Kahrobaie v. Wilshire
State Bank
Dallas Court of Appeals, No. 05-13-01233-CV (October 30,
2014)
Justices Francis and Myers (Opinion)
The Dallas Court of Appeals reminded practitioners they should never assume a Craddock factor for setting aside a post-answer default judgment has been met. Instead, the party seeking to set aside the default must present evidence supporting each factor. In a lawsuit to enforce loan guarantees after a foreclosure sale, the guarantors failed to respond to a no-evidence motion for summary judgment, and the trial court granted the motion. The guarantors later moved to set aside the judgment and for new trial, which the trial court denied. Under Craddock, when applied in the summary judgment context, the guarantors bore the burden to submit proof raising a material question of fact that (1) the failure was not intentional or the result of conscious indifference but was due to a mistake or accident; (2) the defendant has a meritorious defense; and (3) granting a new trial would not result in delay or otherwise injury the plaintiff. Here, the guarantors presented no evidence of the third factor. Their counsel’s affidavit, while explaining the failure to respond to the motion for summary judgment, did not state that the granting of a new trial would not delay or injure the plaintiff, did not state that the guarantors were ready, willing, and able to go immediately to trial, and did not offer to reimburse the plaintiff for fees incurred in obtaining the summary judgment. Because the defendants failed to carry their burden on this third factor, the Court affirmed the denial of the motion for new trial.
