
USCA1 Opinion

	




                                 ____________________                                 ____________________        No. 90-1798        No. 90-1798                         PRECISION ETCHINGS & FINDINGS, INC.,                         PRECISION ETCHINGS & FINDINGS, INC.,                                 Plaintiff, Appellee,                                 Plaintiff, Appellee,                                          v.                                          v.                                    LGP GEM, LTD.,                                    LGP GEM, LTD.,                                 Defendant, Appellee,                                 Defendant, Appellee,                                                                                                                                    ______                                  MAURICE C. FEIGER,                                  MAURICE C. FEIGER,                                Defendant, Appellant.                                Defendant, Appellant.                                 ____________________                                 ____________________        No. 91-1277        No. 91-1277                         PRECISION ETCHINGS & FINDINGS, INC.,                         PRECISION ETCHINGS & FINDINGS, INC.,                                 Plaintiff, Appellee,                                 Plaintiff, Appellee,                                          v.                                          v.                                    LGP GEM, LTD.,                                    LGP GEM, LTD.,                                 Defendant, Appellee,                                 Defendant, Appellee,                                                                                                                                    ______                                  MAURICE C. FEIGER,                                  MAURICE C. FEIGER,                                Defendant, Appellant.                                Defendant, Appellant.                                 ____________________                                 ____________________                    APPEALS FROM THE UNITED STATES DISTRICT COURT                    APPEALS FROM THE UNITED STATES DISTRICT COURT                           FOR THE DISTRICT OF RHODE ISLAND                           FOR THE DISTRICT OF RHODE ISLAND                [Hon. Raymond J. Pettine, Senior U.S. District Judge]                [Hon. Raymond J. Pettine, Senior U.S. District Judge]                                          __________________________                                 ____________________                                 ____________________                                        Before                                        Before                              Torruella, Circuit Judge,                              Torruella, Circuit Judge,                                         _____________                           Timbers, Senior Circuit Judge,*                           Timbers, Senior Circuit Judge,*                                    ____________________                               and Cyr, Circuit Judge.                                and Cyr, Circuit Judge.                                         _____________                                 ____________________                                 ____________________            Harold E. Krause for appellant, third-party defendant.            Harold E. Krause for appellant, third-party defendant.            ________________            Richard D. Boriskin with whom Markoff & Boriskin was on brief  for            Richard D. Boriskin with whom Markoff & Boriskin was on brief  for            ___________________           __________________        appellee, third-party plaintiff.        appellee, third-party plaintiff.                                 ____________________                                 ____________________                                 ____________________                                 ____________________        *Of the Second Circuit, sitting by designation.        *Of the Second Circuit, sitting by designation.            CYR,  Circuit Judge.    This appeal  concerns  the validity  of  a            CYR,  Circuit Judge.                  _____________        default  judgment  entered  by the  district  court  notwithstanding a        defect in the service of process which allegedly deprived the court of        personal jurisdiction  over the defendant-appellant.   Precision Etch-        ings & Findings, Inc. brought the  present action in the United States        District Court for the District of Rhode Island against LGP  Gem, Ltd.        ("LGP").  LGP filed  a third party complaint against  defendant-appel-        lant  Maurice Feiger.   The  third  party complaint  and summons  were        addressed to Feiger by certified  mail, return receipt requested, at a        Brooklyn,  New York,  street address,  rather than  to the  particular        apartment in which Feiger resided.   The return receipt indicates that        service was  made upon an  occupant of another  apartment in the  same        apartment building.  