Nutrien Ag Solutions, Inc. v. Holley

Filing 10

OPINION. Signed by Honorable Judge Myron H. Thompson on 11/15/2023. (am, )

IN THE DISTRICT COURT OF THE UNITED STATES FOR THE
MIDDLE DISTRICT OF ALABAMA, NORTHERN DIVISION
NUTRIEN AG SOLUTIONS,
)
INC., f/k/a Crop
)
Production Services, Inc., )
)
Plaintiff,
)
)
v.
)
)
JOHN T. HOLLEY,
)
)
Defendant.
)

CIVIL ACTION NO.
2:23cv230-MHT
(WO)

OPINION
Plaintiff

Nutrien

Ag

Solutions,

Inc.

filed

this

action for breach of contract against defendant John T.
Holley.

Jurisdiction is proper under 28 U.S.C. § 1332

(diversity).

The

clerk

of

court

previously

entered

default against Holley at the request of Nutrien.

This

cause is now before the court on Nutrien’s motion for
entry of default judgment, which seeks damages in the
amount of $ 144,536.58 (plus interest), attorneys’ fees
in the amount of $ 4,504.25, and costs in the amount of
$ 634.53.

I. DEFAULT JUDGMENT STANDARD
Default alone does not warrant entry of a default
judgment.

See Tyco Fire & Sec. LLC v. Alcocer, 218 F.

App’x 860, 863 (11th Cir. 2007)).
‘an

absolute

confession

by

“[A] default is not

the

defendant

of

his

liability and of the plaintiff’s right to recover,’ but
is instead merely ‘an admission of the facts cited in
the Complaint, which by themselves may or may not be
sufficient

to

establish

a

defendant’s

liability.’”

Capitol Recs. v. Carmichael, 508 F. Supp. 2d 1079, 1083
(S.D.

Ala.

2007)

(Steele,

J.)

(citations

omitted).

However, “[t]he defendant is not held to admit facts
that are not well-pleaded or to admit conclusions of
law.”

Nishimatsu Constr. Co. v. Houston Nat’l Bank,

515 F.2d 1200, 1206 (5th Cir. 1975) (emphasis omitted).1
A default judgment, including the specific nature
and extent of the relief sought, must be adequately

1. In Bonner v. City of Prichard, 661 F.2d 1206,
1209 (11th Cir. 1981) (en banc), the Eleventh Circuit
Court of Appeals adopted as binding precedent all
decisions of the former Fifth Circuit handed down prior
to the close of business on September 30, 1981.
2

supported in the record.

See Anheuser–Busch, Inc. v.

Philpot, 317 F.3d 1264, 1266 (11th Cir. 2003) (“A court
has an obligation to assure that there is a legitimate
basis for any damage award it enters....”).
the

pleadings,

declarations.

a

court

may

consider

Besides

affidavits

and

See Antoine v. Atlas Turner, Inc., 66

F.3d 105, 111 (6th Cir. 1995) (“Use of affidavits in
granting

default

judgments

does

not

violate

...

due

process[.]”).

II.

FACTUAL BACKGROUND

Based on the well pleaded factual allegations of
the complaint and the declarations submitted by Wendy
Glass and Patrick L. W. Sefton in support of the motion
for

default

judgment,

the

court

finds

the

following

facts.
On August 23, 2022, Nutrien and Holley signed a
promissory note that obligated Holley to repay Nutrien
for the value of goods and services it had provided to
his

farming

operation.

Holley

3

owed

Nutrien

$ 297,760.93 in principal, $ 47,121.78 in interest, and
$ 16,888.04 in late charges.

Interest accrued on the

principal balance at a rate of 9 % per annum.

The note

prescribed a payment schedule, under which Holley would
pay down $ 225,000 of the total on September 1, 2022;
October 1, 2022; and November 1, 2022.
maturity

date,

at

which

point

the

The note’s

payment

of

outstanding charges were due, was February 1, 2023.

all
In

the event of default, the note required Holley to pay
Nutrien’s attorneys’ fees and costs.
Holley made one $ 225,000 payment in October 2022
but otherwise failed to pay off the note.

