HILLMAN, District Judge.
This is a breach of contract action concerning Plaintiff's transport of cargo for the benefit of Defendants from 2012-2015. Presently before this Court is Plaintiff's Amended Motion for Default Judgment against Defendants TJM International Limited Liability Company ("TJM International") and Marsh and Associates Signing Services, LLC ("Marsh and Associates," and collectively with TJM International, "Entity Defendants"). Entity Defendants have not opposed this motion. For the reasons stated herein, Plaintiff's Amended Motion for Default Judgment will be granted.
This Court takes its facts from Plaintiff's Complaint. According to the complaint, Plaintiff is a common carrier by water in interstate and foreign commerce as defined by the Shipping Act, and was such a common carrier when it performed services for Defendants. Entity Defendants are limited liability companies formed in and citizens of New Jersey.
Plaintiff alleges it fully performed transportation services for Defendants pursuant to written contracts of carriage between Plaintiff and Defendants, except those obligations, if any, which Plaintiff was excused from performing. Plaintiff demanded Defendants pay the amount due under the contracts, but Defendants have refused to pay.
Plaintiff alleges that TJM International and Marsh and Associates are the agent or alter ego of each other. Entity Defendants are "Merchants" as defined by the terms and conditions of Plaintiff's bills of lading. Plaintiff pleads the following counts: (1) for money due under tariff or service contracts per the Shipping Act, (2) breach of contract, (3) unjust enrichment, (4) quantum meruit, (5) account stated, and (6) attorney's fees. Plaintiff alleges Defendants are liable for the payment of invoiced amounts, interest due on outstanding and overdue sums, and reasonable attorney's fees and expenses incurred in collecting any sums due. Plaintiff alleges the services received by Defendants equals $62,437.50.
Plaintiff filed its complaint on July 16, 2018, and it was served on Defendants on July 19, 2018. Defendants, as of the date of this Opinion, have failed to appear in this action. The Clerk entered default on September 6, 2018 against Entity Defendants. On November 8, 2018, Plaintiff filed its Motion for Default Judgment against Entity Defendants. On April 18, 2019, this Court denied, without prejudice, Plaintiff's Motion for Default Judgment for failing to specify the claims and elements constituting the basis of the request for default judgment and for failing to file documents evidencing the contractual relationship between
This Court possesses jurisdiction over this case pursuant to 28 U.S.C. §§ 1331, 1333, and 1367. Plaintiff asserts a claim under a federal statute, the Shipping Act, 46 U.S.C. § 41102. Subject matter jurisdiction also lies in Admiralty.
In addition to subject matter jurisdiction, this Court must also be satisfied it possesses personal jurisdiction over Defendants.
It appears this Court possesses personal jurisdiction over Entity Defendants. Plaintiff alleges Entity Defendants are citizens of New Jersey. This Court is satisfied personal jurisdiction over Entity Defendants exists in this case on the basis of general jurisdiction.
The first step in obtaining a default judgment is the entry of default. "When 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). The Clerk entered default against Entity Defendants on September 6, 2018.
"Federal Rule of Civil Procedure 55(b)(2) authorizes courts to enter a default judgment against a properly served defendant who fails to a file a timely responsive pleading."
As discussed
The Shipping Act contains an implied private cause of action to collect fees owed pursuant to published tariffs.
Here, Plaintiff's Complaint alleges Entity Defendants knowingly and willfully failed and refused to pay Plaintiff the full amount due. (Pl.'s Compl. ¶ 8.) Because Plaintiff alleges Entity Defendants knowingly and willfully refused to pay, the first element is satisfied. Plaintiff alleges that it demanded Entity Defendants pay the full amount due and argues Entity Defendants directly failed to do so. (Pl.'s Compl. ¶ 7.) Because Plaintiff argues Entity Defendants directly failed to pay the amount due, the second element is met. Plaintiff's Complaint alleges Entity Defendants used unjust means to avoid payment of invoices through the use of TJM International and Marsh and Associates as agents or alter egos of each other. (Pl.'s Compl. ¶ 3.)
