Lead Opinion
Opinion
—Representing himself, appellant Donald T. Grappo filed a complaint purporting to allege 10 causes of action. Seven of the causes of action were set forth in one paragraph, the other three ranging from two paragraphs to five—a complaint, we note, that as framed could not have withstood a demurrer. Grappo had the complaint served on Kenneth McKean, a man named in the caption but not identified in the complaint— and who from all indications had no relationship with Grappo. Six months after such service—and without warning to anyone—Grappo filed a request for default against McKean and his firm (McKean & McMills, LP), seeking a default judgment for $9,982,308.83, with a claimed itemization of damages referring to numbers nowhere found in the complaint. The clerk entered the default on July 1, 2014, but the court refused to enter judgment, entering an order fisting seven specific reasons why.
On November 23, 2014, McKean died, a death of which Grappo was aware. Two weeks later, Grappo filed another request for default and court judgment, a request “not mailed” to anyone because McKean was “now deceased.” This request sought a judgment in the amount of $12,012,818.88, once again with numbers found nowhere in the complaint. This time, however, Grappo filled in the declaration portion in the request referring to “$60,000,” an amount in the prayer for the claimed value of personal property referred to in the eighth cause of action “belonging to some of the heirs of the Michael A. Grappo 2003 Trust.” Apparently based on that, the court entered judgment for Grappo and against McKean and McKean & McMills, LP, for $60,000 plus costs of $750.
Grappo appeals from that order, an appeal we reject as the trial court was right. And we publish the opinion, to remind trial courts that however burdened they be, they must vigilantly attend to their duty in connection with the default process, “ ‘to act as gatekeeper, ensuring that only the appropriate claims get through.’ ” (Fasuyi v. Pennatex, Inc. (2008)
THE PROCEEDINGS BELOW
On November 8, 2013, “[s]elf [Represented” Grappo filed a complaint. The complaint names five defendants, two entities and three individuals, not one of which or whom is described or identified. Indeed, Grappo does not even identify himself, or describe any claimed connection or relationship with any of the defendants, his complaint beginning as follows: “COMES NOW the Plaintiff, Donald T. Grappo and says that: on or about April 28, 2009 and continuing through the year 2012, Defendants, and each of them did willfully and with malice aforethought misappropriate funds belonging to the Michael A. Grappo 2003 Trust.”
We digress momentarily from a description of the complaint to note that Grappo cannot be a proper plaintiff as to claims held by a trust. The proper plaintiff is the trustee. (Code Civ. Proc., § 369, subd. (a);
The complaint states on the front page that it is for “fraud, breach of fiduciary duty, gross negligence, misappropriation of funds.” However, the complaint itself purports to allege many more causes of action, 10 to be
The prayer of the complaint sought this:
“2. All excessive attorney’s fees returned to the heirs of the Michael A. Grappo 2003 Trust;
“3. All excessive Trustees fees charged the Trust by Trustees returned to the heirs of the Michael A. Grappo 2003 Trust;
“4. Punitive damages for loss of revenue to the trust determined and said amounts be returned to the heirs of the Michael A. Grappo 2003 Trust;
“5. Punitive damages for failed [«'c] to renew Abstract of Judgment in the sum of $3,477,259.08 plus interest thereon;
“6. The sum of $60,000.00 which is the value of property removed from the Piedmont property site and disposed of without notification to the owner of said property.”
On December 30, 2013, McKean was served at his home in Piedmont.
On June 30, 2014, Grappo filed a request for entry of default against McKean and McKean & McMills, LP. Item 2 in the request, “Judgment to be entered,” read as follows:
*1002 
(Fn. & boldface omitted.)
Item 6, the declaration of mailing required under section 587, represented that the request was served on two law firms and on “Ken McKean, McKean & McMills[,] LP, 28 Lorita Ave, Piedmont, CA 94611.” Interestingly, one of the law firms, Cooper, White & Cooper, LLP, had on April 18, 2014, substituted in as counsel for Heather McMills, apparently the other principal of McKean & McMills, LP.
On July 1, the clerk entered the default. However, the court entered an order denying the request for default judgment, indicating that it was “NOT ENTERED” for the following reasons, listing seven.
On November 23, McKean died, a death that obviously became known to Grappo. Two weeks later, on December 8, Grappo filed another request for default
“g. Daily damages were demanded in complaint at the rate of $10% per annum per day beginning (date): 11/08/2000.” (Fn. & boldface omitted.)
In item 6, the declaration of mailing, Grappo checked the box that a copy of the request was “not mailed to the following defendants,” going on to state that “Defendant Ken McKean and Ken McKean as owner of McKean &
Grappo also filed a five-paragraph declaration in the request, which declaration read in its substantive entirety as follows:
“A complaint was filed in the above entitled matter on November 6, 2013. This Plaintiff affirms that the value of property which was removed without notice from the garage at the Piedmont Avenue property belonging to Declarant Donald T. Grappo is approximately $60,000.00. This Declarant cannot provide receipts for any of said property in that any and all information in connection with said property was also stored at the Piedmont Avenue property and was destroyed along with the property itself.
“I attach a copy of an email sent to me from attorney Brittain Habegger on March 21, 2011 which states in pertinent part ‘. . . It is my understanding that having given you and other family members several years to collect from the garage those things
“At no time was there ever a notification given to me, or to the best of my knowledge, information and belief to any of my family members that Trustee McKean intended to remove and destroy any of my property stored in the Piedmont property garage.”
No prove-up hearing was held. Rather, on December 22, the trial court filed a “Judgment Default” that Grappo recover from defendants Ken McKean and McKean & McMills, LP, $60,000 plus costs of $750.00.
