Judge Lee W. Tsao, Case Number: 22NWCV01776, Date: 2024-02-21 Tentative Ruling

Judge: Lee W. Tsao, Case: 22NWCV01776, Date: 2024-02-21 Tentative Ruling

Case Number: 22NWCV01776 Hearing Date: February 21, 2024 Dept: C

Cancino, et al. v. rios, et al.

CASE NO.: 22NWCV01776

HEARING: 2/21/24 @ 9:30 AM

Defendants’ Motion to Set Aside Default and Default Judgment is GRANTED.

Moving Party to give NOTICE.

Defendants Yone Aracely Lopez Rios, Jose E. Rodriguez, Tequila B.A.R. General, Inc. (Tequila Bar), and Los Lopez Tequila B.A.R. & Spirits, Inc. (Los Lopez) (collectively Defendants) move to set aside default and the resulting default judgment pursuant to CCP § 473(b).

Background

Plaintiffs Jose Alvaro Cancino and Angelica Garcilazo Madrigal (collectively Plaintiffs) allege that Defendant sold worthless shares of stock to Plaintiffs in Tequila Bar and Los Lopez. Plaintiffs claim that Tequila Bar and Los Lopez were inactive corporations. Plaintiffs filed a Complaint against Defendants alleging causes of action for:

1. Breach of Contract (against Tequila Bar, Rios, and Rodriguez)

2. Fraud (against all Defendants)

3. Conversion (against all Defendants)

4. Violation of Penal Code § 496 (against all Defendants)

5. Declaratory Relief (against all Defendants)

Legal Standard

Discretionary and mandatory relief is available to parties from “judgment, dismissal, order, or other proceeding taken against him or her.” (CCP § 473(b).) Discretionary relief is available under the statute as “the court may, upon any terms as may be just, relieve a party or his or her legal representative from judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. (CCP § 473(b).) Alternatively, mandatory relief is available when “accompanied by an attorney’s sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect.” (CCP § 473(b).) Under this statute, an application for discretionary or mandatory relief must be made no more than six months after entry of the judgment, dismissal, order, or other proceeding from which relief is sought. (CCP § 473(b); English v. IKON Business Solutions (2001) 94 Cal.App.4th 130, 143.)

Discussion

Here, Default was entered against each Defendant on March 1, 2023. Defendants filed their Motion to Set Aside Default on August 31, 2023, which is within the six months allowed by CCP § 473. “‘[W]hen relief under section 473¿is¿available, there is a strong public policy in favor of granting relief and allowing the requesting party his or her day in court … [Citation.]” (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 981-82.) Thus, there is strong public policy in favor of granting Defendants’ Motion to Set Aside Default.

Default judgment against Defendants is set aside because Defendants’ counsel’s excusable neglect of failing to file a responsive pleading while preparing for trials in other matters. Defendants’ counsel states that he failed to calendar the date to file a responsive pleading. (Valenzuela Decl., ¶ 4.) Further, at the time counsel was retained, he was preparing for trials set to begin on February 8, 2023 and February 14, 2023. (Valenzuela Decl., ¶¶ 5-6.) Thus, Defendants’ counsel’s neglect was excusable within the meaning of CCP § 473(b) and the strong public policy in favor of determination on the merits weighs in favor of setting aside the default. Therefore, Defendants’ Motion to Set Aside Default is granted. Additionally, Default Judgment is set aside because the Entry of Default is set aside.

Accordingly, Defendants’ Motion to Set Aside Default and Default Judgment is GRANTED.