Judge: Michael Shultz, Case: 24STCV03708, Date: 2025-01-09 Tentative Ruling
Case Number: 24STCV03708 Hearing Date: January 9, 2025 Dept: 40
24STCV03708 Cheyenne Plante-Dostman v. Anibal Chavez, et
al.
Thursday,
January 9, 2025
[TENTATIVE]
ORDER GRANTING MOTION BY DEFENDANTS, ANIBAL CHAVEZ AND OLIVA DELIVERY SERVICE,
INC., TO SET ASIDE DEFAULT ENTERED AGAINST DEFENDANTS
I. BACKGROUND
This action alleges motor vehicle
negligence arising from an automobile collision that occurred on June 6, 2022.
(Complaint 2/13/24.) On May
14, 2024, the clerk entered default against Defendant, Oliva Service, Inc.
(“Oliva”) (Default
Entry 5/14/24.) Court judgment by default was subsequently entered
against Oliva only. (Jgmt.
8/8/24.) The court’s file reflects that the remaining named Defendant,
Anibal Chavez (“Chavez”), was personally served with the summons and complaint on
February 27, 2024. (Proof 3/15/24.) While
Plaintiff requested entry of default against Defendant Chavez, the request was
rejected. (Notc.
Rej. 4/5/24).
II. ARGUMENTS
Defendants’ unopposed but timely served
motion, filed on November 11, 2024, requests that entry of default against both
Defendants be set aside because Plaintiff’s counsel knew that Defendants were
represented by counsel but failed to inform defense counsel that Plaintiff’s complaint
had been filed and served. Defendants also seek imposition of sanctions totaling
$3,075 against Plaintiff’s counsel, Steven Awada, pursuant to Code Civ. Proc.,
§ 128.5, the Rules of Professional Conduct, and as permitted by case law for seeking
entry of default and default judgment without notifying defense counsel,
causing unnecessary expense and delay.
III. LEGAL
STANDARDS
The court has discretion to grant a party
relief from a judgment, order, or other proceeding taken against that party
through the party’s mistake, inadvertence, surprise, or excusable neglect. (Code Civ.
Proc., § 473 subd. (b).) The motion must be made within six
months from the entry of default. (Arambula v.
Union Carbide Corp. (2005) 128 Cal.App.4th 333, 345. While
Section 473 is liberally applied, the party seeking relief has to show a
satisfactory excuse for the conduct and diligence in making the motion. (Hopkins
& Carley v. Gens (2011) 200 Cal.App.4th 1401, 1410.) If no
prejudice results, only slight evidence is needed. Doubts are resolved in favor
of the party seeking relief in furtherance of the policy supporting trial and
disposition on the merits. (Mink v.
Superior Court (1992) 2 Cal.App.4th 1338, 1343.)
IV. DISCUSSION
As neither default entry nor default
judgment has been entered against Defendant Chavez, the court addresses only
the default entry and default judgment against Defendant Oliva. The evidence
shows that Mr. Awada was in contact with Defendant’s insurer since April 17,
2023, when Mr. Awada made a demand for the insurance policy limits. (Mot. Ex.
B.) Defense counsel, Cholakian & Associates, informed Plaintiff’s counsel
of its representation of its client, Anibal Chavez, who was involved in the
accident by letter dated June 22, 2023, eight months before Plaintiff filed the
complaint. (Mot. Ex. C.) Mr. Awada communicated by email with Shamika K. Bains
of Cholakian & Associates beginning July 11, 2023, through April 10, 2024,
at which time Ms. Bains requested a copy of the complaint upon filing. (Mot.
Ex. D, E.) The complaint had already been filed on February 13, 2024.
On September 26, 2024, Ms. Bains asked
whether Plaintiff had already filed a complaint and whether service was
accomplished. Ms. Bains continued to follow up with Plaintiff’s counsel
thereafter. (Mot. Ex. F, G.) On October 21, 2024, Ms. Bains notified Mr. Awada of
her awareness that Plaintiff’s counsel had already filed the complaint and
obtained entry of default. (Mot. Ex. H.) There is no indication that
Plaintiff’s counsel responded to defense counsel’s request that the default
entry and judgment be set aside.
Jose Oliva, the owner and operator of
Oliva Delivery Service, states that while he was aware of the complaint that
was served in early 2024, he was also aware that his insurance carrier retained
counsel and that the matter was being addressed, and mistakenly assumed that
the insurance carrier also received the complaint, and therefore, he did not
forward it to his insurer. (Jose Oliva decl.) A “mistake” sufficient to justify
vacating dismissal “exists when a person, under some erroneous conviction of
law or fact, does or omits to do some act which, but for the erroneous
conviction, he would not have done or omitted. It may arise either from
unconsciousness, ignorance, forgetfulness, imposition or misplaced confidence.”