The clerk served notice of entry of judgment on Grappo. No service was made, or apparently even attempted, on McKean & McMills, LP, or McKean or McMills as individuals.
On February 17, 2015, Grappo sent a letter to the trial court that read in its entirety as follows:
“This letter is addressing the $10 Million dollar figure cited in my request for judgment. I thank the court for issuing the $60,750.00 judgment which reimburses me for the items of personal property stored at the Piedmont property. However, Mr. McKean committed so many egregious errors while acting as trustee of my father’s trust, that it boggles the mind. I would appreciate you reviewing my request for judgment and considering issuing me a judgment connected with this missteps [ sic | while trustee of the Michael A. Grappo 2004 Trust at your earliest opportunity.
“Thank you for your kind consideration.”
Aubrey Cambra, trustee of the Kenneth A. McKean Trust, learned of the default judgment when Grappo filed a creditor’s claim in McKean’s estate. On November 4, 2015, Cambra filed a motion to vacate the default judgment and enter a different judgment. The motion references section 663; the memorandum of points and authorities refers to section 663 and also to section 473.5.
Grappo, now represented by counsel, filed opposition. Exclusive of exhibits, his substantive opposition was all of three pages, with two arguments: (1) that the motion was untimely and (2) even if timely, it “must be denied on the merits, because there was no prejudice to Defendant McKean or Cambra.”
Cambra filed a reply, and the motion came on for hearing before the same trial court that had entered the default judgment. The court heard extensive argument, lasting almost an hour. Among other things, Grappo’s counsel argued there was no prejudice, that there was “nothing that could have been done” as McKean had defaulted. The court interrupted: “Well, motion to vacate the default.” To which Grappo’s attorney responded, “Right.”
Following the hearing, the trial court entered its order granting the motion, vacating the judgment against McKean. The order was a comprehensive nine paragraphs, the first five of which detailed the procedural history leading to the setting before the court. The next three paragraphs set forth the bases for the court’s ruling, as follows:
“Trustee contends that Plaintiff should have substituted Kenneth McKean’s personal representative in this action and litigated against that personal representative in obtaining a judgment, as required by Code of Civil Procedure section 377.41.
“When a defendant in a pending action dies, the action may be prosecuted against the decedent’s personal representative. Pursuant to Code of Civil Procedure section 377.41, the court shall allow a pending action that does not abate to be continued against the decedent’s personal representative or, to the extent provided by statute, against the decedent’s successor in interest. As a general proposition, judgment cannot be entered for or against a decedent, nor against the personal representative of the decedent’s estate, until the
“Trustee has made a sufficient showing to vacate the judgment against Defendant Ken McKean. It is undisputed that Plaintiff has filed a creditor’s claim against the McKean Trust in Case No. RP15-765907 based on the Default Judgment in this action, and has filed another civil lawsuit against Trustee in Case No. RG15-779986, also based on the Default Judgment against Defendant Ken McKean. Trustee has established that she was not given notice of the existence of the default or the application for default judgment, and thus had no opportunity to seek relief from the default before Default Judgment was entered against Defendant Ken McKean. The prejudice to the Trust is clear, and Trustee has made a sufficient showing that the judgment against Defendant Ken McKean is void. (Code Civ. Proc., sec. 473(d).)”
Grappo filed a timely appeal from the order.
DISCUSSION
I. The Trial Court Order Was Correct
A. Governing Principles: Defaults and Default Judgments
The law concerning section 473 relief was set forth by the Supreme Court in Elston v. City of Turlock (1985)
A ruling setting aside a default or default judgment is reviewed under the abuse of discretion standard, and an appellate court will reverse only upon “ ‘ “a clear case of abuse” ’ ” and “ ‘ “a miscarriage of justice.” ’ ” (Blank v. Kirwan (1985)
B. Governing Principles: Appellate Review
The most fundamental principle of appellate review is that, “A judgment or order of a lower court is presumed to be correct on appeal, and ah intendments and presumptions are indulged in favor of its correctness.” (In re Marriage of Arceneaux (1990)
In light of those principles and presumptions, the burden is on Grappo to demonstrate error—and also “prejudice arising from” that error. (Gould v. Corinthian Colleges, Inc. (2011)
C. Introduction to the Analysis
Grappo’s opening brief is not a model of appellate advocacy. The brief sets out what occurred below in a fashion favorable to him, the loser, rather than in support of the trial court’s decision, which is bad enough. Worse, both of Grappo’s briefs continue the assertion his counsel made below, that Grappo did not have “knowledge of . . . McKean’s death on December 8, 2014, when the Request to Enter Default Judgment was hied.” As noted, this is flatly false, as shown by Grappo’s “under penalty of perjury” representation that McKean “is now deceased.” Such advocacy is not to be condoned.
The introduction to Grappo’s brief distills his position in the following language: “Appellant Grappo is seeking to have the Order reversed as a matter of law, based on undisputed facts, such that the December 22, 2015 judgment against defendant McKean stands and remains in effect. Alternatively, the lower court Order could be reversed as an abuse of discretion, to
D. Grappo Has Not Demonstrated Error
Grappo’s first argument is that the motion was late, beyond the time limits allowed by section 663.
To put the issue in context, Cambra’s motion to vacate stated that it was made ‘“pursuant to Code of Civil Procedure § 663 on the ground that the legal basis for the Judgment Default is incorrect and/or erroneous in that it is neither consistent with nor supported by the facts. Mr. McKean was deceased and the entity of which he was a general partner, McKean & McMills, LP, was not in existence at the time the Court entered the Judgment Default on December 22, 2014.”
