The opinion of the court was delivered by: Hon. Dale S. Fischer United States District Judge
FINDINGS OF FACT AND CONCLUSIONS OF LAW
This matter was tried before this Court, sitting without a jury, on August 10, 2010. Michael A. Garabed of Reed Smith LLP appeared on behalf of Plaintiff VFS Financing, Inc. There was no appearance by any Defendant. The default of Defendant CHF Express, LLC ("CHF") had been entered on August 12, 2009. On Plaintiff's motion based on the unavailability of defense witnesses for cross-examination, the direct testimony of defense witnesses submitted by declaration was stricken.
Having heard the admissible evidence presented by the Plaintiff, and having considered the demeanor and credibility of the witnesses and all papers and exhibits presented by the Plaintiff for purposes of this trial, the Court makes the following findings of fact and conclusions of law pursuant to Rule 52 of the Federal Rules of Civil Procedure.
I. JURISDICTION AND VENUE
1. This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332 as the parties are citizens of different states and the amount in controversy exceeds $75,000.00, exclusive of interest and costs.
2. This Court has personal jurisdiction over each of the Defendants.
3. Venue is proper in this District pursuant to 28 U.S.C. § 1391(a) and (c) because a substantial part of the relevant events or omissions giving rise to the claims occurred in this District.
The Security Agreement And The Note
4. On or about December 29, 2006, Banc of America Leasing and Capital, LLC ("BALC"), as lender and secured party, and CHF, as borrower and debtor, entered into a Loan and Aircraft Security Agreement (the "Security Agreement").
5. Pursuant to the Security Agreement, BALC loaned CHF the sum of $7,150,000.00 for the purchase of an aircraft for use in CHF's business operations.
6. The loan is further evidenced by a Promissory Note (the "Note"), which requires repayment of the loan in installments and which is incorporated into and secured pursuant to the Security Agreement.
7. As security for the loan, the Security Agreement granted BALC a senior security interest in the aircraft purchased by CHF with the proceeds of the loan. This collateral consisted of: one (1) 1999 Citation, Model 560XL aircraft, Serial Number 560-5021, FAA Registration Number N862CE, powered by two (2) Pratt & Whitney PW545A aircraft engines, Model ALF502L-2C, Serial Numbers PCE-DB0042 and PCE-DB0040, together with one (1) Honeywell RE-100 auxiliary power unit bearing manufacturer's Serial Number P-515 and the ancillary equipment stated on the Security Agreement (collectively, the "Aircraft").
8. On or about December 29, 2006, Defendant Robert Fowler ("Fowler") executed and delivered to BALC a Guaranty (the "Fowler Guaranty") in which he guarantied the obligations of CHF under the Note.
9. On or about December 29, 2006, Defendant Ronald Hertel ("Hertel") executed and delivered to BALC a Guaranty (the "Hertel Guaranty") in which he ...