United States of America v. Lewis

Filing 10

MEMORANDUM (Order to follow as separate docket entry). Signed by Honorable Yvette Kane on 5/30/17. (rw)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
UNITED STATES OF AMERICA,
Plaintiff
v.
GLORIA H. LEWIS,
Defendant

:
:
:
:
:
:
:

No. 1:16-cv-01694
(Judge Kane)

MEMORANDUM
Before the Court is Plaintiff’s motion for default judgment. (Doc. No. 6.) As Defendant
has yet to appear or defend in this action, no opposition to the motion has been filed. For the
reasons that follow, the Court will grant the motion and enter default judgment in favor of
Plaintiff.
I.

BACKGROUND
On August 15, 2016, the United States of America (“Plaintiff”), instituted the instant

mortgage foreclosure action by filing a complaint against Defendant Gloria H. Lewis to foreclose
on certain real property located at 8 East Locust Lane, New Oxford, Pennsylvania 17350 (“the
Property”). (Doc. No. 1.) The complaint alleges that Plaintiff, acting through the Under
Secretary of Rural Development, on behalf of the Rural Housing Service of the United States
Department of Agriculture, loaned Defendant the sum of $85,900.00 on December 29, 1995,
pursuant to Title V of the Housing Act of 1949, as amended, 42 U.S.C. § 1471, et seq., to finance
the purchase of the Property, evidenced by a promissory note (the “note”), executed and
delivered to Plaintiff the same day. (Id. ¶¶3-4.) As security for payment on the note, Defendant
executed and acknowledged a real estate mortgage (the “mortgage”), granting, conveying, and
mortgaging the Property to Plaintiff. (Id. ¶ 5.) The real estate mortgage was duly recorded on
1

January 2, 1996, with the Office of the Recorder of Deeds in Adams County, Pennsylvania. (Id.)
Plaintiff remains the owner and holder of the note and mortgage. (Id. ¶ 6.)
According to the complaint’s allegations, the note and mortgage are presently in default,
as Defendant has failed to tender installments of the principal and interest when due, remit real
estate taxes when due, and maintain the security of the Property. (Id. ¶ 8.) By Plaintiff’s
calculation, the amounts due and owing on the note and mortgage as of the date of the complaint
are as follows:

PRINCIPAL BALANCE

$69,688.75

Interest from 10/28/2012 to 05/02/2016 at 7.5000%

$18,357.82

Interest Recapture

$46,885.04

Late Charges

$547.14
$135,478.75

Fees Required with Payoff Funds Fees
Currently Assessed

+ $1,020.61
+ $11,973.46
$148,472.82

(Id. ¶ 10.) Due to Defendant’s purported default in the performance of her obligations under the
note and mortgage, Plaintiff elected to declare the entire amount of indebtedness, secured by the
mortgage and evidenced by the note, immediately due and payable. (Id. ¶ 9.) A notice of its
intention to foreclose was subsequently mailed to Defendant’s last known address via certified
mail. (Id. ¶ 11.)
A review of the docket reveals that Defendant waived service of a summons in the abovecaptioned action on August 18, 2016. (Doc. No. 4.) Despite executing a formal waiver of
service, Defendant failed to appear, answer, move, or otherwise respond to Plaintiff’s complaint
within sixty (60) days from receipt of service, precipitating Plaintiff’s filing of a request with the
2

Clerk of Court to enter default against Defendant pursuant to Federal Rule of Civil Procedure
55(a). (Doc. No. 5.) On October 26, 2016, the Clerk entered default against Defendant. (Doc.
No. 9.) Concurrently with the Clerk’s entry of default, Plaintiff filed a motion for the entry of
default judgment against Defendant (Doc. No. 6), together with a brief in support thereto (Doc.
No. 7), and affidavit of non-military service (Doc. No. 8).
As Defendant has not responded to the pending motion for default judgment, the Court
deems Plaintiff’s motion for default judgment unopposed. Accordingly, this matter is now ripe
for disposition.
II.

STANDARD OF REVIEW
Default judgments are governed by a two-step process set forth under Rule 55 of the

Federal Rules of Civil Procedure. An entry of default by the Clerk of Court under Rule 55(a) is a
prerequisite to a later entry of a default judgment under Rule 55(b). 10A Charles Alan Wright &
Arthur R. Miller, Federal Practice and Procedure § 2682 (3d ed. 2007) (“Prior to obtaining a
default judgment under either Rule 55(b)(1) or Rule 55(b)(2), there must be an entry of default as
provided by Rule 55(a).”). Once the Clerk of Court has entered a default, the party seeking the
default may then move the court to enter a default judgment under Rule 55(b)(2). Entry of
default does not entitle a claimant to default judgment as a matter of right. 10 James Wm. Moore
et al., Moore’s Federal Practice § 55.31 (Matthew Bender ed. 2010). Indeed, it is well settled
that decisions relating to the entry of default judgments are committed to the sound discretion of
the district court. Emcasco Ins. Co.v. Sambrick, 834 F.2d 71, 74 (3d Cir. 1987).
Three factors control the exercise of the district court’s discretion in assessing whether
default judgment should be granted following the entry of default: “(1) prejudice to the plaintiff
3

