MONTROSE PROPERTY LLC VS SWORK COFFEE INC ET AL

Tentative Rulings

Case Number: BC414013    Hearing Date: August 10, 2020    Dept: 31

MOTION TO SET ASIDE DEFAULT AND DEFAULT JUDGMENT IS GRANTED.

Relevant Background

On May 19, 2009, Plaintiff Montrose Property, LLC filed the instant action against Defendants Swork Coffee, Inc.; Patricia Neale; Yoojin Lee dba Paradiso Café; Wong J. Kong; and Does 1 through 30. The Complaint asserts causes of action for:

1. Breach of Contract (against Swork Coffee, Inc. & Lee);

2. Breach of Contract (against Swork Coffee, Inc. & Lee);

3. Breach of Contract (against Swork Coffee, Inc. & Lee);

4. Breach of Contract (against Swork Coffee, Inc. & Lee);

5. Breach of Guaranty (against Neale); and

6. Breach of Guaranty (against Kong).

On August 18, 2009, default was entered as to Defendant Patricia Neale. Judgment was entered against Defendant Neale on September 14, 2010. On February 2, 2011, an amended judgment was entered. On June 13, 2012, a further amended judgment was entered.

Defendant Patricia Vaugniaux (hereinafter “Defendant”), erroneously sued as Patricia Neale, moves for an order setting aside the default and judgment entered against her and allowing her to file her Answer to Plaintiff’s complaint.

Legal Standard

The court has broad discretion to set aside the entry of default, default judgment, or a dismissal, but that discretion can be exercised only if the defendant establishes a proper ground for relief, by the proper procedure and within the set time limits. 

CCP § 473(b) provides, in relevant part:

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.

Alternatively, pursuant to CCP § 473.5, a defendant may obtain relief by showing “service of a summons has not resulted in actual notice to a party in time to defend the action.” Relief must be sought “within a reasonable time, but in no event exceeding” 2 years after entry of the default judgment or 180 days after service of written notice that the default or default judgment has been entered, whichever is earlier.

Finally, CCP § 473(d) provides that “[t]he court may . . . on motion of either party after notice to the other party, set aside any void judgment or order.” (CCP § 473(d).) Default judgment is void against a defendant who was not served with a summons in the manner prescribed by statute. (See Sakaguchi v. Sakaguchi (2009) 173 Cal.App.4th 852, 858.) A judgment void on its face—meaning where the invalidity is ‘apparent upon an inspection of the judgment-roll’, which includes the proof of service (CCP § 670(a))—may be set aside pursuant to section 473(d) at any time. (See Manson, Iver & York v. Black (2009) 176 Cal.App.4th 36, 42.) Where a judgment is valid on its face, but is nevertheless deemed void after considering evidence beyond the judgment, the motion must be brought within the same time as a motion brought under CCP § 473.5. (See Rogers v. Silverman (1989) 216 Cal.App.3d 1114.)

Discussion

Moving under Code of Civil Procedure section 473 (b), Defendant argues that at no time was she personally served with a Summons and Complaint in this action and therefore lacked notice of Plaintiff’s claim against her. Defendant asserts that as a result of Plaintiff’s failure to properly serve her with the Summons and Complaint, Defendant was without proper notice that she was a party to the lawsuit, was therefore prevented an opportunity to timely seek and retain legal assistance on the matter, and was surprised to discover such only after a levy upon her bank account. 

In opposition, Plaintiff argues that because Defendant moves solely under Section 437(b), her motion is untimely as it was filed nine years after the deadline, and Section 437(b) requires that relief be sought within six months. Plaintiff asserts that in any event, Defendant does not meet her burden under the statute. Plaintiff contends that Defendant’s declaration simply states that she was not personally served with the summons and complaint, and then makes several conclusory allegations that because of a lack of personal service, she was “unaware of the need to secure legal counsel.” Plaintiff argues that Defendant notably says nothing about whether she was served in any other manner or had any actual or constructive notice of the lawsuit, which was litigated between other parties to trial before judgment was entered against Defendant. Plaintiff asserts that, moreover, if Defendant did receive any such notice, Defendant fails to provide specific facts explaining why she elected to ignore the case. Plaintiff contends that instead, it is apparent that although Defendant was served in 2009 and did receive notice of the action, Defendant simply chose to ignore it at the time and in the eleven years since, until Plaintiff was finally able to enforce the judgment against her.

The Court finds that Defendant is entitled to relief under Section 437(d). While Plaintiff is correct that Defendant moves solely under Section 437(b), it appears to the Court that Plaintiff’s arguments are intended to be brought under 437(d), as Defendant makes arguments about proper service of the summons and complaint. Pursuant to Section 128(a)(8), every court has the power to amend and control its process and orders so at to make them conform to law and justice. Based on this authority, the Court construes Defendant’s motion as a motion under Section 437(d) and analyzes it accordingly.

Here, upon review of the Proof of Service and Default entered against Defendant filed on August 17, 2009 and August 18, 2000, respectively, the default is void on its face. The Proof of Service filed on August 17, 2009 indicates that the party served was a “Patricia Neal, an individual.” The name of the party according to the Request for Entry of Default and the Complaint is “Patricia Neale.” Because the name on the Proof of Service, Complaint, and Request for Entry of Default differ, default should never have been entered against Patricia Neale. Thus, the default and judgment entered against Defendant is void and the Court has the authority to set it aside. Moreover, because setting aside a void default is done pursuant to Section 437(d), a default may be set aside at any time. Defendant’s motion is therefore timely.

Based on the foregoing, Defendant’s motion to set aside default and default judgment is GRANTED. 

Conclusion

Defendant’s motion to set aside default and default judgment is GRANTED. On the Court’s own motion, the Answer filed on March 20, 2020 by Defendant is STRICKEN as improperly filed. Defendant is ordered to file her Answer within 10 days of this Order.

Moving party to give notice.

The parties are strongly encouraged to attend all scheduled hearings virtually or by audio. Effective July 20, 2020, all matters will be scheduled virtually and/or with audio through the Court’s LACourtConnect technology. The parties are strongly encouraged to use LACourtConnect for all their matters. All social distancing protocols will be observed at the Courthouse and in the courtrooms.

Case Number: BC414013    Hearing Date: July 16, 2020    Dept: 31

MOTION TO SET ASIDE DEFAULT JUDGEMENT IS CONTINUED.

If Defendant intends to have the motion heard on the merits, Defendant must serve the moving papers on Plaintiff no later than the time prescribed by Code of Civil Procedure section 1005(b) and file a Proof of Service indicating the same pursuant to California Rules of Court Rule 3.1300(c).

Effective July 20, 2020, all matters will be scheduled virtually and with audio through the Court’s LAConnect technology and the parties are strongly encouraged to use LAConnect. All social distancing protocols will be observed at the Courthouse and in the courtrooms.