Stardust Real Estate & Loans v. Maduakolam

Filed 12/30/08 Stardust Real Estate & Loans v. Maduakolam CA1/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION ONE

Stardust Real Estate & Loans (Stardust), plaintiff and cross-defendant below, appeals from an order denying it relief from default on the amended cross-complaint filed by defendant Johnetta Maduakolam. Stardust argues the trial court should have granted relief for excusable neglect or attorney fault. We disagree for the reasons set forth below. Accordingly, we affirm.

I. PROCEDURAL BACKGROUND AND FACTS

We set forth the basic facts of this case with the following procedural chronology.

August 11, 2005: Stardust, represented by the Law Offices of Martin Deutsch, files a complaint against defendant Maduakolam, seeking damages for breach of contract and common counts.

October 26, 2005: Maduakolam, in propria persona, files an answer to the complaint and a cross-complaint for fraud.

February 1, 2006: Stardust files an answer to the original cross-complaint.

May 17, 2006: Maduakolam, now represented by attorney William C. Dresser, files an amended cross-complaint against Stardust, seeking damages for breach of contract, general negligence, intentional tort, fraud, and common counts. The amended cross-complaint adds Bill Miller, the solo proprietor of Stardust, as a second defendant.

At some point, according to a declaration of Dresser filed below, the amended cross-complaint was personally served on Sosan Akbar, an attorney of the Law Offices of Martin Deutsch, as counsel of record for Stardust.

August 1, 2006: Dresser writes to Akbar, noting her responsive pleading to the amended cross-complaint was due July 31, 2006, but had not been filed. Dresser granted an extension of time to file until August 16, but indicated I . . . cannot wait any longer. Trial was set for October 6, 2006.

September 11, 2006: Dresser writes Akbar, memorializing a phone conversation in which she apparently said she would file a responsive pleading today.

September 21, 2006: The Alameda County clerk receives from Akbar what was purportedly a general denial to the amended cross-complaint, but which referred only to the plaintiffs complaint. For reasons that are not clear, the clerk did not accept the general denial for filing, but marked it Received. The Received date stamp was crossed out, and the crossing-out was initialed―presumably by a deputy clerk.

In a declaration filed below, Akbar stated that the general denial was returned to her without any notice as to why [it] was being rejected―but she did not realize that the general denial was not filed.

Akbar stated that she personally served Dresser with the general denial at a September 21, 2006 settlement conference. In a declaration filed below, Dresser denied any service on him of the general denial or any responsive pleading to the amended cross-complaint.

November 2006: According to Akbars declaration, the Law Offices of Martin Deutsch were substituted out by the trustee of Bill Millers trust. Miller had died on March 22.

April 17, 2007: Dresser requests entry of default on the amended cross-complaint, and default is entered that date.

October 2007: Akbar is re-retained, reviews the Alameda County Superior Court Web site, and discovers the April 17, 2007 default.

January 23, 2008: Akbar files a motion for relief from default. Akbar sought relief under Code of Civil Procedure section 473, subdivision (d), on the ground of clerical error as [t]he only possible reason why the general denial was rejected.[1] Akbar also sought relief on the equitable ground of extrinsic mistake, apparently a reference to the clerks rejection of the general denial.

February 13, 2008: Dresser files an opposition to the motion, refuting clerical error and extrinsic mistake as grounds for relief, and arguing the default was proper because the general denial, or any other responsive pleading, was not filed and served.

February 27, 2008: The trial court holds a hearing on the motion and states on the record that no general denial was ever filed. The court denied the motion, ruling that Stardust has not established a basis to set aside the default entered . . . on April 17, 2007. The court denied the motion without prejudice, apparently because Akbar indicated a desire to file a second motion based on section 473(b).

March 12, 2008: Akbar files a second motion to set aside the default. Akbar declared, apparently for the first time, that when she received the general denial marked Received, she thought the original had been filed and a copy was being returned. She sought relief under section 473(b), based on mistake, inadvertence, surprise, or excusable neglect. She repeated her claim for equitable relief based on extrinsic mistake, and also briefly mentioned section 473.5.

March 26, 2008: Dresser opposes the second motion, arguing the request for relief under section 473(b) was untimely, that there was no extrinsic fraud or mistake, and that section 473.5 did not apply. Dresser again emphasized that no responsive pleading had ever been filed or served. He also argued the second motion was an improper motion for reconsideration.

April 8, 2008: The trial court denies the second motion. The court ruled that Stardust has still failed to present a basis on which the default can be set aside under either . . . section 473(b) or 473.5.

Stardust appeals from the April 8, 2008 order denying the second motion for relief from default.

II. DISCUSSION

Our legal discussion need only focus on the governing statute. Section 473(b) sets forth two avenues for relief from default: one discretionary, one mandatory. First, the trial 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. Second, the trial court shall order relief from default based on a sworn affidavit of the defaulting partys attorney attesting to his or her mistake, inadvertence, surprise, or neglect, so long as such attorney fault caused the default.

Stardust makes two arguments, both of which focus on section 473(b). Stardust has apparently abandoned the equitable arguments raised below, and makes no argument under section 473.5―which, in any case, does not apply here.

First, Stardust contends the trial court should have granted discretionary relief from default on the ground of excusable neglect. This is the main argument Stardust advanced below. But under section 473(b), a request for discretionary relief must be made within six months of the default. The default was entered April 17, 2007. Both motions for relief from default were filed well beyond that time limit. As a result, Stardusts second motion for discretionary relief from default was untimely.

In any case, we see no excusable neglect. The general denial clearly had not been filed. It had been marked Received, and even that mark had been crossed out. There was no excuse for anyone not to realize the document had not been filed.

Second, Stardust argues the trial court should have granted mandatory relief based on attorney fault. This argument was not made below and would have been untimely beyond the six-month time period. In any case, we doubt that Akbars declaration in support of the second motion qualifies as an affidavit of attorney fault resulting in default. The record indicates that Akbar was about to be substituted out of the case at the time―which she was a few months later―and she thought the matter would be resolved by the attorney for Millers estate. The estate attorney could have ensured that a responsive pleading was on file. This is hardly an indication that Akbar was at fault for the matter going to eventual default some seven months after the general denial was rejected and some five months after Akbars representation ended.

III. DISPOSITION

The order denying the second motion for relief from default is affirmed.

_________________________

Marchiano, P.J.

We concur:

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Swager, J.

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Flinn, J.

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[1] Subsequent statutory references will be to the Code of Civil Procedure. To reduce verbal and visual clutter, we will use a simplified form of citation, e.g., section 473(d).