Another Process Server (& Rubber-Stamping Judge's) Screw-Up, Another Void Judgment Vacated On Appeal; Foreclosed Homeowner Stalls Getting The Boot

A recent ruling by an Arizona appeals court again illustrates how a sloppy (or possibly corrupt) process server can submarine a legal action, even after a court judgment has already been granted.

The case involved an attempt by a purchaser at a foreclosure sale to boot an ex-homeowner out of a home that was auctioned off at the public sale. In serving the ex-homeowner with notice of a forcible detainer action to oust him from the property, the process server improperly attempted service of process using the "post & mail" method of service (also known by some as "nail & mail").

Despite this screw-up, the lower court judge compounded the problem by approving the use of the improper method, which required this appeal, resulting in the proper vacating of the lower court judgment.(1)

Although this ruling involved an ex-homeowner's attempt to dodge the boot after a foreclosure sale took place (as opposed to an attempt to vacate the foreclosure sale itself), it should nevertheless serve as a reminder to all those now-foreclosed, ex-homeowners in judicial foreclosure states wanting to reclaim possession of their homes to review (or have an attorney review) the affidavits of service filed by process servers in their cases to see if they committed a screw-up (or engaged in corruption) that is fatal to the foreclosure judgment, and warranting a vacating (voiding, setting aside) thereof.(2)

For the ruling, see Arizona Real Estate Inv., Inc. v. Schrader, No. 1 CA-CV 10-0038 (Az. Ct. of App. Div. 1, November 9, 2010).

(1) According to the appeals court ruling, the lower court has the authority under Arizona statute to authorize an alternative method of service when attempting service by the statutorily-mandated method proves "impracticable." Regarding said "impracticability" in this case, the appeals court ruled (at page 6, ¶¶ 11-12) (bold text is my emphasis, not in the original text; link to cited case may require free registration with FindLaw.com):

• The record here does not establish impracticability. The process server’s affidavit is silent as to whether he made more than one attempt to serve Schrader, who still resided in the home. The affidavit includes no facts attesting to any impediments to or evasion of personal service. See Barlage v. Valentine, 210 Ariz. 270, 273, ¶¶ 6-8, 110 P.3d 371, 374 (App. 2005) (affidavit of due diligence was inadequate where the affidavit merely asserted that a due diligence effort had been made without setting forth any facts showing such an effort). The process server did not testify.

• Nothing in this record establishes the "impracticability" that might justify alternative service under Rule 4.1(m). The superior court commented on "the need to make speedy and quick determinations of forcible detainer actions." Although this is a legitimate concern, it cannot be the sole basis for establishing impracticability.

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In the above-referenced Barlage v. Valentine case, the Arizona appeals court noted the following universally-accepted truth regarding the proper service of process in a legal proceeding (bold text is my emphasis, not in the original text):

• Proper, effective service on a defendant is a prerequisite to a court's exercising personal jurisdiction over the defendant. Koven v. Saberdyne Sys., Inc., 128 Ariz. 318, 321, 625 P.2d 907, 910 (App.1980) (“Proper service of process is essential for the court to have jurisdiction over the defendant.”);  Kadota v. Hosogai, 125 Ariz. 131, 134, 608 P.2d 68, 71 (App.1980) (“[T]he law is clear that a judgment is void if the trial court did not have jurisdiction because of a lack of proper service.”).

