Judge: Latrice A. G. Byrdsong, Case: 22STLC08672, Date: 2023-12-07 Tentative Ruling

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Case Number: 22STLC08672    Hearing Date: February 26, 2024    Dept: 25

Hearing Date:                         Monday, February 26, 2024

Case Name:                             MERCURY INSURANCE COMPANY v. PAZI PERFORMANCE AUTO CENTER, INC.

Case No.:                                22STLC08672

Motion:                                   Motion for Reconsideration

Moving Party:                         Defendant Pazi Performance Auto Center, Inc.

Responding Party:                   Plaintiff Mercury Insurance Company

Notice:                                    OK

Tentative Ruling:                    Defendant Pazi Performance Auto Center, Inc.’s Motion for Reconsideration is DENIED.

                                                Plaintiff Mercury Insurance Company’s Request for Sanctions is GRANTED in the amount of $850.00.  Defendant is ordered to pay the sanctions within 30 days from notice of this Court’s ruling.

BACKGROUND

On December 29, 2022, Plaintiff Mercury Insurance Company (“Plaintiff”) filed a Complaint against Defendant Pazi Performance Auto Center, Inc. (“Defendant”) and DOES 1 through 50, inclusive for (1) Money Had and Received; and (2) Unjust Enrichment. The Complaint alleges Plaintiff sought reimbursement of a check issued to Defendant to begin repairs on its insured Arnold Klein’s vehicle that was involved in a vehicle collision that was determined to be a total loss.

On August 3, 2023, this Court entered default judgment in Plaintiff’s favor against Defendant.

On November 2, 2023, Defendant filed a Motion to Set Aside the Default Judgment. On December 7, 2023, this Court denied Defendant’s motion and request for leave to properly file its answer.

On December 18, 2023, Defendant filed this instant Motion for Reconsideration. Plaintiff filed its opposition on February 7, 2024. No reply has been filed.

MOVING PARTY POSITION

            Defendant contends it provides clarification and evidence that will support the reversal of the December 7, 2023 Order. Defendant further argues Plaintiff’s service was improper. Moreover, Defendant contends the evidence and writings herein demonstrate Defendant should be allowed to proceed on the merits of the case and default should be set aside.

OPPOSITION

            In Opposition, Plaintiff argues there is no new law cited by Defendant nor any that applies to this circumstance. Furthermore, Plaintiff argues there are no new facts or evidence presented by Defendant to support reconsideration because Defendant was aware of service in February of 2023, when Defendant contacted Plaintiff’s counsel by telephone followed up by an email. Moreover, Plaintiff asserts subsequent communications and emails were exchanged between Defendant and Plaintiff’s counsel June of 2023.

Additionally, Plaintiff argues service was proper because the summons and complaint were served at Defendant’s place of business to an employee who identified themselves as an office manager and the perosn in charge. Plaintiff also asserts discretionary relief is unavailable to Defendant because Defendant knew of the manner of service since August of 2023 and did not mention any challenge to service or issues with “George B.” Lastly, Plaintiff contends Defendant should be sanctioned.

REPLY

None as of 2/21/24.

ANALYSIS

I. Motion for Reconsideration

A.    Legal Standard

Pursuant the Code of Civil Procedure Section 1008, subdivision (a), “[w]hen 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 Civ. Proc., § 1008, subd. (a).)

As it relates to new or different facts, circumstances, or law under Code of Civil Procedure Section 1008, subdivision (a), “the moving party must provide a satisfactory explanation for the failure to produce that evidence at an earlier time.”  (Shiffer v. CBS Corp. (2015) 240 Cal.App.4th 246, 255.) Furthermore, “facts of which the party seeking reconsideration was aware at the time of the original ruling are not “new or different.” (In re Marriage of Herr (2009) 174 Cal.App.4th 1463, 1468.)

B.  Discussion

Timeliness

A formal notice of ruling is required to set the time limit running to file a motion for reconsideration. The 10-day time limit runs from service of notice of entry of the order. (Code Civ. Proc., § 1008, subd. (a).) 

The Court ordered Plaintiff to provide notice of the ruling on December 7, 2023. However, no proof of service or formal notice of ruling has been filed as such to determine whether Defendant’s motion is timely under the statute. Nonetheless, Plaintiff does not contend that this instant motion is untimely in its opposition. Accordingly, the Court will exercise its discretion and rule on the merits.

