Judge: Michael E. Whitaker, Case: 21STCV30099, Date: 2022-12-13 Tentative Ruling

Case Number: 21STCV30099    Hearing Date: December 13, 2022    Dept: 32

PLEASE NOTE:   Parties are encouraged to meet and confer concerning this tentative ruling to determine if a resolution may be reached.  If the parties are unable to reach a resolution and a party intends to submit on this tentative ruling, the party must send an email to the Court at sscdept32@lacourt.org indicating that party’s intention to submit.  The email shall include the case number, date and time of the hearing, counsel’s contact information (if applicable), and the identity of the party submitting on this tentative ruling.  If the Court does not receive an email indicating the parties are submitting on this tentative ruling and there are no appearances at the hearing, the Court may place the motion off calendar or adopt the tentative ruling as the order of the Court.  If all parties do not submit on this tentative ruling, they should arrange to appear in-person or remotely (which is highly encouraged).  Further, after the Court has posted/issued a tentative ruling, the Court has the inherent authority to prohibit the withdrawal of the subject motion and adopt the tentative ruling as the order of the Court. 

TENTATIVE RULING

MOTION

            Defendant County of Los Angeles (Defendant) moves to set aside the Clerk of the Court’s entry of default on October 25, 2021.  Plaintiff Timothy Andrew Farfan (Plaintiff) opposes the motion.  Defendant replies.  Plaintiff objects to Defendant’s reply and files a sur-opposition.

ANALYSIS

Per Code of Civil Procedure section 473, subdivision (b), a court “may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect.” In addition, a court must vacate a default or dismissal when a motion for relief under Section 473, subdivision (b) is filed timely and accompanied by an attorney’s sworn affidavit attesting to the attorney’s mistake, inadvertence, surprise or neglect “unless the court finds that the default or dismissal was not in fact caused by the attorney’s mistake, inadvertence, surprise or neglect.”  (Code Civ. Proc., § 473, subd. (b).)  

The party or the legal representative must seek such relief “within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken.” (Code Civ. Proc., § 473, subd. (b); see Rappleyea v. Campbell (1994) 8 Cal.4th 975, 980 [“because more than six months had elapsed from the entry of default, and hence relief under section 473 was unavailable”]; People v. The North River Ins. Co. (2011) 200 Ca.App.4^th 712, 721 [motion for relief under section 473 must be brought “within a reasonable time, in no case exceeding six months”]).  “The six-month limit is mandatory; a court has no authority to grant relief under section 473, subdivision (b), unless an application is made within the six-month period.”  (Arambula v. Union Carbide Corp. (2005) 128 Cal.App.4th 333, 340, citations omitted.) 

Here, the Clerk of the Court entered default as to Defendant on October 25, 2021. 

Defendant filed this motion on September 22, 2022, approximately 11 months after the Clerk of the Court’s entry of default.  Accordingly, the Court finds Defendant’s motion to set aside the Clerk of the Court’s entry of default to be untimely. 

            Defendant argues that Defendant’s counsel reasonably believed Defendant was not in default because Plaintiff’s counsel did not provide notice that Defendant would be defaulted, Defendant’s Answer was “processed”, and no request for default was shown on the Court’s docket when the Answer was filed.  (Declaration of Lillian C. Harwell, ¶¶ 3-6, 11; Declaration of Marie L. Wrigthen, ¶¶ 3-4.)

            In opposition, Plaintiff asserts that Defendant’s counsel was advised three times in November 2021 and again in July of 2022, that Defendant had been defaulted.  (Declaration of Ramin Soofer, ¶¶ 19, 21, 22, 23, Exhibit F, H, I, J.).

            In reply, Defendant again highlights the Answer was processed by the Court’s clerk, the Answer was not rejected, and Plaintiff did not move to strike the Answer.  Thus, Defendant assumed the Answer was operative. 

            Further Defendant proffers two new arguments in support of their motion to set aside default in their reply: (1) Plaintiff took the entry of default without notice pursuant to Fasuyi v. Permatex Inc. (2008) 84 Cal. Rptr. 3d 351; see also LaSalle v. Vogel (2019) 36 Cal. App. 5th 127, and (2) Defendant’s request for equitable relief.

            Plaintiff objects to these two new arguments as an improper and untimely introduction of new evidence in support of Defendant’s reply thereby denying Plaintiff due process to reply to the new testimony pursuant to San Diego Watercrafts, Inc., v. Wells Fargo Bank (2002) 102 Cal.App.4th 308, 31.  However as Plaintiff has advanced a sur-opposition addressing Defendant’s new arguments and evidence on the merits, the Court shall exercise its discretion to consider Defendant’s reply as a whole.