(2) For three New York cases that illustrate how the improper use of the 'nail & mail' method of process serving can submarine a foreclosure action, see:

• Citigroup Global Markets Realty Corp. v. Bowling, 25 Misc 3d 1244; 2009 NY Slip OP 52567U (NY Sup. Ct. Kings County, December 18, 2009) (motion to proceed with foreclosure denied where process server failed to exercise due diligence in attempts to track down homeowner),
• HSBC Bank USA, N.A. v Fleurimond, 2008 NY Slip Op 52320(U) (NY Sup Ct, Kings County, November 18, 2008) (foreclosure sale set aside),
• Countrywide Home Loans, Inc. v Bouvin, 09/28/2009, 2009 NYSlipOp 32670(U) (NY Sup. Ct. Suffolk County, September 28, 2009): The court made this point regarding the exercise of due diligence by the process server when using the "nail & mail" method:
  
  The "due diligence" portion of the plaintiffs affidavit of service indicates that prior to the "nail and mail" service, the process server attempted to deliver the summons and complaint to the defendant(s) on 4/30/08 at 5:30 pm, on 5/17/08 at 10:30 am. The "nailing" was then accomplished on 6/7/08, with the '"mailing" being effectuated several days later. There is no indication that the process server attempted to inquire about or serve the defendant(s) at a place of employment. The "nail and mail" method of service pursuant to CPLR §308(4) may be used only where personal service under CPLR §308(1) and (2) cannot be made with "due diligence" (Lemberger v Khan, 18 AD3d 447, 794 NYS2d 416 [2d Dept 2005]). The due diligence requirement of CPLR §308(4) must be strictly observed, given the reduced likelihood that a summons served pursuant to that section will be received (McSorley v Spear, 50 AD3d 6152,854NYS2d 759 [2d Dept 2008]; Estate of Waterman v Jones, 46 AD3d 63, 843 NYS2d 462 [2d Dept 2007]; O'Connell v Post, 27 AD3d 630, 811 NYS2d 441 [2d Dept 2006]; Scott v Knoblock, 204 AD2d 299, 611 NYS2d 265 [2d Dept 1994]; Kaszovitz v Weiszman, 110 AD2d 117, 493 NYS2d 335 [2d Dept 1985]).
  
  What constitutes due diligence is determined on a case-by-case basis, focusing not on the quantity of the attempts at personal delivery, but on their quality (McSorley v Spear, supra; Estate of Waterman v Jones, supra). Attempting to serve a defendant at his or her residence without showing that there was a genuine inquiry about the defendant's whereabouts and place of employment is fatal to a finding of due diligence as required by CPLR §308(4) (Id.; see also, Sanders v Elie, 29 AD3d 773, 816 NYS2d 509 [2d Dept 2006]). Further, absent any evidence that the process server attempted to determine that the address where service was attempted was, in fact, the actual dwelling or usual place of abode of the defendant(s), such as by searching telephone listings or making inquiries of neighbors, the requirement of CPLR §308(4), that service under CPLR §308(1) and (2) first be attempted with "due diligence," is not met (Kurlander v A Big Stam. Corp., 267 AD2d 209, 699 NYS2d 453 [2d Dept 1999]).
  
  Since the plaintiff has failed to meet the ''due diligence" requirement for "nail and mail" service under CPLR §308(4), jurisdiction over the defendant has not been established and the plaintiffs motion must be denied (Sanders v Elie, supra; Earle v Valente, 302 AD2d 353, 754 NYS2d 364 [2d Dept 2003]; Annis v Long, 298 AD2d 340,751 NYS2d 370 [2d Dept 2002]) Earle v Valente, supra; Annis v Long, supra).

For other examples of process server screw-ups involving a failure to exercise due diligence to locate defendants in foreclosure actions or ascertain the identity of all occupants of premises under foreclosure, see:

• Lack Of Diligence Means Another Process Server Screw-Up, Another Void Foreclosure (improper use of service by publication);
• NY Court Denies Tenant Eviction After Foreclosure Sale; Failure To Name, Serve All Occupants As Parties In Foreclosure Action Fatal To Removal Attempt (failure to serve all occupants, including 12 year old child);
• Failure To Name Tenant In Home Foreclosure Action Thwarts Subsequent Eviction Attempt; Use Of "John Doe" Alias Ruled Ineffective Absent Due Diligence (improperly identifying unknown tenant as "John Doe" without first establishing that a genuine effort was made to ascertain the name of the party but has been unable to do so).