Lead Opinion
delivered the opinion of the Court,
In this case, we consider whether the excuse offered by defendants for failing to answer a lawsuit timely is sufficient to satisfy the first element of the Craddock test for setting aside a no-answer default judgment; ie., that the failure to appear was not intentional or the result of conscious indifference but was the result of a mistake or an accident.
I
Robert Spencer contracted with Southern Customs Paint and Body to paint and perform a frame-off restoration on his 1965 Chevrolet Corvette for $7,500. Spencer alleged that when he went to pick up his car five months later, he found that the work was incomplete and that irreplaceable parts and pieces of the vehicle were missing. In accordance with the notice provision of the Deceptive Trade Practices Act (DTPA), Spencer sent Southern
A year later, Spencer brought a DTPA suit against Southern Customs for violating the terms of the automobile repair service contract. Spencer complained of an incomplete and inadequate paint job on his Corvette, lost car parts, and false representations regarding the time and cost for completing the work. Through a process server, Spencer served all three named defendants with citations. One citation named “Jesse Garza” as the defendant for service, but the return stated that the citation was served on “Jesse De La Garza.” Another citation named “Southern Customs Paint and Body” as a defendant, while the return stated the citation was served on “Southern Custom’s by delivering to Robert Sutherland.” De La Garza pointed out the citation’s error in his name to the process server, who then offered to take the citation back to correct the mistake. De La Garza declined that offer and told the process server that regardless of the error, he knew he was the person being sued and to leave the documents with him.
Southern Customs failed to file a timely answer. Spencer obtained a default judgment that awarded him nearly $150,000, which included the trebling of Spencer’s economic and mental anguish damages due to alleged intentional conduct under the DTPA, as well as attorney’s fees.
Southern Customs filed a timely motion for new trial, arguing that service on De La Garza was improper, and that Southern Customs established the necessary Craddock elements to set aside the default judgment. Under Craddock, a trial court is required to set aside a default judgment if (1) “the failure of the defendant to answer before judgment was not intentional, or the result of conscious indifference on his part, but was due to a mistake or an accident”; (2) “the motion for a new trial sets up a meritorious defense”; and (3) granting the motion “will occasion no delay or otherwise work an injury to the plaintiff.” Craddock,
II
Southern Customs asserts that service of process was invalid because one of the citations misstated the name of Jesse De La Garza and the return on the other citation did not show proper service on Southern Customs Paint and Body. Southern Customs states that “[tjhere are no presumptions in favor of valid issuance, service, and return of citation,” citing Fidelity & Guaranty Insurance Co. v. Drewery Construction Co.,
A defendant satisfies its burden as to the first Craddock element when its factual assertions, if true, negate intentional or consciously indifferent conduct by the defendant and the factual assertions are not controverted by the plaintiff. In re R.R.,
Contrary to the dissent’s assertion, this decision does not alter our default judgment jurisprudence. We do not hold that forgetfulness alone is sufficient to satisfy the first Craddock element; rather, we simply conclude that the excuse presented here is so similar to that which we accepted as sufficient in Craddock that the same result is required. Southern Customs provided some excuse for its oversight, which satisfies the first element of Craddock. In Craddock, weather conditions altered a company’s ordinary course of business, which ultimately led to the misplacement of a citation among less urgent mail and the failure to answer the lawsuit before judgment. Id. at 125. Similarly, weather conditions were alleged in this case to have altered the ordinary course of business for Southern Customs, ultimately leading Sutherland and De La Garza to misplace the citations in a pile of ordinary papers and to fail to answer the lawsuit before judgment.
Ill
Southern Customs provided a sufficient excuse for failing to answer the suit timely, thus satisfying the first element of the Craddock standard. The trial court’s denial of Southern Customs’s motion for new trial, therefore, cannot be affirmed on the ground that its excuse for not answering was insufficient. The court of appeals erred when it held otherwise. Accordingly, we grant the petition for review and, without hearing oral argument, we reverse the court of appeals’ judgment and remand the case to that court for consideration of the second and third Craddock elements. Tex.R.App. P. 59.1.
Notes
. The style of this case initially reflected the parties as they were originally named in the trial court, including "Jesse Garza.” Because De La Garza’s briefing in this Court refers to him as "Jesus De La Garza,” which is consistent with his affidavit filed in the trial court, we have corrected the case style to reflect what we believe is his legal name. There is no dispute that these names, as well as "Jesse De La Garza” and "Jesse de la Garza,” refer to the samé person.