Motion

Defendant moves for reconsideration of the Order dated December 7, 2023, wherein the Court denied Defendant’s Motion to Set Aside Default Judgment entered on August 3, 2023. (Min. Order 12/7/23.) Thus, Defendant is making this instant motion before the same court that made the subject order.

Here, Defendant contends it was served through a former employee named George B, who was not employed at said time of servicing, thereby making service improper. Defendant further contends George B was a training employee lacking any and all authority to accept service for Defendant.  As such, Defendant asserts the service was issued to an unknown and caused the delayed response to Plaintiff’s Complaint. Defendant also asserts it diligently searched and looked for evidence that was inadvertently excluded in the motion to set aside. Finally, Defendant contends Plaintiff will not experience any prejudice if this present motion is granted but rather Defendant has suffered prejudice due to the fact the service was improperly made to the erred person.

In opposition, Plaintiff argues Defendant has not cited any new facts, circumstances or law that exists to support reconsideration. Plaintiff further argues Defendant has failed to provide any satisfactory explanation for not raising the issue of service before. Plaintiff contends Defendant was aware of the substituted service on “George B” prior to the original motion because Plaintiff’s counsel emailed proof of service to Defendant’s counsel on August 18, 2023. (Thai Decl., ¶ 5, Ex. 4.) Plaintiff also contends Defendant did not at any time state or argue that service was invalid in his original motion. Moreover, Plaintiff argues service was proper because the registered process server went to Defendant’s place of business and handed the summons and complaint to an employee, “George B,” who identified himself as an office manager and the person in charge. (Salgado Decl., ¶¶ 2-3, Ex. 1.) Plaintiff asserts Defendant provides no explanation as to why “George B” was at the business at the time or why he held himself out as authorized to accept service. Plaintiff also asserts there is no admissible evidence to show that George B did not hold himself out as someone ostensibly authorized to receive service on Defendant’s behalf.  Lastly, Plaintiff argues actual notice was given to Defendant because Plaintiff’s counsel had been in contact with a principal of Defendant via telephone and email since February 2023, and such principal sent an email in support of Defendant’s position on February 14, 2023, and remained in communication with Plaintiff’s counsel until at least August 2023 when the default judgment was entered. (Min Thai Decl., ¶¶ 2-5, Exs. 2-4.) Thus, Plaintiff contends Defendant fails to submit any new evidence demonstrating why its delay in retaining counsel or responding to the complaint was excusable.

The Court finds that Defendant has not established a basis for reconsideration of the order denying the motion to set aside default judgment. First, Defendant has failed to show that this present motion is based upon new or different facts, circumstances, or law. Defendant makes no indication that the issue regarding the purported improper service was unknown at the time of the original motion. It appears from arguments set forth in this present motion that Defendant searched for other evidence already known to it but did not include in its original motion to support a reversal of the outcome. Secondly, Defendant does not provide any explanation as to why it failed to produce purported evidence of the improper service during the filing of the original motion. Furthermore, Defendant fails to provide an explanation as to why the person who accepted service on its behalf held themselves out to be the person in charge. Finally, Defendant does not submit any other evidence to support it had no notice of this case or refute Plaintiff’s evidence that Defendant did have notice.

Request for Sanctions

“A violation of this section may be punished as a contempt and with sanctions as allowed by Section 128.7.” (Code Civ. Proc., § 1008, subd. (d).) Pursuant to Code of Civil Procedure Section 128.7, subdivision (c)(1), “A motion for sanctions under this section shall be made separately from other motions or requests and shall describe the specific conduct alleged to violate subdivision (b).” (Code Civ. Proc., § 128.7, subd. (c)(1).)

Plaintiff argues Defendant has provided no new, different or previously unavailable facts as to Defendant’s failure to timely act to set aside the default, thus sanctions are appropriate. Plaintiff requests monetary sanctions against Defendant in the amount of $850.00 for 2.0 hours spent drafting this opposition and time that will be spent on the reply and hearing at an hourly rate of $425.00. (Min Thai Decl., ¶ 7.)

The Court will impose sanctions against Defendant in favor of Plaintiff in the amount of $850.00.

II.        Conclusion

            Accordingly, Defendant Pazi Performance Auto Center, Inc.’s Motion for Reconsideration should be DENIED.

            Plaintiff Mercury Insurance Company’s Request for Monetary Sanctions is GRANTED in the amount of $850.00. Defendant is ordered to pay the sanctions within 30 days from notice of this Court’s ruling.

The Moving Party is ordered to give notice.