Default was entered against Feiger in April 1990,        after he failed to answer LGP's complaint.            On  June 4,  1990, Feiger's  New York  counsel  filed a  motion to        vacate  the default,  alleging insufficient  service of process.   Al-        though New York counsel attempted to appear in behalf of Feiger before        the  United States  Magistrate Judge  at the  June 4 hearing  on LGP's        claim for damages,  he was not permitted  to do so because  Feiger had        not  retained local  counsel as  required by  Rhode Island  Local Rule        5(b).   Without addressing Feiger's  motion to set aside  the default,        the magistrate  judge made proposed  findings of fact  and recommended        the  entry of a default  judgment against Feiger.   The district court        adopted the proposed findings and  the disposition recommended by  the                                          3        magistrate judge.  Neither the magistrate judge nor the district court        addressed Feiger's  June 4  motion to  set  aside the  default on  the        ground of insufficient service of process.            On July  26, 1990, Feiger  moved to vacate  the default  judgment,        once again on the ground that  he had never been properly served  with        process.  Following a hearing, the motion  to vacate was denied by the        magistrate judge on the ground  that Feiger "had sufficient and timely        knowledge of  the Third  Party Complaint filed  against him."   Feiger        promptly  filed  objections  to  the  magistrate  judge's  recommended        findings and  disposition submitted by  the magistrate judge.   See 28                                                                        ___        U.S.C.   636(b) (1)(B).            The district  court determined  that Feiger  had actual  notice of        the third  party complaint, notwithstanding  the fact that  the return        receipt evidencing  service of the  summons and third  party complaint        appeared to  have been signed  by an occupant of  another apartment in        the three-apartment building where Feiger resided.  The district court        accepted the magistrate  judge's recommendation and denied  the motion        to vacate  the default judgment,  apparently on the basis  that actual        notice  provided  a sufficient  basis  for  the  exercise of  personal        jurisdiction over Feiger.*  Finally, the district court denied Feiger-        's postjudgment  motion to set  aside the default judgment  and Feiger        appealed.                                      ____________________        *Neither the  magistrate judge  nor the  district court  discussed the        *Neither the  magistrate judge  nor the  district court  discussed the        legal requirements of service of process.        legal requirements of service of process.                                          4            A default judgment  entered by  a court  which lacks  jurisdiction        over  the person  of  the  defendant is  void,  General Contracting  &                                                        ______________________        Trading Co. v. Interpole,  Inc., 940 F.2d 20, 21 n.1  (1st Cir. 1991),        ___________    ________________        and may be set aside at any time pursuant to Fed. R. Civ. P. 60(b)(4).                             __ ___ ____        See generally  11 C. Wright & A. Miller, Federal Practice & Procedure,        ___ _________                            ____________________________          2862 (1973).  Personal  jurisdiction is established either by proper        service of process, see, e.g., Jardines Bacata,  Ltd. v. Diaz-Marquez,                            ___  ____  ______________________    ____________        878 F.2d 1555,  1559 (1st Cir. 1989)  ("[i]n the ordinary  course, the        district court acquires jurisdiction over a  defendant only by service        of process"),  or  by the  defendant's  waiver of  any  defect in  the        service of process, see, e.g.,  General Contracting & Trading Co., 940                            ___  ____   _________________________________        F.2d  at 22  (personal  jurisdiction  may be  acquired  by consent  or        implied from conduct).            LGP elected to attempt service of process upon Feiger pursuant  to        Fed. R. Civ. P.  4(c)(2)(c), in accordance with "the law  of the State        in which  the district  court is held."   In  this case,  Rhode Island        District Court Rule of Civil Procedure 4(d)(1), which is based on Fed.        R. Civ. P.  4(d)(1), see Plushner  v. Mills, 429  A.2d 444, 445  (R.I.                             ___ ________     _____        1981), required service:            [u]pon  an individual  other than  an  incompetent person  by            delivering a copy of the summons and complaint to him person-                                                                  _______            ally or  by leaving copies  thereof at his dwelling  house or            ____ __                             __ ___ ________  _____ __            usual place  of abode  with some person  of suitable  age and            _____ _____  __ _____  ____ ____ ______  __ ________  ___ ___            discretion then residing therein . . .            __________ ____ ________ _______        Dist. R. Civ. P. 4(d)(1) (emphasis added).                                          5            The Rhode Island service  of process requirements were not met  in        the instant case  since the return receipt indicates  that the summons        and complaint were  neither delivered to  Feiger "personally" nor  "at        his dwelling  house or usual  place of abode."   Id.  Instead,  as the                                                         __        district court noted, the return  receipt indicates, at best, that the        summons and  complaint were  delivered to an  occupant of  a different        apartment at  the  same street  address  where Feiger's  apartment  is        located.  LGP  contends, nonetheless, that actual notice  of the third        party  action was  sufficient under  Rhode Island  law to  support the        district court's exercise  of personal jurisdiction over Feiger.   The        precise  issue presented  appears not  to have  been addressed  by the        Rhode Island courts.              The Supreme  Court of Rhode Island  has "emphasized the  principle        that legislative enactments  relating to service of process  are to be        followed and construed  strictly, since jurisdiction of the court over        the person  of the defendant  is dependent upon proper  service having        been  made."   Plushner, 429  A.2d  at 445-446,  quoting Barthlein  v.                       ________                                  _________        Ellis,  314 A.2d  426, 427 (R.I.  1974).   "In construing  [service of        _____        process] rules  it has  been [the Rhode  Island] practice to  look for        guidance in  the precedents  of the federal  courts, upon  whose rules        those  of the [Rhode  Island courts] are  closely patterned."   Id. at                                                                        ___        446, quoting Nocera v. Lembo, 298 A.2d 800, 803 (R.I. 1973).  When the                     ______    _____        defendant has received  actual notice of the action,  the Rhode Island        courts, in conformity  with the federal practice, have determined that        service of process requirements are  to be "broadly interpreted,"  id.                                                                           ___                                          6        (citing  federal cases),  provided the  interpretation  is "a  natural        rather than an artificial one. . . ."  Id. quoting Blackhawk Heating &                                               ___         ___________________        Plumbing Co. v. Turner, 50 F.R.D. 144, 145 (D. Ariz. 1970).        ____________    ______            Neither federal precedent nor Rhode  Island caselaw supports LGP's        contention that  actual notice of the  filing of the  third party com-        plaint was sufficient to confer personal jurisdiction in these circum-        stances.  The federal courts have made it abundantly clear that actual        notice itself, without more,  is insufficient to satisfy the  require-        ments of Fed. R.  Civ. P. 4(d)(1).  See, e.g.,  Echevarria-Gonzalez v.                                            ___  ____   ___________________        Gonzalez-Chapel, 849 F.2d 24, 28 (1st Cir. 1988) ("[a]ctual notice and        _______________        simply  naming the person in the caption  of the complaint is insuffi-        cient  to subject  a defendant  to  the jurisdiction  of the  district        court"); see  also Mid-Continent  Wood Products,  Inc. v.  Harris, 936                 ___  ____ ___________________________________     ______        F.2d 297, 301 (7th Cir. 1991) (citing cases).  Although "minor" formal                                                                        ______        defects  are excusable provided  actual notice has  been accomplished,        see, e.g.,  Sanderford v. Prudential Ins. Co., 902 F.2d 897, 899 (11th        ___  ____   __________    ___________________        Cir. 1990) (district court not deprived of in personam jurisdiction by                                                   __ ________        failure to include return date  for responsive pleading in duly served                                                                   ____ ______        summons),  the rule nevertheless must be accorded at least substantial        compliance, see, e.g., Daly-Murphy v.  Winston, 837 F.2d 348, 355 (9th                    ___  ____  ___________     _______        Cir. 1987)  (requiring  "substantial compliance"  with rule  4(d)(1));        Zuckerman v. McCulley,  7 F.R.D. 739, 741  (E. D. Mo. 1947)  ("[a]s we        _________    ________        read  the cases,  substantial compliance  with  the Rules  prescribing        manner  of service is required")  (emphasis added) (service on janitor        ______  __ _______        of  building in which  defendant resided not  substantial compliance).                                          