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Unpublished Opinion No.  2011-UP-184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."