TIE JUN ZHOU VS CHEN WEI ET AL

Tentative Rulings

Case Number: BC626381    Hearing Date: April 30, 2021    Dept: 40

MOVING PARTY: Cross-Defendant Hong Du

OPPOSITION: Cross-Complainants Chen Wei, Liu Qing, and Yong Dong, Inc.

This motion involves cross-complainant Chen Wei (“Wei”) and his wife Liu Qing investing in Yong Dong Inc., a flooring sales and installation business run by Wei’s friend Tie Jun Zhou. The business was not successful and Wei alleges that Zhou deceived him about its inventory, which was actually owned by Hong Du (“Du”), Zhou’s girlfriend, who had her own flooring business called Stylish. Zhou also allegedly worked on behalf of his own separate business and Du’s business while working for Yong Dong.

In January 2020, this Court entered a default judgment against Du, who now requests this set-aside on the ground that she was not served with a copy of the summons and complaint.

Standard: “When service of a summons has not resulted in actual notice to a party in time to defend the action and a default or default judgment has been entered against him or her in the action, he or she may serve and file a notice of motion to set aside the default or default judgment and for leave to defend the action.” (CCP § 473.5(a).)

The notice of motion shall be served and filed within a reasonable time, but in no event exceeding the earlier of (i) two years after entry of a default judgment against him or her; or (ii) 180 days after service on him or her of a written notice that the default or default judgment has been entered.” (Ibid.) “A notice of motion to set aside a default or default judgment and for leave to defend the action shall designate as the time for making the motion a date prescribed by subdivision (b) of Section 1005, and it shall be accompanied by an affidavit showing under oath that the party’s lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect. The party shall serve and file with the notice a copy of the answer, motion, or other pleading proposed to be filed in the action.” (Id. § 473.5(b).)

DENIED

Du says she was not served with a copy of the summons and complaint. The documents show Du was served the summons and complaint by substitute service on Sep. 19, 2016 (Opp’n., Ex. A), and the person served was an employee of Stylish, Du’s business. Du argues that she did not have notice of the lawsuit against her until December 2020, when she received the Levy and Writ of Execution. But Du’s argument is contradicted by the fact that around Oct. 2016, she retained an attorney to represent her in this case.

Meridith L. Caliman (“Caliman”), an attorney, sent several emails to Wei’s counsel from Oct. 2016 to Dec. 2016, stating that she represented both Stylish and Du and discussing various issues in the case. (Opp’n., Exs. B-G.) Caliman’s first email said, “this office represents Hong Du and Stylish Hardware pertaining to the cross-complaint filed in this above-referenced action.” (Id. at Ex. C.) Caliman’s final Dec. 2016 email said, “this is to inform you that Hong Du and Stylish Hardwood will be represented by another attorney…. Ms Du wants an attorney who speaks Mandarin so she can more easily communicate with her counsel….I have informed Ms Du of the upcoming deadlines….” (Id. at Ex. G.)

While “actual knowledge from a source other than service of summons” does not prevent a defendant from requesting relief, the court can still find that Du is not entitled to set aside the judgment. Ellard v. Conway (2001) 94 Cal.App.4th 540, 548. In Ellard, the self-represented defendant, who like Du disputed that he was properly served by substitute service, called opposing counsel to discuss the case; referenced the case number; and tried to settle the case. These were all indicators that the defendant had actual notice. (Id. at p. 458.)

Here, there are several indicators that Du had actual knowledge about the cross-complaint against her: Du retained counsel who represented her in the cross-complaint, Du’s counsel asked her about questions raised by opposing counsel (Opp’n., Ex. F), and Du was informed about the deadline for the response to the cross-complaint.

Accordingly, the Court finds that Du purposefully neglected to participate in this case despite having actual notice of it since 2016.

Conclusion: Du’s Motion to Set Aside Judgment is DENIED.

Case Number: BC626381    Hearing Date: December 20, 2019    Dept: 40

DEFAULT JUDGMENT PROVE-UP CHECKLIST

(CRC Rule 3.1800)

Case Name: Tie Jun Zhou v. Chen Wei

Case #: BC626381

Hearing Date: 12/20/19, re Entry of Default Judgment

Moving Party: Cross-Complainants Chen Wei, Liu Qing, and Yong Dong, Inc.

Defaulting Party: Cross-Defendants Hong Du & Stylish Hardwood, Inc.,

Total Amount: $250,760.24

BACKGROUND: Originally Plaintiff Tie Jun Zhou (“Zhou”) filed a Complaint against

Defendants Chen Wei (“Wei”), Liu Qing, and Yong Dong, Inc. (collectively, “Cross-Complainants”) over a failed business venture. Cross-complainants then filed a cross complaint adding Cross-Defendants Hong Du (“Du”) & Stylish Hardwood, Inc. to the action. Plaintiff and Cross-complainants settled their issues and dismissed the cases against each other. Only the action against Cross-Defendants remains.

