United States District Court, D. Utah
MEMORANDUM DECISION AND ORDER GRANTING IN PART AND
DENYING IN PART PLAINTIFF'S MOTION FOR ENTRY OF DEFAULT
N. Parrish, United States District Court Judge.
Judge Jill N. Parrish This matter comes before the court on a
motion for entry of default judgment filed by plaintiff
Schneider Finance, Inc. on January 29, 2019. (ECF No. 29).
For the reasons below, that motion will be granted in part
and denied in part.
leased a commercial freight truck and accompanying HVAC
system to defendant Stillwater Trucking pursuant to a lease
agreement executed on July 17, 2017. Defendant Dan Welch
executed a document by which he individually guaranteed
Stillwater's obligations under the lease agreement.
Stillwater made several required payments before defaulting.
complaint followed on July 30, 2018. (ECF No. 2). Neither Mr.
Welch nor Stillwater Trucking has responded, and on October
29, 2018, the Clerk entered a default certificate against
both defendants. (ECF No. 17).
Judgment is appropriate when “a party against whom a
judgment for affirmative relief is sought has failed to plead
or otherwise defend, and that failure is shown by affidavit
or otherwise.” Fed.R.Civ.P. 55 (a). However,
“when entry of a default judgment is sought against a
party who has failed to plead or otherwise defend, the
district court has an affirmative duty to look into its
jurisdiction both over the subject matter and the
parties.” Williams v. Life Sav. & Loan,
802 F.2d 1200, 1202-03 (10th Cir. 1986).
court finds that Schneider has shown that this court may
exercise personal jurisdiction over defendants as follows. As
to defendant Dan Welch, Schneider has submitted proof that it
effected personal service on Dan Welch within the state of
Utah. See Burnham v. Super. Ct., 495 U.S. 604, 619
(1990) (“The short of the matter is that [personal]
jurisdiction based on physical presence alone constitutes due
process because it is one of the continuing traditions of our
legal system that define the due process standard of
‘traditional notions of fair play and substantial
justice.'”). As to defendant Stillwater Trucking,
Schneider submits that Stillwater is an LLC organized under
the laws of Utah.
court also finds that Schneider has established subject
matter jurisdiction under 28 U.S.C. § 1332 insofar as
plaintiff Schneider-a corporation organized under the laws
of, and with its principal place of business in, the state of
Wisconsin-is diverse from defendant Dan Welch-a citizen of
Utah-and defendant Stillwater Trucking-a Utah LLC whose sole
member is Utah citizen Dan Welch. Schneider's complaint
averred that the amount in controversy exceeded $75, 000, a
good-faith estimate that has been borne out by the default
judgment amounts sought.
court has carefully reviewed the contract and guaranty on
which this lawsuit is predicated and finds that Schneider is
entitled to the relief requested in the amounts requested
with two exceptions. Schneider seeks prejudgment and
post-judgment interest under Utah law, but as explained
below, the contract's choice-of-law provision requires
this court to apply Wisconsin's prejudgment interest law,
post-judgment interest on federal judgments is governed by
federal court sitting in diversity applies the substantive
law of the state in which it sits, including the state's
choice of law rules. Klaxon Co. v. Stentor Elec. Mfg.
Co., 313 U.S. 487, 496 (1941). Thus, this court applies
Utah choice of law rules to any conflict of law issues
arising in a diversity action such as this one. In contract
disputes, Utah courts apply “the law chosen by the
parties if they have made an effective choice.” See
Am. Nat'l Fire Ins. Co. v. Farmers Ins. Exch., 927
P.2d 186, 188 (Utah 1996) (quoting Restatement (Second) of
Conflict of Laws § 205 cmt. b). Here, by all
appearances, the parties made an effective choice that
Wisconsin law govern their contract.
follows “the common-law rule that a party can recover
pre[judgment] interest only on damages that are either
liquidated or determinable by a ‘reasonably certain
standard of measurement.'” Beacon Bowl, Inc. v.
Wis. Elec. Power Co., 501 N.W.2d 788, 802 (Wis. 1993).
And “when work is performed under a contract and the
fee for services is not disputed, prejudgment interest is
allowed.” Paige v. Waukesha Health Sys., Inc.,
No. 12-C-0601, 2013 WL 3560944, at *6 (E.D. Wis. July 11,
2013). Wisconsin courts apply a 5% interest rate under
Wisconsin Statute § 138.04. Thus, Schneider is entitled
to prejudgment interest at the 5% interest rate allowed in
Wisconsin. Schneider submits that prejudgment interest began
accruing on October 26, 2018. Since that date, 180 days have
elapsed, and interest has been accruing on $58, 491.96-the
amount owing when Schneider terminated the lease-leading to a
prejudgment interest award of $1, 442.26.
contrast, a choice of law provision will not overcome the
presumption that the federal post-judgment interest rate
applies. Rather, absent “clear, unambiguous and
unequivocal [contractual] language” expressing the
parties' intent that a different post-judgment interest
rate apply, post-judgment interest is governed by federal
law. See Soc'y of Lloyd's v. Reinhart, 402