Judge David A. Rosen, Case 22GDCV00477 2022-12-30 Tentative Ruling

Judge: David A. Rosen, Case: 22GDCV00477, Date: 2022-12-30 Tentative Ruling

Case Number: 22GDCV00477 Hearing Date: December 30, 2022 Dept: E

Hearing Date: 12/30/2022 – 8:30am
Case No. 22GDCV00477
Trial Date: UNSET
Case Name: LORRAINE MARIE CARUSO v. ALMA VICTORIA SIMPSON, indiv; and DOES 1-10

TENTATIVE RULING– MOTION TO SET ASIDE DEFAULT

Moving Party: Defendant, Alma Victoria Simpson
Responding Party: Plaintiff, Lorraine Marie Caruso

RELIEF REQUESTED¿
Defendant, Alma Victoria Simpson, moves the Court for an order setting aside the default.

Procedural
16/21 Day Lapse (CCP §12c and §1005(b): Ok
Proof of Service Timely Filed (CRC, Rule 3.1300): Ok
Correct Address (CCP §1013, §1013a): No – The instant motion to set aside default, memorandum of points and authorities, and declaration of Mason Yost was served via email to “dpersoff@persofflaw.com”. On eCourt, the email address for Plaintiff’s counsel is listed as “office@persofflaw.com”. However, since Plaintiff filed an Opposition, it appears as if Plaintiff received this motion. At the hearing, counsel shall confirm the appropriate email address for service.

Opposition submitted, no reply submitted.

BACKGROUND
On 08/02/2022, Plaintiff filed a complaint alleging the following causes of action: (1) Breach of Contract, (2) Common Count – Money Lent, and (3) Financial Elder Abuse.

On 09/30/2022, Plaintiff requested entry of default of Defendant, and on 09/30/2022, the Court entered default of Defendant.

On 10/04/2022, Defendant filed an answer.

On 10/19/2022, Defendant moved for an order to set aside the default.

LEGAL STANDARD – MOTION TO SET ASIDE DEFAULT
CCP §473(b) states as follows:

The 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. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken. However, in the case of a judgment, dismissal, order, or other proceeding determining the ownership or right to possession of real or personal property, without extending the six-month period, when a notice in writing is personally served within the State of California both upon the party against whom the judgment, dismissal, order, or other proceeding has been taken, and upon his or her attorney of record, if any, notifying that party and his or her attorney of record, if any, that the order, judgment, dismissal, or other proceeding was taken against him or her and that any rights the party has to apply for relief under the provisions of Section 473 of the Code of Civil Procedure shall expire 90 days after service of the notice, then the application shall be made within 90 days after service of the notice upon the defaulting party or his or her attorney of record, if any, whichever service shall be later. No affidavit or declaration of merits shall be required of the moving party. Notwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney’s sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorney’s mistake, inadvertence, surprise, or neglect. The court shall, whenever relief is granted based on an attorney’s affidavit of fault, direct the attorney to pay reasonable compensatory legal fees and costs to opposing counsel or parties. However, this section shall not lengthen the time within which an action shall be brought to trial pursuant to Section 583.310.

(CCP §473(b).)

Further, Carmel, LTD. v. Tavoussi sheds further light on CCP §473(b):

Section 473, subdivision (b), authorizes the trial court to relieve a party from a default judgment entered because of the party's or his or her attorney's mistake, inadvertence, surprise, or neglect. The section provides for both mandatory and discretionary relief. Mandatory relief is available “whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney's sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect ....” (§ 473, subd. (b).) “[I]f the prerequisites for the application of the mandatory provision of section 473, subdivision (b) exist, the trial court does not have discretion to refuse relief.” (Leader v. Health Industries of America, Inc. (2001) 89 Cal.App.4th 603, 612, 107 Cal.Rptr.2d 489 (Leader ).) Thus, to the extent that the applicability of the mandatory relief provision does not turn on disputed facts, but rather, presents a pure question of law, it is subject to de novo review. (Ibid.) Where the facts are in dispute as to whether or not the prerequisites of the mandatory relief provision of section 473, subdivision (b), have been met, we review the record to determine whether substantial evidence supports the trial court's findings. (See Howard v. Owens Corning (1999) 72 Cal.App.4th 621, 631, 85 Cal.Rptr.2d 386 [findings of fact reviewed for sufficiency].) Evidence is substantial when it is of “ ‘ “ponderable legal significance,” ’ ” reasonable, credible, and of solid value. (Ibid.)

