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Arch Specialty Insurance Co. v. Tried N True Interiors LLC

United States District Court, D. New Jersey

December 19, 2019

ARCH SPECIALTY INSURANCE COMPANY, Plaintiff,
v.
TRIED N TRUE INTERIORS LLC, Defendant.

          ORDER

          MADELINE COX ARLEO UNITED STATES DISTRICT JUDGE

         THIS MATTER comes before the Court by way of Plaintiff Arch Specialty Insurance Company's (“Plaintiff”) unopposed application for an entry of default judgment[1] pursuant to Federal Rule of Civil Procedure 55(b), ECF No. 10, against Defendant Tried N True Interiors LLC, (“Defendant”);

         and it appearing that this breach of contract action arises out of two general liability insurance policies issued by Plaintiff to Defendant, one covering the period from August 2016 to August 2017 (the “16-17 Policy”) and the other covering the period from August 2017 to August 2018 (the “17-18 Policy”), see Compl. ¶¶ 8-11, ECF No. 1;

         and it appearing that the premiums for the policies were based on estimated information that was subject to audit to reflect Defendant's actual exposure during the insurance policy period, and that an audit of the estimated information can result in a return of a portion of the premium to Defendant or more premium due to Plaintiff, id. ¶¶ 13-14;

         and it appearing that after an audit of Defendant's exposure for the 16-17 Policy, Defendant conceded it underpaid the premium for that policy by $101, 941 and executed a settlement agreement with Plaintiff that obligated Defendant to: (1) pay this sum in five monthly payments, the first in the amount of $23, 222.08, the remaining four in equal payments of $19, 679.73; and (2) fully comply with an audit of the 17-18 Policy and to pay any invoice under that policy within 30 days of receipt, id. ¶¶ 16-20; Settlement Agreement, Pellitteri Decl. Ex. D, ECF No. 9.6;

         and it appearing that Defendant made the first payment under the Settlement Agreement but refused to make any further payments and failed to fully cooperate with an audit as to the proper premium due under the 17-18 Policy, Compl. ¶¶ 19-20;

         and it appearing that an audit of the 17-18 Policy found Defendant to have underpaid the premium by $85, 858.23, and that despite demands for payment, Defendant has failed to pay the additional premium, id. ¶¶ 21-23;

         and it appearing that on January 7, 2019, Plaintiff filed this action against Defendant, asserting two claims for breach of contract under the Settlement Agreement, one for failing to pay the amount due under the 16-17 Policy (Count One), id. ¶¶ 24-37, and one for failing to pay the increased premium after an audit of the 17-18 Policy (Count Two), id. ¶¶ 38-51, and two claims for account stated, one under the 16-17 Policy (Count Three), id. ¶¶ 52-55, and one under the 17-18 Policy (Count Four), id. ¶¶ 56-61;

         and it appearing that Defendant has failed to answer the Complaint or otherwise respond as of the date of this Order;

         and it appearing that Plaintiff filed the present Motion for Default Judgment seeking a judgment of $164, 577.15, plus interest, costs of $450 and attorney's fees, Pl. Mem. at 10, ECF No. 9;

         and it appearing that default judgment may only be entered against a properly-served defendant, see E.A. Sween Co., Inc. v. Deli Express of Tenafly, LLC, 19 F.Supp.3d 560, 567 (D.N.J. 2014);

         and it appearing that the docket reflects service upon Defendant, ECF No. 5; and it appearing that a district court must determine whether it has jurisdiction over the action and the parties before entering a default judgment, see Animal Sci. Prods., Inc. v. China Nat'l Metals & Minerals Imp. & Exp. Corp., 596 F.Supp.2d 842, 848 (D.N.J. 2008);

         and it appearing that the Court has diversity jurisdiction over this matter because there is complete diversity of citizenship between Plaintiff and Defendant and the amount in controversy exceeds $75, 000, see Lincoln Benefit Life Co. v. AEI Life, LLC, 800 F.3d 99, 104 (3d Cir. 2015); Compl. ¶¶ 2-7;

         and it appearing that, pursuant to the Settlement Agreement, Defendant consented to the personal jurisdiction of “the state and federal courts in New Jersey, ...


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