Judge Holly J. Fujie, Case Number: BS168107, Date: 2024-10-16 Tentative Ruling

This action stems from a long-standing dispute between Petitioner and Respondent, who are brothers and former business partners. Together, they operated Pacific M. International Corp. dba PMI diamonds (“PMI”), a wholesale diamond business. The parties thereafter had disagreements related to PMI’s management and finances and they agreed to submit their dispute to binding arbitration.

The first arbitration regarding PMI’s dissolution took place over the second half of 2016. In December 2016, the parties received a binding order after arbitration in favor of Petitioner. (Request for Judicial Notice [“RJN”], Exh. A.) The parties thereafter agreed to submit to further binding arbitration in April 2017, as the result of which the arbitrators issued an Amended Binding Order (the “Award”) in favor of Petitioner for $9,018,291. (RJN, Exh. B.)

On October 11, 2017, this Court confirmed the Award and entered judgment in favor of Petitioner (the “Judgment”).

On September 6, 2024, Respondent filed the instant Motion to Set Aside Judgment and Permit the Filing of a Cross-Complaint (the “Motion”). Petitioner filed an opposition to the Motion on October 3, 2024, and Respondent filed a reply on October 8, 2024.

Petitioner objects to the two Declarations of Isaac Musighi filed in support of Respondent’s Motion. The objection is SUSTAINED.

Petitioner’s request for judicial notice is GRANTED. (Evid. Code § 452(d) and (h).)

A trial court has broad discretion to vacate a judgment, dismissal, default judgment or entry of default that preceded it. (Code Civ. Proc., § 473.) That discretion can only be exercised, however, if the moving party establishes a proper ground for relief, uses the proper procedure and acts within the time limit set by the statute. (Cruz v. Fagor America, Inc. (2007) 146 Cal.App.4th 488, 495.) A party may seek discretionary or mandatory relief from¿default¿under CCP § 473(b) on grounds of “mistake, inadvertence, surprise or excusable neglect.”

A motion to set aside¿under CCP § 473(b) must be brought within six (6) months of the entry of the order or judgment; this requirement is jurisdictional. (Code Civ. Proc., § 473(b).) The Judgment was entered on October 11, 2017, yet Respondent did not file the Motion until almost seven years had passed, i.e., on September 6, 2024 – long after the jurisdictional limitations period of six months had expired. The Motion is therefore untimely insofar as it is brought under CCP § 473(b).

Respondent argues that rather than being bound by the 6-month jurisdictional time limit of CCP § 473(b), he is entitled to proceed with the Motion because there is no such time limit for filing a motion under Section 473(d), which requires a showing of extrinsic fraud. Respondent contends that Petitioner’s extrinsic fraud rendered the underlying Judgment void and warrants setting it aside, even though it was entered in Petitioner’s favor seven years ago. Respondent asserts that “Petitioner’s misconduct severely compromised the arbitration process” and that Respondent “was deprived of a reasonable opportunity to present his case fully,” which “tainted the entire proceeding, rendering the arbitration’s outcome fundamentally flawed.” (Motion, p. 11.)

To support his claims of fraud, Respondent enumerates a string of allegedly fraudulent activities carried out by the Petitioner. (Motion, pp. 5-6.) These alleged activities, however, are related to issues that were already settled or could have been resolved during the arbitration proceedings seven years ago. Respondent does not offer any evidence to support the assertion that the Judgment confirming the arbitration Award was obtained through fraud. Thus, there are no grounds upon which the Court may set aside the Judgment as void.

Having considered the Motion and Respondent’s contentions regarding alleged fraud by Petitioner, the Court finds that there is no valid basis for Respondent’s claim that the Judgment is void due to fraud and therefore subject to being set aside under CCP § 473(d). The Motion is untimely under CCP § 473(b). The Court therefore finds that there is no basis under the law to find that the Judgment should be vacated or that Respondent should be given leave to file a Cross-Complaint in this action.

Parties who intend to submit on this tentative must send an email to the Court at SMC_DEPT56@lacourt.org as directed by the instructions provided on the court website at www.lacourt.org. If the department does not receive an email and there are no appearances at the hearing, the motion will be placed off calendar.

Hon. Holly J. Fujie

Judge of the Superior Court