United States v. Mauldin

• Court: District Court, Virgin Islands
• Decided: January 23, 2020
• Docket: 1:18-cv-00033
• Status: Unknown

Opinion

DISTRICT COURT OF THE VIRGIN ISLANDS

DIVISION OF ST. CROIX ║

UNITED STATES OF AMERICA (Rural ║ Development, formerly known as the ║ Farmers Home Administration), ║ 1:18-cv-00033 ║ Plaintiff, ║ ║ v. ║ ║ LAMAR C. MAULDIN, surviving spouse ║ of THERESA MATHURIN, also known as ║ Theresa Sonya Mathurin Mauldin, ║ deceased, the unknown heirs, ║ devisees, grantees, assignees, lienors, ║ creditors, trustees, or other claimants ║ by, through, under or against Theresa ║ Mathurin, deceased; and all other ║ parties having a claim, right, title, or ║ interest in the property herein, ║ ║ Defendants. ║ ________________________________________________ ║ TO: Angela P. Tyson-Floyd, Esq., AUSA Lamar C. Mauldin, Pro Se 14870 Gilbert St., Unit A Choctaw, OK 73020-8742

MEMORA NDUM OPINION

1 THIS MATTER is before the Court upon Plaintiff United States of America’s (“Plaintiff”) “Motion For Default Judgment Against All Unknown Defendants and for Summary Judgment Against Defendant Lamar C. Mauldin” (ECF No. 21). On January 14, 2020, the Court granted Defendants an additional week to submit their responses. (ECF No. 1 The parties consented to having this case referred to the Magistrate Judge to conduct all proceedings, United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 2

24). Defendant Lamar C. Mauldin (“Mauldin”) submitted a “Response Brief” (ECF No. 26 at 1) that was dated January 17, 2020, docketed on January 22, 2020, and in which he stated “[t]here is no objectioIn. to theF pArCoTcUeeAdLin AgNs Dof PthRiOs CCEouDrUt.R” AL HISTORY On or about February 26, 1993, Theresa Mathurin (“Mathurin”), now deceased, executed and delivered to the United States, acting through Rural Development, also known as the Rural Housing Service, f/k/a the Farmers Home Administration, an agency of the U.S. Department of Agriculture, a promissory note (“Note”) in which she promised to pay the United States the principal sum of Eighty Five Thousand dollars ($85,000.00), plus interest at the rate of 7.75000 percent per annum in monthly installments beginning June 26, 1993 (ECF No. 11-1). Also on February 26, 1993, as security for payment of the Note, Mathurin

executed and delivered to the United States a real estate mortgage (the “Mortgage”) encumbering the following described real property located on St. Croix in the Territory of the United States Virgin Islands: Plot No. 142, consisting of 0.230 U.S. Acres, more or less, of Estate Humbug, King Quarter, St. Croix, as more fully shown in PWD Drawing No. 3254 dated 2 December 2, 1975 as revised March 13, 1978

(the “Property”). By its terms, the Mortgage secures payment of the indebtedness owed by Mathurin to Plaintiff under the Note. The Mortgage was recorded in the Office of the Recorder of Deeds for St. Croix on February 26, 1993, at Official Record Book 458, page 215, United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 3

Doc. No. 1079/1993. (ECF No. 21-1 at 2). On or about February 26, 1993, Mathurin also entered into a Subsidy Repayment Agreement with the United States providing for the United States to recapture interest credits granted to Mathurin upon foreclosure of the Mortgage. (ECF No. 11-3). On or about June 27, 1997, Mathurin and Plaintiff entered into a Reamortization and/or Deferral Agreement (“Reamortization Agreement”), which provided that a payment in the amount of $638.00 would be due and payable on July 26, 1997, and that thereafter, monthly installments in the amount of $638.00, would be due and payable on the 26th day of each month, with the final installment on the indebtedness due and payable on February 26, 2026, if not sooner paid. (ECF No. 11-4). Mathurin died intestate on May 10, 2001, with title to the property in her name at the time of her death. (ECF No. 11-5). Mauldin has an interest in the aforesaid real property as the surviving spouse of Mathurin. (ECF No. 23 at 2, ¶ 6). Mathurin had no children at the time of her death, and her parents are now deceased. (ECF No. 23-5 at ¶¶ 5I-d9. ). Mauldin attempted to probate his wife’s estate, but his attempts were unsuccessful. ( at ¶¶ 6-11). Nobody has paid the monthly installment due on February 26, 2012, or any other subsequent installment. (ECF No. 23 at 3, ¶ 15). Plaintiff filed this action on July 27, 2018 to foreclose on the Mortgage. (ECF No. 1). Mauldin answered on October 23, 2018. (ECF No. 4). Plaintiff filed an Amended Complaint on April 12, 2019 (ECF No. 11), and Mauldin

