Motion for New Trial to Set Aside Default Judgment (Debt) - Texas

IN THE [____________] COURT OF [____________] COUNTY, TEXAS

Cause No. [____________]

DEFENDANT'S MOTION FOR NEW TRIAL TO SET ASIDE DEFAULT JUDGMENT

Filed Pursuant to Tex. R. Civ. P. 320 and 329b and the Craddock Test

COMES NOW the Defendant, [____________] ("Defendant"), appearing [☐ pro se / ☐ by and through undersigned counsel], and files this Motion for New Trial to set aside the default judgment signed against Defendant in this action on [__/__/____], pursuant to Tex. R. Civ. P. 320 and 329b and the test set out in Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124 (Tex. 1939). In support, Defendant respectfully shows the Court as follows:

I. INTRODUCTION AND BASIS FOR RELIEF

1. This is a debt-collection action in which Plaintiff [☐ is a debt buyer / ☐ is a collection agency / ☐ claims to be the original creditor] seeking to collect an alleged consumer debt. A no-answer default judgment was signed against Defendant on [__/__/____] in the amount of $[____________], plus [interest, costs, and/or fees].

2. Defendant did not receive proper notice of this suit and/or failed to answer due to accident or mistake (not conscious indifference), has one or more meritorious defenses to the alleged debt, and brings this motion promptly and within the trial court's plenary power. For the reasons set forth below, the default judgment should be set aside and a new trial granted.

3. Texas law disfavors default judgments and favors a trial on the merits. The Craddock test "determines whether a court should grant a motion for new trial to set aside a [no-answer] default judgment." Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124, 126 (Tex. 1939).

II. IDENTIFICATION OF THE DEFAULT JUDGMENT; TIMELINESS

4. Date judgment signed. The default judgment was signed on [__/__/____].

5. Amount. The judgment is in the amount of $[____________], consisting of [principal $[____], interest $[____], attorney's fees $[____], court costs $[____]].

6. How Defendant learned of the judgment. Defendant first learned of the default judgment on [__/__/____] by the following means:

☐ A writ of garnishment served on Defendant's bank
☐ A bank levy or freeze of Defendant's account
☐ An abstract of judgment / judgment lien recorded against Defendant's property
☐ Post-judgment discovery or an oral-deposition / turnover notice
☐ A credit report entry
☐ Other: [____________]

7. Timeliness. This Motion for New Trial is filed on [__/__/____], which is within thirty (30) days after the judgment was signed, and the Court therefore retains plenary power to grant a new trial. Tex. R. Civ. P. 329b(a), (d), (e).

III. LEGAL STANDARD — THE CRADDOCK TEST

8. A trial court should set aside a no-answer default judgment and grant a new trial when the movant establishes all three elements of the Craddock test:

(1) the failure to answer before judgment was not intentional or the result of conscious indifference, but was due to a mistake or accident;

(2) the movant has a meritorious defense; and

(3) granting the motion will not cause delay or otherwise injure the plaintiff.

Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124, 126 (Tex. 1939).

9. "Conscious indifference" means a failure to act that is more than mere negligence; the controlling question is whether the defendant's failure to answer was the act of a person who, under the same or similar circumstances, would have exercised reasonable diligence. A defendant's slight excuse, when uncontroverted, will satisfy the first Craddock element.

10. A judgment without valid service is VOID — Craddock does not apply. A trial court acquires personal jurisdiction over a defendant only through valid service of process or the defendant's appearance. Where the defendant was not properly served, the default judgment is void for lack of personal jurisdiction, and the movant need not satisfy Craddock at all. Browning v. Placke, 698 S.W.2d 362, 363 (Tex. 1985); PNS Stores, Inc. v. Rivera, 379 S.W.3d 267 (Tex. 2012). For a no-answer default, the record must show strict compliance with the rules governing issuance, service, and return of citation; there are no presumptions of valid service in support of a default judgment. Tex. R. Civ. P. 99, 106, 107, 124.