if default is denied, (2) whether the defendant appears to have a litigable defense, and (3)
whether defendant’s delay is due to culpable conduct.” Chamberlain v. Giampapa, 210 F.3d
154, 164 (3d Cir. 2000) (citing United States v. $55,518.05 in U.S. Currency, 728 F.2d 192, 195
(3d Cir. 1984)). Yet, if the defendant has been properly served but fails to appear, plead, or
defend an action, a court may “enter a default judgment based solely on the fact that the default
occurred,” without considering the Chamberlain factors. Anchorage Assocs. v. Virgin Islands
Bd. of Tax Review, 922 F.2d 168, 177 n.9 (3d Cir. 1990).
“A finding that default judgment is appropriate, however, is not the end of the inquiry.”
Martin v. Nat’l Check Recovery Servs., LLC, No. 12-1230, 2016 WL 3670849, at *1 (M.D. Pa.
July 11, 2016). Prior to entering a default judgment, the Court must also determine whether the
“unchallenged facts constitute a legitimate cause of action.” Wright et al., supra, at § 2688;
Broad. Music, Inc. v. Spring Mount Area Bavarian Resort, Ltd., 555 F. Supp. 2d 537, 541 (E.D.
Pa. 2008) (“Consequently, before granting a default judgment, the Court must . . . ascertain
whether the unchallenged facts constitute a legitimate cause of action, since a party in default
does not admit mere conclusions of law.”) (citations omitted). In conducting this inquiry, “the
well-pleaded, factual allegations of the complaint . . . are accepted as true and treated as though
they were established by proof.” E. Elec. Corp. of N.J. v. Shoemaker Const. Co., 652 F. Supp.
2d 599, 605 (E.D. Pa. 2009) (citation omitted). While the Court must accept as true the wellpleaded factual allegations of the complaint, the Court need not accept the moving party’s factual
allegations or legal conclusions relating to the amount of damages. Comdyne I, Inc. v. Corbin,
908 F.2d 1142, 1149 (3d Cir. 1990).

4

III.

DISCUSSION
Having reviewed the record, including Plaintiff’s complaint, motion, supporting brief,

exhibits and accompanying affidavits, the Court finds that entry of default judgment against
Defendant and in favor of Plaintiff is appropriate. As an initial matter, the Court observes that
Plaintiff’s unchallenged allegations in the complaint, taken as true, state a legitimate cause of
action for mortgage foreclosure, as Plaintiff has shown “the existence of an obligation secured by
a mortgage, and a default on that obligation.” United States v. Sourbeer, No. 1:16-CV-1161,
2016 WL 5373641, at *1 (M.D. Pa. Sept. 26, 2016) (quoting United States v. Abell, No. 1:09CV-715, 2012 WL 27627, at *2 (M.D. Pa. Jan. 9, 2012)). Moreover, Plaintiff has offered
support for its claim for a sum certain of $148,472.82 in the relevant documents and affidavit
accompanying the request for default judgment. (Doc. Nos. 1-2, 6); Sourbeer, 2016 WL
5373641, at *2 (“There are no damages, as Plaintiff seeks a foreclosure of the promissory note
and mortgage, and repayment of the loan, interest, and fees . . . . This amount is a sum certain, as
‘no doubt remains as to the amount to which a plaintiff is entitled as a result of the defendant’s
default.’”).
Furthermore, the Court finds that the three Chamberlain factors weigh in favor of
entering default judgment against Defendant. First, Plaintiff will be prejudiced if the Court
declines to enter default judgment, as Plaintiff is unable to proceed with the action due to
Defendant’s failure to respond and has no other means of recovering against Defendant. See
Broad. Music, Inc. v. Kujo Long, LLC, No. 14-449, 2014 WL 4059711, at *2 (M.D. Pa. Aug. 14,
2014) (“Plaintiffs will be prejudiced . . . by their current inability to proceed with their action
due to Defendants’ failure to defend.”). Second, Defendant has not asserted any meritorious
5

defenses to Plaintiff’s claims through the filing of an answer or other responsive pleading to the
complaint, or through the filing of a response to the instant motion. Consequently, the Court is
unable to conclude from Defendant’s silence that Defendant has a viable, litigable defense. See
Laborers Local Union 158 v. Fred Shaffer Concrete, No.10-1524, 2011 WL 1397107, at *2
(M.D. Pa. Apr. 13, 2011) (Kane, J.). Third, the Court cannot discern from the record any excuse
or justification for Defendant’s default apart from Defendant’s own culpability. Indeed, despite
signing the waiver of service of summons, which was received and docketed by this Court on
September 1, 2016, Defendant has failed to enter an appearance or file a timely answer to the
complaint and has offered no reasons for its failure to do so. “A defendant’s default, or its
decision not to defend against allegations in a complaint, may be grounds for concluding that the
defendant’s actions are willfull.” Innovative Office Prods., Inc. v. Amazon.com, Inc., No. 10–
4487, 2012 WL 1466512, at *3 (E.D. Pa. Apr. 26, 2012). In the absence of any excuse or
justification for Defendant’s failure to participate in this litigation, the Court must conclude that
the delay is the result of Defendant’s culpable conduct. See Laborers Local Union 158, 2011
WL 1397107, at *2. Accordingly, the Court is satisfied that the Chamberlain factors counsel in
favor of entering default judgment in favor of Plaintiff, and thus, will grant Plaintiff’s motion for
default judgment.
IV.

CONCLUSION
Based on the foregoing, the Court will grant Plaintiff’s motion for default judgment.

(Doc. No. 6.) An appropriate Order follows.

6