Judge Christian R. Gullon, Case Number: 24PSCV03531, Date: 2025-05-29 Tentative Ruling

Judge: Christian R. Gullon, Case: 24PSCV03531, Date: 2025-05-29 Tentative Ruling

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MOTION BY DEFENDANT AGRITEC INTERNATIONAL LTD DBA CLEAN TECH ENVIROMENTAL INC. A WISCONSIN CORPORATION FOR AN ORDER VACATING ENTRY OF DEFAULT AND JUDGMENT PURSUANT TO Cal. Code Civ. Proc. § 473 AND FOR LEAVE TO DEFEND is GRANTED based upon the financial officer’s inadvertence/mistake in not knowing that a corporate entity in an unlimited civil case must be represented by an attorney and for acting diligently to set aside the judgment; the court conditions the dismissal upon payment of $2,421.00 upon Defendant for the reasonable attorney fees Plaintiff incurred in connection with both the default judgment and this motion/opposition.

This is a contracts case. Plaintiff J&D FLEET SERVICE, INC. alleges the following against Defendant AGRITEC INTERNATIONAL LTD, dba CLEANTECH ENVIRONMENTAL, INC.: In July 2021, Plaintiff and Defendant entered into a business relationship wherein Plaintiff would provide fleet repair services for Defendant s vehicles. This arrangement continued without incident for approximately two years, during which Plaintiff performed over 100 service jobs on Defendant s fleet. On or about February 10, 2023, Defendant ceased making payments on Plaintiff s invoices. Plaintiff continued to service Defendant’s fleet, with invoices consistently going unpaid.

On May 16, 2025, Plaintiff filed an opposition and that same day, Defendant filed its reply.

California Code of Civil Procedure §473 states: ". . . [t]he court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect . . . within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken. . . .”

Most of the motion is dedicated to the underlying dispute the parties, but from what the court has gathered, the claimed misunderstanding is that a corporate officer could personally appear without legal representation. “Mr. Khalil had no idea that he was supposed to have something filed in court in response instead of just showing up at the Case Management Conference hearing. He had no idea that he couldn’t appear for the corporation CleanTech herein as he did in small claims.” (Motion p. 4; see also Opp. p. 4.) For reasons to be explained below, the court finds that granting relief ultimately serves the policy of hearing cases on their merits. (See Motion, citing Shapell Socal Rental Properties, LLC v. Chico's FAS, Inc. (Shapell) (2022) 84 Cal.App.5th 166, 212–213.)

The court agrees with Plaintiff on the law: a corporate entity must appear through a licensed attorney. (Opp. p. 6, citing See CLD Construction, Inc. v. City of San Ramon (2004) 120 Cal.App.4th 1141, 1148; Merco Constr. Engineers, Inc. v. Municipal Court (1978) 21 Cal.3d 724, 729.) But the court disagrees with Plaintiff that Defendant/Khalil did not act reasonably. Plaintiff argues that Defendant’s statements are contradictory in that Khalil claims he is “familiar with small claims procedure” yet on the same token avers that he did not know that Defendant needed formal representation. But that is very point of the motion: that there is a different procedure in unlimited civil cases wherein representation by counsel is necessary for a corporate entity. Moreover, Plaintiff argues that “Khalil’s claimed course of action—attending the case management conference without counsel—was a legal nullity from the outset.” (Opp. p. 6:24-25.) However, the court’s docket does not provide a minute order documenting a CMC. And had there been a CMC, the court informs corporate entities that they must be represented by counsel. Ultimately, the case is recent and there is no indication that the Plaintiff would be severely prejudiced by granting the motion.

To the extent that Plaintiff seeks attorney fees in drafting an opposition should the motion be granted, Plaintiff’s authority supports such a recovery, authority which the reply does not address. (See Opp. p. 7, citing Vanderkous v. Conley (2010) 188 Cal.App.4th 111, 118 [a trial court may properly condition the granting of relief on the payment of attorney fees and costs]; Rogalski v. Nabers Cadillac (1992) 11 Cal.App.4th 816, 822 [plaintiff was entitled to recover fees and costs incurred in securing default judgment]; Jade K. v. Viguri (1989) 210 Cal.App.3d 1459, 1474 [fees and costs awarded to compensate adverse party upon vacating default].) Plaintiff’s counsel seeks $1,200.00 in attorneys’ fees in connection with the Request for Court Judgment and additional $1,221.00 in additional attorneys’ fees reasonably incurred in opposing the motion (3.7 hours at $330/hour). Utilizing a lodestar approach and considering the totality of the circumstances, the court finds the attorney fees reasonable.

All in all, taking Plaintiff’s own citation to Gillingham v. Lawrence (1909) 11 Cal.App. 231 wherein the defendant admitted receiving the summons but did nothing to investigate his legal obligations claiming he didn’t know he had to file an answer, here, Plaintiff’s own opposition maintains that Defendant did attempt to litigate the matter, just incorrectly by attempting to represent the entity himself. Thus, the court GRANTS the motion to set aside the default and default judgment based upon the financial officer’s inadvertence/mistake and also GRANTS Plaintiff’s request for attorney fees in the total amount of $2,421.00 upon Defendant.

[1] In the opposition, Plaintiff states that Khalil attended a case management conference without counsel; but the court’s docket does not provide a minute order documenting a CMC.