answered on May 6, 2019 (ECF No. 12). Notice of this action was then published in the St. United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 4

devisees, grantees, lien holders, creditors, trustees, or other claimants, claiming any right, title or interest in the Property. (ECF Nos. 18, 18-1). As of the date of Plaintiff’s motion, no answer or responsive pleading has been filed by the Unknown Defendants. (ECF No. 23-1 at ¶¶ 2-3; ECF No. 23-5 at ¶¶ 5-13). On November 1, 2019, the Clerk of the Court entered defaults against defendants “the unknown heirs, devisees, grantees, assignees, lienors, creditors, trustees, or other claimants by, through, under or against the deceased borrower, Theresa Mathurin, and all other parties having a claim, right, title, or interest in Plot No. 142, Estate Humburg, St. Croix, U.S. Virgin Islands” (the “Unknown Defendants”) for failure to answer, plead, or otherwise defend this action. (ECF No. 20). As of November 15, 2019, the debt owed to Plaintiff is as follows: principal in the amount of $65,780.93; interest in the amount of $39,136.05, and costs and fees in the amount of $44,609.84, for a total indebtedness of $149,526.82. The current total indebtedness includes interest and fees that have accumulated on the debt since the last certificate of indebtedness (ECF No. 11-7) was filed with the United States’ Amended Complaint of Foreclosure on April 12, 2019. (ECF No. 11). Interest continues to accrue at the rate of 7.7500 percent ($13.9671II p. er diAePmP)L uInCtAilB tLhEe dLaEtGeA oLf jPuRdgINmCeInPtL. ES A. Default Judgment

Default judgment may be entBeraendk “oafg aNionvsat aS pcortoipae vrl. yD saevrivsed defendant who fails to United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 5 Anchorage

4A3ss5o5c1. v7.7 V, .Ia. tB *d4. o(fD T.Va.xI .R Seevp.t. 11, 2018) (citing Fed. R. Civ. P. 55(b) and quoting , 922 F.2d 168, 177 n.9 (3d Cir. 1990)). Further, as this Court has held: An application for entry of default judgment must contain evidence, by affidavits and documents, of: “(1) the entry of default pursuant to Rule 55(a); (2) the absence of any appearance by any party to be defaulted; (3) that the defendant is neither an infant nor an incompetent; (4) that the defendant has been validly served with all pleadings; (5) the aImnto’lu Unnt ioofn j uodf gPmaienntet rasn adn hdo w iAtl wlieads Tcraalcduelsa Dteidst;. (C6o)u anncdil a7n1 1a fHfiedaalvtiht aonf dn oWne-mlfailrieta, Vrya csaetrivoinc ea innd c Foimnipshliianngc e wTriathd etsh eIn Ssot.l dFiuenrds’s avn. Vd iSllaaigloer Gsl’ aCsisv, iIln Rce.,lief Act.” see also Island Yacht Charters, Inc. v. Malgaglio, 2012 WLT 2u0r9k0 v7. 6In, vaat c*a1r (eD C.Nor.Jp. .J,an. 3, 2012); Fed. R. Civ. P. 55(b); 2009 WL 1507406, at *1 (D.V.I. May 28, 2009); 2010 WL 4740196, at *3 (W.D. Pa. Nov. 16, 2010). Additionally, the Court must assess three factors when determining whether default judgment is appropriate: “(1) prejudice to the plaintiff if deCfahualmt ibse drelaniine dv., G(2ia) mwphaepthae, r the defendant appears to have a litigable defense, and (3) whether defendant’s delay is due to culpable conduct.” 210 Idewu vF. .S3eda 1le5y4, 164 (3d Cir. 2000).