The essence of this argument was that because McKean was dead, the judgment was void. In support of the argument, Cambra cited many cases holding that, as one Supreme Court case cited by Cambra tersely put it, ‘“A judgment rendered for or against a dead person is void . . .” (Estate of Parsell (1923)
Witkin describes this state of affairs this way: “Death During Action. If the defendant was alive when the action was begun and personal jurisdiction over him or her was obtained, the defendant was originally a party. Death occurring thereafter, before judgment, makes it improper to render judgment for or against the defendant without first taking the procedural step of substituting the executor or administrator. The failure to take this step is a departure from the mandatory requirements of the statute, and does result in a judgment for or against a person not a party. Hence, it seems clearly in excess of jurisdiction and subject to prevention or annulment by some form of direct attack. (See Boyd v. Lancaster (1939) 32 [Cal.App.2d] 574, 581 [
Grappo’s opposition did not even mention any of the cases cited in Cambra’s brief talking about “void.” In fact, the only case cited by Cambra referred to in Grappo’s opposition was Sacks v. FSR Brokerage, Inc., supra, 1 Cal.App.4th 950 (Sacks), a case, as quoted above, the trial court referred to in its order.
Sacks arose in the context where the plaintiff Sacks had summary judgment entered against him in favor of all the defendants, including Glen Gaither, who had died. Sacks appealed, contending that it was error to enter judgment in favor of a defendant who had died. Addressing the contenhon, the court observed as follows: “As a general proposition, it is true, as Sacks contends, that under these provisions judgment cannot be rendered for or against a decedent, nor can it be rendered for or against a personal representative of a decedent’s estate, until the representative has been made a party by substitution. [Citations.] A long line of cases has therefore allowed direct attack upon a judgment obtained without substitution of a personal representative after a party has died. [Citations.] In California, the rule can be traced back to the early Supreme Court decision in Juclson v. Love[, supra,]
Sacks is cited as “cf.” at the end of the Witkin passage quoted above, the author going on in the next paragraph to state that “This technical lapse [i.e., judgment against a dead person], however, does not render the judgment void and subject to collateral attack. The courts frequently describe it as a ‘mere irregularity,’ which renders the judgment ‘voidable only.’ (See Hogan v. Superior Court (1925) 74 [Cal.App.] 704, 709 [
But we need not make such a holding to affirm the trial court here, because we can affirm on the basis on which it ruled, applying Sacks, finding prejudice, and vacating the judgment under section 473, subdivision (d).
Grappo’s second argument, his apparent attempt to overcome the trial court’s ruling, is as follows: “The Sacks court’s test for vacating a judgment involving a decedent upon a showing of prejudice does not apply to section 473 subdivision (d) relief.” The argument is not clear, and no clarity is added by Grappo’s distillation of it.
One thing that Grappo does argue is that reliance on section 473, subdivision (d) was not proper because it was “cited in [Cambra’s] Reply brief, which does not meet explicit statutory requirements for a noticed motion.” As noted, Cambra’s motion papers cited section 473, though not subdivision (d), which was first cited in the reply brief. Regardless, Grappo’s argument would not avail him, not in light of the cases that recognize a court has discretion to accept arguments or evidence made for the first time in reply. (See, e.g., Alliant Ins. Services, Inc. v. Gaddy (2008)
Those cases would seem to apply a fortiori in the default context, with the strong presumption to provide a hearing on the merits. And most certainly in connection with section 473, which should be liberally construed, any doubts about its application to be resolved in favor of the party seeking relief from default. (Zamora v. Clayborn Contracting Group, Inc. (2002)
All this is particularly apt here, where from the very beginning—that is, page 4 of the reporter’s transcript—the lengthy argument on Cambra’s motion focused on section 473. And, as quoted above, the trial court applied Sacks and found that: “Trustee has made a sufficient showing to vacate the judgment against Defendant Ken McKean. . . . Trustee has established that she was not given notice of the existence of the default or the application for default judgment, and thus had no opportunity to seek relief from the default before Default Judgment was entered against Defendant Ken McKean. The prejudice to the Trust is clear, and Trustee has made a sufficient showing that the judgment against Defendant Ken McKean is void. (Code Civ. Proc., sec. 473(d).)”
And prejudice there was, as Grappo’s counsel conceded below, when the trial court interrupted her “no prejudice” argument with the terse observation, “Well, motion to vacate the default”—and counsel replied, “Right.” There was prejudice. That ends Grappo’s “abuse of discretion” argument.
The closing of Grappo’s reply brief states that “equities and public policy strongly support maintaining the validity of the underlying judgment.” Nothing is cited in claimed support, which is perhaps not surprising, as the law is 180 degrees contrary, illustrated, for example, by Au-Yang v. Barton (1999)
Indeed, the only case cited by Grappo for this argument—cited for the proposition that there should be ‘“finality of judgments”—makes this point in spades. And hardly helps Grappo. That case is Rappleyea, supra,
In Fasuyi, supra,
“The Role of the Court in Default Judgments
“It is, of course, the case that there is no opposing party in a default judgment situation. Thus, cases properly recognize that in such situation ‘it is the duty of the court to act as gatekeeper, ensuring that only the appropriate claims get through.’ (Heidary v. Yadollahi (2002)
“California Judges Benchbook: Civil Proceedings Before Trial (CJER 2d ed. 2008) (Benchbook) is a treatise that ‘focuses on the judge’s role.’ (Benchbook, supra, preface, p. v.) It provides ‘practical working tools to enable a judge to conduct proceedings fairly, correctly, and efficiently. [It is] written from the judge’s point of view, giving the judge concrete advice on what to look for and how to respond.’ {Ibid.)
