Judge: Curtis A. Kin, Case: 24STCP00454, Date: 2024-09-24 Tentative Ruling

Case Number: 24STCP00454    Hearing Date: September 24, 2024    Dept: 86

MOTION TO QUASH SERVICE OF SUMMONS AND COMPLAINT, OR, IN THE ALTERNATIVE

SET ASIDE ENTRY OF DEFAULT

Date:               9/24/24 (1:30 PM)

Case:                           Laurent Ruben v. Ikspan, Inc. (24STCP00454)

TENTATIVE RULING:

Defendant Ikspan, Inc.’s Motion to Quash Service of Summons and Complaint, or, in the Alternative Set Aside Entry of Default is DENIED.

Defendant Ikspan, Inc. moves for an order quashing service of summons, or alternatively, to set aside entry of default.

As a preliminary matter, defendant’s request for judicial notice is DENIED as “unnecessary to the resolution” of the issues before the Court. (Martinez v. San Diego County Credit Union (2020) 50 Cal.App.5th 1048, 1075.)

“When a defendant challenges the court’s personal jurisdiction on the ground of improper service of process ‘the burden is on the plaintiff to prove the existence of jurisdiction by proving, inter alia, the facts requisite to an effective service.’” (Summers v. McClanahan (2006) 140 Cal.App.4th 403, 413, quoting Dill v. Berquist Construction Co. (1994) 24 Cal.App.4th 1426, 1439-40.) “[C]ompliance with the statutory procedures for service of process is essential to establish personal jurisdiction. [Citation.]” Dill, 24 Cal.App.4th at 1444.)

According to a proof of service of summons filed on 2/23/24, plaintiff Laurent Ruben attempted to serve defendant through service on the person in charge at the office of Maurice David Pessah, Esq., on 2/23/24. (Robinson Decl. ¶ 17 & Ex. 9.) According to a proof of service filed on 2/28/24, plaintiff also attempted to serve defendant through substitute service on Flore K. Farrace, Esq. at Kanmacher Law PC, 1601 Pacific Coast Hwy #290, Hermosa Beach, CA 90254 on 2/27/24. (Robinson Decl. ¶ 18 & Ex. 8.) Default was entered against defendant on 4/24/24.

It is undisputed that respondent is a dissolved corporation. (Compl. ¶ 2.) CCP § 416.20 states, in relevant part: “A summons may be served on a corporation that…has dissolved, by delivering a copy of the summons and of the complaint…(b) When authorized by any provision in Sections 2011 or 2114 of the Corporations Code…as provided by such provision.” (CCP § 416.20(b).) As pertinent here, Corporations Code § 2011(b) states: “Summons or other process against such a corporation may be served by delivering a copy thereof to an officer, director, or person having charge of its assets or, if no such person can be found, to any agent upon whom process might be served at the time of dissolution. If none of those persons can be found with due diligence and it is so shown by affidavit to the satisfaction of the court, then the court may make an order that summons or other process be served upon the dissolved corporation by personally delivering a copy thereof, together with a copy of the order, to the Secretary of State….” Thus, Corporations Code § 2011(b) allows for service on a dissolved corporation through: (1) an officer or director; (2) a person having charge of the corporation’s assets; or (3) any agent upon whom process might be served at the time of dissolution.

With respect to an officer or director, plaintiff attempted to serve defendant’s Chief Executive Officer, Guillaume Zarka, but was unsuccessful. (Robinson Decl. ¶¶ 2, 16 & Exs. 2, 7.) Plaintiff argues that a declaration of diligence was required to be served prior to the request for entry of default. Unlike individuals, no showing of reasonable diligence is necessary for service of summons on corporations. (Compare CCP § 415.20(a) [corporations, including dissolved corporations under Corp. Code § 416.20] with CCP § 415.20(b) [individual persons].)

With respect to service on Pessah, plaintiff contends that service on Pessah was proper because Pessah was in charge of defendant’s assets. Specifically, plaintiff asserts that Pessah represented defendant in a prior lawsuit against, among others, plaintiff, and that, in connection with the prior lawsuit, took control of defendant’s assets. (Lozoya Decl. ¶ 2 & Ex. 6.) Defendant responds by asserting that Pessah’s representation ended in January 2024, before the instant case was filed on 2/13/24. (Pessah Reply Decl. ¶ 2.)

