Judge: Bruce G. Iwasaki, Case: 22STCV01789, Date: 2023-10-03 Tentative Ruling
Case Number: 22STCV01789 Hearing Date: October 3, 2023 Dept: 58
Judge Bruce G. Iwasaki
Department 58
Hearing Date: October
3, 2023
Case Name: Karime
Caetano v. Edgar Garrido, et al.
Case No.: 22STCV01789
Motion: Motion
to Set Aside Default Judgment
Moving Party: Defendants
Mario Garrido, Edgar Garrido, and Manuel Mendoza
Opposing Party: Plaintiffs
Karime Caetano and Javier Caetano Tapiz
Tentative Ruling: The
Motion to Vacate and Set Aside Default is granted. Defendants’ counsel is ordered to pay fees of
$1,000.
This action arises from a
landlord-tenant dispute. The Complaint alleges landlords, Defendants Mario Garrido, Edgar Garrido, and Manuel Mendoza
(Defendants) owned and managed an uninhabitable apartment building where Plaintiffs
resided. On
January 18, 2022, Plaintiffs Karime Caetano and Javier Caetano
Tapiz (Plaintiffs) filed a Complaint alleging causes of action for (1.)
negligence, (2.) breach of implied warranty of habitability, (3.) breach of Los
Angeles County Code section 8.52.130 et seq., and (4.) violation of
Business and Professions Code section 17200.
On September 27, 2022, Defendants Mario Garrido, Edgar Garrido, and Manuel Mendoza filed separate General
Denials. On May 18, 2023, following an OSC re: Defendants to appear by and
through a new attorney, or appear in person for this order, the Court struck
the General Denials and entered default as to these Defendants.
On July 19, 2023, the Court entered default judgment
as to Defendants.
On September 11, 2023, Defendants moved
to set aside the default and default judgment. Plaintiffs filed an opposition.
No reply was filed.
The motion to set
aside and vacate the default and default judgment is granted. Counsel for Defendants shall pay to Plaintiffs’
counsel $1,000 on or before October 20, 2023.
Defendants’ responsive pleading shall be served and filed on or before
October 20, 2023.
Analysis
Defendants seek relief on
numerous legal grounds: Code of Civil Procedure sections 128, 286, 425.11, 435,
453, 473, 473.5, 585, 585.5, 594, the 14th Amendment to the United States
Constitution, Article 1, § 7 of the California Constitution, and / or pursuant
to the Court’s inherent or equitable powers. The Court will only address Defendants’
legal arguments that are developed both legally and factually.
Defendants first argue that
the default judgment is void based on Plaintiffs’ failure to serve a statement
of damages as required under Code of Civil Procedure section 425.11. (Altholz
Decl., ¶ 3.)
“[B]efore a default may
be taken” in such a case, a “plaintiff shall serve” a statement of damages
pursuant to section 425.11, subdivision (c), “setting forth the nature and
amount of damages being sought.” (Code Civ. Proc., § 425.11, subds. (b), (c).)
In opposition, Plaintiffs argue
that they were not required to serve a Statement of Damages because this was a
landlord-tenant case. Plaintiffs these cite Kim v. Westmoore Partners, Inc.
(2011) 201 Cal.App.4th 267. It is not
entirely clear the purpose that Plaintiffs rely on Kim v. Westmoore
Partners, Inc. —which did not hold as a matter of law that no statement of
damages are necessary in landlord-tenant cases.
Rather the question of
whether a statement of damages is required turns on the evaluation of the
pleadings and relief sought. Here, the negligence cause of action in the Complaint
states: “As a direct, proximate and foreseeable result of Defendants’
negligence, Plaintiffs suffered physical injuries, great mental
anguish and emotional distress including anxiety, annoyance, trouble
sleeping, fear, stress, and inconvenience, as well as destruction of their
personal property, all to their general damage in amounts to be proven at
trial, currently estimated at $200,000.” (Compl., ¶ 18 [emphasis added].)
Thus, the Complaint seeks relief based
on a personal injury. However, a review of
the Complaint and specifically this cause of action for negligence shows that
the negligence claim is based on a breach of the duty to “provid[e] Plaintiff
with a safe, habitable, legal, and tenantable dwelling.” (Compl., ¶ 16.) Additionally,
while the Complaint alleges Plaintiffs suffered “physical injuries” this
allegation is pled in a conclusory fashion without any ultimate facts.
Accordingly, Plaintiffs’ action is not
a personal injury action as defined by Code of Civil Procedure section 425.10.
(See Schwab v. Rondel Homes, Inc. (1991) 53 Cal.3d 428, 432 [“where an
emotional distress claim is ‘incidental’ to the cause of action, the cause of
action will not be considered an action ‘to recover damages for personal
injury’ “].) Therefore, this basis to set aside the default judgment fails.
Defendants also seek
relief based on attorney mistake. Specifically, Defendants’ new attorney, Attorney
Gaugh, represents that he mistakenly believed that he had filed substitutions
of attorney forms for all three Defendants on or around January 12, 2023.
(Gaugh Decl., ¶ 9.) This mistaken belief led to the entry of default and
default judgment.
Code of Civil
Procedure section 473, subdivision (b) provides for either discretionary or
mandatory relief from certain prior actions or proceedings in the trial court.
