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GAG Enterprises, Inc. v. Rayford

United States District Court, D. Columbia

November 24, 2015

GAG Enterprises, Inc., Plaintiff,
v.
Leonard Rayford, et al., Defendant

          For Gag Enterprises, Inc., Plaintiff: Kristina A. Caggiano, DUANE MORRIS, LLP, Washington, DC USA.

Page 231

         MEMORANDUM OPINION

         COLLEEN KOLLAR-KOTELLY, UNITED STATES DISTRICT JUDGE.

         Plaintiff GAG Enterprises, Inc. (" GEI" ) filed the Complaint in the above-captioned action on January 12, 2015 against Defendants Leonard Rayford and Jason Rayford, alleging a claim of breach of contract concerning a commercial property lease. See Compl., ECF No. [1]. Presently before the Court is Plaintiff's Motion for Default Judgment by the Clerk as to Jason Rayford. See ECF No. [13]. For the reasons stated below, the Court DENIES WITHOUT PREJUDICE Plaintiff's Motion for Default Judgment by the Clerk.

         I. BACKGROUND

         Plaintiff's Complaint sets out the following allegations, which the Court takes as true for purposes of Plaintiffs' Motion for Default Judgment. See Int'l Painters & Allied Trades Indus. Pension Fund v. R.W. Amrine Drywall Co., 239 F.Supp.2d 26, 30 (D.D.C. 2002).

         On or about July 1, 2007, Jerry Dale Leonard (" Leonard" ) entered into a lease agreement (the " Lease Agreement" ) with Ace Check Cashing, Inc., whereby he let certain commercial property in Warminster, Pennsylvania (the " Subject Property" ) to Ace Check Cashing, Inc. Compl. ¶ 7. The Lease Agreement was for a ten-year term, beginning on July 1, 2007 and ending on June 30, 2017. Lease Agreement, Exhibit A to Complaint, at 1. The lease was a triple net lease, which means that in addition to rent, Ace Checking Cashing, Inc. was responsible to pay net real estate taxes on the leased asset, net building insurance, and net common area maintenance. Compl. ¶ 9. Under the terms of

Page 232

the Lease Agreement, Ace Check Cashing, Inc. was primarily responsible for the payment of all rents, but the non-payment of rent was guaranteed by an affiliate of Ace Check Cashing, Inc., CW Financial of PA, LLC, and its principals, Defendants Leonard Rayford and Jason Rayford. Id. ¶ 9.

         On June 19, 2009, Leonard died, and his Estate sold the Subject Property to Plaintiff. Id. ¶ 12. The sale included all rights to the Lease Agreement and collection of rents. Id. Following the sale, rent was paid pursuant to the Lease Agreement through the payment due for February 2013. Id. ¶ 13. After that point, however, the business operating out of the Subject Property closed, and the rent payable as of March 2013, and each month thereafter, have not been paid. Id. The Lease Agreement provides, in pertinent part, that upon non-payment of the rents, or other events of default, the " rent for the entire unexpired term of the [Lease Agreement], as well as all other charges, payments and expenses" shall become immediately due. Id. ¶ 14. According to the Complaint, there is currently due and owing under the Lease Agreement the following sums:

o Rent for March, April, May, and June 2013 at $1350/month

$5,400.00

o Rent for July 2013 through June 2014 at $1390/month

$16,680.00

o Rent for July 2014 through June 2015 at $1430/month

$17,160.00

o Rent for July 2015 through June 2016 at $1470/month

$17,640.00

o Rent for July 2016 through June 2017 at $1510/month

$18,120.00

o Real Estate Taxes

$17,724.32

o Insurance

$8,000.00

o Water

$3,740.00

o Oil

$17,974.60

o Trash Removal

$4,800.00

o Fire Extinguisher

$700.00

o Electric

$13,930.00

Total: $141,768.92

Id. ¶ 15.

         On January 12, 2015, Plaintiff filed this action, alleging that Ace Check Cashing, Inc. has ceased business operations, and as a result, Defendants Jason Rayford and Leonard Rayford are obligated under the guarantee of the Lease Agreement to make payment. Id. ¶ 21. Plaintiff's Complaint demands judgment against Defendants Leonard Rayford and Jason Rayford jointly and severally in the amount of $141,768.92, plus attorneys' fees and costs, and such other and further relief as the Court deems just and proper. Id. at 5.

         Plaintiff has not filed an affidavit of service as to Leonard Rayford. Accordingly, the Court shall dismiss Plaintiff's claims against Leonard ...


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