Appeal from Superior Court, Maricopa County; Harold R. Scoville, Judge.
Wm. B. Lufty, of Phoenix, for appellant.
George M. Sterling, of Phoenix, for appellee.
Stanford, Chief Justice. LaPrade and Udall, JJ., concurring.
Stanford, Chief Justice.
On July 12, 1944, appellee, hereinafter styled defendant, gave his promissory note [65 Ariz. 154] to one Ben Johnson for the sum of $ 1025.50, payable in installments, the first payment of $ 85.45 to become due October 1, 1944. On August 1, 1944, Ben Johnson assigned the note without recourse to John H. Painter, appellant and plaintiff herein. After the payment of November 1st was past due, and on November 6, 1944, plaintiff declared the whole amount due, and on November 28, 1944, filed his complaint in the Superior Court.
Service was made on the defendant in Maricopa County on the 29th day of November, 1944. Default was taken against the defendant before the clerk of the Superior Court of Maricopa County on January 12, 1945. Thereafter on January 16, 1945, defendant filed in said court his motion to set aside default. The motion to set aside default was supported by an affidavit made by George M. Sterling, attorney, the affidavit setting forth that plaintiff was not a holder of the note in good faith, but that he was a servant and agent of Ben Johnson, the payee in the note, and was such at the date he purchased the said note and had knowledge that the chattel mortgage was obtained from this defendant by fraud. The affidavit further stated that defendant herein had filed in the Superior Court of Maricopa County his motion for security for costs. We find on inspection that the motion for security for costs was filed on December 14, 1944, and a filing fee of $ 5 was paid. Defendant's answer was filed January 17, 1945.
No judgment was rendered on default entered by the clerk.
After default was granted by the clerk, defendant moved to set it aside. On January 29, 1945 the court denied defendant's motion to set aside the default. On February 12, 1945, however, the court vacated the order denying defendant's motion to set aside default. Defendant's answer set forth that: "The plaintiff herein was the agent, servant and employee of said Ben Johnson, and that the plaintiff herein had knowledge of the transaction wherein and whereby said note and chattel mortgage were made and executed; that the plaintiff herein at the time of the assignment of said note and chattel mortgage knew, or by the use of reasonable care could have ascertained that said note and chattel mortgage were illegal and null and void, in that it appears from said note and chattel mortgage that the ceiling prices as established by the Office of Price Administration had been exceeded and by the terms of said law were null and void; that at the time of said assignment of said note
and Chattel Mortgage to the plaintiff herein and prior thereto the plaintiff knew or by the use of ordinary and reasonable care could have known that said note and Chattel Mortgage were obtained from the defendant herein by fraud and that said note and Chattel Mortgage were obtained by the said Ben Johnson by deceit."
The case was tried before the court without a jury and judgment was rendered on [65 Ariz. 155] behalf of defendant. From such judgment the plaintiff appealed and assigned two errors as follows:
"1. The court erred in setting aside the default of defendant; the defendant did not show a legal excuse for not having answered or appeared, and did not submit his answer showing ...