(Luri¿v. Greenwald¿(2003) 107 Cal.App.4th 1119, 1124.)¿¿
“ ‘Under the discretionary
relief provision, on a showing of “mistake, inadvertence, surprise, or
excusable neglect,”¿the court has discretion to allow relief from a “judgment,
dismissal, order, or other proceeding taken against”¿a party or his or her attorney.¿¿Under
the mandatory relief provision, on the other hand, upon a showing by attorney
declaration of “mistake, inadvertence, surprise, or neglect,”¿the court shall
vacate any “resulting default judgment or dismissal entered.” ’ [Citation.]
Applications seeking relief under the mandatory provision of section 473 must
be ‘accompanied by an attorney’s sworn affidavit attesting to his or her
mistake, inadvertence, surprise, or neglect.’ The mandatory provision¿further
adds that ‘whenever relief¿is granted based on an attorney’s affidavit of fault
[the court shall] direct the attorney to pay reasonable compensatory legal fees
and costs¿to opposing counsel or parties.’¿”
(Ibid.; Code Civ. Proc., § 473, subd. (b).)¿¿
The purpose of this
mandatory relief provision is to alleviate the hardship on parties who lose
their day in court due to an inexcusable failure to act by their attorneys. (Zamora v. Clayborn Contracting Group, Inc. (2002) 28 Cal.4th 249, 257.) More recently, the
Court of Appeal has stated the purpose was to relieve the innocent client of
the burden of the attorney's fault, to impose the burden on the erring
attorney, and to avoid precipitating more litigation in the form of malpractice
suits. (SJP Limited Partnership v. City of Los Angeles (2006)
136 Cal.App.4th 511, 516.)
Here, the primary evidence to support
the set aside under the mandatory provision is attorney Gaugh’s admission that
his paralegal failed to file the substitutions of counsel and he did not discover
this error until August 2023 when he discovered default judgment had been
entered. (Gaugh Decl., ¶¶ 9-10, 19.) Attorney Gaugh further represents that he
was retained on December 28, 2022 and was on email correspondence, dated
December 28, 2022, between Defendants’ prior counsel and Plaintiffs’ counsel
informing Plaintiffs that he would be new counsel for Defendants in this matter.
(Gaugh Decl., ¶¶ 5-6.) Attorney Gaugh states that he understood the following
to be the only matters pending in this case at the time he entered the case: an
FSC set for July 30, 2024, and a trial set for August 5, 2024. (Gaugh Decl., ¶
10.)
In response to this evidence,
Plaintiffs’ counsel states that Attorney Gaugh’s declaration is not credible
and misstates or omits several important facts. Primarily, Plaintiffs note that
attorney Gaugh first appeared in this matter on November 7, 2022, at which time
he attended a case management conference and was ordered by this Court to file
substitutions of attorney by November 29, 2022. (Brinton Decl., ¶ 6.)
Plaintiffs’ counsel also states that he never received notice that Attorney
Gaugh was taking over representation of this matter from Attorney Altholz.
(Brinton Decl., ¶ 12.)
While the completeness of the Gaugh declaration
is indeed questionable, it does meet the requirements to demonstrate attorney
fault – whether excusable or not. The opposition argues that many of the statements
made by Attorney Gaugh are contradicted. However, upon review, the statements
are not directly contradicted -- only selective in the facts presented.[1]
That is, attorney Gaugh’s representation as to when he entered the case and
the fact that he was ordered to file substitutions of counsel was omitted;
these facts are not material to this motion. As such, none of the material
facts supporting attorney fault are contradicted. The material fact is Attorney
Gaugh’s admission that his firm was responsible for failing to file the
necessary substitutions of attorney that led to this matter’s dismissal. Thus,
the declaration sufficiently demonstrates inexcusable neglect or mistake.
Further, Defendants represent that the addresses
that they were served at were neither their residence, mailing address or places
of business. (M. Mendoaza Decl., ¶¶ 2-4; M. Garrido Decl., ¶¶ 2-4; E. Garrido
Decl., ¶¶2-3.) Additionally, Defendants’ prior counsel informed Plaintiffs that
these addresses were incorrect. (Altholz Decl., ¶¶ 4-5.)
Plaintiffs’ counsel does not dispute
that he was informed that the addresses he relied upon were not Defendants’
correct address. Instead, Plaintiffs argue that Attorney Altholz was still attorney
of record when service was made to him. However, as Plaintiffs note, on October
6, 2022, the State Bar Court suspended Attorney Altholz’s license to practice
law, subsequently disbarring him. (Brinton Decl., ¶ 4.) Thus, when Plaintiffs
served Defendants’ counsel, they served an attorney whom they knew was ineligible
to practice law. Plaintiffs do not cite legal authority that demonstrates that service
on Defendants under these circumstances was consistent with the law.
Accordingly, the motion to set aside
the entry of default and default judgment is granted based on attorney fault.
Plaintiffs argue, if the Court grants
relief, Plaintiffs are entitled to their counsel’s fees “incurred to date.”
(Opp. 8:9-10.) However, even Plaintiffs’ own legal authority limits relief to
relief “incurred in obtaining the defaults.” (Opp. 8:6-7.) When relief is granted based on an attorney’s affidavit
of fault, the court “shall” “direct the attorney to pay reasonable compensatory
legal fees and costs to opposing counsel or parties.” (Code Civ. Proc., § 473, subd. (b).) However, the amount is limited to $1,000 and relief
cannot be conditional on payment of fees or penalties. (Id. at subds. (c)(1)(A) and (c)(2).)
Conclusion
The motion to set aside the default
judgment is granted. Defendants’ counsel
is ordered to pay to Plaintiffs’ counsel $1,000 on or before October 20,
2023. Defendants shall serve and file
their responsive pleading on or before October 20, 2023.