Judge Ralph C. Hofer, Case Number: 22GDCV00595, Date: 2023-07-21 Tentative Ruling

Plaintiff Edvard Akopyan alleges that defendants Ana Airapetian and Tamara S. Chirkalina became indebted to plaintiff in the sums of money of $17,000 and $25,000 for plaintiff’s services rendered and failed to repay the money by issuing a check in the amount of $17,000 from a closed account and refusing to pay the amount of $25,000 when requested.

The file shows that on December 13, 2022, default was entered against defendant Anna Airapetian, based on proof of service showing the summons and complaint were served by substituted service on September 29, 2022, at defendant’s usual place of business in New York, NY by leaving the documents in the presence of Jessica Biever, Co-Worker, and by making follow up mailing to the address of service.

On February 24, 2023, the court heard a motion to set aside entry of default and quash service of summons filed by specially appearing defendant Airapetian. The motion was granted, the court finding that defendant appropriately had established that the service address was not defendant’s usual place of business or usual mailing address, but the service address was at an office of defendant’s employer where defendant had never worked.

“defendant has submitted a declaration indicating that the service address is not her usual place of business, and that service was not made on a person authorized to accept service on her behalf. [Airapetian Decl., paras. 5-8]. Defendant states with respect to the service address, “I have never worked at the Compass office located at this address and it is not my usual place of business. The address is also not my residence.” [Airapetian Decl., para. 7]. The moving papers also indicate that the initial service attempt of the three described attempts was on an address with which defendant has no affiliation. [Airapetian Decl., para. 8]. The proof of service declaration of diligence itself states that the process server was “not able to find the address,” and that someone informed the server the address did not exist. [POS, Decl., “Serve Attempt #1].

“Plaintiff relies solely on the proof of service, and has not come forward with conflicting evidence as to defendant’s declaration, such as a declaration of the process server or evidence suggesting that the service address was in fact defendant’s usual place of business or usual mailing address. Plaintiff has accordingly failed to establish that service was properly made and failed to meet plaintiff’s burden to show that jurisdiction has been established by a preponderance of the evidence. Defendant’s declaration provides substantial evidence in support of the determination that service was not appropriately made at defendant’s usual place of business, which the court finds credible. The motion to set aside the default is granted on the ground the default is void as based on improper service of summons.”

The court ordered: “Motion to Set Aside Entry of Default is GRANTED pursuant to CCP section 473(d). Default entered against moving defendant Anna Airapetian on Decembe 13, 2022 is set aside as void, as based on improper service.” [Minute Order, 02/24/2023, p. 5 of 6].

The file also shows that on April 4, 2023, the court conducted an OSC re Why Sanctions Should Not Be Imposed Failing to File Proof of Service, at which plaintiff represented that plaintiff had not re-served defendant, and that there was a motion for reconsideration scheduled for 07/21/2023. The minute order reflects that there was no appearance for defendants. The minute order also states that “Defense counsel” stated that the other motions scheduled for 07/19/2023 were the same motion, and the court ordered the 07/19/2023 dates taken off calendar.

“When an application for an order has been made to a judge, or to a court, and refused in whole or in part, or granted, or granted conditionally, or on terms, any party affected by the order may, within 10 days after service upon the party of written notice of entry of the order and based upon new or different facts, circumstances, or law, make application to the same judge or court that made the order, to reconsider the matter and modify, amend, or revoke the prior order.”

Ten days from that date was March 6, 2023. However, since the notice was served by mail, the time to make application to the court was extended by five calendar days pursuant to CCP section 1013, which provides that where service is made by mail:

“any period of notice and any right or duty to do any act or make any response within any period or on a date certain after service of the document, which time period is prescribed by statute or rule of court, shall be extended five calendar days, upon service by mail, if the place of address and the place of mailing is within the State of California…”

Permitting an additional five calendar days for service of the notice by mail, the motion must have been made by March 11, 2023, a Saturday. The motion was served on the parties on March 12, 2023, a Sunday, and then filed with the court on March 13, 2023, a Monday, and the first court day after the deadline had expired. The motion accordingly is timely. The motion is not denied on that ground.

