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September 26, 2019 by Jeremy N. NashDownload PDF


Defaults and Default Judgments in the Federal CourtsJeremy N. Nash

What “Default Judgment” Means

A “default judgment” is the kind of judgment generally entered in cases where one party fails to show up to defend a lawsuit.

Its meaning comes from the Federal Rules of Civil Procedure. The Rules define “default” as when “a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend,” and define “judgment” as “a decree and any order from which an appeal lies.” Read together, a default judgment is simply any judgment that results from a default.

Courts typically enter default judgments in favor of the plaintiffs in cases where the defendants did not respond to the complaint. Shortly after a complaint is filed, the defendant is supposed to respond to the complaint by submitting an answer or by filing a motion to dismiss. If the defendant does neither of those things, it risks entry of default and default judgment.

The Difference Between “Default” and “Default Judgment”

The entry of a default and entry of a default judgment are two different things.

Obtaining a default judgment is a two-step process that begins with asking the clerk of the court to enter the default. This is a ministerial act of the court clerk that formally establishes that a party is in default. Once in default, a party is no longer able to answer the complaint or otherwise respond to the complaint.

The second step is asking for entry of a judgment that awards the relief sought in the complaint. This can be done in one of two ways. The party seeking the default judgment can apply to the clerk of the court for entry of a default judgment. Otherwise, the request must be made by motion to the district court judge.

Another difference between defaults and default judgments is in how difficult they are to have set aside. The relevant rules use the same language to describe the standard – “good cause” – but the courts interpret them differently for requests to vacate entry of default and to vacate a default judgment. The standard for setting aside entry default is lower and thus easier to achieve.

How to Request Entry of Default

Requesting an entry of default typically involves filing the following two documents with the court clerk:

• Request for Default
• Supporting Affidavit
 
The Request for Default sets forth the request for the court clerk to enter the default of the party who has not answered the complaint or otherwise defended the action within the time required by the rules or as extended by court order.
 
The Supporting Affidavit sets forth the basis for the entry of default. It should include the date of service of the summons and complaint, the failure of the defaulting party to file a motion or serve a responsive pleading, and the absence of an extension of time to respond. Unless it was already filed, a copy of the proof of service of the summons and complaint should be attached as an exhibit in support of the request for entry of default.

How to Apply to the Clerk for Default Judgment

Motions for Default Judgment are more complex than Requests for Default for several reasons, the first being that in some instances they must be made to the presiding district court judge and in others may be made to the clerk of the court.

Applications for Default Judgment may be made to the clerk in only the following limited circumstances:

• Plaintiff’s claim must be for a sum certain.
• The defendant must not have appeared or otherwise participated in the action.
• The defendant must not be an infant or incompetent.
• The defendant must not be the United States or member of the armed forces.
• If there are multiple defendants, all must be in default.
 
 
The “sum certain” limitation is the most common impediment to applying directly to the clerk for a default judgment. It excludes many forms of relief commonly sought in civil litigation including, for example, injunctive and declaratory relief, unliquidated damages, punitive damages, attorneys’ fees, and prejudgment interest.

In cases where all the above criteria are satisfied, the application for default judgment consists of the following three or four documents:
 
• Supporting Affidavit
• Proposed Form of Default Judgment
• Bill of Costs and Disbursements
• Affidavit of Nonmilitary Service

The Supporting Affidavit should establish the basic requirements of the relevant Rule, which are (1) the entry of default by the clerk, (2) the failure of the defaulting party to appear, (3) that the defaulting party is neither an infant nor incompetent, and (4) the “sum certain” of damages being asserted and how those damages are calculated.

The Proposed Form of Default Judgment should reiterate those basic requirements and the Bill of Costs and Disbursements should set forth all costs other than attorneys’ fees unless a statute, the Rules, or court order provides that such costs are not available. In cases where the defaulting party is an individual, the application must also include the Affidavit of Nonmilitary Service and supporting certifications from the various military services.

If all the requirements of the relevant Rules have been satisfied, the clerk will enter the default judgment against the defaulting party.

Motions Before District Court Judges for Default Judgment

District court judges have authority to enter a default judgment against a party in default on their own initiative or in response to a motion filed by the nondefaulting party.

Like applications to the clerk, motions for a default judgment must be supported by evidence establishing the requirements of the relevant Rules and the amount of damages requested.

Unlike applications to a clerk, however, motions for a default judgment may be denied even if the movant has complied with the technical requirements of the Rules. That is because motions for default judgment are discretionary and subject to a range of considerations that may impact the outcome. For example, if the party in default filed an appearance, the Rules require that the movant provide the defaulting party with at least seven days’ notice of the motion. Special weight is given to the notice requirement in such circumstances.

If the motion is granted, the district court makes the findings of fact required by the Rules, and the court directs the clerk to enter judgment, it generally becomes final and binding on the defaulting party.

Requesting Relief from Entry of Default or a Default Judgment

The Rules allow for relief from an entry of default or a default judgment for “good cause.”

Making the “good cause” showing is more difficult with respect to default judgments than it is for entries of default, but the courts disfavor defaults and so any doubts about the propriety of a default are generally resolved in favor of setting it aside.

There are too many possible grounds for setting aside a default to list them all. Common reasons to set aside a default are that it was not properly entered in the first instance or because the party obtaining the default judgment failed to meet an express requirement of the rule, such as proper service of the complaint or notice of the motion for default judgment.

In considering whether to grant a motion to vacate a default, district courts also consider four factors that are set forth in the Rules:

• Whether the plaintiff would be prejudiced by setting the default aside.
• Whether the defendant has a meritorious defense.
• Whether the default was the result of the defendant’s culpable conduct.
• The effectiveness of alternative sanctions.
 
A party moving to vacate an entry of default or a default judgment should submit an affidavit explaining the reasons for the default. Given the above factors, the affidavit should also set forth the factual and legal basis for all defenses and any facts concerning the parties’ good faith and culpability. In addition, any motion to vacate should include a request to serve and file an answer to the complaint, as well as the proposed answer. Motions to set aside a default that contain mere denials or assert defenses in a conclusory fashion without a reasonable description of the surrounding facts will likely be given little weight.

Lite DePalma Greenberg, LLC appellate attorneys are familiar with the default rules and have handled numerous appeals, in both the federal and state courts. For more information on Lite DePalma’s appellate practice, please visit www.litedepalma.com/appellate.