. Sutherland’s and De La Garza's uncontro-verted affidavits each state:
Dissenting Opinion
joined by Justice WILLETT, dissenting.
“I forgot.”
We reject this excuse when tax returns are late, or when homework is missing, but a defendant can now use it to disregard an official directive by the State of Texas that he either answer a lawsuit or risk a judgment against him. The defendants here received and reviewed the citation and petition, placed the papers on their office desk, stopped thinking about the lawsuit because of the holidays and “weather conditions,” and ultimately forgot about it. If those facts constitute a sufficient excuse for neglecting to answer a lawsuit, the rules and precedent governing default judgments have been displaced by a simple command: no default judgment will stand if the defendant asserts that the mundane distractions of everyday life destroyed his cognition.
Because we prefer a merits determination to a procedural forfeit, we have been reluctant to uphold a default judgment if it is clear that the defendant intended to answer the lawsuit. See Holt Atherton Indus. v. Heine,
Our precedent and rules have warned about the risk of default for more than a century. It functions primarily to spur quick action when a defendant is served with a lawsuit. Our legal system is built around deadlines. Deadlines ensure the orderly process of litigation. Statutes of limitations force the plaintiff to act, and the risk of default induces the defendant to answer. See, e.g., 10A ChaRles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 2681, at 9 (3d ed.1998) (“[T]he possibility of being held in default acts as a deterrent to those parties resorting to delay as an element of their litigation strategy.”). If that tool is to have any effect, and the rule of law any meaning, it must be enforced. Cf. Edwards Aquifer Auth. v. Chem. Lime, Ltd.,
Long ago, having taken all of these considerations into account, we announced that a default judgment should be set aside if the defendant can establish certain benchmarks:
A default judgment should be set aside and a new trial ordered in any case in which the failure of the defendant to answer before judgment was not intentional, or the result of conscious indifference on his part, but was due to a mistake or an accident; provided the motion for a new trial sets up a meritorious defense and is filed at a time when the granting thereof will occasion no delay or otherwise work an injury to the plaintiff.
Craddock v. Sunshine Bus Lines, Inc.,
We have had many occasions to describe how a defendant can show that the failure to answer was neither intentional nor the result of conscious indifference. Conscious indifference means “that the defendant knew it was sued but did not care.” Fidelity & Guar. Ins. Co. v. Drewery Constr. Co.,
We recently held “that some excuse, although not necessarily a good one, will suffice to show that a defendant’s failure to file an answer was not because the defendant did not care.” In re R.R.,
• Not receiving the citation is always a sufficient excuse for not answering. See, e.g., Estate of Pollack v. McMurrey,
• Losing the service papers can be a sufficient excuse if it is “supported by some explanation from the person most likely to have seen them, or of the efforts made to find them.” Fidelity,
• Misplacing the citation is sufficient when it is the result of a turnover in staff or a breakdown in communication. See, e.g., Dir., State Emp. Workers’ Comp. Div. v. Evans,
• Some mistakes of law suffice if the mistake is the result of a defendant’s prior interactions with the law. See, e.g., In re R.R.,
This list is not exhaustive, but it is a useful point of reference when analyzing a default judgment. None of these cases, however, address the type of excuse presented in this case. Both De La Garza and Sutherland explain their failure to answer as follows:
I remember someone coming to my shop on or about December 19, 2008, and leaving some papers with me and my partner. This was a Friday. The person who gave the papers to me did not explain what they were for or that I had any obligation to do anything in response. I had never been sued before like this and have no experience with the legal system. I briefly reviewed the papers and the[n] placed them on a desk in my office. My desk is covered in papers, concerning various matters. We do not employ a secretary or have any administrative help. My partner and I do everything. When we received the papers, it was less than a week before the Christmas holidays. The weather conditions during this period made it difficult for me to perform much labor for any customers because weather conditions adversely affect paint work on automobiles. I did return to the shop on Monday and worked part of the day. However, the work was limited to mostly returning automobiles to customers. I spent little time in my office. I also worked briefly on Tuesday, December 23, 2008, again, just returning automobiles and scheduling work. By this time, and due, in part, to the holidays, I was not thinking about the papers that had been delivered to me at my shop. The papers had been placed on my desk but were not on my mind and were camouflaged with other papers;
I did not return to the shop again after Décember 23, 2008, until January 5, 2009. During this period, the shop was closed for the holidays and, in part, because of the weather conditions. I also spent a lot of time during this period in San Antonio, Texas, to visit friends for the holidays. Also during this period, my thoughts were on the holidays and things I had to do to plan and prepare for the holidays. Therefore, my thoughts were not on the papers that had been delivered to me;
