Judge Anne Hwang, Case Number: 23STCV01680, Date: 2024-09-06 Tentative Ruling

PLEASE NOTE: Parties are encouraged to meet and confer concerning this tentative ruling to determine if a resolution may be reached. If the parties are unable to reach a resolution and a party intends to submit on this tentative ruling, the party must send an email to the Court at sscdept32@lacourt.org indicating that party’s intention to submit. The email shall include the case number, date and time of the hearing, counsel’s contact information (if applicable), and the identity of the party submitting on this tentative ruling. If the Court does not receive an email indicating the parties are submitting on this tentative ruling and there are no appearances at the hearing, the Court may place the motion off calendar or adopt the tentative ruling as the order of the Court. If all parties do not submit on this tentative ruling, they should arrange to appear in-person or remotely. Further, after the Court has posted/issued a tentative ruling, the Court has the inherent authority to prohibit the withdrawal of the subject motion and adopt the tentative ruling as the order of the Court.

On January 26, 2023, Plaintiff Sharan Trana Jones (“Plaintiff”) filed a complaint against Defendants Christina Palacios and Alma Rosa Palacios (“Defendants”) for negligence based on a motor vehicle accident.

On November 21, 2023, default was entered against Defendants. Default judgment has not been granted.

Defendants now move to vacate the entry of default under Code of Civil Procedure section 473(b). Plaintiff opposes. No reply has been filed.

Code of Civil Procedure section 473(b) provides for discretionary and mandatory relief from a default taken against a party due to mistake, inadvertence, surprise, or neglect. A motion pursuant to this section must be filed no more than six months after entry of the order from which relief is sought, and must contain an affidavit of fault demonstrating the moving party’s mistake, inadvertence, surprise, or neglect.

“The six-month time limit for granting statutory relief [under section 473(b)] is jurisdictional and the court may not consider a motion for relief made after that period has elapsed.” (Manson, Iver & York v. Black (2009) 176 Cal.App.4th 36, 42.) “The six-month period runs from entry of default, not entry of judgment.” (Id. [citing Weiss v. Blumencranc (1976) 61 Cal.App.3d 536, 541].) However, under the mandatory provision of section 473(b) for attorney fault, the six-month time limit runs after entry of judgment. (Sugasawara v. Newland¿(1994) 27 Cal.App.4th 294, 297.) If a motion based on attorney fault is timely, section 473(b) also requires the court to vacate the underlying default entered by the clerk. (Id. at 295.)

Under the mandatory provision of section 473(b), the Court shall vacate default and default judgment “unless the court finds that the default or dismissal was not in fact caused by the attorney’s mistake, inadvertence, surprise, or neglect.” (Code Civ. Proc. § 473(b) [italics added].) “[F]or mandatory relief to apply the court must also satisfy itself that the default (i.e., the failure to respond) was in fact caused by attorney mistake or neglect.” (Cisneros v. Vueve (1995) 37 Cal.App.4th 906, 911 [emphasis in original].) Where the attorney did not represent defendant “at the time the default was entered, […] as a matter of law, […the attorney] was not the proximate cause of the entry of default as defined in the ‘unless clause.’ Hence, […] defendants were not entitled to relief under the attorney affidavit provisions of section 473.” (Id. at 912 [alterations added].) However, the attorney need not be the party’s attorney of record at the time of the entry of default, but rather “the statute only requires the affidavit be executed by an attorney who represents the client and whose mistake, inadvertence, surprise, or neglect in fact caused the client’s default or dismissal.” (SJP Limited Partnership v. City of Los Angeles (2006) 136 Cal.App.4th 511, 517.)

Additionally, under the mandatory provision, there is no requirement that the attorney’s mistake or inadvertence be excusable. (Vaccaro v. Kaiman (1998) 63 Cal.App.4th 761, 770.) The affidavit also does not need to contain a reason for the mistake. (Martin Potts & Associates, Inc. v. Corsair, LLC (2016) 244 Cal.App.4th 432, 438.)

There is a split among the appellate courts as to whether a default is in fact caused by the attorney’s mistake, inadvertence, surprise, or neglect if the client is also at some fault. “Some appellate cases, based on the ‘not in fact caused by the attorney’s mistake, inadvertence, surprise or neglect’ clause in the mandatory relief provision of section 473, have restricted the statute only to cases where the party against whom the judgment is taken is ‘totally innocent of any wrongdoing and the attorney was the sole cause of the default or dismissal.’” (Gutierrez v. G&M Oil Company, Inc. (2010) 184 Cal.App.4th 551, 557-58 [citing Lang v. Hochman (2000) 77 Cal.App.4th 1225, 1248] [emphasis in original].) “By contrast, other Court of Appeal decisions have indicated that the provision is available to clients who may be at some fault in allowing the dismissal or default, just as long as the client is not guilty of intentional misconduct in contributing to the adverse result. (Id. at 558 [citing SJP Limited Partnership, supra, 136 Cal.App.4th at 520 and Benedict v. Danner Press (2001) 87 Cal.App.4th 923, 932]; see also Martin Potts and Associates, Inc. v. Corsair, LLC (2016) 244 Cal.App.4th 432, 442 [collecting cases].)

