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Alostar Bank of Commerce Inc. v. Charlton

United States District Court, N.D. Georgia, Atlanta Division

March 7, 2017

ALOSTAR BANK OF COMMERCE INC, assignee of and successor in interest to Federal Deposit Insurance Corporation as receiver for Nexity Bank, Plaintiff,
v.
GARETTE CHARLTON, Defendant.

          OPINION AND ORDER

          WILLIAM S. DUFFEY, JR. UNITED STATES DISTRICT JUDGE

         This matter is before the Court on Plaintiff Alostar Bank of Commerce (Inc)'s (“Alostar”) Motion for Default Judgment by the Clerk of this Court Pursuant to Fed.R.Civ.P. 55(b)(1) Against Defendant Garette Charlton (“Charlton”) [7].

         I. BACKGROUND

         A. Facts

         Alostar is a domestic banking corporation incorporated in Alabama with its principal place of business in Birmingham, Alabama. (Compl. [1] ¶¶ 1, 4(a)). Charlton is a citizen of Georgia. (Id.).

         On September 27, 2004, Charlton applied for and obtained a home equity line of credit (“HELOC”) in the amount of $76, 300 from Nexity Bank, Plaintiff's predecessor-in-interest.[1] ([1] ¶ 5; HELOC Agreement, Ex. A [1.1]). The HELOC was secured by a deed to Charlton's property located in Marietta, Georgia. ([1] ¶ 7; Deed to Secure Debt, Ex. C [1.1]). On June 23, 2006, the HELOC was renewed, and the line of credit was increased to $83, 000. ([1] ¶ 6; HELOC Renewal Agreement, Ex. B [1.1]).[2]

         From October 2004 to December 2008, Charlton withdrew from the HELOC a total principal balance of $75, 980.53. (Statement, Ex. E [1.1]). Beginning February 5, 2016, Charlton became delinquent on the payments. ([1] ¶ 9; Statement, Ex. E [1.1]).

         Alostar's Complaint alleges that Charlton owes (i) unpaid principal balance in the amount of $75, 924.41; (ii) late fees of $30.33; (iii) prejudgment interest at the rate of 3.25% per annum; (iv) postjudgment interest; (v) court costs; and (vi) attorneys' fees pursuant to O.C.G.A. § 13-1-11. ([1] ¶ 13(a)-(h); Statement, Ex. E [1.1]).

         B. Procedural History

         On May 4, 2016, Alostar filed this action to collect on debt owed under the HELOC. ([1]). On August 17, 2016, Alostar served the Complaint on Charlton. ([5]). Charlton failed to respond, and no counsel appeared on his behalf.

         On September 23, 2016, Alostar filed its Motion for Clerk's Entry of Default [6] based on Charlton's failure to respond to the Complaint. Later that day, the Clerk entered default against Charlton.

         On September 28, 2016, Alostar moved for default judgment. ([7]).

         II. DISCUSSION

         A. Legal Standard

         Rule 55(b) of the Federal Rules of Civil Procedure provides that default judgment may be entered against defaulting defendants as follows:

(1) By the Clerk. If the plaintiff's claim is for a sum certain or a sum that can be made certain by computation, the clerk-on the plaintiff's request, with an affidavit showing the amount due-must enter judgment for that amount and costs against a defendant who has been defaulted for not appearing and who is neither a minor nor an incompetent person.
(2) By the Court. In all other cases, the party must apply to the court for a default judgment. . . . If the party against whom a default judgment is sought has appeared personally or by a representative, that party or its representative must be served with written notice of the application at least 7 days before the hearing. The court may ...

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