In 1873, the Florida Legislature enacted a statute providing for the vacating of defaults upon “good cause shown” and “within sixty days from the time of entry of such default.”[1] Though the statute was repealed in 1955, the Supreme Court of Florida assured the purpose was not to eliminate the procedure for vacating defaults.[2] Pursuant to Florida Rules of Civil Procedure 1.500(d), the trial court is vested with discretion to set aside a default.[3] The interpretations and rules governing setting aside defaults apply a principle of liberality to encourage causes of action be heard on their merits.[4] Where a question exists as to a movant meeting the criteria for setting aside a default, “all reasonable doubts should be resolved in favor of setting aside the default.”[5]
The court will exercise its discretion upon hearing a Rule 1.540(b) motion to vacate default or a motion to set aside default judgment based upon a three-prong test analysis.[6] The movant must demonstrate: (1) excusable neglect in failing to timely respond to the allegations of the complaint, (2) due diligence in seeking relief from a default or default judgment after discovery of same, and (3) a meritorious defense exists.[7] The court must deny a Rule 1.540(b) motion if any one of the three elements is not established.[8] The burden of establishing the presence of the three-prongs is upon the movant.[9]
This type of analysis has been followed in this state since at least 1863 when the Supreme Court of Florida inquired into the reason for delay, fault, and defenses alleged by the defendant upon hearing a motion to have the default opened.[10]
The Second District Court of Appeal has observed a distinction between the two types of relief sought, “albeit of degree”, ruling that the court examines denial of a motion to set aside a default with more caution and holds to movant to a lesser standard than one requesting a final judgment be set aside.[11]
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.”[12] To establish excusable neglect, the movant must file an affidavit or sworn statement explaining or justifying the mistake or inadvertence.[13] The affidavit or sworn statement must prove a legal excuse exists for failing to respond to the complaint in a timely fashion.[14] An unsworn assertion of excusable neglect will not suffice to meet this prong.[15] An affidavit which is void of supporting factual basis for the alleged excusable neglect will not constitute excusable neglect.[16]
In analyzing whether a movant has alleged excusable neglect in failing to timely respond to the complaint, Florida District Courts of Appeal have ruled in some of the following ways:
Due diligence in moving to have a default set aside is determined by the facts of each case.[24] The Second District Court of Appeal of Florida acknowledged that there is no “bright line rule” as to when a delay in moving to set aside a default does or does not constitute due diligence.[25] To determine due diligence, the Court analyzed the period of time of the delay by the standard of reasonableness, including the duration of the delay among other factors of reasonableness.[26] The Court cites to Techvend, Inc. v. Phoenix Network, Inc. to suggest that as a rule of thumb the starting point for the period of time given to a defendant to move to vacate a default is within 20 days after learning of its entry.[27] No subsequent authority implements a 20-day period as a bright line rule, though no subsequent authority has implemented otherwise. Rather, the courts consider both the extent of the delay and the reason for the delay to determine whether it was unreasonable and therefore insufficient to show the movant acted with due diligence.[28]
In analyzing whether the period of time elapsed before moving to vacate a default exhibits due diligence, Florida District Courts of Appeal have ruled in some of the following ways:
When moving to vacate a default, the movant must state a defense that may have some merit.[38] Meritorious does not mean the court will determine whether the defense raised is likely to succeed.[39] Nonetheless, the movant must disclose the defense itself, even with minimal specificity.[40] A conclusory assertion that a meritorious defense exists is insufficient.[41] A general denial of the allegations of the complaint also will not rise to the level of a meritorious defense.[42]
To set forth a meritorious defense, a proposed answer setting out in detail the affirmative defenses plead should be attached to the motion to vacate.[43] Additionally, the court may require certain procedural observations depending whether the movant’s alleged defense is a factual defense versus a legal defense. Where the movant is alleging a legal defense, it may be set forth in an unverified pleading or an affidavit.[44] The movant must show legal grounds exist constituting said meritorious defense to support their motion.[45] If the movant is relying on a factual defense, it must be set forth in a verified answer, sworn motion, or affidavit.[46] The ultimate facts establishing the defense must be set forth therein.[47]
In analyzing whether a meritorious defense was plead, Florida Courts have ruled in some of the following ways:
Pursuant to Florida Rules of Civil Procedure 1.540, subsection (b) provides relief from final judgment, decree, order, or proceeding to be requested by motion on five specified grounds. When a court exercises discretion to determine whether to grant a motion to vacate, it is bound to apply the three-prong test annunciated herein.[53] The movant must produce sufficient evidence of mistake, accident, excusable neglect or surprise as contemplated by rule 1.540(b) before the courts equity jurisdiction may be invoked.[54] Therefore, to support a Motion to Vacate the movant must have a legal basis under Rule 1.540 and an entitlement pursuant to the three-prong test.[55]
The standard of review on appeal is a gross abuse of discretion in the trial court’s ruling on a motion to vacate.[56] A notable distinction between a motion to vacate a default versus vacating a default judgment is the rule that an order vacating a default is generally not reviewable absent a final default judgment.[57] A motion to vacate a final default judgment is appealable under Florida Rule of Appellate Procedure 9.130(a)(5).[58]
When a party seeks to set aside an order of the court, if the order was void as a matter of law when entered then such order will be set aside.[59] However, a motion seeking same must be made within “reasonable time.”[60] In Waiswilos v. Feacher, filing of said motion five years after dismissal was not within reasonable time and therefore the order dismissing the cause of action for lack of prosecution stood even though it would have been void in that the evidence on the face of the record indicated action had been taken within one year prior to said order.[61]
When a default is entered, the defendant admits the plaintiff’s entitlement to liquidated damages, but not unliquidated damages.[62] If the ascertainment of the exact sum of damages requires testimony and other evidence to determine which to base a value for judgment, the damages are unliquidated.[63]
After default is entered, an order setting hearing to determine damages on unliquidated damages entitles the party whom default has been entered against to a trial on the issue of unliquidated damages pursuant to Florida Rules of Civil Procedure 1.440(c).[64] Absent a demand for a jury trial, a trial before the Judge is required when a claim involves unliquidated damages.[65] Therefore, though a Judge may ultimately deny a motion to set aside a default judgment, the appellate court could remand a case to be heard on the issue of unliquidated damages.
