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Phillips, Goldman, McLaughlin & Hall, P.A. v. City Club Apartment, LLC

Superior Court of Delaware

July 16, 2019

PHILLIPS, GOLDMAN, MCLAUGHLIN & HALL, P.A. Plaintiff,
v.
CITY CLUB APARTMENT, LLC, Defendant.

          MEMORANDUM ORDER DENYING DEFENDANT CITY CLUB APARTMENT, LLC'S MOTION TO VACATE DEFAULT JUDGMENT

          Eric M. Davis, Judge.

         Upon consideration of City Club Apartment, LLC's Motion to Vacate Default Judgment (the "Motion") filed by City Club Apartments, LLC ("CCA"); Phillips, Goldman, McLaughlin & Hall, P.A.'s Response in Opposition to City Club Apartment, LLC's Motion to Vacate Default Judgment (the "Response") filed by Phillips, Goldman, McLaughlin & Hall, P.A. ("PGMH"); the Affidavit of Marc Newman; the affidavit of Jamie Robinson; the April 29, 2019 hearing on the Motion and Response; the letter, dated May 3, 2019, from Donald A. Gouge, Esq., to the Honorable Eric M. Davis and attached proposed answer and counterclaims; the letter, dated May 10, 2019, from Lisa C. McLaughlin, Esq., to the Honorable Eric M. Davis; the letter, dated May 14, 2019, from Donald A. Gouge, Esq., to the Honorable Eric M. Davis; the letter, dated May 17, 2019, from Donald A. Gouge, Esq., to the Honorable Eric M. Davis; all exhibits and attachments to the Motion, the Response and the various letters; the docket in In re Morrow Park Holding LLC, C.A. No. 2017-0036-TMR; the entire record of this civil proceeding, the Court has determined that no additional hearing is necessary on the Motion, the Response or the additional letter filings.

         The Court, exercising its discretion on the facts presented here, finds that CCA has failed to demonstrate that mistake, inadvertence, surprise or excusable neglect exists to vacate the default judgment entered on March 8, 2019 (the "Default Judgment"). Accordingly, the Motion is DENIED.

         I. RELEVANT FACTS

         This Civil proceeding

         PGMH commenced this case with the filing of its complaint on January 16, 2019 (D.I. No. 1). PGMH had CCA served on February 13, 2019 (D.I. No. 4). CCA needed to file a response to the complaint by March 5, 2019.

         On March 8, 2019, PGMH obtained the Default Judgment to the Plaintiff's Direction for Entry of Default Judgment Against City Club Apartments, LLP (D.I. No. 5).

         The parties filed three items with the Court on March 28, 2019. First, CCA had its attorney file a notice of appearance (D.I. No. 6). Second, PGMH requested a certified copy of the Default Judgment from the Prothonotary (D.I. No. 7). Third, CCA filed the Motion (D.I. No. 8).

         The Chancery Action

         CCA is a third party defendant in a pending Delaware Court of Chancery case (the "Chancery Action").[1]

         At one time, PGMH represented CCA in the Chancery Action. On October 16, 2018, PGMH moved to withdraw from its representation of CCA. The Chancery Court granted PGMH's request to withdraw on December 18, 2018. The Chancery Court gave CCA until January 17, 2019 to retain new counsel.

         CCA failed to meet the Chancery Court's January 17, 2019 deadline. On January 18, 2019, another party in the Chancery Action moved for a default judgment (the "Default Motion") against CCA because CCA had not satisfied the January 17, 2019 court-ordered deadline. This finally prompted action from CCA. On February 22, 2019, counsel entered an appearance on behalf of CCA. In addition, CCA filed a response to the Default Motion. CCA blamed its dilatory conduct in the Chancery Court Action on the fact that it was negotiating payment issues with PGMH and engaging in "appropriate due diligence and securing the necessary resources to secure new representation." The Chancery Court denied the Default Motion.

         CCA's counsel in the Chancery Action is not CCA's counsel in this civil proceeding. CCA has not provided any explanation why counsel in the Chancery Court Action could not appear in this civil proceeding.

         II. ...


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