Judge: Joseph Lipner, Case: 23STCV03899, Date: 2023-12-06 Tentative Ruling

Case Number: 23STCV03899    Hearing Date: December 6, 2023    Dept: 72

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

Plaintiff Dixon-Shane, LLC (“Plaintiff”) seeks an entry of default judgment against Defendant Flash Servicing Company, Inc. (“Defendant”).

Plaintiff requests:

(1)  money judgment in the amount of $824,141.98;

(2)  pre-judgment interest in the amount of $51,841.92;

(3)  attorney’s fees in the amount of $6,945.00; and

(4)  costs of litigation in the amount of 676.24.

Plaintiff’s request for default judgment is GRANTED. The Court ORDERS Plaintiff’s counsel to return the Confession of Judgment to counsel for Defendant upon satisfaction of this judgment and file a proof of service with the Court. 

Background

This dispute arises out of a written Wholesaler Application/Credit Application under which Defendant purchased pharmaceuticals from Plaintiff on credit. Plaintiff and Defendant entered into a Settlement and Release Agreement (the “Agreement”) on September 29, 2021, under which Defendant agreed to pay $1,425,150.63 to Plaintiff over time. Defendant also entered into a Confession of Judgment which stipulated that, if Defendant failed to perform on the Agreement, Plaintiff could file the Confession of Judgment with a court and obtain judgment entered according to its terms.

Defendant underpaid its payments which were due on October 28, 2021 and November 28, 2021 and missed its December 2021 payment entirely.

On February 22, 2023, Plaintiff filed this action, raising claims for (1) breach of contract; and (2) declaratory judgment. Plaintiff named Defendant in the complaint, as well as naming Doe defendants 1 through 10.

On July 10, 2023, the Court entered default against Defendant.

On September 25, 2023, Plaintiff filed the current request for default judgment.

Legal Standard

CCP § 585 permits entry of a judgment after a Defendant has failed to timely answer after being properly served.  A party seeking judgment on the default by the Court must file a Form CIV-100 Request for Court Judgment, and:

(1) Proof of service of the complaint and summons;

(2) A dismissal of all parties against whom judgment is not sought (including Doe defendants) or an application for separate judgment under CCP § 579, supported by a showing of grounds for each judgment (CRC 3.1800(a)(7);

(3) A declaration of non-military status as to the defendant (typically included in Form CIV-100) (CRC 3.1800(a)(5));

(4) A brief summary of the case (CRC 3.1800(a)(1));

(5) Admissible evidence supporting a prima facie case for the damages or other relief requested (Johnson v. Stanhiser (1999) 72 Cal.App.4th 357, 361-362);

(6) Interest computations as necessary (CRC 3.1800(a)(3));

(7) A memorandum of costs and disbursements (typically included in Form CIV-100 (CRC 3.1800(a)(4));

(8) A request for attorney’s fees if allowed by statute or by the agreement of the parties (CRC 3.1800(a)(9)), accompanied by a declaration stating that the fees were calculated in accordance with the fee schedule as per Local Rule 3.214.  Where a request for attorney fees is based on a contractual provision the specific provision must be cited; (Local Rule 3.207); and

(9) A proposed form of judgment (CRC 3.1800(a)(6));

(10) Where an application for default judgment is based upon a written obligation to pay money, the original written agreement should be submitted for cancellation (CRC 3.1806). A trial court may exercise its discretion to accept a copy where the original document was lost or destroyed by ordering the clerk to cancel the copy instead (Kahn v. Lasorda's Dugout, Inc. (2003) 109 Cal.App.4th 1118, 1124);

(11) Where the plaintiff seeks damages for personal injury or wrongful death, they must serve a statement of damages on the defendant in the same manner as a summons (Code Civ. Proc. § 425.11, subd. (c), (d)).

(California Rules of Court rule 3.1800.)

Pursuant to Code Civ. Proc., § 1033.5(a)(1), items are allowable as costs under Section 1032 if they are “filing, motion, and jury fees.”

A party who defaults only admits facts well pleaded in the complaint or cross-complaint.  (Molen v. Friedman (1998) 64 Cal.App.4th 1149, 1153-1154.)  Thus, the complaint must state a claim for the requested relief.

Discussion

Service of the Complaint and Summons

Defendant was served with the Complaint on March 27, 2023 by substituted service on a receptionist at its place of business. (Troupson Decl. ¶ 5, Exh. 1.)

Dismissal of Other Parties

The Doe defendants were dismissed from the action on September 26, 2023, pursuant to Plaintiff’s request.

Non-Military Status

Plaintiff avers to the non-military status of Defendant in the submitted Form CIV-100.

Summary of the Case

Plaintiff provides a brief summary of the case in its Brief Statement of the Case. Plaintiff adequately pleads its causes of action in the Complaint.

Evidence of Damages

In the event that Defendant failed to timely make any payment, Plaintiff had the right under the Agreement to accelerate the remaining payments and seek the outstanding balance in court. (Fraley Decl. ¶ 14.) Billie Fraley avers that the outstanding amount under the Agreement is $824,141.98. (Fraley Decl. ¶ 13.)

Interest

The Complaint requests interest on the unpaid amount. (Complaint  p. 6:18.) The amount of principal damages is certain because it is laid out in the loan agreements; pre-judgment interest is therefore permissible here.

Theresa M. Troupson provides the interest calculation. (Troupson Decl. ¶ 13-14.) The total interest is $51,841.92.

Memorandum of Costs and Disbursements

Plaintiff includes a memorandum of costs in the submitted Form CIV-100, averring that it expended $676.24 in costs.

Attorney’s Fees

          Plaintiff requests $6,945.00 in attorney’s fees. The Agreement provides that the prevailing party in an action arising out of the Agreement or the Confession of Judgment shall be entitled to reasonable attorney’s fees and costs of litigation. (Fraley Decl., Exh. 1 at p. 6.)

          This is an action on a contract. Because the judgment is over $100,000, the maximum recovery of attorney’s fees is equal to $2,890 plus 1% of the excess over 100,000. (Local Rule 3.214.) The excess over $100,000 here is $ 724,141.98. 1% of that amount is $7,241.42. Thus, the maximum amount of attorney’s fees is $10,131.42. Plaintiff’s request is within this amount. The Court therefore grants Plaintiff’s request for attorney’s fees.

Proposed Form of Judgment

          Plaintiff provides a proposed form of judgment consistent with the above.

Submission of the Written Agreement

          California Rule of Court 3.1806 states that “unless otherwise ordered” judgment upon a written obligation requires a clerk’s note across the face of the writing that there has been a judgment. Here, Plaintiff has not submitted the original documents. The Court does not discern any practical need for such a clerk’s note on the written obligation in the current case and therefore orders that it need not be included. If this causes any issues for any party or non-party they are authorized to bring the matter to the Court’s attention. 

Statement of Damages

No statement of damages is required because this is not a personal injury or wrongful death case.