Rico Sun Tours, Inc. v. Capeles et al
Filing
62
ORDER granting 47 Motion to Set Aside Entry of Default; finding as moot 61 Motion to clarify. Answer due by 11/24/2014. No extensions. Signed by Judge Jay A. Garcia-Gregory on 11/13/2014. (CLM)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
RICO SUN TOURS, INC.,
Plaintiff,
v.
CIVIL NO. 14-1583(JAG)
EDGARD CAPELES VARGAS,
Defendant.
OPINION AND ORDER
Garcia-Gregory, D.J.
Before the Court is a Motion to Set Aside Entry of Default
filed by Union de Transporte y Ramas Anexas, Inc (“UTRA” or
“Defendant”). (Docket No. 47). For the reasons stated below, the
Motion is hereby GRANTED.
BACKGROUND
On
July
30,
2014,
Rico
Sun
Tours,
Inc.
(“RST”
or
“Plaintiff”) filed the present suit against several defendants,
including
UTRA.
(Docket
No.
1).
On
August
6,
2014,
German
Vazquez, a co-defendant in this suit and also UTRA’s President,
was
duly
served
with
a
copy
of
the
Complaint
and
Summons.
enter
default
(Docket No. 7-8).
On
against
September
UTRA
8,
claiming
2014,
that
Plaintiff
it
had
moved
not
to
appeared
or
filed
a
Civil No. 14-1583 (JAG)
2
responsive pleading within the 21 days afforded. (Docket No.
22).
On
October
13,
2014,
relying
on
the
Proof
of
Service
attached to Plaintiff’s motion, (Docket No. 22; Ex. 1), this
Court
granted
(Docket
No.
the
motion
40).
Upon
and
the
representative appeared and
entered
entry
of
default
against
UTRA.
default,
UTRA’s
legal
moved to set aside the entry of
default on October 27, 2014 and asked the Court for time to
answer the Complaint. (Docket No. 47). Plaintiff filed a timely
opposition to UTRA’s Motion on November 3, 2014. (Docket No.
55).
Plaintiff claims that Mr. Vazquez was served both in his
individual
capacity
and
as
the
person
designated
by
law
to
accept service of process on behalf of UTRA. (Docket No. 55). On
the other hand, Defendant argues that Mr. Vazquez was not served
with a separate Summons directed to UTRA, but rather with a copy
of
the
Complaint
and
Summons
addressing
Mr.
Vazquez
in
his
personal capacity. (Docket No. 47).
DISCUSSION
Fed. R. Civ. P. 55(c) provides that courts may set aside an
entry of default for “good cause.” This standard of “good cause”
has been consistently considered to be a “liberal” and “mutable
standard, varying from situation to situation[,] . . . but not
so elastic as to be devoid of substance.” Coon v. Grenier, 867
F.2d 73, 76 (1st Cir. 1989). While the “good cause” lacks a
Civil No. 14-1583 (JAG)
precise
definition,
3
“some
general
guidelines
are
commonly
applied.” Compania Interamericana Exp.-Imp., S.A. v. Compania
Dominicana
de
Aviacion,
88
F.3d
948,
951
(11th
Cir.
1996)
(citing Coon, 867 F.2d at 76)).
Among the several factors that courts have considered in
determining whether to set aside an entry of default are: “(1)
whether the default was willful; (2) whether setting it aside
would prejudice the adversary; and (3) whether a meritorious
defense is presented.” Indigo Am., Inc. v. Big Impressions, LLC,
597
F.3d
1,
3
(1st
Cir.
2010)
(citations
omitted).
These
factors, however, are neither exclusive nor dispositive. Other
factors often considered are: “(4) the nature of the defendant's
explanation for the default; (5) the good faith of the parties;
(6) the amount of money involved; (7) the timing of the motion
to set aside the entry of default.” Id. (citation omitted).
Moreover, whenever an entry of default has been entered
without an accompanying default judgment, such as in this case,
the standard is particularly generous in favor of the party
seeking
relief
Weiner,
103
from
F.R.D.
the
177,
entry
179
of
(D.
default.
Maine
See
Phillips
1984)(explaining
v.
the
liberality of the “good cause” standard in light of the fact
that “mere entry of default” is a clerical act and “does not
represent
a
final
judgment.”);
see
also
Colleton
Preparatory
Academy, Inc. v. Hoover Universal, Inc., 616 F.3d 413, 418 (4th
Civil No. 14-1583 (JAG)
Cir.
2010).
Finally,
4
it
is
well
established
that
entry
of
defaults are generally disfavored because they clash with the
courts’
preference
and
“philosophy
that
actions
should
ordinarily be resolved on their merits.” Coon, 867 F.2d at 76.
In this case, Defendant contends that it was not properly
served
and
provides
a
sworn
statement
to
those
effects.
Plaintiff, on the other hand, has provided the Court with a copy
of the Proof of Service suggesting that UTRA was served properly
through
Mr.
Vazquez.
Nonetheless,
“a
district
court
should
resolve doubts in favor of a party seeking relief from the entry
of a default.” Leshore v. County of Worcester, 945 F.2d 471, 472
(1st
Cir.
1991).
justification,
Consequently,
UTRA
has
met
in
the
light
liberal
of
the
reasonable
standard
of
“good
cause.”
Furthermore, there is no evidence in the record suggesting
that
UTRA’s
default
was
willful
or
made
in
bad
faith.
In
addition, Plaintiff cannot seriously argue that setting aside
the entry of default would cause unfair prejudice so early in
the case. See Coon, 867 F.2d at 76 (citation omitted) (“Early in
the case, as when a default has been entered but no judgment
proven,
a
prejudice
liberal
approach
to
nonmovant
the
is
least
or
to
likely
to
discommode
cause
unfair
the
court's
calendar.”). Finally, Defendant acted promptly to correct the
default by retaining counsel and filing the present motion on
Civil No. 14-1583 (JAG)
5
October 27, 2014. See, e.g., Compania Interamericana, 88 F.3d at
951-952 (considering the party’s response to correct its default
as one of the factors to be considered under Fed. R. Civ. P.
55(c)).
In
conclusion,
the
Court
finds
that,
in
light
of
the
circumstances of this case, the entry of default is too harsh
and shall accordingly set it aside.
This decision is consistent
with the stated and well established preference of resolving
disputes
on
defaulting
a
their
party
merits
is
a
and
the
drastic
commonly
sanction
held
reserved
view
that
for
rare
occasions. See Stewart v. Astrue, 552 F.3d 26, 28 (1st Cir.
2009).
CONCLUSION
For
the
reasons
stated
above,
the
Court
hereby
GRANTS
Defendant’s Motion to Set Aside the Entry of Default, (Docket
No. 47). Defendant shall file an Answer to the Complaint by
Monday, November 24, 2014.
IT IS SO ORDERED.
In San Juan, Puerto Rico, this 13th day of November, 2014.
S/ Jay A. Garcia-Gregory
JAY A. GARCIA-GREGORY
United States District Judge
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