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Delzona Corp. v. Sacks

decided.: March 24, 1959.

DELZONA CORPORATION
v.
SAMUEL SACKS, HIS WIFE SARA E. SACKS, SOMETIMES KNOWN AS ROSE SACKS, EDITH SACKS HOROWITZ, HER HUSBAND SIDNEY HOROWITZ, ROSE SACKS RUBENSTEIN, HER HUSBAND IMMANUEL RUBENSTEIN, FREDERICK PARKS, HUGHES PARK VILLAGE, INC., LOUIS GREENBLATT, UNITED INDUSTRIAL FINANCE CORPORATION, J. W. SPARKS & CO., MAJESTIC DISCOUNT COMPANY. SAMUEL SACKS, HIS WIFE SARA E. SACKS, SOMETIMES KNOWN AS ROSE SACKS, EDITH SACKS HOROWITZ, HER HUSBAND SIDNEY HOROWITZ, ROSE SACKS RUBENSTEIN, HER HUSBAND IMMANUEL RUBENSTEIN, HUGHES PARK VILLAGE, INC., LOUIS GREENBLATT, UNITED INDUSTRIAL FINANCE CORPORATION, AND MAJESTIC DISCOUNT COMPANY, APPELLANTS.



Author: Goodrich

Before BIGGS, Chief Judge, and GOODRICH and McLAUGHLIN, Circuit Judges.

GOODRICH, Circuit Judge.

This is an appeal from the refusal of the trial judge to relieve the appellant from a judgment. The judgment sought to be relieved from was entered on June 26, 1956. The motion to be relieved from the judgment was made on July 21, 1958. The application is under Rule 60(b) of the Federal Rules of Civil Procedure.*fn1 The ground relied upon must necessarily be the general reason given in number 6 of the rule, "any other reason justifying relief from the operation of the judgment."

This litigation is already excessively prolonged. It began in 1954; the complaint was filed on June 9th. The plaintiff corporation had an officer who was alleged to have embezzled a large quantity of its funds. And it was alleged that a large amount of these funds came into the hands of some of the defendants in this action who invested some of them in certain properties. It is not necessary that we follow step by step the intricate labyrinth of stipulations, motions, opposition to motions and so on. The question before us is confined to the propriety of the district court's action in refusing relief from the 1956 judgment. That judgment was entered pursuant to a stipulation among the parties. The stipulation provided in part, with a condition that time was of the essence, for settling the entire controversy by periodic payments totaling $500,000. Part of the money was paid in accordance with the arrangement. Subsequently, the defendants defaulted and the succeeding litigation has had to do with the consequence of that default.

Relief under Rule 60(b) is, in the first instance, a matter for the discretion of the trial court. Tozer v. Charles A. Krause Milling Co., 3 Cir., 1951, 189 F.2d 242. See also 7 Moore, Federal Practice PP. 60.19 at pp. 222-23 (2d ed. 1955). We think Judge Lord was entirely within the proper limits of his discretion in denying relief to these appellants.

In the first place the motion was not timely.Rule 60(b) requires a motion to be made within a "reasonable time."*fn2

Appellants' motion for relief in the court below asserted that the plaintiff, attempting to recover the amount of its judgment, was without authority to sell certain realty purchased with the embezzled funds. However, it is not denied that defendants in December, 1956, and January, 1957, cooperated in the sale of property in the tract known as Hughes Park, about which they now complain. They cooperated by delivering a mortgage necessary to the transfer of that property. Nor is it to be denied that they further cooperated by procuring a power of attorney for the same purpose.

We think that from January, 1957, to July, 1958, is too long a period to be regarded as a reasonable time. This is especially true in this case since the defendants, during all this time, were in possession of facts about which they now complain. One is hardly in a position to repudiate, a year and a half after it, the transaction in which he participated at the time.

What constitutes a "reasonable time" under Rule 60(b) is to be decided under the circumstances of each case. Nevertheless, it is worth pointing out that courts have imposed stricter time limitations than the one invoked here. Gilmore v. Hinman, 1951, 89 U.S.App.D.C. 165, 191 F.2d 652 (16 months); Mayfair Extension, Inc. v. Magee, 1957, 100 U.S.App.D.C. 48, 241 F.2d 453 (12 months); Kahle v. Amtorg Trading Corp., D.C.N.J.1952, 13 F.R.D. 107 (9 months); Helene Curtis Industries v. Dinerstein, D.C.E.D.N.Y.1955, 17 F.R.D. 223 (8 months).

Another reason for supporting the conclusion of the trial judge here is that the matter has been litigated and concluded heretofore. The trial judge made an order on December 2, 1957, requiring the defendants to convey certain lots in Hughes Park. December 12, 1957, the defendants filed a motion to vacate this order. The court decided against them by order of February 26, 1958, having before it at least the other ground alleged here which was directed to the price at which the sale mentioned above was made.*fn3 The appeal from that order was dismissed July 7, 1958. This establishes, we think, the law of the case and it not open to further litigation.*fn4

Rule 52(a) of the Federal Rules of Civil Procedure does not require findings of fact and conclusions of law for cases arising under Rule 60(b).*fn5 Our own decision in Federal Deposit Ins. Corp. v. Alker, 3 Cir., 1956, 234 F.2d 113, is a completely different case from this one. The district court there had granted a new trial without deciding the question of its power to do so under Rule 60(b) and without making any appraisal as to the sufficiency of the so-called after discovered evidence relied upon in the motion for relief. Compare Jones v. Jones, 7 Cir., 1954, 217 F.2d 239.

Here the motion presented no new facts. Nor in the recorded argument made by counsel for the defendants at the hearing is any new fact presented nor is there an offer of testimony to establish any new fact.*fn6 Counsel's opening paragraph in his address to the district court says, "I do not think that it is necessary for me to rehash all the facts, because I know that Your Honor is thoroughly familiar with all the facts. I may have occasion, however, to allude to one or two facts." The court responded, "I have been familiar with them for some years."

The motion came before the same judge who had patiently listened since 1954 to all the controversial points involved in this litigation. It was all familiar ground to him unless something new was to be brought in. And nothing was.

It is quite understandable how individual defendants themselves not guilty of the original embezzlement can wishfully hope for something to happen which will ease the pinch which the ...


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