Plaintiff provides bills of lading, export invoices, and detention invoices that use TJM International and Marsh and Associates with the same billing address; New Jersey Business Entity Information and Records Service that assert Cheryl Marsh is the "Agent" of both TJM International and Marsh and Associates with the same address, 621 Beverly Rancocas Road, Ste. 114, Willingboro, NJ 08046; and an email signature and a website page that uses TJM International and Marsh and Associates interchangeably. (Pl.'s Amended Mot. for Default J., Ex. B, G, H, & I.) Because Plaintiff alleges Entity Defendants used unjust means to avoid payment, the third element is satisfied. Plaintiff alleges Entity Defendants obtained transportation at less than applicable rates. (Pl.'s Compl. ¶ 6.) Therefore, Plaintiff satisfies the fourth element.
Plaintiff also alleges a breach of maritime contract.
Here, Plaintiff alleges transportation was performed pursuant to written contracts of carriage and service contracts between Plaintiff and Entity Defendants. (Pl.'s Compl. ¶ 11.) Plaintiff provides the face page of Plaintiff's service contract with Entity Defendants. (Pl.'s Amended Mot. for Default J., Ex. D.) The first element is satisfied because Plaintiff alleges the existence of a contract. Plaintiff alleges it fully performed its tariff obligations, evidenced by service contracts, bills of lading, freight bills, invoices, credit agreements, and freight guarantees. (Pl.'s Compl. ¶ 11.) Because Plaintiff alleges it performed its obligation under the contract, the second element is met.
According to the terms and conditions of the bills of lading, the "Merchant," in this case Entity Defendants, is responsible for the payment of full freight and detention. Plaintiff alleges it demanded that Entity Defendants pay the amount due under the contracts and Entity Defendants have refused to pay thereon. (Pl.'s Compl. ¶ 13.) Because Plaintiff alleges Entity Defendants breached the contract, the third element is met. Plaintiff alleges Entity Defendants' breach caused damages equal to $62,437.50; therefore, the fourth element is met. (Pl.'s Compl. ¶ 14.) Accordingly, this Court finds Plaintiff has stated a claim for a breach of contract.
Plaintiff alleges there was a contract between Plaintiff and Entity Defendants, but pleads in the alternative a claim of unjust enrichment. Because this Court finds Plaintiff has adequately stated a breach of contract claim, this Court need not address this alternative theory.
For the sake of completeness, this Court will determine whether the elements of unjust enrichment are met. The elements a plaintiff must show are: (1) the defendants received a benefit and (2) the retention of that benefit without payment would be unjust.
Plaintiff alleges Entity Defendants were unjustly enriched by Plaintiff's services as a benefit was conferred, but not paid for. (Pl.'s Compl. ¶ 15.) Plaintiff alleges it transported cargo for the benefit of Entity Defendants. (Pl.'s Compl. ¶ 6.) This satisfies the first elements because Entity Defendants received the benefit of the transportation of its cargo. Plaintiff alleges Entity Defendants have been unjustly enriched because they failed to pay the ocean freight and detention charges, which amounted to $62,437.50. (Pl.'s Compl. ¶ 16.) This satisfies the second element because Plaintiff expected to be compensated for its service and the failure to pay enriched Entity Defendants. This Court finds Plaintiff has stated a claim for unjust enrichment.
Plaintiff alleges it is entitled to recover under the theory of quantum meruit. (Pl.'s Compl. ¶ 18.) However, Plaintiff cannot recover on quantum meruit when it is established there is an express contract because the parties are bound by their original agreement.
For the sake of completeness, this Court will determine whether the elements of quantum meruit are met here. To recover, a plaintiff must show: "(1) performance of services in good faith, (2) acceptance of the services by the person to whom rendered, (3) an expectation of compensation by the person performing the services, and (4) the reasonable value of the services."