“Chapter 16 of the Benchbook deals with defaults and default judgments, and in its second section of advice states that ‘[a] judge may enter a default judgment against a defendant only if the plaintiff has precisely followed certain procedures that ensure that the defendant received sufficient notice of the pending action to make an informed choice as to whether to defend or ignore the plaintiff’s claims. [Citations.] When the plaintiff fails to comply with these procedures, the defendant need not suffer the consequences of a default judgment. [Citation.]’ (Benchbook, supra, § 16.2, p. 371.) As the Court of Appeal put it in Lopez v. Fancelli (1990)
The threshold issue in Fasuyi dealt with the various forms and papers that had to be filed preparatory to a proper default and default judgment. And so
“A judge may not enter a default judgment against a defendant unless the plaintiff’s complaint states a cause of action against the defendant. Taliaferro v. Davis (1963) 216 [Cal.App.2d] 398 [
“Plaintiffs in a default judgment proceeding must also prove that they are entitled to the damages claimed. Barragan v. Banco BCH (1986) 188 [Cal.App.3d] 283, 302 [
Justice Bedsworth has well described this responsibility, most recently in Kim, supra, 201 Cal.App.4th at pages 272-273. Reversing the default judgment the trial court had entered, he repeated his “cautionary tale” for the trial courts: “And it is not the first time we have told this tale. As we previously explained in Heidary v. Yadollahi[, supra,]
Proper application of the gatekeeper function should have precluded any default judgment here. For several reasons.
First, as noted above, Grappo’s complaint does not set forth the identity or relationship of any of the people or entities named in the caption. Indeed, he does not even indicate his own identity, or his claimed relationship with any of the defendants.
Second, the complaint does not comply with the California Rules of Court. For example, California Rules of Court, rule 2.112 provides that each cause of action should be headed so as to identify briefly the nature of the claim asserted and if there is more than one, it should identify the defendant or defendants against whom the cause of action is being asserted. As the leading practical treatise advises, failure to comply with rule 2.112 presumably renders a complaint subject to a motion to strike (§ 436), or a special demurrer for uncertainty. (Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2016) ¶ 6:113, pp. 6-33 to 6-34.)
Third, to the extent that any wrong is attempted to be asserted, they appear to be wrongs against the Michael A. Grappo 2003 Trust. Grappo is not the proper plaintiff. (§ 369; Portico Management Group, LLC v. Harrison (2011)
Fourth, and most fundamentally, Grappo’s complaint does not state a claim for any loss of property. That is, reading Grappo’s complaint as liberally as one can in his favor, the only possible cause of action that deals with any ‘“property” allegedly lost is the eighth. That cause of action is styled ‘“Gross Negligence and Defalcation.” And the only reference to property is in the second of its two paragraphs, that quoted above: ‘“9. Defendant McKean further removed or authorized the removal of items of personal property belonging to some of the heirs of the Michael A. Grappo 2003 Trust without prior notification to said property owners and without ever notifying said property owners of the disposal of these items of personal property which were being stored at the Piedmont property site.” It does not state a cause of action.
We know of no cause of action for ‘“defalcation.” And “ ‘California does not recognize a distinct cause of action for ‘“gross negligence” independent of a statutory basis.’ ” (Eriksson v. Nunnink (2011)
But even if Grappo’s claim were for ordinary negligence, it would fail, as such a claim requires a legal duty to use due care and breach of that duty. (Ladd v. County of San Mateo (1996)
If the complaint does not state a cause of action or the allegations do not support a claim for relief, a default judgment is erroneous and “cannot stand.” (Kim, supra,
Were all that not enough, counsel for Grappo admitted at oral argument that Grappo’s complaint did not state a claim.
Finally, the default judgment is void for the additional reason that the $60,000 amount awarded to Grappo is not supported by the complaint. As quoted, the only property referred to is in the eighth cause of action: “items of personal property belonging to some of the heirs” of the trust. (Italics added.) The exhibit Grappo attached to the request, an e-mail from Attorney Habegger, refers to his understanding that his office had given Grappo “and other family members” a long opportunity to remove the items. According to the proofs of service, there are apparently six other Grappos spread throughout California and Oregon—apparently the other “heirs” or “family members” with some interest in the property.
The order is affirmed. Cambra shall recover her costs on appeal.
Notes
All undesignated statutory references are to the Code of Civil Procedure.
As the comí noted below, and Grappo acknowledged, this second request for default was improper.
Numerous cases have used such language since. (See, e.g., Johnson v. Simonelli (1991)
As will be shown, the judgment here is void because the complaint does not support the default judgment entered for Grappo—indeed, any default judgment at all.
We end this part of the opinion with brief comments about the dissent.
As Grappo’s counsel conceded at oral argument, Grappo’s complaint does not state a claim. Despite that, and despite that Grappo may be the poster child for an avaricious overreacher— improperly attempting to get a $12 million judgment against a known dead man—the dissent would resurrect the default judgment in Grappo’s favor. Why is hard to fathom. The stated reason for doing so is “the public policy favoring the finality of judgments,” citing Rappleyea, supra,
The dissent approaches the setting before us contrary to our role here (presuming the order is correct); contrary to the role of any court dealing with defaults (discretion liberally applied to grant relief); and contrary to public policy (cases are to be tried on the merits). It also disregards how we are to read the record—in favor of the trial court and in support of the order.
In its thorough analysis, the trial court found that, “Trustee has established that she was not given notice of the existence of the default or the application for default judgment, and thus had no opportunity to seek relief from the default before Default Judgment was entered against Defendant Ken McKean. The prejudice to the Trust is clear . . . .” The dissent states that this finding is not supported by substantial evidence, a position that includes that the dissent disagrees “that the Trustee’s lack of opportunity to seek relief from the default before entry of the default judgment alone was enough.” (Dis. opn., post, at p. 1030.) Indeed, and as noted, Grappo’s counsel conceded as much below when, in the course of her argument that there was no prejudice, that there was “nothing that could have been done” as McKean had defaulted, the court interrupted: “Well, motion to vacate the default.” Grappo’s attorney responded, “Right.” The dissent describes this as “little more than throat-clearing.” (Dis. opn., post, at p. 1030, fn. 14.)
