Court Opinion

ID: 21053
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:40:37+00
Date Added: 2024-06-11T15:04:38.281975
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS
                       FOR THE FIFTH CIRCUIT

                           No. 99-41263
                         Summary Calendar

ANN BEST ELITE TEMPORARIES, INCORPORATED,

                                         Plaintiff-Appellee,

versus

THE KNR GROUP, INCORPORATED; ET AL.,

                                         Defendants,

KEITH ROYSTER, Individually and
doing business as KNR Group, Incorporated,

                                         Defendant-Appellant.

                      --------------------
          Appeal from the United States District Court
               for the Southern District of Texas
                      USDC No. G-98-CV-535
                      --------------------
                          May 19, 2000

Before KING, Chief Judge, and HIGGINBOTHAM and STEWART, Circuit
Judges.

PER CURIAM:*

     Keith Royster, individually and doing business as KNR Group,

Inc., appeals from the default judgment in favor of Ann Best

Elite Temporaries, Inc. (ABET) in a dispute regarding an alleged

breach of contract.   He contends that the district court erred in

     *
        Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
                            No. 99-41263
                                 -2-

entering the default judgment because his failure to appear at a

court-ordered mediation conference, his own deposition, and at

docket call was due, not to intransigence, but rather to

financial inability.    Royster explains that he is a resident of

Florida and cannot afford the expense of traveling to the

Southern District of Texas, where this suit was brought.

     The decision to strike a party’s pleadings and enter default

judgment is a matter within the district court’s discretion and

is reviewed only for an abuse of that discretion.    Smith v.

Smith, 145 F.3d 335, 343-44 (5th Cir. 1998).    Because it is such

a drastic remedy, default judgment is a disfavored means of

resolving a controversy.    Lindsey v. Prive Corp., 161 F.3d 886,

893 (5th Cir. 1998).    The power to impose a default judgment is

thus to be exercised judiciously and never “when it has been

established that failure to comply has been due to inability, and

not to wilfulness, bad faith, or any fault of (the non-complying

party).”    Wilson v. Volkswagen of America, Inc., 561 F.2d 494,

503 (5th Cir. 1977) (internal citation and quotation marks

omitted).    Nor should a default be entered when a less drastic

sanction would suffice.    See Smith, 145 F.3d at 344.

     The district court abused its discretion in resorting to

default judgment as a sanction for Royster’s dereliction of this

action.    Royster’s letter apprised the district court that his

failure to appear for various pretrial matters, the sole

justification offered by the district court for levying the

sanction, was due, not to a wilful disregard for his

responsibilities, but rather to financial privation.     See Wilson,
                           No. 99-41263
                                -3-

561 F.2d at 503.   The plaintiffs did not challenge Royster’s

allegation of financial hardship.   Moreover, the record does not

show that the district court considered whether any lesser

sanction would have sufficed under the circumstances.   See Smith,

145 F.3d at 344.   Lastly, the default judgment resulted in a

substantial monetary judgment being entered against Royster.     See

Prive Corp., 161 F.3d at 893.

     Upon remand, the district court is free either to consider

whether any lesser sanction would achieve the ends of justice or

to articulate the rationale underpinning its belief that default

was the only appropriate remedy under the circumstances.   The

district court should also consider whether sanctions can be

eschewed entirely by addressing the fundamental problem of

Royster’s alleged inability to travel to the Southern District of

Texas.   In this regard, the district court may wish to consider

ordering that the mediation conference and Royster’s deposition

be conducted by phone or that pretrial discovery be achieved

through interrogatories or any means other than an in-person

deposition.

     REVERSED and REMANDED.