United States District Court, D. Maryland
DeBORAH K. CHASANOW, District Judge.
Presently pending and ready for resolution in this priority of liens case is a motion for final judgment filed by Plaintiff CitiMortgage, Inc. (ECF No. 36). The issues have been fully briefed, and the court now rules, no hearing being deemed necessary. Local Rule 105.6. For the following reasons, the motion for final judgment will be granted.
The facts as alleged in the complaint are contained in a prior memorandum opinion. ( See ECF No. 31). This case involves the question of the priority of liens in real property owned by Defendant Leroy Holmes and Byrdie Blizzard-Holmes, located at 11101 Bennington Drive, Upper Marlboro, Maryland ("Property"). On June 6, 2013, Plaintiff filed a five count complaint in this court against Leroy Holmes, Byrdie Blizzard-Holmes, Kettering Community Association, Inc. ("Kettering"), State Farm Mutual Auto Insurance Company ("State Farm"), and the United States of America. The complaint alleges breach of contract (Count IV) and unjust enrichment (Count V) against the Holmeses only. (ECF No. 1). The complaint also includes claims for declaratory judgment (Count I), to quiet title (count II); and equitable subrogation (count III).
The complaint and summonses were properly served upon the Holmeses, Kettering, and State Farm, but none responded to the complaint. Consequently, default was entered against State Farm on September 16, 2013, and the Holmeses and Kettering on January 13, 2014. (ECF Nos. 13, 27, and 28). The United States filed a motion for partial summary judgment on Plaintiff's claim under the doctrine of equitable subrogation contained in Count III of the complaint, which the court granted on July 1, 2014. ( See ECF Nos. 31 & 32). The court issued an order determining that: (1) CitiMortgage holds a first priority lien only to the amount of the Ameriquest loan made to Mr. Leroy Holmes and Ms. Byrdie Blizzard-Holmes on December 7, 2002, originally for $159, 750.00; and (2) the United States possesses a second priority lien in the amount of $961, 820.00 that was filed for that amount on August 21, 2007. (ECF No. 32).
On July 18, 2014, Plaintiff filed a consent motion requesting that the court clarify the second portion of its order regarding the second-priority lien held by the United States. (ECF No. 34). Plaintiff pointed out that Mr. Leroy Holmes and Ms. Byrdie Blizzard-Holmes own the Property as tenants by the entirety and that the United States obtained a Restitution Order in the amount of $961, 820 against Leroy Holmes only in connection with a criminal case against him. Thus, the Restitution Order attached only to Mr. Holmes's interest in the Property and as such, the United States only possesses a secondpriority interest in the Property as to Mr. Leroy Holmes's interest in the Property. The court agreed and issued an order on July 21, 2014, amending the July 1, 2014 order to "confirm that Defendant United States of America possesses a secondpriority lien against the real property commonly known as 11101 Bennington Drive, Upper Marlboro, Maryland 20744, in the amount of $961, 820.00 pursuant to a Notice of Lien dated August 21, 2007 and recorded among the Land Records of Prince George's County, Maryland on November 20, 2007 as USA07-113 only as to Leroy Holmes' interest in that property." (ECF No. 35) (emphasis in original).
On November 10, 2014, Plaintiff CitiMortgage moved for final judgment against Defendants United States, Leroy Holmes, Byrdie Blizzard-Holmes, Kettering, and State Farm. (ECF No. 36). In this motion, Plaintiff indicates that it "now seeks a judgment confirming the Court's July 21, 2014 Order and entering a final judgment against all defendants establishing that Plaintiff holds a first-priority lien in the amount of $159, 750.00 on and against the Property, and that Defendant DOJ's second-priority lien only encumbers the one-half interest in the Property owned by Defendant Mr. Holmes. " (ECF No. 36, at 2-3) (emphases added). The respective rights of Plaintiff and the Government were already set forth in the July 1, 2014 order, as amended by the July 21, 2014 order, but will be set forth again in the final judgment. Plaintiff also seeks a final judgment adjudicating the rights of the remaining parties, namely Kettering, State Farm, and the Holmeses.
II. Standard of Review
Plaintiff's motion essentially seeks default judgment against Defendants Leroy Holmes, Byrdie Blizzard-Holmes, Ketering, and State Farm. Federal Rule of Civil Procedure 55(b)(2) authorizes the entry of default judgment against a properly served defendant who fails to file a timely responsive pleading. In reviewing a motion for default judgment, the wellpleaded factual allegations in the complaint as to liability are accepted as true. Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780-81 (4th Cir. 2001). It must still be determined, however, "whether these unchallenged factual allegations constitute a legitimate cause of action." Agora Fin., LLC v. Samler, 725 F.Supp.2d 491, 494 (D.Md. 2010).
Where, as here, a plaintiff seeks declaratory relief rather than monetary damages, default judgment is appropriate if the well-pleaded allegations of the complaint establish the plaintiff's right to such relief. See, e.g., Nautilus Ins. Co. v. BSA Ltd. P'Ship, 602 F.Supp.2d 641, 645-46 (D.Md. 2009) (awarding default judgment in declaratory judgment action); Am. Select Ins. Co. v. Taylor, 445 F.Supp.2d 681, 684 (N.D.W.Va. 2006) (same).
Plaintiff indicates that "[i]f the Court enters judgment in accordance with the proposed Order submitted with the instant [m]otion on Count I (Declaratory Judgment) and Count II (Quiet Title), Plaintiff is prepared to dismiss without prejudice Counts IV (Breach of Contract) and V (Unjust Enrichment) of the [c]omplaint." (ECF No. 36-1, at 4). The court previously granted partial summary judgment for the Government on the equitable subrogation claim in Count III. Plaintiff essentially seeks the same relief for its claim to quiet title (Count II) as with the declaratory judgment claim (Count I).
In the complaint, Plaintiff seeks declaratory judgment pursuant to Md. Code §§ 3-401 et seq. ( See ECF No. 1, at 6). The Maryland Declaratory Judgment Act, Md. Code Ann., Cts. & Jud. Proc. §§ 3-401, 3-406, states:
Any person interested under a deed, will, trust, land patent, written contract, or other writing constituting a contract, or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, administrative rule or regulation, contract, or franchise, may have determined any question of construction or validity arising under the instrument, statute, ordinance, administrative rule or regulation, land ...