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Nationwide General Insurance Co. v. McCoy

United States District Court, N.D. Mississippi, Aberdeen Division

March 4, 2019

NATIONWIDE GENERAL INSURANCE COMPANY PLAINTIFF
v.
MICHAEL McCOY DEFENDANT

          ORDER

          MICHAEL P. MILLS UNITED STATES DISTRICT JUDGE.

         This cause comes before the Court on Plaintiff's Motion for Default Judgment [Doc. #12]. The Court has reviewed the motion, along with relevant authorities, and is now prepared to rule.

         I. Factual Background

         On April 3, 2018, Nationwide General Insurance Company commenced this action by filing its complaint against Michael McCoy. In its complaint, Nationwide states that it “issued a homeowner's policy of insurance to Defendant, specifically Policy No. 6323HO727328 . . . affording coverage to [Defendant's] property” located in Booneville, Prentiss County, Mississippi for “an effective period commencing April 3, 2017 and continuing through April 3, 2018.” [Doc. #1]. In seeking coverage, Defendant submitted a completed application to Nationwide in which his response to the question “2. Have you or a member of your household been convicted of a felony in the past 10 years?” was “No”. The policy issued by Nationwide to Defendant included various provisions detailing coverage and a provision dealing with concealment and fraud.

         On or about September 10, 2017, a fire occurred at the Defendant's residence. Defendant later made a claim detailing the damage and loss of his home and the contents lost. Immediately, Nationwide investigated the loss. The preliminary investigation revealed that Defendant denied having any felony convictions in the past ten years, as detailed in the Policy Application and Supplemental Application. [Doc. #1-B]. However, through a record search, Nationwide discovered “approximately fifteen (15) charges against Defendant.” [Doc. #1].

         Nationwide is of the opinion that “the fire was intentionally set” because “Defendant had insufficient personal income to me[e]t his financial obligations.” Id. The home was insured in the following amounts: Dwelling-$175, 289; Personal Property-$122, 702; Other Structures-$17, 528; and Loss of Use-$35, 057.

         On April 4, 2018, a summons was issued as to Defendant. On April 11, 2018, the summons was personally served on Defendant, at his residence, by Constable Sammy Henderson. A proof of service was filed with the Court on April 17, 2018.

         On June 14, 2018, the Clerk of Court issued its first Notice of Default and later issued its second notice on July 17, 2018. [Doc. #4, #5].

         On August 8, 2018, the Court, on its own motion, dismissed this cause without prejudice because of Plaintiff's failure to request an entry of default after two notices had been issued. On September 11, 2018, the Court granted Plaintiff's Motion to Reinstate the Case, [Doc. #8], and instructed the Plaintiff to follow the proper procedure for deaults. [Doc. #9]. Two days later, on September 13, 2018, Plaintiff filed its Motion for Entry of Default, [Doc. 10]. The Clerk of Court made an entry of default on September 20, 2018, [Doc. #11].

         On September 27, 2018, Plaintiff filed this Motion for Default Judgment [Doc. #12]. As of the date of this motion, and this Order, Defendant has not appeared to defend this case.

         II. Standard

         The Federal Rules of Civil Procedure permit the entry of a default judgment against a party who “has failed to plead or otherwise defend, and that failure is shown by affidavit or otherwise.” Fed.R.Civ.P. 55(a). However, default judgments are “generally disfavored by the law, ” as courts “prefer to reach a judgment on the merits of the case, and not to terminate litigation by [a] procedural maneuver.” Shakir v. Fed. Nat'l Mortg. Ass'n, 2015 WL 4997100, at *2 (N.D. Miss. Aug. 20, 2015) (citing Sun Bank of Ocala v. Pelican Homestead and Sav. Ass'n, 874 F.2d 274, 275 (5th Cir. 1989)). But although the default judgment remedy is disfavored, that policy is “counterbalanced by considerations of social goals, justice and expediency[.]” Rogers v. Hartford Life and Acc. Ins. Co., 167 F.3d 933, 936 (5th Cir. 1999).

         III. Discussion

         This Court has held that in order to properly resolve a motion for default judgment, the Court should consider three factors: “(1) whether default judgment is procedurally warranted; (2) whether the pleadings sufficiently set forth facts establishing that the movant is entitled to the relief sought; and (3) what relief, if any, the movant should receive.” Shakir, 2015 WL 4997100, at *2 (citing U.S. v. Giles, 538 F.Supp.2d 990, 993 (W.D. Tex. 2008)). Ultimately, the weighing process of whether ...


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