Court Opinion

ID: 8208699
Source: CourtListenerOpinion
Date Created: 2022-09-23 13:02:58.529023+00
Date Added: 2024-06-11T16:41:34.453720
License: Public Domain

DISTRICT COURT OF APPEAL OF FLORIDA
                       SECOND DISTRICT

      ALL MY SONS MOVING & STORAGE OF SOUTHWEST
    FLORIDA, INC. d/b/a ALL MY SONS MOVING & STORAGE,

                              Appellant,

                                  v.

                   A & E TRUCK SERVICE, LLC,

                              Appellee.

                           No. 2D21-3667

                        September 23, 2022

Appeal pursuant to Fla. R. App. P. 9.130 from the County Court
for Lee County; Erik Leontiev, Judge.

Steven Dubberly of Dubberly, P.A., Aventura, for Appellant.

Ashley Segal and Gordon R. Duncan of Duncan & Associates, P.A.,
Fort Myers, for Appellee.

ROTHSTEIN-YOUAKIM, Judge.

     All My Sons Moving & Storage of Southwest Florida, Inc. (AMS)

appeals the trial court's order denying its motion under Florida Rule

of Civil Procedure 1.540(b) to set aside the default final judgment.

Because AMS established excusable neglect, identified meritorious

defenses, and moved diligently to vacate the default, we reverse.
     A & E Truck Service, LLC (A & E) brought a three-count action

against AMS for failure to pay for truck repairs. Count one alleged

a worthless instrument claim under section 68.065, Florida

Statutes (2019).1 On that count, A & E sought treble damages,

attorney's fees and a service charge as permitted by statute, and

costs.

     A process server served an AMS sales associate with the

summons and complaint in May 2020.2 After AMS failed to answer,

A & E moved for a clerk's default. The motion lacked a certificate of

service.

     Having been granted a clerk's default, A & E thereafter moved

for a default final judgment on count one. A & E certified service of

this motion on AMS, but according to an affidavit later filed by

     1 A & E has dismissed the two other counts, and they are not
pertinent to this appeal.

     2  The return of service identified the sales associate as the
"office administrator" for Linda Dubberly, who is the president and
registered agent of AMS, and the process server's affidavit, which
A & E filed with the trial court, averred that the associate had
identified herself to the process server as such. Nothing in
Dubberly's affidavit or the sales associate's deposition, however,
suggests that she held anything other than an entry-level sales
position.

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Dubberly, "either AMS never received any court documents, the

documents were misplaced with other unrelated documents and

possibly thrown out, or the documents were not properly forwarded

to [Dubberly's] attention."

     The trial court entered default final judgment on count one on

August 5, 2020, in the full amount requested by A & E, including

treble damages. Then, on August 10, 2020, counsel for AMS

appeared and moved to set aside the default. With its motion, AMS

submitted an affidavit from Dubberly, who averred that she had

been out of the office since the beginning of the pandemic because

particular health concerns made her more vulnerable to COVID-19;

that she had first learned of the lawsuit on August 10, when a

member of her staff (whom she later identified as one of the

managers) had notified her that AMS had received a copy of the

default judgment in the mail; and that upon investigation, she had

discovered that court documents had not been properly forwarded

to her attention by "newly hired office staff." A & E opposed AMS's

motion.

     After the trial court denied without prejudice its first motion to

set aside the default, AMS promptly filed a second motion. AMS

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noted that A & E had not alleged in its complaint the "intent to

defraud" element of a worthless instrument claim. AMS also

submitted a more detailed affidavit by Dubberly, who reiterated that

she had first learned of the lawsuit on August 10, 2020. She

averred further that AMS's policy is to forward all court documents

to her attention: before the pandemic, managers typically placed

important documents in her incoming mail file, but because she

was now working exclusively from home, managers were instead

supposed to email documents to her. She averred that if the sales

associate who had accepted service had followed proper procedure,

the associate would have forwarded a copy of the summons and

complaint to a manager who would have forwarded it to her, but

her investigation revealed that the policy for forwarding documents

to her had not been followed.

     Dubberly also averred that AMS had stopped payment on the

check to A & E because AMS had learned that A & E had not

performed the promised repairs but had still charged AMS for them.

AMS had been compelled to take the truck—which still did not run

properly—to another mechanic.

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     A & E deposed the sales associate and filed a transcript of her

deposition with the trial court in support of its opposition to AMS's

second motion. During the deposition, the associate testified,

among other things, that she had been working for AMS since June

2019; that she did not recall having been served with the summons

and complaint; that only the "owners" (referring to Dubberly and

her husband, Kevin Dubberly) have access to the mail; and that

neither "owner" had come into the office since the pandemic started,

although Kevin Dubberly used to be there every weekday from 9:00

a.m. to 5:00 p.m. Although the associate also testified that she had

not been trained specifically on "how to handle court documents if

they were delivered to the office," she did not dispute that AMS's

policy was that important documents were supposed to be

forwarded to Dubberly. A & E also filed affidavits from the process

server, who averred that the associate had accepted service of the

summons and complaint, and from the paralegal who assertedly

had mailed A & E's motion for default final judgment to AMS.

     After hearing argument, the trial court denied AMS's second

motion to set aside the default. Relying on the associate's

deposition testimony, the court found that both before and during

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the pandemic, AMS had suffered from chronic disorganization rising

to the level of "gross negligence." The court therefore concluded

that AMS had failed to establish excusable neglect.