Based on service on Farrace, however, the Court finds it unnecessary to determine whether Pessah was in charge of defendant’s assets for the purpose of determining whether service on him was proper. According to defendant’s most recent Statement of Information filed with the Secretary of State before dissolving, Farrace was listed as the agent for service of process. (Robinson Decl. ¶ 2 & Ex. 2.) Farrace also admits that she served as defendant’s agent for service of process in 2018 and that she continuously served as the registered agent up until when defendant dissolved in 2019. (Farrace Decl. ¶¶ 2-4.) Accordingly, at the time of dissolution, Farrace was the agent upon whom process might be served for the purposes of Corporations Code § 2011(d).

Farrace’s address was stated as 1500 Rosecrans Avenue, Suite 500, Manhattan Beach, CA 90266. (Ibid.) Defendant argues that Farrace was served at a different address—1601 Pacific Coast Hwy #290, Hermosa Beach, CA 90254. Farrace also states that she stopped working at the Manhattan Beach address on 11/1/20 and stopped working at the Hermosa Beach address “a year or so ago.” (Farrace Decl. ¶¶ 7, 9.) Nonetheless, Farrace admits that she received a copy of the summons on 3/11/24, which had been left in the mail room of the Hermosa Beach address. (Farrace Decl. ¶ 11.)

The provisions of the service of process statutes “are now to be liberally construed to effectuate service and uphold jurisdiction if actual notice has been received by the defendant.” (Bein v. Brechtel–Jochim Group, Inc. (1992) 6 Cal.App.4th 1387, 1392.) Corporations Code § 2011(b) does not state that the agent must be served at the address indicated on the Statement of information filed with the Secretary of State. While Farrace was served at an office she purportedly vacated, this is of no moment as Farrace admits to having received the summons. (Farrace Decl. ¶ 11.) As defendant’s agent, Farrace was held “out to the world as authorized to receive notice of actions.” (Pulte Homes Corp. v. Williams Mechanical, Inc. (2016) 2 Cal.App.5th 267, 274.) Consequently, through service on Farrace, defendant had actual notice of the instant action, even though defendant had previously dissolved. (Ibid. [in case of dissolved corporation, “notice to the person designated by the corporation as its agent for service of process is actual notice”].)

For the foregoing reasons, the motion to quash service of summons is DENIED.

In the alternative, defendant moves for an order setting aside the default based on purported lack of actual notice. CCP § 473.5 allows a defaulted party to move to set aside a default when “service of a summons has not resulted in actual notice…to defend the action.” (CCP § 473.5(a).) As long as the lack of actual notice was not caused by the party’s avoidance of service or inexcusable neglect, as supported by affidavit, the Court may set aside the default on terms it deems just. (CCP § 473.5(b), (c).)

As stated above, defendant received actual notice through service on its registered agent Farrace. (Pulte Homes, 2 Cal.App.5th at 274.) Moreover, to the extent that Farrace was unable to contact Zarka after having received the summons and Complaint (Farrace Decl. ¶¶ 11, 12), the Court notes that defense counsel admitted to having received the summons and Complaint on 2/26/24. (Robinson Decl. ¶ 19 & Ex. 10.) Defense counsel responded to plaintiff that he was not authorized to receive service of process. (Robinson Decl. ¶ 20 & Ex. 11.) On 4/10/24, counsel for plaintiff informed defense counsel and Farrace that they had until 4/17/24 to file an answer; otherwise, a request for entry of default would be filed. (Robinson Decl. ¶ 21 & Ex. 12.) Defense counsel apparently sat on the summons and Complaint without filing any motion to quash summons within 30 days after service, as provided in CCP § 418.10(a), and allowed default to be entered against defendant. As plaintiff corresponded with the same defense counsel who filed the instant motion prior to entry of default, defendant cannot credibly it had no actual notice to defend the action.

The motion to set aside entry of default is DENIED.