Yeager v. Brand
| Decision Date | 28 September 2018 |
| Docket Number | NO. 4:17-CV-168-DMB-JMV,4:17-CV-168-DMB-JMV |
| Parties | SUSAN L. YEAGER, et al. PLAINTIFFS v. R.L. BRAND, et al. DEFENDANTS |
| Court | U.S. District Court — Northern District of Mississippi |
Before the Court for determination is the issue of damages to be awarded the plaintiffs following the Court's entry of default judgment against the defendants.
On December 1, 2017, Susan L. Yeager and Amelia A. Nichols, acting as guardians of their mother Jacoba Louise Dooley, filed a complaint in this Court against R.L. Brand; Roderick Mitchell; B & B Contracting Management Services, Inc. ("B&B"); and New Life Church of Cleveland, Mississippi ("New Life"). Doc. #1. The complaint alleges that during the time relevant to this action, Dooley's mind was beginning to fail and:
The individual defendants, R.L. Brand and Roderick Mitchell, scammed and fleeced the ward into buying a lot from New Life Church which lot was not owned by New Life Church, but rather was owned by Roderick Mitchell and his wife and which lot was mortgaged and could not be conveyed free and clear and by having plaintiff enter into a construction contract with Brand [and B&B] for him, Brand, to construct a house on said lot for $140,000.00 and toward which $140,000.00 plaintiff paid Brand $70,000.00 or $105,000.00 (as may be proved) for which house Brand had no intention of completing and for which Brand never did any work except to hip up the soil for the foundation. Thus Roderick Mitchell and R. L. Brand conspired together to deprive and defraud the ward of that to which she was lawfully entitled, a lot with a deed and a house erected thereon in order to steal from ward the money she paid for the lot, title to which she never got, and the money the ward paid to have the house constructed, which construction was never done. Brand and Mitchell took advantage of the ward's senility and dementia in so scamming and fleecing said ward.
Id. at ¶ 50. As relief, the plaintiffs seek (1) rescission of the purchase contract with New Life and Mitchell; (2) rescission of the construction contract with Brand and B&B (3) damages in the form of return of the purchase price and monies paid under the construction contract, plus interest; (4) attorney's fees; (5) treble damages assessed against Mitchell and New Life under Mississippi's Vulnerable Persons' Act; and (6) any other relief to which they may be entitled. Id. at 16-17.
Mitchell and New Life were served with a summons and copy of the complaint on December 2, 2017. Doc. #5 at 2; Doc. #6 at 2. Brand and B&B were served on December 5, 2017. Doc. #3 at 2; Doc. #4 at 2. Mitchell and New Life filed separate answers to the complaint on December 20, 2017. Doc. #7; Doc. #8. Neither Brand nor B&B answered the complaint and, on December 28, 2017, the plaintiffs moved for entry of default. Doc. #11.
The Clerk of the Court entered default against Brand and B&B on January 2, 2018. Doc. #12. The plaintiffs moved for default judgment the following day. Doc. #15. That same day, the Clerk received from Brand a letter styled, "Answer to judgement." Doc. #16. Brand's letter contradicts most of the facts alleged in the complaint but offers no excuse for the default and does not request that the default be set aside.
On February 12, 2018, the plaintiffs filed a "Stipulation of Dismissal as to Two Defendants Only." Doc. #28. The stipulation, which is signed by Brand (on his own behalf and purportedly on behalf of B&B),1 the plaintiffs' counsel, Mitchell, and New Life, stipulates to the dismissal with prejudice of Mitchell and New Life. Id. at 2. Over the next week, the plaintiffs, in support of their motion for default judgment, filed two affidavits, a memorandum brief, and a letter from a medical doctor opining on Dooley's mental condition. Docs. #31, #32, #34, #35.
On April 12, 2018, this Court entered an order granting default judgment against thedefendants on the issue of liability and setting an evidentiary hearing on the issue of damages for April 30, 2018. Doc. #39 at 9. Four days later, the Court, at the plaintiffs' request, issued an order canceling the evidentiary hearing in favor of allowing the plaintiffs to submit documentary evidence and arguments on the issue of damages. Doc. #40. The order also provided that Id.
In compliance with this Court's order, between April 23-30, 2018, the plaintiffs filed various documents and a brief on the issue of damages. Docs. #42, #43, #44, #45, #46, #47. After the defaulting defendants failed to respond to these filings, the plaintiffs, on May 18, 2018, filed a motion asking the Court to decide the issue of damages on the existing submissions. Doc. #49.
