Judge Yolanda Orozco, Case 21STCV13656 2022-12-08 Tentative Ruling

Judge: Yolanda Orozco, Case: 21STCV13656, Date: 2022-12-08 Tentative Ruling

Case Number: 21STCV13656 Hearing Date: December 8, 2022 Dept: 31

MOTION TO SET ASIDE AND VACATE DISMISSAL

AND STAY ACTION IS GRANTED

Background

On April 12, 2021, James Truby (“Plaintiff”) initiated the instant action by filing a Complaint against Guckenheimer Enterprises, Inc. and Does 1 through 10 (collectively, “Defendants”).

On August 25, 2021, Plaintiff filed the operative Second Amended Complaint against Defendants. Plaintiff’s Second Amended Complaint alleges a single cause of action, “Claim for Civil Penalties for Violation of California’s Private Attorneys General Act of 2004 (Labor Code § 2698, et seq.).” Plaintiff’s Second Amended Complaint prays for the imposition of civil penalties under California’s Private Attorneys General Act (“PAGA”), on behalf of all current and former employees of Defendants, due to Defendants’ violations of Labor Code § 2802, Defendants’ failure to reimburse employees for all expenses necessarily incurred during the course and scope of employment.

On April 22, 2022, Plaintiff requested that the action be STAYED pending the United States Supreme Court’s decision in Viking River Cruises, Inc. v. Moriana (2022) 142 S.Ct. 1906.

On July 18, 2022, Plaintiff voluntarily dismissed his action without prejudice.

On September 22, 2022, Plaintiff moved to Set Aside and Vacate the Dismissal and Stay the Action pending resolution of Plaintiff’s Individual Claims.

Defendant filed opposing papers on November 23, 2022. Plaintiff filed a reply on December 01, 2022.

Legal Standard

California Code of Civil Procedure section 473 subdivision (b) provides for both discretionary and mandatory relief. (See Pagnini v. Union Bank, N.A. (2018) 28 Cal.App.5th 298, 302.) Mandatory relief from default, default judgment, or dismissal is available based on an attorney’s sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect. (Minick v. City of Petaluma (2016) 3 Cal.App.5th 15, 25-26.) Discretionary relief is available based on the party’s own declaration or other evidence showing mistake, inadvertence, surprise, or excusable neglect. (Id.)¿¿

Under the discretionary relief provision, the application for 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.” (Code Civ. Proc., § 473 subd. (b).)

Request for Judicial Notice

“Judicial notice may be taken of the following matters . . . (d) Records of (1) any court of the state or (2) any court of record of the United States.” (Evid. Code § 452 subd. (d); see also Aaronoff v. Martinez-Senftner (2006) 136 Cal.App.4th 910, 918 [holding judicial notice of “any court record” is proper].)¿¿However, the court may only judicially notice the existence of the record, not that its contents are the truth. (Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1565.)

Plaintiff requests Judicial Notice of the following:

Exhibit 1: A true and correct copy of September 1, 2022 Minute Order in Hollman v. AYA Healthcare, Inc., Los Angeles County Superior Court Case No. 21STCV22158.

Exhibit 2: A true and correct copy of the September 15, 2022 Minute Order in Specter v. CSS Payroll Co, L.P, et al., Los Angeles County Superior Court Case No. 22STCV13634.

Exhibit 3: A true and correct copy of the Sept. 12, 2022 Order in Del Cid v. Jonathan Club., Los Angeles County Superior Court, Case No. 20STCV12113.

Exhibit 4: A true and correct copy of the Sept. 20, 2022 Minute Order in Ruiz v. Rizo Lopez Foods, Inc., et al., Stanislaus County Superior Court, Case No. No. CV-20-004053.

Exhibit 5: A true and correct copy of the Sept. 7, 2022 Minute Order in Fernandez v. Prime Healthcare Services, Inc., et al., Los Angeles County Superior Court, Case No. LC106845.

