Judge: Lisa R. Jaskol, Case: 22STCV05161, Date: 2024-04-16 Tentative Ruling

Case Number: 22STCV05161    Hearing Date: April 16, 2024    Dept: 28

Having considered the documents submitted in support of a default judgment, the Court rules as follows. 

BACKGROUND 

On February 2, 2022, Plaintiff Amir Guerami (“Plaintiff”) filed this action against Defendants Flat Rate Moving Systems, LLC (“Flat Rate”), Roee Einhorn (“Einhorn”), Ilan Ron (“Ron”), and Does 1-50 for breach of contract, breach of implied-in-fact contract, intentional misrepresentation, negligent misrepresentation, trespass to chattels, and conversion. 

On July 12, 2022, Defendants Flat Rate, Einhorn, and Ron filed an answer.  

Also on July 12, 2022, Flat Rate filed a cross-complaint against Cross-Defendants Echo Global Logistics, Inc. (“Echo”) and Roes 1-20 for indemnification, apportionment of fault, and declaratory relief. 

On September 2, 2022, Echo filed an answer to Flat Rate’s cross-complaint. 

On April 20, 2023, Flat Rate amended the cross-complaint to include Cross-Defendant A1 Transportation Network, Inc. (“A1”) as Roe 1. 

On June 13, 2023, the Court dismissed Echo without prejudice at Flat Rate’s request. 

On June 23, 2023, Flat Rate filed a proof of service showing personal service of the summons, cross-complaint, and other documents on A1 on June 12, 2023.  On September 6, 2023, Flat Rate filed another proof of service. 

On September 12, 2023, the clerk entered A1’s default. 

On October 25, 2023, the Court dismissed Plaintiff’s complaint with prejudice at his request. 

On December 14, 2023, Flat Rate submitted a proposed judgment on its cross-complaint against A1.  On December 18, 2023, Court staff informed Flat Rate’s counsel that before the Court could consider the default judgment submitted to the Court, Flat Rate was required to submit a Request for Court Judgment on form CIV-100 and a declaration in support of entry of default judgment. 

On January 31, 2024, Flat Rate filed a request for Court judgment on form CIV-100.  

Also on January 31, 2024, Flat Rate filed a statement of damages requesting $85,000.00 in general damages for indemnification on its cross-complaint against A1. 

On February 2, 2024, Flat Rate filed an application for default judgment, a declaration by counsel, and another proposed judgment. 

On February 14, 2024, Court staff directed Flat Rate’s counsel to submit a proposed judgment on Judicial Council form JUD-100 and a request to dismiss Roes 2-20. 

On February 21, 2024, Flat Rate submitted a JUD-100 form. 

On February 26, 2024, the Court dismissed Roes 2-20 from Flat Rate’s cross-complaint with prejudice. 

On March 15, 2024, Court staff again directed Flat Rate’s counsel to submit a CIV-100 form. 

On April 5, 2024, Flat Rate filed another application for default judgment and supporting declaration by counsel.  On April 11, 2024, Flat Rate filed another CIV-100 form. 

PARTY’S REQUEST 

Flat Rate asks the Court to enter a default judgment against A1 and award Flat Rate $85,000.00 in special damages. 

LEGAL STANDARD 

A.      Default judgment 

“[With exceptions that do not apply here,] [a] party seeking a default judgment on declarations must use mandatory Request for Entry of Default (Application to Enter Default) (form CIV-100) . . . The following must be included in the documents filed with the clerk: 

“(1)  Except in unlawful detainer cases, a brief summary of the case identifying the parties and the nature of plaintiff's claim; 

“(2)  Declarations or other admissible evidence in support of the judgment requested; 

“(3)  Interest computations as necessary; 

“(4)  A memorandum of costs and disbursements; 

“(5)  A declaration of nonmilitary status for each defendant against whom judgment is sought; 

“(6)  A proposed form of judgment; 

“(7)  A dismissal of all parties against whom judgment is not sought or an application for separate judgment against specified parties under Code of Civil Procedure section 579, supported by a showing of grounds for each judgment; 

“(8)  Exhibits as necessary; and 

“(9)  A request for attorney fees if allowed by statute or by the agreement of the parties.” 

(Cal. Rules of Court, rule 3.1800(a).) 

B.       Damages 

The relief granted to a plaintiff upon entry of a defendant's default cannot exceed the amount demanded in the complaint or, for personal injury cases where damages may not be stated in the complaint, the amount listed in the statement of damages. (Code Civ. Proc., §§ 580, subd. (a), 585, subd. (b).) “The notice requirement of section 580 was designed to insure fundamental fairness.” (Becker v. S.P.V. Construction Co. (1980) 27 Cal.3d 489, 494.) The statute insures that “defendants in cases which involve a default judgment have adequate notice of the judgments that may be taken against them. [Citation.] ‘If a judgment other than that which is demanded is taken against him, [the defendant] has been deprived of his day in court—a right to a hearing on the matter adjudicated.’ ’’ (Id. at p. 493.) A trial court exceeds its jurisdiction if it awards damages in excess of the amount specified in the complaint or statement of damages. (Id. at p. 494.) 

DISCUSSION 

          “Defaulting parties have a constitutional right to adequate notice of the maximum judgment that may be assessed against them.”  (L. Edmon & C. Karnow, Cal. Practice Guide: Civil Procedure Before Trial (Rutter 2023) ¶ 5:250, p. 5-66 (Cal. Practice Guide).)  Here, the cross-complaint does not state the amount of damages which Flat Rate sought against the Cross-Defendants.  Flat Rate asserts that it served its statement of damages on A1 on January 30, 2024.  (Application p. 3.) 

As a result, when the clerk entered A1’s default on September 12, 2023, A1 had not received notice of the maximum amount of damages that could be assessed against it.  “[B]efore a default may be entered, plaintiff must serve defendant with a statement of ‘the nature and amount of damages being sought.’ ” (Cal. Practice Guide, supra, ¶ 5:82, p. 5-27.)  “[S]ervice [of the statement of damages] after default but before prove-up is not sufficient.”  (Ibid.)  “The purpose is to give defendant ‘one last chance’ to respond, knowing exactly what judgment may be entered if he or she fails to appear.”  (Id., ¶ 5:83, p. 5-28.)  

These rules apply to cross-complaints for indemnity and contribution.  (Cal. Practice Guide, supra, ¶ 5:86:10, p. 5-30.)  A statement of damages is required “even where there has been no settlement and the cross-complainants therefore do not know the precise amount of damages for which indemnity is sought against the defaulting [cross-]defendant.  In such a case, the [statement of damages] should estimate the amount of damages that [plaintiff] may recover.”  (Id., ¶ 5:86:11, p. 5-30.) 

Because A1 did not receive notice of the damages which might be assessed against it before the clerk entered A1’s default, the Court denies Flat Rate’s application for default judgment and vacates the clerk's September 12, 2023 entry of A1's default. 

CONCLUSION

 The Court DENIES Cross-Complainant Flat Rate Moving Systems, LLC’s application for default judgment against Cross-Defendant A1 Transportation Network, Inc. 

The Court VACATES the clerk’s September 12, 2023 entry of Cross-Defendant A1 Transportation Network, Inc.’s default. 

The Court sets an OSC re: Status of Entry of Default on May 30, 2024 at 8:30 a.m. in Department 28 of the Spring Street Courthouse. 

Moving party is ordered to give notice of this ruling.