Judge: Elaine Lu, Case: 18STCV06544, Date: 2023-03-08 Tentative Ruling





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Case Number: 18STCV06544    Hearing Date: March 8, 2023    Dept: 26

18STCV06544

Cross-Complainants’ Proposed Entry of Default Judgment submitted on February 22, 2023 is granted in part in a reduced amount for the following reasons:

 

Principal Damages

“If the complaint does not state a cause of action or the allegations do not support a claim for relief, a default judgment is erroneous and ‘cannot stand.’”  (Grappo v. McMills (2017) 11 Cal.App.5th 996, 1015.) “It is well established a default judgment cannot properly be based on a complaint which fails to state a cause of action against the party defaulted because, as Witkin explains, ‘[a] defendant who fails to answer admits only facts that are well pleaded.’ Because the third amended complaint alleged no facts with respect to Kondo, there were no facts for Kondo to admit.”  (Falahati v. Kondo (2005) 127 Cal.App.4th 823, 829.)

 

Here, the Operative Second Amended Cross-Complaint fails to allege all necessary elements for a claim of breach of the January 24, 2018 claim against Cross-Defendant Otis Cooper. 

 

“The elements of a cause of action for breach of contract are: ‘(1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff.’”  (Coles v. Glaser (2016) 2 Cal.App.5th 384, 391 [internal citations omitted].)  “A contract is an agreement to do or not to do a certain thing.”  (Civ. Code, § 1549.)  The essential elements of a contract are parties capable of contracting; their consent; a lawful object; and a sufficient cause or consideration.  (Civ. Code, § 1550.) 

 

Here, the Second Amended Cross-Complaint fails to allege what each party’s obligations were under the contract entered into on January 24, 2018.  Nor does the Second Amended Cross-Complaint allege any consideration that Cross-Complainants rendered in exchange for Otis Cooper providing the $25,000.00 in the Production Agreement with Red Velvet Entertainment and thus the no consideration for the later guarantee through Legal Investments LLC to provide collateral.  (See e.g., SACC ¶¶ 25, 99.)  There is no allegation of what Otis Cooper received in exchange for the $25,000.00 he was supposed to provide.  Nor does the Second Amended Cross-Complaint allege performance by Cross-Complainants so as to entitle them to Cooper’s performance of his obligations.  Accordingly, the additional $175,000.00 in damages cannot be awarded based on the allegations in the Second Amended Cross-Complaint.

 

Attorney’s Fees

Cross-Complainants failed to request attorneys fees in their request for default judgment, and attorneys fees cannot subsequently be granted.  “[A] default judgment is intended to include all relief sought in the complaint and established by the plaintiff. Therefore, a plaintiff seeking an award of attorney fees from a defaulting defendant must request those fees at the time the plaintiff requests entry of default.”  (Garcia v. Politis (2011) 192 Cal.App.4th 1474, 1480.)

 

Punitive Damages

 

To obtain punitive damages, Plaintiff or Cross-Complainant must have served a statement of damages (setting forth the amount of punitive damages requested) before entry of default.  (Service must be in the same manner as a summons.)  This may be included as part of a CCP 425.11 statement of damages in a personal injury/wrongful death case.  (CCP 425.115(e)-(g)).   Here, Cross-Complainants failed to file and serve any statement of damages prior to entry of default.  Consequently, Cross-Complainants are precluded from claiming punitive damages.

 

Moreover, before the Court may award punitive damages, Cross-Complainants must present some evidence to allow evaluation of the effect of the punitive damages award on the Cross-Defendant such that the punitive damages award is not excessive in light of defendant’s ability to pay.  (See Adams v. Murakami (1991) 54 Cal.3d 105, 114;  Lara v. Cadag (1993) 13 Cal.App.4th 1061, 1065 [meaningful evidence required and “evidence of earnings is not by itself sufficient.”];  Green v. Laibco, LLC (2011) 192 Cal.App.4th 441, 452-54 [evidence of a defendant’s profit during the most recent twelve-month period, and evidence of defendant’s positive net worth, constituted the required meaningful evidence of financial condition, or of the profitability of the defendant's conduct]; Cummings Medical Corp. v. Occupational Medical Corp. (1992) 10 Cal. App. 4th 1291, 1300 [applying Adams, supra, to a default prove-up; some measure of the effect of a punitive damages award in terms of deterrence is required before punitive damages may be awarded in a default judgment]; Johnson v. Ford Motor Co. (2005) 35 Cal.4th 1191, 1208 [calculating punitive damages in an individual tort case based on profits gained may produce an excessive award when there are multiple similar torts].) 

 

Here, Cross-Complainants have failed to present any evidence of the effect of any punitive damages award on Cross-Defendant.  Cross-Complainants have thus failed to demonstrate that any punitive damages award is not excessive in light of Cross-Defendant’s ability to pay, in conformity with the above authorities.

 

Costs

The vast majority of costs that Cross-Complainants have listed were costs incurred in pursuing the action against the other Cross-Defendant Miranda Chen, who proceeded to trial.  None of the filing and motion fees, jury fees, deposition costs, court-ordered transcripts, or court reporter fees were incurred to pursue the instant default judgment.  Accordingly, the only costs that the court will award against Cross-Defendant Cooper are the service of process costs of $772.45.

 

Conclusion

 

Cross-Complainants’ request for entry of default judgment is GRANTED in the following reduced amount:  

 

$300,000.00 (Principal Damages shown)

+ $772.45 (Costs)

= $300,772.45 Total

 


The full amount of the $300,772.45 judgment shall be jointly and severally liable with the other Cross-Defendants per the jury’s verdict.

 

Cross-Complainant is ordered to file and serve a separate proposed judgment on form JUD-100 for Otis Cooper identifying the amounts above for principal damages and costs.  The following language must be set forth in paragraph 7 of the JUD-100: "Any credit on one judgment shall apply to all judgments in this case."”

 

Cross-Complainant is ordered to file proof of service of this order.