Wilson v. Atwood Group

• Decision Date: 21 February 1984
• Docket Number: No. 82-3688,82-3688
• Citation: 725 F.2d 255
• Parties: Mrs. Charlotte WILSON, Plaintiff, v. The ATWOOD GROUP and Occidental Petroleum Corp., Defendants-Appellees Cross-Appellants, v. Kirby L. STARK, Worldwide Drilling Consultants, Inc. and Hartford Accident and Indemnity Co., Third-Party Defendants-Appellants Cross-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 255

725 F.2d 255

Mrs. Charlotte WILSON, Plaintiff, v. The ATWOOD GROUP and Occidental Petroleum Corp., Defendants-Appellees Cross-Appellants, v. Kirby L. STARK, Worldwide Drilling Consultants, Inc. and Hartford Accident and Indemnity Co., Third-Party

Defendants-Appellants Cross-Appellees.

No. 82-3688.

United States Court of Appeals, Fifth Circuit.

Feb. 21, 1984.

Hebert & Abbott, Lawrence E. Abbott, Scott E. Delacroix, New Orleans, La., for third-party defendants-appellants cross-appellees.

Camp, Carmouche, Palmer, Barsh & Hunter, Donald Ensenat, New Orleans, La., for Atwood.

Hailey, McNamara, McNamara & Hall, Antonio E. Papale, Jr., Metairie, La., for Occidental Petroleum.

Appeals from the United States District Court for the Eastern District of Louisiana.

Before CLARK, Chief Judge, BROWN, GEE, RUBIN, REAVLEY, POLITZ, RANDALL, TATE, JOHNSON, WILLIAMS, GARWOOD, JOLLY, HIGGINBOTHAM, and DAVIS, Circuit Judges.

ALVIN B. RUBIN, Circuit Judge:

The appellants failed to file this appeal within thirty days after the district court entered judgment because, and only because, their counsel had relied on the clerk of court to give notice of the entry of judgment and the clerk failed to do so. Consequently, counsel did not learn of the judgment until the time for appeal had expired. Because the notice of appeal was filed too late, we dismiss the appeal.

This death action was filed in 1979 and later settled by the defendants, The Atwood Group and Occidental Petroleum Corporation. Before settling the primary lawsuit, the defendants filed a third-party complaint against Kirby L. Stark, Worldwide Drilling Consultants, Inc., and Hartford Accident and Indemnity Company. Because the third-party defendants declined to contribute to the settlement, the third-party claim was tried without a jury by Judge Jack M. Gordon in May 1981. Judge Gordon took the case under advisement, but died before rendering judgment. In accordance with the usual procedure in the Eastern District of Louisiana, the case was then reassigned to Judge Patrick E. Carr to act on matters arising until the vacancy caused by Judge Gordon's death could be filled. In April 1982, the case was submitted to Judge Carr on the transcript of the first trial. Judge Carr rendered judgment against the third-party defendants, Stark, Worldwide, and Hartford, and this was entered in June 1982. The third-party defendants made a timely motion for new trial. A hearing was scheduled, but, in the interim, Judge Henry Mentz was appointed to succeed Judge Gordon. In accordance with the usual procedure, all of the cases that had originally been assigned to Judge Gordon were assigned to Judge Mentz. Judge Mentz, therefore, heard the motion without objection by any party on August 11, 1982. He overruled it the next day.

The clerk mailed notice of the order to the third-party plaintiffs (the appellees) but, due to a clerical error, did not mail notice to the third-party defendants (the appellants). Counsel for the third-party defendants did not seek information from the clerk about the status of the motion or take any other step to determine when judgment might be entered. More than two months after judgment was entered, counsel for the third-party plaintiffs, Atwood Group and Occidental, demanded payment of the judgment. Counsel for the third-party defendants thus learned for the first time that the motion for a new trial had been denied. They moved promptly for an enlargement of time in which to file a notice of appeal.

Judge Mentz heard the motion on November 3, 1982. At the hearing it became apparent that, sometime in June, a deputy clerk had erroneously placed the word "out" beside the third-party defendants' (appellants') names on the docket sheet. The notation "out" indicated that these parties were no longer in the case. Consequently, the clerk had mailed no further notices to their counsel.

Judge Mentz granted the motion to enlarge the time to appeal, relying on Fed.R.Civ.P. 60(b). He vacated and then reentered his denial of the motion for new trial because he did "not find any fault on the part of counsel for third party defendants. In light of the eleven-month delay in the rendering of a decision in this case, it was not unreasonable for counsel to anticipate further delays with respect to a decision on the post-trial motions."

A panel of this court dismissed the appeal. 702 F.2d 77 (5th Cir.1983). The full court granted rehearing en banc. We now reach the same result as the panel.

By its terms, Fed.R.Civ.P. 77(d) precludes this appeal. It states:

Lack of notice of the entry by the clerk does not affect the time to appeal or relieve or authorize the court to relieve a party for failure to appeal within the time allowed....

