A recent decision from the Arkansas Court of Appeals demonstrates the importance of answering a lawsuit.
The appellate court denied the request from Ascentium Capital LLC of Kingwood, Texas, to throw out a default judgment against it for $600,185.
Back in 2018, James Marshall of Pulaski County and Your Furniture Store sued Ascentium Capital in Pulaski County Circuit Court over allegations that one of its agents forged Marshall’s signature to defraud him. (The agent, Corey Bolton of Pulaski County, was also sued, but a judge dismissed him from the case after finding that he had not been served. Bolton could not be reached for comment.)
Ascentium Capital, which leased a credit card machine to Marshall, didn’t respond to the lawsuit within 30 days, which resulted in a default judgment.
At a hearing for damages, Marshall testified that he had lost about $7,000 a month for about two years because he wasn’t able to accept credit cards, court records showed.
Pulaski County Circuit Judge Mary McGowan ruled that Marshall should receive $150,000 in compensatory damages and $450,000 in punitive damages, plus $185 in court costs.
Ascentium Capital later appealed the decision and argued that Marshall failed to allege facts to support a claim and the judgment wasn’t supported by the evidence.
“Put simply, allowing the Default Judgment and the damages award to stand without any supporting evidence would constitute a grave miscarriage of justice,” the Ascentium Capital filing said.
Ascentium Capital also wanted the judgment thrown out because it said it was never told about the hearing for damages. It also raised other objections about the judgment.
The Arkansas Court of Appeals found otherwise. Chief Judge Brandon J. Harrison wrote the opinion and Judges Robert J. Gladwin and Wendy Scholtens Wood agreed.
“We hold that Ascentium had no right to notice of the hearing, nor did Marshall or his counsel have an equitable obligation to inform it of the hearing,” Harrison wrote in the opinion. “Ascentium did not make an appearance in the case; therefore, it was not entitled to notice.”
Ascentium Capital’s attorney, Blair Evans of Baker Donelson Bearman Caldwell & Berkowitz of Memphis, declined to comment because the case was pending.
Attorneys for the plaintiffs were Chuck Gibson of Dermott and James Swindoll of Little Rock.
