Plaintiff's Counsel: Christopher Keach, Esq. Molleur Law
Defendant's Counsel: Sigmund Schutz, Esq. Preti Flaherty
ORDER ON PENDING MOTIONS
the court are Plaintiffs Motion for Default Judgment;
Defendant's Motion to Set Aside Clerk's Entry of
Default, and Plaintiffs Motion to Strike the Late-Filed
Answer of Defendant, together with the parties'
respective oppositions and reply memoranda. Oral argument on
the motions was held April 3, 2018.
case, Plaintiff Andrew Beebe contends that Citifinancial,
Inc. wrongfully recorded an execution lien against his
primary residence, which he says is exempted, statute from
being levied against by reason of its value and the balance
of a principal mortgage. See 14 M.R.S. §
4422(1)(B). His complaint alleges that Citifinancial, Inc.
has failed or refused to discharge its lien, and is therefore
liable to him under 14 M.R.S. §4651-A(8).
complaint names OneMain Financial as the Defendant, on the
ground that OneMain Financial was formerly known as
Citifinancial, Inc. The record includes a return of service
indicating that the summons and complaint were served on CT
Corporation, designated agent for OneMain Financial on
December 26, 2017. Accordingly, Defendant's answer was
due January 15, 2018. See MR. Civ. P. 12(a). On
February 12, 2018, Plaintiff filed a request for entry of
default and default judgment based on OneMain Financial's
failure to answer or otherwise plead. On February 13, 2018,
Plaintiff filed Motion for Entry of Default Judgment. The
Clerk entered default on February 14, 2018.
February 20, 2018, more than a month after the due date,
OneMain Financial filed an Answer to the Complaint, and on
February 23, 2018, it filed a Motion to Set Aside Clerk's
Entry of Default. Plaintiff opposes the Motion and has filed
his Motion to Strike.
resolution of Plaintiffs two motions-for default judgment and
to strike late answer-depends on the resolution of
Defendant's motion to set aside the default. Under Rule
55(c) of the Maine Rules of Civil Procedure, Defendant's
burden is to show "good cause" for setting aside
Maine Law Court has said that a defaulted party's showing
of good cause for purposes of Rule 55(c) has two elements:
"a good excuse for his or her untimeliness and a
meritorious defense." Truman v. Browne, 2001 ME
182, P 9, 788 A.2d 168, 170. The Law Court has also noted
that "[t]he good excuse and the meritorious defense
requirements are two distinct components, both of which must
be satisfied in order to prevail on a Rule 55(c)
motion." Levine v. KeyBank National
Association, 2004 ME 131, ¶20, 861 A.2d 678,
quoting Hart v. Terry L. Hopkins, Inc., 588 A.2d
1187, 1190 (Me. 1991). Although the defaulted party bears the
burden of showing good cause, there is a strong judicial
preference for adjudicating cases on their merits.
case, OneMain Financial has met the meritorious defense
component of "good cause," because its Motion to
Set Side Clerk's Entry of Default presents evidence that
it is not, in fact, formerly known as Citifinancial, Inc.,
and that another entity is the successor in interest to
Citifinancial, Inc. This evidence is not conclusive, and
Plaintiff has pointed to misleading information on OneMain
Financial's website that undercuts OneMain's
contention. However, to the extent Plaintiff contends that
OneMain Financial has to prove that it is not a successor to
CitiFinancial, that contention overstates OneMain's
burden. On the merits, it would likely be Plaintiffs burden,
not OneMain's, to prove that OneMain is liable for
CitiFinancial's alleged wrongdoing. OneMain has generated
an issue as to its liability that is sufficient to satisfy
the meritorious defense component of "good cause."
showing of a good excuse for its untimely response is not as
strong. The filings do show that OneMain was in touch with
Plaintiffs counsel early in January 2018, before the due date
of OneMain's answer, and that around the middle of
January 2018, OneMain sent material to Plaintiffs counsel
that OneMain contends supports its contention that Plaintiff
has named the wrong entity as Defendant.
more than a month went by after that. OneMain apparently
contends that it was waiting to hear back from Plaintiffs
counsel, but Plaintiffs counsel correctly point out that they
were not required to respond or to concede to OneMain's
contention that it is not a successor to ...