MARSHALL DAVIS, INC., D/B/A EINSTEIN FINANCIAL, APPELLANT,
v.
INCAPCO, INC., D/B/A TELAMARKETING COMMUNICATIONS OF TAMPA BAY, APPELLEE
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Marshall Davis, Inc. appeals a default judgment entered against it after its employee failed to forward suit papers to company counsel. The court reversed, holding that the trial court abused its discretion in refusing to set aside the default where the defendant demonstrated diligence, excusable neglect due to departure from established corporate procedures, and a meritorious defense.
The trial court abused its discretion in refusing to set aside the default judgment. Marshall Davis satisfied all requirements for setting aside a default: it acted diligently upon learning of the judgment, the failure to respond was due to excusable neglect (deviation from established corporate procedures), and it presented a meritorious defense.
[1] A default judgment may be set aside upon a showing of excusable neglect, a meritorious defense, and diligent action to seek the setting aside of the default.
[2] Failure of an employee to follow established corporate procedures for forwarding suit papers to counsel can constitute excusable neglect for purposes of setting aside a d…
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Join FLexlaw to unlock all legal intelligence“In order to have a default set aside, a party must proceed diligently to have the default set aside and show excusable neglect and a meritorious defense.”
Establishes the three-part test required for setting aside a default judgment in Florida.
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Join FLexlaw to unlock all legal intelligenceIncapco sued Marshall Davis on an open account and served the resident agent in Florida on January 9, 1989. The summons and complaint were forwarded t…
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PARKER, Acting Chief Judge.
Appellant, Marshall Davis, Inc., d/b/a Einstein Financial, appeals a final judgment in favor of appellee, Incapco, Inc., d/b/a Telamarketing Communications of Tampa Bay, which final judgment was entered as a result of a default. We find the trial court abused its discretion in failing to set aside the default judgment and reverse.
Incapco filed suit against Marshall Davis on an open account. Incapco perfected service of process on Marshall Davis, a Colorado based nationwide corporation, by serving the resident agent in Florida on January 9, 1989. The resident agent forwarded the summons and complaint to Dennis Hol-torf, an employee of Marshall Davis. Marshall Davis had in place at the time a corporate procedure whereby Holtorf was responsible for ensuring that suit papers were forwarded to local counsel for Marshall Davis. Holtorf knew of and was familiar with the reporting procedure, as he had forwarded numerous suit papers to Marshall Davis’s attorneys in the past. For unknown reasons, Holtorf, failing to comply with these policies, did not forward the papers that he received. Shortly thereafter, Holtorf left the employ of Marshall Davis. On March 3, 1989, the clerk of court entered a default against Marshall Davis. One month later, on April 6, 1989, the trial court entered a final judgment against Marshall Davis.
Marshall Davis alleged that it learned of the lawsuit and the default judgment on April 11, 1989. Then on April 26, 1989, counsel for Marshall Davis filed a motion to vacate the final judgment. Attached to the motion was a supporting affidavit setting forth facts relating to Marshall Davis’s contention that its failure to respond to the complaint was due to excusable neglect. Marshall Davis also filed a motion to dismiss, setting forth its defenses to the complaint. The trial judge denied Marshall Davis’s motion to vacate the final judgment.
In order to have a default set aside, a party must proceed diligently to have the default set aside and show excusable neglect * and a meritorious defense. Canney v. Canney, 453 So. 2d 179 (Fla. 2d DCA 1984). In the instant case, Marshall Davis was diligent in filing the motion to set aside default after learning of the lawsuit. Also, Marshall Davis filed a sworn affidavit, stating that it had an established corporate policy for handling lawsuits which was not followed in this case. Courts of Florida have held that this constitutes excusable neglect. Carter, Hawley, Hale Stores, Inc. v. Whitman, 516 So. 2d 83 (Fla. 3d DCA 1987); Plotkin v. Deatrick Leasing Co., 267 So. 2d 368 (Fla. 3d DCA 1972). Finally, Marshall Davis presented a meritorious defense.