B. Sum,m Ciavrily A Juctdiognm Neon.t 2 011-038, 2012 WL 944781, at *2 (D.V.I. Mar. 19, 2012).

Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any masetee raialslo f,a ec.gt .a, Cnodn tkhlein m v.o Avnatnhto ius entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); , No. 12-1466, 2012 WL 3802281 at *2 and n.4 (3d Cir. Aug. 30, 2012) (unpublished) (slip copy). “[T]here is no issue for trial unless there is sufficAinednet resvoind evn. Lceib fearvtyo rLinobgb tyh,e I nnco.n-moving party for a jury to return a verdict for that party.” , 477 U.S. 242, 249 (1986). As the United States United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 6

himself to weigh the evidence and deterImdine the truth of the matter but to determine whether there is a genuine issue for trial.” . In making thisS deee,t eer.gm., iBnda.t oiof nE,d tuhce. Cvo. Euartr ldsraws all reasonable inferenAcersm ibnr fuasvtoerr vo.f Uthneis nyso nCo-mrpo.ving party. , 536 U.S. 822, 850 (2002); , 32 F.3d 768, 777 (3d Cir. 1994). “‘Generally, debt actions are well suited for summary judgment. Because of the relative simplicity of the issues involved, suits to enforFclea gpsrtoamr iBsasonrky, FnSoBt evs. Layrlee samong the most suitable classes of cases for summary judgment.’” , 2017 WL 987448, at *3 (D.V.I. March 14, 2017) (internal quotation marks and citations omitted). To succeed on a debt and foreclosure action, the plaintiff must show: (1) the debtor executed a promissory note and mortgage; (2) the debtor is in default under the terms of the note and mortgage; and (3) thIed .lender is authorized to foreclose on the propertsye em aolrsotgAangethdo nays sve. FcuirrsittBya fnokr Vthireg nino tIesl.a nd s (internal quotation marks and citations omitted); Th ompson v. Florida Wood Treaters,, I2n0c1.3 WL 211707, at *5, 58 V.I. 224 (V.I. 2013) (quoting , 2009 WL 4730784, at *3 (D.V.I. Dec. 6, 2009)); Am. Jur. 2d Mortgages § 633 (2008) (foreclosure requires valid mortgage, default on part of mortgagor, and foreclosure in compliance with ItIeIr.m s oDf IcSoCnUtrSaScItO).N A. Default Judgment Against the Unknown Defendants

Plaintiff has submitted the Note, Mortgage, and a Reamortization and Deferral

Agreement signed by Mathurin, which show that she promised to pay the debt owed, and United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 7

would recoup any subsidies provided to her in the event of her default. Thus, Plaintiff has the authority to foreclose on the PropCehrtaym thbeart lsaeinrv es as security for Mathurin’s debt. The Court has consider eSde eth Ceh amberlain factors and finds that each factor weighs in favor of default judgment. , 210 F.3d at 164 (identifying prejudice to plaintiff if default is denied, existence of a litigable defense, and defendant’s culpability in the default as the three factors courts consider to determine whether to grant default judgment). Specifically, the Court finds that Plaintiff is likely to be prejudiced if default judgment is denied given that 1) the Unknown Defendants have failed to answer any correspondence from Plaintiff and 2) Plaintiff has no other remedy at Slaewe Uonr ieteqdu iSttya ttoe sr evc. oJaump ipsoaynment of its debt other than to foreclose and sell the Property. , 2015 WL 3797996, at *6 (D.V.I. June 17, 2015) (finding that denial of the motion for default judgment would prejudice the plaintiff “given [the d]efendant’s failure to answer any correspondence from [the p]laintiff”). In addition, despite notice of this action by publication in a newspaper of general circulation in the U.S. Virgin Islands, the Unknown Defendants have failed to appear and/or raise any defenses in this matSteeer.W Torhledi rE nutn’mrets Ipnocn. svi.v Bernoewssn ,to this action demonstrates their culpability in the default. 487 F. Apinpt’exr. 7al5ia8,, 762 (3d Cir. 2012) (finding that defendant engaged in culpable conduct by, failing to respond to complaHinrti tbz evc.a Wusoem sau Ccho rfpa.,ilure showed a willful disregard for plaintiff’s legal communications); 732 F.2d 1178, 1183 (3d Cir. 1984)