“The ‘attorney fault’ language was added to section 473 in 1988. Prior to that time, a litigant who suffered a default or default judgment due to inexcusable attorney error could only obtain relief if he or she could persuade the court that counsel's behavior amounted to ‘total abandonment’ of the client; otherwise attorney conduct that was ‘simply inexcusable’ fell between the two poles and provided no basis for relief. [Citation.] The amendments were clearly designed to fill this gap. The purpose was threefold: to relieve the innocent client of the consequences of the attorney's fault; to place the burden on counsel; and to discourage additional litigation in the form of malpractice actions by the defaulted client against the errant attorney.” (Solv–All v. Superior Court (2005) 131 Cal.App.4th 1003, 1009, 32 Cal.Rptr.3d 202 (Solv–All ).) But the mandatory provision of section 473, subdivision (b), “protects only the innocent client [and] provides no relief for the culpable client who participates in conduct which led to the default....” (Lang v. Hochman (2000) 77 Cal.App.4th 1225, 1251–1252, 92 Cal.Rptr.2d 322 (Lang ).) If the trial court finds that the moving party's misconduct was a contributing cause of the default, that party “cannot rely on the mandatory relief provision of section 473.” (Lang, at p. 1252, 92 Cal.Rptr.2d 322.)

(Carmel, Ltd. v. Tavoussi (2009) 175 Cal.App.4th 393, 399-400.)

“The range of attorney conduct for which relief can be granted in the mandatory provision is broader than that in the discretionary provision, and includes inexcusable neglect. But the range of adverse litigation results from which relief can be granted is narrower. Mandatory relief only extends to vacating a default which will result in the entry of a default judgment, a default judgment, or an entered dismissal.” (Leader v. Health Industries of America, Inc. (2001) 89 Cal.App.4th 603, 616.)

ANALYSIS
Here, moving Defendant appears to be seeking relief under the mandatory provision since Defendant’s counsel filed an attorney affidavit of fault.

In the declaration of Yost (Defendant’s counsel), Yost says that he made an error as to when the responsive pleading was due because he calculated the responsive pleading to be due on October 6, 2022, and he filed the Answer on October 4, 2022. (See Decl. Yost ¶3.) Yost states that as a result of his calendaring error, he is now filing the motion to set aside default. (Decl. Yost ¶4.) Yost further states that his client, Defendant, is in no way at fault for this situation. (Decl. Yost ¶7.)

Plaintiff argues that the motion to set aside the default should not be granted because the calendaring error by Plaintiff’s attorney has not been shown to have actually caused the default. Plaintiff cites Todd v. Thrifty Corp. (1995) 34 Cal.App.4th 986, 991. Plaintiff then argues:

Defendant’s declaration of Attorney Mason Yost is the only evidence offered in support of the Motion to set aside default. It states a calendaring error, but not that Defendant ever asked Mr. Yost to file a responsive pleading. Mr. Yost states that his client (Defendant Alma Victoria Simpson) acknowledged the debt and said that it will be paid in full. (Defendant’s Yost Dec. par. 5). Mr. Yost states that after he learned of the service of the Summons and Complaint, he miscalculated the last day to file a responsive pleading and that he submitted an answer on October 4, 2022, after the default had been entered. He does not say that his client asked him to file an answer prior to the default having been entered on September 30, 2022. If the attorney was not asked to file an answer before it was due, his calendaring error did not actually cause any loss to the client. Defendant’s counsel also did not immediately move to set aside the default when the Answer was rejected due to a default having been entered. (The Motion of Defendant for relief from default was served by email on October 19, 2022). Counsel waited 15 days to file a motion and did not even call opposing counsel to state that the motion was going to be forthcoming.

