Opinion ID: 786496
Heading Depth: 2
Heading Rank: 2

Heading: The Merits of the Fed.R.Civ.P. 60(b)(1) Excusable Neglect Claim.

Text: 25 Harms Construction contends it is entitled to relief under Fed. R. Civ. P 60(b)(1)'s excusable neglect standard. Citing Pioneer Investment Services v. Brunswisk Assoc., 507 U.S. 380, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993), Harms Construction argues the excusable neglect standard must be broadly construed. See Robb v. Norfolk & W. Ry. Co., 122 F.3d 354, 361-62 (7th Cir.1997) (acknowledging that `excusable neglect' has a new and broader meaning in the aftermath of the [ Pioneer ] decision). Although Pioneer involved a Bankruptcy Rule, subsequent courts have held that Pioneer 's interpretation of excusable neglect extends to other federal procedural rules including Fed.R.Civ.P. 60(b)(1). See Robb, 122 F.3d at 362 n. 6 (noting that some courts have held it to be an abuse of discretion to not grant relief under Fed.R.Civ.P. 60(b)(1) in certain missed deadline situations in light of Pioneer ). Pioneer 's broad construction of the excusable neglect standard applies here as well. 26 Under Pioneer, the determination whether a party's neglect is `excusable' is essentially an equitable one, in which courts are to take into account all relevant circumstances surrounding a party's failure to file. Chemetron Corp. v. Jones, 72 F.3d 341, 349 (3d Cir.1995) (citing Pioneer, 507 U.S. at 395, 113 S.Ct. 1489). The Supreme Court identified, without limitation, these factors to consider: the danger of prejudice ..., the length of the delay and its potential impact on judicial proceedings, the reason for the delay, including whether it was within the reasonable control of the movant, and whether the movant acted in good faith. Pioneer, 507 U.S. at 395, 113 S.Ct. 1489. 27 Harms Construction alleges the ALJ erred by weighing too heavily the control factor at the expense of other relevant Pioneer factors. We agree. The ALJ properly recognized that the factors of prejudice and good faith weighed in favor of Harms Construction, see George Harms Constr. Co., 2003 OSAHRC LEXIS 19, at  (holding that Nyland acted quickly and in good faith promptly upon discovering the fact of the citation and that because the Secretary proceeded to litigate the matter by serving a motion to extend her time to file her complaint,... the late [notice of contest] caused her no prejudice), and there is no evidence that the delay caused an adverse effect on efficient judicial administration. But the ALJ, relying on CalHar Constr. Inc., No. 98-0367, 2000 OSAHRC LEXIS 28 (OSAHRC April 27, 2000), noted that the Commission considers a key factor to be whether the delay was within the reasonable control of the employer, and concluded that [i]t is on this issue that [Harms Construction's] proof falls short because Pelsang, the Harms Construction employee who signed for the citations and was most familiar with Harms Construction's mailing procedures, failed to testify. Id. -6. Without Pelsang's testimony, the ALJ held he could not make a determination that the failure to file a timely notice of contest was not within the company's control. Id. at . 28 The ALJ's excusable neglect calculus was improper. Under Pioneer, a court must take into account all relevant circumstances surrounding a party's failure to file, and failing to disprove reasonable control is not necessarily fatal to a petitioner's request for relief. To state it differently, the control factor does not necessarily trump all the other relevant factors. As the Supreme Court concluded in Pioneer: [T]he lack of any prejudice to the [opposing party] or to the interests of efficient judicial administration, combined with the good faith of respondents and their counsel, weigh strongly in favor of permitting the tardy claim. 507 U.S. at 398, 113 S.Ct. 1489. As the Commission has recognized, in Fed.R.Civ.P. 60(b)(1) late filing cases, it is usually a given that there is a lack of prejudice to the Secretary or to the interests of efficient judicial administration, combined with a lack of bad faith by the employer. CalHar Constr. Inc., No. 98-0367, 2000 OSAHRC LEXIS 28,  n. 5. But just because those factors may nearly always favor the petitioner does not mean that the Commission should ignore them. 29 Moreover, even when assessing the control factor, we do not believe that it weighs against Harms Construction here. The ALJ concluded that without Pelsang's testimony, he could not determine whether Harms Construction's failure to file a timely notice of contest was within the company's control. George Harms Constr. Co., 2003 OSAHRC LEXIS 19, at . At the hearing, Nyland testified that Pelsang told him she had no memory of the citations and would have nothing to add. The ALJ found Nyland to be a credible witness, but held his testimony only established that Pelsang made the statement to Nyland; it does not prove ... that she in fact, could not recall accepting the citation. Id. at n. 4. 30 At the hearing, the Secretary did not object to Nyland's testimony as inadmissible hearsay. In an administrative hearing, `[w]hen [hearsay evidence] is admitted without objection it is to be considered and given its natural probative effect as if it were in law admissible.' E & R Erectors v. Sec'y of Labor, 107 F.3d 157, 161 (3d Cir.1997) (quoting Diaz v. United States, 223 U.S. 442, 450, 32 S.Ct. 250, 56 L.Ed. 500 (1912)). Had the Secretary objected, Harms Construction apparently would have produced Pelsang to testify directly. There is no reason to infer that Pelsang's testimony would have been adverse to Harms Construction. Because of Pelsang's lack of memory attributable to the passage of time and volume of mail she administers, Harms Construction reasonably believed she could add nothing of value to the hearing. 31 Nyland's testimony of Harms Construction's otherwise reliable mail-handling procedures demonstrates the loss of the citations was an unforeseeable human error beyond its reasonable control. According to Nyland, Pelsang had been responsible for delivering the mail for six years. In that period, Nyland had never failed to receive any mail. Accordingly, the control factor does not weigh against Harms Construction. Because the Pioneer factors of good faith, prejudice, efficient judicial administration, and control all weigh in favor of Harms Construction, it has sufficiently shown excusable neglect and is entitled to relief under Fed.R.Civ.P. 60(b)(1). 5