Judge: Anne Richardson, Case: BC419058, Date: 2023-09-20 Tentative Ruling

Case Number: BC419058    Hearing Date: January 24, 2024    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

Background

Pleadings

Plaintiff Eastland Corporation sued a number of Defendants—including Defendant Ji Young Joo—pursuant to a July 31, 2009 Complaint alleging claims of (1) Breach of Contract, (2) Open Book Account, (3) Account Stated, (4) Goods Sold and Delivered, and (5) Statutory Damages on Dishonored Checks.

The claims arose from allegations that Plaintiff and Defendants entered an agreement for the purchase of goods—specifically fresh and frozen meat products, with Plaintiff as the seller and Defendants as the purchasers—and that Plaintiff delivered goods to Defendants only for Defendants to either fail to pay their debt or to provide checks that bounced for insufficient funds, thus damaging Plaintiff in the amount of $55,702.51.

Entry of Default and Default Judgment

On November 13, 2009, Plaintiff secured an entry of default against all Defendants except for Tae Hwan Joo and Moon Kwon Joo, i.e., against Defendants La Galbi, Inc., Moon & Flower, Inc., Young Jin Corporation, Won Chang, Ji Young Joo, Madangsae, Inc., Ho Bok, Inc., In Ho Lee, Bok Kim Tae, 153 OK, Inc., and In Gap Chun (the Defaulted Defendants).

On January 28, 2010, Plaintiff filed a complete default judgment packet against the Defaulted Defendants.

That same day, pursuant to Plaintiff’s request, the Court entered judgment against the Defaulted Defendants.

Renewed Judgment, Writ of Execution, and Levy

On January 21, 2020, Plaintiff applied for a renewal of judgment.

That same day, a notice of renewal of judgment was issued by the Clerk.

On June 15, 2023, Plaintiff filed a memorandum of costs after judgment.

That same day, Plaintiff applied for, and the Clerk issued a writ of execution for a money judgment.

On July 21, 2023, Defendant Ji Young Joo (Joo) received notice that approximately $53,779.91 had collectively been taken out of seven bank accounts held by Joo at Bank of America.

Motion Work by Defendant Joo

On July 31, 2023, Defendant Joo made an ex parte application to recall and quash the June 15, 2023 writ of execution. The ex parte application also informed the Court that Defendant Joo had set a formal motion to set aside default judgment in this matter for hearing on October 23, 2023.

On August 1, 2023, Plaintiff opposed the ex parte application.

On August 2, 2023, the Court denied the ex parte application but calendared a hearing on the same relief for October 23, 2023, to be heard concurrently with the motion to set aside default judgment. The Court ordered the levying officer to hold the funds and not disburse them.

On August 16, 2023, Plaintiff’s counsel filed and served a notice of hearing on a claim of exemption made by Defendant Joo. Service was made on the Los Angeles County Sheriff’s Office and Defendant Joo’s counsel—Equitable Law Group.

That same day, Plaintiff’s counsel filed a notice of opposition to claim of exemption.

On September 20, 2023, the Court continued the hearing on the claim of exemption to October 23, 2023 to be heard concurrently with the proposed motion to set aside the default and default judgment.

On September 25, 2023, Defendant Joo filed her motion to set aside the default.

On September 26, 2023, Defendant Joo filed her motion to recall and quash the writ of execution.

On October 9, 2023, Plaintiff opposed the motions to set aside default and to quash the writ.

On October 16, 2023, Defendant Joo replied to the October 9th oppositions.

On October 23, 2023, Defendant Joo’s motion to set aside, motion to quash, and claim of exemption came before the Court, at which time the Court denied the motions to set aside and quash but continued the hearing on the claim for exemption based on the lack of a copy of the claim of exemption in the record. The hearing on the claim of exemption was continued to November 17, 2023.

On October 31, 2023, the Los Angeles County Sheriff’s Department (LASD; levying officer) filed a memo containing copies of Defendant Joo’s claim of exemption and the notices of hearing and opposition.

On November 9, 2023, Defendant Joo filed a declaration in support of her claim, which attached the claim of exemption as Exhibit 1.

On November 17, 2023, the Court granted Defendant Joo’s claim of exemption, which directed the court clerk to transmit a certified copy of the order to the levying officer, which would release the Bank of America assets to the accounts from which they were levied.

Motion Now Before the Court

On December 19, 2023, Defendant Joo again moved to set aside the default and default judgment against her. The motion differs from the prior September 25, 2023 motion to set aside insofar as the September motion attacked the judgment on voidness grounds and the December motion attacks the judgment on extrinsic mistake.

A proof of service is attached to the December 19, 2023 motion, which shows service of the motion on Plaintiff’s counsel, Kimberly Barrientos, via email, on December 19th.

Plaintiff has failed to oppose Defendant Joo’s December 19th motion, which is now before the Court.