Exhibit 6: A true and correct copy of the Sept. 15, 2022 Minute Order in Santa Cruz v. Sun West Mortgage Company, Inc., Orange County Superior Court, Case No, 30-2022-01239675- CU-OE-CXC.

Exhibit 7: A true and correct copy of October 4, 2022 Minute Order in Flores v. Amwest, Inc., et al., Los Angeles County Superior Court Case No. 21STCV16066.

Exhibit 8: A true and correct copy of the September 8, 2022 Minute Order in Doherty vs. Del Paso Country Club, et al., Sacramento County Superior Court Case No. 34-2022-00313934- CU-OE-GDS.

Plaintiff’s Request for Judicial Notice is GRANTED.

Discussion

Plaintiff seeks relief from his voluntary dismissal of this action based on his attorney’s sworn affidavit attesting to Plaintiff’s counsel’s mistake of law. (See Declaration of Keith Custis.)

Plaintiff’s counsel attests that he relied on the holding in Viking River Cruises, Inc. v. Moriana (2022) 142 S.Ct. 1906, in voluntarily dismissing this action because he believed Plaintiff lacked standing to pursue the representative portion of his PAGA action while his individual PAGA action was in arbitration. (Custis Decl. ¶¶ 8-10.) Counsel for Plaintiff attests that he did not heed Justice Sonia Sotomayor’s warning in her concurring opinion in Viking River that California Courts would have the last word on claims brought under PAGA. (Id. ¶ 11)

Plaintiff’s counsel was also unaware that the plaintiffs in the matter of Adolph v. Uber Technologies, Inc., No. G059860, had petitioned the California Supreme Court to resolve the question of whether an aggrieved employee whose individual PAGA claim has been compelled to arbitration nevertheless maintains standing to pursue the representative portion of the PAGA claim in court. (Id. ¶ 12.) The California Supreme Court granted review of Adolph on July 20, 2022, two days after Plaintiff’s voluntarily dismissed her action.

Plaintiff’s counsel further attests that he did not learn that trial courts when ruling on motions to compel arbitration in PAGA actions, were compelling the individual portion of PAGA claims to arbitration but staying non-individual portions of PAGA claims until around September 08, 2022, when Plaintiff’s counsel attended the California Lawyer’s Association Labor & Employment Law Sections’ 12th Annual Advanced Wage and Hour Conference. (Custis Decl. ¶ 13.) This instant motion was filed two weeks later after the conference, and two months after the voluntary dismissal was entered on July 18, 2022. (Id. ¶ 14.)

Mistake of Law

“‘It is well settled that relief may be granted for mistake of law by a party's attorney. [Citation.] An honest mistake of law is a valid ground for relief where a problem is complex and debatable.’” (McCormick v. Board of Supervisors (1988) 198 Cal.App.3d 352, 360 citing Brochtrup v. INTEP (1987) 190 Cal.App.3d 323, 329.) “The controlling factors in determining whether an attorney's mistake was excusable are (1) the reasonableness of the misconception and (2) the justifiability of the failure to determine the correct law.” (McCormick, supra, 198 Cal.App.3d at 329.)

The fact that the California Supreme Court has granted review of Adolph v. Uber Technologies, Inc. shows the law is not fully settled as to whether a plaintiff whose individual claims are in arbitration has the standing to maintain a representative PAGA action in court. Therefore, the Court finds that Plaintiff’s counsel’s mistake is excusable because it related to a problem that is “complex and debatable.” (McCormick, supra, 198 Cal.App.3d at 360 [internal citations omitted].) “[W]here the law is not yet established attorneys cannot be expected to be omniscient.” (Id. at 362.)

Plaintiff is Entitled to Discretionary Relief Under § 473(b)

Although Plaintiff seeks relief under both the discretionary and mandatory provisions of the Code of Civil Procedure section 473 subdivision (b), only discretionary relief is available when a plaintiff voluntarily dismisses his or her action. (See Jackson v. Kaiser Foundation Hospitals, Inc. (2019) 32 Cal.App.5th 166, 176 [“we conclude mandatory relief is unavailable to undo Jackson's voluntary dismissal of her action, even assuming the dismissal was due to her attorney's erroneous advice.”]

