Opinion
It is hоrnbook law that a defaulting defendant cannot participate in a prove-up hearing. (See 6 Witkin, Cal. Procedure (5th ed. 2008) Proceedings Without Trial, § 175, p. 617; 46 Am.Jur.2d (2006) Judgments, § 304, pp. 629-630; 40A Cal.Jur.3d (2006) Judgments, § 40, pp. 75-76.) In California, however, there is a statutory exception to this rule in quiet title actions (Code Civ. Proc., § 764.010; all undesignated section references are to that code). Here, the trial court did not allow the defaulting defendants in a quiet title action to put on evidence at a рrejudgment evidentiary hearing.
We conclude the default judgment must be reversed so defendants may participate in a prejudgment evidentiary hearing to determine the merits of the quiet title action.
I
BACKGROUND
According to the operative complaint, plaintiff Jerry Nickell owned real property in Littlerock, California. The parcel was subdivided into a “north half’ and a “south half.” Nickell intended to sell the north half to defendant Tonie Matlock and to keep thе south half for himself. Defendant Paul Matlock, Tome’s husband, was not a party to the transaction. The escrow company prepared a grant deed that incorrectly described the transferred property as the entire parcel. Nickell discovered the misdescription before the closing date and brought it to the attention of the escrow agent. He was told the escrow company would correct the error after the closing. On August 3, 2006, Nickеll executed the grant deed conveying the entire parcel to Tonie Matlock. The deed was recorded on August 29, 2006, and escrow closed. The escrow company never corrected the error in the deed.
After the sale, Nickell lived on the south half of the parcel, where he built a house. The Matlocks lived on the north half in a house built before the sale.
On April 2, 2007, Nickell filed this quiet title action against the Matlocks. Amended complaints followed. The second amended complaint became the operative complaint. The Matlocks filed a verified answer to each of the three complaints.
Discovery commenced. The Matlocks repeatеdly failed to appear for their depositions even though the trial court ordered their appearance. Nickell moved for terminating and monetary sanctions. On July 28, 2009, the trial court, Judge Brian C. Yep presiding, granted the motion as to Paul Matlock only, awarding monetary sanctions in the amount of $715 and ordering that Paul’s answer be stricken and his default entered. Tonie Matlock met the same fate by order dated December 10, 2009, but without monetary sanctions.
On August 10, 2010, the triаl court, Commissioner Robert A. McSorely presiding, entered judgment, quieting title in favor of Nickell. The judgment recites that the Matlocks appeared in the case and that their answers were stricken and their defaults entered. The docket entries in the trial court reflect that no evidentiary hearing was held. The judgment does not indicate otherwise but states that “evidence ha[s] been introduced by the declaration [sic] of Jerry Nickell and his attorney.”
The record dоes not show that the clerk of court or a party served the Matlocks with a file-stamped copy of the judgment or a “notice of entry” of the judgment.
On September 23, 2010, Tonie Matlock filed a motion to vacate the default and the default judgment. Paul did not file such a motion. By order dated December 14, 2010, the trial court denied Tonie’s motion. Nickell contends the motion was denied by order on October 13, 2010.
Tonie Matlock filed an appeal from the judgment on January 14, 2011. Paul Matlock separately appealed on February 4, 2011. The two appeals were assigned the same case number in this court.
Nickell filed a motion as to each appeal, seeking their dismissal as untimely. We deferred ruling on the motions until we considered the appeals.
DISCUSSION
“Because [these appeals involve] the application of a statute to undisputed facts, we are presented with a question of law and reviеw the trial court’s decision de novo.” (Gonzalez v. County of Los Angeles (2004)
Nickell contends neither appeal is timely. The Matlocks argue to the contrary. They also assert that, notwithstanding the entry of default, they should have been allowed to present their claims to the property at a prejudgment evidentiary hearing. We address timeliness first and conclude that both appeals are timely. On the second issue, we agree with the Matlocks that, under section 764.010, they are entitled to participate in a prejudgment evidentiary hearing to determine the ownership of the property.
