Liberty Mutual Personal Insurance Company v. McCaskill

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION LIBERTY MUTUAL PERSONAL INSURANCE ) COMPANY, ) ) Plaintiff, ) ) CIVIL ACTION NO. 23-00455-JB-N v. ) ) STEPHANY S. MCCASKILL, ) ) Defendant. ) ORDER This ac)on is before the Court on Plain)ff, Liberty Mutual Personal Insurance Company’s (“Liberty”) Mo)on for Default Judgment (Doc. 12). For the reasons set forth below, Plain)ff’s mo)on is GRANTED. I. Factual and Procedural Background This ac)on arises out of automobile insurance policy issued by Liberty to Defendant covering a 2020 Jeep Grand Cherokee with a reported Alabama license plate A10242 (the “Jeep”). (Doc. 1). On January 3, 2023, Defendant filed an insurance claim under the automobile policy for vehicle theS of the Jeep with a reported vehicle iden)fica)on number (“VIN”) of 1C4RJFN94LC206715. (Id.) In response to the insurance claim, Liberty ran a market valua)on report for the insured vehicle which calculated its value at $93,065.00. Based on Defendant’s representa)ons, Liberty issued a payment totaling $93,065.00 to Defendant on January 24, 2023. (Id.). On April 10, 2023, following the conclusion of the claim, Liberty received a call from a representa)ve of the Na)onal Insurance Crime Bureau (“NICB”) who indicated that the VIN provided by Defendant was counterfeit as there was no record of the VIN ever shipping. This informa)on was later confirmed by Jeep who advised that no such VIN existed. (Id.). ASer no)fica)on of the false VIN, Liberty conducted an inves)ga)on into the Jeep’s history in order to determine the origin of the fraudulent VIN. (Id.). During the inves)ga)on, Liberty obtained a handwri^en Bill of Sale for the Jeep which documented that it was sold for $1,000 on October 7, 2022. (Id.). Liberty also obtained a copy of the Jeep’s Alabama registra)on which was created by using a counterfeit Cer)ficate of Title supposedly issued by the State of Mississippi. (Id.). On July 24, 2023, Liberty, through counsel, sent Defendant a le^er no)fying her that an inves)ga)on showed that the provided informa)on rela)ng to her insurance claim was false and demanding that the $93,065.00 payment be returned to Liberty. (Id.) Defendant did not return the $93,065.00 to Liberty. (Id.) On December 4, 2023, Liberty filed its Complaint against Defendant asser)ng fraudulent misrepresenta)on, breach of contract, unjust enrichment, fraud, and conversion seeking compensatory damages, including, but not limited to, reimbursement of the $93,065.00 in insurance benefits paid to Defendant, a^orney’s fees and costs. (Id.). Defendant was served with Summons and the Complaint on December 14, 2023. (Doc. 8). Defendant did not answer or otherwise defend this lawsuit. (See Docket, generally). On January 26, 2024, Liberty filed an Applica)on for Entry of Default which was granted by the Clerk of Court on February 2, 2024. (Docs. 10 and 11). The instant Mo)on for Default Judgment is now before this Court. II. Standard of Review In this Circuit, “there is a strong policy of determining cases on their merits and we therefore view defaults with disfavor.” In re Worldwide Web Systems, Inc., 328 F.3d 1291, 1295 (11th Cir. 2003). Nonetheless, it is well established that a “district court has the authority to enter default judgment for failure … to comply with its orders or rules of procedure.” Wahl v. McIver, 773 F.2d 1169, 1174 (11th Cir. 1985). Rule 55 provides for entry of default and default judgment where a defendant “has failed to plead or otherwise defend.” Rule 55(a), Fed.R.Civ.P. “In a variety of contexts, courts have entered default judgments against defendants who have failed to appear and defend in a )mely manner following proper service of process. In short, ‘[w]hile modern courts do not favor default judgments, they are certainly appropriate when the adversary process has been halted because of an essen)ally unresponsive party.’” Iberiabank v. Case Const., LLC, 2015 WL 4624732 *2 (S.D. Ala. August 3, 2015) (finding default judgment appropriate for failure to appear or defend for two and half months aSer service) (ci)ng to Flynn v. Angelucci Bros. & Sons, Inc., 448 F. Supp.2d 193, 195 (D.D.C. 2006) (internal and external cita)ons omi^ed). III. Discussion Although Defendant was served with process on December 14, 2023, she has not appeared or defended this ac)on and the )me to do so has expired. As a result, entry of default judgment is appropriate. However, “‘a default is not treated as an absolute confession by the defendant of his liability and of the plain)ff’s right to recover.’ Rather, it is only an admission of the facts cited in the Complaint, which by themselves may or may not be sufficient to establish a defendant’s liability.” PiCs ex rel. PiCs v. Seneca Sports, Inc., 321 F. Supp.2d 1353, 1357 (S.D. Ga. 2004) (quo)ng Nishimatsu Const. Co. v. Houston Nat’l Bank, 515 F.2d 1200, 1204 (5th Cir. 1975) (cita)on omi^ed). As a result, this Court must examine the whether the factual allega)ons of the Complaint create a sufficient basis for the judgment which Liberty seeks. See Bruce v. Wal–Mart Stores, Inc., 699 F.Supp. 905, 906 (N.D. Ga.1988) (“In considering a mo)on for entry of default judgment, a court must inves)gate the legal sufficiency of the allega)ons of the plain)ff's complaint.”) (cita)on omi^ed). The Court has reviewed the instant Complaint and is sa)sfied that it provides sufficient factual allega)ons, which are deemed admi^ed as true, to support a Breach of Contract claim. “The elements of a breach-of-contract claim under Alabama law are (1) a valid contract binding the par)es; (2) the plain)ffs' performance under the contract; (3) the defendant's nonperformance; and (4) resul)ng damages.” Shaffer v. Regions Fin. Corp., 29 So. 3d 872, 880 (Ala. 2009) (cita)on omi^ed). Namely, Liberty alleges a contract existed in the form of a policy, that Defendant submi^ed a false claim in breach of the policy, and that Liberty was damaged in the amount of $93,024.00 that it paid but did not owe under the policy. Because the well- pleaded factual allega)ons in the Complaint are deemed admi^ed by virtue of Defendant’s default, and because they are sufficient to state an ac)onable claim under Alabama law, the entry of a default judgment against Defendant is warranted pursuant to Rule 55. As a result, the Court finds that Defendant is liable to Liberty on Count One for Breach of Contract.1 1 Because the remaining claims asserted by Plain4ff for Fraudulent Misrepresenta4on (Count I), Unjust Enrichment (Count III), Fraud (Count IV), and Conversion (Count V) under Alabama law are based on the same underlying facts and seek the same damages award as the breach of contract claim, they are duplica4ve of Plain4ff’s breach of contract claim and the Court will not separately address the sufficiency of each claim. Nevertheless, it is worth no4ng that while Plain4ff may plead alterna4ve theories of recovery, when the existence of a contract is proven, there can be no unjust enrichment claim. See Wireman v. Park Na/onal Corp., 2020 WL 5845716 , *8 (S.D. Ala. September 30, 2020) (“[T]he existence of an express contract extinguishe[s] an unjust enrichment claim altogether because Although Plain)ff may be en)tled to a default Judgment, Liberty must s)ll prove its damages. “While well-pleaded facts in the complaint are deemed admi^ed, plain)ffs’ allega)ons rela)ng to the amount of damages are not admi^ed by virtue of default; rather, the court must determine both the amount and character of damages.” Virgin Records America, Inc. v. Lacey, 510 F. Supp.2d 588 , 593 n.5 (S.D. Ala. 2007). “Even in the default judgment context, ‘[a] court has an obliga)on to assure that there is a legi)mate basis for any damage award it enters.’” Iberiabank, at *3 (quo)ng Anheuser Busch, Inc. v. Philpot, 317 F.3d 1264, 1266 (11th Cir. 2003). “Rather than merely telling the Court in summary fashion what its damages are, a plain)ff seeking default judgment must show the Court what those damages are, how they are calculated, and where they come from.” Id. quo)ng PNCEF, LLC v. Hendricks Bldg. Supply LLC, 740 F. Supp.2d 1287, 1294 (S.D. Ala. 2010). In this ac)on, Liberty has clearly asserted that it paid Defendant $93,065.00, and seeks that amount in damages. The relevant documents before this Court establish that Liberty issued a check to Defendant in the amount of $93,065.00 (Doc. 12-1 at 72), the value of the insured vehicle per the market valua)on report, as a result of Defendant’s claim of loss. Defendant did not return the issued amount to Plain)ff, in whole or part. As a result, a damages award against Defendant in the amount of $93,065.00 is appropriate. unjust enrichment is an equitable remedy which issues only where there is no adequate remedy at law.”) (quoting Univalor Trust, SA v. Columbia Petroleum, LLC, 315 F.R.D. 374, 382 (S.D. Ala. 2016)). IV. Conclusion For all of the foregoing reasons, Plain)ff’s Mo)on for Default Judgment (Doc. 12) is GRANTED. Default judgment will be entered in favor of Liberty and against Defendant in the amount of $93,065.00. DONE and ORDERED this 16th day of May, 2024. /s/ JEFFREY U. BEAVERSTOCK CHIEF UNITED STATES DISTRICT JUDGE