“The party making the application shall state by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown.”

“This section specifies the court's jurisdiction with regard to applications for reconsideration of its orders and renewals of previous motions and applies to all applications to reconsider any order of a judge or court, or for the renewal of a previous motion, whether the order deciding the previous matter or motion is interim or final. No application to reconsider any order or for the renewal of a previous motion may be considered by any judge or court unless made according to this section.”

Here, the declaration fails to identify to what judge the previous application was made. The motion could be denied for failure of plaintiff to comply with the statutory requirements for bringing such a motion, but the Court elects not to do so.

“This section specifies the court's jurisdiction with regard to applications for reconsideration of its orders and renewals of previous motions, and applies to all applications to reconsider any order of a judge or court, or for the renewal of a previous motion, whether the order deciding the previous matter or motion is interim or final. No application to reconsider any order or for the renewal of a previous motion may be considered by any judge or court unless made according to this section.”

The trial court’s determination of a motion for reconsideration is reviewed for abuse of discretion. See Wiz Technology, Inc. v. Coopers & Lybrand (2003, 2nd Dist.) 106 Cal.App.4th 1, 16.

Plaintiff’s declaration indicates that the new or different facts underlying the motion for reconsideration are that plaintiff has known defendant Airapetian for many years, and that it is unfair surprise to him that in opposition to the previous motion Airapetian would create an impression that the address in New York is not her business address. [Akopyan Decl., para. 15]. Plaintiff indicates that at the previous hearing:

“in response to this Court’s inquiry, I stated that ANNA AIRAPETIAN was not truthful in her Declaration with regard to her position pertaining to the address in question, 90 5th Ave, 3rd Floor, New York, NY 10011. The Court's response, however, was that ANNA AIRAPETIAN had signed her Declaration under penalty of perjury.”

Plaintiff also states in his declaration that he knows defendant and her family members, and “knows that she works at Compass real estate company” at the service address, “and also posts it on social media.” [Akopyan Decl., para. 4]. Plaintiff also indicates he has conducted an internet search and found the subject address listed in connection with her license, and that the company website shows that Airapetian works at Compass, and its headquarters is located at the service address. [Akopyan Decl., paras. 6, 7, Exs. 1, 2].

These are not new or different facts which could not have been submitted to the court in connection with the previous motion. Plaintiff was served with the Airapetian Declaration he now complains of well in advance of the time to oppose the motion, and previously chose not to submit any further evidence concerning the propriety of the service in opposition to the motion, relying only on the declaration of the process server, who was not a registered California process server.

When bringing a motion for reconsideration based on new facts, the moving party must present “a satisfactory explanation for failing to provide the evidence earlier, which can only be described as a strict requirement of diligence.” Garcia v. Hejmadi, (1997) 58 Cal.App.4th 674, 690.

“Section 1008, subdivision (a) requires that a motion for reconsideration be based on new or different facts, circumstances, or law. A party seeking reconsideration also must provide a satisfactory explanation for the failure to produce the evidence at an earlier time.”

The motion fails to explain why plaintiff did not provide his declaration and evidence earlier. In fact, the declaration indicates that plaintiff did in fact argue at the hearing that the declaration filed with the moving papers was not truthful.

The argument seems to be that the court did not believe plaintiff at the hearing, in effect, that plaintiff did not effectively counter defendant’s showing under penalty of perjury that the service address was not her usual place of business. The fact that counsel did not effectively argue then existing facts known to counsel is not a ground for reconsideration. Gilberd v. AC Transit (1995) 32 Cal.App.4th 1494, 1500. See also, New York Times, at 212-214, in which the Second District found insufficient an argument that deposition testimony had not been previously offered because counsel “did not believe it necessary” to obtain further evidence to defeat the motion for summary judgment.

