Judge: Monica Bachner, Case: 21STCV26829, Date: 2023-02-17 Tentative Ruling

Department 71: Attorneys who elect to submit on these published tentative rulings, without making an appearance at the hearing, may so notify the Court by communicating this to the Department's staff at (213) 830-0771 before the set hearing time.  See, e.g., CRC Rule 324(b).   All parties are otherwise encouraged to appear by Court Call for all matters.

Case Number: 21STCV26829    Hearing Date: February 17, 2023    Dept: 71

Superior Court of California

County of Los Angeles

DEPARTMENT 71

TENTATIVE RULING

Plaintiff Westlake Services’s motion for sanctions is denied.

          Plaintiff Westlake Services, LLC dba Westlake Financial Services (“Plaintiff”) moves for sanctions against Defendant and Ramseyfaiz M. Abboushi, counsel for Defendant Husni Othman (“Defendant”), in the amount of $6,660.00.  (Notice of Motion, pg. i.) Plaintiff moves pursuant to California Code of Civil Procedure § 128.7.

Background 

          On July 21, 2021, Plaintiff Westlake Services, LLC dba Westlake Financial Services (“Plaintiff”) filed a complaint against Husni Othman (“Defendant” for purposes of this motion) and Roxanne Auto (collectively, “Defendants”), alleging causes of action for open book account, account stated, reasonable value, breach of contract, and breach of guarantee for an unpaid debt in the amount of $26,695.55, due on August 23, 2019. The debt was incurred in connection with Defendants’ alleged breach of a September 15, 2014 Master Dealer Agreement (“Contract”) entered into by Plaintiff and Defendants. (Complaint ¶¶1-3, 19-20, Exh. 1.)

          Default was entered against Defendant on October 21, 2021. On January 31, 2022, Defendant filed a motion to set aside entry of default and default judgment. That motion was denied on January 3, 2023, after the Court found Defendant failed to make a showing of excusable neglect.

          On June 27, 2022, Plaintiff filed this motion for sanctions against Defendant and Defendant’s counsel, Ramseyfaiz M. Abboushi, in connection with filing the motion to set aside entry of default and default judgment. Plaintiff alleges Defendant made demonstrably false representations in his motion to set aside entry of default and default judgment, including that he did not reside at 258 71st St., Brooklyn, New York, 11209 at the time Plaintiff served the summons and complaint, and that he was not on notice of this lawsuit until November 1, 2021. Defendant filed an opposition to this motion on January 3, 2023. Plaintiff filed a reply on February 9, 2023.

Legal Standard

          CCP § 128.7(b) provides “by presenting to the court… a pleading, petition, written notice of motion, or other similar paper, an attorney or unrepresented party is certifying that to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances, all of the following conditions are met: (1) it is not being presented primarily for an improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation [;] (2) the claims, defenses, and other legal contentions therein are warranted by existing law or by a non-frivolous argument for the extension, modification, or reversal of existing law or the establishment of new law [;] (3) the allegations and other factual contentions have evidentiary support or, if specifically so identified, are likely to have evidentiary support after a reasonable opportunity for further investigation or discovery [;] [and] (4) the denials of factual contentions are warranted on the evidence or, if specifically so identified, are reasonably based on a lack of information or belief.” (CCP § 128.7(b).)

          Furthermore, if, after notice and a reasonable opportunity to respond, the court determines that there has been a violation, the court may, subject to certain conditions, “impose an appropriate sanction upon the attorneys, law firms, or parties that have violated subdivision (b) or are responsible for the violation. In determining what sanctions, if any, should be ordered, the court shall consider whether a party seeking sanctions has exercised due diligence.” (CCP § 128.7(c).) A motion for sanctions under this section shall be made separately from other motions or requests and shall describe the specific conduct alleged to violate subdivision (b). (CCP § 128.7(c)(1).) Notice of motion shall be served as provided in Section 1010 , but shall not be filed with or presented to the court unless, within 21 days after service of the motion, or any other period as the court may prescribe, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected. (CCP § 128.7(c)(1).) If warranted, the court may award to the party prevailing on the motion the reasonable expenses and attorney’s fees incurred in presenting or opposing the motion. (CCP § 128.7(c)(1).)

          A sanction imposed for violation of CCP § 128.7 subdivision (b) shall be limited to what is sufficient to deter repetition of this conduct or comparable conduct by others similarly situated. (CCP § 128.7(d).) Monetary sanctions may not be awarded against a represented party for a violation of paragraph (2) of subdivision (b). (CCP § 128.7(d)(1).)

Grounds for Sanctions

            Plaintiff argues there are grounds for sanctions under CCP §§ 128.7(b)(2), in that the motion was frivolous, meritless and based on false testimony.  (Notice of Motion, pg. ii, lines 6-7; Motion, pg. 6.)  Specifically, Plaintiff takes issue with the following: Defendant did not make an adequate showing of excusable neglect; Defendant’s motion failed as a matter of law because Defendant admitted to knowledge of the complaint in time to defend the lawsuit, provided no explanation for his failure to exercise diligence in filing the motion, and did not show a meritorious defense; Defendant argued without any support that he did not have notice of the action in time to defend and that the summons and complaint were never validly served; and Defendant submitted knowingly false testimony under penalty of perjury, including that service did not take place until October 20, 2021 and that Defendant was not in receipt of the documents until recently. (Notice of Motion, pg. ii-iii, lines 9-28 and 1-3.)

                    Defendant argues that his motion to set aside was proper and based on arguable facts. (Declaration of Ramsey Abboushi, ¶ 11.) Defendant argues that the conversation which occurred between Defendant and a representative of Plaintiff on August 25, 2022, was no more than a mere telephone debt collection attempt which provided for no notice of where the action was filed, the case information, a blank answer, or information concerning the deadline of when the answer or response would be due which would all be contained on a paper summons. (Declaration of Ramsey Abboushi, ¶ 10.)   Here, based upon the motion and opposition, the Court set an evidentiary hearing as to the motion.  In consideration of all of the facts, the Court declines to find that defense counsel filed the motion based on knowingly false testimony or that it was patently frivolous.
         

Dated:  February 17, 2022

Hon. Monica Bachner

Judge of the Superior Court