Judge: Yolanda Orozco, Case: 22STCV06438, Date: 2022-10-26 Tentative Ruling
Case Number: 22STCV06438 Hearing Date: October 26, 2022 Dept: 31
MOTION TO SET ASIDE OR VACATE DEFAULT IS GRANTED
Background
On February 22, 2022, Plaintiff Sunset and Vine Apartments, LLC filed a Complaint against Defendants Guardian Advisors LLC; AKBH LLC, Urbino Construction Inc.; A1 MC Engineering and Shotcrete; Anthony Keshishian; Falcon Quijano; Amir Pirbadian; and Does 1 to 30.
The Complaint alleges causes of action for:
1) Removal of Lateral and Subjacent Support (Civ. Code § 832)
2) Negligence
3) Private Nuisance and Request for Temporary Shoring; and
4) Public Nuisance and Request for Temporary Shoring
On April 29, 2022, Defendant Urbino Construction Inc. filed a Cross-Complaint against Roes 1 to 50 for:
1) Equitable Indemnity;
2) Partial Equitable Indemnity;
3) Express Indemnity;
4) Negligence;
5) Contribution and Repayment; and
6) Declaratory Relief.
On May 04, 2022, Defendant A1 MC Engineering and Shotcrete filed a Cross-Complaint against Zoes 1 to 100 for:
1) Equitable Indemnity;
2) Contribution; and
3) Declaratory Relief.
On June 24, 2022, Defendant Anthony Keshishian filed a Cross-Complaint against Guardian Advisors LLC; AKBH LLC, and Woes 1 to 50 for:
1) Declaratory Relief Against Guardian Advisors;
2) Express Indemnity;
3) Total Equitable Indemnity;
4) Partial Equitable Indemnity;
5) Contribution; and
6) Declaratory Relief.
On July 20, 2022, default was entered against Defendants Guardian Advisors LLC and AKBH LLC.
On August 24, 2022, Defendants Guardian Advisors LLC and AKBH (collectively “Defendants”) filed a Motion to Set Aside Default.
Plaintiff filed opposing papers on October 11, 2022. Defendants filed a reply.
Legal Standard
“Section 473(b) provides for both discretionary and mandatory relief.¿ [Citation.]”¿ (Pagnini v. Union Bank, N.A. (2018) 28 Cal.App.5th 298, 302.)¿ An application for relief under this section must be made no more than six months after entry of the judgment, dismissal, order, or other proceeding from which relief is sought and must be accompanied by an affidavit of fault attesting to the mistake, inadvertence, surprise or neglect of the moving party or its attorney. (Code Civ. Proc., § 473, subd. (b); English v. IKON Business Solutions (2001) 94 Cal.App.4th 130, 143.) In addition, an application for relief under this section “shall be accompanied by a copy of the answer or other pleading proposed to be filed herein, otherwise the application shall not be granted.” (Code Civ. Proc., § 473, subd. (b).) Relief under this section is mandatory when based on an attorney affidavit of fault; otherwise, it is discretionary. (Id.) When relief from default and default judgment is based on an attorney affidavit of fault, the six-month period starts to run from the date of the entry of the default judgment. (Code Civ. Proc., § 473, sub. (b); Sugasawara v. Newland (1994) 27 Cal.App.4th 294, 295.)¿¿¿
JUDICIAL NOTICE
The Court may take judicial notice of records of any court of record of the United States. (Evid. Code t § 452(d)(2).) 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.)
Plaintiffs request Judicial Notice of the following:
1) Exhibit “1”: Proof of Service of Summons on AKBH
2) Exhibit “2”: Proof of Service of Summons on GUARDIAN ADVISORS
3) Exhibit “3”: Request for Entry of Default Re: AKBH and GUARDIAN ADVISORS
Plaintiffs’ request for Judicial Notice is GRANTED.
Discussion
Defendants Guardian Advisors LLC and AKBH seek to set aside default on the basis that their insurer failed to appoint counsel to file a responsive pleading resulting in the entry of default. Defendants now move to set aside the default and have submitted a copy of the proposed pleadings.
Plaintiffs assert that Defendants have failed to show that the insurance carrier’s delay in assigning an attorney is excusable since Defendants took a wait-and-see approach rather than responding to the summons.
Plaintiffs also assert they have been prejudiced by the Defendants’ conduct, including their refusal to protect Plaintiffs property during the pendency of this case, including providing construction documents or refusal to undertake vibration monitoring on the Subject Property. Plaintiffs denied Defendants’ request for a stipulation when Defendants refused to submit the construction documents Plaintiffs requested. Moreover, Plaintiffs ask that if this instant motion is granted, Defendants be required to provide the Construction Documents as a condition for setting aside the default.
Defense counsel submitted a declaration attesting that his prior communications with Plaintiffs’ counsel were due to the business relationship between Urbino Construction Inc. and the Defendants. (Gnesin Supp. Decl. ¶ 3.) Defense counsel asserts that on May 27, 2022, Plaintiffs’ counsel contacted him and an agreement was reached to allow the Defendants an extension until June 22, 2022, to file a responsive pleading. (Id. ¶ 5.) Defense counsel believed arrangements would be made by Defendants and took no further steps to obtain an extension. (Id. ¶ 6.) By June 22, 2022, defense counsel had not heard from the Defendants regarding his authority to answer Plaintiff’s complaint on their behalf or request further extensions. (Id.) Therefore, it was through defense counsel’s mistake, inadvertence and neglect that default was entered against Defendants. (Id.)
Defense counsel asserts that it was not until July 28, 2022, that Next Insurance Company instructed defense counsel to appear on behalf of Defendants. (Gnesin Decl. ¶ 5.)
Defense counsel asserts that Plaintiffs have not propounded any written discovery. (Gnesin Supp. Decl. ¶ 7.) Therefore, if default is set aside, any prejudice Plaintiffs claim will dissipate as they will be able to engage in formal discovery.
Given that the Defendants’ motion was timely brought within six months as required by Section 473(b) and that the parties were awaiting confirmation from their insurance carrier, Defendants’ Motion to Set Aside Default is GRANTED consistent with the policy favoring disposing of cases on the merits, (See Taliaferro v. Taliaferro (1963) 217 Cal.App.2d 216, 220 [“It is the policy of the law that every case should be heard upon the merits where possible; that a motion to set aside a default is one addressed to the sound discretion of the court; that the ruling on such motion will not be reversed in the absence of a clear showing of abuse of discretion; that section 473 is a remedial provision to be liberally construed to the end that cases be disposed of upon their merits.”].)
In addition, no substantive prejudice has been shown.
Conclusion
For all the reasons stated, the default entered on July 20, 2022, default against Defendants Guardian Advisors LLC and AKBH LLCC is VACATED.
Defendants must separately file their answer to Plaintiffs’ Complaint within 20 days..
The moving party to give notice.