TD Bank, N.A. v. Grace Unlimited Ventures, LLC et al

Filing 10

ORDER AND DEFAULT JUDGMENT in favor of Plaintiff against Anthonia O. Emezie, Henry O. Emezie, Grace Unlimited Ventures, LLC, Joy Kids Ventures, LLC. Signed by Chief Judge Frank D. Whitney on 7/17/2014. (eef)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
CHARLOTTE DIVISION
DOCKET NO. 3:14-cv-00279-FDW-DCK
TD BANK, N.A.,
Plaintiff,
vs.
GRACE UNLIMITED VENTURES, LLC,
JOY KIDS VENTURES, LLC, HENRY O.
EMEZIE AND ANTHONIA O. EMEZIE,
Defendants.

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ORDER AND DEFAULT
JUDGMENT

THIS MATTER is before the Court on Plaintiff TD Bank, N.A.’s, (“Plaintiff”) Motion
for Default Judgment pursuant to Fed. R. Civ. P. 55(b)(2) (Doc. No. 8). For the reasons set forth
below, Plaintiff’s Motion is GRANTED.
On May 30, 2014, Plaintiff filed suit against Grace Unlimited Ventures, LLC, Joy Kids
Ventures, LLC, Henry O. Emezie, and Anthonia O. Emezie (collectively “Defendants”) alleging
default on two promissory notes. Based on the record before it, the Court finds that the
Defendants Grace Unlimited Ventures, LLC and Joy Kids Ventures, LLC were properly served
with the summons and complaint in this action on June 4, 2014. (Doc. No. 6). Also, the court
finds that Defendants Henry O. Emezie and Anthonia O. Emezie were properly served with the
summons and complaint in this action on June 6, 2014. (Id.) Further, it appears as though this
Court has subject matter jurisdiction over this matter pursuant to 28 U.S.C. § 1331 and 28 U.S.C.
§ 1267, and personal jurisdiction over Defendants pursuant to their contractual agreement with
Plaintiffs. (Doc. No. 1, exhibit 2-9). Defendants are not infants or incompetents. Defendants
have nonetheless failed to answer or otherwise defend the action within the time permitted by the

Federal Rules of Civil Procedure.

Pursuant to Fed. R. Civ. P. 55(a), the Clerk entered

Defendants’ default on July 8, 2014. (Doc. No. 9). Plaintiff now requests default judgment on its
claims, plus an award of attorney’s fees.
LEGAL STANDARD
The award of default judgment is governed by Rule 55 of the Federal Rules of Civil
Procedure, which provides in relevant part that “[w]hen a 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, the clerk must enter the party's default.” Fed. R. Civ. P. 55(a).
The Fourth Circuit has “repeatedly expressed a strong preference that, as a general
matter, defaults be avoided and that claims and defenses be disposed of on their merits.”
Colleton Preparatory Acad., Inc. v. Hoover Univ., Inc., 616 F.3d 413, 417 (4th Cir. 2010)
(citations omitted). Nonetheless, default judgment “may be appropriate when the adversary
process has been halted because of an essentially unresponsive party.” SEC v. Lawbaugh, 359 F.
Supp. 2d 418, 421 (D. Md. 2005).
If the court finds that liability is established, it must then determine damages. Carter
Behavior Health, 2011 WL 5325485, at *4 (citing Ryan, 253 F.3d at 780-81; Gaines, 635 F.
Supp. 2d at 416-17). The court must make an independent determination regarding damages and
cannot accept as true factual allegations of damages. Id. (citing Lawbaugh, 359 F. Supp. 2d at
422). While the court may conduct an evidentiary hearing to determine damages, it is not
required to do so but may rely instead on affidavits or documentary evidence in the record to
determine the appropriate sum. See E.E.O.C. v. North Am. Land Corp., No. 1:08–cv–501, 2010
WL 2723727, at *2 (W.D.N.C. Jul.8, 2010).

