Judge Bruce G. Iwasaki, Case Number: 25STCV02049, Date: 2025-05-12 Tentative Ruling

Plaintiff Martha Gonzalez brings this action against Defendants Vicente Carrillo, Josefina Soto, and Sergio Garcia, alleging causes of action for (1.) quiet title, (2.) fraud, and (3.) intentional infliction of emotional distress. Plaintiff Martha Gonzalez alleges that, although title to the property, located at 3821 Revere Ave., Los Angeles, CA, is held by Defendants Vicente Carrillo, Josefina Soto, and formerly Sergio Garcia -- the home was purchased with funds from her ex-husband Luis Carrillo (Vicente’s brother) and has been her sole residence since 2001, during which she made significant financial contributions and improvements. She claims Defendants committed fraud and caused emotional distress by promising to transfer ownership to her in exchange for payments, only to later initiate eviction despite acknowledging the property was always intended for Luis and his family.

Now, Defendants Vicente Carrillo and Sergio Garcia move to set aside the entry of default.[1] Plaintiff has filed an opposition. A late reply was filed on May 9, 2025.

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).)¿¿

Defendants move to set aside the entries of default pursuant to Code of Civil Procedure section 473, subdivision (b).

Defendants assert that relief must be granted based on the mandatory provision of Section 473 for attorney mistake.

For purposes of section 473, subdivision (b), an attorney affidavit must admit that the attorney's mistake or neglect caused the default, dismissal, or adverse judgment the party wishes to set aside. (Code Civ. Proc., § 473, subd. (b) [mandatory relief not warranted where “default or dismissal was not in fact caused by the attorney's mistake”]; see Milton v. Perceptual Dev. Corp. (1997) 53 Cal.App.4th 861, 867 [The requirement is “not only a credibility testing device” but “also ‘a causation testing device.’ ”].)

The only statutory limitation of this mandatory relief applies when the court finds the default “was not in fact caused by the attorney's mistake, inadvertence, surprise, or neglect.” (Code Civ. Proc., § 473, subd. (b).) “Relief may be denied only ‘when the court finds [that] the default was not in fact the attorney's fault, for example when the attorney is simply covering up for the client. [Citation.]’ ” (Rodrigues v. Superior Court (2005) 127 Cal.App.4th 1027, 1033.)

In support, Defendants’ counsel, David Ruttenberg, submits a declaration attesting to the fact that he informed Plaintiff’s counsel on February 4, 2025 that he would be representing Defendants in the instant action. (Ruttenberg Decl., ¶¶ 2-3.) He received a copy of the complaint that same day. (Ruttenberg Decl., ¶ 3.) Counsel represents that “Due to the exchanges between counsel regarding the litigation involving the Property, [he] believed that [Plaintiff’s counsel] was aware of Defendants’ representation and mistakenly expected [Plaintiff’s counsel]to provide notice prior to seeking default judgment against Defendants, resulting in the failure to timely respond to the Complaint.” (Ruttenburg Decl., ¶ 6.)

In opposition, Plaintiff argues that Defendants’ counsel was not officially retained until after defendants’ responses were due.

However, the absence of a retainer agreement showing a specific date of Defendants’ counsel being retained in this action is not determinative where the facts show that Defendants’ counsel was already operating in a representative capacity on behalf of Defendants in a related action and had represented to Plaintiffs’ counsel that it was acting on Defendants’ behalf in this matter. Attorney Ruttenberg further states that the failure to prevent the default was his fault based on his mistaken belief that he would receive notice before a default was entered.[2]

This declaration is sufficient to show attorney fault resulting in the entry of default. Relief is mandatory.[3]

In opposition, Plaintiff also seeks attorney fees in the amount of $1,380 pursuant to Code of Civil Procedure section 473, subdivision (b).

When the court grants mandatory relief based on an attorney's affidavit of fault, section 473, subdivision (b), requires the court to “direct the attorney to pay reasonable compensatory legal fees and costs to opposing counsel or parties.” In addition, the court may impose a penalty up to $1,000, direct the attorney to pay up to $1,000 to the State Bar Client Security Fund, or grant “other relief as is appropriate.” (Id., subd. (c)(1).)

Plaintiff’s counsel seeks an hourly rate of $1,150 an hour. While Plaintiff’s counsel is entitled to reasonable fees, the hourly rate is excessive. Attorney fees are awarded at the reduced rate $750 an hour for 1.2 hours, for a total attorney fee amount payable of $900. Defendant’s counsel is also ordered to pay $250 to the State Bar Client Security Fund; Defendant shall file and serve a declaration of compliance to the Court upon paying both amounts. Defendant’s attorney shall pay the $900 attorney’s fee award to Plaintiff’s counsel, and the $250 penalty to the State Bar, on or before June 13, 2025.

The motion to set aside the entry of default against Defendants Vicente Carrillo and Sergio Garcia is granted. Defendant shall file and serve a responsive pleading on or before May 23, 2025.

Defendant’s attorney shall pay the $900 attorney’s fee award to Plaintiff’s counsel, and the $250 penalty to the State Bar, on or before June 13, 2025 and shall file and serve a declaration of compliance promptly thereafter.

[1] The March 19, 2025 request for entry of default against Defendant Josefina Soto was rejected by the Court on March 27, 2025.

[2] Indeed, several cases suggest that best practices require notice to the other party before seeking entry of default. (Smith v. Los Angeles Bookbinders Union No. 63 (1955) 133 Cal.App.2d 486, 500 [“The quiet speed of plaintiffs’ attorney in seeking a default judgment without the knowledge of defendants’ counsel is not to be commended.”]; Fasuyi v. Permatex, Inc. (2008) 167 Cal.App.4th 681, 701; Lasalle v. Vogel (2019) 36 Cal.App.5th 127, 140.)

[3] Both parties discuss whether Defendants have a meritorious defense. However, a meritorious defense is required only where the defendant seeks equitable relief from default judgment, apart from relief under section 473(b). Equitable relief refers to a court's inherent authority to set aside default judgment resulting from extrinsic fraud or mistake. (See Rappleyea v. Campbell (1994) 8 Cal.4th 975, 981.) In order to qualify for equitable relief, the moving party must show: (1) a meritorious defense; (2) a satisfactory excuse for not asserting the defense originally; and (3) diligence in seeking to set aside default upon discovery. (Id. at p. 982.) Thus, the question of a meritorious defense is not relevant to the Court’s ruling on whether the motion meets the mandatory requirements of Section 473, subdivision (b).

Department 58