It is reasonable for Simpson to have not wanted to oppose the case because she admitted the debt —why should she want to incur fees for an attorney to prepare an answer, as well as the filing fee for filling it with the court? The court should not make an assumption that the alleged error in calendaring actually caused the default.

There are other facts stated in the Motion which suggest that Mr. Yost was not asked to do anything in this case. Mr. Yost states that he had several phone calls with Plaintiff's attorney Dan Persoff before the Complaint was filed but does not state that any call was made to Mr. Persoff after Mr. Yost found out about the filing of the Complaint. Logically if Mr. Yost was involved and his client wanted to pay the debt, a call would have been made to counsel for Plaintiff to make arrangements for payment, or a payment plan, or a settlement agreement, or an extension to plead to work out any details, etc. There was nothing — suggesting that there was no retention and no plans for counsel to do anything.

(Pl. Mot. p.2- 3)

The Court finds Plaintiff’s arguments unavailing.

First, Plaintiff’s citation to Todd v. Thrifty Corp. (1995) 34 Cal.App.4th 986 is not persuasive. Plaintiff doesn’t accurately give the full context of Todd. Plaintiff leaves out the following portion of Todd that is factually distinguishable from this case:

In this case, the evidence filed simultaneously with the motion to vacate the dismissal (i.e., the first declaration of plaintiff's counsel) was to the effect that the failure to comply with discovery obligations and the court's order was attributable primarily to plaintiff's personal problems. Although a calendaring error caused plaintiff's counsel to miss the hearing on Thrifty's motion to dismiss, we find no basis for concluding that his presence would have altered the outcome.⁵ Thus, to the extent plaintiff's counsel made any mistakes, in calendaring the hearing or otherwise, they did not “actually cause” the dismissal.

Further, the evidence filed the day before the second hearing on the motion to vacate (i.e., the supplemental declaration of plaintiff's counsel) *992 was, in the words of Rogalski v. Nabers Cadillac, supra, “the attorney ... covering up for the client.” (11 Cal.App.4th at p. 821.) Having attributed the dismissal to plaintiff's personal problems at the first hearing, counsel could not thereafter attempt to change the facts and blame himself. (Cf. Hoover Community Hotel Development Corp. v. Thomson (1985) 167 Cal.App.3d 1130, 1141-1142 [213 Cal.Rptr. 750] [in summary judgment context, declarant's prior statement is binding despite subsequent conflicting statement; prior statement destroys all credibility of subsequent statement].) The trial court should have disregarded counsel's supplemental declaration.

Because plaintiff's counsel's mistakes, if any, did not cause the dismissal of the lawsuit, the trial court abused its discretion in vacating the dismissal.

(Todd v. Thrifty Corp. (1995) 34 Cal.App.4th 986, 991-992.)

Here, counsel has not tried to change the facts by submitting different declarations with different reasons as to why the instant default should be set aside. Defendant’s counsel has stated one reason for setting aside the default – because he made a calendaring error.

Further, Plaintiff’s argument that, “Mr. Yost states that his client acknowledged the debt and said that it will be paid in full,” as grounds for denial of setting aside default is unpersuasive. The Yost declaration states, “Prior to the filing of the summons and complaint in this matter, I had several phone calls with Plaintiff attorney, Dan Persoff. We also exchanged correspondence regarding the instant dispute. I told him my client acknowledged the debt and would repay in full.” (Decl. Yost ¶5.) This argument is unpersuasive because Plaintiff relies on Defendant’s counsel’s statement allegedly said by the client, which is hearsay. Further, even if this statement is assumed to be true, this admission does not automatically lead to default.

