Court Opinion

ID: 4298053
Source: CourtListenerOpinion
Date Created: 2018-07-26 16:00:31.61132+00
Date Added: 2024-06-11T14:41:15.227806
License: Public Domain

Case: 17-11634   Date Filed: 07/26/2018   Page: 1 of 8

                                                         [DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                             No. 17-11634
                         Non-Argument Calendar
                       ________________________

                  D.C. Docket No. 1:15-cv-24749-KMW

PETER SZANTO,

                                                           Plaintiff-Appellant,

                                  versus

JOSEPH M. BISTRITZ,

                                                          Defendant-Appellee.

                       ________________________

                Appeal from the United States District Court
                    for the Southern District of Florida
                      ________________________

                              (July 26, 2018)

Before TJOFLAT, NEWSOM, and EDMONDSON, Circuit Judges.
               Case: 17-11634     Date Filed: 07/26/2018    Page: 2 of 8

PER CURIAM:

      Plaintiff Peter Szanto, proceeding pro se, appeals the district court’s sua

sponte dismissal with prejudice of his complaint against Defendant Joseph Bistritz.

Reversible error has been shown; we vacate the dismissal and remand for further

proceedings.

      Briefly stated, this civil diversity action arises from a dispute over a

residential lease for real property owned by Defendant. Plaintiff asserted against

Defendant state law claims for breach of contract, fraud, and conversion/civil theft.

On 25 January 2017, the parties entered into a mediated settlement agreement;

pursuant to the agreement, Defendant agreed to pay Plaintiff $10,750 in exchange

for a general release of all claims and dismissal of this case.

      On 27 January, the district court ordered the parties to file a joint stipulation

of dismissal on or before 13 February 2017. When the parties failed to do so, the

district court ordered the parties to show cause “as to why sanctions should not be

imposed and the case should not be dismissed with prejudice for failure to comply

with a Court Order.”

      Plaintiff thereafter moved for entry of judgment and for sanctions, asserting

that Defendant breached the settlement agreement by failing to pay timely the

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agreed-upon settlement amount. Defendant responded that he had attempted to

disburse the settlement funds via both wire transfer and mail but that his attempts

were unsuccessful because Plaintiff had failed to provide a valid bank account

number or physical mailing address. Defendant also sought sanctions for costs

incurred.

      On 21 February 2017, the district court issued an order (1) denying the

parties’ motions for sanctions and for costs; (2) directing Plaintiff to provide

Defendant with either a mailing address or a valid bank account number to

facilitate delivery of the settlement funds; and (3) requiring the parties to file a

joint stipulation of dismissal on or before 8 March. The district court warned that

failure to comply with the order “will result in dismissal of this case.”

      Plaintiff then filed a second motion for entry of judgment and for sanctions;

Defendant also moved a second time for sanctions for costs.

      On 7 March 2017, the district court denied again the parties’ motions and

prohibited the parties from filing additional motions for sanctions. The district

court also ordered (1) Defendant, on or before 9 March, to file a copy of the

settlement check and proof of mailing the check to Plaintiff; (2) Defendant, on or

before 14 March, to file proof of Plaintiff’s receipt of the check; and (3) the parties,

on or before 17 March, to file a joint stipulation of dismissal. The district court

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warned that failure to comply with the court’s order “will result in monetary

sanctions . . . and immediate dismissal of this case.”

      On 9 March 2017, Defendant filed a notice of compliance, stating he had

mailed a settlement check to Plaintiff’s address-of-record and attached copies of

the check and proof of mailing. On 14 March, Defendant filed a second notice of

compliance, stating Plaintiff had signed for the check on 14 March. On 17 March,

Defendant filed a “unilateral stipulation” for dismissal, explaining that Plaintiff had

been unresponsive to attempts to communicate about a joint stipulation.

      Meanwhile, Plaintiff filed a third motion for entry of judgment, asserting

that, although he received and signed for a letter on 14 March, the enveloped

contained no settlement check.

      On 27 March 2017, the district court issued an order dismissing the case.

The district court explained its ruling this way:

      The Court has twice attempted to help the Parties successfully
      complete the transfer of the settlement funds, and has twice warned
      the Parties that failure to adhere to the Court’s instructions would
      result in dismissal of this case. It is not clear to the Court why
      completing the transfer has been so difficult or why its orders have
      been so consistently ignored. Nevertheless, and in light of the fact
      that the settlement agreement contains no language about retention of
      jurisdiction, the Court finds that litigation of all claims properly
      before it have concluded, and therefore finds that dismissal is
      appropriate. Though the Parties are free to enforce their rights under
      the settlement agreement in whatever way they deem appropriate, any

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      disputes regarding a purported breach of the settlement agreement is
      not a part of this litigation.

