Jarvis v. Edie Ann Jarvis and Jarvis Financial Inc.
- Laura Provinzino
- 0:26-cv-01550
- U.S. District Court · District of Minnesota
- 9
In Minnesota Life Insurance Company v. Jarvis, Judge Provinzino granted default judgment against Edie Ann Jarvis for $78,069.84 in unpaid commissions but denied it against Jarvis Financial Inc. for lack of a contract.
Insurance brokers who work through a corporate entity may be personally liable under contracts they sign individually, even when the company is not separately bound. Insurers seeking to hold a broker's company liable for breach of contract must allege specific facts showing the individual had authority to bind the company — merely alleging the person 'does business as' the company is insufficient for a default judgment.
What happened
In Minnesota Life Insurance Company v. Edie Ann Jarvis and Jarvis Financial Inc., an insurance company sued a former broker and her company to recover $78,069.84 in commissions after it had to refund premiums on a life insurance policy. The policy was rescinded because structured cash flow financing — which Minnesota Life says it never would have approved — was used to pay the premiums, and neither defendant disclosed this. Neither defendant answered the lawsuit or appeared in court, leading Minnesota Life to seek a default judgment.
The court analyzed whether the undisputed facts supported a legitimate legal claim against each defendant separately. Against Edie Ann Jarvis individually, the claim was solid: she had personally signed two broker agreements requiring her to return commissions whenever Minnesota Life refunded premiums, Minnesota Life refunded the premiums, and Jarvis never returned the commissions. Against Jarvis Financial Inc., however, the court found a critical gap — the agreements were signed by Jarvis personally, and the complaint alleged only that Jarvis 'does business as' Jarvis Financial Inc., which is not enough under Minnesota law to show that Jarvis had authority to bind the company to those contracts. A breach-of-contract claim cannot succeed against a party who was not actually bound by the contract.
Judge Provinzino granted the motion for default judgment against Edie Ann Jarvis and entered judgment in the amount of $78,069.84, and denied the motion for default judgment against Jarvis Financial Inc. without prejudice. The court gave Minnesota Life 60 days to either voluntarily dismiss its claims against Jarvis Financial Inc. or take steps to continue pursuing them — such as filing an amended complaint — warning that inaction will result in those claims being dismissed for failure to prosecute.
The detailed version
- Jarvis v. Edie Ann Jarvis and Jarvis Financial Inc. · No. 0:26-cv-01550
- Laura M. Provinzino
- Sept. 2, 2026
Background
Minnesota Life Insurance Company brought this action against Edie Ann Jarvis, a former insurance broker, and Jarvis Financial Inc. (JFI), through which Jarvis worked. The court's subject-matter jurisdiction rested on diversity of citizenship: Minnesota Life alleged it is a citizen of Minnesota, while Jarvis and JFI are citizens of Florida, and the amount in controversy exceeds $75,000.
In January 2016, Jarvis personally executed a Fixed Annuity Product Broker Agreement appointing her as an agent of Minnesota Life to sell its insurance policies. That agreement required her to refund any commission she received in connection with a refunded customer payment. In March 2017, Jarvis personally executed a Broker Sales Contract appointing her as a sales broker, which similarly required her to return all earnings credited to her on any refunded premiums. Both contracts contained Minnesota choice-of-law clauses. JFI did not sign either agreement.
In 2019, a policyholder demanded rescission of a life insurance policy Jarvis had issued through JFI. Minnesota Life investigated and discovered that structured cash flow financing — which it says it would never have approved — had been used to fund the policy's premiums, and that neither Jarvis nor JFI had disclosed this. Minnesota Life rescinded the policy and refunded the premiums. It then sought repayment of $78,077.32 in commissions credited to Jarvis and JFI.
After a demand letter sent December 2, 2025 went unmet, Minnesota Life filed this suit on February 20, 2026, asserting three claims: (1) breach of contract; (2) unjust enrichment; and (3) promissory estoppel. Both defendants were personally served on March 26, 2026, but neither answered or appeared. The Clerk of Court entered default against both defendants on May 19, 2026. Certified mail serving the entry of default was returned as "refused" and "unable to forward." Minnesota Life moved for default judgment on June 23, 2026.
Legal Standard for Default Judgment
The court noted that default judgments are disfavored and should be rare, given the judicial preference for decisions on the merits. Nevertheless, Rule 55 of the Federal Rules of Civil Procedure permits default judgment when a defendant fails to respond or otherwise defend. The court applied a three-step analysis: (1) whether the defendant is in default; (2) whether the unchallenged facts establish a legitimate cause of action; and (3) whether damages are sufficiently proven.
Step 1: Default Status
Both Jarvis and JFI were plainly in default — they were served, never answered, and never appeared. The Clerk's entry of default had already been entered. The court found this step satisfied as to both defendants.
Step 2: Legitimate Cause of Action
Because Minnesota Life's motion focused on its breach-of-contract claims, the court likewise focused there. Under Minnesota law, a breach-of-contract claim requires: (1) formation of a contract; (2) plaintiff's performance of any conditions precedent; (3) a material breach by the defendant; and (4) damages.
As to Jarvis
The court found all four elements met. Jarvis personally signed both agreements; Minnesota Life alleged it performed all conditions precedent; Jarvis failed to return commissions after Minnesota Life refunded the premiums as the agreements required; and Minnesota Life suffered economic harm. The court held the unchallenged facts established a legitimate breach-of-contract cause of action against Jarvis.
As to JFI
The court denied default judgment. The fatal problem was contract formation. Both agreements were signed by Jarvis individually; there was no indication she signed on behalf of JFI or had authority to bind JFI. Under Minnesota law, a contract does not automatically bind a corporation just because a corporate officer signs it — the officer must have authority to bind the corporation. The complaint's only JFI-specific allegation was that Jarvis "does business as" JFI, which the court found far short of alleging binding authority. Because breach-of-contract claims against nonparties to a contract fail as a matter of law, the court denied the motion for default judgment against JFI.
Step 3: Damages (Against Jarvis Only)
Minnesota Life submitted a declaration from Sara Kaufman, described as Second Vice President and Chief Financial Officer for Individual Solutions at Minnesota Life, who attested to familiarity with broker records and Jarvis's outstanding balance. After accounting for subsequent earned commissions that offset Jarvis's obligations, Kaufman calculated the remaining balance at $78,069.84 — $7.48 less than the amount pleaded in the complaint. The court found this amount readily discernible from undisputed record evidence and noted it does not exceed the amount demanded in the pleadings, as required by Federal Rule of Civil Procedure 54(c).
Disposition Regarding JFI
Rather than leaving JFI's status unresolved, the court gave Minnesota Life 60 days to either: (1) voluntarily dismiss its claims against JFI; or (2) take affirmative steps to prosecute those claims (such as filing an amended complaint, a second motion for default judgment, or similar action). Failure to act within 60 days will result in dismissal of all claims against JFI for failure to prosecute under Federal Rule of Civil Procedure 41(b).
Order
- Minnesota Life's motion for default judgment (ECF No. 10) is granted as against Edie Ann Jarvis.
- Minnesota Life's motion for default judgment (ECF No. 10) is denied without prejudice as against Jarvis Financial Inc.
- Judgment is entered against Jarvis, and in favor of Minnesota Life, in the amount of $78,069.84.
The court noted that Minnesota Life may separately seek attorneys' fees, costs, and prejudgment interest through the processes set out in the Federal and Local Rules.
Read the full 9-page opinion on CourtListener, the free public archive maintained by the Free Law Project.