7        It  has been held  directly that  delivery of  process to  a different        apartment in the same building is  not sufficient service.  Di Leo  v.                                                                    ______        Shin Shu, 30 F.R.D. 56 (S.D.N.Y.  1961) (service on daughter of defen-        ________        dant who resided in separate apartment not sufficient).            Neither  the cases  cited  by LGP,  nor  any we  have  discovered,        indicate that  actual notice would suffice  to cure the defect  in the        manner of service effected on Feiger.  In Plushner v. Mills,  429 A.2d                                                  ________    _____        at  446, the  Rhode Island  Supreme Court  found that  "actual notice"        constituted  substantial  compliance  where  service  of  process  was        effected  by delivery  to defendant's  daughter while  she was  at the                                                                        __ ___        defendant's  residence, even though the daughter maintained a separate        ___________  _________        residence at the time.  The court  noted that the daughter possessed a        key to the defendant's residence and had been placed in charge  of the        dwelling during her father's absence.  Id.  Since the court found that                                               ___        the  daughter, therefore, was a  "trusted member of defendant's house-                                                  ______ __ ___________ ______        hold and that a substantial  nexus existed between her and  the defen-        ____        dant,"  it decided  that  she  "could be  considered  to be  'residing        therein' under  a broad  interpretation of Rule  4(d)(1), and  such an        interpretation is allowed when defendant receives actual notice."  Id.                                                                           ___        (emphasis added).  The undeveloped record in  the instant case, on the        other  hand, simply cannot support a similarly "broad interpretation,"        since no evidence was  presented that the person  to whom process  was                                          8        delivered  was a  member of  Feiger's  household, his  landlord, or  a        person having any "substantial connection" with him.**            Federal precedent and Rhode  Island caselaw indicate only that the        specific rules  governing the precise  manner of effecting  service of        process are to be given  "broad interpretation" when the defendant has        received  "actual notice."  Neither  source of authority suggests that        "actual  notice" itself suffices,  absent substantial  compliance with        the manner of service prescribed by rule.  The present record does not        enable a determination that there was substantial compliance with rule        4(d)(1).  Therefore, unless Feiger waived any defect in the service of        process, the case must be  remanded for further factfinding bearing on        the issue of substantial compliance.            Unlike the absence of subject matter jurisdiction, the defense  of        lack of  personal jurisdiction may  be waived  by express  submission,                                    ____________________        **Moreover,  the Plushner  court relied  in  part on  a federal  case,        **Moreover,  the Plushner  court relied  in  part on  a federal  case,                         ________        Nowell v. Nowell, 384 F.2d 951 (5th Cir. 1967), cert. denied, 390 U.S.        Nowell v. Nowell, 384 F.2d 951 (5th Cir. 1967), cert. denied, 390 U.S.        ______    ______                                ____  ______        956 (1968),  which held that the  federal service of process  rule was        956 (1968),  which held that the  federal service of process  rule was        satisfied by service  upon the defendant's landlady, due  to the "sub-        satisfied by service  upon the defendant's landlady, due  to the "sub-        stantial nexus" between  landlord and tenant.  In  Plushner, the Rhode        stantial nexus" between  landlord and tenant.  In  Plushner, the Rhode                                                           ________        Island  Supreme Court  explicitly  called attention  to the  fact that        Island  Supreme Court  explicitly  called attention  to the  fact that        Nowell had distinguished  between service upon the landlord  and "ser-        Nowell had distinguished  between service upon the landlord  and "ser-        ______        vice upon a  neighboring tenant . . . [because]  the substantial nexus        vice upon a  neighboring tenant . . . [because]  the substantial nexus        that exists between tenant and landlord does not exist between tenants        that exists between tenant and landlord does not exist between tenants        themselves."   Plushner, 429 A.2d at  446, quoting Nowell, 384 F.2d at        themselves."   