The District Courts of Appeal across the State of Florida seemingly apply a uniform interpretation of the three-prong test required to be met for a movant to have a default or default judgment set aside. The distinction between the two types of motions is miniscule, though notable when deciding whether to appeal the trial court’s ruling on a motion to vacate.
To have a default vacated, the movant must demonstrate excusable neglect in failing to file a responsive pleading, due diligence upon learning of the entry of the default, and existence of a meritorious defense. In short, excusable neglect must be proven by a sworn statement or affidavit justifying the mistake or inadvertence. Due diligence is determined by a standard of reasonableness based the facts of each case, including the extent of the delay and the reasons for the delay. When alleging a meritorious defense, a factual defense requires: a verified answer, sworn motion, or affidavit; whereas a legal defense may be stated in an unverified pleading. The courts analysis of a Rule 1.540 motion is based on a totality of circumstances and the standards of proof for each of the three prongs as set forth above. So long as there exist legal grounds pursuant to Florida Rules of Civil Procedure 1.540(b), the court is likely to exercise its discretion to rule on a motion to vacate.
There are rules of law pertaining to the grounds under which relief by a motion to vacate may be sought, the appealability of an order on a motion to vacate, and a defaulted defendants entitlement to a trial on unliquidated damages which should be observed by counsel, whether filing or defending against a motion to vacate. As counsel for Plaintiff and generally in a defensive position against a motion to vacate default, the observance of these technical requirements is especially important when seeking to collect against a defendant whom has been defaulted and seeks same be vacated.
If you or your company are facing a default judgment, please contact us quickly. Time is of the essence.
[1] Fla. Stat. § 50.10 (1953).
[2] N. Shore Hosp., Inc. v. Barber, 143 So. 2d 849, 851 (Fla. 1962).
[3] Fla. R. Civ. P. 1500(d); Lindell Motors, Inc. v. Morgan, 727 So. 2d 1112, 1112 (Fla. 2d DCA 1999).
[5] Szucs v. Qualico Dev., Inc., 893 So. 2d 708, 710 (Fla. 2d DCA 2005).
[7] Santiago v. Mauna Loa Investments, LLC, 189 So. 3d 752, 758 (Fla. 2016). See also Coquina Beach Club Condo. Ass'n, Inc. v. Wagner, 813 So. 2d 1061, 1063 (Fla. 2d DCA 2002).
[8] Household Fin. Corp., III v. Mitchell, 51 So. 3d 1238, 1241 (Fla. 1st DCA 2011).
[9] Geer v. Jacobsen, 880 So. 2d 717, 720 (Fla. 2d DCA 2004).
[10] Waterson v. Seat, 10 Fla. 326 (1863).
[11] See Hunt Exterminating Co. v. Crum, 598 So. 2d 113, 114 (Fla. 2d DCA 1992); Marshall Davis, Inc. v. Incapco, Inc., 558 So. 2d 206 (Fla. 2d DCA 1990); Ponderosa, Inc. v. Stephens, 539 So. 2d 1162 (Fla. 2d DCA 1989); Finkel Outdoor Prods. v. Lasky, 529 So. 2d 317 (Fla. 2d DCA 1988).
[12] Elliott v. Aurora Loan Servs., LLC, 31 So. 3d 304, 307 (Fla. 4th DCA 2010).
[13] Coquina Beach Club Condo. Ass’n, Inc., 813 So. 2d at 1063.
[14] United Capital Funding Corp. v. Technamax, Inc., 946 So. 2d 63, 64 (Fla. 2d DCA 2006).
[15] DiSarrio v. Mills, 711 So.2d 1355, 1356 (Fla. 2d DCA 1998).
[16] L.B.T. Corp. v. Camacho, 429 So. 2d 88, 90 (Fla. 5th DCA 1983).
[17] Goldome v. Davis, 567 So. 2d 909 (Fla. 2d DCA 1990).