Between January 5, 2009, and January 16, 2009,1 resumed a regular schedule at the shop. During this period,'I was working and not thinking about the papers that had been delivered to me. In fact, by this time, I had forgotten that [sic] about them. I also did not understand or realize that I had any obligation to do anything, including filing an answer to the papers within any time period. This was clearly a mistake on my part;
I now understand that a default judgment was entered because an answer- to the suit was not filed within the time allowed. My failure to review the documents and understand what they must have been was an accident or mistake by me because I did not understand the significance of the documents and even failed to remember that I had gotten*760 them. Further, the papers were given to me during the Christmas and New Year’s holiday period, when my mind was focused elsewhere and not on the papers. I have never been sued before. Nor did I consciously disregard answering the suit because I did not even realize that the papers that had been delivered required any attention by me. Had I realized what the documents must have been, I would have immediately retained the services of an attorney to represent me, as I did as soon as I received notice of the default judgment. The notice received by me in the mail was the first indication that I had that a lawsuit had been filed against me that required affirmative action by me.1
This excuse cannot suffice. The defendants did not lose the citation. They knew where it was. De La Garza placed it on his desk upon receipt. Cf. Fidelity,
This case is distinct from Craddock, where inclement weather caused the defendant to misplace the citation. There, an insurance company fell behind in its work because of an influx of claims due to a recent hail and wind storm. Craddock,
In this case, the affidavits obliquely speak of “weather conditions.” There is no assertion that the weather impeded access to the courthouse, precluded the retention of a lawyer, or (as in Craddock) overburdened the defendants’ business with an influx of work. Indeed, according to the affidavits, the defendants had more time on their hands as business subsided due to the weather.
That leaves “the holidays.” We are lenient when deadlines fall on legal holidays. See Tex.R. Civ. P. 4. But the rules nevertheless require that litigants answer lawsuits, request a jury, move for new trial, perfect an appeal — all within prescribed time limits and even when holidays intervene. In any event, the defendants offer no particular reason why the holidays prevented them from answering the lawsuit. Rather, they assert that their minds were preoccupied by the holidays, to the exclusion of the lawsuit. Consequently, this case comes down to one proposition: that a defendant who says he forgot about being sued is not indifferent to the risk of default.
(1) on June 18, three days after being served, Prewitt called Mr. Bentley and asked if Bentley would represent him in the suit. He was advised by Bentley that he would do so if the papers in the case were forwarded to him; (2) Prewitt then instructed Julie Miracle to gather all of the documents pertaining to the Strackbein matter; (3) on June 23, after the documents had been assembled, Prewitt again called Bentley’s office and talked with a secretary who advised him that Bentley was out of town but that he should mail the documents to her so that the matter could be timely handled; (4) Prewitt then instructed Julie Miracle to mail the documents to Bentley’s office; (5) however, due to a breakdown of communication, Julie Miracle thought Prew-itt was going to mail the documents and Prewitt thought Julie Miracle would mail them; (6) instead, the papers were misplaced in the office and were not discovered until Prewitt received notice of default; and (7) until that time, Prew-itt believed that the papers were in the attorney’s office and that the suit was being handled by the attorney.
Id. at 39. Based on the affidavit, we concluded that “there [was] no reasonable interpretation ... which would constitute evidence that Prewitt’s failure to answer the citation was a result of an intentional act or conscious indifference.” Id. Prewitt twice contacted an attorney and took steps to answer the lawsuit. De La Garza and Sutherland, by contrast, reviewed the citation, put it on a desk, and focused their attention elsewhere — the holidays, work, visiting friends. These actions do not negate conscious indifference — they establish it. See Fidelity,
We will one day see a case in which a defendant served with citation is so overwhelmed with events that a trial judge exercises sound discretion to order a new trial. In this case, however, the period from the defendants’ receipt of the citation to notice of the default is marked with contempt for their obligation to the rule of law. The trial court was not required to accept the defendants’ excuse on these facts. Because the Court holds otherwise, I respectfully dissent.
. The only difference between the excuse provided in De La Garza’s affidavit and Sutherland’s affidavit is that Sutherland’s does not contain the sentence: "I also spent a lot of time during this period in San Antonio, Texas, to visit friends for the holidays.”