In Benedict, the court reasoned that “[o]n its face, section 473, subdivision (b), does not preclude relief under the mandatory provision when default is entered as a result of a combination of attorney and client fault.” (Benedict, supra, 87 Cal.App.4th at 928-29.) The court further noted that the cases requiring that a client be “totally innocent of any wrongdoing” involve “intentional misconduct by the clients.” (Id. at 930.) The court further distinguished cases such as Cisneros, which did not involve a default “caused by the mistaken or neglectful conduct of both the attorney and the client.” (Id. at 931 [distinguishing Cisneros, supra, 37 Cal.App.4th at 911] [emphasis in original].)[1]

“Because the law favors disposing of cases on their merits, ‘any doubts in applying section 473 must be resolved in favor of the party seeking relief from default [citations]….” (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 980 [citations omitted].) “Section 473 is often applied liberally where the party in default moves promptly to seek relief, and the party opposing the motion will not suffer prejudice if relief is granted. [Citations omitted.] In such situations, ‘very slight evidence will be required to justify a court in setting aside the default.’” (Elston v. City of Turlock (1985) 38 Cal.3d 227, 233 [citations omitted] [superseded by statute on other grounds].)

As an initial matter, here, default was entered on November 21, 2023. Since this motion was filed on June 6, 2024, it is untimely under the discretionary provision of section 473(b). The Court assumes without deciding that the motion is timely under the mandatory provision. (See Code Civ. Proc., § 473, subd. (b) [requiring court to vacate entry of default “whenever an application for relief is made no more than six months after entry of judgment”]; Sugasawara, supra, 27 Cal.App.4th at 297.)[2]

According to the Declaration of Christian E. Urbano, Defendant’s counsel, Defendants’ insurer is Loya Casualty Insurance Company (“Loya”), which retains the firm Martinez, Dieterich & Zarcone Legal Group (“MDZ”) to handle litigation matters for Loya insureds. “Once a Complaint is filed against a Loya insured in California, Martinez, Dieterich & Zarcone Legal Group represents the respective defendant and is responsible for monitoring the Court docket and contacting the respective defendant to determine whether and when Defendant was properly served with a Complaint as a result of the automobile accident.” (Urbano Decl. ¶ 4.)

Defendants’ counsel has been employed as an attorney with the firm representing Defendants since November 14, 2023. (Urbano Decl. ¶ 2.) On January 26, 2023, the complaint for this case was filed. (Urbano Decl. ¶ 3.) Counsel declares that between February 2022 and mid-November 2023, over 50% of attorneys and staff left MDZ which caused confusion over who was responsible for which files. (Id. ¶ 5.) Defendant Alma Rosa Palacios was served the complaint on July 11, 2023, and Defendant Christina Palacios was served on September 25, 2023. (Id. ¶ 6-7.) Counsel further declares that “Counsel for Defendants neglected to ensure that Martinez, Dieterich & Zarcone Legal Group was in contact with the Defendants to determine if and when the Complaint was served on Defendants.” (Id. ¶ 8.)

“My predecessors, and MDZ staff, neglected to file an answer from the time the Complaint was filed until the default was taken to determine if Defendant had been properly served with the Complaint. Had the MDZ staff, filed an answer on behalf of Defendant prior to November 21, 2023 the defendants’ default would not have been entered. My predecessors neglected to ensure that MDZ staff were sufficiently monitoring the Los Angeles County Superior Court docket and in contact with Defendants to determine if and when the Complaint was served on Defendants. As a result of MDZ’s staff’s mistake, a default was entered against Defendant in the subject matter which could have been prevented had MDZ properly communicated with Defendant to determine if he was served with the Complaint prior to the default being entered.”

In opposition, Plaintiff contends that it was Loya’s staff that was responsible for the default, and not the attorney since Plaintiff was communicating with Loya’s claim adjuster throughout this litigation.

While Defendants’ counsel states he has been employed at MDZ since November 14, 2023, he never declares that he was Defendants’ counsel and was responsible for monitoring their case. Although he generally states that the “loss of attorneys and staff created confusion as to who was responsible for which files,” and that unspecified “predecessors, and MDZ staff, neglected to file an answer,” no declaration of counsel is provided regarding the failure to timely file an answer. (Urbano Decl. ¶ 5, 16.) Accordingly, counsel has not established that MDZ was timely notified and retained by Loya to represent the particular defendants in this case,[3] and that their attorney’s mistake, inadvertence, surprise, or neglect caused the default.

[1] The Court notes that both Lang and SJP Limited Partnership are cases decided by the Second District Court of Appeal. SJP Limited Partnership was decided after Lang and relies on Benedict.

[2] In opposition, Plaintiff does not explicitly contend that this motion is untimely based on the mandatory provision, but instead cites to the discretionary provision which also requires that it be made “within a reasonable time”, not to exceed six months. (Code Civ. Proc., § 473, subd. (b); Opp., 10.) Neither party addresses the timeliness of the motion when judgment has not yet been entered.

[3] In opposition, Plaintiff demonstrates that counsel was first contacted by MDZ on December 4, 2023. (Dequito Decl., Exh. 7.)

DEPT:	32
HEARING DATE:	September 6, 2024
CASE NUMBER:	23STCV01680
MOTIONS:	Motion to Vacate Entry of Default
MOVING PARTY:	Defendants Christina Palacios and Alma Rosa Palacios
OPPOSING PARTY:	Plaintiff Sharan Trana Jones