Ward M. CANADAY, Petitioner,
The SUPERIOR COURT of the State of Delaware IN AND FOR NEW CASTLE COUNTY and the Honorable Charles L. Terry, Sitting as Judge of Said Court, Respondents. Katharine R. Brainard, Executrix under the Last Will and Testament of Millar Brainard, Deceased, and Samuel Vance, Jr., Intervening Respondents.
Rehearing Denied Jan. 3, 1956.
Proceeding on petition for writ of prohibition to end proceedings in action in Superior Court for brokerage fees, which action had been commenced by writ of foreign attachment and purported seizure thereunder of petitioner's stock in domestic corporation, and in which action petitioner had filed answer addressed first to merits of complaint, and had concluded answer with two affirmative defenses attacking process of foreign attachment and Superior Court's personal jurisdiction over defendant, and Superior Court had held that process was invalid. The Supreme Court, Wolcott, J., held that defendant had, by answering to merits of complaint, submitted himself to in personam jurisdiction of Superior Court.
Edwin D. Steel, Jr., of Morris, Steel, Nichols & Arsht, Wilmington, for petitioner.
James R. Morford, of Morford & Bennethum, Wilmington, for intervening respondents.
SOUTHERLAND, C. J., and WOLCOTT and BRAMHALL, JJ., sitting.
[49 Del. 459] WOLCOTT, Justice.
This is a petition for a writ of prohibition to end further proceedings in an action pending in the Superior Court of New Castle. The action was filed by Brainard, the intervening respondent here, against Canaday for brokerage fees, and was commenced by a writ of foreign attachment and the purported seizure under it of Canaday's stock in a Delaware corporation.
After the purported seizure, Canaday petitioned the Superior Court for leave to appear specially in the action in order to attack the validity of the writ of foreign attachment and the seizure under it. His petition to appear specially for this purpose was not pressed to hearing. Ultimately, Canaday directed the entry of a ‘ general appearance’ and filed an answer to the complaint. His answer was addressed first to the merits of the complaint but concluded with two affirmative defenses attacking the process of foreign attachment. The first affirmative defense was that the writ did not comply with 8 Del.C. § 324(b). The second affirmative defense was that the Superior Court had acquired no personal jurisdiction over Canaday because the writ of foreign attachment under which his stock had purportedly been seized was an illegal attempt to coerce him into appearing before the Superior Court. We think both affirmative defenses raised the same question, viz., the sufficiency of the process of foreign attachment.
The Superior Court, Brainard v. Canaday, 112 A.2d 862, first passed upon the sufficiency of the two affirmative defenses [49 Del. 460] and held that the process was invalid, but that, since Canaday had appeared generally in the cause, he had submitted himself to the personal jurisdiction of the Superior Court. It therefore proposed to order that the cause continue upon its merits as an action in personam .
Forthwith, Canaday petitioned this court for a writ of prohibition. Brainard, intervening in this court, moved to limit the issues raised by the petition. We subsequently held that the sole question presented by the petition was whether or not Canaday had appeared in the action and thus submitted himself to in personam jurisdiction of the Superior Court. See Canaday v. Superior Court, 116 A.2d 678. That question is now before us for decision.
Canaday argues that Rule 12(b) of the Superior Court, Del.C.Ann., permits the joinder in one pleading of defenses attacking
the jurisdiction of the court with a defense to the merits without the waiver of any possible defense. It is, therefore, argued that special appearances are no longer necessary in the Superior Court to attack jurisdiction, and that an appearance to raise jurisdictional questions even though joined with an answer to the merits does not constitute a waiver of the jurisdictional point. Canaday concludes, therefore, that since his affirmative defense attacking the validity of the process which sought to coerce his appearance has been sustained by the Superior Court, he has not submitted himself in any respect to personal jurisdiction, even though he has answered generally to the merits of the action which, under Rules 5(aal), is an appearance.
Brainard, on the other hand, argues that since the foreign attachment statute establishes the procedure to be followed in all actions commenced by the writ, and specifically provides for the entry of default judgment after seizure unless the non-resident defendant comes into court and submits himself to complete personal jurisdiction, this statutorily established procedure cannot be altered by rule of court. He concludes that the acceptance [49 Del. 461] of Canaday's argument would result in an illegal alteration of the statutory scheme.
The statute governing the use of the mesne process of foreign attachment provides for the seizure of the property of a non-resident defendant after the commencement of an action in the Superior Court, and for the entry of a default judgment in that action against the non-resident defendant at the second term following the issuance of the writ unless he appears. It further provides that an appearance by the non-resident in the action shall not dissolve the attachment, but that it shall continue to bind the seized property as security for any personal judgment ultimately recovered unless the appearing defendant gives security to the extent of the value of the property seized.
The purpose of the Delaware Foreign Attachment Statute is to coerce a non-resident defendant who owns property within the State into submitting to personal jurisdiction upon pain of forfeiture of his seized property. Blaustein
v. Standard Oil Co., 4 Terry 516, 51 A.2d 568; Kaiser-Fraser Corporation
v. Eaton, 7 Terry, 509, 85 A.2d 752. The Delaware statute has successfully withstood the test of Federal Due Process. Ownbey v. Morgan, 256 U.S. 94, 41 S.Ct. 433, 65 L.Ed. 837.
Prior to the promulgation in 1948 of the present rules of the Superior Court, each non-resident defendant whose property had been seized had under the statute various courses of action open, which he could have elected to pursue at his discretion. Thus, he could have appeared generally, thereby submitting himself to complete personal jurisdiction, and have given security to dissolve the attachment, or have permitted the attachment to stand as security for the ultimate satisfaction of any personal judgment which might be obtained against him. On the other hand, if he did not elect to appear generally he could have appeared specially, thereby not submitting himself to personal jurisdiction, and have attacked the validity of the foreign attachment. [49 Del. 462] If that attack proved successful, he would have obtained the release of his property from the seizure. Furthermore, he could have elected to proceed by a combination of these two alternatives. Thus, after appearing specially and obtaining the release of his property from the seizure, he could have entered, if he so desired, a general appearance and have defended the action on its merits, without there being in the action any security for the satisfaction of a judgment ultimately recovered against him. Finally, either initially or after having appeared specially and having lost his attack upon the validity of the attachment, he could have elected to let the matter go by default, in which event a default judgment would have been entered against him and
the seized property sold to satisfy that judgment either totally or partially.
Under the statute and the former practice, plaintiffs in actions commenced by foreign attachment had the right to seize property of a non-resident defendant in order to coerce his submission to the personal jurisdiction of a Delaware court. In the event the validity of the attachment was sustained under attack, or was not attacked, and if the non-resident did not submit to personal jurisdiction by appearing in the action, the plaintiff had the right to a default judgment against the non-resident and to have the seized property sold to satisfy the judgment. Under the former practice, plaintiffs also knew from the procedure followed by the defendant just what course of action he had elected. We think the right to be informed is an important consideration because of the possibility of perfecting a faulty seizure of property through the use of alias writs of attachment.
Under the former practice these rights of plaintiffs and non-resident defendants, whether they be regarded as matters of substance or of mere procedure, were established by statute, judicial construction and practice. The petition before us, and [49 Del. 463] the arguments of counsel, present the basic question of whether or not the Rules of Civil Procedure of 1948 now regulate the procedure in ...