CAPITAL ONE EQUIPMENT FINANCE CORP. v. JOSEPH
OPINION. Signed by Judge John Michael Vazquez on 7/6/17. (cm, )
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
CAPITAL ONE EQUIPMANT FINANCE
CORP. F/K/A ALL POINTS CAPITAL CORP.
D/B/A CAPITAL ONE TAXI MEDALLION
Civil Action No. 16-9062
John Michael Vazguez, U.S.D.J.
This matter comes before the Court on Plaintiff Capital One Equipment Finance
Corporation’s (“Capital One”) unopposed motion for default judgment against Defendant Nicke
Joseph under fed. R. Civ. P. 55(b)(2). D.E. 13. The Court reviewed all submissions made in
support of the motion, and considered the motion without oral argument pursuant to Fed. R. Civ.
P. 78(b) and L. Civ. R. 78.1(b). For the reasons that follow, Plaintiffs motion is GRANTED.
FACTS AND PROCEDURAL HISTORY
On or about December 10, 2012, Joseph executed and delivered a promissory note in favor
of Capital One in the amount of $250,000 (the “Note”), in connection with a security agreement.
5-6, D.E. 1. The Note provides for interest on the principal at a rate of 5.25% per
annum, and upon default or maturity, at a default rate of 16% per annum until the principal and
any other outstanding obligations are satisfied. Id.
7-8. The Note also provides that in the
event of a default, the borrower agrees to pay all attorneys’ fees, court costs and other expenses
incurred in the enforcement of the agreement. Id.
¶ 10; Ex. B. The loan at issue matured on
January 1, 2016, but Joseph failed to pay all amounts due. As a result, Joseph defaulted under the
Note, and the default rate of 16% per annum was triggered. Id.
¶ 11. Joseph continued to make
partial payments throughout 2016 and 2017, but as of May 17, 2017, he owed a total of
$264,659.32. Affidavit of Tank Hussain (“Hussain Aff.”)
¶J 8-9, D.E. 13-1.
On December 7, 2016, Capital One filed a Complaint against Defendant for breach of the
agreement. Capital One seeks $264,659.32, the outstanding balance on the loan and other fees as
well as its costs of collection, which includes costs associated With this legal action. Compl.
Joseph did not answer, move, or otherwise respond to the Complaint. As a result, the Clerk of the
Court entered default against Joseph on January 6, 2017 for failure to plead or otherwise defend.’
On May 17, 2017, Capital One filed this motion for default judgment. D.E. 13.
LAW AND ANALYSIS
A. Standard of Review
Rule 55 allows for the entry of default against a party that fails to plead or otherwise defend
claims asserted against it. Fed. R. Civ. P. 55. “The entry of a default judgment is largely a matter
of judicial discretion, although the Third Circuit has emphasized that such ‘discretion is not
and [hasi repeatedly state[d] [its] preference that cases be disposed of on the
merits whenever practicable.”. Chanel, Inc. v. Gordashevsky, 558 F. Supp. 2d 532, 535 (D.N.J.
2008) (quoting Hritz v. Woma Corp., 732 f.2d 1178, 1181 (3d Cir. 1984)).
In entering a default judgment, a court must determine whether (1) it has personal and
subject matter jurisdiction; (2) the defendants were properly served; (3) the complaint sufficiently
‘Rule 55(a) directs the Clerk to enter a party’s default when that party “against whom a judgment
for affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by
affidavit or otherwise.” Fed. R. Civ. P. 55(a).
pleads a cause of action; and (4) the plaintiff has proven damages. Days Inns Worldwide, Inc. v.
Jinisha Inc., No. 14-6794, 2015 WL 4508413, at *1 (D.N.J. July 24, 2015). Additionally, a court
must determine the appropriateness of default judgment by weighing (1) the prejudice suffered by
the party seeking default judgment; (2) whether the party subject to the default has a meritorious
defense; and (3) the culpability of the party subject to default. Id at *2.
B. Jurisdiction and Service
When a default judgment is sought against a party that has not filed responsive pleadings,
the court “has an affirmative duty to look into its jurisdiction both over the subject matter and the
parties.” Ramada Worldwide Inc. v. Benton Harbor Han Ohm, L.L.C., No. 05-3452, 2008 WL
2967067, at *9 (D.N.J. July 31, 2008) (quoting Williams v. Lfe Say. & Loan, 802 F.2d 1200, 1203
(10th Cir. 1986)).
Subject Matter Jurisdiction
The Court has subject matter jurisdiction over this matter. Diversity jurisdiction exists
when “the matter in controversy exceeds the sum or value of $75,000
and is between citizens
of different states.” 28 U.S.C. 1332(a). Capital One is a New York corporation with its principal
place of business in Melville, New York. Defendant is domiciled in West Orange, New Jersey.
1-2. In addition, Capital One is claiming $264,659.32 in damages before interest.
