39 Cal.App.5th 399
Cal. Ct. App.2019Background
- Plaintiffs McClain and Harrell sued Karen Kissler (individually and dba Alternatives) for breach of an agreement to grow/supply cannabis; summons and complaint were served by substituted service in Jan 2016.
- Kissler (an attorney) actively participated in related litigation (including a motion to expunge lis pendens) but did not timely answer or move to quash in this action; she later claimed she was not properly served.
- At a June 16, 2016 case management conference (CMC) Judge Nadler ordered plaintiffs to seek entry of default by July 22, 2016 if an answer was not filed and told defendants a motion to quash must be filed to challenge service; a minute order memorialized that ruling.
- Plaintiffs requested entry of default on June 29, 2016; the clerk entered default; plaintiffs later obtained a default judgment for damages and interest.
- Defendants filed multiple motions seeking to set aside the default under Code Civ. Proc. § 473(b), arguing (1) Kissler reasonably misunderstood the CMC/minute order and (2) Alternatives was entitled to mandatory relief because Kissler filed an attorney affidavit of fault. Trial court denied relief; defendants appealed.
- The Court of Appeal affirmed: it found defendants’ claimed mistake was not credible or excusable and held that Alternatives could not obtain mandatory relief because Kissler and Alternatives were effectively the same actor (so the mandatory attorney-affidavit protection did not apply).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether trial court abused discretion in denying discretionary relief under CCP § 473(b) for excusable mistake (misinterpreting the June 16 CMC/minute order) | McClain/Harrell: default was properly taken within deadline set by CMC; defendants bore the risk | Kissler: she reasonably interpreted the CMC/minute order to allow her until July 22 to file a motion to quash or answer; any mistake was excusable | Affirmed — court did not abuse discretion; record supports finding the failure to respond was knowing/deliberate and any claimed misunderstanding was not reasonable or credible |
| Whether Alternatives is entitled to mandatory relief under § 473(b) based on an attorney’s affidavit of fault | Plaintiffs: mandatory relief applies only where attorney and client are distinct; if attorney is the client or fault is joint, mandatory relief is unavailable | Alternatives: Kissler’s sworn affidavit of fault triggers mandatory vacatur of the default against the client | Affirmed — no mandatory relief because the trial court found Kissler and Alternatives to be one and the same; statute presumes distinct attorney and client and protects an innocent client from attorney error |
| Whether appellate record omissions require affirmance | Plaintiffs: omissions compel presumption the trial court’s ruling is supported by the missing materials | Defendants: submitted sufficient record to review error | Held — appellate record was deficient and that militates against reversal, and in any event the existing record supports the trial court’s factual findings |
| Whether default judgment should be set aside because parallel proceedings produced contrary rulings (e.g., summary adjudication in related suit finding Kissler not a party to the contract) | Defendants: conflicting rulings in related case show manifest injustice if default stands | Plaintiffs: default was procedurally proper here; conflicting outcomes reflect defendants’ litigation choices | Held — not a basis to set aside default; section 473 relief is discretionary and does not require relief simply because inconsistent outcomes exist in separate proceedings |
Key Cases Cited
- Zamora v. Clayborn Contracting Group, 28 Cal.4th 249 (Cal. 2002) (attorney negligence is not excusable where it falls below professional standard)
- Rappleyea v. Campbell, 8 Cal.4th 975 (Cal. 1994) (policy favors deciding cases on merits; denials of § 473 relief are closely scrutinized but still reviewable for abuse of discretion)
- Elston v. City of Turlock, 38 Cal.3d 227 (Cal. 1985) (very slight evidence may suffice to set aside default; doubts resolved for party seeking relief)
- Fasuyi v. Permatex, Inc., 167 Cal.App.4th 681 (Cal. Ct. App. 2008) (discusses liberal application of § 473 where defendant acts promptly and prejudice is absent)
- Hearn v. Howard, 177 Cal.App.4th 1193 (Cal. Ct. App. 2009) (appellant bears burden to supply adequate record on appeal of § 473 ruling)
- Gutierrez v. G&M Oil Co., Inc., 184 Cal.App.4th 551 (Cal. Ct. App. 2010) (addressing application of mandatory relief to in-house counsel—distinguished on facts)
- Benedict v. Danner Press, 87 Cal.App.4th 923 (Cal. Ct. App. 2001) (mandatory § 473 relief may apply where attorney’s conduct is a cause in fact even if client also contributed to default)
- Esther B. v. City of Los Angeles, 158 Cal.App.4th 1093 (Cal. Ct. App. 2008) (mandatory relief provision applies to an attorney representing a client, not to a person who is solely representing themself as both attorney and client)
- Iott v. Franklin, 206 Cal.App.3d 521 (Cal. Ct. App. 1988) (mistake of law excusability is a factual inquiry; conduct below professional standard is not excusable)