Motion for Child Support in Colonial Funding Network, Inc. as servicing provider for LIFE CAPITAL, INC. v. Adao Global, Llc d/b/a ADAO GLOBAL, David G. Arnold (A/K/A DAVID GENE ARNOLD)| Trellis.Law

On February 20, 2017 a Motion-Secondary was filed involving a dispute between Colonial Funding Network, Inc. As Servicing Provider For Life Capital, Inc., and Adao Global, Llc D B A Adao Global, David G. Arnold, for Commercial - Contract in the District Court of New York County.

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FILED: NEW YORK COUNTY CLERK 03/01/2018 03:57 PM INDEX NO. 650868/2017
NYSCEF DOC. NO. 32 RECEIVED NYSCEF: 03/01/2018

SUPREME COURT OF THE STATE OF NEW YORK
Index No.: 650868/2017
COUNTY OF NEW YORK
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COLONIAL FUNDING NETWORK, INC. as servicing
provider for LIFE CAPITAL, INC.,

Plaintiff,

- against-

ADAO GLOBAL, LLC d/b/a
ADAO GLOBAL and
DAVID G. ARNOLD (A/K/A DAVID GENE ARNOLD),

Defendants.
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PLAINTIFF'S MEMORANDUM OF LAW IN SUPPORT
OF PLAINTIFF'S MOTION FOR ENTRY OF DEFAULT JUDGMENTS

Nikolaos D. Athanasopoulos, Esq.

Attorney for Plaintiff
45th 6ti'
120 West Street, Floor
New York, New York 10036
Tel: (212) 354-1400
Fax: (800) 581-3615

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SUPREME COURT OF THE STATE OF NEW YORK
Index No.: 650868/2017
COUNTY OF NEW YORK
------------------------------------------------------------------x MEMORANDUM OF
COLONIAL FUNDING NETWORK, INC. as servicing LAW IN SUPPORT OF
provider for LIFE CAPITAL, INC., MOTION ENTRY
FOR
OF DEFAULT
Plaintiff, JUDGMENTS

- against-

ADAO GLOBAL, LLC d/b/a
ADAO GLOBAL and
DAVID G. ARNOLD (A/K/A DAVID GENE ARNOLD),

Defendants.
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("Colonial" "Plaintiff'
Plaintiff, Colonial Funding Network, Inc. or "Plaintiff"),as servicing provider for

("
Life Capital, Inc. ("Life Capital, Inc."), respectfully submits thismemorandum of law in support of its

motion for entry of an order directing the Clerk of the Court to enter default judgments against

Global"
Defendants ADAO Global, LLC d/b/a ADAO Global ("ADAO Global") and David G. Arnold a/k/a

("Arnold," "Defendants"
David Gene Arnold together with ADAO Global, "Defendants") for failure to appear in this

action pursuant to CPLR §3215(a).

PRELIMINARY STATEMENT

Based upon the record of this case, entry of a default judgment isauthorized and appropriate in

Defendants'
accordance with CPLR§3215(a) due to the failureto appear despite being served on

numerous occasions in accordance with the requirements of the CPLR.

Rather than to submit a motion forentry of default to the Office of the Clerk, however, Plaintiff is

Clerks'
respectfully requesting that the Court direct entry ofjudgment due tothe Default Judgment

previous denials of entry in cases where Colonial instituted litigationas the servicing provider for various

funders. As detailed herein, the Default Judgment Clerks have erroneously rejected previous applications

for default noting in many cases as the basis for their reason: "At the direction of the County Clerk, the

provider"
Hon. Milton A. Tingling, the clerk cannot enterjudgment where the plaintiff isthe "servicing

lender."
and not the actual

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As the administrative agent of Life Capital, Inc. under the Agreements (defined herein) executed

and approved by the Defendants, Colonial has broad agency authority to commence litigationon behalf of

Life Capital, Inc. Moreover, pursuant to CPLR§l004, an agent such as Colonial, ispermitted to sue on

behalf of itsprincipal. Likewise, Courts generally uphold an agent's capacity to sue on behalf of the

principal when the agreement reflects the arrangement as in the instant case. Airlines Reporting Corp. v.

S & N Travel, Inc.,238 A.D.2d 292, 293 (2d Dept. 1997). As a result,entry of default judgments against

Defendants are warranted in thiscase and should be ordered by the Court.