Plaintiff alleges it fully performed its obligations under the contracts. (Pl.'s Compl. ¶ 12.) The first element is met because Plaintiff fulfilled the shipping services pursuant to the contract and there is no indication the services were performed in bad faith. Plaintiff alleges the service were accepted by Entity Defendants, as the contracts were completed and Plaintiff provides invoices with shipping and arrival dates. (Pl.'s Amended Mot. for Default J., Ex. B.) Because Plaintiff alleges the services were accepted by Entity Defendants, the second element is met. Plaintiff argues the parties had a "business relationship" and some of the invoices were partially paid for. This Court finds the third element is met because Entity Defendants have indicated they knew they would be required to pay the invoices for the service provided because they paid for portions of them in the past. Plaintiff alleges the reasonable value of the service has been presented by Plaintiff in the amount of $62,437.50; therefore, the fourth element is met. (Pl.'s Compl. ¶ 18.) This Court finds Plaintiff has stated a claim for quantum meruit.
Plaintiff alleges it is entitled to recover under the theory of account stated. (Pl.'s Compl. ¶ 21.) As stated
Here, Plaintiff alleges it issued bills of lading and invoices to Entity Defendants, which Entity Defendants knowingly and willfully refused to pay. (Pl.'s Compl. ¶¶ 8, 20.) The elements of an account stated claim are met because Plaintiff alleges Entity Defendants admitted indebtedness and an implied promise to pay it through the incomplete payment of the invoices. This Court finds Plaintiff has stated a claim of account stated.
The party seeking attorney's fees has the burden of proving that the requested fees are reasonable.
If Plaintiff wishes to be awarded attorney's fees, it should move within fourteen days following entry of the default judgment. Therefore, this Court reserves judgment on the issue of attorney's fees.
Because it has been determined that Plaintiff has stated viable causes of action for violations of the Shipping Act and breach of contract — or, in the alternative, unjust enrichment, quantum meruit, and account stated — it must be determined whether Plaintiff is entitled to default judgment. As stated
Plaintiff will be prejudiced absent a default judgment because Entity Defendants' failure to respond to Plaintiff's claims leaves Plaintiff with no other means to vindicate its claims. Plaintiff has performed the services contracted for and was not duly compensated.
"A claim, or defense, will be deemed meritorious when the allegations of the pleadings, if established at trial, would support recovery by plaintiff or would constitute a complete defense."
Entity Defendants' delay appears to be the result of culpable conduct. "Culpable conduct is dilatory behavior that is willful or in bad faith."
Moreover, because Entity Defendants are entities, they are not minors, they are not incompetent, and they have not been engaged in military service. Therefore, Entity Defendants' failure to appear in the action can be deemed willful, even without the benefit of the facts stated above.
Consequently, because this Court has found that Plaintiff shall be prejudiced if default judgment is not granted, Entity Defendants do not have a meritorious defense, and Entity Defendants' failure to appear in this case is the result of their culpable misconduct, judgment will be entered in Plaintiff's favor on its Shipping Act claim and breach of contract claim — or, in the alternative, its unjust enrichment, quantum meruit, and account stated claim. Thus, this Court will grant Plaintiff's Amended Motion for Default Judgment.
In order to determine what damages Plaintiff is entitled to for its judgment against Entity Defendants, this Court may "conduct hearings or make referrals — preserving any federal statutory right to a jury trial — when, to enter or effectuate judgment, it needs to . . . determine the amount of damages." FED. R. CIV. P. 55(b)(2);
A case is not sum certain when there are any questions or doubts about what amount the plaintiff is owed.
In this case, this Court finds it need not conduct an actual hearing as Plaintiff submitted declarations and provided invoices for the services rendered. Pursuant to the Shipping Act, a defendant may not obtain ocean transportation for property at less than the rates or charges that would otherwise apply. 46 U.S.C. § 41102. This Court finds the measure of damages is the summation of the remaining balances from Plaintiff's invoices to Entity Defendants. Without payment of this balance, Entity Defendants would be receiving ocean transport at a rate less than what would otherwise apply. The remaining balances from Plaintiff's invoices form the principal amount due:
(Pl.'s Amended Mot. for Default J., Ex. B.)
Plaintiff's invoices prove the balance owed by Entity Defendants; this Court finds that the damages are equal to the principal amount of $62,437.50.
(Pl.'s Amended Mot. for Default J., Ex. F.) This Court finds Plaintiff was damaged in the amount of $62,437.50 and spent costs in the amount of $489.99. This Court will enter final judgment in that amount of $62,926.49.
For the reasons stated herein, this Court will grant Plaintiff's Amended Motion
An appropriate Order will be entered.