Factoring in

the October payment and interest, he owes Nutrien a
total

of

$ 144,536.58:

$ 72,760.93

in

principal,

$ 54,862.61 in interest, $ 16,888.04 in late charges,
and $ 25.00 in non-sufficient funds fees.2

2. The outstanding principal due under the loan
does not, by itself, satisfy the amount-in-controversy
requirement for the court to exercise diversity
jurisdiction.
However,
the
combination
of
the
outstanding principal and the attorneys’ fees sought by
Nutrien exceeds $ 75,000.
Because the promissory note
provided for the collection of reasonable attorneys’
4

Nutrien filed this lawsuit against Holley on April
25, 2023, seeking to recover the full amount due under
the note, plus fees and costs.

Six days later, Nutrien

served Holley with a summons and copy of the complaint.
See Proof of Service (Doc. 3).

Holley did not answer

the complaint.
On June 30, 2023, Nutrien applied for an entry of
default and filed a motion for default judgment.

The

court of clerk entered default against Holley on August
4, 2023.
point

See Clerk’s Entry of Default (Doc. 7).

during

the

proceedings

to

date

has

At no

the

court

heard from Holley.

III. DISCUSSION
As

an

initial

matter,

the

court

finds

that

a

hearing is not required on Nutrien’s motion for default
judgment.

While “[t]he court may conduct hearings ...

fees, the attorneys’ fees can count toward the
amount-in-controversy requirement.
See Federated Mut.
Ins. Co. v. McKinnon Motors, LLC, 329 F.3d 805, 808 n.4
(11th Cir. 2003) (“The general rule is that attorneys’
fees do not count towards the amount in controversy
unless they are allowed for by statute or contract.”).
5

when, to enter or effectuate judgment, it needs to: ...
determine

the

amount

of

damages,”

Fed.

R.

Civ.

P.

55(b)(2), “Rule 55 does not require that testimony be
presented as a prerequisite to the entry of a default
judgment....”

10A Fed. Prac. & Proc. Civ. § 2688 (4th

ed. (April 2023)).

As the outstanding balance Nutrien

now seeks is clearly supported in the record and does
not require expert evidence or complex calculations,
there is no need for a hearing here.
Rule

55(b)(2)

also

states

that

a

“party

or

its

representative must be served with written notice of
the application at least 7 days before the hearing.”
Nutrien’s

motion

for

default

judgment

was

mailed

to

Holley at his last known address over four months ago.
See Fed. R. Civ. P. 5(b)(2)(C) (permitting service by
“mailing it to the person’s last known address—in which
event service is complete upon mailing”).

Holley has

received sufficient notice under Rule 55(b)(2).
Nutrien

has

breach-of-contract

shown

its

damages

in

6

entitlement
the

amount

to
of

$ 144,536.58,

attorneys’

fees

in

the

amount

$ 4,504.25, and costs in the amount of $ 634.53.
breach-of-contract
principal,

late

damages

fees,

include

nonsufficient

interest as required under the note.

the
funds

of
The

remaining
fees,

and

In addition, the

note provides for the recovery of attorneys’ fees and
costs,

and

attorney

the

declarations

corroborate

the

submitted

amounts

by

Nutrien

Nutrien’s
now

seeks.

After review of the declarations, and, in the absence
of any objection from Holley, the court concludes that
the

hourly

rates

requested

and

time

expended

are

reasonable and necessary to litigate this matter.
Finally,

Nutrien

seeks

the

interest

that

has

accrued between the time it filed its complaint and the
entry of judgment.

Nutrien is entitled to $ 3,819.97,

which reflects interest calculated at a rate of 9 % per
annum for each calendar month that has passed since the
complaint was filed.3

3. The note provides that default interest will
accrue at a rate of 18 % per annum.
However, the
affidavit submitted in support of the motion for entry
7

An appropriate judgment will be entered.
DONE, this the 15th day of November, 2023.
/s/ Myron H. Thompson
UNITED STATES DISTRICT JUDGE

of default judgment states that Nutrien is seeking
default interest at a rate of only 9 % per annum. See
Affidavit of Wendy Glass (Doc. 5-2) ¶ 9.
The court
has, therefore, used the lower of these two interest
rates to calculate the amount of default interest to
which Nutrien is entitled.
8