Maria Macias v. Drew Dillworth

Filing

Opinion issued by court as to Appellant Maria Macias. Decision: Affirmed. Opinion type: Non-Published. Opinion method: Per Curiam.

Case: 13-10336

Date Filed: 10/01/2013

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 13-10336
Non-Argument Calendar
________________________
D.C. Docket No. 1:12-cv-22590-KMM,
Bkcy No. 11-17890-AJC
In re: MARIA E. MACIAS,
Debtor.
____________________________________________
MARIA MACIAS,
Plaintiff - Appellant,
versus
DREW M. DILLWORTH,
Chapter 7 Trustee,
Defendant - Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(October 1, 2013)

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Before WILSON, MARTIN and ANDERSON, Circuit Judges.
PER CURIAM:
Maria Macias, the debtor in a Chapter 7 bankruptcy proceeding, appeals the
district court’s order affirming the bankruptcy court’s disposition of an adversary
proceeding brought by Drew Dillworth as trustee of Macias’s estate. After careful
review, we affirm.
I.
Macias filed for bankruptcy protection in March 2011, and the bankruptcy
court appointed Dillworth as trustee (the Trustee). On October 28 of that year, the
Trustee filed an adversary proceeding against Macias, contending she made a postpetition transfer to her husband of a tax refund she received in violation of 11
U.S.C. § 727(a). Three days later, the bankruptcy court clerk issued a summons to
Macias, requiring that she respond to the complaint within 30 days. Macias
received copies of the summons and complaint on November 19.
On December 1, because Macias had not responded, the Trustee filed a
motion for entry of default, which the clerk entered. On December 5, the Trustee
filed a motion for entry of default judgment, which the bankruptcy court granted
the following day. Also on December 5, however, Macias (then proceeding pro se)
filed a motion to dismiss the complaint. The motion was filed after the default
judgment was entered, so Macias filed a motion to vacate the judgment, arguing
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that, “prior to November 19th, 2011, [she] had no notification that a summons and
complaint had been filed against her.” The bankruptcy court convened a hearing
on the matter, where Macias argued she should not have been subject to a default
judgment because she answered within 30 days of receiving the summons, which
she thought was the appropriate deadline.
After the hearing, the bankruptcy court concluded Macias had presented
nothing that would legally entitle her to vacatur of the default judgment. Out of an
abundance of caution, however, the court offered to reconsider that conclusion if
(1) an attorney filed an appearance within 7 days on Macias’s behalf, presenting a
valid reason the claim should go to trial, and (2) the attorney was able to proceed to
trial within 14 days.
Rather than seeking trial-ready counsel, Macias filed a notice of appeal of
that order. She obtained counsel for her appeal to the district court and argued the
bankruptcy court should have granted the motion to vacate because she showed
“excusable neglect . . . .” Fed. R. Civ. P. 60(b)(1). 1 She also asserted the
bankruptcy court violated her right to proceed pro se when it required her to obtain

1

The Federal Rules of Bankruptcy Procedure incorporate Rule 60. See Fed. R. Bankr. P. 9024.
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counsel to go to trial. The district court upheld the bankruptcy court’s decision.
This is Macias’s appeal. 2
II.
“In a bankruptcy appeal, we sit as the second court of review of the
bankruptcy court’s judgment.” In re Piazza, 719 F.3d 1253, 1260 (11th Cir. 2013).
“Like the district court, we review a bankruptcy court’s findings of fact for clear
error and its conclusions of law de novo.” Id. Although Macias styled her motion
as a motion to vacate, the proper method for attacking a default judgment is by
way of a motion to set aside under Federal Rule of Civil Procedure 55(c). That
rule permits a court to set aside a default judgment for any reason listed in Rule
60(b), including “excusable neglect . . . .” Fed. R. Civ. P. 55(c), 60(b)(1). We
review the denial of a motion to set aside for an abuse of discretion. See Pioneer
Inv. Servs. Co. v. Brunswick Assocs. Ltd., 507 U.S. 380, 398, 113 S. Ct. 1489,
1500 (1993). This standard “requires us to affirm unless we find that the [trial]
court has made a clear error of judgment, or has applied the wrong legal standard.”