The trial court found that the trustee did not have notice of the default. Notwithstanding this, and for some reason approaching the issue with a jaundiced eye, the dissent says “[f]or all we
Dissenting Opinion
Dissenting—There comes a time when the policy favoring relief from defaults gives way to the public policy favoring the finality of judgments. (Rappleyea v. Campbell (1994)
Here, the majority affirms a trial court order vacating a final judgment under Code of Civil Procedure section 473, subdivision (d)
In affirming this judgment, the majority goes to great lengths to reach the result that it does. It presents a selective and one-sided recitation of the
The majority also takes a detour from the course charted by the parties to discuss arguments about defects it finds in Donald T. Grappo’s underlying complaint and a challenge to his standing. The parties did not raise these arguments, and for good reason. The majority’s standing argument is simply wrong, and its argument that the complaint fails to state a cause of action provides no basis for a collateral attack on the judgment. In chiding the trial court for failing to fulfill its role as “gatekeeper,” the majority oversteps its own role, which is one of decision maker, not advocate. Doing so leads to errors that could have been avoided.
In addressing the arguments the parties did make, the majority ignores decades of settled law—including decisions by our highest court and this one—holding that a judgment entered for or against a dead person is not void but merely voidable. It suggests that this body of law does not apply to judgments obtained by default but provides no authority or rationale for this proposition.
Finally, the majority assumes prejudice based solely on the fact that McKean died before the default judgment was entered, despite the lack of any actual evidence that a different outcome would even potentially have resulted if the Trustee had been substituted shortly after his death. I cannot agree, especially given the Trustee’s failure to take any steps to protect her rights until months after she became aware of the default judgment.
In my view, the failure to substitute the Trustee for the deceased McKean rendered the default judgment here voidable, not void, and it could not be set aside on the ground defendant had died before its entry by a motion filed more than six months (indeed, 10 months) after it was entered. For that reason alone, the order vacating this final judgment should be reversed. In addition, though, even if a final judgment could be attacked at any time on the ground the Trustee here asserted, as the majority implicitly holds, the motion still should have been denied because the Trustee did not show any
BACKGROUND
Because the majority’s discussion omits important facts, and focuses on others that in my view are irrelevant, I briefly restate the factual background as I see it.
In November 2013, Grappo commenced this action in propria persona alleging misappropriation of funds in the administration of the Michael A. Grappo 2003 Trust. He prayed for $60,000 in specific damages, various allegedly excessive fees in an unspecified amount and punitive damages. One defendant was Kenneth A. McKean, whom the majority asserts is “not identified in the complaint—and who from all indications had no relationship with Grappo.” (Maj. opn., ante, at p. 999.) But, while the complaint is not an exemplar, it plainly identifies McKean as a trustee, alleging: “Defendant McKean’s duty as a trustee was to either make money for said trust and certainly not to cost it’s [sic] heirs part of their inheritance by causing said trust to lose money.” (Italics added.) The majority also faults the complaint because Grappo “does not even identify himself, or describe any claimed connection or relationship with any of the defendants.” (Maj. opn., ante, at p. 1000; see also id., at p. 1014.) Even apart from the obvious implication from the family name he shares with the trustor that Grappo is one of the “heirs” injured by defendants’ alleged malfeasance, Grappo identifies himself as an “heir” to the trust both in the body of the complaint and its signature block. The Trustee could find no fault with this complaint, criticizing it neither below nor on appeal. In her respondent’s brief she states as obvious that which the majority finds inscrutable: Grappo “filed the trial court action in his capacity as a beneficiary of the Grappo Trust.”
McKean was personally served with process in December 2013 but entered no appearance, and it was not until six months later, on June 30, 2014, that Grappo requested entry of default against him. The clerk entered default the following day, which the majority inexplicably asserts was done “without warning to anyone.” (Maj. opn., ante, at p. 999.) As it acknowledges elsewhere however (maj. opn., ante, at p. 1002), Grappo had previously served McKean with the request for entry of default by mail (on June 19, 2014). He also served two law firms.
On November 23, 2014, a year after the complaint was filed and roughly four and a half months after McKean’s default had been taken, McKean died.
A short time later, on December 8, 2014, Grappo filed a request for entry of a default judgment against McKean using the required form. In the “Declaration of mailing” portion of the form, Grappo checked a box indicating the request was not mailed to McKean and inserted an explanatory note stating, “Defendant Ken McKean and Ken McKean as owner of McKean & McMills, LP is now deceased and could not be served.”
As the majority notes, no prove-up hearing was held. None was required. (See Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2016) ¶¶ 5:202, 5:208, pp. 5-53 to 5-54; Code Civ. Proc., § 585, subd. (d).)
On December 22, 2014, the court signed and entered a judgment of default against McKean in the amount of $60,750, consisting of $60,000 in principal damages and $750 in costs.
On May 6, 2015, about six weeks before the judgment would become final, Grappo filed a written creditor’s claim concerning the judgment in trust administration proceedings for McKean’s estate. The Trustee was represented by counsel in that proceeding, and Grappo’s claim specified the date the judgment had been entered, some four and a half months earlier. Upon rejection of the claim, Grappo sued the Trustee, seeking payment of the judgment. Below, the Trustee argued she learned of the default judgment “no earlier” than the date Grappo filed the creditor’s claim.