IV. GROUNDS FOR SETTING ASIDE THE JUDGMENT

☐ A. The judgment is VOID — defective or no service of process; lack of personal jurisdiction. Defendant was never validly served with the citation and petition in strict compliance with the Texas Rules of Civil Procedure. Specifically: [describe — e.g., "Defendant did not live at the address where service was attempted," "the return of service is defective or fails to show strict compliance," "the citation was served on a person not authorized to receive it," "Defendant first learned of the suit only through the garnishment"]. Because the Court never acquired personal jurisdiction over Defendant, the judgment is void and must be set aside; the Craddock test does not apply to a void judgment. Browning v. Placke, 698 S.W.2d 362 (Tex. 1985); PNS Stores, Inc. v. Rivera, 379 S.W.3d 267 (Tex. 2012). [Defendant additionally files a special appearance under Tex. R. Civ. P. 120a where appropriate.]

☐ B. First Craddock element — failure to answer was an accident or mistake, not conscious indifference. Defendant's failure to file a timely answer was not intentional and did not result from conscious indifference, but from accident or mistake, in that: [describe — e.g., "Defendant never received the citation," "Defendant was hospitalized," "the papers were misdelivered or received after the deadline," "Defendant reasonably believed the debt had been disputed/resolved with the collector," "Defendant did not understand the answer deadline"].

☐ C. Second Craddock element — meritorious defense (see Section V).

☐ D. Third Craddock element — no delay or injury to Plaintiff. Granting a new trial will not cause delay or otherwise injure Plaintiff. Defendant is ready to answer and proceed promptly, will not seek a continuance for delay, and [☐ offers to reimburse Plaintiff's reasonable costs incurred in taking the default / ☐ agrees to an expedited trial setting]. Plaintiff retains all of its evidence and its claim.

☐ E. Fraud / misconduct in obtaining the judgment. The judgment was obtained through fraud, misrepresentation, or misconduct, including [describe — e.g., "a false return of service / 'sewer service,'" "a robo-signed or false affidavit of debt," "misrepresentation of the amount owed or of any assignment of Defendant's account"].

V. DEFENDANT HAS A MERITORIOUS DEFENSE

11. Defendant has a meritorious defense — that is, facts that in law would constitute a defense to Plaintiff's claim, supported by the affidavit below — and that defense is set up by the facts stated. Defendant need not prove that the defense will ultimately prevail. Defendant asserts the following meritorious defense(s):

☐ Statute of limitations. The alleged debt is time-barred. Section 16.004(a)(3) supplies a four-year period for an action on a debt; § 16.004(c) separately addresses specified account actions; and § 16.051 supplies the residual four-year period when no more specific provision applies. The debt accrued (generally on the date of default/last payment or charge-off) on or about [__/__/____], more than four years before suit was filed. Under Tex. Fin. Code § 392.307, a payment or acknowledgment does NOT revive an expired limitations period, and a debt buyer may not sue to collect a time-barred consumer debt.

☐ Not the debtor / mistaken identity / identity theft. Defendant is not the person who incurred the alleged debt and/or the account was opened or used as a result of identity theft. [Describe; attach FTC Identity Theft Report / police report as Exhibit [__].]

☐ Wrong amount. The amount of the judgment is incorrect, inflated, or includes interest, fees, or charges not authorized by any agreement. The correct balance, if any, is $[____________].

☐ Debt paid, settled, or discharged. The alleged debt was paid, settled, or discharged (including by discharge in bankruptcy on [__/__/____], Case No. [____________]) and is not owed.

☐ Plaintiff lacks standing / no chain of assignment. Plaintiff is not the original creditor and has not proven a complete, unbroken chain of assignment showing it owns Defendant's specific account. Plaintiff is not the real party in interest.

☐ Potential separate FDCPA claim—not by itself a defense that the debt is invalid. If a qualifying debt collector failed to provide the notice or verification required by 15 U.S.C. § 1692g, Defendant may have a separate civil claim under 15 U.S.C. § 1692k. A formal pleading is not an “initial communication” under § 1692g(d). Plead such a claim only if procedurally permitted, and evaluate any state-law issue separately.

☐ Other meritorious defense: [____________]

12. These defenses are substantiated by the facts set forth in Defendant's Affidavit, below, and the attached exhibits, and are sufficient to satisfy the meritorious-defense element of Craddock.

VI. DEFENDANT'S AFFIDAVIT

STATE OF TEXAS )
COUNTY OF [____________] )

I, [____________], being first duly sworn, depose and state as follows:

1. I am the Defendant in this action. I am over the age of eighteen (18) and competent to testify, and I make this affidavit on personal knowledge.

2. [If applicable] I was never validly served with the citation and petition in this case. [State the facts: where you lived on the date of attempted service; whether you received the papers; who, if anyone, was served; how you actually learned of the lawsuit.]