FACTUAL BACKGROUND

For a detailed recitation of the facts,the Court isrespectfully referred to the Affidavit of David

"Affidavit" "Affirmation"
Wolfson (the "Affidavit"), the Attorney Affirmation ofNikolaos D. Athanasopoulos (the "Affirmation"),

and the accompanying exhibits thereto filed contemporaneously herewith and incorporated by reference

herein in full.

The record isclear that Defendants were properly served in thisaction and failedto appear or

otherwise respond warranting entry of default judgments against Defendants in accordance with

CPLR§3215(a). Specifically, the Affirmation and itsexhibits establish thatthe Defendants were served,

pursuant to the CPLR, by licensed process servers and theaffidavits of service upon Defendants were

timely filed. Defendants were also served an additional copy of the Summons and Verified Complaint to

Notice"
comply with the "Additional requirement set forth by CPLR §§3215(g)(3)(4) as further noted in

the Affirmation. As such, there isno question that Defendants were aware they were being sued and they

were obligated to respond within the time prescribed by law as indicated on the Summons.

As of the date of thisMemorandum and Motion for Entry of Default Judgments, Defendants

neither have responded nor appeared, nor have they requested an extension of time to respond. Rather,

they are in default of this action. Therefore, as detailed in the Affidavit, Plaintiff isentitled to judgments

of default against Defendants in the amount of $101,286.00, jointly and severally, in addition to any other

amounts the Court deems appropriate.

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Accordingly, Plaintiff isseeking an order from the Court directing entry of default given that the

Default Judgment Clerks previously refused to enter judgment in substantially similar cases citing, in sum

provider"
and substance, that the clerk cannot enter judgment where the plaintiff isthe "servicing and not

the actual lender.

As set forth herein, the sixth page of the Agreements clearly statethat "Colonial Funding

Network, Inc. isthe Authorized servicing agent for the Funder for this contract providing administrative,

Merchant."
bookkeeping, reporting and support services for the Funder and the Further, the Agreements

are signed by the Defendants acknowledging their agreement that Colonial has authority to act as

servicing agent on behalf of Life Capital, Inc. Thus, the Agreements grant Plaintiffwith the broad ability

to act as agent of Life Capital, Inc.,including commencing legal action against Defendants for breach of

the contract and entry of default judgments are warranted in thisaction.

ARGUMENT

Plaintiff is Entitled to Judgments by Default

Under CPLR §3215(a), ifa Defendant failsto appear or plead, a plaintiff may obtain default

judgment. In this case, allDefendants were lawfully served and supplemental service of the action was

also provided in accordance with CPLR §3215(g). Nevertheless, Defendants have not responded to this

litigationand are in default.

To obtain a default judgment in New York, CPLR §3215 requires plaintiffto submit proof of

service of the Summons and Complaint, proof of the facts constituting the claim and proof of a

Defendant's default. CPLR §3215; see also Raizel Fried et al.,v.Jacob Holding, Inc., 970 N.Y.S.2d 260,

263. (N.Y.S.2d 2013). CPLR §3215 also requires an Affirmation of mailing of an additional copy of the

Summons and Complaint to both individual and corporate Defendants at least20 days before entry of

judgment. Further, New York military law requires the submission of an Affidavit of Non-Military Status

for individual Defendants.

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In the case at hand, Plaintiff submitted the requisite proof to obtain the default judgments. To

start,Plaintiffprovided evidence of lawful service on Defendants by a licensed process server. Affidavits

of service made by a process server are considered prima facie evidence of proper service under CPLR

§308 and are entitled to a presumption of regularity. See Beneficial Homeowner Service Corporation v.

Poucher Girault, 875 N.Y.S.2d 815, 816 (N.Y.S.2d 2009).

Plaintiffalso provided proof of itsclaims via the Verified Complaint, the Affidavit of David

Wolfson, and the exhibits annexed thereto. As noted in IMG International Marketing Group, Inc.v. SDS

William Street, LLC, 936 N.Y.S.2d 59 (N.Y.S.Ct. 2011), when a Defendant defaults, allof the factual

allegations, and reasonable inferences to be drawn therefrom, are considered admitted as they relateto

liability.In addition, the standard of proof only requires firsthand confirmation of facts. Id. at 59. Thus,

Plaintiff has met itsburden of proving the facts in support of itsclaims.

