Judge: Deirdre Hill, Case: 21TRCV00835, Date: 2022-08-02 Tentative Ruling

Case Number: 21TRCV00835    Hearing Date: August 2, 2022    Dept: M

Hearing Date:                          August 2, 2022

Moving Parties:                      (1) Defendant Lin Jiang, (2) defendant Shen Li Gong

Responding Party:                  Plaintiff Kevin Dobalian (as to Gong’s motion only)

(1)   Motion to Set Aside Default and Default Judgment

(2)   Motion to Set Aside Default and Default Judgment

            The court considered the moving and opposition papers.

RULING

            Defendant Lin Jiang’s motion to set aside and vacate default is GRANTED.  The March 11, 2022 default is set aside and vacated.  Defendant is ordered to file an answer within five days.

Defendant Shen Li Gong’s motion to set aside and vacate default is GRANTED.  The March 11, 2022 default is set aside and vacated.  Defendant is ordered to file  responsive pleading within five days. 

BACKGROUND

On November 10, 2021, plaintiff Kevin Dobalian, ind. and dba South Bay Massage College filed a complaint against Yanfen Wang, Sheng Li Gong, Lin Jiang, and Rudy A. Lopez for (1) intentional interference with contractual advantage, (2) fraud, (3) conspiracy to defraud, (4) extortion, (5) conspiracy to extort, and (6) declaratory and injunctive relief against fraudulent and unfair business practices.  Plaintiff alleges that this is a lawsuit brought by the owner of a long-established massage school against certain of the school’s graduates and others, known and unknown, who unlawfully, willfully, and knowingly attempted to extort money from the school’s owner.  When the school’s owner refused to tender the funds, defendants attempted to extort him to heed to their financial demands or risk having to close the business he had built over the past 23 years.  Defendants’ extortion included filing false complaints against the school with the MBPD, the IRS, and the State of California agency that regulates the school; posting libelous statements on social media sites; making slanderous statements to newspaper reporters, who then placed those statements in widely read newspapers; organizing, publicizing, and conducting large demonstrations at the school and at the owner’s private residence; unlawfully occupying school offices and destroying school property; conspiring with more than 50 other graduates to file small claims actions against the school; and sending WeChat messages and other forms of communications to more than 100 additional graduates, encouraging them to join the conspiracy to extort funds from the school’s owner. 

On March 11, 2022, defaults were entered against Lin Jiang and Sheng Li Gong.

LEGAL AUTHORITY

CCP §473(b) states, in part:  ““The court may, upon 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. . . .”

CCP §473.5(a) states, in relevant part:  “When service of a summons has not resulted in actual notice to a party in time to defend the action and a default or default judgment has been entered against him or her in the action, he or she may serve and file a notice of motion to set aside the default or default judgment and for leave to defend the action. The notice of motion shall be served and filed within a reasonable time, but in no event exceeding the earlier of:  (i) two years after entry of a default judgment against him or her; or (ii) 180 days after service on him or her of a written notice that the default or default judgment has been entered.”

The phrase “actual notice” means “genuine knowledge of the party litigant” and does not include constructive or imputed notice to the client.  Tunis v. Barrow (1986) 184 Cal. App. 3d 1069, 1077.

CCP §473.5(b) requires that “a notice of motion to set aside a default or default judgment and for leave to defend the action shall designate as the time for making the motion a date prescribed by subdivision (b) of Section 1005, and it shall be accompanied by an affidavit showing under oath that the party’s lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect.  The party shall serve and file with the notice a copy of the answer, motion, or other pleading proposed to be filed in the action.”

CCP §473.5(c) allows “upon a finding by the court that the motion was made within the period permitted by subdivision (a) and that his or her lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect, it may set aside the default or default judgment on whatever terms as may be just and allow the party to defend the action.”

“[A] default judgment entered against a defendant who was not served with a summons in the manner prescribed by statute is void.”  Dill v. Berquist (1994) 24 Cal. App. 4th 1426, 1444.  “Where a party moves under section 473(d) to set aside ‘a judgment that, though valid on its face, is void for lack of proper service, the courts have adopted by analogy the statutory period for relief from a default judgment’ provided by section 473.5, that is, the two-year outer limit.”  Trackman v. Kenney (2010) 187 Cal. App. 4th 175, 180 (citations omitted).  “Thus, defendant cannot assert under section 473(d) that the judgment, although facially valid, is void for lack of service.”  Id. at 181.

DISCUSSION

Motion to vacate (Lin Jiang)

Under CCP §473(b), defendant Lin Jiang (self-represented) requests that the court set aside the default entered on March 11, 2022.

Defendant acknowledges that she was personally served on December 3, 2021 with the summons and complaint.  She filed and served a “response” to the complaint on December 20, 2021 titled “Memorandum in Support of Special Motion to Strike, Pursuant to CCP §425.16, Anti-SLAPP Motion.”  She contends that she had believed that filing the “memorandum” was a “valid Answer” and that she did not know that there were legal requirements, such as captioning the document “Answer.”  See Lin Jiang decl.  She attaches a proposed answer to her motion.

On March 10, 2022, at the CMC and OSC for failure to file request for entry of default, defendant appeared.  The minute order reflects that the court noted that defendant had filed a document on December 20, 2021 with a hearing date of March 10, 2022, but that defendant did not reserve a hearing date via the Court Reservation System, did not file a notice of motion, and that there was no proof of service.  The court noted that defendant may re-file the document with the required reservation and supporting paperwork for a future date of her choosing. 

A default was entered the next day on March 11, 2022.

No opposition was filed.

The court finds that defendant has met her burden that the default was the result of her mistake, inadvertence, surprise, or excusable neglect.

The motion is thus GRANTED.

Motion to Vacate (Sheng Li Gong)

Under CCP §§473(b) and 473.5(b), defendant Sheng Li Gong (self-represented) requests that the court set aside the default entered on March 11, 2022.

The proof of service filed on December 20, 2021 indicates that defendant was substitute served at 3153 Stichman Avenue, Baldwin Park, CA 91706 on December 15, 2021, on “Liqun Wu Co-Occupant” by a registered process server.  The declaration of due diligence states that on December 4, 2021, the process server was told “he did not live here.” 

Defendant asserts that defendant did not have actual notice in time to defend and that he was not properly served.  He states that he was not living at the address on Stichman in Baldwin Park and that he had already moved out on the date that they purportedly substitute served him.  He said that prior to moving out, he was renting a room at the address on Stichman and did not have any relationships with the other occupants and thus, the person served could not have known where he moved to provide him with the summons and complaint.  He attached a copy of a “Standard Reservation Agreement” dated November 27, 2021 showing that the lease date began on December 1, 2021 at an address in Chino, CA.

In opposition, plaintiff argues that defendant was properly served because on December 10, 2021, he received a written notification from the U.S. Post Office at the Baldwin Park branch that Gong’s current mailing address was the Stichman address.  Plaintiff also received a written notification on July 18, 2022 that Gong’s current mailing address was the Stichman address.

The court finds that although it appears that defendant was substitute served at his usual mailing address under CCP §415.20(b), defendant has met his burden that he did not have actual notice in time to defend the action and that his lack of notice was not caused by his avoidance of service or inexcusable neglect.

The motion is thus GRANTED.

Plaintiff is ordered to give notice of ruling.