3. My failure to file an answer before the default judgment was not intentional and was not the result of conscious indifference. It was due to accident or mistake, in that: [state the facts establishing accident/mistake — e.g., that you never received the citation, were hospitalized, or believed the matter had been resolved].

4. I first learned that a judgment had been entered against me on [__/__/____], when [describe — e.g., "my bank account was garnished" / "an abstract of judgment appeared against my property"].

5. I have a meritorious defense to Plaintiff's claim, namely: [state the facts supporting the defense(s) checked above — e.g., the date of last payment, that the account is not mine, that the amount is wrong, that the debt was discharged in bankruptcy].

6. Granting a new trial will not delay the case or injure Plaintiff. I am ready to file my answer and proceed promptly and will not seek a continuance for delay.

7. I respectfully ask the Court to set aside the default judgment, grant a new trial, allow me to defend this case on the merits, and stay any collection efforts in the meantime.

_______________________________________
[____________], Defendant / Affiant

Sworn to and subscribed before me this [____] day of [____________], 20[____].

_______________________________________
Notary Public, State of Texas
My commission expires: [__/__/____]

VII. REQUEST TO STAY EXECUTION AND GARNISHMENT

13. Defendant requests that the Court stay execution on the judgment — including any writ of garnishment, bank levy, abstract of judgment, turnover, or other post-judgment process — pending the Court's ruling on this Motion for New Trial. Absent a stay, Defendant faces immediate and irreparable harm from the garnishment or levy of funds that may be exempt and that Defendant needs for basic living expenses, even though the underlying judgment is subject to being set aside.

14. Defendant further requests that any funds already garnished or levied be held by the garnishee or the Court, and not disbursed to Plaintiff, until this motion is decided.

VIII. RELIEF REQUESTED

WHEREFORE, PREMISES CONSIDERED, Defendant respectfully requests that this Court:

A. SET ASIDE the default judgment signed on [__/__/____] and GRANT a NEW TRIAL;

B. In the alternative, VACATE the judgment as VOID for lack of personal jurisdiction due to defective or no service of process;

C. STAY all execution, garnishment, levy, and other post-judgment collection pending the Court's ruling, and order that any funds already garnished or levied be held and not disbursed;

D. QUASH any outstanding writ of garnishment or execution issued on the judgment;

E. GRANT Defendant leave to file an answer and defend this action on the merits, with the accompanying [proposed] Original Answer deemed filed as of the date of the order;

F. Set this matter for a hearing if the Court deems one necessary; and

G. Grant such other and further relief, at law or in equity, to which Defendant may show itself justly entitled.

IX. PROPOSED ORDER

A proposed Order Granting New Trial and Setting Aside Default Judgment is submitted contemporaneously with this motion for the Court's consideration.

[PROPOSED] ORDER

On this day came on to be considered Defendant's Motion for New Trial to Set Aside Default Judgment. Having considered the motion, the supporting affidavit, any response, and the applicable law — including the test in Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124 (Tex. 1939) — the Court finds that the motion is well taken and should be GRANTED.

It is therefore ORDERED that the default judgment signed on [__/__/____] is SET ASIDE, a NEW TRIAL is GRANTED, all garnishments, levies, and executions on that judgment are QUASHED and STAYED, and any garnished or levied funds shall be returned to Defendant; and Defendant's Original Answer is deemed filed as of the date of this Order.

SIGNED this ____ day of __________, 20____.

_________________________________
Judge Presiding

X. SIGNATURE

Respectfully submitted this [____] day of [____________], 20[____].

/s/ [____________________________________]
[____________________________________]
☐ Defendant, pro se ☐ Attorney for Defendant
State Bar of Texas No. (if attorney): [____________]
[Street Address]
[City], Texas [____]
Telephone: ([____]) [____]-[________]
Email: [____________________________________]

XI. CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing Defendant's Motion for New Trial to Set Aside Default Judgment, the supporting Affidavit, and the proposed Order was served on Plaintiff's counsel of record (or on Plaintiff, if unrepresented) in accordance with Tex. R. Civ. P. 21 and 21a on the [____] day of [____________], 20[____], by the following method:

☐ Electronic service through the eFileTexas.gov / electronic-filing manager (for represented parties)
☐ U.S. First-Class Mail, postage prepaid
☐ Certified Mail, Return Receipt Requested
☐ Hand Delivery / Commercial Delivery Service
☐ Email (where permitted under Rule 21a)
☐ Fax