One and a half months after the Trustee learned about the judgment, it became final, on June 22, 2015, when the 180-day deadline to appeal it expired. (See Cal. Rules of Court, rule 8.104(a)(1)(C); § 12a, subd. (a).)
Grappo, at this point represented by counsel, opposed the motion by responding to the only two statutory bases invoked, arguing the motion was untimely under section 663 and section 473.5 did not apply because McKean received actual notice of the action well before he died and in time to defend. Grappo also argued there was no prejudice to the Trustee from not having been substituted in as a party, since McKean was alive when his default was taken and there was nothing the Trustee could have done later to avert entry of the default judgment.
For the first time in her reply, the Trustee invoked section 473, subdivision (d), arguing there is no deadline to move to set aside a void judgment under section 473, subdivision (d). Section 473, subdivision (d) authorizes a court, on noticed motion, to “set aside any void judgment.” The reply also alluded to the court’s inherent equitable power to vacate a default judgment and asserted that entry of the default judgment had resulted from extrinsic fraud and mistake. However, other than copies of pleadings from this case and related proceedings, the Trustee submitted no evidence in support of her motion. Thus there was no showing that the default judgment was the product
Following a contested hearing, the trial court granted the motion to vacate the judgment. The court did not address the motion’s timeliness, but recognized “as a general proposition” that a judgment rendered for or against a decedent “is not void, and . . . will be set aside only upon a showing of prejudice.” (Italics added.) It concluded the Trustee “was not given notice of the existence of the default or the application for default judgment, and thus had no opportunity to seek relief from the default before Default Judgment was entered” and “[t]he prejudice to the Trust is clear.” The court then concluded that the Trustee “has made a sufficient showing that the judgment . . . is void.” (Italics added.) This timely appeal followed.
DISCUSSION
I.
What This Appeal Is Not About
In challenging the trial court’s ruling, Grappo argues principally the Trustee waited too long to move to set aside the default judgment and in any event made an insufficient showing to justify that relief. I agree. Before setting out my reasoning, I address two subjects I believe lead the majority decidedly in the wrong direction.
A default judgment cannot be attacked collaterally on the ground the complaint fails to state a cause of action, and is valid as long as the complaint is “sufficient to apprise [the defendant] of the nature of the [plaintiff’s] demand.” (Molen v. Friedman (1998)
As for Grappo’s standing, I read the law quite differently than the majority. While “ ‘[a]s a general rule, the trustee is the real party in interest with standing to sue and defend on the trust’s behalf[,]’ . . . this general rule does not extend to an action alleging the trustee itself breached a duty. ‘[A] trust beneficiary can bring a proceeding against a trustee for breach of trust.’ ” (Estate of Giraldin (2012)
In short, I cannot sustain the trial court’s ruling on either of the grounds that the majority has independently raised.
II.
The Trustee’s Motion Was Timely Under Section 473, Subdivision (d) Only if the Default Judgment Was Void.
The majority holds the trial court properly vacated this judgment under section 473, subdivision (d). (Maj. opn., ante, at p. 1009.) That provision states, “The court . . . may, on motion of either party after notice to the other party, set aside any void judgment or order.” (§ 473, subd. (d).) This provision “does not place any time limit on bringing such a motion.” (Tearlach Resources Limited v. Western States Internat., Inc. (2013)
In short, the trial court’s power to set aside this final judgment under section 473, subdivision (d) turns on whether the judgment was void, or merely voidable, due to McKean’s death, a question we review de novo. (See Rodriguez v. Clio (2015)
The Default Judgment Was Not Absolutely Void.
Lee sets out a helpful framework for understanding whether a judgment is void or merely voidable. Lee explained, “The distinction between void and voidable orders is frequently framed in terms of the court’s jurisdiction. ‘Essentially, jurisdictional errors are of two types. “Lack of jurisdiction in its most fundamental or strict sense means an entire absence of power to hear or determine the case, an absence of authority over the subject matter or the parties.” [Citation.] When a court lacks jurisdiction in a fundamental sense, an ensuing judgment is void, and “thus vulnerable to direct or collateral attack at any time.” [Citation.]’ [Citation.] For example, if a defendant is not validly served with a summons and complaint, the court lacks personal jurisdiction and a default judgment in such action is subject to being set aside as void.” (Lee, supra, 168 Cal.App.4th at pp. 563-564.) By contrast, “ ‘[w]hen a court has fundamental jurisdiction, but acts in excess of its jurisdiction, its act or judgment is merely voidable. [Citations.] That is, its act or judgment is valid until it is set aside ....’” (Torjesen, supra,
This court recognized in Woolley v. Seijo (1964)
The principle that a judgment is not void but merely voidable where a party has died derives from California Supreme Court authority dating back more than a century. (See Todhunter v. Klemmer (1901)
The results in many cases reflect this rule. For example, Tyrrell held a judgment entered against a defendant in a dispute over real property ownership was not void even though the defendant died before trial, and was admissible in a later action brought by the decedent’s grantees concerning the same subject matter. (See Tyrrell, supra, 67 Cal. at pp. 4-5.) Woolley held a federal judgment entered jointly and severally against a defendant who died before its rendition was enforceable against his estate in an independent state action; it could not be collaterally attacked in the latter action. (See Woolley, supra, 224 Cal.App.2d at pp. 620-621.) Todhunter upheld a judgment enforcing an appeal bond, holding the death of one of the plaintiffs before entry of judgment in the underlying suit did not render either the judgment or the bond void and unenforceable, but merely voidable. (See Todhunter, supra, 134 Cal. at pp. 62-63.) And Phelan held the death of a party pending an appeal did not render the Supreme Court’s subsequent decision and judgment in the case void even though no personal representative was ever substituted
The majority’s suggestion that a different rule applies to default judgments is not supported by any authority of which I am aware, and at least one Court of Appeal decision has permitted a default judgment to be enforced though entered in the name of a dead person. Machado affirmed a judgment of nonsuit in an equitable action to enjoin enforcement of a default judgment entered in the name of a plaintiff who had died after filing the action but before summons was served, and whose representative was not substituted in until after the judgment was entered. (See Machado, supra, 75 Cal.App.2d at pp. 760-761, 763.) The court held the judgment was not void, and its enforcement could only be prohibited on an equitable basis and no such basis had been shown. (Id. at pp. 762-763.)
