Judge Michelle Williams Court, Case 21STCV46668 2022-08-24 Tentative Ruling

Judge: Michelle Williams Court, Case: 21STCV46668, Date: 2022-08-24 Tentative Ruling

Case Number: 21STCV46668 Hearing Date: August 24, 2022 Dept: 74

21STCV46668 JEFF FAN vs MARIO FLORES, et al.

OSC re Entry of Default Judgment

TENTATIVE RULING: Plaintiff’s supplemental documents are insufficient to support the judgment sought. The OSC is CONTINUED to September 28, 2022 at 8:30 a.m.

Background

On December 22, 2021, Plaintiff Jeff Fan filed a complaint against Mario Flores dba The Home Management Group, and Allstate Investment Group, Inc., dba Home Management Company. The complaint asserted causes of action for: (1) constructive fraud, (2) fraudulent concealment, (3) fraudulent inducement/misrepresentation, (4) breach of contract, (5) breach of contract, (6) breach of the implied covenant of good faith and fair dealing, and (7) negligence, (8) violation of Business & Professions Code §§ 17200, et seq., and (9) declaratory relief. The complaint alleges that Plaintiff entered into a Property Management Agreement with Defendant HMC for the management of the Subject Property. In 2021, Defendant Flores began a management company and the HMC’s file for management was transferred to Flores’ company, THMG. Later, Flores represented those two tenants wanted to rent the Subject Property. However, Plaintiff alleges that the rental agreement was not signed by Tenants, but rather Flores so as to have Flores pocket extra rental income.

On May 24, 2022, the Court issued an order on Plaintiff’s initial default judgment package directing Plaintiff “to file declarations regarding damages calculation and interest calculation [and] . . . to re-calculate attorneys fees in compliance with LASC Local Rule 3.214.”

Plaintiff filed supplemental documents on June 28, 2022.

Legal Standard

Code of Civil Procedure section 585 permits entry of a judgment after a Defendant fails to timely answer following proper service of process. A party seeking judgment on the default by the Court must file a Request for Court Judgment, and provide: (1) a brief summary of the case; (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 proposed form of judgment; (6) a dismissal of all parties against whom judgment is not sought; (7) a dismissal of all parties against whom judgment is not sought or an application for separate judgment 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 attorneys’ fees if allowed by statute or by the agreement of the parties. (Cal. R. Ct., rule 3.1800(a).)

Plaintiff’s Supplemental Documents are Insufficient to Support the Judgment Sought

In his initial default judgment package, Plaintiff sought $21,065.00 in damages and $11,610.00 in attorneys’ fees.

On June 28, 2022, Plaintiff filed supplemental documents in response to the issues raised in the Court’s May 24, 2022 order. Plaintiff reduced the claimed attorneys’ fees consistent with Local Rule 3.214 and provided a calculation of the damages and interest claimed.

Plaintiff improperly claims $9,378.85 in damages for 65 hours of his personal “time spent working to resolve the legal issues resulting from the fraudulent conduct of Defendants” based upon Plaintiff’s claimed “hourly compensation in his role as Director of Finance” for a “nationally recognized company.” (Tatone Decl. ¶ 17(e); Fan Decl. ¶ 24(e).).) Plaintiff also seeks $8,657.40 for five hours per month of his time going forward. (Id. ¶ 17(f).) Plaintiff is not entitled to compensation for his personal time. Plaintiff is a salaried employee and therefore is not losing compensation based upon his time spent managing his own property. (Tatone Decl. ¶ 17(e); Fan Decl. ¶ 24(e).) Additionally, Plaintiff’s claimed level of compensation as a Director of Finance is not a proper measure of damages. These damages must be removed.

Plaintiff seeks $1,341.00 in damages based upon his unilateral decision to charge tenants $149.00 less in rent “as a concession for what TENANTS were subjected to as a result of DEFENDANTS’ fraudulent dealings and fraudulent conduct.” (Fan Decl. ¶ 24(d).) These are not consequential damages caused by Defendants’ fraud and must be removed.

Plaintiff has demonstrated a right to damages in the amount of $10,722.67 consisting of the funds paid by the tenants to Defendants, but not remitted to Plaintiff and the return of funds paid for management services which were not rendered. Specifically, Plaintiff has demonstrated a right to damages based upon the $3,999.00 security deposit, $3,999.00 for August 2021 rent, $2,025.67 for the portion of September 2021 rent, $299.00 for the portion of October 2021, and $400.00 for services not provided.

Plaintiff must provide a new judgment consistent with damages of $10,722.67 as well as new calculations for prejudgment interest and attorneys’ fees consistent with this damage amount.