Addressed to:

[____________________________________]
[____________________________________]
[____________________________________]

/s/ [____________________________________]
[____________________________________]

TEXAS PRACTICE NOTES

• Mechanism: In Texas, a default judgment is set aside by a MOTION FOR NEW TRIAL (Tex. R. Civ. P. 320), not a Rule 60-style motion. The governing standard is the three-part Craddock test. Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124 (Tex. 1939).
• Deadline / plenary power: File within 30 days after the judgment is signed (Tex. R. Civ. P. 329b(a)). If not ruled on by written order within 75 days, the motion is overruled by operation of law; the court then keeps plenary power 30 more days — up to 105 days after judgment. Tex. R. Civ. P. 329b(c)–(e). Calendar immediately. In Justice Court, the deadline is 14 days and only one motion is allowed (Tex. R. Civ. P. 505.3) — verify.
• After plenary power expires: The judgment cannot be set aside by the trial court except by a bill of review (equitable; four-year limit under Tex. Civ. Prac. & Rem. Code § 16.051; Caldwell v. Barnes, 154 S.W.3d 93 (Tex. 2004)) or, if the defendant did not participate and error appears on the face of the record, a restricted appeal (within 6 months). Do not use this motion-for-new-trial template past plenary power.
• Void for defective service: A default judgment entered without valid service is VOID for lack of personal jurisdiction; Craddock does not apply, and the judgment may be attacked directly or collaterally. Browning v. Placke, 698 S.W.2d 362 (Tex. 1985); PNS Stores, Inc. v. Rivera, 379 S.W.3d 267 (Tex. 2012). A no-answer default requires strict compliance with the citation/service/return rules, with no presumptions of valid service.
• Statute of limitations: Section 16.004(a)(3) supplies four years for debt; § 16.004(c) separately addresses specified account actions; and § 16.051 is the residual four-year provision. Under Tex. Fin. Code § 392.307, payment/acknowledgment does not revive an expired period, and debt buyers may not sue on time-barred debt.
• Surety bond: Third-party debt collectors must file a $10,000 surety bond with the Secretary of State (Tex. Fin. Code § 392.101). Confirm bond status before relying on this defense.
• Stopping collection: A motion for new trial does not by itself suspend enforcement; obtain a stay/supersedeas order or post a supersedeas bond (Tex. R. App. P. 24; Tex. R. Civ. P. 627–629) to halt a writ of execution or garnishment.

Sources and References

• Texas Rules of Civil Procedure (incl. 320, 329b, 21, 21a, 99, 106, 107, 120a, 505.3): https://www.txcourts.gov/rules-forms/rules-standards/
• Tex. R. Civ. P. 329b (motions for new trial; plenary power) — text: http://www.stcl.edu/lib/TexasRulesProject/TRCP320-329b/rule329b1981.htm
• Craddock v. Sunshine Bus Lines, Inc., 133 S.W.2d 124 (Tex. 1939) — three-part test to set aside default.
• Browning v. Placke, 698 S.W.2d 362 (Tex. 1985) — default judgment void if court lacked personal jurisdiction.
• PNS Stores, Inc. v. Rivera, 379 S.W.3d 267 (Tex. 2012) — void judgment; defective service; direct/collateral attack: https://cases.justia.com/texas/supreme-court/10-1028.pdf
• Caldwell v. Barnes, 154 S.W.3d 93 (Tex. 2004) — equitable bill of review.
• Tex. Civ. Prac. & Rem. Code ch. 16 (limitations; bill of review § 16.051): https://statutes.capitol.texas.gov/Docs/CP/htm/CP.16.htm
• Tex. Fin. Code ch. 392 (Texas Debt Collection Act; § 392.101 bond; § 392.307 time-barred debt): https://statutes.capitol.texas.gov/Docs/FI/htm/FI.392.htm
• Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq.: https://www.ftc.gov/legal-library/browse/rules/fair-debt-collection-practices-act-text
• CFPB — time-barred debt: https://www.consumerfinance.gov/ask-cfpb/can-debt-collectors-collect-a-debt-thats-several-years-old-en-1423/
• Texas State Law Library — Time-Barred Debts: https://guides.sll.texas.gov/debt-collection/time-barred-debts