(finding that culpability requires “more than mere negligence” and that “[r]eckless disregard United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 8 Cohen v. Gabriel Enters., Inc.,

standard”); 2013 WL 1154847, at *5 (D.V.I. Mar. 21, 2013) (citing cases finding culpable conduct where defendants failed to answer complaint). AccordiBn.g lSyu, dmemfaualrty j uJuddgmgmenetn atg Aaginasitn tshte D Uenfeknndowannt DLeafmenadra Cn.t Ms iasu alpdpinro priate. The essential facts as to Plaintiff’s claim against Mauldin are undisputed. S Meea uldin has an interest in the real property at issue as the surviving spouse of Mathurin. V.I. Code Ann., tit. 15, § 84(4) (“If the deceased leaves a surviving spouse, and no descendant, parent, brother or sister, nephew or niece, the surviving spouse shall be entitled to the whole thereof”). Mauldin’s interest, however, is inferior and subordinate to that of Plaintiff. Plaintiff has submitted a copy of the Note, dated February 26, 1993, executed by Mathurin, in which she promised to pay Plaintiff the principal sum of $85,000.00, plus

interest at the rate of 7.75 percent per year in monthly installments. (ECF No. 1-1). Plaintiff also submitted a copy of the Mortgage, dated February 26, 1993, executed by Mathurin to secure payment on the Note. (ECF No. 1-2). In his Answer, Mauldin admitted that Mathurin executed the Note and Mortgage. (ECF No. 4 at ¶¶ 6-7). Accordingly, there is no genuine dispute of material fact as to whether Mathurin executed these documents, and Plaintiff has satisfied the first requirement to succeed on a debt and foreclosure action in the Virgin Islands. Mauldin is in default on the Note and Mortgage for failing to make payments due

under those documents. Plaintiff asserts that it owns and holds the Note and Mortgage, United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 9

Failure to pay when due any debt evidenced hereby or performance any covenant or agreement hereunder shall constitute default under this instrument and any other instrument evidencing a debt of Borrower owing to, insured or guaranteed by the Government or securing or otherwise relating to such a debt; and default under any such other instrument shall constitute default hereunder. UPON ANY SUCH DEFAULT, the Government at its option may declare all or any part of any such indebtedness immediately due and payable.

(ECF No. 1-1 at 3). The Mortgage similarly provides that, if the Borrower defaulted, Plaintiff may “declare the entire amount unpaid under the note and any indebtedness to the Government hereby secured and immediately due and payable.” (ECF No. 1-2 at 4). Plaintiff has thus satisfied the second and third requirements for a debt and foreclosure claim. The Court finds that this evidence is sufficient to shift the burden to Mauldin to “set forth specific facts showing that a genuine issue of material fact exists and that a reasonHabalret fva. cEt-lfeicntdroenr icco uAlrdt sr, uIlnec i.n, his favor” regarding the debt and foreclosure causes of action. 717 F.3d 141, 148 (3d Cir. 2015). While Mauldin answered the Complaint, he has not responded to Plaintiff’s Motion for Summary Judgment. Thus, there is no challenge to any of the material facts contained in Plaintiff's Motion for Summary Judgment. In view of the foregoing, the Court finds that there is no genuine issue of material fact regarding Mauldin’s liability on Plaintiff’s debt and foreclosure causes of action. Because Plaintiff has satisfied the requirements for debt and foreclosure under Virgin Islands law, summary judgment is appropriate. United States v. Mauldin 1:18-cv-00033 Memorandum Opinion Page 10 IV. CONCLUSION

For the reasons discussed above, Plaintiff’s “Motion For Default Judgment Against All Unknown DeGfRenAdNaTnEtsD and for Summary Judgment Against Defendant Lamar C. Mauldin” (ECF No. 21) is . An appropriate Order accompanies this Memorandum Opinion.

ENTER: Dated: January 23, 2020 /s/ George W. Cannon, Jr. GEORGE W. CANNON, JR. MAGISTRATE JUDGE