Against this weight of authority, the majority cites a number of decisions describing judgments entered in the name of a dead party as “void.” (See Johnson v. Simonelli (1991)
In sum, this judgment was not void but merely voidable, and so the Trustee should have moved to set it aside within six months of its entry, before it became final and immune to collateral attack. Indeed, the Trustee knew about the judgment before the six months lapsed yet sat on her rights. The Trustee’s belated motion should have been denied. (See Torjesen, supra,
IV.
The Trial Court Erred in Vacating the Judgment Because There Is No Substantial Evidence the Trustee Was Prejudiced.
The trial court’s ruling in this case can and should be reversed solely on the ground that the Trustee’s motion was untimely, and I could stop there. But I also disagree with the majority that the judgment can be affirmed ‘“on the basis on which [the trial court] ruled, applying Sacks [v. FSR Brokerage, Inc. (1992)
The majority posits that ‘“perhaps using the Sacks analysis in the default situation . . . death is per se prejudice” (maj. opn., ante, at p. 1009), by which
Setting aside the timing issues already discussed, I do agree that no matter the context or timing, a trial court’s error in rendering judgment for or against a decedent may be redressed only if there was some kind of prejudice “because of lack of notice, lack of proper representation, or some other disadvantage.” (Sacks, supra, 1 Cal.App.4th at p. 957; see id., at pp. 958-959, and authorities cited.) But I cannot agree with the majority there was any showing of prejudice here. Specifically, I do not agree that the Trustee’s lack of opportunity to seek relief from the default before entry of the default judgment alone was enough.
As already mentioned, there is no evidence showing when the Trustee actually learned about the default. For all we know from the record, as opposed to the Trustee’s assertion in her briefs, the Trustee could have learned of the action from McKean before he died or from his partner and codefendant, Heather McMills, after he died but before the default judgment was entered. I say this not with a “jaundiced eye” as my colleagues posit (maj. opn., ante, at p. 1011, fn. 5), but because of the lack of any evidence bearing on when the Trustee first learned of the default proceedings, let alone the lawsuit itself or its status. (Cf. Pulte Homes Corp. v. Williams Mechanical, Inc. (2016)
But even accepting the unsupported assertion in the Trustee’s brief below that she did not learn of the default before she was served with the creditor’s claim, which was after the judgment was entered, she has still failed to show prejudice. That is because she made not the slightest showing that she had any substantive basis to challenge the entry of default. Nor did she provide any evidence that if relief from default had been granted there was any viable defense she could have raised on the merits. So no showing was made that any rights were lost. This might have been a different case had the Trustee introduced evidence that some potential basis for challenging the default was lost when the case proceeded to judgment in her absence. But given her tactical choice not to do so, in my view the mere fact that a judgment was entered on the default is insufficient to establish prejudice.
Here, therefore, the trial court erred in vacating the judgment because there is no substantial evidence the Trustee was prejudiced. (See Pulte Homes, supra,
Indeed, this record demonstrates the Trustee was not prejudiced. She admits she knew about this judgment four and a half months after it was entered, which was well in time to move to set it aside on the basis of mistake, inadvertence, surprise or excusable neglect (§ 473, subd. (b)). Yet she made no effort to do so. She did nothing at all to seek relief for a full six months after she learned of the judgment. So the timing of Grappo’s request for entry of a default judgment could not be prejudicial. (Cf. Rodriguez v. Henard (2009)
Y.
Equitable Relief Was Unavailable.
Here, the majority affirms the trial court’s ruling solely on the ground the trial court properly applied section 473, subdivision (d), and does not consider whether the trial court’s ruling could be sustained on the alternative ground that it was within the court’s discretion to grant the Trustee equitable relief from the judgment due to extrinsic fraud or mistake. Because I disagree that relief was available under section 473, I briefly address the Trustee’s argument that equitable relief was available too, a question reviewed for abuse of discretion. (See Rappleyea, supra, 8 Cal.4th at pp. 980-981 [considering whether trial court’s ruling denying relief from default could be sustained as proper exercise of its equitable powers where court misapplied § 473]; see also Pulte Holmes, supra, 2 Cal.App.5th at pp. 272, 275-278.)
Here, the Trustee argues in passing that “[t]he default judgment resulted from extrinsic fraud and mistake,” because Grappo ‘“did not inform the trial court of Mr. McKean’s . . . death before applying for the default judgment,” which led the court to “mistakenly enter[] the default judgment on December 22, 2014.” I would reject this argument, first, because Grappo did inform the court of McKean’s death before entry of judgment, although the parties overlooked this below and in their appellate briefs. Equitable relief also could not have been granted, in any event, because the Trustee made no showing she had a meritorious defense, a showing required to set aside the judgment on equitable grounds. (See Lee, supra,
CONCLUSION
To be clear, it is not my position that it is proper to enter a default judgment (or any judgment, for that matter) in the name of a party who has died. Such a judgment is erroneous. But like many other types of trial court error, an error of this sort—rendering the judgment merely voidable not void—may be challenged only by certain means, and here those means were not utilized: through a direct, timely attack within six months, or through a collateral attack on an equitable basis not proved here by this record. I cannot agree with the rule adopted by the majority that renders such a judgment open to attack anytime and achieves finality in name only. Nor do I concur that it is open to attack at all in the absence of evidence indicating the failure to substitute had any effect on the outcome of the case. Nor, finally, do I reach either conclusion in derogation of our duty as a reviewing court to presume the correctness of the trial court’s ruling (maj. opn., ante, at p. 1011, fn. 5); they are conclusions I reach based upon careful scrutiny of both this record and the law. In my view, the trial court erred when it vacated this judgment. Regardless of the majority’s concerns for the potential substantive merits of this lawsuit, and regardless of the somewhat clumsy manner by which Grappo, a layperson, set about to request entry of this default judgment, this judgment did become final, and as such it constituted a vested property right that the majority, in affirming, far too lightly casts aside. (See Rappleyea, supra,
I would therefore reverse the grant of relief from the default judgment and reinstate the judgment.
