Judge Audra Mori, Case 19STCV10771 2022-08-02 Tentative Ruling

Plaintiff Alexander Olshansky (“Plaintiff”) filed this action against defendants Mikhail Cheban, et al. asserting causes of action for negligence and premises liability. Plaintiff alleges he was working within the course and scope of his employment installing and/or performing maintenance on a heating A/C unit at defendants’ warehouse. Plaintiff was allegedly utilizing scaffolding to reach the unit, but the scaffolding collapsed while Plaintiff was on it and suffered serious injury.

On February 9, 2022, Plaintiff filed proof of service of summons and First Amended Complaint (“FAC”) on Defendant Mikhail Cheban (“Defendant”) showing Defendant was served by substituted service by leaving the documents with a John Doe at 2716 E. Florence Ave., Huntington Park, CA 90255 on January 19, 2022. The proof of service includes a declaration of due diligence.

Defendant now moves to quash service of the summons and FAC. Plaintiff opposes the motion, and Defendant filed a reply.

Plaintiff requests the court take court take judicial notice of the following Exhibits attached to the declaration of Plaintiff’s counsel submitted with the opposition: Exhibits 1-4, which consist of Articles of Incorporation and Statements of Information for Nasha, LLC and Statements of Information for Amarillo Pawnshop, Inc. filed with the Secretary of State, and Exhibit 5, which is a copy of a complaint filed in Los Angeles Superior Court Case No. 21STCV45987. (Opp. Finnerty Decl. ¶¶ 2-6, Exhs. 1-5.)

The request as to Exhibits 1-4 is granted pursuant to Evid. Code § 452(c). (See Friends of Shingle Springs Interchange, Inc. v. County of El Dorado (2011) 200 Cal.App.4th 1470, 1483-84.) The request as to Exhibit 5 is granted pursuant to Evidence Code § 452(d).

“A defendant . . . may serve and file a notice of motion for one or more of the following purposes: (1) To quash service of summons on the ground of lack of jurisdiction of the court over him or her. . . .” (CCP § 418.10(a).)

If a copy of the summons and complaint cannot with reasonable diligence be personally delivered to the person to be served, as specified in Section 416.60, 416.70, 416.80, or 416.90, a summons may be served by leaving a copy of the summons and complaint at the person's dwelling house, usual place of abode, usual place of business, or usual mailing address other than a United States Postal Service post office box, in the presence of a competent member of the household or a person apparently in charge of his or her office, place of business, or usual mailing address other than a United States Postal Service post office box, at least 18 years of age, who shall be informed of the contents thereof, and by thereafter mailing a copy of the summons and of the complaint by first-class mail, postage prepaid to the person to be served at the place where a copy of the summons and complaint were left.

“ ‘On a motion to quash service of summons, the plaintiff bears the burden of proving by a preponderance of the evidence that all jurisdictional criteria are met. [Citations.] The burden must be met by competent evidence in affidavits and authenticated documents; an unverified complaint may not be considered as supplying the necessary facts.’ [Citation.]” (Brown v. Garcia (2017) 17 Cal.App.5th 1198, 1203; see also Sheard v. Superior Court (1974) 40 Cal.App.3d 207, 211 [“[W]here a defendant properly moves to quash service of summons the burden is on the plaintiff to prove facts requisite to the effective service.”].)

“A defendant is under no duty to respond in any way to a defectively served summons. It makes no difference that defendant had actual knowledge of the action. Such knowledge does not dispense with statutory requirements for service of summons.” (Weil & Brown, Cal. Prac. Guide: Civ. Proc. Before Trial (The Rutter Group 2015) ¶4:414, p. 4-67 citing Kappel v. Bartlett (1988) 200 Cal.App.3d 1457, 1466 (Kappel) and Ruttenberg v. Ruttenberg (1997) 53 Cal.App.4th 801, 808 (Ruttenberg)) “[N]otice does not substitute for proper service. Until statutory requirements are satisfied, the court lacks jurisdiction over a defendant.” (Ruttenberg, supra, 53 Cal.App.4th at p. 808.) “[I]n California, ‘…the original service of process, which confers jurisdiction, must conform to statutory requirements or all that follows is void.”' (Id. at p. 809.)

“Statutes governing substitute service shall be ‘liberally construed to effectuate service and uphold jurisdiction if actual notice has been received by the defendant.... [Citation.]’ ” (Ellard v. Conway (1992) 94 Cal.App.4th 540, 544.) “The liberal construction [of the statute], it is anticipated, will eliminate unnecessary, time-consuming, and costly disputes over legal technicalities, without prejudicing the right of defendants to proper notice of court proceedings.” (Pasadena Medi–Center Associates v. Superior Court (1973) 9 Cal.3d 773, 788.)

Here, Defendant contends that service of the summons and FAC is defective because Defendant has been residing in Ukraine since July 4, 2018, and no longer conducts business in the United States. Defendant states that he has an ownership interest in the property located at Florence Ave., but he has not engaged in any business activity there since 2000 and does not receive or have access to any mail sent there. Further, Defendant contends service was improper because the proof of service indicates that a copy of the summons and complaint were mailed two days before substituted service was made on the John Doe.

