Judge: Yolanda Orozco, Case: 22STCV29446, Date: 2023-01-11 Tentative Ruling
Case Number: 22STCV29446 Hearing Date: January 11, 2023 Dept: 31
REQUEST FOR ENTRY
OF DEFAULT JUDGMENT
TENTATIVE RULING
Plaintiff’s request for Default Judgment is CONTINUED
TO FEBRUARY 17, 2023.
On September 09, 2022,
Plaintiff Creditors Adjustment Bureau, Inc. filed a Complaint against
Defendants Boondock, Inc. and Nicholas F. Devane and Does 1 to 10.
The Complaint seeks $46,223.39 in damages
and asserts causes of action for:
1) Open Book Account;
2) Account Stated;
3) Reasonable Value;
4) Breach of Contract; and
5) Personal Guarantee.
Proof of Service by Substituted Service on
Defendants Boondock, Inc and Nicholas F. Devane was filed on October 24, 2022.
Default was entered against the Defendants
on December 14, 2022.
On December 29, 2022, Does 1 to 10 were
dismissed.
Plaintiff now moves for Default Judgment
against the Defendants in the amount of $55,417.85.
LEGAL STANDARD
Code
Civil Procedure section 585 permits entry of a judgment after a Defendant has
failed to timely answer after being properly served. 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; (7) a dismissal of all parties
against whom judgment is not sought or an application for separate judgment
under the Code of Civil Procedure section 579, supported by a showing of
grounds for each judgment; (8) exhibits as necessary; and (9) a request for
attorneys’ fees if allowed by statute or by the agreement of the parties. (Cal. Rules of Court, rule 3.1800.)
DISCUSSION
Plaintiff requests judgment in the amount of
$55,417.85 against the Defendants. The Judgment is composed of $46,223.39 in
damages, $5,378.44 in interest at 18% per annum, $3,043.40 in attorney’s fees,
and $772.62 in costs.
Forest Plywood Sales entered into a Written
Agreement /Credit Application with Defendants, wherein Forest Plywood agreed to
sell and deliver goods and/or render services. (Mendez Decl. ¶ 4, Ex. 1.)
Defendants breached the Written Agreement/Credit Application by failing to pay
in the amount of $46,223.39. (Id. ¶¶ 5, 6., Ex. 2) Forest Plywood
assigned the debt to Plaintiff. (Compl. ¶ 4, Mendez Decl. ¶ 9.) Plaintiff
attaches copies of the Written Agreement /Credit Application along with a copy
of the Defendants’ Final Statement showing that $46,223.39 are owed. (Mendez
Decl. Ex. 1, 2.)
The Court agrees that Plaintiff has
sufficiently shown that Defendants owe $46,2223.39 in damages.
Plaintiff states that the Written Agreement /Credit Application contains a clause stating that the non-prevailing party agrees to pay reasonable attorney fees and costs in the event of a breach. The clause in question states:
“Should suit be instituted to collect any debs of the undersigned, the undersigned agrees to pay all actual costs of collection, attorney’s fees and interest on the past due amount in the highest rate legally available.”
(Mendez Decl. Ex. 1.)
Accordingly, Plaintiff’s counsel was employed to collect the debt
owed. Plaintiff’s counsel’s hourly billing rate is $500.00 per hour and
Plaintiff’s counsel requests attorney’s fees in the amount of $3,043.40. (Gowey
Decl. ¶ 7.)
Costs are calculated to be $772.62 in total,
including filing fees and process server fees.
Accordingly, the Court agrees that attorney’s
fees in the amount of $3,043.40 and costs in the amount of $772.62 are
warranted by the evidence provided.
Plaintiff’s Complaint alleges that Defendants owe a debt with interest set at 10% per annum and in other portions of the Complaint alleges the interest rate is 18% per annum. (Compare Compl. ¶¶ 1, 13, 16 with ¶¶ 20, 29.)
Plaintiff’s Declaration of Kathleen Mendez, Credit Manager for Forest Plywood Sales, asserts that the interest rate is 18% per annum. (Mendez Decl. ¶ 10.) Plaintiff’s counsel provides an interest computation set at 18% per annum.
The issue is that neither the Complaint nor the Written Agreement /Credit Application show what the applicable interest rate is or what the Defendants agreed that interest rate would be.
The Written Agreement /Credit Application states: “All invoices not paid within thirty days are subject to a 1.5% per month service charge retroactive to the date of delivery.” (Mendez Decl. Ex. 1.) The Written Agreement /Credit Application only states that should there be a suit to collect the debt the interest charged will be “the highest rate legally available.” (Id.)
Plaintiff offers no explanation as to use of an interest rate was set at 18% per annum rather than 10% per annum. As stated, the Complaint references both a 10% and an 18% interest rate. The Court is not persuaded that Defendants had proper notice of what interest rate would be applied to their debt in case of default.
The request for entry of Default Judgment in the amount of $55,417.85 is denied without prejudice to Plaintiff supplying additional evidence to support an 18% interest rate or agreeing to a 10% rate. The hearing on this matter is continued to permit Plaintiff to file additional evidence or declaration. Any changed request will require a new form of judgment that reflects the changes.
Conclusion
Plaintiff’s request for Default Judgment is CONTINUED
TO FEBRUARY 17, 2023.