Lastly, Plaintiffhas sworn that to itsknowledge, and as confirmed by the Department of Defense

Manpower Data Center, Defendant Arnold isnot in the military. Plaintiff has provided an affidavit to this

effect as well as a certification of the Defendant's non-military status issued by the Department of

Defense Manpower Data Center.

Itis respectfully submitted that although Plaintiff is entitledto entry of default against

Defendants, the Default Judgment Clerks previously denied substantially similar applications for default

based upon erroneous findings such as: "At the direction of the County Clerk, the Hon. Milton A.

Provider"
Tingling, the clerk cannot enterjudgment where the plaintiff isthe "servicing and not the actual

lender."
Examples of certain of these denials are attached to the Affirmation ofNikolaos D.

"H."
Athanasopoulos as Exhibit

Likewise, when denying entry of a default judgment, CFN was notified by the Default Judgment

Clerk that:

"You will need to filea motion to the court to obtain an order directing the clerk to enter
Judgment. The agreement isonly between Business Union Financial and the Merchant.
Colonial Funding Network as Servicing Agent is not a party in the agreement. The
merchant isnot liableto Colonial Funding Network as Servicing Agent. The funder did
not sign the agreement. The clerk does not have the authority to apply case law. Case

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law can only be applied by the Judge. The clerk can only apply statutory law toeach
application. Once an order ise-filed you can use the link under the document type for
macorket@nycourts.gov"
document #5 to upload the proposed Judgment. Thank you.

However, as stated previously, the Agreements specifically provide that Colonial isthe

authorized servicing agent for Life Capital, Inc. with broad agency authority to act on Life Capital, Inc.'s

to,"
behalf "including but not limited the activities stated. As such, there isunequivocally privity

between the parties in this action, and Colonial has capacity to bring this legal action against Defendants

for breach of the Agreements.

Further, CPLR§1004 permits an agent, such as Colonial, to institutelitigation on behalf of its

principal. Where an agent is a person with whom or in whose name a contract has been made isacting for

the benefit of another party or principal, they may be recognized as a real party in interest.The courts

have held that as long as the agent possesses a general agency as authorizing thatagent to act in all

matters affecting the contract for and on behalf of the principal, they have sufficient standing. Watts v.

Phillips-Jones Corp., 211 A.D. 523 (2d Dept. 1925). Courts also generally will uphold an agent's

capacity to sue on behalf of the principal when the agreement reflects this arrangement. Airlines

Reporting Corp. v. S&N Travel, Inc., 238 A.D.2d 292, 293 (2d Dept. 1997).

In the instant matter, Defendants acknowledged that Colonial possessed a general agency

authorizing itto act on behalf of Life Capital, Inc. for a multitude of services including, but not limited to

collection efforts. As a result,Colonial is a proper party to this Action with the capacity to bring the

causes of action alleged therein.

CONCLUSION

For the reasons and causes of action contained herein and in the Verified Complaint as well as the

various affidavits and Affirmation submitted herewith, Plaintiffrespectfully requests the following:

l. The entry of an order directing the Clerk of the Court to enter judgment by default in favor of
Plaintiff against Defendant, ADAO Global, LLC d/b/a ADAO Global in the amount of
$101,286.00 plus costs and interestfrom December 5, 201 6,the date of default, through entry
of judgment herein;

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2. The entry of an order directing the Clerk of the Court to enterjudgment by default in favor of
Plaintiff against Defendant, David G. Arnold a/k/a David Gene Arnold in the amount of
$101,286.00 plus costs and interestfrom December 5, 2016, the date of default,through entry
ofjudgment herein; and

3. Such other and further relief as the Court may deem just and proper.

Dated: March L. 2018

Respectfully submitted,

Nikolaos D. Athanasopoulos, Esq.

By: /s/Nikolaos D. Athanasopoulos
Nikolaos D. Athanasopoulos, Esq.
Attorneys for Plaintiff
45d' 6d2
120 West Street, Floor
New York, New York 10036
Tel: (212) 354-1400
Fax: (646) 365-8119

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Case Info

Judge

Arthur Engoron Track Judge’s New Case

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Document Filed Date

March 01, 2018

Case Filing Date

February 20, 2017

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Motion-Secondary: Colonial Funding Network, Inc. as servicing provider for LIFE CAPITAL, INC. v. Adao Global, Llc d/b/a ADAO GLOBAL, David G. Arnold (A/K/A DAVID GENE ARNOLD)

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