Opinion ID: 2013434
Heading Depth: 2
Heading Rank: 3

Heading: Criteria to Consider in Striking an Answer

Text: ¶ 40. The third issue concerns the criteria the court should consider in deciding a motion to strike an answer when the answer is not filed within a reasonable time after service. Specifically, must the circuit court find that either the moving party or the court was prejudiced by late filing of the answer before it can grant a motion to strike? ¶ 41. Wisconsin Stat. § 806.02 authorizes the court to enter a default judgment under subsections (1)-(4) if no issue of law or fact has been joined and if the time for joining issue has expired. Wis. Stat. § 806.02(1). Subsection (1) raises two questions: (1) When is an issue of law or fact joined? and (2) When does the time for joining issue expire? ¶ 42. A court may not enter default judgment under Wis. Stat. § 806.02(1)-(4) if the defendant has joined issue. [15] For purposes of this case, we will assume without deciding that the defendant's timely service of the answer did not join issue, in the absence of timely filing. [17] ¶ 43. Making this assumption does not settle the matter. A defendant's failure to join issue does not require a court to enter default judgment. Shirk v. Bowling, Inc., 2001 WI 36, ¶ 9, 242 Wis. 2d 153, 624 N.W.2d 375; Hansher v. Kaishian, 79 Wis. 2d 374, 387, 255 N.W.2d 564 (1977). The use of the word may (a default judgment may be rendered) in Wis. Stat. § 806.02(1) compels the circuit court to exercise sound discretion before entering a default judgment. Oostburg State Bank v. United Sav. & Loan Ass'n, 130 Wis. 2d 4, 11, 386 N.W.2d 53 (1986). In any event, the failure to join issue does not necessarily mean that the time for joining issue has expired. [18] ¶ 44. If we assume that issue is not joined solely by timely service of the answer, when does the time for joining issue expire? We conclude that the time for joining issue expires, with respect to filing an answer, when: (1) the answer is not filed within a reasonable time after service; and (2) the defendant is unsuccessful in moving to enlarge time to file the answer. ¶ 45. If an answer is filed late and the plaintiff moves to strike the late answer, the defendant must take some step, sooner or later, to bring itself into compliance and have its late filing recognized as valid. The most logical step is a motion to enlarge time. If the defendant makes no effort to enlarge time, there continues to be no joinder of issue (as assumed for purposes of this case). [19] ¶ 46. In this case, Lumber Liquidators did not move to enlarge time under Wis. Stat. § 801.15(2) or any other rule. Split Rock contends that Lumber Liquidators should have filed a motion under Wis. Stat. § 801.15(2) to enlarge time, and it reasons that a circuit court should not be expected to decide a motion that was never filed. ¶ 47. This common sense argument would be very persuasive were it not for the language in Wis. Stat. § 801.15(2)(a). The rule reads in part: (a) When an act is required to be done at or within a specified time, the court may order the period enlarged but only upon motion for cause shown and upon just terms. . . . If the motion is made after the expiration of the specified time, it shall not be granted unless the court finds that the failure to act was the result of excusable neglect. The order of enlargement shall recite by its terms or by reference to an affidavit in the record the grounds for granting the motion. Wis. Stat. § 801.15(2)(a). ¶ 48. This rule contemplates enlarging a specified time period for an act required to be done at or within a specified time. We have already determined that a reasonable time is not a specified time. It is an unspecified time. Hence, § 801.15(2) does not apply in this situation. ¶ 49. The inapplicability of this rule is quite clear. When a rule requires that an act be done at or within a specified time, it gives clear notice of what is expected. Thus, when a party moves to enlarge a specified time under Wis. Stat. § 801.15(2), it knows that it has the burden to show cause before the specified time expires or excusable neglect after the specified time expires. If, however, a party were to move to enlarge an unspecified time under § 801.15(2), it would not know when its burden shifted from cause to excusable neglect. In effect, all motions would concede lateness and all would be treated as though the filings were late. Hence, if a defendant were required to submit a motion under Wis. Stat. § 801.15(2) to enlarge the time to file a timely served answer, it would trigger an analysis of excusable neglect. ¶ 50. Under the rule, the burden of establishing excusable neglect is on the moving party, not on the party seeking to strike the answer. Wisconsin Stat. § 801.15(2) provides in part that, If the motion is made after the expiration of the specified time, it shall not be granted unless the court finds that the failure to act was the result of excusable neglect. We reinforced this tough language in Hedtcke v. Sentry Ins. Co ., saying: If the motion is made after the expiration of the specified time, an order enlarging the time for performing an act must be based on