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ANALYSIS
To determine damages on these two claims the court relies on affidavits and documentary
evidence in the record. (Doc. No. 1, Exhibit 2-14).
A. Claims for Default on the Notes
This Court finds in favor of Plaintiff TD Bank N.A. and against Defendants Grace
Unlimited Ventures, LLC, Joy Kids Ventures, LLC, Henry O. Emezie, and Anthonia O. Emezie,
jointly and severally, for Default on the First Note, in the sum of $1,193,863.85, plus interest at
the rate $168.41 per day from and after May 2, 2014 until date of entry of judgment and
thereafter at the legal rate until paid in full. For Default on the Second Note, this Court finds in
favor of Plaintiff TD Bank N.A. and against Defendants Grace Unlimited Ventures, LLC, Joy
Kids Ventures, LLC, Henry O. Emezie, and Anthonia O. Emezie, jointly and severally, in the
sum of $74,775.64, plus interest at the rate of $13.00 per day from and after May 2, 2014 until
date of entry of judgment and thereafter at the legal rate until paid in full.
B. Attorney’s Fees
Plaintiff also requests attorney’s fees pursuant to N.C. Gen.Stat. § 6-21.2. Under North
Carolina law, a party generally cannot recover attorney’s fees “unless such a recovery is
expressly authorized by statute.” Stillwell Enters., Inc. v. Interstate Equip. Co., 300 N.C. 286,
289, 266 S.E.2d 812, 814 (1980). Section 6–21.2 of the North Carolina General Statute allows
for an award of attorneys' fees in actions to enforce obligations owed under a promissory note or
other “evidence of indebtedness” that itself provides for payment of attorney’s fees. Section 621.2 further provides that when a note or other evidence of indebtedness provides for the
payment of reasonable attorneys' fees by the debtor without specifying any specific percentage,

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“such provision shall be construed to mean fifteen percent (15%) of the ‘outstanding balance’
owing on said note . . . .” N.C. Gen.Stat. § 6–21.2(2). Section 6–21.2 also requires a creditor to
notify all parties sought to be held on the obligation that the creditor will seek to enforce the
attorney’s fees provision contained in the note or other evidence of indebtedness and that if the
party pays the outstanding balance within five days from the mailing of such notice, then the
attorney’s fee obligation shall be void. N.C. Gen.Stat. § 6–21.2(5). Where “the provisions in the
Note and Guaranties regarding payment of attorneys' fees are valid and enforceable and where
neither Defendant has paid the outstanding balance on the Note, the Plaintiff is entitled to
recover from the Defendants its attorneys' fees in an amount of 15% of the outstanding balance
of the Note at the time that suit was filed. . . .” FDIC v. Dion Holdings, LLC, No. 1:11–cv–
00083, 2012 WL 6212655, at *4 (W.D.N.C. Dec.13, 2012).
Since the notes and guaranties do not specify an amount of fees to be awarded, Plaintiff is
entitled to recover attorney’s fees in an amount equal to 15% of the outstanding balance of the
note. Additionally, demand was made upon Defendants by letter dated May 6, 2014, but
Defendants have failed and refused to pay both notes. (Doc. No. 1, Exhibit 10). Pursuant to
Section 6-21.2(5), Plaintiff’s letter made demand for payment of the remaining Notes
indebtedness. This letter also notified Defendants that Plaintiff intended to collect attorney’s fees
if payment of the outstanding balances were not made within five days from the date of said
notification. The outstanding balances have not been paid and more than five days have elapsed
since the mailing of said notification. Therefore, the court awards for Default on the First Note,
$179,786.90 in reasonable attorneys’ fees, which is 15% of the outstanding indebtedness due and
owing at the time suit was instituted on May 30, 2014. For Default on the Second Note, the court

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awards $11,270.95 in reasonable attorneys’ fees, which is 15% of the outstanding indebtedness
due and owing at the time suit was instituted on May 30, 2014.
CONCLUSION
Judgment is hereby entered in favor of Plaintiff TD Bank N.A. and against Defendants
Grace Unlimited Ventures, LLC, Joy Kids Ventures, LLC, Henry O. Emezie, and Anthonia O.
Emezie, jointly and severally, for Default on the First Note, in the sum of $1,193,863.85, plus
interest at the rate of $168.41 per day from and after May 2, 2014 until date of entry of judgment
and thereafter at the legal rate until paid in full, plus $179,786.90 in reasonable attorneys’ fees.
For Default on the Second Note, judgment is hereby entered in favor of Plaintiff TD Bank N.A.
and against Defendants Grace Unlimited Ventures, LLC, Joy Kids Ventures, LLC, Henry O.
Emezie, and Anthonia O. Emezie, jointly and severally, in the sum of $74,775.64, plus interest at
the rate of $13.00 per day from and after May 2, 2014 until date of entry of judgment and
thereafter at the legal rate until paid in full, plus $11,270.95 in reasonable attorneys’ fees.
Accordingly, Defendants are jointly and severally liable to Plaintiff for $1,459,697.34, which is
the total of $1,193,863.85 for Default on the First Note, $74,775.64 for Default on the Second
Note, and $191,057.85 in attorney’s fees.
IT IS, THEREFORE, ORDERED that Plaintiff’s Motion for Default Judgment (Doc. No.
8), is GRANTED. The Clerk’s Office is respectfully directed to enter judgment in Plaintiff’s
favor in the amount of $1,459,697.34 and to CLOSE THE CASE.
IT IS SO ORDERED.
Signed: July 17, 2014

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