A. Timeliness of Appeals
Nickell asserts that the time within which the Matlocks had to appeal started to run upon the imposition of terminating sanctions—when ¿heir answers were stricken and their defaults entered—not when the judgment was entered. He is wrong. An order granting terminating sanctions is not appeal-able, and the losing party must await the entry of the order of dismissal or judgment unless the terminating order is inextricably intertwined with another, appealable order. (Doe v. United States Swimming, Inc. (2011)
The judgment was entered on August 10, 2010. Neither the clerk of court nor a party served a file-stamped copy of the judgment on the Matlocks, nor was a “notice of entry” of the judgment served. The Matlocks therefore had a maximum of 180 days from ¿he day judgment was entered within which to
Tonie Matlock filed an appeal on January 14, 2011—157 days after judgment was entered. Her appeal is therefore timely regardless of any tolling.
Paul Matlock filed an appeal on February 4, 2011—178 days after judgment was entered. Thus, his appeаl is timely. NickelPs motions to dismiss the appeals are accordingly denied.
B. Participation in Evidentiary Hearing
One of the statutes governing quiet title actions, section 764.010, states: “The court shall examine into and determine the plaintiff’s title against the claims of all the defendants. The court shall not enter judgment by default but shall in all cases require evidence of plaintiff’s title and hear such evidence as may be offered respecting the claims of any of the defendants, other than claims the validity of which is admitted by the plaintiff in the complaint. The court shall render judgment in accоrdance with the evidence and the law.” (Italics added.)
In Harbour Vista, LLC v. HSBC Mortgage Services Inc. (2011)
As Harbour Vista explained: “The Legislature has not left anything to the imagination about whether a trial court can enter a default judgment in a quiet title action. ‘The court shall not enter default judgment’ is unequivocal. Moreover, unlike the ordinary default prove-up, in which a defendant has no right to participate . . . , before entering any judgment on a quiet title cause of action the court must ‘in all cases’ ‘hear such evidence as may be offered respecting the claims of any of the defendants’.... Although the statute does not spell out who offers this evidence among the three possible candidates— the plaintiff, the court, or the defendant—the only sensible alternative is the defendant.” (Harbour Vista, supra,
In general, “after a plaintiff has obtained a default [against a defendant who failed to file a timely response to the complaint], the defendant no
“[I]t is not true . . . that allowing a defendant to participate in a quiet title judgment hearing nullifies the legal effect of a default. . . . [Sjection 764.010 does not prohibit a quiet title plaintiff from taking a defendant’s default. Once that happens, the defendant is severely disadvantaged. The plaintiff is no longer required to serve documents on it or give notice of any future court dates. . . . This cuts the defendant off from the most readily available source of information about the case. The defendant also cannot participate in any other hearings or conferences with the court. In fact, the most likely outcome is that the defaulting defendant will not learn of the hearing to adjudicate title until it is too late to attend.” (Harbour Vista, supra, 201 Cal.App.4th at pp. 1504-1505, citation omitted.)
The court in Harbour Vista continued: “[Ajllowing a defaulting defendant to participate in a hearing is unusual—verging on unique. But, then again, real property is unique, and the vast majority of these actions deal with real property. Perhaps the rationale behind the legislative creation of this juridical platypus can be gleaned from the history of the statute. [][] . . . [f]
“. . . [0]nce a quiet title judgment on any grounds becomes final, it is good against all the world as of the time of the judgment. There is, for all practical purposes, no going back. Given the frequency with which quiet title actions involve real property—which is recognized as unique—it is understandable that the Legislature would want to take every precaution to assure title is adjudicated correctly. These precautions could reasonably include allowing a defendant having some claim to the property to present evidence, even if it has been dilatory in responding beforehand. Under these circumstances, suspending the prohibition against allowing a defaulting defendant to participate in an adjudication hearing seems not at all farfetchеd.” (Harbour Vista, supra, 201 Cal.App.4th at pp. 1505-1506.)
