Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 200 

 

 

BACKGROUND 

This case arises from a dispute over rental income from vacation properties.  Defendant Joel Liebke owns and operates a property management firm, assisting property owners in renting out luxury vacation homes throughout California.  Plaintiff Peter Deschner owns a home in Palm Springs, California (the “Palm Springs Property”).   

Defendant, through his firm, began leasing the Palm Springs Property to third parties, but failed to obtain the required permits from the City of Palm Springs.  As a result, the City fined Plaintiff and imposed a lifetime rental ban on Plaintiff.  Plaintiff sued one of Defendant’s entities – Luxury Rental Group, Inc. (“LRG”) – for breach of contract and tortious conduct.  The parties entered into a written settlement agreement for $60,000 to be paid out over nine months.  LRG made the first payment and then declared Chapter 7 Bankruptcy. 

Plaintiff also owns property in Venice, California (the “Venice Property”).  Plaintiff and Defendant entered into an exclusive written property management agreement granting Defendant the right to lease the Venice Property to prospective renters.  As consideration for his services, Defendant was to receive 25% of gross booking revenue.  From December 26, 2018 through January 6, 2019, Defendant rented the Venice Property to third parties.  After commissions, Plaintiff was to receive $12,081.05 in net rental income.  Plaintiff has yet to receive his share of the rental income.   

The operative first amended complaint (“FAC”) alleges claims for (1) violation of Penal Code §496(c), (2) conversion, (3) fraudulent inducement and (4) breach of contract.   

The Court previously denied a motion to set aside default by Defendant.  The Court concluded, among other things, that Defendant’s motion was procedurally defective because it failed to include a proposed answer and was supported by a declaration from counsel that lacked personal knowledge and contained inadmissible hearsay.  While Defendant attempted to correct these defects in a reply, the Court did not consider the reply as it was untimely filed and contained new evidence.   

This hearing is on Defendant’s motion for reconsideration or in the alternative, for renewal of the motion to set aside entry of default judgment.  Defendant argues that new or different facts support the granting of the motion for reconsideration including that (1) the Court sua sponte considered Defendant’s conduct in failing to retain counsel sooner and purportedly evading deposition when the facts do not support such a finding, and (2) the Court failed to consider Defendant’s reply to the motion to set aside default which corrected the errors noted in the Court’s order, including by attaching a proposed answer and a declaration from Defendant that attested to the facts previously found only in counsel’s defective declaration.        

TIMELINESS¿ 

A motion for reconsideration must be filed “within 10 days after service upon the party of written notice of entry of the order.”  Code Civ. Proc. 1008(a).  The Court’s minute order denying the motion to set aside was served by mail with a certificate of mailing dated April 3, 2023.  Pursuant to Civ. Proc Code §1013(a), the time to file the motion for reconsideration is extended by five calendar days where service of the order was made by mail.  Accordingly, the motion for reconsideration is due by April 18, 2023.  Defendant filed the instant motion on April 17, 2023, and accordingly, his motion is timely.     

LEGAL STANDARD¿ 

Pursuant to¿Code of Civil Procedure Section 1008(a): 

"When an application for an order has been made to a judge, or to a court, and refused in whole or in part, or granted, or granted conditionally, or on terms, any party affected by the order may, within 10 days after service upon the party of written notice of entry of the order and based upon new or different facts, circumstances, or law, make application to the same judge or court that made the order, to reconsider the matter and modify, amend, or revoke the prior order. The party making the application shall state by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown." (Code of Civ. Proc., §1008(a).) 

As stated by the court in¿Gilberd v. AC Transit (1995) 32 Cal. App. 4th 1494, 1499, a court acts in excess of jurisdiction when it grants a motion to reconsider that is not based upon “new or different facts, circumstances or law.”  There is a strict requirement of diligence, meaning the moving party must present a satisfactory explanation for failing to provide the evidence, different facts, or law earlier.¿(Garcia v. Hejmadi (1997) 58 Cal. App. 4th 674, 690.)  A motion for reconsideration was properly denied where it was based on evidence that could have been presented in connection with the original motion.  (Morris v. AGFA Corp. (2006) 144 Cal.App.4th 1452, 1460;¿Hennigan v. White (2011) 199 Cal.App.4th 395, 406.) 

Further, on a motion for renewal, “a party who originally made an application for an order which was refused in whole or part, or granted conditionally or on terms, may make a subsequent application for the same order upon new or different facts, circumstances, or law, in which case it shall be shown by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown.”  (Code Civ. Proc. section 1008, subdivision (b).) 

