JOSIE DEWALT MARTINEZ VS. ZOILA TORRES, ET AL.

Tentative Rulings

Case Number: ****7795 Hearing Date: July 8, 2021 Dept: F47

Dept. F-47

Date: 7/8/21

Case #****7795

MOTION TO SET ASIDE DEFAULT JUDGMENT

Motion filed on 6/11/21.

MOVING PARTY: Defendant AFI Funding, Inc.

RESPONDING PARTY: Plaintiff Josie Dewalt Martinez

NOTICE: ok

RELIEF REQUESTED: An order setting aside the request for default and default judgment entered against Defendant AFI Funding, Inc. in this case.

RULING: The motion is granted. Defendant AFI Funding, Inc. must separately file its Answer to the First Amended Complaint, a copy of which is attached to the motion as Ex.F.

Defendant AFI Funding, Inc. (AFI) is reminded to review the 5/3/19 First Amended General Order Re Mandatory Electronic Filing for Civil. When e-filing documents, parties must comply with the “TECHNICAL REQUIREMENTS” which are set forth at page 4, line 4 through page 5, line 12 of the Court’s 5/3/19 First Amended General Order Re Mandatory Electronic Filing for Civil. See also CRC 3.1110(f)(4). AFI has failed to bookmark the declarations and exhibits attached to the motion. Failure of the parties to comply with these requirements in the future may result in papers being rejected, matters being placed off calendar, matters being continued so documents can be resubmitted in compliance with these requirements, documents not being considered and/or the imposition of sanctions.

On 1/22/18, Plaintiff filed the First Amended Complaint in this action which contains causes of action for: (1) fraud, (2) breach of contract, (3) common counts and (4) conversion. AFI is named as a defendant in the 4^th cause of action for conversion. On 5/21/18, Plaintiff obtained an order allowing her to serve the Office of the Secretary of State for the State of California with the Summons and Complaint as to AFI. On 6/29/18, the Secretary of State was served on behalf of AFI with the service being forwarded to AFI on 7/17/18. On 3/6/20, default judgment was entered against AFI. On 6/11/21, AFI filed and served the instant motion seeking an order setting aside the request for default and default judgment entered against AFI in this case.

CCP 473.5 provides:

(a) 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. 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.

(b) 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.

(c) Upon a finding by the court that the motion was made within the period permitted by subdivision (a) and that his or her lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect, it may set aside the default or default judgment on whatever terms as may be just and allow the party to defend the action.

The Court finds that Plaintiff’s obtaining an order to serve AFI by serving the Secretary of State was appropriate under the circumstances of this case. An agent for the purpose of service of process on Plaintiff could not with reasonable diligence be found at the address designated for personally delivering process at the time service was made as Plaintiff had moved its offices without updating its address with the Secretary of State . See Corp. Code 1702(a); (Berke Decl. and Ex.A and B thereto). However, AFI has provided sufficient evidence that service of the summons and First Amended Complaint on the Secretary of State did result not in its actual notice of the action in time to defend and that the lack of actual notice in time to defend was not caused by AFI’s avoidance of service or inexcusable neglect. (See Motion, Ex.B - Blank Decl.; Motion, Ex.E - Okhman Decl.; Reply, Ex.A – Supp. Okhman Decl.); CCP 473.5(a), (b). The Court finds that AFI’s failure to update its address with the Secretary of State amounts to excusable neglect and does not establish that AFI was avoiding service. See CCP 473.5(b), (c).

AFI has filed and served the instant motion for relief from the default judgment within a reasonable time. The motion was filed approximately two months after AFI learned of the default judgment on 3/8/21 and less than two years after the entry of the default judgment. (See Motion, Ex.D); CCP 473.5(a). Additionally, AFI has attached a copy of its proposed Answer to the motion. (See Motion, Ex.F).

Based on the foregoing, the default and default judgment entered against AFI in this action are set aside. AFI is ordered to separately file its Answer to the First Amended Complaint by the end of the day.