BMO Harris Bank N.A. v. Alton Bean Trucking, Inc. et al
JUDGMENT granting 12 Motion for Default Judgment filed by BMO Harris Banks N.A. against Alton Bean Trucking, Inc. and Gary Bean in the amount of $613,505.59 as of April 3, 2017, with pre-judgment interest to accrue at a rate of $286.37 pe r diem until judgment is entered, plus reasonable attorneys fees and costs in the amount of $22,572.24 incurred, for a total judgment amount of $636,077.83, as set forth. Further, Ordering the return or removal, delivery and credit of Retained Collateral, as set forth. See Judgment for specifics. Signed by Honorable Susan O. Hickey on April 11, 2017. (mjm) Modified on 4/11/2017 to edit text (mjm).
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
HOT SPRINGS DIVISION
BMO HARRIS BANK N.A.
Case No. 6:16-cv-6118
ALTON BEAN TRUCKING, INC.
and GARY BEAN
Before the Court is Plaintiff BMO Harris Bank N.A. (“Plaintiff”)’s Motion for Default
Judgment. (ECF No. 12). Defendants Alton Bean Trucking, Inc. (“ABT”) and Gary Bean
(“Bean”) have not responded to the motion, and the time to do so has passed. On April 6, 2017,
the Court held a hearing on Plaintiff’s motion. (ECF No. 17). The Court finds the matter ripe
On November 23, 2016, Plaintiff filed this lawsuit against ABT and Bean, alleging that
ABT and Bean are in default under certain loan agreements and guaranties for failure to pay the
amounts due thereunder, and seeking replevin, specific performance, injunctive relief, and
breach-of-contract damages. Despite valid service of the complaint, ABT and Bean failed to file
an answer or other responsive pleading. On April 4, 2017, the Clerk of Court entered default
against ABT and Bean. (ECF No. 16). Plaintiff now asks the Court to render default judgment
against ABT and Bean. (ECF No. 12).
II. DEFAULT JUDGMENT
A district court may enter a default judgment when a party fails to appropriately respond
in a timely manner. See, e.g., Inman v. Am. Home Furniture Placement, Inc., 120 F.3d 117, 119
(8th Cir. 1997). If the court determines that a defendant is in default, the factual allegations of
the complaint, except those relating to the amount of damages, will be taken as true. Everyday
Learning Corp. v. Larson, 242 F.3d 815, 818 (8th Cir. 2001). However, the court must ensure
that “the unchallenged facts constitute a legitimate cause of action” prior to entering final
judgment. See Murray v. Lene, 595 F.3d 868, 871 (8th Cir. 2010).
ABT entered into loan agreements (the “Agreements”) with General Electric Capital
Corporation (“GECC”) in 2011, 2012, and 2013, and with GE Capital Commercial, Inc. in 2012
(“GE Commercial,” and together with GECC, “GE Capital”) for the purchase of certain tractors
The tractors and trailers identified in the Agreements served as collateral
(collectively, the “Collateral”). ABT granted GE Capital a first-priority security interest in the
Collateral, which GE Capital properly perfected by possessing the Certificates of Title. Bean
guaranteed the past, present, and future performance of ABT under the Agreements, including
the payment of all amounts owed (the “Guaranties”).
Effective December 1, 2015, GE Capital transferred and assigned to Plaintiff all of their
rights, titles, and interests in and to their accounts with ABT, including without limitation, the
Agreements, the Guaranties, and GE Capital’s security interest in the Collateral. Plaintiff is GE
Capital’s successor-in-interest with respect to all rights, claims, and interests related to ABT and
Bean in this action. Thus, the Agreements are valid and fully enforceable contracts between
Plaintiff and ABT.
Plaintiff performed all terms and conditions to be performed under the Agreements. ABT
defaulted under the Agreements for its failure to pay the amounts due thereunder.
defaulted under the Guarantees for his failure to pay the amounts due under the Agreements and
the Guarantees. The Agreements provide that, upon default, ABT is obligated to immediately
turn over possession of the Collateral to Plaintiff. Plaintiff has recovered some, but not all, of the
Collateral. The Agreements also provide that, upon default, Plaintiff is entitled to recover
interest on all unpaid amounts; late charges and other fees; costs of retaking, holding, and
disposing of the Collateral; and reasonable attorneys’ fees and costs incurred in enforcing
The Court has read the pleadings and the papers on file and accordingly finds that
Plaintiff has demonstrated sufficient facts to support legitimate causes of action against ABT and
After determining that a judgment by default should be entered, the Court should
determine the amount and character of the recovery. Fed. R. Civ. P. 55(b)(2)(B); see also Am.