In opposition, Plaintiff asserts Defendant has made multiple filings with the secretary of State listing the Florence address as his business address, which Plaintiffs contends contradict his self-serving declaration. Plaintiff avers that Defendant has thus certified the Florence Ave. address as his business address, and that Plaintiff’s substituted service was valid.

In reply, Defendant again asserts that while he may have an ownership interest in and formed business entities that use the Florence address as the principal place of business, Defendant himself has not conducted any business activity there since moving to Ukraine.

When a defendant files a motion to quash, the burden is on the plaintiff to establish that service of the summons and complaint was proper. (Summers v. McClanahan (2006) 140 Cal.App.4th 403, 413.) Plaintiff submits a copy of the Articles of Incorporation for Nasha, LLC that list Defendant as the agent for service of process and provides the Florence address as the address to be used for service of process. The Articles provide they were filed on July 16, 1998. (Mot. Exh. 1.) Plaintiff further submits a copy of a Statement of Information for Nasha, LLC, filed June 13, 2016, that states that Defendant is a manager or member of Nasha, LLC and its agent for service of process the Statement identifies the Florence Ave. address as Defendant’s address. (Mot. Exh. 2.) On November 19, 2020, a Statement of No Change was filed with the Secretary of State providing that there has been no change in the information contained in the previous Statement of Information filed. (Mot. Exh. 3.) Additionally, Plaintiff provides a Statement of Information for Amarillo Pawnshop that lists Defendant as its Chief Executive Officer, Secretary, Chief Financial Officer, and Director and lists the Florence Ave. location as his address for these positions. (Mot. Exh. 4.)

“The term ‘usual place of business’ includes a defendant's customary place of employment as well as his own business enterprise.” (CCP § 415.20(b), Judicial Council Comment.) Defendant admits he has an ownership interest in the property were substituted service was effected, (Mot. Cheban Decl. ¶ 4), and seemingly confirms that he formed the business entities that use the Florence Ave. address as their principal place of business. (See Reply at p. 2:5-8.) Plaintiff’s evidence is sufficient to demonstrate that the Florence Ave. address is Defendant’s “usual place of business” within the meaning of CCP § 415.20(b).

The United States District Court cases of Commercial Judgment Recovery Fund 1 LLC v. A2Z Plating Co., Inc. (C.D. Cal. 2011) 2011 WL 2941029, *3-4 (“Commercial Judgment”), and J&J Sports Prod., Inc. v. Castellon (2015) 2015 WL 6089898, *1-2 (“J&J Sports”), are instructive in finding that Defendant, in this case, was properly served with the summons and FAC under CCP § 415.20(b). In Commercial Judgment, the District Court found that service on a defendant, who was living out of the country at the time of service, at a California corporation of which the defendant was the CEO was sufficient to establish the corporation was the defendant’s usual place of business as defined in the Judicial Council Comment to CCP § 415.20(b). (Commercial Judgment, 2011 WL 2941029 at *4.) The conclusion was consistent with the interpretation that the substituted service statute be liberally construed. (Id.) Similarly, in J&J Sports, the District Court found that a restaurant was a defendant’s business enterprise for purposes of analyzing service under CCP § 415.20(b), where the defendant was listed on the restaurant’s current liquor license as a Director and Vice-President of the enterprise, even though the defendant worked full-time for another business. (J&J Sports Prod., 2015 WL 6089898 at *2.)

Although Defendant, in this case, attests that he lived in Ukraine at the time of service, the Articles of Incorporation and Statements of Information filed with the Secretary of State show that Defendant was listed as a manager or member and the agent for service of process for Nasha, LLC, and that Defendant is listed as the Chief Executive Officer, Secretary, Chief Financial Officer, and Director for Amarillo Pawnshop; both entities list the Florence Ave. address as their business address. Defendant does not challenge any of these allegations in his reply. Given Defendant’s status as a manager or member of Nasha, LLC, and as the Chief Executive Officer, Secretary, Chief Financial Officer, and Director for Amarillo Pawnshop, Defendant’s claim that he has not conducted any business activity at the Florence address to be suspect. The court finds the Florence address, where Defendant admits he has an ownership interest, is Defendant’s usual place of business under CCP § 415.20(b).

Additionally, Plaintiff submits a declaration from the process server that effected substituted service on Defendant; the process server states that he attempted personal service four separate times at the Florence Ave. address before serving the person who appeared to be in charge of the store and informing him that he was serving legal documents for Defendant. (American Express Centurion Bank v. Zara, 199 Cal.App.4th 383, 389 (2011) [to qualify as reasonable diligence, two or three attempts must first be made to personally serve the defendant]; Opp. Demirdjian ¶¶ 2-5.) Furthermore, the process server clarifies that he mailed the documents after the summons and FAC were served, and that the proof of service stating that the documents were mailed on January 17, 2022, is a typographical error; the documents were actually mailed on January 19, 2022. (Opp. Demirdjian ¶¶ 8-10.) Defendant does not challenge any of these contentions. Moreover, Defendant does not allege that he did not receive a copy of the summons and FAC after service, or that service resulted in him having actual knowledge of this action.

Based on the foregoing, Defendant’s motion to quash is denied. Defendant is ordered to file a responsive pleading within 30 days.

Hon. Audra Mori

Judge of the Superior Court