UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY
September 28, 2007
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, PLAINTIFF,
BRANDON S. BARE, CARLOS E. BARE, TAMMY A. NICHOLS, THE ESTATE OF TAMMY A. NICHOLS, WILLIAM NEVERETTE, AND IRENE NEVERETTE, DEFENDANTS.
The opinion of the court was delivered by: Greenaway, Jr., U.S.D.J.
This matter comes before this Court on the motion of Plaintiff, The Prudential Insurance Company of America ("Plaintiff"), for entry of a default judgment against Defendants Brandon S. Bare, Carlos E. Bare, and the Estate of Tammy A. Nichols (collectively the "Non-responsive Defendants"), pursuant to FED. R. CIV. P. 55(b)(2). Defendants William Neverette and Irene Neverette have filed an answer. Plaintiff filed this interpleader action seeking to determine the rights of rival claimants to a life insurance policy owned by Nabila Bare. This Court grants Plaintiff's motion.
I. Legal Standard
Rule 55(b)(2) states:
In all other cases the party entitled to a judgment by default shall apply to the court therefor; but no judgment by default shall be entered against an infant or incompetent person unless represented in the action by a general guardian, committee, conservator, or other such representative who has appeared therein. . . . If, in order to enable the court to enter judgment or to carry it into effect, it is necessary to take an account or to determine the amount of damages or to establish the truth of any averment by evidence or to make an investigation of any other matter, the court may conduct such hearings or order such references as it deems necessary and proper and shall accord a right of trial by jury to the parties when and as required by any statute of the United States.
"The Federal Rules of Civil Procedure commit the entry of a default judgment against a party to the sound discretion of the trial court." F.T.C. v. Packers Brand Meats, Inc., 562 F.2d 9, 11 (8th Cir. 1977).
"Default establishes the defaulting party's liability for the well-pleaded allegations of the complaint." U.S. v. Gant, 268 F. Supp. 2d 29, 32 (D.D.C. 2003) (citing Brock v. Unique Racquetball & Health Clubs, Inc., 786 F.2d 61, 65 (2d Cir. 1986)). Default does not establish liability for the amount of damages claimed by the plaintiff. Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974) ("While a default judgment constitutes an admission of liability, the quantum of damages remains to be established by proof unless the amount is liquidated or susceptible of mathematical computation."). "The district court must instead conduct an inquiry in order to ascertain the amount of damages with reasonable certainty." Credit Lyonnais Secs. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999).
The district court has considerable latitude in determining the amount of damages. Jones v. Winnepesaukee Realty, 990 F.2d 1, 4 (1st Cir. 1993). In determining the amount, the district court may conduct a hearing. FED. R. CIV. P. 55(b)(2). The court is not required to do so, however, "as long as it ensure[s] that there [is] a basis for the damages specified in the default judgment." Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., Div. of Ace Young Inc., 109 F.3d 105, 111 (2d Cir. 1997). "It is familiar practice and an exercise of judicial power for a court upon default, by taking evidence when necessary or by computation from facts of record, to fix the amount which the plaintiff is lawfully entitled to recover and to give judgment accordingly." Pope v. U.S., 323 U.S. 1, 65 (1944).
Before the entry of default judgment against a party that has not filed responsive pleadings, "the district court has an affirmative duty to look into its jurisdiction both over the subject matter and the parties." Williams v. Life Sav. & Loan, 802 F.2d 1200, 1203 (10th Cir. 1986).
This Court has subject matter jurisdiction of this interpleader action, under 28 U.S.C. § 1335, because there is diversity of citizenship, pursuant to 28 U.S.C. § 1332, and because Prudential has in its custody proceeds on a life insurance policy in the amount of $500.00 or more.
This Court has personal jurisdiction over the Non-responsive Defendants, because 28 U.S.C. § 2361 provides for nationwide service of process in actions brought pursuant to 28 U.S.C. § 1335. See 28 U.S.C. § 2361*fn1 ; see NYLife Distrib., Inc. v. Adherence Group, Inc., 72 F.3d 371, 375 (3d Cir. 1995).
The Non-responsive Defendants have failed to appear, or otherwise plead, in response to the Complaint, which was filed on August 31, 2006, and served on the Estate of Tammy A. Nichols on October 18, 2006, on Carlos E. Bare on October 20, 2006, and on Brandon S. Bare on December 13, 2006. Also, the Non-responsive Defendants have failed to respond to the instant motion, filed on March 2, 2007. Ten months have passed since the filing of the Complaint, and four months have passed since the clerk's entry of default. Plaintiff submitted, on September 20, 2007, an affidavit certifying that the Non-responsive Defendants are neither incompetent, nor infants. (Aff. of Seth Ptasiewicz at 2.) This Court, therefore, finds that default judgment is appropriate, under FED. R. CIV. P. 55(b)(2).
As this is an interpleader action, Defendants have not requested a specific amount of money. Therefore, the effect of this order is to forfeit the rights of the Non-responsive Defendants to the proceeds of the insurance policy of Nabila Bare. For the reasons set forth above, and good cause appearing,
IT IS on this 28th day of September, 2007
ORDERED that Plaintiff's motion for entry of a default judgment (Docket Entry No. 20) is GRANTED; and it is further
ORDERED that a final judgment by default is hereby entered as to Defendants Carlos E. Bare, Brandon S. Bare, and the Estate of Tammy A. Nichols; and it is further
ORDERED that a copy of this Order be served on all parties within seven (7) days of the date of this Order.
JOSEPH A. GREENAWAY, JR., U.S.D.J.