Wells Fargo Bank, N.A. v. Planetta Custom Homes, LLC et al

Filing 12

ORDER denying Plaintiff's Motion 11 for Default Judgment. The Clerk's Entry of Default 9 is set aside. Plaintiff is granted forty-five (45) days from the date of this Order to perfect service on Defendants. Signed by District Judge Halil S. Ozerden on 01/22/2013 (HM)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
WELLS FARGO BANK, N.A.

PLAINTIFF

v.

Civil Action No. 1:12-cv-213-HSO-RHW

PLANETTA CUSTOM HOMES, LLC,
VICTOR M. PLANETTA, and
EILEEN PLANETTA

DEFENDANTS

ORDER DENYING PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT
AND SETTING ASIDE CLERK’S ENTRY OF DEFAULT
BEFORE THE COURT is Plaintiff Wells Fargo Bank, N.A.’s Motion [11] for
Default Judgment against Defendants Planetta Custom Homes, LLC, Victor M.
Planetta, and Eileen Planetta. After due consideration of Plaintiff’s Motion, the
record, and the relevant law, the Court is of the opinion that Plaintiff’s Motion [11]
for Default Judgment should be denied, and that the Clerk’s Entry of Default [9]
should be set aside.
I. BACKGROUND
On July 5, 2012, Plaintiff Wells Fargo, Bank, N.A. successor by merger to
Wachovia Bank, N.A.,1 filed its Complaint [1] against Defendants Planetta Custom
Homes, LLC, Victor M. Planetta, and Eileen Planetta, alleging that they are
indebted to it by virtue of Planetta Homes, LLC’s default on a promissory note.
Plaintiff requests judgment in its favor against Defendants “in the amount of
$2,836,325.22, plus pre-judgment interest accruing from June 5, 2012, to the date of
judgment at the contract rate, post-judgment interest, plus attorneys’ fees and costs,
and for such other, further, and different relief as this Court deems just and proper
1

Aff. of Harrison Adams [11-1], Ex. 1 to Pl.’s Mot. for Default J. [11] at p. 3.

under the circumstances.” Pl.’s Compl. [1] at p. 6.
On August 2, 2012, Plaintiff filed Proofs of Service [5][6][7], indicating that it
had served Defendants by certified mail. Attached to the Proofs of Service are
return receipts reflecting that “M. Owens” accepted delivery on behalf of all three
Defendants on July 24, 2012, at an address in Pass Christian, Mississippi. On
September 4, 2012, Plaintiff applied [8] for a Clerk’s entry of default against
Defendants, and a Clerk’s Entry of Default [9] was entered on September 5, 2012.
Plaintiff has now moved for a Default Judgment against Defendants, jointly and
severally.
II. DISCUSSION
“Default judgments are a drastic remedy, not favored by the Federal Rules
and resorted to by courts only in extreme situations.” Sun Bank of Ocala v. Pelican
Homestead & Savs. Ass’n, 874 F.2d 274, 276 (5th Cir. 1989). “[T]hey are available
only when the adversary process has been halted because of an essentially
unresponsive party.” Id. (internal citations omitted). A defendant must be properly
served pursuant to Federal Rule of Civil Procedure 4 in order to be held accountable
for failing to plead or otherwise defend. Rogers v. Hartford Life & Acc. Ins. Co., 167
F.3d 933, 940 (5th Cir. 1999). Absent proper service of process, a district court lacks
jurisdiction over a defendant. Id. A default judgment granted under such
circumstances is void. Id.
The record contains insufficient proof that Plaintiff has effected proper service
of process upon Defendants. The Federal Rules of Civil Procedure provide that

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individuals and limited liability corporations, such as Defendants here, may be
served “following state law for serving a summons in an action brought in courts of
general jurisdiction in the state where the district court is located or where service is
made.” Fed. R. Civ. P. 4(e)(1) and (h)(1)(A). Mississippi Rule of Civil Procedure
4(c)(5) provides that a plaintiff may use certified mail, return receipt requested, to
serve “a person outside this state.” The Comments to Mississippi Rule of Civil
Procedure 4 explain that “[t]he certified mail procedure is not available to serve a
person within the state.” “Rule 4(d) which is entitled ‘Summons and Complaint:
Person to be served,’ specifically identifies the ‘person’ the plaintiff must serve with
process based on the type of defendant involved in the case.” Rogers, 167 F.3d at
941.
[s]ervice . . . shall be made . . . [u]pon a domestic or foreign
corporation or upon a partnership or other unincorporated
association which is subject to suit under a common name,
by delivering a copy of the summons and of the complaint to
an officer, a managing or general agent, or to any other
agent authorized by appointment or by law to receive service
of process.
Miss. R. Civ. P. 4(d)(4). Because Plaintiff attempted to serve “persons” within the
State, the certified mail method of service described in Rule 4(c)(5) was not effective
as to them, and the Court lacks jurisdiction over Defendants.
Even if this method of service was permissible here, at a minimum, service
upon the individual Defendants would still not be effective. Mississippi Rule of Civil
Procedure 4(c)(5) provides that “[w]here the defendant is a natural person, the
envelope containing the summons and complaint shall be marked ‘restricted

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delivery.’” Miss. R. Civ. P. 4(c)(5)(emphasis added). The individually named
defendant must sign for the certified letter addressed to him or her. Here, the
certified letters addressed to Victor M. Planetta and Eileen Planetta were not
mailed “restricted delivery” and were not signed by them. “M. Owens” signed the
return receipts. As such, Plaintiff’s attempted service upon the individual
Defendants was insufficient. Moreover, it is not apparent from the record that “M.
Owens” is authorized as “an officer, a managing or general agent, or any other agent
authorized by appointment or by law to receive service of process” on behalf of
Planetta Custom Homes, LLC. Miss. R. Civ. P. 4(d)(4); see Rogers, 167 F.3d at 941.
It is therefore not evident that Plaintiff’s attempted service upon Planetta Custom
Homes, LLC, was sufficient. For these reasons, Plaintiff’s Motion [11] for Default
Judgment must be denied, and the Clerk’s Entry of Default [9] should be set aside
for “good cause.” Fed. R. Civ. P. 55(c); see Lacy v. Sitel Corp., 227 F.3d 290, 291-92
(5th Cir. 2000).
Federal Rule of Civil Procedure 4(m) provides: “[i]f a defendant is not served
within 120 days after the complaint is filed, the court – on motion or on its own after
notice to the plaintiff – must dismiss the action without prejudice against that
defendant or order that service be made within a specified time.” The Court, in its
discretion, will allow Plaintiff forty-five (45) days from the date of this Order to
perfect proper service of process on Defendants and to file into the record notice of
said service.

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III. CONCLUSION
IT IS, THEREFORE, ORDERED AND ADJUDGED that, Plaintiff Wells
Fargo Bank, N.A.’s Motion [11] for Default Judgment, is DENIED.
IT IS, FURTHER, ORDERED AND ADJUDGED that, the Clerk’s Entry of
Default [9] is SET ASIDE.
IT IS, FURTHER, ORDERED AND ADJUDGED that, Plaintiff Wells
Fargo Bank, N.A., is granted forty-five (45) days from the date of this Order to
perfect service on Defendants Planetta Custom Homes, LLC, Victor M. Planetta, and
Eileen Planetta, in accordance with Federal Rule of Civil Procedure 4, and to file
into the record notice of said service.
SO ORDERED AND ADJUDGED, this the 22nd day of January, 2013.

s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE

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