Paniagua Grp., Inc. v. Hospitality Specialists, LLC

• Decision Date: 28 April 2016
• Docket Number: Civil No. 11-6003 (AMD)
• Citation: 183 F.Supp.3d 591
• Parties: Paniagua Group, Inc., Plaintiff, v. Hospitality Specialists, LLC, et al., Defendants.
• Court: U.S. District Court — District of New Jersey

183 F.Supp.3d 591

Paniagua Group, Inc., Plaintiff,

v.Hospitality Specialists, LLC, et al., Defendants.

Civil No. 11-6003 (AMD)

United States District Court, D. New Jersey, Camden Vicinage.

Signed April 28, 2016

Jonathan Thomas Guldin, Clark Guldin, Montclair, NJ, for Plaintiff.

Andre A. Norwood, Jr., Camden, NJ, for Defendants.

ORDER

ANN MARIE DONIO, UNITED STATES MAGISTRATE JUDGE

This matter comes before the Court by way of motion filed by Plaintiff Paniagua Group, Inc. (hereinafter, "Plaintiff"), seeking entry of default judgment against Defendants Florence Cirignano and Michael Cater.¹ (Second Motion for Default Judgment (hereinafter, "Pl.'s Mot.") [D.I. 101].) The Court has considered the submission, notes that no opposition has been filed, and that the time within which to file opposition has expired. The Court decides this matter pursuant to Federal Rule of Civil Procedure 78(b). For the reasons that follow, Plaintiff's motion [D.I. 101] is granted in part and denied without prejudice in part.

Because Defendants Florence Cirignano and Michael Cater have not responded in the present matter, all facts are taken from Plaintiff's amended complaint [D.I. 52], the affidavits submitted in support of this motion [D.I. 101-2, 101-5, and 101-6], the joint final pretrial order [D.I. 67], and the joint trial exhibits.²

The present litigation is a breach of contract action in which Plaintiff asserts breach of contract, promissory estoppel, and quantum meruit claims against Defendants Hospitality Specialists, LLC, Building Service and Hospitality Solutions, LLC, Building Services Solutions, LLC, Greg Cirignano, Florence Cirignano, and Michael Cater.³ (See generally Amended Complaint [D.I. 52].) Specifically, Plaintiff alleges that "[i]n early 2007" Plaintiff entered into "an oral subcontract with ‘Building Service Hospitality Specialist,’ "⁴ (hereinafter, "BSHS") under which Plaintiff agreed to "furnish[ ] labor and materials in connection with creation, construction, alteration, repair or improvement to two different properties[,] a Marriott Hotel in Albany, New York (hereinafter, "the Albany Project") and a Sheridan Hotel in Philadelphia, Pennsylvania (hereinafter, "the Philadelphia Project"). (Id. at ¶¶ 15, 16.) Plaintiff contends that the pricing under this subcontract was based on a "per unit price[.]" (Id. at ¶ 17.) Plaintiff further alleges that its obligations regarding the Albany Project were completed on or about April 20, 2007 and that Plaintiff was not paid the final price for the completed work-$115, 500.00. (Id. at ¶ 18.) Plaintiff also alleges that its obligations regarding the Philadelphia Project were completed on or about October 11, 2007 and the final price of the completed work was $815,193.75. (Id. at ¶ 19.) Plaintiff alleges that it was paid $500,937.90 of the amount owed for the Philadelphia Project leaving $314,255.85 unpaid. (Id. at ¶ 20.) In the complaint, Plaintiff seeks to recover the amount owed under the Philadelphia Project contract ($314,255.85), the amount owed under the Albany Project contract ($115,500.00), interest, court costs, and "such other relief as is just and proper under the circumstances." (Id. at ¶¶ 21-50.)

In the present motion, however, Plaintiff seeks $255,415.05 because, according to Plaintiff, of the amount owed to Plaintiff $174,340.80 was paid to Plaintiff's agent, Bart Corporation, and Plaintiff "is responsible for the actions of its agent." (Brief [D.I. 101-1], 6-7.)

On November 1, 2013, default was entered against both Defendants Florence Cirignano and Michael Cater for failing to respond to the amended complaint.⁵ (Clerk's Entry of Default, Nov. 1, 2013.) Prior to the commencement of any trial, Plaintiff and Defendants Greg Cirignano, Hospitality Specialists, LLC, Building Service and Hospitality Solutions, LLC, and Building Services Solutions, LLC entered into a settlement agreement and set forth the material terms of the agreement on the record.⁶ (See generally Transcript [D.I. 96], Nov. 19, 2014, 3:23-25; 4:1-5.) On November 19, 2014, counsel and the participating parties appeared before the Court for a non-jury trial. Defendants Florence Cirignano and Michael Cater neither appeared before the Court on November 19, 2014, nor otherwise participated in the litigation.