8-9. Therefore, the parties are diverse and the amount in controversy is greater
The Court has personal jurisdiction over Defendant. “[Am individual’s domicile, or home,
constitutes the paradigmatic forum for the exercise of general jurisdiction.” Chanel, Inc. v. Matos,
133 F. Supp. 3d 678, 684 (D.N.J. 2015) (internal quotation marks omitted). Here, Plaintiff alleges
that Joseph is a resident of New Jersey. Compi.
Therefore, New Jersey is Joseph’s “home,”
and this Court has personal jurisdiction over him.
Sufficiency of Service
“Before the Court can. enter default judgment, it must find that process was properly served
on the Defendant.” Teamsters Pension Fund ofPhi/a. & Vicinity v. Am. Helper, Inc., No. 11-624,
2011 WL 479023, at *2 (D.N.J. Oct. 5, 2011) (citing Gold Kist, Inc. v. Laurinburg Oil Co., Inc.,
756 F.2d 14, 19 (3d Cir. 1985)). An individual may be served by leaving a copy of the summons
and complaint “at the individual’s dwelling or usual place of abode with someone of suitable age
and discretion who resides there.” Fed. R. Civ. P. 4(e)(2)(B). A copy of the summons was left
with Defendant’s wife, at their residence.2 Compl.
D.E. 5. Therefore, Joseph was properly
C. Sufficiency of Plaintiff’s Causes of Action
Next, the Court must determine whether the complaint states a valid cause of action. The
Court must accept all well-pleaded factual allegations in the pleadings as true, except as to
damages. Chanel, Inc., 558 F. Supp. 2d at 535-36.
Plaintiff states a cause of action for breach of contract. Under New Jersey law, to state a
claim for breach of contract, a plaintiff must allege that there is (1) a valid contract; (2) plaintiff
performed under the contract; (3) defendant’s breach of the contract; and (4) resulting damages.
Lacroce v. M. Fortuna Roofing, Inc., No. 14-7329, 2017 WL 43176$, at *5 (D.N.J. Jan. 31, 2017).
Capital One’s allegations are sufficient. Capital One alleges a valid agreement and that Joseph
breached the agreement by failing to pay the outstanding loan balance upon its maturity. Compl.
The Affidavit of Service states that Joseph was served at his place of business, which according
to the Complaint, is the same address as his residence. See Compl. ¶ 21; D.E. 5. Plaintiffs counsel
clarified that Joseph was served at his home and that he runs his business from his home. D.E. 16.
¶J 1 1-14. Subsequently, Joseph failed to make complete payments as required.
¶ 12. As a
result of this breach, the agreement provides that Joseph is liable for the outstanding amounts
subject to the applicable interest rate as well as attorneys’ fees, court costs, and other expenses
incurred by the Plaintiff in the enforcement of the agreement. Id.
¶ 10. Capital One also
established that it performed under the agreement.
While the factual allegations of the complaint “will be taken as true,” the amount of
damages must still be proven. Comdyne I, Inc. v. Corbin, 90$ f.2d 1142, 1149 (3d Cir. 1990).
Capital One is seeking damages in the amount of the outstanding principal balance, the
accrued interest, the default interest, filing fees, and costs of process server fees. Hussain Aff.
8. These costs totaled $264,659.32 when Plaintiff filed for default judgment. Id. Capital One has
provided adequate documentation indicating that Joseph is liable for the amounts sought. Compl
Ex. A. Defendant has not appeared in this matter, and as a result, there is no evidence before the
Court to contest the accuracy of the damages sought by Plaintiff, which are supported by sufficient
documentation. Accordingly, Plaintiff is entitled to $264,659.32 in damages.
E. Default Judgment Factors
Before imposing the extreme sanction of default judgment, district courts must determine
the appropriateness of default judgment by weighing (1) the prejudice suffered by the party seeking.
default judgment; (2) whether the party subject to the default has a meritorious defense; and (3)
the culpability of the party subject to default. Jinisha, 2015 WL 4508413, at *2.
Here, all three factors weigh in favor of entering default judgment. Capital One would not
be able to recover damages owed according to the agreement, and would be unfairly prejudiced if
no default judgment is entered. Days Inns Worldwide, Inc. v. Ttclsipooja Hosp., LLC, No. 15-
5576, 2016 WL 2605989, at *3 (D.N.J. May 6, 2016); Jinisha, 2015 WL 4508413, at *2. Next,
considering that Defendant has not responded to this matter, “Defendant has put forth no evidence
or facts containing any information that could provide the basis for a meritorious defense.” HICA
Edttc. Loan Corp.
Surikov,No. 141045, 2015 WL273656, at *3 (D.N.J. Jan. 22, 2015). Lastly,
Defendant’s failure to answer, without providing any reasonable explanation, permits the Court to
draw an inference of culpability. Int’l Union ofPainters v. Andrews Window $ervs. LLC, No. 153583, 2016 WL 3234516, at *3 (D.N.J. June 7, 2016). As a result, the Court finds that default
judgment is waffanted.
For the reasons set forth above, Plaintiffs motion for default judgment is GRANTED.
Accordingly, the Court will enter judgment against Defendant in the amount of $264,659.32. An
appropriate Order accompanies this Opinion.
John Michael Vazquez, U.S. .J.
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