            First, Defendant argues that Plaintiff failed to warn Defendant or its counsel of record that a default was about to be taken, which is in itself grounds for the Court to grant relief from the default.  (See Fasuyi v. Permatex Inc. (2008) 167 Cal.App.4th 681; see also LaSalle v. Vogel (2019) 36 Cal.App.5th 127.).  However, as Plaintiff notes in his sur-opposition Fasuyi and LaSalle are inapplicable here because in both cases the Defendant moved to set aside default within the applicable six month time period and thus the Court retained jurisdiction to rule on the issue, whereas here Defendant has not sought to set aside until nearly 11 months after the initial entry of default.

            Second, Defendant contends an extrinsic mistake occurred which resulted in the Court’s entry of default.  Based upon that mistake, Defendant claims he is entitled to equitable relief, and requests the Court to exercise its power in equity to grant relief.

“Apart from any statute, courts have the inherent authority to vacate a default and default judgment on equitable grounds such as extrinsic fraud or extrinsic mistake. “Extrinsic fraud usually arises when a party is denied a fair adversary hearing because he has been ‘deliberately kept in ignorance of the action or proceeding, or in some other way fraudulently prevented from presenting his claim or defense.’ ” In contrast, the term “extrinsic mistake” is “broadly applied when circumstances extrinsic to the litigation have unfairly cost a party a hearing on the merits. [Citations.] ‘Extrinsic mistake is found when [among other things] ... a mistake led a court to do what it never intended....’ ” ”  (Bae v. T.D. Service Co. (2016) 245 Cal.App.4th 89, 97-98, citations omitted; accord Rappleyea, supra, at p. 981 [“After six months from entry of default, a trial court may still vacate a default on equitable grounds even if statutory relief is unavailable”].) 

Further, the Bae court held that “A party may seek equitable relief from a default and default judgment by filing a motion in the pertinent action or initiating an independent action. “[A] motion brought to do so may be made on such ground even though the statutory period [for relief under Code of Civil Procedure section 473, subdivision (b) ] has run.” Because a motion for equitable relief is “direct,” rather than “collateral,” extrinsic fraud or mistake may be demonstrated by evidence not included in the judgment roll or record relating to the judgment.”  (Bae, supra, at p. 98, citations omitted.)   

“[R]elief under the doctrine of extrinsic mistake is subject to a “stringent three-part formula.  . . .  “ ‘[t]o set aside a [default] judgment based upon extrinsic mistake one must satisfy three elements. First, the defaulted party must demonstrate that it has a meritorious case. Second [ ], the party seeking to set aside the default must articulate a satisfactory excuse for not presenting a defense to the original action. Last[ ], the moving party must demonstrate diligence in seeking to set aside the default once ... discovered.’ ” ”  (Bae, supra, at p. 100, citations omitted; see also Rappleyea, supra, at p. 982 [equitable relief should be granted in only exceptional circumstances].)   

            Thus, the Court will address Defendant’s claim under the three-prong test. 

Has Defendant demonstrated that he has a meritorious defense?  The short answer is Yes.  Defendant states that at the time of the accident, it is undisputed that Plaintiff was jaywalking.  The Court finds this fact to have a high likelihood in mitigating Defendant’s potential liability in the underlying case.  

Has Defendant articulated a satisfactory excuse for not seeking timely relief from default?  The short answer is No.  Plaintiff emails to Defendant’s counsel, notifying them several times of the entry of default, was sufficient to put Defendant on notice of the entry of default.  Further, it is unreasonable to conclude solely based on the Court’s processing of the Answer, that said Answer was operative, even in light of the several warnings that a default had previously been entered.

Has Defendant demonstrated diligence in seeking relief from the default once discovered?  The short answer is No.  Similar to the second prong, Defendant does not proffer sufficient evidence to explain why it took nearly eleven months to move to set aside default in light of the numerous warning signs that default had been entered against it.   

As the California Supreme Court in Rappleyea has noted, equitable relief should only be granted in exceptional circumstances.  Here, Defendant has failed to offer an adequate explanation as to why it did not move to set aside default earlier.  The Court does not find Defendant sequence of events to add up especially to the equitable relief sought. Thus, Defendant has failed to demonstrate that it is entitled to such relief under Rappleyea v. Campbell and Bae v. T.D. Service Co.  Specifically, Defendant has not met all 3 prongs of the applicable “extrinsic mistake” test. 

CONCLUSION AND ORDER 

Accordingly, the Court denies Defendant’s motion to set aside the entry of default for the reasons stated above.  The Clerk of the Court shall provide notice of the Court’s ruling.