Metro. Life Ins. Co. v. Sutherlin
| Decision Date | 04 January 2022 |
| Docket Number | 1:21-cv-11609 |
| Parties | METROPOLITAN LIFE INSURANCE COMPANY, Plaintiff, v. DAVID SUTHERLIN, MELVINER BAILEY and ROMONA RANKIN, Defendants. |
| Court | U.S. District Court — Eastern District of Michigan |
REPORT AND RECOMMENDATION ON PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT, LEAVE TO DEPOSIT INTERPLEADER FUNDS AND FOR DISMISSAL WITH PREJUDICE (ECF No. 16)
For following reasons, I RECOMMEND that Plaintiff's motion (ECF No. 16) be GRANTED IN PART as to Plaintiff's request for leave to deposit funds, and for dismissal with prejudice but DENIED as to the request for default judgment against Bailey and Rankin. (ECF No. 16).
The decedent, Frizzell Sutherlin, participated in a life insurance program through his employer, General Motors.[1] (Id.) When Frizzell died in February 2020, he had named his former caretaker, Melviner Bailey, as his sole beneficiary. (Id.; ECF No. 1-3, PageID.55; ECF No. 1-10, PageID.74.) After the proceeds from Frizzell's plan were used to pay for his funeral expenses, Bailey claimed the remaining funds, totaling $3, 243.96. (ECF No. 1, PageID.5-6.) However, Frizzell's last surviving son, David Sutherlin, contested Bailey's claim, arguing that Frizzell had begun to suffer from dementia at the time he named Bailey as his beneficiary. (Id.) If Frizzell did not validly name Bailey as his beneficiary, then Frizzell's surviving children would be entitled to the proceeds from his life insurance policy. (ECF No. 1-18, PageID.111.) David later sent Plaintiff copies of Frizzell's medical records which confirmed that Frizzell had suffered from dementia when he named Bailey as his beneficiary. (ECF No. 1, PageID.5-6; ECF No. 1-3, PageID.55; ECF No. 1-13, PageID.84, 86.)
The medical records also revealed that Frizzell had an unnamed daughter. (ECF No. 1-13, PageID.87.) Plaintiff alleges that this statement in Frizzell's medical records is corroborated by his obituary which lists a woman named Romona Rankin as a “possible child . . . .” (ECF No. 1, PageID.7.) However, David Sutherland completed an affidavit stating that Frizzell had only two sons, one of whom was deceased. (ECF No. 1-14, PageID.90.) Further, Bailey supplied Plaintiff with a copy of Frizzell's will, which expressly stated that “Romona” was “not [his] child.” (ECF No. 1-17, PageID.105.)
On December 22, 2020, Plaintiff wrote letters to Bailey and David, requesting that they resolve the dispute between themselves to avoid litigation. (ECF No. 1-18, PageID.111.) Bailey and David failed to come to an agreement, and Plaintiff filed an interpleader action in this Court on July 12, 2021. (See id.; ECF No. 1.) No. party answered Plaintiff's complaint and Plaintiff requested an entry of default against Rankin and Bailey, and the Clerk subsequently entered their default. (See ECF Nos. 14-15.)
Plaintiff did not, however, request an entry of default against David Sutherlin. (ECF No. 16, PageID.136.) In October 2021, David's sister-in-law contacted Plaintiff's counsel and informed her that she had been appointed by David to handle the matter on his behalf. (Id.) However, David's sister-in-law is not an attorney and David Sutherlin is currently not represented by counsel. (Id. at PageID.136-37.)
A week after the Clerk of the Court entered Bailey and Rankin's default, Plaintiff moved for this Court to enter a default judgment against both parties. (ECF No. 16.) Plaintiff also moved for leave to deposit the life insurance proceeds with the Court, to be dismissed from the action with prejudice, and for Defendants to be enjoined from bringing any further action against Plaintiff related to Frizzell's life insurance plan.[2] (ECF No. 16.) No. party has responded Plaintiff's motion and the deadline to respond has passed.
A default judgment is “[a] judgment entered against a defendant who has failed to plead or otherwise defend against the plaintiff's claim . . . .” Default Judgment, Black's Law Dictionary (11th ed. 2019). Rule 55 of the Federal Rules of Civil Procedure provides a two-step process for the court to enter a default judgment. First, “[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). Once the clerk enters a party's default, any other party may “apply to the court for a default judgment.”[3] Fed.R.Civ.P. 55(b)(2); see Aetna Life Ins. Co. v. Gablow, No. 09-14049, 2010 WL 4024719, at *2 (E.D. Mich. Oct. 13, 2020). The court may only enter a default judgment “against a minor or an incompetent person” if he or she is “represented by a . . . fiduciary who has appeared” before the court. Fed.R.Civ.P. 55(b)(2). Additionally, under the Servicemembers Civil Relief Act (“SCRA”), the court may not enter a default judgment against an active military service member. Merrill v. Beard, No. 5:05CV768, 2007 WL 461469, at *3 (N.D. Ohio, Feb. 7, 2007); 50 U.S.C. §§ 3902, 3931 (2012).
