Judge Peter A. Hernandez, Case Number: 23STCP02324, Date: 2024-11-26 Tentative Ruling

Judge: Peter A. Hernandez, Case: 23STCP02324, Date: 2024-11-26 Tentative Ruling

Case Number: 23STCP02324 Hearing Date: November 26, 2024 Dept: 34

Defendant Paul S. Chao’s Motion to Set Aside/Vacate Default and Default Judgment is GRANTED. A penalty in the amount of $1,000 is payable to Plaintiff within 30 days pursuant to section 473(c)(1)(A).

Background

On July 5, 2023, Plaintiff Dai Yongzheng (“Plaintiff”) filed a complaint against Defendant Paul S. Chao (“Defendant”) on causes of action for conversion, breach of fiduciary duty, and breach of duty of good faith and fair dealing pursuant to Corporations Code section 17704.08, subdivision (d).

On December 29, 2023 and January 2, 2024, the court issued Orders for Publication in this matter.

On April 19, 2024, at the request of Plaintiff, the Clerk’s Office entered default on Defendant.

On May 20, 2024, the court granted Plaintiff’s Request for Default Judgment.

On October 18, 2024, Defendant filed this Motion to Set Aside/Vacate Default and Default Judgment. On October 22, 2024, Plaintiff filed an opposition to Defendant’s motion. No reply has been filed.

Legal Standard

“The 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. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken. . . . No affidavit or declaration of merits shall be required of the moving party. 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. . . .” (Code Civ. Proc., § 473, subd. (b).)

Section 473(b) provides for two distinct types of relief. “Under the discretionary relief provision, on a showing of “mistake, inadvertence, surprise, or excusable neglect,” the court has discretion to allow relief from a “judgment, dismissal, order, or other proceeding taken against” a party or his or her attorney. Under the mandatory relief provision, on the other hand, upon a showing by attorney declaration of “mistake, inadvertence, surprise, or neglect,” the court shall vacate any “resulting default judgment or dismissal entered.” (Leader v. Health Industries of America, Inc. (2001) 89 Cal.App.4th 603, 615–616.)

Discussion

Defendant moves the court for relief pursuant to Code of Civil Procedure section 473, subdivision (b). (Motion, at p. 2.) Specifically, Defendant moves the court to set aside the default and default judgment entered against him due to Defendant’s counsel mistake, inadvertence, surprise, or neglect under the mandatory relief provision of section 473(b). (Ibid.)

Defendant’s counsel, Dana Delma (“Counsel”), declares that Counsel was to serve and file an answer to Plaintiff’s complaint by April 11, 2024, as agreed upon with Plaintiff’s counsel on March 28, 2024. (Declaration of Dana Delma (“Delma Decl.”), ¶ 4.) During those two weeks, Counsel became ill but nevertheless finalized an answer which Counsel attached to her declaration. (Id., ¶ 5.) Counsel instructed her assistant to serve and file the answer. (Id., ¶ 6.) However, due to a misunderstanding and miscommunication, the answer was not filed nor served. (Ibid.) It was not until mid-May of 2024 that Counsel realized that the answer had not been filed or served. (Ibid.)

In opposition, Plaintiff argues that Defendant engaged in bad faith behavior to intentionally avoid the service of process. (Opp., at p. 3.) As such, Plaintiff contends that Plaintiff deserves reasonable compensation for the legal fees and costs incurred from preparing the documents related to the Entry of Default and Default Judgment against Defendant in the amount of $5,000.00. (Ibid.) Additionally, Plaintiff argues that Defendant avoided service when the registered service provider attempted to personally serve Defendant in his residence located at 1832 S. Fifth Ave., Unit E, Monrovia, CA 91016 on July 18, 2023. (Id., at p. 4.) As such, Plaintiff argues that Defendant’s failure to file and serve an answer was not solely caused by error of Defendant’s counsel. (Ibid.)

No reply has been filed.

The court finds that the present motion is timely. Additionally, Defendant’s counsel has submitted a declaration attesting to her mistake in failing to file the answer to Plaintiff’s complaint. The dismissal was a direct result of Counsel’s error granting Defendant mandatory relief under section 473.(b). As all statutory requirements to set aside default and vacate the default judgment against Defendant are satisfied, Defendant’s motion is granted.

Conclusion

Defendant Paul S. Chao’s Motion to Set Aside/Vacate Default and Default Judgment is GRANTED. The court further imposes a penalty in the amount of $1,000 payable to Plaintiff within 30 days pursuant to section 473(c)(1)(A).