Thereafter, counsel for Plaintiff reduced the settlement to a written agreement. (See Affidavit of John N. Walker, Esq. (hereinafter, "Walker Affidavit") [D.I. 101-2], ¶ 14; see also Exhibit B to Walker Affidavit [D.I. 101-4] (setting forth the written settlement agreement).) The written settlement agreement provided for the same release of all claims by and between Plaintiff and Defendants Greg Cirignano, Florence Cirignano,⁷ Hospitality Specialists, LLC, Building Service and Hospitality Solutions, LLC, and Building Services Solutions, LLC, as was set forth on the record on November 19, 2014. (Id. at 1.) In addition, the written settlement agreement provided that Defendants Greg Cirignano and Florence Cirignano shall pay to Plaintiff $170,000.00 over a seven (7) year period in full satisfaction of all claims. (Id. at 1-2.)

Counsel for Plaintiff represents that on January 16, 2015, he was advised by counsel for Defendant Greg Cirignano that Defendant Greg Cirignano "was unwilling to sign the [s]ettlement [a]greement if his wife [Defendant Florence Cirignano] was also required to sign it." (Walker Affidavit [D.I. 101-2], ¶ 15.) On April 1, 2015, the Court granted Plaintiff's unopposed motion to reopen the proceedings in light of the fact that the parties had not consummated the settlement agreement within the required sixty (60) day period. (Order [D.I. 92], Apr. 1, 2015.) On May 1, 2015, Plaintiff filed a motion seeking a court order (1) enforcing the settlement agreement with respect to Defendants Greg Cirignano, Hospitality Specialists, LLC, Building Service and Hospitality Solutions, LLC, and Building Services Solutions, LLC, and (2) entering default judgment against Defendants Florence Cirignano and Michael Cater in the amount of $225,415.05. (First Motion for Enforcement of Settlement Agreement and Entry of Default Judgment [D.I. 97].) The Court granted Plaintiff's motion to enforce the settlement agreement in part, finding "the release and settlement amount terms are enforceable" (Order [D.I. 98], Sept. 4, 2015, 10), and "enforc[ing] the payment terms as they are set forth in the written copy of the settlement agreement with the exception of the first settlement payment due date."⁸ (Id. at 12.) The Court did not "enforce any remaining terms of the written copy of the settlement agreement."⁹ (Id. at 13.)

The Court also denied without prejudice Plaintiff's motion to the extent it requested default judgment be entered against Defendants Florence Cirignano and Michael Cater because Plaintiff did "not provide any specific and/or sufficiently detailed information or case law to support Plaintiff's claim as to the liability of" those Defendants. (Id. at 18.) Specifically, in response to Plaintiff's assertions that "Defendants Florence Cirignano and Michael Cater are ‘joint venturers' in the unincorporated Building Service Hospitality Specialist, and that Florence Cirignano and Michael Cater utilized [BSHS's] checking account for their own personal benefit" (id. at 17-18), the Court found that Plaintiff did not address the "legal basis upon which the Court may hold [Defendants Florence Cirignano and Michael Cater] responsible for acts of the unincorporated entity[,]" BSHS. (Id. at 17.) The Court reasoned "it is unclear whether Plaintiff is attempting to pierce the corporate veil of the corporate defendants or asks the Court to find Defendants Florence Cirignano and Michael Cater liable under an alter ego theory of liability." (Id.) Thereafter, on October 14, 2015, the Court ordered that any motions for default judgment be filed no later than November 6, 2015 (Text Order [D.I. 100], Oct. 14, 2015), and Plaintiff timely filed this motion. (See Pl.'s Mot. [D.I. 101].)

In the present motion, Plaintiff argues that it is entitled to entry of default judgment against Defendants Florence Cirignano and Michael Cater because they failed to plead or otherwise respond to the amended complaint and they are jointly and severally liable to Plaintiff for the debts owed to Plaintiff by the unincorporated entity Building Service Hospitality Specialist. (See generally Brief [D.I. 101-1].) Plaintiff presents two theories of vicarious liability in support of its motion. Plaintiff argues that "Building Service Hospitality Specialist is an unincorporated association, making its members individually liable for its debts" (see Brief [D.I. 101-1], 8), and that Defendants "Florence Cirignano and Michael Cater are coventurers who are jointly and severally liable to Paniagua for BSHS's debts." (Id. at 11.) For the reasons set forth, the Court finds that Plaintiff is entitled to an entry of default judgment as to liability.

"In order to impose personal liability upon a defendant or obligate him or her in favor of a plaintiff, a court must be vested with jurisdiction over the parties as well as subject matter jurisdiction." Ayr e s v. Jacobs & Crumplar, P.A., 99 F.3d 565, 569 (3d Cir.1996). The Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332 because complete diversity exists and the amount in controversy exceeds $75,000. Plaintiff is an Illinois corporation with its principal place of business in Grove Village, Illinois (Amended Complaint [D.I. 52], ¶ 1), Defendants "are all domiciled in New Jersey," (id. at ¶ 13), and Plaintiff seeks $429,755.85 from Defendants. (Id.) This Court has personal jurisdiction over Defendants Florence Cirignano and Michael Cater because Defendants are domiciled in New Jersey. (Id. at ¶ 12.)

Plaintiff applies New Jersey substantive law in support of its motion for default judgment. (See generally Brief [D.I. 101].) Plaintiff has not addressed choice of law and whether New Jersey law applies...