Judge Kerry Bensinger, Case Number: 24STCV32345, Date: 2025-05-15 Tentative Ruling

This is a breach of contract action. On May 1, 2025, Plaintiff, Headway Capital, LLC filed (1) application for an order directing service of summons on defendant Paul Moorhead (“Moorhead”) by publication, and (2) application for order for service of process on California Secretary of State on behalf of defendant Angel City Woodshop, Inc. (“Angel City”).

Where a defendant cannot with reasonable diligence be served in any manner specified in Code of Civil Procedure sections 415.10 through 415.40, a plaintiff may seek an order for service by publication. Code of Civil Procedure section 415.50 provides, in pertinent part: “A summons may be served by publication if upon affidavit it appears to the satisfaction of the court in which the action is pending that the party to be served cannot with reasonable diligence be served in another manner specified in this article and that either: (1) A cause of action exists against the party upon whom service is to be made or he or she is a necessary or proper party to the action. (2) The party to be served has or claims an interest in real or personal property in this state …” (Code Civ. Proc., § 415.50, subd. (a).) “When substituted or constructive service is attempted, strict compliance with the letter and spirit of the statutes is required.” (Olvera v. Olvera (1991) 232 Cal.App.3d 32, 41.)

“For the purpose of service by publication, the existence of a cause of action is a jurisdictional fact.” (Harris v. Cavasso (1977) 68 Cal.App.3d 723, 726; Code Civ. Proc., § 415.50, subd. (a) [requiring that a “cause of action exists against the party upon whom service is to be made.”])

“Diligence is a relative term and must be determined by the circumstances of each case. The question is one for the trial court in the first instance.” (Vorburg v. Vorburg (1941) 18 Cal.2d 794, 797.) “If the facts set forth in the affidavit have a legal tendency to show the exercise of diligence on behalf of the plaintiff in seeking to find the defendant within the state, and that after the exercise of such diligence [she or] he cannot be found, the decision of the judge that the affidavit shows the same to his satisfaction is to be regarded with the same effect as is [her or] his decision upon any other matter of fact submitted to [her or] his judicial determination.” (Id.)

Plaintiff seeks an order allowing service of summons on Moorhead by publication in the Los Angeles Daily Journal. Despite diligent efforts, Plaintiff has been unable to serve Moorhead.

Upon review of Plaintiff’s application and supporting declaration, the court is not satisfied with Plaintiff’s showing of diligence. Plaintiff engaged the services of process serving company, Advanced Attorney Services, Inc., to effectuate service of summons and complaint at a business address located at 1021 S. Fairfax Ave, Los Angeles, CA 90019. Advanced Attorney Services reported that the address was a bad address. (See McGrew Decl., ¶¶ 4-5.) However, Plaintiff does not detail any other efforts undertaken to locate other addresses to effectuate service on Moorhead. Plaintiff does not demonstrate “that the party to be served cannot with reasonable diligence be served in another manner specified in this article[.]” (Code Civ. Proc., § 415.50, subd. (a).)

Corporations Code section 1702, subdivision (a) also provides the following: If an agent for the purpose of service of process has resigned and has not been replaced or if the agent designated cannot with reasonable diligence be found at the address designated for personally delivering the process, or if no agent has been designated, and it is shown by affidavit to the satisfaction of the court that process against a domestic corporation cannot be served with reasonable diligence upon the designated agent by hand in the manner provided in Section 415.10, subdivision (a) of Section 415.20 or subdivision (a) of Section 415.30 of the Code of Civil Procedure or upon the corporation in the manner provided in subdivision (a), (b) or (c) of Section 416.10 or subdivision (a) of Section 416.20 of the Code of Civil Procedure, the court may make an order that the service be made upon the corporation by delivering by hand to the Secretary of State, or to any person employed in the Secretary of State’s office in the capacity of assistant or deputy, one copy of the process for each defendant to be served, together with a copy of the order authorizing such service. Service in this manner is deemed complete on the 10th day after delivery of the process to the Secretary of State.¿

