Huntington National Bank v. Very Creative Advertising & Marketing LLC

Background

Huntington National Bank, successor by merger to TCF National Bank, sued Very Creative Advertising & Marketing LLC and Terrance Fletcher. TCF had financed Very Creative’s purchase of software and equipment under an installment payment agreement. Very Creative borrowed $317,411.27 and agreed to make monthly payments of $6,208.66 for 60 months. The agreement allowed the bank, after a default, to accelerate the unpaid balance, charge specified interest and fees, use remedies available to a secured creditor under Minnesota’s Uniform Commercial Code, and recover enforcement expenses, including attorney’s fees.

Fletcher provided a continuing guaranty covering Very Creative’s obligations under the installment agreement, including payments and enforcement costs. The bank notified the defendants of a missed payment and later accelerated the loan and demanded $255,170.54, along with attorney’s fees and costs. The defendants made no further payment.

Failure to Respond and Default Judgment

The defendants were served with the summons and complaint but did not answer or otherwise respond. The Clerk entered default against both defendants. The court decided the bank’s motion for default judgment on the written submissions without a hearing. For purposes of liability, the court treated the complaint’s factual allegations as true, but it separately required evidence supporting the amount of damages.

Court’s Analysis

The court concluded that the installment agreement was a valid contract and that Very Creative materially breached it by failing to make timely payments. The court also concluded that the guaranty was a valid contract and that Fletcher materially breached his obligation to pay amounts owed under it. The court found that the bank’s evidence established its damages with reasonable certainty.

The court accepted $262,947.20 in actual damages under the installment agreement and guaranty. That amount included missed installments, the present value of the remaining accelerated installments, a penalty, a returned-payment fee, and late fees. The court also found that Huntington reasonably incurred $5,818.15 in attorney’s fees and costs in pursuing its remedies.

Order

The court granted Huntington’s Motion for Default Judgment. It directed the Clerk to enter judgment in favor of Huntington against Very Creative and Fletcher, jointly and severally, for $268,765.35, plus any applicable post-judgment interest allowed by law. The opinion states that the judgment amount consists of the actual damages and attorney’s fees and costs.