Here, what essentially has happened is that plaintiff has now had the opportunity to read the court’s assessment of what was missing in plaintiff’s previous opposition to the motion to set aside the default, and is seeking to have the court reconsider its ruling based on facts known to plaintiff and material available to him prior to the previous hearing which he did not feel the need to present until pointed out to him by the court.

Under New York Times, supra, a party’s decision not to present evidence that was available to it because the party thought the information was not necessary is not a satisfactory explanation for a failure to present it earlier. New York Times, at 212-214. New declarations offered in support of a motion for reconsideration containing information which a party was “obviously aware of” at the time of the original hearing are not sufficient and justify a trial court denying a motion for reconsideration. Hennigan v. White (2011) 199 Cal.App.4th 395, 405-406.

The consideration of this belatedly presented evidence would appear to be particularly improper here, since, as set forth above, the court had observed in its previous ruling:

“Plaintiff relies solely on the proof of service and has not come forward with conflicting evidence as to defendant’s declaration, such as a declaration of the process server or evidence suggesting that the service address was in fact defendant’s usual place of business or usual mailing address. Plaintiff accordingly has failed to establish that service was properly made and failed to meet plaintiff’s burden to show that jurisdiction has been established by a preponderance of the evidence.”

This ruling by the court should not be construed as an invitation for the submission of further evidence, when the time for the submission of evidence was with the opposition to the previous motion.

In Garcia v. Hejmadi (1998) 58 Cal.App.4th 674, 687-688, the court of appeal found that the trial court erred in granting a motion to set aside an order granting summary judgment under CCP § 473 based on plaintiff’s filing of untimely supplemental opposition papers in reaction to the trial court’s tentative ruling on the motion. The court of appeal found that relief was not properly granted under CCP § 473, and also found that, although the trial court had not ruled on plaintiff’s motion to the extent it sought reconsideration under CCP § 1008, that there was no “satisfactory” explanation for not filing earlier a declaration of plaintiff consisting of facts “obviously always within his possession.” Garcia, at 690.

Here, the evidence submitted, which was always within plaintiff’s ability to obtain and submit, was similarly improperly submitted in reaction to the trial court’s tentative, and then final, ruling on the motion. These facts were not new facts which could not have been previously presented.

In the absence of new or different facts, circumstances, or law, as set forth above, and any attempt to explain, let alone satisfactorily explain, the failure to offer them previously, the statute provides that the court may not reconsider its previous ruling. The motion for reconsideration pursuant to CCP section 1008 accordingly is denied.

First, the showing does not address or defeat a primary ground for finding the service improper, in effect, that the declaration of diligence in support of effecting service by substituted service, rather than by personal service on defendant, was not proper, as it did not show sufficient diligence in personally serving defendant.

“(b) If a copy of the summons and complaint cannot with reasonable diligence be personally delivered to the person to be served…a summons may be served by leaving a copy of the summons and complaint at the person’s dwelling house, usual place of abode, usual place of business, or usual mailing address other than a United States post office box…”

The burden is on the plaintiff to show that reasonable attempts were made to serve personally before resorting to substituted service. Evartt v. Superior Court (1979) 89 Cal.App.3d 795, 801.

“The moving papers also indicate that the initial service attempt of the three described attempts was on an address with which defendant has no affiliation. [Airapetian Decl., para. 8]. The proof of service declaration of diligence itself states that the process server was “not able to find the address,” and that someone informed the server the address did not exist. [POS, Decl., “Serve Attempt #1].”

Plaintiff has made no effort here to show that the declaration of diligence was in fact proper or that reasonable diligence was exercised to personally serve defendant prior to resorting to substituted service. This showing alone is sufficient to render the service improper and void and to justify the court’s order.

Moreover, the evidence submitted by plaintiff to show that the substituted service was made at defendant’s usual business address is not particularly strong, in light of the declaration previously submitted by defendant which the court found credible.

