SUPERIOR COURT OF THE STATE OF CALIFORNIA  

FOR THE COUNTY OF LOS ANGELES - CENTRAL DISTRICT 

 

 

I. Background  

Plaintiffs Gudelia Barbosa (“Barbosa”) and Carmen Nazarian (“Nazarian”) (collectively, “Plaintiffs”) filed this action against Defendants Roberto Marco Amici (“Roberto”) and Sarah Amici (“Sarah”) (collectively, “Defendants”) for injuries arising from a motor vehicle incident.   

On May 2, 2023, Plaintiff filed a notice of acceptance of Defendant Roberto’s CCP § 998 offer to Plaintiff Barbosa for $85,000.  

On June 12, 2023, Plaintiffs dismissed Defendant Sarah pursuant to Defendant Sarah’s acceptance of Plaintiffs’ CCP § 998 offer.  

On June 28, 2023, Defendant Roberto filed the instant motion for relief from judgment and entry of judgment resulting from Plaintiff’s acceptance of Defendant Roberto’s statutory offer. Furthermore, Defendant Roberto requests permission to withdraw the statutory offer due to defense counsel’s mistake. Plaintiffs oppose the motion, and Defendant Roberto filed a reply.  

 

II. Motion to Set Aside  

CCP § 473(b) states in pertinent part: 

 

Notwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney's sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorney's mistake, inadvertence, surprise, or neglect… 

 

The provision of §473 which mandates relief from a judgment of dismissal or default when the motion is based on an attorney's affidavit of fault does not mandate relief from other judgments.  In all other cases, relief is discretionary. (Ayala v. Southwest Leasing & Rental, Inc. (1992) 7 Cal.App.4th 40, 43.) 

Accordingly, Defendants seek discretionary relief under §473(b).  To warrant discretionary relief here, the proffered evidence must show that the attorney's error was excusable.  (Huh v. Wang (2007) 158 Cal. App. 4th 1406, 1423.)  Neglect is excusable only if a reasonably prudent person in similar circumstances might have made the same error. (Bettencourt v. Los Rios Community College Dist. (1986) 42 Cal.3d 270, 276.)  Relevant factors in assessing counsel error include: “(1) the nature of the mistake or neglect; and (2) whether counsel was otherwise diligent in investigating and pursuing the claim.” (Bettencourt, supra, at p. 276.) Excusable neglect, including for purposes of Code of Civil Procedure Section 473, includes the circumstances where an attorney relies upon employees who err in performing tasks. (Renteria v. Juvenile Justice, Dept. of Corrections and Rehabilitation (2006) 135 Cal.App.4th 903, 911-12 (attorney’s reliance on secretary's erroneous removal of the claim filing date from the calendar was excusable).)   

Here, on September 30, 2022, Plaintiffs served statutory offers in the amount of $15,000 on Defendant Sarah, the owner of the vehicle, for $15,000. Defendant Sarah accepted those offers on November 11, 2022, and Plaintiffs dismissed Defendant Sarah on June 12, 2023. Thereafter, Defendants served both Plaintiffs with statutory offers on April 19, 2023. Defendants offered $85,000 to Plaintiff Barbosa and $75,000 to Plaintiff Nazarian. Plaintiff Barbosa accepted the offer before defense counsel discovered the error and was able to withdraw the offer. Defense counsel declares he confirmed with the claims representative for State Farm that the statutory offer to Plaintiff Barbosa should have been $70,000. (Mot. Decl. Pasarow, ¶ 4.) Defense counsel further declares he emailed his secretary, Monique Ortiz (“Ortiz”) on March 30, 2023 to prepare the settlement offers and requested Ortiz speak discuss with him the correct amounts. (Id. at ¶ 5.) Three weeks later, Ortiz prepared the statutory offers without any discussion, and defense counsel failed to notice that the documents offered the wrong amounts. (Id. at ¶ 6.) Ortiz declares she prepared the statutory offers without remembering to reduce the amount by $15,000 already paid, and that she did not closely read Pasarow’s email closely. (Mot. Decl. Ortiz, ¶ 2.)  

Defense counsel further declares they did not realize the wrong amount had been offered until April 28, 2023, when State Farm called to inform counsel that the authority for Plaintiff Barbosa was $70,000 and for Nazarian $60,000. (Mot. Decl. Grover, ¶ 2.) Defense counsel then immediately withdrew the offer to Plaintiff Nazarian prior to acceptance. (Ibid.) On May 1, 2023, defense counsel called Plaintiff’s counsel to explain the mistake, and Plaintiff’s counsel did not agree to undo the settlement. (Id. at ¶ 3.) Plaintiff’s counsel filed Plaintiff Barbosa’s notice of acceptance after defense counsel had requested to set aside the acceptance. (Ibid.) On April 14, 2023, Plaintiff’s counsel renewed a policy limits demand to defense counsel. (Id. at ¶ 4.)  

Defense counsel relies on Zamora v. Clayborn Contracting Group, Inc. (2002) 28 Cal.4th 249. In Zamora, plaintiff’s counsel’s legal assistant prepared a CCP section 998 offer, wherein the assistant mistakenly offered to settle for a judgment taken “against” instead of “in favor of” of plaintiff. Plaintiff’s counsel authorized the legal assistant to send the offer with counsel’s stamped signature despite not having reviewed it, because counsel was out of town at the time. The appellate court concluded that CCP 473(b) permitted relief from a judgment entered in accordance with a section 998 settlement for “mistake, inadvertence, surprise, or excusable neglect” and that the trial court did not abuse its discretion by granting plaintiff relief from the section 998 settlement. The California Supreme Court affirmed the trial court’s ruling.  

In opposition, Plaintiffs contend that defense counsel submitted no affidavit of the insurance carrier’s instructions to defense counsel regarding the statutory offer made to Plaintiff Barbosa. Furthermore, Plaintiffs contend defense counsel did not submit any e-mail communications to his secretary to justify relief. Plaintiffs contend that there is no showing of excusable neglect, surprise, or inadvertence under CCP §473. Further, Plaintiffs request monetary sanctions regarding the statutory offer and to oppose the instant motion. 

In reply, defense counsel contends it did not provide e-mails because it is subject to attorney-client communication and attorney work product, and that defense counsel will make those communications to the Court under seal. Furthermore, defense counsel argues that Plaintiffs’ counsel is seeking sanctions under the mandatory provisions of CCP §473, when Defendants are seeking relief under the discretionary provisions.  

The Court finds that Defendants were diligent in seeking relief under §473, because application for relief was made “within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken.” (CCP §473, subd. (b).) Furthermore, while defense counsel’s failure to notice the mistake earlier was not prudent, the Court finds that this oversight excusable under the circumstances. Upon being informed by the insurance carrier that the amount offered exceeded the authorized limit, defense counsel promptly contacted and discussed this mistake with Plaintiff’s counsel. Although the law favors settlements, it only favors authorized settlements. “An attorney does not, without specific authorization, possess the power or authority to bind his client to a compromise settlement of pending litigation.” (Bice v. Stevens (1958) 160 Cal. App. 2d 222, 231–32.) Plaintiffs’ argument that $85,000 is within the normal range of settlement for the medical specials incurred by Plaintiff Barbosa is not persuasive in terms of identifying prejudice. Further, the Court finds Plaintiffs’ request for monetary sanctions unwarranted.  

 

Based on the foregoing, Defendants motion to set aside settlement based upon Defendant Roberto’s erroneous CCP § 998 offer to Plaintiff Barbosa is GRANTED.  

 

Moving party is ordered to give notice. 

 

 

Dated this 31st day of August 2023