Red Cross v. Cmty. Blood Ctr., 257 F.3d 859, 864 (8th Cir. 2001) (“[W]hen a default judgment is
entered on a claim for an indefinite or uncertain amount of damages, facts alleged in the
complaint are taken as true, except facts relating to the amount of damages, which must be
proved in a supplemental hearing or proceeding.”) (internal quotation marks omitted). Because
the damages in this case were uncertain, the Court held a hearing to determine the appropriate
At the hearing, Plaintiff’s counsel presented the Court with an Affidavit of
Indebtedness, as well as affidavits regarding attorneys’ fees and costs.
The Agreements provide that, upon default, ABT is obligated to immediately turn over to
Plaintiff possession of the Collateral. Pursuant to the Agreements, upon default, Plaintiff has the
right to “enter any premises where the [Collateral] may be without judicial process and take
possession thereof.” Certain Collateral has been returned to or repossessed by Plaintiff. The
items have been liquidated and the net proceeds applied to the indebtedness owed.
continues to possess eleven units of Collateral (“the Retained Collateral”).
Collateral includes the following:
Under the Agreements, in the event of default by ABT: (1) ABT is obligated to return
the Retained Collateral at its expense and to any location that Plaintiff directs; (2) Plaintiff is
entitled to take possession of the Retained Collateral or direct ABT to remove it to a place
deemed convenient by Plaintiff; and (3) Plaintiff is entitled to repossess and remove the Retained
Collateral, wherever located. Despite demand, ABT has failed to cure its defaults under the
Agreements and has failed to return the Retained Collateral. The Retained Collateral depreciates
and deteriorates as a result of its continued use by ABT, with no commensurate value being
conferred to Plaintiff in the form of payments due and owing from ABT.
The Court finds that Plaintiff is entitled to immediate possession of all Collateral,
including the Retained Collateral. This Default Judgment shall include an Order of Delivery that
all Collateral, including the Retained Collateral, be returned and surrendered to Plaintiff. If not,
the U.S. Marshall or Sherriff of the appropriate county shall assist Plaintiff in taking possession
of the same.
B. Interest, Late Charges, Repossession Fees, Attorneys’ Fees and Costs
The Agreements also provide that, upon default, ABT is obligated to pay: (1) interest on
all unpaid amounts at the rate of eighteen percent (18%) per annum or the maximum rate not
prohibited by applicable law; (2) late charges and other fees due under the Agreements; (3) all
expenses of retaking, holding, preparing for sale, and selling the Collateral; (4) reasonable
attorneys’ fees and costs incurred by Plaintiff in the enforcement of its rights, including this
lawsuit. Calculated as of April 3, 2017, the amount due and owing under the Agreements,
including accrued and unpaid interest and late fees, repossession fees, and other fees, but not
including attorneys’ fees, totals $613,505.59. Interest accrues on the principal amount at the rate
of $286.37 per diem. The Court finds that Plaintiff is entitled to recover this amount.
The Court now turns to the sought-after attorneys’ fees and costs. Plaintiff’s affidavits
indicate that as of March 31, 2017, local counsel, Mitchell, Williams, Selig, Gates & Woodyard,
P.L.L.C.’s, fees and costs associated with this matter total $7,621.23. The affidavits also show
that, of April 4, 2017, lead counsel, Reed Smith LLP’s, fees and costs associated with this matter
total $15,546.01. Lead counsel’s affidavit regarding attorneys’ fees and costs stated that the fees
charged were equal or below the reasonable, customary rate charged for similar work in Chicago,
In determining the reasonableness of an attorneys’ fee award, a “district court [is]
required to first calculate a lodestar, by multiplying the number of hours reasonably expended on
litigation by a reasonable hourly rate, and to then consider whether the lodestar amount should be
reduced, based on appropriate considerations.” Jones v. RK Enters. of Blytheville, Inc., 632 Fed.