Plaintiff has not satisfied the requirements of Corporations Code section 1702. Plaintiff offers the declaration of his counsel who states in pertinent part: “The Summons and Complaint were given to Advanced Attorney Services, Inc. to complete service on defendant by serving: Paul Moorhead, an individual, agent for service ANGEL CITY WOODSHOP, INC., a corporation, at 1021 S Fairfax Ave Los Angeles, CA 90019, the address registered with the California Secretary of State at the time of lawsuit preparation and filing (Exhibit A). [¶] Our process server states that a [sic] the given address is a visibly vacant suite. Both subjects are unknown. (Exhibit B). [¶] Attempts to reach defendant business and/or its agent and/or officers by phone or email have not yielded any results. [¶]. Google searches for ANGEL CITY WOODSHOP, INC., a corporation yield no new address information. [¶] Process against this corporation cannot be completed even though reasonable and due diligence has been exercised to do so” (McGrew Decl., ¶¶ 4-7.)

This showing is insufficient. A declaration in support of a request to serve a corporation must demonstrate “a domestic corporation cannot be served with reasonable diligence upon the designated agent by hand in the manner provided in Section 415.10, subdivision (a) of Section 415.20 or subdivision (a) of Section 415.30 of the Code of Civil Procedure or upon the corporation in the manner provided in subdivision (a), (b) or (c) of Section 416.10 or subdivision (a) of Section 416.20 of the Code of Civil Procedure.”

Construing the prior version of the statute with similar requirements, the Court of Appeal in Batte v. Bandy (1958) 165 Cal.App.2d 527 found that “said provisions are given meaning and effect if they are construed as requiring, as a condition precedent to the issuance of an order for such substituted service, a showing by affidavit that the corporation cannot be served with the exercise of due diligence in any other manner provided by law.” (Id. at 535.) Interpreting Corporations Code section 1702(a), courts have held “[w]e do not believe the Legislature intended to require a less effective method of service upon a corporation when a more effective method is available, or to require the courts or the Secretary of State to participate in such service except as a ‘last resort’ after a party has exhausted other authorized procedures.” (Gibble v. Car-Lene Research, Inc. (1998) 67 Cal.App.4th 295, 312.) “Only if it can show it cannot accomplish service by one of these methods [enumerated in Corporations Code section 1702] is a party required to seek the assistance of the court and the Secretary of State in obtaining jurisdiction over such a corporate defendant.” (Ibid.)

Here, Plaintiff has not demonstrated an inability to serve Angel City’s agent for service, defendant Moorhead, via personal or substitute service at his residence. (Code Civ. Proc., §§ 415.10(a); 415.20(a).) Plaintiff has not demonstrated any attempt to serve Angel City by mailing an acknowledgment and receipt, (Code Civ. Proc. § 415.30(a)), or via any other individual employed by Angel City with the titles enumerated in Code of Civil Procedure section 416.10(b): “A summons may be served on a corporation by delivering a copy of the summons and the complaint by any of the following methods: . . . To the president, chief executive officer, or other head of the corporation, a vice president, a secretary or assistant secretary, a treasurer or assistant treasurer, a controller or chief financial officer, a general manager, or a person authorized by the corporation to receive service of process.” Plaintiff must demonstrate exhaustion of all alternative methods of service enumerated in Corporations Code section 1702 before service upon the Secretary of State may be properly authorized. (Gibble, supra, 67 Cal.App.4th at p. 312; Batte, supra, 165 Cal.App.2d at p. 535.)

The application for service of process on the California Secretary of State is Denied Without Prejudice.

Kerry Bensinger

Judge of the Superior Court

[1] The court also notes Plaintiff’s application for service of process on the California Secretary of State is not supported by a memorandum of points and authorities. If Plaintiff again seeks service of process on the Secretary of State after exhausting other authorized service procedures, Plaintiff must support its application with argument and citation to the law. Failure to do so will result in either a continuance or denial of such an application.