2

After the parties briefed the issues in this case, we issued a jurisdictional question, asking
whether the district court’s order affirming the bankruptcy court’s disposition of the motion to
vacate was an appealable decision. We conclude that we have jurisdiction to entertain Macias’s
appeal because the bankruptcy court’s order denying Macias’s motion to vacate became final
when the time period to fulfill the bankruptcy court’s conditions for continuing the case ended.
See Briehler v. City of Miami, 926 F.2d 1001, 1002 (11th Cir. 1991) (“[W]here an order
dismisses a complaint with leave to amend within a specified period, the order becomes final
(and therefore appealable) when the time period allowed for amendment expires.”).
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Robinson v. Tyson Foods, Inc., 595 F.3d 1269, 1273 (11th Cir. 2010) (internal
quotation marks omitted).
III.
Here, Macias first argues that the district court applied the wrong standard
for determining whether she showed excusable neglect. 3 “[F]or purposes of Rule
60(b), ‘excusable neglect’ is understood to encompass situations in which the
failure to comply with a filing deadline is attributable to negligence.” Pioneer Inv.
Servs. Co., 507 U.S. at 394, 113 S. Ct. at 1497. To establish excusable neglect, a
defaulting party must show: “(1) it had a meritorious defense that might have
affected the outcome; (2) granting the motion would not result in prejudice to the
non-defaulting party; and (3) a good reason existed for failing to reply to the
complaint.” In re Worldwide Web Sys., Inc., 328 F.3d 1291, 1295 (11th Cir.
2003) (internal quotation marks omitted). The test is, however, “at bottom an
equitable one, taking account of all relevant circumstances surrounding the party’s
omission.” Pioneer Inv. Servs., 507 U.S. at 395, 113 S. Ct. at 1498. “These
include . . . the danger of prejudice to the [non-movant], the length of delay and its

3

The Trustee contends Macias abandoned any argument that the default judgment should be
vacated for excusable neglect because she failed to make the argument before the bankruptcy
court. But Macias proceeded pro se in the bankruptcy court, so we liberally construe the
arguments she made. See Haines v. Kerner, 404 U.S. 519, 520, 92 S. Ct. 594, 596 (1972). True,
Macias did not cite Rule 60(b) in her motion to dismiss the Trustee’s complaint or during the
court’s hearing on her motion to vacate. She did, however, contend that her late filing was
excusable because she thought she was filing within the applicable 30-day time period. That
argument was sufficient to preserve the issue.
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potential impact on judicial proceedings, the reason for the delay, including
whether it was within the reasonable control of the movant, and whether the
movant acted in good faith.” Id.
Macias argues the bankruptcy court applied the test we set forth in In re
Worldwide Web Systems and improperly ignored the Supreme Court’s equitable
test established in Pioneer. She says the Pioneer test governs, and that she satisfied
that test because it contains no requirement that she assert a meritorious defense to
the adversary proceeding. But as we expressly acknowledged in In re Worldwide
Web Systems, Pioneer “d[id] not alter the fact that a determination of excusable
neglect is an equitable one that necessarily involves consideration of all three
elements—a meritorious defense, prejudice, and a good reason for not responding
to the complaint.” 328 F.3d at 1297. Rather, Pioneer simply emphasized the
importance of efficient judicial administration and the presence or absence of
prejudice to the nonmoving party. Id.; see Pioneer Inv. Servs., 507 U.S. at 395,
113 S. Ct. at 1498 (discussing relevant considerations).
In other words, our three-part test governs this case. 4 And the bankruptcy
court made clear that Macias failed to meet the first of these three requirements —
a meritorious defense that might have affected the outcome. Throughout the

4

Macias also contends the district court erred in relying primarily on In re Worldwide Web
Systems. But just as it was appropriate for the bankruptcy court to rely on the meritorious
defense part of our test, it was also correct for the district court to do so in conducting its review.
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hearing, the court discussed at length with Macias what sort of evidence she had
that might excuse her from liability. Ultimately, the court said, Macias’s
arguments amounted only to “a lot of gibberish and incompetent machinations . . .
.” We cannot say the bankruptcy court abused its discretion in coming to this
conclusion. And, based on its determination that Macias failed to satisfy the first
prong of our test for excusable neglect, the court was not required to go further.
Macias argues as well the bankruptcy court denied her the right to represent
herself in her bankruptcy proceeding in violation of 28 U.S.C. § 1654.5 She
contends the district court improperly required her to obtain counsel to proceed to
trial. Although it is true the court required Macias to hire a lawyer to get to a trial,
the court did so as a second-chance offering. The court merely offered her the
chance to revive her defense by having an attorney bring to the court’s attention
something that would suggest she had a meritorious defense. However, the court
was never presented with anything to change its ultimate decision that Macias had
not satisfied the requirements to have the default judgment against her vacated.
That the court offered Macias the opportunity to secure counsel did not violate any
right she had to proceed pro se.
5

Here again, the Trustee argues Macias abandoned this argument, asserting she only cited an
alleged constitutional violation in her appeal to the district court. This is not true — Macias
expressly cited and quoted § 1654 in her brief to the district court. She has, however, abandoned
her claim that the bankruptcy court somehow violated her constitutional right by requiring her to
obtain a lawyer to proceed to trial. See Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008)
(explaining that issues not briefed on appeal are deemed abandoned).
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For these reasons, the order of the district court upholding the bankruptcy
court’s denial of Macias’s motion to vacate is
AFFIRMED.

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