Koeva v. JOLLY

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF NEW YORK
_________________________________________
IN RE:
Chapter 7
LANFORD LEROY JOLLY, 	No. 25-10646-1-PGR
Debtor.
__________________________________________
STELA KOEVA
Plaintiff, 	Adv. Pr. No. 25-90021-1-pgr
v.
LANFORD LEROY JOLLY
Defendant.
__________________________________________
APPEARANCES:
LANFORD LEROY JOLLY 	PRO SE
SMELYANSKY LAW 	MAX SMELYANSKY, ESQ.
Attorney for Plaintiff
602 Central Avenue, Suite 102
Albany, NY 12206
Signed this 10 day of August, 2026.
Patrick G. Radel
_______________________________
United States Bankruptcy Judge
So Ordered.
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MEMORANDUM DECISION AND ORDER GRANTING DEFAULT
JUDGMENT
1. 	Lanford Leroy Jolly (“Debtor”) filed a Voluntary Petition under Chapter 7 of
the United States Bankruptcy Code (25-10646, Docket No. 1) pro se on June
6, 2025.
2. 	On September 15, 2025, Stela Koeva (“Plaintiff”) filed this Adversary
Proceeding against Debtor. (Docket No. 1).
3. 	In the Complaint, Plaintiff asserts one cause of action – that the debt owed by
Debtor, in an amount to be determined by a New York State Court, is
nondischargeable under 11 U.S.C. § 523(a)(2)(A). Id.
4. 	On December 4, 2025, Plaintiff requested a Clerk’s Entry of Default due to
Debtor’s failure to answer, appear, or otherwise defend the action. (Docket
No. 7).
5. 	The Clerk’s Entry of Default was entered on December 5, 2025. (Docket No.
8).
6. 	On April 1, 2026, Plaintiff moved for default judgment. (Docket No. 10). The
Debtor did not respond to the Motion.
7. 	The Court held a hearing and heard argument on Plaintiff’s Motion for
Default Judgment on June 18, 2026.1
1 At the June 18, 2026 hearing, this Court called together three other related adversary proceedings
concerning Lanford Leroy Jolly (25-90023-1-pgr) and Jacqueline Kamau Jolly (25-90022-1-pgr & 25-
90024-1-pgr). A Motion for Default Judgment was filed by Max Smelyansky, Esq. on behalf of each
Plaintiff(s) in each of the referenced adversary proceedings. The arguments the Jollys put forth at
the hearing and referenced herein pertain to each adversary proceeding.
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8. 	Max Smelyansky, Esq. appeared on behalf of the Plaintiff and Debtor
appeared pro se.
9. 	After the hearing, the matter was deemed submitted and the Court reserved
decision.
10. For the reasons outlined below, Plaintiff’s Motion for Default Judgment
(Docket No. 10) is granted.
Motion for Default Judgment
11. Federal Rule of Civil Procedure 55 is made applicable to adversary
proceedings by Federal Rule of Bankruptcy Procedure 7055.
12. “A plaintiff is not entitled to a default judgment and any concomitant
damages as a matter of right simply by virtue of a defendant’s procedural
default.” Could v. Marconi Dev. Grp., LLC, No. 19-1454, 2020 WL 2042332, at
*2 (N.D.N.Y. Apr. 28, 2020).
13. This Court must determine “whether the plaintiff’s allegations are sufficient
to establish the defendant’s liability as a matter of law.” Finkel v.
Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009).
14. Plaintiff seeks a determination that the debt owed by Debtor to Plaintiff is
nondischargeable pursuant to § 523(a)(2)(A) as the debt was obtained by false
pretenses, false presentations, or actual fraud. (Docket No. 1).
15. To sufficiently plead a claim under § 523(a)(2)(A), the Complaint must allege
that (1) the debtor made a false representation, (2) the debtor knew the
representation was false, (3) the debtor made the representation with the
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intent to deceive the creditor, (4) the creditor justifiably relied on the
representation, and (5) the creditor sustained loss or damages that was
proximately caused by the false representation. See Chase Bank, USA v.
Vanarthos (In re Vanarthos), 445 B.R. 257, 262 (Bankr. S.D.N.Y. 2011).
16. The Complaint sets forth the following facts: Lanford Jolly and Jacqueline
Jolly entered into a lease agreement with the Plaintiff on October 13, 2024.
During the application process, Lanford Jolly and Jacqueline Jolly failed to
disclose their rental history, including a prior eviction, and used a personal
email address to impersonate a prior landlord. The Plaintiff relied on the
fraudulent representations made in the rental application and rented the
premises to the Jollys. Upon the realization that the Jollys made false
representations the lease was terminated, and an action was commenced in
the Saratoga County Supreme Court.2 Plaintiff suffered damages such as
unpaid rent, costs, and fees.