Under the discretionary relief provision of section 473 subdivision (b):

“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.”

(Code Civ. Proc., § 473 subd. (b).)

Plaintiff’s declaration for relief was made shortly after Plaintiff’s counsel learned of his mistake and within the six months limitation. The application for relief is also accompanied by the pleading proposed, the Second Amended Complaint that was filed on August 25, 2021. (Custis Decl. ¶ 4, Ex. 2.) Moreover, Plaintiff’s counsel has sufficiently attested to his own mistake in seeking the dismissal of this action. “[T]he law strongly favors trial and disposition on the merits, any doubts in applying section 473 must be resolved in favor of the party seeking relief from default [Citations].” (McCormick, supra, 198 Cal.App.3d at 360 [granting discretionary relief under section 473(b) to a dismissal caused by counsel’s mistake of law.].)

Section 473 “is remedial in its nature and is to be liberally constructed.” (Reed v. Williamson (1960) 185 Cal.App.2d 244, 248.) The statute’s purpose “is to promote the determination of actions on their merits.” (Even Zohar Const. & Remodeling, Inc. v. Bellaire Townhouses, LLC (2015) 61 Cal.4th 830, 839.) “‘[W]hen relief under section 473¿is¿available, there is a strong¿public¿policy¿in¿favor¿of granting relief and allowing the requesting party his or her day in court. Beyond this period there is a strong¿public¿policy¿in¿favor¿of the¿finality¿of¿judgments¿and only in exceptional circumstances should relief be granted.’¿ [Citations.]” (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 981–982.)

“A trial court's ruling granting discretionary relief under¿section 473, subdivision (b)¿‘shall not be disturbed on appeal absent a clear showing of abuse.’ (Citation.) The scope of the trial court's discretion under section 473 is broad and its factual findings in the exercise of that discretion are entitled to deference.” (Minick v. City of Petaluma¿(2016) 3 Cal.App.5th 15, 24.)

For all of the stated reasons, the Court GRANTS Plaintiff’s Motion to Set Aside the Dismissal.

Defendant’s Opposition to Vacate the Dismissal

Defendant’s argument that the Court lacks jurisdiction to set aside a voluntary dismissal under section 473 is without merit. Moreover, Defendant’s request for attorney’s fees for preparing and opposing this motion is DENIED.

Attorney’s fees are only authorized when allowed by contract, statute, or law. (Code of Civ. Proc., § 1033.5 subd. (a)(10).) Fees under section 473 subdivision (b) based on an attorney’s affidavit of fault are only mandatory when the relief is granted under the mandatory provision of section 473. (Martin Potts & Associates, Inc. v. Corsair, LLC (2016) 244 Cal.App.4th 432, 438 [“mandatory relief comes with a price—namely, the duty to pay ‘reasonable compensatory legal fees and costs to opposing counsel or parties’ (§ 473, subd. (b).).”].)

Plaintiff’s Request to Stay the Action

Pursuant to an arbitration agreement, Plaintiff filed a demand for arbitration with JAMS to arbitrate his individual claims, including his individual PAGA claim. (Custis Decl. ¶ 3, 5. Ex. 3.) Plaintiff asserts he has standing to assert a non-individual representative PAGA action under Kim v. Reins International California, Inc.¿(2020) 9 Cal.5th 73. Plaintiff requests that the non-individual representative PAGA action be stayed pending arbitration of Plaintiff’s individual claims. The Court agrees.

Since Defendant has not stated any basis for objection to the stay of this action pending Plaintiff’s arbitration of Plaintiff’s individual claims, the request to stay the action is GRANTED.

Conclusion

plaintiff’s Motion to Set Aside and Vacate the Dismissal and stay the action is GRANTED.

The Court will set a Status Conference on August 3, 2022, at 9 a.m., at which time the parties are to report on the progress on the arbitration.

Moving party to give notice.