DISCUSSION  

Defendant bemoans that the Court failed to consider his reply, which corrected the errors in his motion by attaching a proposed answer and a declaration by Defendant.  However, Defendant’s reply was not timely filed, and the Court was well within its authority to disregard the reply.  (Cal. Rules of Court, rule 3.1300(d).)  Defendant’s reply was due on March 27, and was not filed until March 30.  The Court noted the untimeliness of Defendant’s reply in its minute order: “Defendant did attach a copy of an answer to his reply, but that reply was filed late without leave to do so.”  (4/3/2023 Minute Order at p. 3.)  

Further, a reply cannot submit new evidence.  (Jay v. Mahaffey (2013) 218 Cal.App.4th 1522, 1537-1538¿(under general rule of motion practice,¿new evidence is not permitted with reply papers and is only allowed in exceptional cases).)  Defendant’s submission of a new declaration from Defendant was new evidence, which deprived Plaintiff of the ability to challenge the new matter. 

Defendant does not offer any excuse for the filing of the untimely and improper reply.  While Defendant claims that the failure to attach a proposed answer and his declaration to the original motion was the product of his attorney’s mistake, he does not similarly provide a reason for the untimely filed reply.      

Defendant also argues that the Court sua sponte considered Defendant’s litigation conduct based on untrue assumptions from Plaintiff’s Opposition and these assumptions were in any event not material to the determination of whether a motion to set aside default should be granted.  But the Court did not sua sponte consider Defendant’s conduct; as Defendant himself concedes, these issues were raised in the Opposition, and to the extent Defendant disagreed with the characterization of his conduct, he could have corrected any mischaracterizations in a timely filed reply.  That Defendant wants a do-over on his motion and reply is not a new or different fact warranting reconsideration or renewal.     

The Court also disagrees that Defendant’s conduct – in failing to retain counsel sooner and evading a deposition -- is not material to a motion to set aside default.  The conduct was part of the Court’s consideration of whether Defendant’s motion to set aside default was part of an overall strategy to thwart prompt resolution of the case.  In overseeing the conduct of proceedings before it, the Court may properly consider whether a motion is being filed to unnecessarily delay proceedings.  (McClain v. Kissler (2019) 39 Cal.App.5th 399, 424 (to grant relief to litigants who delay the case in getting to trial “invites other litigants to ignore the laws and rules and renders the process unfair to most other litigants and counsel who endeavor to comply with them”).)  A trial court has the “‘inherent discretion to¿control the¿proceedings to ensure the efficacious administration of justice.’” (People v. Gonzalez¿(2006) 38 Cal.4th 932, 951.)   

Defendant now argues he was not attempting to delay resolution of the case.  Defendant attests he did not receive notice of the amended complaint (filed on August 19, 2022), which he claims was served on the wrong address.  He also claims he was mistakenly informed by counsel that there was nothing to worry about and the only item pending was an OSC for dismissal scheduled for March 2023.  It was only after he formally retained counsel in January 2023 to represent him at the OSC did counsel discover the amended complaint and the entry of default judgment.  Defendant also attests he was not evading a deposition; he claims he never talked with Plaintiff about scheduling a deposition.  Even assuming these facts are true, they could have been raised earlier in a timely filed reply.   

“New or different facts” under 1008(b) does not mean simply offering “anything not previously presented to the court” because that would have “[t]he miserable result … [of] defeat[ing] the Legislature’s stated goal of reducing the number of reconsideration motions and would remove an important incentive for parties to efficiently martial their evidence.”  (Garcia v. Hajmadi (1997) 58 Cal.App.4th 674, 689.)  

In reply, Defendant argues that the new matter was the fact his original motion was defective and was the product of his attorney’s error.  Defendant’s argument proves too much.  It would mean that a motion for reconsideration should be granted every time counsel failed to properly include evidence or arguments in the original motion because that failure was new matter.  That cannot be the law.   

The cases cited by Defendant do not stand for such a sweeping proposition.  Defendant cites to Elston v. City of Turlock (1985) 38 Cal.3d 227 and Bettencourt v. Los Rios Community College Dist. (1986) 42 Cal.3d 270.  Neither case involved a motion for reconsideration, nor did they hold, as Defendant argues here, that a failure to properly include evidence in an original motion constitutes new matter.       

In sum, there are no new or different facts that could not have been timely raised in the original proceedings which would warrant either the grant of a motion for reconsideration or a motion for renewal.   

CONCLUSION 

Based on the foregoing, the Court denies Defendant’s motion for reconsideration or in the alternative, for renewal of the motion to set aside default.   

 

DATED: May 18, 2023 ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court