Motion to Set Aside-Vacate, Extrinsic Mistake

Legal Standard

“After six months from entry of default, a trial court may still vacate a default on equitable grounds even if statutory relief is unavailable.” (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 981; Olivera v. Grace (1942) 19 Cal.2d 570, 576 [Relief from default or default judgment can be sought at any time on the ground of extrinsic mistake]; Sporn v. Home Depot USA, Inc. (2005) 126 Cal.App.4th 1294, 1300 [same].) This is a form of equitable relief, rather than statutory relief, and is based on a finding by the court that the judgment is void. (See Trackman v. Kenney (2010) 187 Cal.App.4th 175, 180-181 [contrasting Code Civ. Proc., § 473, subd. (d) and extrinsic fraud or mistake]; Manson, Iver & York v. Black (2009) 176 Cal.App.4th 36, 47 [“After the six-month period for statutory relief has passed, the court may still grant relief on equitable grounds, including extrinsic fraud or mistake”].) Yet, “[w]hen a default judgment has been obtained, equitable relief may be given only in exceptional circumstances. ‘[W]hen relief under section 473 is available, there is a strong public policy in favor of granting relief and allowing the requesting party his or her day in court. Beyond this period there is a strong public policy in favor of the finality of judgments and only in exceptional circumstances should relief be granted.’” (Rappleyea v. Campbell, supra, at pp. 981-982, quoting In re Marriage of Stevenot (1984) 154 Cal.App.3d 1051, 1071; see also Pulte Homes Corporation v. Williams Mechanical, Inc. (2016) 2 Cal.App.5th 267, 275-276.)

There are three essential requirements to obtain relief on this ground: (1) a meritorious defense; (2) diligence in seeking relief once the default or default judgment is discovered; and (3) a satisfactory excuse for not presenting a defense to the original action. (Rappleyea v. Campbell, supra, 8 Cal.4th at p. 982; see also Kramer v. Traditional Escrow, Inc. (2020) 56 Cal.App.5th 13, 29.) The statutory time limits on relief under Code of Civil Procedure sections 473, subdivision (b), and 473.5 do not apply, but once the purported extrinsic fraud or mistake is discovered, a party is expected to proceed diligently to seek relief. (Rappleyea v. Campbell, supra, at pp. 983-984.) This requirement is inextricably intertwined with prejudice to the plaintiff. (Ibid.)

Order Setting Judgment Aside: GRANTED.

Defendant Joo moves for a court order setting aside the entry of default and default judgment against her in this action on the ground of extrinsic mistake.

To prove a meritorious case, Joo attaches a proposed unverified Answer to her motion, which includes general denials to the unverified Complaint’s allegations. Joo also argues that the contracts at issue do not name her, and that Plaintiff has provided no evidence to support its alter ego allegations against her. Joo adds that she has no relationship with any of the parties to this action and that she was never an officer, director, or shareholder of either company in the contracts attached to the Complaint. (Mot., pp. 4-5, citing Mot., Joo Decl., Ex. 1; cf. Mot., Joo Decl., ¶ 5 [Joo has “no relationship or affiliation with Defendant LA Galbi” and “[is] not an officer, director, or shareholder with Plaintiff or Defendant LA Galbi, nor any of the other companies or corporations named as defendants.”)

To prove diligence in seeking relief once the default or default judgment was discovered, Defendant Joo points to her prompt actions since July 21, 2023 to reverse the levy of monies from her Bank of America accounts. (Mot., pp. 6-7, citing Mot., Joo Decl., ¶ 11.)

To prove a satisfactory excuse for not presenting a defense to the original action, Defendant Joo discusses how she was never served with the summons and complaint. Joo explains that service on her was effected on August 11, 2009, at an address where she did not live at that time, though Joo had lived there several months prior before moving away. (Mot., pp. 5-6, citing Mot., Joo Decl., ¶¶ 7-10; cf. 10/16/23 Joo Decl., ¶¶ 5-6 [lived at the Masselin address—where service was effected—between September 17, 2008 and March 5, 2009].)

No opposition or reply appeared in the record.

The Court finds in favor of Defendant Joo.

The Court accepts that Defendant Joo first discovered the default and default judgment in or around July 21, 2023, i.e., when more than $50,000 were levied from her Bank of America accounts. (Mot., Joo Decl., ¶ 10.) Defendant Joo has represented that she became aware of this lawsuit in April 2009 and left a voicemail with Plaintiff’s counsel, who failed to return the call. (10/16/23 Joo Decl., ¶ 3.) However, Plaintiff did not secure an entry of default against the Defaulted Defendants—including Joo—until November 13, 2009, and Judge Michelle Rosenblatt did not grant default judgment against these Defendants until January 28, 2010. If Defendant Joo was not aware of the entry of default and default judgment against her until July 2023, her conduct since that time—filing two motions to set aside default and default judgment, a motion to quash writ, and a claim of exemption, with multiple hearings and briefing—shows diligence.

The Court can also accept that Defendant Joo lived at the Masselin address up through March 5, 2009, for which reason service was effected at an address where she did not live, undercutting service pursuant to Code of Civil Procedure section 415.20 (substituted service). (Mot., Joo Decl., ¶¶ 7-11; see also 10/16/23 Joo Decl., Ex. 1 [Westlaw address history confirms March 5, 2009 move out date].)

Finally, the Court finds that the lack of specific allegations as to Joo, the absence of a contract with her name on it, and her various denials of having any relationship to the Defendants in the Proposed Answer and in her Declaration are sufficient to establish a bona fide and potentially meritorious defense. Defendant Joo has also shown diligence and a satisfactory explanation for not having acted sooner. The Court again notes this motion is unopposed.

Defendant Joo’s motion is thus GRANTED. 

Conclusion

Defendant Ji Young Joo’s Motion to Set Aside and Vacate Default is GRANTED. The Answer shall be filed within 5 calendar days.