Appellant’s petition for review by the Supreme Court was denied September 13, 2017, S242927.
All further statutory references are to the Code of Civil Procedure unless otherwise indicated.
An application for relief under section 473, subdivision (b) must be accompanied by “a copy of the answer or other pleading proposed to be filed” and be made “within a reasonable time, in no case exceeding six months, after the judgment . . . was taken.”
The Trustee also tells us in her brief that McKean was the general partner of the entity that served as Trustee and, indeed, Grappo’s “primary contact.”
As the majority notes (maj. opn., ante, at pp. 1001, 1003), Grappo took the default and procured entry of a default judgment in the same amount against McKean’s partnership, McKean & McMills, LP, too, but the trial court declined to set that judgment aside and it is not at issue in this appeal.
The Trustee’s assertion, made in the papers and orally at the healing, was based only on the creditor’s claim. The Trustee filed no declaration, and there is no evidence that she did not learn of the default proceedings earlier.
Section 663 authorizes posttrial relief from a judgment “based upon a decision by the court, or the special verdict of a jury,” and entry of “another and different judgment” and “may only be brought when ‘the trial judge draws an incorrect legal conclusion or renders an erroneous judgment upon the facts found by it to exist’ ” (Payne v. Rader (2008)
The majority criticizes the brevity of this written opposition (“all of three pages” (maj. opn., ante, at p. 1004)), but the Trustee’s substantive argument was equally brief and she invoked two inapplicable statutes.
I agree with the majority that the other issue Grappo raises furnishes no ground for reversal (namely, that the Trustee raised § 473, subd. (d) improperly below only in her reply papers). But I would not be so quick to condemn the quality of Grappo’s appellate briefing. (Maj. opn., ante, at p. 1006.) While Grappo’s opening brief is no “model of appellate advocacy” (ibid,), his presentation of the facts is not nearly as one sided as the majority describes it, and his reply brief states the arguments I believe should carry the day. And while Grappo’s briefing does misstate that he did not know of McKean’s death when he requested entry of a default judgment (ibid,), the most plausible explanation is oversight on his counsel’s part, not intentional misrepresentation. The evidence that McKean died before judgment consists of one sentence in tiny print on Grappo’s form request for default judgment, which he filed in propria persona two years ago. Apparently, nobody noticed this, including the Trustee’s counsel who makes similar misstatements in her own brief by accusing Grappo of “applfying] for and obtainfing] a default judgment . . . without notifying the trial court that Mr. McKean had died.” At oral argument, the Trustee’s counsel even stated it was “just as likely if not more likely” that the trial court did not notice this either when entering the default judgment. The fact that Grappo was aware of McKean’s death and notified the trial court of it in his request for entry of default judgment surfaced during this court’s review of the record.
In any event, to the extent the majority has concerns about the quality of the parties’ briefing, I am puzzled as to why the Trustee emerges free from criticism. It was the Trustee, for example, who moved in the trial court under section 663, yet on appeal disavows that
The majority quotes Elston at some length but omits the opening sentence of Elston’s analysis, which illuminates it involved relief under section 473, subdivision (b): “Section 473 permits the trial court to ‘relieve a party . . . from a judgment, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise or excusable neglect.’ ” (Elston, supra. 38 Cal.3d at pp. 232-233; see also id, at p. 233, fn. 4 [quoting the text of § 473, subd. (b)].)
1 have no disagreement that trial courts must carefully and properly discharge their' gatekeeping role when asked to enter a judgment by default. But here, the trial court did so, rejecting Grappo’s first request for entry of a default judgment, directing him to try again and limiting the judgment to an amount specifically alleged in the complaint.
Other cases cited by the majority involve direct appeals from a default judgment and are not on point. (See Kim v. Westmoore Partners. Inc. (2011)
To be clear, extrinsic fraud or mistake constitutes a separate basis for collaterally attacking a final judgment (whether or not the judgment is argued to be void), pursuant to a court’s equitable powers. (See generally 8 Witkin, Cal. Procedure (5th ed. 2008) Attack on Judgment in Trial Court, § 215, p. 823.) But Rappleyea instructs that equitable relief from a final judgment “may be given only in exceptional circumstances.” (Rappleyea. supra.
As the majority notes (maj. opn., ante, at p. 1008), language in some of these cases describing judgments as “void” derives from Judson v. Love (1868)
1 also do not agree Grappo’s counsel conceded this issue at the hearing. (Maj. opn., ante. at p. 1010.) The majority is too quick to pounce on a passing comment (“Right”) that, in context, strikes me as little more than throat-clearing. Indeed, she later returned to her no prejudice argument, telling the trial court again that, “once the default was entered, then it had absolutely no effect whether he was alive or not when his default judgment was entered. And so that’s when—by no prejudice—,” to which the court responded, “Okay.”