Specifically, plaintiff does not in his declaration state why he believes the service address is defendant’s Compass office, her usual place of business, rather than corporate headquarters, such as that plaintiff has met with defendant there.

The documentation submitted showing the headquarters address on licensing records is not supported by some legal argument that such a designation in a licensing record establishes a usual place of business. [See Ex. 1].

As to the document which is submitted as Exhibit 2, as argued in the opposition, the document is not authenticated. Defendant also argues in the opposition that the documentation, which plaintiff appears to represent to the court is a single document showing defendant’s business concierge page with her business address at the service address, is misleading, as consisting of two separate pages from two separate websites. This argument does appear to be misleading, and in any case, provides three separate addresses, and expressly designates the New York address as “Global Headquarters.” [Ex. 2].

Plaintiff also relies on a text exchange with defendant in which defendant indicates that she had received the complaint, “the first time you what’s app Ed me,” that she would “retain counsel in CA,” and stating, “Do not contact my workplace again.” [Ex. 3]. This statement is not an admission that the service address was defendant’s proper service address, there is no authority cited under which service by “what’s app” is appropriate service, and it is clear that once California counsel was retained, the service deficiency was identified. The court on reconsideration in light of plaintiff’s arguments would not change its ruling.

Plaintiff relies on Le Francois v. Goel (2005) 35 Cal.4th 1094, in which the California Supreme Court held a trial court lacks authority to hear and determine a second motion for summary judgment brought by a party which is not based on new facts or law or otherwise conforms with the summary judgment statutory limitations on such motions. Le Francois, at 1104. The Court then considered whether the legislature through such statutes can limit the authority of the court to act on its own motion to correct its own errors, and construed the statutes as not imposing a limitation on the court’s authority to reconsider:

“We hold that sections 437c and 1008 limit the parties’ ability to file repetitive motions but do not limit the court’s ability, on its own motion, to reconsider its prior interim orders so that it may correct its own errors.”

The Court then noted that a party could not be prevented from “communicating the view to a court that it should reconsider a prior ruling,” but in that case, or where the judge “has an unprovoked flash of understanding in the middle of the night,” the Court imposed specific conditions on the trial court’s authority to reconsider a decision on its own motion:

“Unless the requirements of section 437c, subdivision (f)(2) or 1008 are satisfied, any action to consider a prior interim order must formally begin with the court on its own motion. To be fair to the parties, if the court is seriously concerned that one of its prior interim rulings might have been erroneous, and thus that it might want to reconsider that ruling on its own motion— something we think will happen rather rarely— it should inform the parties of this concern, solicit briefing, and hold a hearing. Then, and only then, would a party be expected to respond to another party’s suggestion that the court should reconsider a previous ruling. This procedure provides a reasonable balance between the conflicting goals of limiting repetitive litigation and permitting a court to correct its own erroneous interim orders.”

It should be noted that since the holding in Le Francois, the legislature has amended the summary judgment statute to set forth a procedure for bringing a second motion for summary judgment. See CCP § 437c(f)(2):

“A party shall not move for summary judgment based on issues asserted in a prior motion for summary adjudication and denied by the court, unless that party establishes to the satisfaction of the court, newly discovered facts or circumstances or a change of law supporting the issues reasserted in the summary judgment motion.”

In any case, the court in this situation is not inclined to on its own motion issue notice inviting further briefing for reconsideration of its ruling. As discussed above, the court is not persuaded its ruling was incorrect. This is a situation presenting issues of personal jurisdiction and constitutional due process and is also a situation where plaintiff is not by the court’s previous order deprived of anything plaintiff cannot continue to pursue by following the proper procedures to effect service of defendant and pursue plaintiff’s remedies by prosecuting this action. The motion accordingly will be denied.

As set forth in the procedural summary above, plaintiff has filed a second motion in connection with this matter, a motion to relieve plaintiff from the order setting aside entry of default pursuant to CCP section 473.

