January 4, 2019

The Abuse Of Discretion Standard Is Especially Deferential On Appeal When The Trial Court Has Set Aside A Default Judgment; Wamsley v. Tree City Village

Category: Indiana Law Review | Author: | Share:

When we last spoke in March, we told you about a decision from the Indiana Court of Appeals which held that simple neglect is not the same as excusable neglect and reversed a trial court’s decision granting relief from a default judgment. In a brief opinion, the Indiana Supreme Court emphasized how much deference trial courts get on these decisions.

Joseph and Wamsley were neighbors in an apartment complex. Joseph was cleaning his gun one day, when it discharged and hit Wamsley, injuring her. Wamsley hired Attorney Vick to represent her.

Vick sent a letter to the landlord, notifying it of his representation of Wamsley and asking that the landlord’s insurer be put on notice. A couple of weeks later, Vick received a letter from the insurer, and the two exchanged certain information. Ultimately, the insurer denied Wamsley’s claim.

Vick then filed a complaint on Wamsley’s behalf. He served the complaint on the landlord but did not send a copy to the insurer. The landlord also did not send a copy to the insurer. Rather, the landlord sent Vick a letter and filed the complaint away in a cabinet.

When the landlord did not timely answer the complaint, Wamsley moved for default judgment. The trial court granted that motion, only to have the landlord appear and move to vacate the default, arguing excusable neglect. The trial court granted the landlord’s motion, and Wamsley appealed. The Court of Appeals said that the landlord’s “striking lack of attention” to the suit was inexcusable and reversed the trial court’s decision.

On transfer, the Court found that the appellate court did not defer to the trial court’s decision enough.

An appellate court reviews a trial court’s decision to set aside a default judgment for abuse of discretion, resolving any doubt as to the propriety of default judgment in favor of the defaulted party. The controlling question is whether there exists “even slight evidence of excusable neglect.”

Our deferential standard of review compels us to affirm the trial court. There exists evidence of excusable neglect in this case—although that evidence is indeed exceedingly slight—and Landlords have made the requisite showing under Trial Rule 60(B)(1) of a meritorious defense.

If I were an appellee in an appeal using an abuse of discretion standard, then this is a case I would want to keep in my quiver.

Lessons:

  1. Even slight evidence of excusable neglect is sufficient to overturn a default judgment.
  2. On appellate review of an overturned default, any doubt is to be resolved in favor of the defaulted party.