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Gutz v. Johnson8/9/2005
Stanley Johnson and the marital community appeal the trial court's denial of their motion to vacate a default order and judgment in favor of Desiree and Sharon Gutz for injuries allegedly caused by an automobile collision. The Johnsons argue that: (1) their insurance company's extensive communications with Sharon Gutz and the Gutzes' counsel constituted an informal appearance under CR 55(a)(3) that entitled them to notice of the default order; and (2) the trial court erred in denying their motion to vacate the default judgment because they satisfied the four elements of relief under CR 60(b). The Gutzes argue that the majority of the Johnsons' assignments of error are not properly preserved for appellate review. We vacate, reverse, and remand the case for trial.
FACTS
A. Automobile Accident and Pre-lawsuit Communications
In October 2000, Sharon Gutz, and her minor daughter, Desiree Gutz, were in an automobile accident with Stanley Johnson. The accident occurred at a stop sign at the intersection of Military Road and State Route 161 in Federal Way, Washington. Sharon was turning left onto Military Road and Johnson was turning left to State Route 161. Their cars collided. Johnson maintains that the cars were moving slowly and Sharon asserts that her car was totaled. Johnson also asserts that Sharon told him at the scene of the accident that she had prior neck problems.
Immediately after the car accident, Sharon went to the hospital and was examined for neck and back pain. The results came back normal but she received massage therapy for approximately six months. Desiree was diagnosed for possible whiplash but she received no medical treatment until she obtained physical and massage therapy two years after the accident.
Johnson's insurer was the Allstate Insurance Company. The Gutzes filed a damages claim with Allstate soon after the car accident with Johnson. In January 2001, Allstate wrote Sharon to discuss her and Desiree's claims. Ten months later in October 2001, Allstate left a phone message with Sharon to obtain more information about her claims. Then in September 2002, Allstate wrote a letter to Sharon indicating that they tried to reach her at work and advised her that she needed to provide additional medical records to fully evaluate her claims, particularly regarding wage loss issues.
In November 2002, the Gutzes' counsel sent a letter informing Allstate that he was representing Sharon and Desiree for injuries sustained in the car accident with Johnson. The Gutzes' counsel requested medical and other information from Allstate to enable his office to evaluate the matter and for 'verification of coverage for your insured {Johnson} at this time.' Clerk's Papers (CP) at 255.
In February 2003, the Allstate claims adjuster discussed 'the claims and the status of treatment for the two claimants' with a paralegal of the Gutzes' counsel's office. CP at 245. The claims adjuster also sent a letter to the Gutzes' counsel acknowledging his representation of the Gutzes. Allstate's claims adjuster requested that the Gutzes' counsel's office forward any medical bills and reports, emphasized that they needed written documentation for a wage loss claim, and stated that, 'I am hopeful that, through our joint efforts, we will be able to bring this matter to a prompt resolution, and I look forward to working with you towards that goal.' CP at 259.
In May 2003, Allstate requested a settlement demand letter from the Gutzes' counsel. Three months later in late August 2003, the Gutzes' counsel sent a settlement demand letter on Sharon's behalf only. The demand letter stated that the statute of limitations on Sharon's
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