Is It a Double-Edged Sword? A Common Pitfall of Defaults
It is common knowledge that litigation, if anything, is three things: timely, costly, and tiring. No matter the mental preparation every attorney holds with their respective clients, the feeling of desperation and the desire for closure begins to sink in as litigation begins and drags on. Now imagine filing a complaint, having your summons issued, serving the defendant, and waiting those twenty days, just to receive no response; then informing your client you can now request a default and seek a default final judgement. The light at the end of the tunnel begins to appear and the relief begins to set in. Well, up to the point of receiving email service of a motion to vacate or set aside a default, at which point the blood begins to boil and the client then asks, “They are too late; there is no way they can reverse everything can they?” This is an all-too-familiar feeling and question for most attorneys practicing any volume of practice.
In Florida, a party seeking to vacate a default final judgment must demonstrate three key elements: (1) the failure to file a responsive pleading resulted from excusable neglect; (2) the party has a meritorious defense; and (3) the party acted with due diligence in seeking relief upon learning of the final judgment. Chetu, Inc. v. Franklin First Fin., Ltd., 276 So. 3d 39 (Fla. 4th DCA 2019), Fernandez v. Difiore, 279 So. 3d 174 (Fla. 4th DCA 2019).
On motion and upon such terms as are just, the court may set aside a dismissal and relieve a party, or a party’s legal representative, from a final judgment, decree, order, or proceeding for mistake, inadvertence, surprise, or excusable neglect. See Fla. R. Civ. Pro. § 1.540 (b). The concept of excusable neglect requires more than a mere conclusory statement; the party moving to vacate a default judgment must set forth facts explaining or justifying the mistake or inadvertence by affidavit or other sworn statement. Inter-Atlantic Ins. Servs. v. Hernandez, 632 So. 2d 1069 (Fla. 3d DCA 1994). However, Florida courts have held that “excusable neglect is found where inaction results from clerical or secretarial error, reasonable misunderstanding, a system gone awry or any other of the foibles to which human nature is heir.” Wilson v. Woodward, 602 So.2d 547, 548-49 (Fla. 2d DCA 1992). “In general, “excusable neglect ‘contemplate[s] that the courts would be permitted, where appropriate, to accept late filings caused by inadvertence, mistake, or carelessness, as well as by intervening circumstances beyond the party’s control.'” Madill v. Rivercrest Cmty. Ass’n, 273. So. 3d 1157, 1160 (Fla. 2d DCA 2019).
There is a wide array of occurrences that could be considered excusable neglect, and the courts have a wide range of discretion to determine this. In the Madill v. Rivercrest case, the attorney listed as counsel of record was sent an email from the judicial assistant concerning the entry of a final judgment against his client. The attorney was under the impression that it had a granted extension of time when it did not, and did not respond to the motion or entry of final judgment. An attorney at the firm had actually received an email from the judge’s judicial assistant with a copy of the final judgment attached to the email. The court in Madill exclaimed, “There’s no question that the attorney’s oversight was the result of careless human error. But absent something more, that’s exactly what excusable neglect is.”
The meritorious defense refers to the party’s denial of negligence or any other valid defense that creates an issue of fact. North Shore Hospital, Inc. v. Barber, 143 So. 2d 849 (Fla. 1962). This is an important aspect of the default process, as it enforces the public policy of results. If the same result would have occurred whether or not you responded, then the courts have no reason to set anything aside. Due diligence refers to the party’s prompt action in seeking relief upon learning of the default judgment. Similarly, in the Madill case, the attorney worked promptly to resolve the confusion when he realized there was a final judgment entered.
The trial court’s decision on a motion to vacate a default judgment is reviewed for a gross abuse of discretion. A higher standard is applied where the default is vacated than where the court denies the motion to vacate, but there is a strong preference for lawsuits to be determined on their merits, and courts should liberally set aside defaults under appropriate circumstances. Net One, LLC v. Christian Telecom Network, LLC, 901 So. 2d 417 (Fla. 5th DCA 2005). To hear a case on its merits is possibly the most important concept in the default process, as public policy reigns that, when at all possible, a case should be heard on its merits. In other words, when the opportunity arises, a judge should always consider allowing a case to be heard and settled with arguments and contentions to find a final resolution.
No attorney facing the barrel of a motion to vacate ever wants to hear the dreaded words, “counselor, for public policy reasons, we will set the judgment aside and hear the case on its merits.” The blood runs down and the feeling sets in as you realize you will have to inform your client that the process will now start all over. Yet again, the desperation and desire for closure begins once more with the realization that it was all a double-edged sword.