The moving party has an affirmative duty to prove to the court that the party against whom they wish to enter a default judgment is a competent adult. Mason Dixon Lines, Inc. v. Shamrock Management Group, LLC, No. 1:13-cv-403, 2015 WL 13186242, at *4 (E.D. Tenn. Jan. 12, 2015) (citing Ross v. Baker, No. 4:06-cv-111, 2006 U.S. Dist LEXIS 77216 at *4 (W.D. Mich. Oct. 23, 2006)).
For example, in Capitol Records, Inc. v. Garcia, the District of Minnesota held that it could not enter a default judgment against a defendant where the moving party summarily asserted, in an affidavit, that it believed the defendant was “not an infant or an incompetent person.” No. 07-CV-1414, 2007 WL 9734958, at *2 (D. Minn. Nov. 7, 2007). Recognizing that default judgments “are not favored by law, ” the court reasoned that because the “affidavit provide[d] almost no information about” the defendant, the court could not “satisfy[] itself that the defendant [was] a competent adult.” Id. (internal quotation marks omitted) (quoting Trustees of the St. Paul Elec. Constr. Indus. Fringe Benefit Funds v. Martens Elec. Co., 485 F.Supp.2d 1063, 1064 (D. Minn. 2007)). Indeed, making such a finding based on a moving party's mere assertion would conflict with the great “pain[s]” Rule 55 takes to “protect” minors and incompetent individuals. Id.
Similarly, the SCRA requires a plaintiff in any civil action to file an affidavit “stating whether . . . the defendant is in military service. 50 U.S.C. §§ 3902(a)-(b), 3931(b)(1)(A); In re Templehoff, 339 B.R. 49, 53 (S.D.N.Y. 2005) (); see also Zee Company, Inc. v. Davis, No. 1:20-cv-00143, 2021 WL 5177778, at *1 (E.D. Tenn. Aug. 27, 2021). The affidavit must contain all facts that are “necessary” to support it. 50 U.S.C. § 3931(b)(1)(A). If, however, the plaintiff cannot determine that the defendant is in military service, then the plaintiff must file an affidavit stating this fact. Id. § 3931(b)(1)(B). If the court cannot determine the defendant's military status based on the affidavit, then it may require the plaintiff to file a bond that will “be available to indemnify the defendant against any loss . . . .” Id. § 3931(b)(3).
Here, Plaintiff provides no information regarding Rankin's age, competency, or military status. Similarly, although Plaintiff provides a claim form completed by Bailey, stating that she was born in 1939, Plaintiff provides no information about her competency.[4](ECF No. 1-12, PageID.80.)
First, at least with respect to Rankin, Plaintiff was required by the SCRA to provide the court with an affidavit regarding her military status, but Plaintiff failed to do this. See 50 U.S.C. § 3931(b)(1). Accordingly, I suggest that this Court should not enter a default judgment against Rankin. Cf. U.S. v. Simmons, 508 F.Supp. 552, 552 (E.D. Tenn. 1980)
Second, the court may not infer that these two defendants are competent adults simply because the record contains no evidence suggesting that these elements may be at issue. At least where a party moves for default judgment, the absence of evidence is not evidence of absence. By inferring that both Defendants are competent adults because the record contains no evidence stating otherwise, the Court would effectively place the burden of proof on the defaulting parties.
Surely, however, Rule 55 was not intended to require the party in default to prove that he or she belongs to a classification that is protected from default judgment. Because “[d]efault judgments are disfavored, ” the “legal prerequisites” to enter a default judgment require “strict compliance.” Walton v. Rogers, No. 88-3307, 1988 WL 109859, at *1 (6th Cir. Oct. 19, 1988) (citing Varnes v. Local 91, Glass Bottle Blowers Ass'n of the U.S. and Can., 674 F.2d 1365, 1369 (11th Cir. 1982)); see also 10A Charles A. Wright et al., Federal Practice and Procedure § 2681 (4th ed. 2021). Recognizing the harsh nature of default judgments, Rule 55 was structured to protect vulnerable individuals. See Capitol Records, Inc., 2007 WL 9734958, at *2. Yet, if this Court were to enter a default judgment because Plaintiff chose not to provide the court with any evidence that that either defendant was incompetent or a minor, the Court would circumvent these protections.
Indeed because the moving party has no incentive to provide the court with information that would counsel against an entry of default judgment, it would make little sense to assume that a defendant is a competent adult merely because the Plaintiff...
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