Judge: Salvatore Sirna, Case: 24PSCV01135, Date: 2024-11-07 Tentative Ruling

Case Number: 24PSCV01135    Hearing Date: November 7, 2024    Dept: G

Plaintiff Developers Surety and Indemnity Company’s Application for Default Judgment

Respondent: NO OPPOSITION

TENTATIVE RULING

Plaintiff Developers Surety and Indemnity Company’s Application for Default Judgment is DENIED without prejudice.

BACKGROUND

This is a breach of contract action arising from an indemnity agreement. In January 2023, Plaintiff Developers Surety and Indemnity Company (Developers) entered into an indemnity agreement with Defendants Stance Construction Company (Stance) and Ahmad Elrabaa in which they promised to indemnify Developers in connection with Developers’ issuance of bonds on their behalf. Subsequently, Developers issued payment and performance bonds for a series of public works projects. After Stance and Elrabaa allegedly failed to satisfactorily perform their contractual obligations with regards to these projects and Developers received claims from the bond principals, Stance and Elrabaa allegedly failed to indemnify Developers.

On April 10, 2024, Developers filed a complaint against Stance, Elrabaa, and Does 1-100 alleging the following causes of action: (1) breach of contract, (2) specific performance, and (4) quia timet. On April 15, 2024, Developers’ process server personally served Stance in Sacramento. On May 22, 2024, Developers’ process server served Elrabaa with substitute service in Rowland Heights.

On May 28, 2024, the court entered default against Stance after Stance failed to file a timely answer. On July 11, 2024, the court also entered default against Elrabaa after Elrabaa failed to file a timely answer.

On October 22, 2024, Developers submitted the present application for default judgment.

An OSC Re: Default Judgment is set for November 7, 2024.

LEGAL STANDARD

Code of Civil Procedure section 585 permits entry of a default judgment after a party has filed to timely respond or appear.  A party seeking judgment on the default by the court must file a Request for Court Judgment, and: (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 or an application for separate judgment under CCP § 579, supported by a showing of grounds for each judgment; (7) exhibits as necessary; and (8) a request for attorneys’ fees if allowed by statute or by the agreement of the parties.  (Cal. Rules of Court 3.1800.)

ANALYSIS

Developers seeks default judgment against Stance and Elrabaa in the total amount of $646,107.19, including $600,855.54 in damages, $32,100.50 in interest, $11,896.50 in attorney fees, and $1,254.35 in costs. For the following reasons, the court DENIES Developers’ application without prejudice.

A party may not obtain damages in a default judgment that exceed the amount requested in the complaint. (Greenup v. Rodman (1986) 42 Cal.3d 822, 826.) In determining the maximum amount of damages allowable, “courts must look to the prayer of the complaint or to ‘allegations in the body of the complaint of the damages sought’ to determine whether a defendant has been informed of the ‘maximum liability’ he or she will face for choosing to default.” (People ex rel. Lockyer v. Brar (2005) 134 Cal.App.4th 659, 667, quoting National Diversified Services, Inc. v. Bernstein (1985) 168 Cal.App.3d 410, 417-418.) Allegations “according to proof” are insufficient in a default judgment proceeding as they do not inform defendants of their maximum liability. (Yu v. Liberty Surplus Ins. Corp. (2018) 30 Cal.App.5th 1024, 1032.)

Here, while Developers’ default judgment application seeks $600,855.54 in damages, their Complaint fails to allege a specific amount. Thus, Developers’ Complaint cannot support an award of damages in default proceedings and must be amended.

CONCLUSION

Based on the foregoing, Developers’ application for default judgment is DENIED without prejudice.