO, Inc. v. Moyer, 358 S.C. 246, 256, 594 S.E.2d 541, 546-47 (Ct. App. 2004).

I. Rule 11(a), SCRCP

The circuit court properly struck Appellants' answer because the answer was not signed by a licensed South Carolina attorney in violation of Rule 11(a), SCRCP, and Appellants did not promptly remedy the omission. 

Rule 11(a) provides,

Every pleading, motion or other paper of a party represented by an attorney shall be signed in his individual name by at least one attorney of record who is an active member of the South Carolina Bar    . . . .  A party who is not represented by an attorney shall sign his pleading, motion or other paper and state his address. . . .  If a pleading, motion or other paper is not signed or does not comply with this Rule, it shall be stricken unless it is signed promptly after the omission is called to the attention of the pleader or movant.

Rule 11(a), SCRCP (emphasis added). 

Appellants' answer was signed only by Wadsworth, who was not licensed to practice law in South Carolina.  Consequently, the answer violated Rule 11(a), SCRCP.  Houston brought this omission to Appellants' attention by email correspondence to Wadsworth on May 21, 2009, and again by filing a motion to strike on June 1, 2009.  At the time of the hearing on July 30, 2009, Appellants had not taken any action to remedy this defect.  Moreover, Appellants' reasons given for requesting extensions of time to file an answer demonstrate they were aware of the requirement for South Carolina counsel.  Therefore, the circuit judge properly struck Appellants' answer as required by Rule 11(a), SCRCP.

II. Default Judgment

Appellants contend that the circuit court erred in entering default judgment after striking their answer, citing Rules 55(c) and 60(b), SCRCP.  However, Appellants never made a motion to the circuit court under either rule.  Therefore, the issue is not preserved for our review.  Hardaway Concrete Co. v. Hall Contracting Corp., 374 S.C. 216, 224, 647 S.E.2d 488, 492 (Ct. App. 2007) (noting an issue must be raised to and ruled on by the trial court in order to be preserved for appellate review).   

Appellants also contend the circuit court erred in not granting their motion to dismiss for lack of personal jurisdiction.  Rule 12(b), SCRCP, requires such a defense to be asserted in the responsive pleading or by motion "before pleading if a further pleading is permitted."  Appellants did not file their motion to dismiss for lack of personal jurisdiction until June 11, 2009, ten days after Houston filed its motion to strike and more than thirty days after Appellants' last extension of time to answer had expired.  Therefore, the circuit court properly held that the motion to dismiss was untimely and refused to consider it. 

AFFIRMED.

FEW, C.J., THOMAS and KONDUROS, JJ., concur.


[1] We decide this case without oral argument pursuant to Rule 215, SCACR.

[2] The circuit court noted that "the second extension was technically not permitted by the South Carolina Rules of Civil Procedure."  See Rules 12 and 6(b), SCRCP.  However, he accepted the answer in terms of timeliness stating, "the court will accept that May 8, 2009 was the extended deadline for the defendants to answer or otherwise plead in response to Houston's complaint."