Plushner, 429 A.2d at  446, quoting Nowell, 384 F.2d at                       ________                            ______        953.        953.            Similarly, Lavey v. Lavey, 551 A.2d 692 (R.I. 1988), another  case            Similarly, Lavey v. Lavey, 551 A.2d 692 (R.I. 1988), another  case                       _____    _____        in which the  defendant was found to  have had "actual notice"  of the        in which the  defendant was found to  have had "actual notice"  of the        lawsuit,  provides no  support for  LGP's position.   The  Lavey court        lawsuit,  provides no  support for  LGP's position.   The  Lavey court                                                                   _____        found  that a residence,  at which the defendant  had dinner daily and        found  that a residence,  at which the defendant  had dinner daily and        occasionally showered, watched television and picked up mail, could be        occasionally showered, watched television and picked up mail, could be        included within  a broad interpretation  of "dwelling house  or . .  .        included within  a broad interpretation  of "dwelling house  or . .  .        usual place of abode. . .  ."  Id. at 694-695.  The  present record is        usual place of abode. . .  ."  Id. at 694-695.  The  present record is                                       ___        insufficiently developed to support such a finding.        insufficiently developed to support such a finding.                                          9        conduct, or failure to assert the defense.  See Neirbo Co.  v. Bethle-                                                    ___ __________     _______        hem Shipbuilding Corp., 308 U.S.  165, 168 (1939); General Contracting        ______________________                             ___________________        & Trading Co.,  940 F.2d at 22; Marcial Ucin, S.A.  v. SS Galicia, 723        _____________                   __________________     __________        F.2d 994,  996 (1st Cir.  1983).  As  Feiger assiduously  attempted to        assert the defense before the district court, we find no waiver.              Feiger first  raised the defense  by motion on  June 4, 1990,  the        day  of the  scheduled hearing  on  LGP's claim  for damages,  thereby        precluding waiver under Fed. R. Civ. P. 12(h)(1).  See Roque v. United                                                           ___ _____    ______        States, 857 F.2d 20,  21 (1st Cir. 1988);  Glater v. Eli Lilly  & Co.,        ______                                     ______    ________________        712  F.2d 735, 738 (1st  Cir. 1983).  At  no time did Feiger expressly        submit  to the exercise of jurisdiction by  the district court.  More-        over, Feiger's conduct did not constitute participation in, or encour-        agement of, the district  court proceedings so as to  amount to waiver        by conduct.   See United States use of Combustion  Systems Sales, Inc.                      ___ ____________________________________________________        v. Eastern  Metal Products  & Fabricators, Inc.,  112 F.R.D.  685, 687           ____________________________________________        (M.D.N.C. 1986)  (collecting cases  and concluding  that though  cases        present "markedly different situations, [they] have the common factors        of  dilatoriness and participation  in, or encouragement  of, judicial        proceedings"); see also General Contracting & Trading Co., 940 F.2d at                       ___ ____ _________________________________        22  (collecting cases).    Feiger  did not  participate  in any  hear-        ing,***  see,  e.g., Wyrough  &  Loser, Inc.  v.  Pelmor Laboratories,                 ___   ____  _______________________      ____________________                                    ____________________        ***Feiger's unsuccessful attempt to participate in  the June 4 hearing        ***Feiger's unsuccessful attempt to participate in  the June 4 hearing        on LGP's claim  for damages was not  a waiver, since New  York counsel        on LGP's claim  for damages was not  a waiver, since New  York counsel        stated explicitly  that he  intended to challenge  the sufficiency  of        stated explicitly  that he  intended to challenge  the sufficiency  of        service of  process at the hearing.  See Marcial Ucin, 723 F.2d at 997        service of  process at the hearing.  See Marcial Ucin, 723 F.2d at 997                                             ___ ____________        ("general appearance  by a defendant  does not constitute a  waiver of        ("general appearance  by a defendant  does not constitute a  waiver of        the defense of lack of jurisdiction over the person").        the defense of lack of jurisdiction over the person").                                          