Travelers Casualty and Surety Company of America v. Kendall

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

Case No. 22-cv-23713-BLOOM/Otazo-Reyes

TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA,

Plaintiff,

v.

MITCHELL KENDALL, et al.,

Defendants.

________________________________/

ORDER ON MOTION FOR DEFAULT JUDGMENT

THIS CAUSE is before the Court upon Plaintiff Travelers Casualty and Surety Company

of America’s Motion for Final Default Judgment, ECF No. [67] (“Motion”). Defendant Robert

Vole (“Vole”) did not file a Response. The Court has reviewed the Motion, the record in this case,

the relevant case law, and is otherwise fully advised. For the reasons that follow, the Motion is

denied.

I. BACKGROUND

On November 11, 2022, Plaintiff initiated this declaratory action against Vole and twelve

co-Defendants for the purpose of determining whether Plaintiff has a duty to indemnify Mitchell

Kendall, Shayna Sirkin, Susan Shane, Elenore Cora Ross, Jack Loeb, Barney Rosenzweig, Gerald

Silver, Mark Sinnreich, Millinda Sinnreich, Ronald Shane, and Nicole Kendall (“Underlying

Defendants”) in a state court action captioned Robert Vole v. Susan Shane., et al., Case No. 2020-

003447-CA-01, brought by Vole. See ECF No. [1]. The Complaint clarifies that the Underlying

Defendants are members of Bayside Village Condominium Association, Inc. to which Plaintiff

issued a a WRAP+ Community Association Management Liability Coverage insurance policy,

Policy No. 049-LB-106729172 (“Policy”). On January 3, 2023, Plaintiff filed an Affidavit of

Service indicating that substitute service on Vole was effectuated on December 22, 2022,

triggering a January 12, 2023, response deadline. ECF No. [35]. Vole did not answer or otherwise

respond to the Complaint. Plaintiff moved for Clerk’s Entry of Default as to Vole on January 27,

2023. ECF No. [42]. On January 30, 2023, the Clerk entered a Default as to Vole. ECF No. [43].

Stipulations have been filed by Plaintiff and Defendants Mitchell Kendall, Shayna Sirkin, Susan

Shane, Elenore Cora Ross, Jack Loeb, Barney Rosenzweig, Gerald Silver, Mark Sinnreich,

Millinda Sinnreich, Ronald Shane, and Nicole Kendall that include an agreement to not contest

coverage and a joint stipulation for dismissal. See ECF Nos. [13], [18]-[23], [25], [27], [28], [36],

[62], and [66]. The remaining Defendant, Susan Silver, was voluntarily dismissed. ECF No. [46].

On May 26, 2023, Plaintiff filed the instant Motion seeking an entry of Final Default

Judgment against Vole. ECF No. [67]. Therein, Plaintiff requests that the Court enter a Final

Default Judgment against Vole and a declaration of no coverage under the Policy for the claims

made by Vole in an underlying lawsuit against the co-Defendants in this case (the “Underlying

Defendants”). Id. ¶ 12.

II. LEGAL STANDARD

Federal Rule of Civil Procedure 55(b)(2) authorizes a court to enter default judgment

against a defendant who fails to plead or otherwise defend. Fed. R. Civ. P. 55(b)(2). “[B]efore

entering a default judgment for damages, the district court must ensure that the well-pleaded

allegations in the complaint, which are taken as true due to the default, actually state a substantive

cause of action and that there is a substantive, sufficient basis in the pleadings for the particular

relief sought.” Tyco Fire & Sec., LLC v. Alcocer, 218 F. App’x 860, 863 (11th Cir. 2007) (emphasis

in original). “[A] default judgment cannot stand on a complaint that fails to state a claim.”

Chudasama v. Mazda Motor Corp., 123 F.3d 1353, 1370 n.41 (11th Cir. 1997) (citations omitted).

III. DISCUSSION

The allegations in Plaintiff’s Complaint, which are accepted as true as to Vole due to the

default, establish that Vole filed an underlying lawsuit against the Underlying Defendants, who

were members or former members of the Bayside Village Condominium Association. ECF No.

[1] ¶¶ 22, 24. Plaintiff issued the Policy to Bayside Village Condominium Association, Inc. for the

Policy Period of May 1, 2019, to May 31, 2020. Id. ¶ 31. The Complaint further alleges that in the

underlying state court litigation, Vole does not allege that any of the Underlying Defendants were

operating within their capacities as current or former Board members when the alleged conduct

occurred. Id. ¶ VI. As such, Plaintiff explains that because the Policy does not apply to the claims

asserted by Vole in the Underlying Lawsuit, the Court should find that Plaintiff has no duty to

indemnify the Underlying Defendants. Id. ¶ VIII. The Complaint, however, is totally devoid of

any allegations against Vole. See generally id.

“A federal court not only has the power but also the obligation at any time to inquire into

jurisdiction whenever the possibility that jurisdiction does not exist arises.” Fitzgerald v. Seaboard

Sys. R.R., Inc., 760 F.2d 1249, 1251 (11th Cir. 1985) (citations omitted). As such, a “district court

may act sua sponte to address the issue of subject matter jurisdiction at any time.” Herskowitz v.

Reid, 187 F. App’x 911, 912-13 (11th Cir. 2006). This is because federal courts are “empowered

to hear only those cases within the judicial power of the United States as defined by Article III of

the Constitution, and which have been entrusted to them by a jurisdictional grant authorized by

Congress.” Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d 405, 409 (11th Cir. 1999) (quoting Taylor

v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994)) (internal quotation marks omitted); see

Case No. 22-cv-23713-BLOOM/Otazo-Reyes

Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994) (“Federal courts are courts

of limited jurisdiction.”). “[O]nce a federal court determines that it is without subject matter

Jurisdiction, the court is powerless to continue.” Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d at

410 (alteration added).

Because there are no allegations against Vole in Plaintiffs Complaint, there is no case or

controversy between the remaining parties for the Court to adjudicate. See Bowen v. First Family

Fin. Services, Inc., 233 F.3d 1331, 1339 (11th Cir. 2000) (“Under Article III of the United States

Constitution, the subject matter jurisdiction of federal courts extends only to ‘cases or

controversies.’”) As such, the Court lacks subject matter jurisdiction and is powerless to grant the

requested relief.

IV. CONCLUSION

Accordingly, itis ORDERED AND ADJUDGED that Plaintiff's Motion for Final Default

Judgment, ECF No. [67], is DENIED. All other Defendants having been previously dismissed,

the Clerk of Court is directed to CLOSE this case. All deadlines and hearings are

TERMINATED, and any pending motions are DENIED AS MOOT.

DONE AND ORDERED in Chambers at Miami, Florida, on June 21, 2023.

UNITED STATES DISTRICT JUDGE

Copies to:

Counsel of Record