Sometimes when a party gets a default judgment against another party, there’s a rush to make the judgment final. But as American Express Centurion Bank and American Express Bank found out in In re Daredia, you’ve got to be careful about what you ask for because there are consequences.
In the trial court, the American Express entities sued two defendants, Pervez Daredia and Map Wireless, Inc. Map Wireless did not answer, while Daredia did. American Express took a default judgment that contained language reciting that the "judgment disposes of all parties and all claims in this cause of action and is therefore FINAL." Oops. Apparently, American Express forgot that there was another party–Daredia.
American Express realized its mistake only too late–after the trial court’s plenary jurisdiction had expired. At that time, American Express tried to correct the judgment with a motion for judgment nunc pro tunc. The trial court granted the motion.
On Petition for Writ of Mandamus, the Texas Supreme Court, in reliance on its opinion in Lehmann v. Har-Con Corp., pointed out that Lehmann did not require that you use the exact language suggested in that opinion–only that the judgment reflect on its face an intent to make it final. And the court held that this judgment did just that. The court also reiterated the differences between errors made in entering a judgment, which are clerical, and errors made in rendering a judgment, which are judicial. All too often state practitioners carelessly mix these concepts, but here we have a prime example of where the distinction is all the difference. Here, the error was in the rendition of the judgment because the trial court rendered (signed) precisely the judgment American Express asked the trial court to render.
Because Daredia had no adequate remedy by appeal once the trial court set aside the final judgment, the Supreme Court held that mandamus relief was available. The court’s opinion may be found here.