We conclude that the preceding facts established that the trial court abused its discretion when it refused to set aside the default. There is a strong preference in the law for lawsuits to be determined on the merits; therefore, courts should liberally set aside defaults under appropriate circumstances. North Shore Hosp., Inc. v. Barber, 143 So. 2d 849 (Fla.1962); Bland v. Viking Fire Protection, Inc. of the Southeast, 454 So. 2d 763 (Fla. 2d DCA 1984). Although a party must establish a gross abuse of the trial court’s discretion to justify an appellate court’s reversal of a ruling on a motion to set aside a default, a lesser showing is required to reverse a denial of a motion to set aside a default than to reverse a granting of such motion. Garcia Ins. Agency, Inc. v. Diaz, 351 So. 2d 1137 (Fla. 2d DCA 1977).
Reversed and remanded for further proceedings consistent with this opinion.
PATTERSON and ALTENBERND, JJ., concur. *
Other reasons for setting aside a default are contained in Florida Rule of Civil Procedure 1.540(b).
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Cited By (23 total)
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Geer v. David Neal Jacobsen, Brian James Almengual, & Almengual & Warner, P.A., 880 So. 2d 717 (Fla. 2d DCA 2004)…se the trial court granted relief, a higher standard is applied to overturn the decision than if the trial court had denied the motions. Lindell Motors, Inc. v. Morgan, 727 So. 2d 1112, 1113 (Fla. 2d DCA 1999); Marshall Davis, Inc. v. Incapco, Inc., 558 So. 2d 206, 208 (Fla. 2d DCA 1990). We recognize, as did the trial judge, that there is a strong preference for lawsuits to be determined on the merits and that courts should liberally set aside defaults under appropriate circumstances. See Marshall Davis, 55…
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Allstate Floridian Ins. Co. v. Ronco Inventions, LLC, 890 So. 2d 300 (Fla. 2d DCA 2004)…ee with its finding that they demonstrated due diligence. For this court to reverse an order granting a motion for relief from a default, the appellant must show a gross abuse of discretion by the trial court. Marshall Davis, Inc. v. Incapco, Inc., 558 So. 2d 206 (Fla. 2d DCA 1990). This extremely high standard of review reflects the implementation of the “principle of liberality” in setting aside defaults so that lawsuits may be decided on their merits. Lindell Motors, Inc. v. Morgan, 727 So. 2d 1112, 1113…1 / 2
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Elliott v. Aurora Loan Servs., LLC, 31 So. 3d 304 (Fla. 4th DCA 2010)…o. 2d 300, 303 (Fla. 2d DCA 2004) (citing Goodwin v. Goodwin, 559 So. 2d 109 (Fla. 2d DCA 1990) (six-day delay)); Coquina Beach Club Condo. Ass’n v. Wagner, 813 So. 2d 1061 (Fla. 2d DCA 2002) (seven-day delay); Marshall Davis, Inc. v. Incapco, Inc., 558 So. 2d 206 (Fla. 2d DCA 1990) (fifteen-day delay)). Thus, the Elliotts exercised due diligence by filing the motion to vacate the default within six days of discovery of the default. Because the Elliotts demonstrated the elements necessary to set aside the de…
Previewing 3 of 23 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- N. Shore Hosp., Inc. v. Barber, 143 So. 2d 849 (Fla. 1962)
- Garcia Ins. Agency, Inc. v. Diaz, 351 So. 2d 1137 (Fla. 2d DCA 1977)
- Carter v. Whitman, 516 So. 2d 83 (Fla. 3d DCA 1987)
- Plotkin v. Deatrick Leasing Co., 267 So. 2d 368 (Fla. 3d DCA 1972)
- Bland v. Viking Fire Prot., 454 So. 2d 763 (Fla. 2d DCA 1984)
- Canney v. Canney, 453 So. 2d 179 (Fla. 2d DCA 1984)