10        Inc., 376 F.2d 543, 547 (3d Cir. 1967) (finding waiver where defendant        ____        attended  preliminary injunction  hearing),  seek affirmative  relief,        see,  e.g., General  Contracting  &  Trading Co.,  940  F.2d at  23-24        ___   ____  ____________________________________        (bringing  independent action arising  out of same  transactional core        constitutes implied submission),  or lend an appearance  of submission        through extended  inaction, see, e.g.,  Marcial Ucin, 723 F.2d  at 997                                    ___  ____   ____________        (waiver found after defendant filed appearance,  attended depositions,        and waited four years before raising defense).            Feiger justly cannot be deemed to have submitted to the  jurisdic-        tion  of the  district court  by filing  objections to  the magistrate        judge's  proposed findings and recommended disposition as was required        by 28 U.S.C.   636(b)(1)  and Fed. R. Civ. P.  72(b) in order to  pre-        serve his right to de novo review of the recommended disposition.  The                           __ ____        magistrate judge  did not address  Feiger's specific challenge  to the        sufficiency of service of process, nor determine the manner of service        sufficient under  Rhode Island  law.  Thus,  Feiger surely  would have        been found to have waived the right to de novo  review by the district                                               __ ____        court had he  not objected to the recommended  disposition as required        by  section 636(b)(1) and  rule 72(b).   See Park Motor  Mart, Inc. v.                                                 ___ ______________________        Ford Motor Co., 616 F.2d 603 (1st Cir. 1980).  In these circumstances,        ______________        Feiger's objections impliedly reaffirmed his consistent  opposition to        the  district court's  exercise of  personal  jurisdiction before  the                                          11        magistrate judge.****   It would  represent a distortion of  the waiv-        er doctrine to  construe Feiger's objections to  the proposed findings        and  recommended disposition  as  a  waiver of  the  right to  contest        personal jurisdiction, especially since  Feiger vigorously pursued the        service of process  issue before the magistrate judge  from the outset        and the magistrate  judge made no specific finding that  the manner of        service effected  on Feiger  was sufficient.   Rather, by  raising the        service of process issue in the June 4 and July 26  motions filed with        the  magistrate judge  and again  in  his postjudgment  motion to  the        district  court  under  rule 60(b)(4),  Feiger  promptly,  plainly and        consistently  preserved his  personal  jurisdiction  defense based  on        defective service of process.            The default  judgment is vacated and  the case is  remanded to the            __________________________________________________________________        district court for  further proceedings consistent with  this opinion;        ______________________________________________________________________        costs to appellant.          __________________                                    ____________________        ****When  Feiger filed objections  to the magistrate  judge's proposed        ****When  Feiger filed objections  to the magistrate  judge's proposed        findings and recommended  disposition, he requested that  the district        findings and recommended  disposition, he requested that  the district        court "conduct a new hearing  with all parties present and represented        court "conduct a new hearing  with all parties present and represented        so that the facts in  this very complicated commercial transaction can        so that the facts in  this very complicated commercial transaction can        be brought before the Court and an appropriate decision made."  In the        be brought before the Court and an appropriate decision made."  In the        circumstances  of the  present case,  Feiger's statement did  not "un-        circumstances  of the  present case,  Feiger's statement did  not "un-        equivocally  show  an intention  to  submit  to the  district  court's        equivocally  show  an intention  to  submit  to the  district  court's        jurisdiction."   Jardines Bacata,  Ltd., 878 F.2d  at 1559  (waiver of        jurisdiction."   Jardines Bacata,  Ltd., 878 F.2d  at 1559  (waiver of                         ______________________        right to challenge personal jurisdiction may be found only if there is        right to challenge personal jurisdiction may be found only if there is        no other  reasonable explanation of  the conduct).  On  June 4, Feiger        no other  reasonable explanation of  the conduct).  On  June 4, Feiger        had challenged the  sufficiency of service  of process; he  reasserted        had challenged the  sufficiency of service  of process; he  reasserted        the same defense on  July 26.  There was no  unequivocal showing of an        the same defense on  July 26.  There was no  unequivocal showing of an        intention to submit to the jurisdiction of the district court.        intention to submit to the jurisdiction of the district court.                                          12