a finding of excusable neglect; when the circuit court determines that there is no excusable neglect, the motion must be denied. Hedtcke v. Sentry Ins. Co., 109 Wis. 2d 461, 468, 326 N.W.2d 727 (1982) (emphasis added). ¶ 51. Consequently, the probable effect of a motion under § 801.15(2)in any situation in which the defendant failed to file within a reasonable time after service because of inadvertence, carelessness, or inattentivenesswould be a denial of the motion, leading to a default judgment. The rule would dictate a default judgment for a relatively minor infraction even if the late filing did not prejudice the plaintiff or the court. This result would be completely at odds with the practice under Federal Rule 5. ¶ 52. As noted above, in the federal system, failure to promptly file generally is corrected by an order to compel filing, inasmuch as federal courts view the timely serving of a paper, particularly an answer, as far more significant than the filing of a paper with the court. [E]ntry of default is exceptional. Wright & Miller, supra, § 1152. A motion for default judgment under Rule 5(d) isn't taken seriously until the moving party shows prejudice. See Biocore, 181 F.R.D. at 668; Wilson v. United States, 112 F.R.D. 42, 43 (N.D. Ill. 1986). [16] [20] ¶ 53. We believe the federal practice is sound and conclude that a plaintiff should not move to strike an answer that is not filed within a reasonable time after service unless the plaintiff is prepared to show prejudice to itself or to the court. Offering less-compelling grounds to strike an answer in this situation is an attempt to secure a judicial sanction that is disproportionate to the defendant's error. [21] ¶ 54. This brings us to a discussion of what each party should have done under the circumstances of this case. If a defendant fails to file a timely served answer within a reasonable time after service, the plaintiff may move for a just order under Wis. Stat. § 805.03. [17] This rule authorizes the circuit court to issue a full range of orders in response to a party's failure to comply with the statutes governing procedure in civil actions. Wis. Stat. § 805.03. The plaintiff's motion may seek the immediate filing of the answer or an appropriate sanction, including costs and attorney's fees, or both. The motion may also ask the court to strike the answer and enter a default judgment as a sanction if the plaintiff can show prejudice to itself or to the court. [22, 23] ¶ 55. The appropriate response to a motion to strike an answer on grounds that the answer was not filed within a reasonable time after service is to file the answer and then move to enlarge time under Wis. Stat. § 802.01(2). [18] Moving to enlarge time under § 802.01(2) will give the circuit court flexibility in weighing the facts, the equities, and the policies at issue. This would not be the case under Wis. Stat. § 801.15(2), which imposes upon a movant a heavy burden to avoid the ultimate sanction. In Connor, we said that in its exercise of discretion in considering default judgment, the circuit court must attempt to strike the appropriate balance between the countervailing policy considerations that consistently pull at either end of the default judgment spectrum. Connor, 2001 WI 49, ¶ 27 (quoting J.L. Phillips & Assocs. v. E&H Plastic Corp., 217 Wis. 2d 348, 577 N.W.2d 13 (1998)). This would be very difficult if the court's determination pivoted on the presence or absence of excusable neglect. [24] ¶ 56. There are at least two reasons why a defendant should move to enlarge time under Wis. Stat. § 802.01(2) rather than Wis. Stat. § 801.15(2) in the specific instance of a late-filed answer. First, as noted above, when the defendant fails to file a timely served answer within a reasonable time after service, the defendant is not in violation of a rule requiring that an act be done at or within a specified time. As a result, the defendant need not seek to enlarge time under a rule that speaks to compliance with a specified time. [25] ¶ 57. Second, a defendant who fails to file an answer within a reasonable time after service is in violation of a somewhat imprecise rule. We stated in Sorenson that, if a procedural rule is ambiguous, we are likely to construe it liberally so as to encourage a resolution of the controversy on the merits. Sorenson, 2000 WI 43, ¶ 15 (citing DOT v. Peterson, 226 Wis. 2d 623, 633, 594 N.W.2d 765 (1999) (citations omitted)). We would not be construing this rule liberally if we forced an erring defendant to seek relief under Wis. Stat. § 801.15(2). [26] ¶ 58. To sum up, a plaintiff may address a defendant's failure to file an answer within a reasonable time after service by filing a motion for a just order under Wis. Stat. § 805.03. The motion may seek to strike the answer as a sanction when the plaintiff is prepared to establish prejudice to itself or to the court. The court may exercise its discretion to enter an order that is just, but it may not strike the answer unless and until it finds prejudice to the plaintiff or to the court, examines the merits of any motion to enlarge time, and explains the reasoning for its determination in writing or on the record.