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If your company ignored a lawsuit and the court entered a judgment against it, the case is not necessarily over. A motion to vacate default judgment asks the court to set that judgment aside so the company can defend on the merits. Whether it works depends on three things: why the company missed the deadline, what defense it has, and how fast it moves now.
This guide covers the fix. For what happens before a judgment is entered, read What Happens If You Ignore a Lawsuit Against Your Business.
What Is a Motion to Vacate a Default Judgment?
It is a request asking the court to undo a judgment entered because the company never responded. Under Rule 1.500(d) of the Florida Rules of Civil Procedure, once a final judgment follows a default, the court may set it aside “in accordance with rule 1.540(b).” Rule 1.540(b) is the usual path, so the ground you choose decides your deadline and your burden.
If your company has not been defaulted yet, read how a late answer can still stop a default.
Which Ground Fits Your Situation?
Rule 1.540(b) lists five grounds. Three matter most after an ignored lawsuit, and each carries a different clock.
Was Your Company Ever Properly Served?
If not, the judgment may be void under Rule 1.540(b)(4), and timing works in your favor. A void judgment is not subject to the rule’s one-year cap. In Del Conte Enterprises, Inc. v. Thomas Publishing Co., the plaintiff “never served the appellant or its actual registered agent.” The trial court refused relief as untimely. The Third District reversed, holding the judgment void and the filing delay of more than a year “irrelevant.”
That judgment was a consent judgment, not a default, but the court’s rule reaches any judgment entered without service: “a judgment entered without due service of process is void.”
Start by pulling the return of service. Compare it against your registered agent records and the rules for accepting service of process on behalf of a business entity.
Did the Company Make a Mistake It Can Explain?
Rule 1.540(b)(1) covers “mistake, inadvertence, surprise, or excusable neglect.” This ground expires one year after the judgment is entered. The rule also requires every motion to be filed “within a reasonable time,” so waiting out most of that year is a risk.
A deliberate choice to set the papers aside is hard to fit into any of those terms. A real breakdown, such as papers routed to the wrong person or a delay in hiring counsel, is a better fit.
Facts showing the company meant to defend help most. In the Huynh case discussed below, a letter sent before the deadline asking for more time was, in the court’s words, “sufficient to put Huynh on notice” that the defendants “intended to defend the lawsuit.”
Did the Plaintiff Mislead the Court?
Rule 1.540(b)(3) covers “fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party.” It carries the same one-year limit as excusable neglect. The rule separately preserves an independent action to set aside a judgment for fraud upon the court.
What Does the Motion Have to Prove?
On an excusable neglect motion, three things: excusable neglect, a meritorious defense, and diligence. In Professional Golf Global Group, LLC v. Huynh, the Second District restated that test and noted that “courts should liberally set aside defaults so that lawsuits may be determined on their merits.” Liberal does not mean automatic, and each element needs proof.
Excusable Neglect Needs Sworn Facts
“Excusable neglect must be proven by sworn statements or affidavits,” the Second District explained in Geer v. Jacobsen, quoting an earlier decision. Unsworn explanations are not enough. In Huynh, an officer’s affidavit showed he was still looking for a lawyer when the response was due and had written to opposing counsel and the court asking for more time. That was enough.
The Defense Has to Be Specific
A meritorious defense “must be asserted either by a pleading or in an affidavit,” according to Huynh. A factual defense needs a verified answer, sworn motion, or affidavit. The Huynh defendants laid out specifics: the deal was never a loan, nonpayment was not a breach under the agreement’s terms, and the company never signed it.
Diligence Is Measured From the Day You Learn
Courts weigh “both the extent of the delay and the reasons for the delay.” In Huynh, a motion filed three weeks after the default and two weeks after the judgment was diligent. Our earlier post on being sued without knowing it explains why months of delay can sink an otherwise strong motion.
Does Filing the Motion Stop Collection?
No. Rule 1.540(b) states that the motion “does not affect the finality of a judgment, decree, or order or suspend its operation.” While the motion is pending, the creditor can keep enforcing.
That can mean efforts to garnish your operating accounts, proceedings supplementary, or judgment liens over accounts and payment intangibles. If the company needs collection paused, that takes a separate request. Our post on the lasting effect of not responding to a lawsuit covers how long that exposure lasts.
What If Liability Stands but the Damages Number Is Wrong?
Look hard at how the amount was set. When damages must be proven, Rule 1.500(e) builds in “notice to the defaulted party of any evidentiary hearing on the above matters and of any trials.” A judgment that skipped required notice on damages may be open to challenge even if the default itself holds.
Attorney’s fees are a common example. We explain why fees are treated as unliquidated and need notice and a hearing in our post on attorney’s fees in a default judgment.
Can You Appeal If the Motion Is Denied?
Generally, yes. An order on a timely Rule 1.540(b) motion can be appealed, and the Huynh court took jurisdiction under Florida Rule of Appellate Procedure 9.130(a)(5). It reversed because the trial court abused its discretion in denying relief. If you lose at the trial level, talk with our appeals team before the appellate deadline runs.
What Should Your Company Do This Week?
Move now, because diligence counts from the day you learned of the default. In order:
- Pull the docket and the return of service. Confirm who was served, where, and when.
- Mark the one-year date. Count from entry of the judgment, not from when you found out.
- Write down what went wrong. Who received the papers, where they went, and why no one responded. Those facts become the affidavit.
- Outline your defense. Gather the contract, invoices, and correspondence that show why the claim fails.
- Retain counsel. In Florida, a corporation generally cannot appear in court through a non-lawyer, so the company needs a lawyer to file the motion.
- Preserve your records. If the judgment is vacated, the case moves forward, so put a litigation hold on emails and files about the dispute.
Our checklist of what to bring to your first meeting with a business litigation lawyer will speed that up. If the clock has not run yet, read what happens if you miss the deadline to respond to a lawsuit and how to respond to a lawsuit filed against your business.
How Jimerson Birr Helps Businesses Undo a Default Judgment
Our lawsuit defense attorneys review the service record, pick the strongest Rule 1.540(b) ground, and build the sworn record the motion needs. If the judgment is vacated, our business litigation team is ready to defend the case on its merits.