In Harbour Vista, the dissenting justice argued that section 764.010 required the plaintiff to put on evidence of the defendant’s claims, not that the defendant itself be allowed to do so. (Harbour Vista, supra, 201 Cal.App.4th at pp. 1510-1512 (cone. & dis. opn. of Aronson, J.).) The majority disagreed,
The dissent in Harbour Vista also expressed concern that a defaulting defendant could appear for the first time at the prejudgment evidentiary hearing and present evidence of a claim to the property that the plaintiff did not reasonably anticipate. (See Harbour Vista, supra, 201 Cal.App.4th at pp. 1514, 1516-1517 (cone. & dis. opn. of Aronson, J.).) But as the majority emphasized: “[A] defendant who pulled such a stunt would hardly find favor with the trial court, which would, in all likelihood, continue the hearing to allow the plaintiff to respond to the newly presented evidence. We are confident of the trial courts’ ability to forestall trials by ambush.” (Id. at p. 1505 (maj. opn.), fn. omitted.) “Even if the defaulting defendant appeared at the last minute out of desperation, having just found out about the hearing, and presented evidence the court and the plaintiff had not seen, we would expect the court to сontinue the hearing.” (Id. at p. 1505, fn. 9.)
For his part, Nickell distinguishes Harbour Vista on the ground that the defendant in that case failed to make an appearance, while the Matlocks, who filed an answer to each complaint, made their claims known during the course of the litigation. The Matlocks also misused the discovery process by violating court orders to be deposed, resulting in their defaults. We find this distinction to be of no consequence, as we now explain.
Nickell correctly states that, as prоvided in the Code of Civil Procedure, a trial court may impose sanctions on a party for misusing discovery, including “[a]n order rendering a judgment by default.” (§ 2023.030, subd. (d)(4), italics added.) But as that code also provides: “The statutes and rules governing practice in civil actions generally apply to [quiet title] actions . . . except where they are inconsistent with the [quiet title] provisions . . . .” (§ 760.060, italics added.) Section 764.010—the quiet title provision that prohibits judgments by default—contains no language
Regardless of the reason for the entry of default—failing to appear or misusing discovery—quiet title actions should be exempt from а judgment by default because “once a quiet title judgment on any grounds becomes final, it is good against all the world as of the time of the judgment.” (Harbour Vista, supra,
We also disagree with Nickell’s contention that the Matlocks’ disclosure of evidence during discovery satisfies the dictates of section 764.010. Discovery proceedings are not the legal equivalent of a prejudgment evidentiary hearing to determine the merits of a quiet title action. Such a hearing is
As Division Five of this appellate district held in Yeung v. Soos (2004)
Yeung was the first case to construe section 764.010. (See Yeung, supra,
In dicta, Yeung cited secondary authority—Weil and Brown, California Practice Guide: Civil Procedure Before Trial (The Rutter Group 2003) paragraph 5:271, page 5-59—for the proposition that section 764.010 does not prohibit judgments by default but “ ‘seems only to require a higher standard of evidence at the “prove-up” hearing [].’ ” (Yeung, supra,
Harbour Vista rejected the notion, suggested in Yeung, that sectiоn 764.010 merely “ ‘ “require[s] a higher standard of evidence at the ‘prove-up’ hearing [].” ’ ” (Harbour Vista, supra,
We agree with Harbour Vista that the dicta in Yeung is erroneous, specifically: “ ‘[T]he provision against default judgments [in quiet title actions] appears to be a misnomer; i.e., it seems only to require a higher standard of evidence at the “prove-up” hearing [].’ ” (Yeung, supra,
Further, we clarify Yeung’s comment—“a plaintiff does not have a right to entry of judgment in his or her favor as a matter of course following entry of the defendant’s default . . .” (Yeung, supra,
Finally, Tonie Matlock, but not Paul, argues the trial court exhibited bias in granting terminating sanctions. She also contends Nickell’s counsel had a conflict of interest and one of his attorneys committed perjury in seeking terminating sanctions. No evidence or authority is cited to support these conclusory assertions. Accordingly, they are forfeited. (See Cal. Rules of Court, rule 8.204(a)(1)(B), (C); City of Lincoln v. Barringer (2002)
In sum, the judgment is reversed, and the Matlocks are entitled on remand to particiрate in an open-court evidentiary hearing to determine the merits of the quiet title action.
DISPOSITION
Plaintiff’s motions to dismiss the appeals as untimely are denied. The judgment is reversed and, on remand, the trial court shall permit defendants to participate in an open-court evidentiary hearing to determine the merits of the action. Defendants are entitled to costs on appeal.
Rothschild, J., and Chaney, J., concurred.
Respondent’s petition for review by the Supreme Court was denied August 15, 2012, S203985.
