DALLAS - The Fifth Court of Appeals recently reversed a default judgment in favor of USAA Casualty Insurance and US Lloyds Insurance, finding that the trial court abused its discretion.
According to the Fifth Court’s April 18 opinion, John Panakkal Joy appealed from a post-answer default judgment, asserting that the trial court erred in granting the default judgment and denying his motion for new trial because he did not receive notice of the trial setting and default judgment hearing.
Alternatively, Joy also argued that the trial court erred in denying his motion for new trial because the uncontroverted evidence in support of the motion established the three elements identified in Craddock v. Sunshine Bus Lines, Inc.
The Fifth Court found that Joy established the Craddock elements, reversing the trial court’s default judgment and remanding for further proceedings.
This lawsuit arises out of a three-car automobile accident. US Lloyds and USAA insured the other two drivers.
Court records show the insurers filed suit and that their cases were consolidated. The trial of the case was continued. Neither Joy nor his counsel appeared for the new trial setting. US Lloyds verbally moved for default judgment and USAA joined in the motion. The trial court granted the motions and signed a default judgment against Joy.
According to the opinion, Joy timely filed a verified motion to set aside the default judgment or, alternatively, a motion for a new trial. Neither US Lloyds nor USAA filed a response. Following a hearing, the trial court denied the motion and the appeal followed.
Under the Craddock test, the defendant must establish that the failure to appear was not intentional or the result of conscious indifference but was the result of an accident or mistake; he or she has a meritorious defense; and granting a new trial will occasion no delay or otherwise injure the plaintiff who obtained the default judgment.
“In sum, the uncontroverted factual allegations in Joy’s verified motion for new trial and his counsel’s statements at the hearing on the motion satisfied each Craddock element,” the opinion states. “In denying the motion, the trial court abused its discretion. We reverse the trial court’s default judgment and remand the case for further proceedings.”
Case No. 05-22-00310-CV