Zhou wanted Wei to invest in Yong Dong, a flooring sales and installation business. Du was Zhou’s girlfriend who had her own business, Stylish. Wei was reluctant to work with Zhou because of his volatile relationship with Du. Eventually, Zhou and Wei agreed to go into business together.

The business collapsed. Du claimed that the flooring inventory possessed by Zhou was actually hers and took it. Wei claims that while Yong Dong existed, Zhou was setting up his own company and invoicing materials and labor to Yong Dong but keeping the proceeds for himself. Wei alleges that Du and Stylish conspired with Zhou. Wei is claiming as damages the capital he invested in the company and the outstanding debt.

[X] DEFAULT ENTERED ON: 1/11/17 for Hong Du and Stylish Hardwood. Inc.

[X] MANDATORY JUDICIAL COUNCIL FORM CIV-100 SUBMITTED FOR ENTRY OF COURT JUDGMENT (CRC 3.1800(a))

[X] SERVICE:

Complaint and Summons

• On September 28, 2016, Cross-Defendants were served the cross-complaint and summons via substituted service at via mail at 20885 Carrier Road, Walnut, CA 91789.

[X] DECLARATION OF MAILING -- Request for Entry of Default to Defendant (CCP § 587)

• Mailed to Cross-Defendants at 20885 Carrier Road, Walnut, CA 91789 on July 9, 2019.

[X] NO PENDING MOTION TO VACATE DEFAULT

[X] SUMMARY OF CASE PROVIDED (CRC 3.1800(a)(1)) - or other declaration OK [ ]

• No summary of case provided.

[X] EVIDENTIARY DECLARATIONS/OTHER EVIDENCE (CRC 3.1800(a)(2))

• A declaration from Wei has been provided. Wei states that he seeks $5,000 from Cross-Defendants their conversion of the flooring materials, $143,000 in monetary capital, and 100,000 in outstanding credit card debts. (Decl. Wei.)

[X] RELIEF PRAYED FOR IN COMPLAINT (same as requested in default?): [X] yes[ ] no

[X] Compensatory: $ 248,449.00

[ ] Damages

Special: $

General: $

[ ] Interest: $

[X] Costs: $ 2,311.24

[X] Attorney’ Fees: $

Total: $ 250,760.24

[n/a] INTEREST COMPUTATIONS (CRC 3.1800(a)(3))

[ ] ATTORNEY FEE DECLARATION -- Request according to Local Rule 3.214 or reason provided why greater fees should be allowed (CRC 3.1800(b))

[ ] Request for atty fees allowed by statute or agreement of parties (CRC

[ ] $960/$1,200 for book account claim (Civil Code § 1717.5)

• No declaration provided.

[X] MEMORANDUM OF COSTS (CRC 3.1800(a)(4))

[n/a] STATEMENT OF DAMAGES (CCP § 425.11):

[ ] PI/Death Case [ ] Punitives demanded [ ] Accounting

[ ] Evidence of net worth of defendant? [ ] Yes [ ] No

[X] DECLARATION OF NON-MILITARY STATUS executed within 6 months?

Date: 7-9-19 (CRC 3.1800(a)(5); Interinsurance Exchange v. Collins (1994) 30 Cal.App.4th 1445, 1447.)

[X] REQUEST FOR DISMISSAL OF DOES (CRC 3.1800(a)(7))

[ ] If not, authority/basis for several judgment (CCP § 579)

[n/a] WAS DEFAULTING DEFENDANT A DOE? (CCP § 474) - must do one of the following:

[ ] Summons notifies defendant that s/he was served under a fictitious name

[ ] Proof of service states that the Doe amendment form was served with the complaint

[ ] Complaint amended to reflect the true defendant’s name & allegations support claim

[X] ORIGINALS Promissory note or other written obligation to pay money must be provided for cancellation by the Clerk per CRC 3.1806

[ ] If no originals, declaration explaining loss/destruction/unavailability of originals

[ ] Proposed order for Court to accept authenticated copy in lieu of original

[X] PROPOSED FORM OF JUDGMENT INCLUDED (CRC 3.1800(a)(6))

RECOMMENDATION: Deny

TENTATIVE RULING: Nine of Cross-Complainant’s causes of action contain a demand for $198.517. They are seeking $143,000 in monetary capital and $100,000 in outstanding credit card debts. However, they do not state for which cause of action each of those sums is for. They state that they seek $5,000 in conversion but that cause of action asks for damages according to proof.

Therefore, the Court will award $198,517 (the maximum amount requested in nine of the causes of action) or $245,760.24, the requested sum minus the conversion claim, depending upon if they specify what causes of action they are requesting the monies for.