Sass v. Cohen
32 Cal. App. 5th 1032
Cal. Ct. App. 5th2019Background
- Sass sued Cohen and Tag (his company) after their romantic/financial partnership ended, alleging breach of a Marvin agreement, fraud, unpaid wages, quantum meruit, an accounting (valuation of two houses, Tag, Cohen’s income, and stock), and a fraudulent transfer claim.
- The Second Amended Complaint (SAC) generally pleaded damages "in a sum to be proven at trial," but elsewhere asserted specific item amounts (e.g., $300k+ for Hollywood house share, $3,000,000 for 50% of fair market value of both houses, $700,000 for Tag, $120,000 wages, $25,000 stock) and alternatively sought a constructive trust over the Oakley house.
- Cohen and Tag did not answer; clerk entered default. At prove-up, plaintiff’s expert valued the aggregate recovery at $6,351,000; the trial court awarded $2,806,532 in compensatory damages, prejudgment interest, punitive damages, costs, and a constructive trust over the Oakley house.
- Cohen moved to vacate, arguing the default judgment exceeded the amount demanded in the SAC; trial court denied the motion relying on Cassel (accounting exception). Cohen appealed.
- The appellate court considered two unsettled questions: whether an accounting/valuation claim excuses a plaintiff from pleading a damages amount (Cassel issue) and whether comparison of awarded vs. demanded damages should be aggregate or item-by-item.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether accounting/valuation claims permit default judgments exceeding the pleaded amount (Cassel exception) | Sass relied on Cassel: accounting claims involve unascertained amounts and defendants possess valuation info, so specific pleading of amount is unnecessary. | Cohen argued Cassel is wrong; §580 bars awards beyond amounts demanded regardless of accounting/valuation nature. | Court rejected Cassel; accounting/valuation claims are not exempt from §580’s pleading/notice limits. |
| Whether to compare awarded vs. demanded compensatory damages on an aggregate or item-by-item basis | Sass implicitly argued trial court’s itemized prove-up was permissible. | Cohen urged item-by-item comparison would show the award exceeded pleaded amounts. | Court required aggregate comparison: total compensatory awarded ≤ total compensatory demanded. |
| Whether the default judgment exceeded the SAC’s demanded relief and remedy | Sass sought either (a) $3,837,500 total or (b) $987,500 plus constructive trust; she argued the judgment was within acceptable relief. | Cohen argued the $2,806,532 award exceeded the pleaded compensatory cap and was therefore void in excess. | Applying the aggregate rule, the court held the award exceeded the $987,500 compensatory demand by $1,819,032; that excess is void. The court vacated the judgment and remanded to (a) reduce judgment by that excess or (b) allow amendment and re-service. |
Key Cases Cited
- Becker v. S.P.V. Construction Co., 27 Cal.3d 489 (statute caps default judgment to relief demanded)
- Lippel v. Superior Court, 51 Cal.3d 1160 (due process/formal notice requires pleading amounts; default ceiling)
- Greenup v. Rodman, 42 Cal.3d 822 (strict construction of §580; maximum judgment from complaint)
- Cassel v. Sullivan, Roche & Johnson, 76 Cal.App.4th 1157 (accounting exception; rejected here)
- Finney v. Gomez, 111 Cal.App.4th 527 (valuation/accounting claims must still plead amounts)
- Ely v. Gray, 224 Cal.App.3d 1257 (accounting claims involve unascertained sums but do not excuse pleading limits)
- Airs Aromatics, LLC v. CBL Data Recovery Technologies, Inc., 23 Cal.App.5th 1013 (procedural discussion of default-judgment notice and damages comparison)