Judge Affirms $500,000 Verdict for Alvarez Client

Malfunctioning Shopping Cart Leads To $500,000 Default Judgment In Menards Lawsuit

Alvarez Law Office recently won a default judgment of a half million dollars — one of the largest default judgments in Lake County’s history — on behalf of an injured shopper when Menard, Inc. failed to defend against this shopper’s tort claim. The Indiana Court of Appeals affirmed the trial court’s grant of default judgment in favor of Reba Lane, who was injured by a malfunctioning shopping cart while shopping at a Menards store in Gary.

This $500,000 monetary judgment was assessed against Menards despite its claim that it was never provided with notice of the initial complaint or an opportunity to defend itself. Read on to learn more about this impressive accomplishment on behalf of Ms. Lane and what can happen when a civil case is decided by default.

 

What Notice Is Required?

Indiana’s Rules of Trial Procedure set out the notice and service of process required in civil matters. Constitutional due process considerations require the trial court to obtain jurisdiction over all parties before it can rule on a matter, and jurisdiction fails if one or more defendants is not made aware of the lawsuit and provided with an opportunity to respond.

However, strict adherence to this rule would mean that defendants could avoid ever being subject to civil liability simply by changing residences or refusing personal service of a complaint. As a result, the Trial Rules allow a plaintiff to proceed to judgment as long as he or she has made a reasonable effort at service.

If the defendant can’t be personally located for service and it’s unclear whether he or she is receiving mail, service can instead be accomplished by publishing notice of the lawsuit for a few weeks in several regional newspapers.

If adequate service is attempted, the defendant fails to appear for court proceedings, and the plaintiff provides enough evidence to sustain a judgment in his or her favor, the court may enter a default judgment against the defendant, whose assets may then be garnished to satisfy this judgment.

In Menard v. Lane, Ms. Lane first attempted to serve the defendant by sending a summons to Menard’s agent registered with the Secretary of State. This corporation replied with a letter indicating that its services on Menard’s behalf had been discontinued and it had no forwarding address on file.

Ms. Lane then enlisted a sergeant with the local sheriff’s department to serve the summons, addressed to the “highest executive officer found on premises,” at a local Menards store. Another copy of this summons was mailed to the store’s address via certified mail, and a return receipt was provided.

Several months later, after the deadline for Menards to respond to the complaint had long passed, Ms. Lane filed a motion for default judgment. After a hearing at which evidence of the injuries was presented, the trial court awarded Ms. Lane $500,000 in monetary damages.

What Happens After Default Judgment?

After a default judgment is entered, the prevailing party must then enforce the judgment through a process known as “proceedings supplemental.” This allows the prevailing party to seek information on the judgment debtor’s assets so that any available assets can be seized or garnished until the judgment is satisfied.

Two months after her $500,000 default judgment was entered against Menards, Ms. Lane filed a motion to enforce the judgment. After receiving a copy of Ms. Lane’s motion, Menards’ attorney entered an appearance and immediately moved to set aside the default judgment. When this motion was denied, Menards appealed the trial court’s entry of default judgment to the Indiana Court of Appeals.

The Court of Appeals affirmed the judgment in Ms. Lane’s favor, holding that she had followed all necessary due process requirements, including those listed within Trial Rule 4(B), in attempting to sue an organization doing business within Indiana.

Although Menards argued that its employees were not trained on how to handle service of process situations, which led notice of this particular lawsuit to fall between the cracks, this failure was not attributable to anything Ms. Lane did and therefore was not enough to prevent the entry of default judgment in her favor.

Though Menards petitioned the Court of Appeals for rehearing on this issue, the Court of Appeals reaffirmed its prior opinion that Ms. Lane was entitled to default judgment of the full $500,000 initially awarded.

This high-value default judgment sets an important precedent, putting employers and large companies on notice that merely responding “I didn’t know there was a lawsuit” won’t be enough to insulate them from significant liability in personal injury cases. This result can also ensure that justice is achieved for victims even when the defendant seems to be ignoring any and all notice that a complaint has been filed.