What happens when you pay a settlement payment late?
From the Didn’t-See-That-Coming Department, and further evidence that you never know how a judge will rule.
A small-claims defendant faced a harsh reality in Broward County after her agreed settlement payment could not be delivered on time because the Plaintiff’s attorney was not at his office.
The defendant was complying with a court order that required her to direct payment “to Plaintiff’s counsel’s Trust Account,” and deliver it “directly to Plaintiff’s counsel’s office.” The date before the payment was due, she sent the payment for next-day delivery via FedEx, signature required.
On April 1, 2016, the due date, FedEx arrived at the Plaintiff’s attorney’s office at 11:50 a.m. No one was there to sign for the package. FedEx left a door sticker.
That afternoon, the Defendant’s lawyer emailed the Plaintiff’s attorney to notify him of the delivery attempt and confirm whether the Plaintiff’s attorney operated his law firm at that address, which differed from the addresses on his website and the Florida Bar. He confirmed that it was.
On April 4, 2016, the next business day, FedEx attempted delivery at 10:55 a.m. Again, the office was closed.
That same day, Plaintiff filed an affidavit of noncompliance attempting to obtain a final judgment.
Meanwhile, FedEx continued its delivery attempts, each day showing up at an empty or closed office.
On April 7, 2016, the court entered a final judgment based on Plaintiff’s affidavit of noncompliance.
On April 13, 2016, the Defendant moved for relief from judgment, therein explaining the situation, attaching proof of delivery, and showing that Defendant would have made timely payment had the Plaintiff’s attorney been at his office when FedEx arrived.
On April 13, 2016, the court denied the motion, stating that Defendant’s choice to send the payment via FedEx, signature required, on the date before the payment was due was “at Defendant’s peril.” The court explained that “[t]he operative date … was the date of ‘delivery directly to Plaintiff’s counsel’s office,’ not the date the Plaintiff tendered the payment to its delivery service. Once the Defendant failed to comply with the requirements of this Court’s Order, the Plaintiff was entitled to his judgment….”
Was the judge correct?
In my opinion, the judge should have granted the motion to vacate. It is generally accepted, for example, that “[s]ervice by mail is complete upon mailing.” Fla. R. Jud. Admin. R. 2.516(a)(2). Furthermore, if the Plaintiff’s attorney was not present to receive the payment, he was the one who impeded its receipt.
While I think it would have been an interesting case to see on appeal, the practicality of appealing a small-claims case is lost where the cost to appeal exceeds the cost to pay off the judgment.
Morals to this story? You never know how a judge will rule; a lawsuit is always a gamble; and don’t pay your settlements late.
The case is Jallali v. Rayo, 24 Fla. L. Weekly Supp. 81b (Apr. 13, 2016), published in the Florida Law Weekly supplement.