Appx. 306, 307 (8th Cir. 2016) (citing Hensley v. Eckerhart, 461 U.S. 424, 433-34 (1983)). A
“reasonable” hourly rate is usually the ordinary rate for similar work in the community where the
case has been litigated. Fish v. St. Cloud State Univ., 295 F.3d 849, 851 (8th Cir. 2002). The
United States Supreme Court has set forth twelve factors to be considered when making a
lodestar determination: (1) time and labor required; (2) novelty and difficulty of the questions;
(3) skill requisite to perform the legal service properly; (4) preclusion of other employment, due
to acceptance of case; (5) the customary fee; (6) whether the fee is fixed or contingent; (7) time
limitations imposed by the client or the circumstances; (8) the amount involved and the results
obtained; (9) the experience, reputation, and ability of the attorneys; (10) the undesirability of the
case; (11) the nature and length of the professional relationship with the client; and (12) awards
in similar cases. Hensley, 461 U.S. at 430 n.3.
Although Plaintiff does not offer any evidence as to the prevailing rate in the community
for services similar to those performed in this case, “courts may draw on their own experience
and knowledge of prevailing market rates” in determining a reasonable rate. Warnock v. Archer,
397 F.3d 1024 (8th Cir. 2005). The Court has reviewed Plaintiff’s affidavits regarding attorneys’
The affidavit listed five lead-counsel attorneys as having billed time on this case: one billing 0.6 hours at a rate of
$175.00/hour, one billing 0.8 hours at a rate of $185.00/hour, one billing 33.6 hours at a rate of $235/hour, one
billing 0.5 hours at a rate of $370.00/hour, and one billing 8 hours at a rate of $370.00/hour.
fees and costs, and finds the sought-after amounts to be reasonable in Hot Springs, Arkansas, the
community where this case was litigated, with exception of two lead-counsel attorneys who
billed time at a rate of $370.00/hour. The Court finds that $370.00/hour is not a reasonable rate
for similar work in the community where this case was litigated. Thus, the Court will reduce
these two attorneys’ billed rates to $300.00/hour, which the Court finds to be a reasonable rate.
Accordingly, the Court finds that Plaintiff is entitled to recover $14,951.01 for its lead
counsel’s reasonable attorneys’ fees and costs, and $7,621.23 for its local counsel’s reasonable
attorneys’ fees and costs, for a combined total of $22,572.24.
In light of ABT and Bean’s default and the nature of Plaintiff’s claims against them, the
Court finds that Plaintiff’s Motion for Default Judgment (ECF No. 12) should be and hereby is
GRANTED. Accordingly, the Court orders as follows:
It is ORDERED, ADJUDGED, AND DECREED that BMO Harris Bank N.A. is
entitled to default judgment and therefore have judgment against Alton Bean Trucking, Inc. and
Gary Bean in the amount of $613,505.59 as of April 3, 2017, with pre-judgment interest to
accrue at a rate of $286.37 per diem until judgment is entered, plus reasonable attorneys’ fees
and costs in the amount of $22,572.24 incurred in attempting to collect the indebtedness, for a
total judgment amount of $636,077.83, with post-judgment interest continuing to accrue until
judgment is paid in full.
It is further ORDERED, ADJUDGED, AND DECREED that Alton Bean Trucking,
Inc. specifically perform its obligations under the Agreements and return or allow the removal of
the Retained Collateral.
It is further ORDERED, ADJUDGED, AND DECREED that this Default Judgment
shall constitute an Order of Delivery and Alton Bean Trucking, Inc. and Gary Bean shall deliver
all Collateral, including the Retained Collateral, to BMO Harris Bank N.A. If not, the U.S.
Marshall or appropriate Sheriff shall assist BMO Harris Bank N.A. in gaining possession.
It is further ORDERED, ADJUDGED, AND DECREED that any subsequent sale or
disposition of the Collateral, including the Retained Collateral, shall be a credit to this judgment
IT IS SO ORDERED, this 11th day of April, 2017.
/s/ Susan O. Hickey
Susan O. Hickey
United States District Judge
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