Opposition argues that Yost’s declaration does not state that Defendant ever asked Mr. Yost to file a responsive pleading; therefore, if the attorney was not asked to file an answer before it was due, his calendaring error did not actually cause any loss to the client. This argument is asinine and relies on a strained reading of the Yost declaration which explicitly states, “As a result of my calendaring error, the Motion to Set Aside Default is being filed at this time.” (Decl. Yost ¶4.) Further, the Yost declaration states, “My client, Defendant Alma Victoria Simpson, is in no way at fault for this situation. She should not be penalized for my mistake.” (Decl. Yost ¶7.) Defendant has submitted evidence by means of the Yost declaration that the late answer and resultant default was due to Defendant’s counsel. There is no evidence submitted by either party to suggest otherwise.

Further, Plaintiff’s counsel’s citation to Del Junco v. Hufnagel (2007) 150 Cal.App.4th 789, 800 is inapposite.

Finally, the 15 days between Defendant’s filing of his Answer and the filing of this motion was not unreasonable and does not justify denying this motion.

TENTATIVE RULING
Motion to set aside default is GRANTED. The Answer that Defendant already has on file remains the operative answer in this case.

Sanctions
Plaintiff argues that the Court should order Defendant’s counsel to pay reasonable compensatory legal fees to Plaintiff of $2,100.00 for reasonable attorneys fees incurred to prepare the default prove up, incurred prior to the service of the motion or any communication that it was forthcoming, per CCP 473(b).

Plaintiff’s counsel’s declaration states:

I had had a dialogue with Mr. Yost about the subject debt prior to filing of the subject . Complaint, but when the dispute did not settle, I stopped hearing from him. Following the service of the Summons and Complaint on Plaintiff, I did not receive any communication from Defendant Alma Victoria Simpson, attorney Mason Yost, or anyone on behalf of Defendant. After the default of Simpson had been entered, I was served by email by Mr. Yost with a proposed Answer, but he did not advise me that he was intending to move to set aside the default. The motion to set aside default, came by email on October 19, 2022. As of October 13, 2022, not having heard anything, I began to Prepare the documents for prove up of a money judgment for Plaintiff. The only work that was 20 remaining to be done after I received the emailed Motion for relief from default, was completion of the Memorandum of Costs by my legal assistant, who prepared an itemization of the costs incurred. (Decl. Persoff ¶2.)

Since I had not heard from Defendant’s counsel at that time, on October 13, 2022, I began preparing the papers for entry of a default judgment by court. I spent 2.0 hours on October 13, 2022, on drafting the Memorandum and supporting declarations in support of default prove up. On October 17, 2022, I did an additional 2.7 hours of work on the memorandum and declarations in support of the prove up. On October 18, 2022, I spent .90 hours drafting the Civ.-100 form to request entry of judgment by court, request for dismissal of Doe Defendants, and proposed Judgment. On October 19, 2022 I received by email, the Motion to Set Aside Default of Defendant. Prior to receiving the motion to set aside the default, I had spent 5.6 hours on preparing the documents for default prove up. My regular and reasonable hourly rate, which the client is being charged in this case, is $375.00 per hour. Plaintiff has incurred charges of 5.6 hours at $375.00 per hour for my preparing the default prove up papers. for a total of $2,100.” (Decl. Persoff ¶3.)

CCP 473(c) states:

“(c) (1) Whenever the court grants relief from a default, default judgment, or dismissal based on any of the provisions of this section, the court may do any of the following:

(A) Impose a penalty of no greater than one thousand dollars ($1,000) upon an offending attorney or party.

(B) Direct that an offending attorney pay an amount no greater than one thousand dollars ($1,000) to the State Bar Client Security Fund.

(2) However, where the court grants relief from a default or default judgment pursuant to this section based upon the affidavit of the defaulting party’s attorney attesting to the attorney’s mistake, inadvertence, surprise, or neglect, the relief shall not be made conditional upon the attorney’s payment of compensatory legal fees or costs or monetary penalties imposed by the court or upon compliance with other sanctions ordered by the court.”

As the Request for Entry of Default appears to the Court to have resulted from a bilateral failure to communicate between counsel, no sanctions are awarded.