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Underwood & Wong, Inc. v. Enriquez

July 20, 2010



Plaintiff's motion for entry of default judgment came on regularly for hearing on July 15, 2010. Marion Quesenbery appeared for plaintiff. No appearance was made for defendant Ricardo Enriquez. Upon review of the motion and the supporting documents, upon hearing the arguments of counsel and good cause appearing therefor, the court recommended entry of default judgment in open court. Therefore, THE COURT MAKES THE FOLLOWING FINDINGS AND RECOMMENDATIONS:

Plaintiff Underwood & Wong, Inc., is a California corporation with its principal place of business in Los Angeles, CA. Plaintiff sues Ricardo Enriquez for money due for shipments of perishable agricultural commodities made to defendant between July 23, 2008 and September 12, 2008. The complaint contains claims for violations of the Perishable Agricultural Commodities Act ("PACA"), 7 U.S.C. § 499e(c)(5), breach of fiduciary duty by a PACA trust trustee, and state claims of breach of contract and unjust enrichment.

Defendant Enriquez is an individual doing business as Sacramento Valley Produce in Sacramento, CA.

Plaintiff seeks recovery in excess of $10,000.00.

Jurisdiction is proper under 28 U.S.C. § 1331. Venue is proper in this district because defendant is located within the division of this district.

Plaintiff asserts that defendant is a United States Department of Agriculture ("USDA") licensed dealer of perishable agricultural commodities in interstate and/or foreign commerce and is subject to PACA. (See Quesenbery Decl., ¶ 4 and Ex. A.)

Plaintiff submits that it entered into contracts of sale with defendant from July 23, 2008 through September 12, 2008 for the purchase and sale of agricultural commodities. (Quesenbery Decl., Ex. A, Parts 1 and 2; Underwood Decl., ¶¶ 6, 8.) Pursuant to those contracts, plaintiff sold and shipped fresh fruit and vegetables to defendant in Sacramento, CA, for which defendant agreed to pay plaintiff $20,000.00. Payment was due within ten days of delivery of the merchandise. Although defendant received and accepted the produce listed on plaintiff's invoices, defendant has only paid plaintiff $10,000.00 of the total sum due. (Underwood Decl., ¶¶ 6, 8, 9, 12, and 13.)

Plaintiff maintains that it is licensed by the USDA as a commission merchant, dealer and/or broker of perishable agricultural commodities. (Quesenbery Decl. ¶ 5.) Pursuant to 7 U.S.C. § 499e(c)(4), plaintiff printed on the face of the invoices that it gave to defendant the following statutory language:

The perishable agricultural commodities listed on this invoice are sold subject to the statutory trust authorized by section 5(c) of the Perishable Agricultural Commodities Act, 1930 (7 U.S.C. §499e(c)). The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities and any receivables or proceeds from the sale of these commodities until full payment is received. (See Quesenbery Decl., Ex. A, Parts 1 and 2.)

Plaintiff maintains that it performed all of its obligations and duties under the contracts. Under the terms of those contracts, in the event an account is not paid when due, it is subject to a 1-1/2% monthly delinquent charge (18% per year) and attorneys' fees and other costs of collection. (Underwood Decl., ¶¶ 8, 12, and Ex. A.)

Plaintiff seeks actual damages in the amount of $10,000.00, the sums remaining due on the contracts. Plaintiff avers that defendant paid only $10,000.00 of the $20,000.00 due. Plaintiff also seeks interest on the debt owed in the amount of $4,320.96 through July 1, 2010 and .049% per day thereafter on the outstanding debt until paid in full. (Quesenbery Decl., ¶ 10 and Ex. D.)

Pursuant to the express language of the contracts, the prevailing party is entitled to an award of attorneys fees, costs and expenses arising out of litigation. Plaintiff seeks attorneys fees and costs in the total amount of $4,537.00. (Quesenbery Decl., ¶¶ 7-9 and Ex. C.)

I. Request for Default Judgment

The complaint in this matter was served upon defendant by mail on June 24, 2009. Pacific Atlantic Trading Co. v. M/V Main Express, 758 F.2d 1325, 1331 (9th Cir. 1985) (default judgment void without personal jurisdiction). Defendant has not filed an answer. The clerk of the court entered default against defendant on September 2, 2009. Notice of the entry of default as well as plaintiff's motion for entry of default judgment were served by mail on ...

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