                               Analysis

     Florida has "a strong preference for lawsuits to be determined

on the merits and [] courts should liberally set aside defaults under

appropriate circumstances." Geer v. Jacobsen, 880 So. 2d 717, 720

(Fla. 2d DCA 2004). "All reasonable doubts should be resolved in

favor of setting aside the default." Szucs v. Qualico Dev., Inc., 893

So. 2d 708, 710 (Fla. 2d DCA 2005) (citing Allstate Ins. Co. v.

Ladner, 740 So. 2d 42, 43 (Fla. 1st DCA 1999)). To set aside a

default judgment, a party must show excusable neglect and a

meritorious defense and must move diligently to vacate the default.

Canney v. Canney, 453 So. 2d 179, 181 (Fla. 2d DCA 1984).

     We readily conclude that AMS established excusable neglect.3

In her affidavit, Dubberly averred that AMS had an established

     3 We reject without discussion A & E's cursory argument that
AMS is precluded from establishing excusable neglect because it
assertedly violated section 48.091(2), Florida Statutes (2019). From
our limited record, it does not appear that A & E raised this
argument below or that any record was developed with respect to it.

                                   6
procedure for routing important documents and averred that it had

broken down in this instance. Nothing in the associate's deposition

contradicts these sworn statements. Furthermore, although the

record established that the usual routine at AMS was somewhat

disrupted by the pandemic, nothing in the record supports the trial

court's finding of chronic disorganization, let alone "gross

negligence," either before or during the pandemic.

     We have recognized several times that an isolated breakdown

in established procedures may constitute excusable neglect and

have little difficulty concluding that that authority applies here.

See, e.g., Mercury Marine Indus. v. Dillon, 779 So. 2d 356, 357 (Fla.

2d DCA 2000) (determining that losing or misplacing lawsuit papers

in a filing cabinet, despite a "usually reliable corporate procedure,"

constituted excusable neglect); Marshall Davis, Inc. v. Incapco, Inc.,

558 So. 2d 206, 207 (Fla. 2d DCA 1990) (holding that the failure of

an employee—for "unknown reasons"—to follow corporate policy for

handling court documents demonstrated excusable neglect); see

also S.B. Partners v. Holmes, 479 So. 2d 280, 282-83 (Fla. 2d DCA

In any event, the trial court did not identify it as a basis for its
ruling, and A & E cites no authority supporting it.

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1985) (holding that the misplacing of complaint by a disorganized

corporation may have shown "bureaucratic ineptitude" but still

constituted excusable neglect); cf. Otero v. Gov't Emps. Ins. Co., 606

So. 2d 443, 444 (Fla. 2d DCA 1992) (reversing the trial court's

finding of excusable neglect because GEICO wholly failed to

respond to "a continuing shower of legal proceedings naming it as

the defendant, including a notice of trial," over a nine-month period;

observing that "GEICO is not a mom-and-pop business confronted

by an occasional lawsuit" but "a large corporate entity whose

business includes engaging in litigation on a regular basis"; and

concluding that GEICO's inaction "clearly constitutes gross

negligence barring GEICO from relief").

     AMS also proved that it has meritorious defenses. The trial

court entered a default final judgment on a worthless instrument

claim without A & E ever having alleged in its complaint that AMS

intended to defraud A & E. But a plaintiff can only obtain damages

under section 68.065(3)(a) of the Florida Statutes if the "maker . . .

stops payment on the instrument with intent to defraud." See

Sanders Farm of Ocala, Inc. v. Bay Area Truck Sales, Inc., 235 So.

3d 1010, 1012–14 (Fla. 2d DCA 2017) (reversing summary

                                   8
judgment in favor of a plaintiff on a worthless instrument claim

because stopping payment on a check does not by itself establish

an "intent to defraud"). Moreover, AMS's president averred that

after tendering payment, AMS had learned that A & E had not

performed the repairs it had agreed to perform and that the repairs

that had been attempted had failed. AMS should be allowed the

opportunity to prove this. Cf., e.g., Sanders Farm of Ocala, 235 So.

3d at 1012-13 (holding that an issue of fact precluded summary

judgment on the "intent to defraud" element of a worthless

instrument claim when the truck repairs performed by plaintiff

exceeded the scope of defendant's authorization); Maung v. Nat'l

Stamping, LLC, 842 So. 2d 214, 216 (Fla. 3d DCA 2003) (reversing

summary judgment on the "intent to defraud" element of a

worthless instrument claim because the goods sold by the plaintiff

may have been counterfeit).

     Finally, AMS moved expeditiously to set aside the default. See

Coquina Beach Club Condo. Ass'n, v. Wagner, 813 So. 2d 1061,

1064 (Fla. 2d DCA 2002) (explaining that in evaluating whether a

party has exercised due diligence in moving to vacate a default

judgment, the court must consider the length of any delay and its

                                 9
reasons (citing Cinkat Transp., Inc. v. Maryland Cas. Co., 596 So. 2d

746, 747 (Fla. 3d DCA 1992))). Although the parties dispute

whether AMS ever received a service copy of the motion for default

judgment, it is undisputed that AMS moved to vacate the default

judgment the same day that Dubberly learned of it.

     Because AMS met its burden of establishing excusable neglect,

a meritorious defense, and due diligence, the trial court abused its

discretion in denying the motion to set aside the default final

judgment. We therefore reverse and remand for further proceedings

consistent with this opinion.

     Reversed and remanded.

NORTHCUTT and SILBERMAN, JJ., Concur.

Opinion subject to revision prior to official publication.

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