17. At the hearing on Plaintiff’s motion for default judgment, Lanford Jolly and
Jacqueline Jolly proffered many arguments – that they filed a Motion to
Disqualify Counsel, which they believed constituted an answer to the
Complaint, that the Plaintiff’s delay in moving for default indicates a lack of
2 On March 17, 2025, the state court entered Summary Judgment in favor of Stela Koeva. (See
Docket No. 1 at 108-17). The court found that the false statements and omissions were material and
that Koeva reasonably relied on the misrepresentations. Id. In regard to damages, the court held a
trial on May 15, 2025 to determine damages. Id. The issuance of a money judgment was deferred due
to the Debtor’s bankruptcy filing. Id. at 119.
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prejudice, and that there are many issues and injustices involved in the
related state court actions. (Docket No. 20).
18. When asked why the Jollys did not file an answer after the order denying the
motion to disqualify counsel was entered, the Jollys stated they were waiting
for the Court and they were not properly informed regarding the adversary
proceeding. Id.
19. Jacqueline Jolly then requested the Court vacate the default and allow them
to respond to the Complaint. Id.
20. Pursuant to Federal Rule of Civil Procedure 55, as made applicable by
Federal Rule of Bankruptcy Procedure 7055, “[t]he court may set aside an
entry of default for good cause.”
21. In order to determine whether good cause exists, courts in the Second Circuit
look at the following factors: (1) the willfulness of default, (2) the existence of
any meritorious defenses, and (3) prejudice to the non-defaulting party.
Bricklayers & Allied Craftworkers Loc. 2, Albany, N.Y. Pension Fund v.
Moulton Masontry & Contru., LLC, 779 F.3d 182, 186 (2d Cir. 2015).
22. Willfulness refers to conduct that is more than merely negligent or careless
but is instead egregious and not satisfactorily explained. Id. at 187. For a
defendant to establish a meritorious defense, “the defendant must present
evidence of facts that, if proven at trial, would constitute a complete defense.”
Swarna v. Al-Awadi, 622 F.3d 123, 142 (2d Cir. 2010).
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23. Here, the Jollys did not articulate a sufficient meritorious defense. They
provided no evidence that, if proven at trial, would constitute a complete
defense. Id.
24. To the extent the Jollys argue there were issues in the state court action, this
Court is precluded from exercising appellate jurisdiction over final state court
judgments. See Rooker v. Fid. Tr. Co., 263 U.S. 413 (1923).
25. Additionally, a Motion to Disqualify does not constitute a proper response to
a complaint. See Burgess v. United States, 874 F.3d 1292, 1304 n.3 (11th Cir.
2017) (Carnes, J., concurring) (“Under the Federal Rule of Civil Procedure,
upon service of the complaint, the defendant is required either to file an
answer (Rule 12(a)(1)(A)), a motion to dismiss (Rule 12(b)), or a motion for a
more definite statement (Rule 12[e])).”). Moreover, the Motions to Disqualify
were only filed in related adversary proceedings 25-90023-1-pgr (Kashyap v.
Lanford Jolly) and 25-90022-1-pgr (Koeva v. Jacquline Jolly). The Court did
not deem the Motions to Disqualify Counsel as submitted in this adversary
proceeding, 25-90021-1-pgr, nor in 25-90024-1-pgr (Koeva v. Jaqueline Jolly).
26. Regardless of whether the Jollys filed a Motion to Disqualify Counsel in these
related adversary proceedings, an answer was due on November 24, 2025 and
was not filed. The Debtor also failed to move for an order to set aside the
default entered on December 5, 2025, and the Debtor failed to put forth a
sufficient reason why they never responded or otherwise sought an extension
of time. Therefore, this Court finds willfulness in the Debtor’s failure to
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answer the Complaint to this date. See Grp. One Ltd. V. GTE GmbH, 625 F.
Supp. 3d 23, 55 (E.D.N.Y. 2022) (“[W]here a defendant provides no
justification for the failure to respond or deliberately fails to respond to the
complaint, the defendant’s default may be considered egregious and not
satisfactorily explained.” (cleaned up)).
27. Lastly, given that nearly six months have passed between the entry of default
and the hearing on the Motion for Default Judgment, the Court finds that the
Plaintiff has been prejudiced. See Teamster Pension Fund of Phila. & Vicinity
v. Am. Helper, Inc., 2011 WL 479023, at *4 (D.N.J. Oct. 5, 2011) (finding that
the plaintiff was prejudiced when the defendant failed to contact the court or
defend the case and it was over six months since the defendant was served).
28. Thus, the Debtor has not demonstrated good cause to set aside the default,
and the Court finds Plaintiff’s allegations sufficient to sustain a
nondischargeability determination pursuant to § 523(a)(2)(A).
For the reasons stated above, Plaintiff’s Motion for Default Judgment is
GRANTED.
The Clerk of the Court is requested to transmit a copy of this Order to the
Debtor by first class mail, postage prepaid.
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