      Whether the district court dismissed this case for lack of jurisdiction or as a

sanction for failure to comply with the court’s orders is unclear; so we address both

grounds.

      We review de novo questions about the district court’s subject matter

jurisdiction. Miccosukee Tribe of Indians of Fla. v. United States Army Corps of

Eng’rs, 619 F.3d 1289, 1296 (11th Cir. 2010). A district court retains “jurisdiction

to enforce a settlement agreement when . . . a party claims a breach of the

settlement agreement before the court has dismissed the action.” Kent v. Baker,

815 F.2d 1395, 1396 (11th Cir. 1987) (vacating the district court’s dismissal for

lack of jurisdiction to enforce a settlement agreement). Under the circumstances of

this case -- where the parties entered into a settlement agreement and then alleged a

breach of the agreement before dismissal -- the district court retained jurisdiction

to enforce the terms of the settlement agreement. The district court thus erred to

the extent it dismissed the case for lack of jurisdiction.

      We next address whether dismissal was proper for failure to comply with the

district court’s orders. We often write that we review the district court’s dismissal

for failure to comply with court orders under an abuse-of-discretion standard.

Betty K Agencies, Ltd. v. M/V MONADA, 432 F.3d 1333, 1337 (11th Cir. 2005).

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And we say we will affirm unless we conclude that the district court made a clear

error of judgment or misapplied the law. Guideone Elite Ins. Co. v. Old Cutler

Presbyterian Church, Inc., 420 F.3d 1317, 1325 (11th Cir. 2005). Nevertheless,

our decisions do not favor the sanction of dismissal.

      A district court may dismiss sua sponte an action for failure to comply with

a court order either under Federal Rule of Civil Procedure 41(b) or under the

court’s inherent authority. Betty K Agencies, Ltd., 432 F.3d at 1337. Unless the

court’s dismissal order says otherwise, such a dismissal operates as an adjudication

on the merits. Fed. R. Civ. P. 41(b); see Costello v. United States, 365 U.S. 265,

286-87 (1961).

      Dismissal with prejudice “is an extreme sanction that may be properly

imposed only when: (1) a party engages in a clear pattern of delay or willful

contempt (contumacious conduct); and (2) the district court specifically finds that

lesser sanctions would not suffice.” Betty K Agencies, Ltd., 432 F.3d at 1337-38

(emphasis in original) (quotations omitted).

      Although the district court failed to specify whether dismissal was with or

without prejudice, the sua sponte dismissal for failure to comply with the court’s

orders operated as an adjudication on the merits. The district court was thus

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required to make findings that the parties had engaged in a clear pattern of delay or

willful contempt and that lesser sanctions would not suffice.

      In its order of dismissal, the district court made no express finding that the

parties had engaged in a clear pattern of delay or willful contempt. The district

court did, however, summarize the timeline of events leading up to the dismissal,

including the parties’ repeated failure to comply with the court’s orders. The

district court also described the parties’ ongoing communication issues and

motions for sanctions. We thus conclude that the district court did make an

implicit finding that the parties, at the least, engaged in a clear pattern of delay.

      The district court, however, made no findings -- either explicit or implicit --

that lesser sanctions were inadequate to correct the parties’ conduct. Nor does the

record demonstrate that lesser sanctions (such as monetary sanctions or dismissal

without prejudice) would not have sufficed. Although the district court mentioned

the possibility of monetary sanctions in its 7 March order, it imposed no monetary

sanctions or other less drastic sanctions before dismissing the case with prejudice.

      Our precedent is not loose when it comes to these dismissals. Under the

precedent, we conclude that the district court committed a clear abuse of discretion

in dismissing the case with prejudice without first making the necessary findings to

support that dismissal. See Betty K Agencies, Ltd., 432 F.3d at 1338-40 (“Our

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case law has articulated with crystalline clarity the outer boundary of the district

court’s discretion in these matters: dismissal with prejudice is plainly improper

unless and until the district court finds a clear record of delay or willful conduct

and that lesser sanctions are inadequate to correct such conduct.”). Overcome by

precedent, we vacate the dismissal order and remand for further proceedings.

      Plaintiff requests this case be reassigned to a different district court judge on

remand. Although we have the authority to reassign cases on remand, we consider

doing so a “severe remedy.” Stargel v. SunTrust Banks., Inc., 791 F.3d 1309,

1311(11th Cir. 2015). In deciding whether reassignment is necessary, we consider

three factors: “(1) whether the original judge would have difficulty putting his

previous views and findings aside; (2) whether reassignment is appropriate to

preserve the appearance of justice; [and] (3) whether reassignment would entail

waste and duplication out of proportion to the gains realized from reassignment.”

Id. at 1311-12 (quotations omitted). Having considered these factors, we are

unpersuaded that reassignment is warranted in this case.

      VACATED AND REMANDED.

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