On May 24, 2018, Brand filed a pro se "Answer" which summarizes various pieces of evidence and expected testimony, and explains why the evidence would disprove certain allegations in the complaint. Doc. #50. One week later, on May 31, 2018, the plaintiffs filed a "response" to the "answer." Doc. #51.
On June 25, 2018, Brand filed "Defendant's motion to deny motion Quantum of damages." Doc. #52. Three days later, Brand filed a motion requesting an unspecified hearing. Doc. #53. The plaintiffs responded in opposition to both motions. Doc. #54; Doc. #55.
As explained above, approximately four months after default and one month after this Court's granted the plaintiffs' motion for default judgment, Brand filed a document titled, "Answer." However, an untimely answer does not count as a pleading under the Federal Rules so as to defeat a default judgment. In re Suprema Specialties, Inc., 330 B.R. 40, 46 (S.D.N.Y. 2005).This is especially true where, as here, there has been no motion to set aside entry of default and no showing of good cause. See Fed. R. Civ. P. 55(c) (). Accordingly, Brand's untimely answer does not alter the plaintiffs' entitlement to default judgment.
Following a default judgment, "[a] plaintiff bears the burden of proving his damages." Niemi v. Lasshofer, 770 F.3d 1331, 1355 (10th Cir. 2014); see Flynn v. People's Choice Home Loans, Inc., 440 F. App'x 452, 457 (6th Cir. 2011) (). Generally, a district court may only award damages without an evidentiary hearing if "the amount claimed is a liquidated sum or one capable of mathematical calculation."2 James v. Frame, 6 F.3d 307, 310 (5th Cir. 1993).
Regarding damages, "[a] default judgment must not differ in kind from, or exceed in amount, what is demanded in the pleadings." Fed. R. Civ. P. 54(c). Therefore, "the relief prayed for in a complaint defines the scope of relief available on default judgment." United States v. Giles, 538 F.Supp.2d 990, 994 (W.D. Tex. 2008); see Silge v. Merz, 510 F.3d 157, 160 (2d Cir. 2007) (). If the requested relief does not differ in kind from, or exceed in amount, what is demanded in the pleadings, the Court must then determine "if the requested relief is appropriate based on governing law." Fagan v. Lawrence Nathan Assocs., Inc., 957 F.Supp.2d 784, 801 (E.D. La. 2013).
In their brief, the plaintiffs seek (1) $70,000 in actual damages, representing the amount paid to Brand by Dooley; (2) $11,649.44 in pre-judgment interest; and (3) $23,600.71 in attorney's fees and expenses. The plaintiffs also seek treble damages.
There is no dispute that where, as here, a plaintiff has been induced to purchase property through fraud or misrepresentation, the plaintiff is entitled to rescission of the construction contract and return of the contract price.3 See Browder v. Williams, 765 So.2d 1281, 1285 (Miss. 2000) (). There is also no dispute that Dooley paid the defaulting defendants $70,000 towards the construction contract price. In his "Answer" and motion to deny damages, Brand argues that the proper recovery is actually $60,000 because Brand performed $10,000 worth of improvements on the property and because the plaintiffs, during a state board hearing, said they would accept $60,000 in damages. Doc. #52 at 1; Doc. #50-1.
As an initial matter, pursuant to Federal Rule of Evidence 408, the plaintiffs' offer to settle for a certain sum may not be used "to prove or disprove the validity or amount of a disputed claim ...." Furthermore, while it is possible that Brand, under a theory of unjust enrichment, may be entitled to recover his expenses from the actual owner of the property, such recovery is wholly inappropriate against Dooley, who received no benefit from Brand's work. See Hans v. Hans, 482 So.2d 1117, 1122 (Miss. 1986) (). Accordingly, the plaintiffs are entitled to reimbursement of the $70,000 paid for the property.
"State law governs the award of prejudgment interest in diversity cases." Meaux Surface Protection, Inc. v. Fogleman, 607 F.3d 161, 172 (5th Cir. 2010). Under Mississippi law, "[a]n award of prejudgment interest is within the trial court's discretion." In re Miss. Medicaid Pharm. Average Wholesale Price Litig., 190 So.3d 829, 843 (Miss. 2015). A trial court acts within its discretion when it allows pre-judgment interest "in cases where the amount due is liquidated when the claim is originally made or where the denial...
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