The Court in its minute order of April 24, 2023, based on being informed other motions were the same as the motion for reconsideration set this date, ordered that the motion be taken off calendar. There has apparently accordingly been no opposition filed to that motion.

However, in the event plaintiff did not intend to take that motion off calendar, the court has considered it. The motion essentially seeks relief under CCP section 473, or the court’s equitable authority to set aside orders obtained through extrinsic fraud, based on the same arguments addressed above.

“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.”

Here, plaintiff has failed to show that the order setting aside another party’s default was taken against plaintiff through plaintiff’s mistake, inadvertence, surprise or excusable neglect. Plaintiff fully participated in the previous proceedings, and has made no attempt to show mistake or neglect on the part of plaintiff.

The test of whether neglect was excusable is “whether a reasonably prudent person under the same or similar circumstances might have made the same error.” Bettencourt v. Los Rios Community College Dist. (1986) 42 Cal.3d 270, 276.

The Court does not find that plaintiff has established mistake or excusable neglect by plaintiff’s failure to sufficiently present evidence and argument at the previous hearing. This alleged mistake was not reasonable. As discussed above, the court of appeal in Garcia v. Hejmadi (1998) 58 Cal.App.4th 674, 687-688, found that the trial court erred in granting a motion to set aside an order granting summary judgment under CCP § 473 based on plaintiff’s filing of untimely supplemental opposition papers in reaction to the trial court’s tentative ruling on the motion, a situation similar to that presented here.

With respect to plaintiff’s argument based on the court’s equitable authority and extrinsic fraud, the court of appeal in Gibble v. Car-Lene Research, Inc.(1998) 67 Cal.App.4th 295, 313 held that a party seeking this relief "must make a stronger showing than is necessary to obtain relief under section 473. Gibble, at 314-315. The court set out the elements to be satisfied when seeking this relief:

"First, the defaulted party must demonstrate that it has a meritorious case. Secondly, the party seeking to set aside the default must articulate a satisfactory excuse for not presenting a defense to the original action. Lastly, the moving party must demonstrate diligence in seeking to set aside the default once discovered."

“when a party is deprived of his opportunity to present his claim or defense to the court, where he was kept in ignorance or in some other manner fraudulently prevented from fully participating in the proceeding. Examples of extrinsic fraud are: concealment of the existence of a community property asset, failure to give notice of the action to the other party, convincing the other party not to obtain counsel because the matter will not proceed (and it does proceed).”

This analysis appears to have no application here, where plaintiff is not a defaulted party, and has not been deprived of his opportunity to fully participate in the prior proceeding, but did in fact participate. The fraud apparently relied upon would be the alleged fraud which occurred in the proceeding, in effect, that defendant submitted false testimony concerning her usual place of business address, of which plaintiff was fully aware of when the motion was filed, and had the opportunity to address in his opposition papers and in oral argument. In addition, as discussed in detail above, there has been no error argued or established with respect to the court’s determination that the declaration of diligence was defective. The motion for relief accordingly is denied.

The declaration and motion fail to show any new or different law, facts or circumstances which were not known to the moving party or could not have been or were not argued at the previous hearing on which the motion is based, as required under CCP § 1008. No showing of diligence is attempted to be made.

Even if the Court were to reconsider its ruling on the previous motion, the motion to set aside the default would still be granted. The Court would again find that plaintiff has failed to meet his burden of establishing that substituted service was properly pursued after plaintiff could not with reasonable diligence cause the summons and complaint to be personally delivered to the person to be served and has failed to meet his burden of showing by a preponderance of the evidence that the service was effected at an address which is defendant’s usual place of business. The default is accordingly void and was properly vacated and set aside as void based on improper service of summons.

It appears from the file that this motion was ordered to be taken off calendar. To the extent plaintiff intended to keep the motion on calendar, the Court has considered the motion, and it is DENIED.

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