(Salazar v.
Steelman (1937) 22 Cal.App.2d 402, 410.)
Courts have also considered as excusable an
insured’s failure to transmit documents to the insurer based on the good faith
assumption that the insurance company would enter an appearance and defend the
action. (Fasuyi
v. Permatex, Inc. (2008) 167 Cal.App.4th 681, 698 ["It may be
conceded that it would have been an act of prudence on [the president's] part,
when he received the copy of the summons and complaint, to have delivered them
to the insurance company; but if he had the right to believe and did believe
that the insurance company would enter its appearance and defend the action
irrespective of any service of the summons, his failure to give the copies to
it cannot be held to have been attributable to any carelessness or inattention.
Whatever omission there was must be regarded as an excusable neglect. Section
473 of the Code of Civil Procedure is a remedial provision, and is to be liberally
construed so as to dispose of all cases upon their substantial merits and to
give to the party claiming in good faith to have a substantial defense to the
action an opportunity to present it."].)
The evidence suggests that Plaintiff’s
counsel’s took advantage of that mistake and defense counsel’s ignorance of the
fact that a complaint had indeed been filed and served. There is no evidence
that Plaintiff’s counsel informed defense counsel that a complaint had been
filed, that Defendant was served, and that Plaintiff would seek entry of
default judgment although Plaintiff’s counsel was in regular contact with
defense counsel, who repeatedly inquired about the filing and service of the
complaint. Because of the policy favoring trial on the merits, such policy “looks
with disfavor upon a party, who, regardless of the merits of the case, attempts
to take advantage of the mistake, surprise, inadvertence, or neglect of his
adversary.” (Weitz v.
Yankosky (1966) 63 Cal.2d 849, 854–855.)
There is no evidence that vacating default
will result in prejudice to Plaintiff’s interests; Plaintiff did not oppose the
motion.
Defendant has not shown that sanctions may
be awarded based on statute or law. Sanctions pursuant to Code Civ. Proc., §
128.5 and § 128.7 each require that the motion be separately made and not filed
for 21 days to permit the offending party to withdraw the offending “action or
tactic,” here the default entry and judgment obtained. (Code Civ.
Proc., § 128.5 (f)(1)(B); Code Civ.
Proc., § 128.7 (c)(1).)
Defendant has not cited applicable
authority for the proposition that the court has inherent power to impose monetary
sanctions under these circumstances. (Mot. 7:1-5.) The cases cited by Defendant
are inapposite. (Peake v.
Underwood (2014) 227 Cal.App.4th 428, 432 [sanctions pursuant to Code Civ. Proc., § 128.7]; West Coast
Development v. Reed (1992) 2 Cal.App.4th 693, 697 [Code Civ.
Proc., § 128.5 sanctions]; Stephen
Slesinger, Inc. v. Walt Disney Co. (2007) 155 Cal.App.4th 736, 740 ["In
this case of first impression in California, we hold that when a plaintiff's
deliberate and egregious misconduct makes any sanction other than dismissal
inadequate to ensure a fair trial, the trial court has inherent power to impose
a terminating sanction."]; In re
Marriage of Davenport (2011) 194 Cal.App.4th 1507, 1510 [Attorney’s
fees and costs awarded pursuant to Family Code § 271.]
The source of the court’s power to
sanction must be provided for by statute. (Bauguess v.
Paine (1978) 22 Cal.3d 626, 637–638 ["It would be both unnecessary and unwise to
permit trial courts to use fee awards as sanctions apart from those situations
authorized by statute. If an attorney's conduct is disruptive of court
processes or disrespectful of the court itself, there is ample power to punish
the misconduct as contempt."].)
Defendant’s reliance on Business and
Professions Code § 6068 (d) is misplaced. While the statute imposes certain
duties on attorneys, Defendant does not cite any provision that permits
imposition of sanctions for an attorney’s conduct that violates that section.
V. CONCLUSION
Based on the foregoing, Defendant’s motion
is GRANTED. The court vacates the default entered on May 14, 2024, against
Defendant, Oliva Service, Inc. and the court judgment by default entered
against Oliva only on August 8, 2024. Defendant’s request for imposition of
monetary sanctions is DENIED. Defendant submits a copy of its proposed answer,
which shall be filed within five days.