[18] Apolaro v. Falcon, 566 So. 2d 815, 817 (Fla. 3d DCA 1990).
[19] Schauer v. Coleman, 639 So. 2d 637, 639 (Fla. 2d DCA 1994).
[20] Szucs, 893 So. 2d at 711. See also Joe–Lin, Inc. v. LRG Rest. Group, Inc., 696 So. 2d 539, 541 (Fla. 5th DCA 1997).
[21] Am. Network Transp. Mgmt., Inc. v. A Super-Limo Co., 857 So. 2d 313, 315 (Fla. 2d DCA 2003).
[22] Geer, 880 So. 2d at 721.
[23] Prof'l Golf Glob. Grp., LLC v. Huynh, 251 So. 3d 1038, 1041 (Fla. 2d DCA 2018).
[24] Coquina Beach Club Condo. Ass'n, Inc., 813 So. 2d at 1064 (citing Conidaris v. Credit Alliance Corp., 558 So. 2d 523, 524 (Fla. 5th DCA 1990).
[25] Allstate Floridian Ins. Co. v. Ronco Inventions, LLC, 890 So. 2d 300, 303 (Fla. 2d DCA 2004).
[27] Id.; Techvend, Inc. v. Phoenix Network, Inc., 564 So. 2d 1145, 1146 (Fla. 3d DCA 1990).
[28] Prof'l Golf Glob. Grp., LLC, 251 So. 3d at 1041.
[29] Am. Network Transp. Mgmt., Inc., 857 So. 2d at 315.
[30] Lindell Motors, Inc., 727 So. 2d at 1113.
[31] Prof'l Golf Glob. Grp., LLC, 251 So. 3d at 1041.
[32] Bayview Tower Condominium Ass'n, Inc. v. Schweizer, 475 So. 2d 982, 983 (Fla. 3d DCA 1985).
[33] Trinka v. Struna, 913 So. 2d 626, 628 (Fla. 4th DCA 2005).
[34] Fischer v. Barnett Bank of South Florida, N.A., 511 So. 2d 1087 (Fla. 3d DCA 1987).
[35] Lazcar Int'l, Inc. v. Caraballo, 957 So. 2d 1191, 1993 (Fla. 3d DCA 2007).
[36] Allstate Floridian Ins. Co., 890 So. 2d at 304.
[37] Techvend, Inc., 564 So. 2d at 1145.
[38] Household Fin. Corp., III, 51 So. 3d at 1241.
[39] Rice v. James, 740 So. 2d 7 (Fla. 1st DCA 1999).
[40] Elliott, 31 So. 3d at 308.
[41] Church of Christ Written in Heaven of Georgia, Inc. v. Church of Christ Written in Heaven of Miami, Inc., 947 So. 2d 557 (Fla. 3d DCA 2006).
[42] Household Fin. Corp., III, 51 So. 3d at 1241.
[43] Elliott, 31 So. 3d at 308.
[44] Am. Network Transp. Mgmt., Inc., 857 So. 2d at 315.
[45] Geer, 880 So. 2d at 721.
[46] Prof'l Golf Glob. Grp., LLC, 251 So. 3d at 1041.
[47] Westinghouse Elevator Co., a Div. of Westinghouse Elec. Corp. v. DFS Const. Co., 438 So. 2d 125 (Fla. 2d DCA 1983).
[48] Household Fin. Corp., III, 51 So. 3d at 1241.
[49] Spring Valley Club Apartments, Ltd. v. Nichols, 729 So. 2d 543, 544 (Fla. 1st DCA 1999).
[50] Glob. Const. Servs., Inc. v. Jackson, 890 So. 2d 445, 446 (Fla. 4th DCA 2004).
[51] Chaney v. Headley, 90 So. 2d 297 (Fla. 1956).
[52] Perry v. Univ. Cabs, Inc., 344 So. 2d 914, 915 (Fla. 3d DCA 1977).
[53] 27 C.J.S. Dismissal and Nonsuit § 101.
[54] Bank of New York Mellon v. Peterson, 208 So. 3d 1218, 1222 (Fla. 2d DCA 2017).
[56] Collins v. Collins, 519 So. 2d 729, 730 (Fla. 2d DCA 1988).
[57] Howard v. McAuley, 436 So. 2d 392 (Fla. 2d DCA 1983).
[58] Sunny S. Aircraft Serv., Inc. v. Inversiones, 417 So. 2d 676, 677 (Fla. 1982). See Fla. R. App. P. 9.130(a)(5) (providing “orders entered on an authorized and timely motion for relief from judgment are reviewable by the method prescribed by this rule”).
[59] Waiswilos v. Feacher, 370 So. 2d 1250, 1251 (Fla. 4 th DCA 1979).
[62] Szucs, 893 So. 2d at 712.
[63] Bowman v. Kingsland Development, Inc., 432 So.2d 660, 662–63 (Fla. 5th DCA 1983).
[64] L.B.T. Corp., 429 So. 2d at 91.
[65] Szucs, 893 So. 2d at 712.