Advisory Committee Notes explain that this provision was inserted to prevent the procedure employed here. Under the rule previously established by Hill v. Hawes, 320 U.S. 520, 64 S.Ct. 334, 88 L.Ed. 283 (1944), if the district court clerk did not notify the parties of judgment, the district court could vacate and reenter its judgment. The Advisory Committee expressly rejected Hill, stating:

the decision in Hill v. Hawes is to give the district court power, in its discretion and without time limit, and long after the term may have expired, to vacate a judgment and reenter it for the purpose of reviving the right of appeal. This seriously affects the finality of judgments....

Rule 77(d) as amended makes it clear that notification by the clerk of the entry of a judgment has nothing to do with the starting of the time for appeal; that time starts to run from the date of entry of judgment and not from the date of notice of the entry. Notification by the clerk is merely for the convenience of litigants.

The rule is strict, but its meaning and purpose are plain. We have consistently held that the simple failure of the clerk to mail notice of the entry of judgment, without more, does not permit relief to a party who has failed to appeal within the prescribed time. In Re Morrow, 502 F.2d 520 (5th Cir.1974); Jones v. Estelle, 693 F.2d 547 (5th Cir.1982), cert. denied, --- U.S. ----, 103 S.Ct. 1528, 75 L.Ed.2d 950 (1983); Nelson v. Foti, 707 F.2d 170 (5th Cir.1983).

Because of what the panel opinion correctly called the "draconian effect" of rule 77(d), courts have sought to palliate its results by invoking rule 60(b). This rule states that the court may relieve a party from a judgment or order for any "reason justifying relief from the operation of the judgment." In Hensley v. Chesapeake & Ohio Railway Co., 651 F.2d 226 (4th Cir.1981), the Fourth Circuit held that a court may rely on rule 60(b) to supersede rule 77(d) under "unique circumstances." The District of Columbia Circuit has been even more generous, holding that rule 60(b) permits a district court to vacate and reenter a judgment if the appellant was not at fault in failing to appeal, timely notice was given to neither party, and the appellee will not be prejudiced. Expeditions Unlimited Aquatic Enterprises, Inc. v. Smithsonian Institute, 500 F.2d 808 (D.C.Cir.1974).

This rule simply permits counsel to rely upon the failure of the clerk to give notice if three conditions are satisfied. We are unable to perceive the relevance of the clerk's failure to give notice to the prevailing party. The would-be appellant is neither advantaged nor disadvantaged by the equal ignorance of the prevailing party: the record remains the same, however late the appeal. Examination for prejudice to the prevailing party is therefore paradoxical. There can be no prejudice except detrimental reliance on the failure to appeal, but, if the prevailing party has no notice of the judgment, he cannot rely on its finality. The effect of this interpretation is virtually a return to Hill, the decision that rule 77(d) was designed to overturn. Accordingly, the Second Circuit has rejected this effort to circumvent rule 77(d): "a Rule 60(b)(6) motion may not be granted absent some showing of diligent effort by counsel to ascertain the status of the case." Mizell v. Attorney General of the State of New York, 586 F.2d 942, 944-45 n. 2 (2d Cir.1978), cert. denied, 440 U.S. 967, 99 S.Ct. 1519, 59 L.Ed.2d 783 (1979).

We accept the district court's findings that this case presents "unique circumstances" and that it was not unreasonable for counsel to anticipate further delay in decision. Fed.R.Civ.P. 52(a). But counsel made no effort to determine whether the decision was likely to be or was being delayed and did not forego action because of his belief that decision was likely to be delayed. He simply relied on the clerk to give notice. Apparently, this was no departure from his usual practice: the record gives no reason to believe he would have acted otherwise under normal circumstances. Delay caused solely by unwarranted reliance on an expectation that notification routine would be followed does not permit intervention by the district court.

We have previously permitted relief from the 30-day limit when counsel who filed a belated notice of appeal had not relied on the clerk to give notice of the entry of judgment but had been diligent in attempting either to delay its entry or to inquire about the status of the case. Smith v. Jackson Tool & Die, Inc., 426 F.2d 5 (5th Cir.1970); Fidelity and Deposit Co. of Maryland v. UsaForm Hail Pool, Inc., 523 F.2d 744 (5th Cir.1975), cert. denied, 425 U.S. 950, 96 S.Ct. 1725, 48 L.Ed.2d 194 (1976). Other circumstances might also be the basis for relief from a judgment in accordance with rule 60(b). Counsel is not guilty of inexcusable neglect if he fails to run a periodic docket check with the clerk on every pending case to determine whether a judgment has been entered without notice to him. But to be relieved from the effect of a judgment, a party must show more than mere reliance on the clerk to give notice of a judgment.

The present appeal, therefore, does not require us to...