Wong v. Mah CA2/7 ( 2020 )

Filed 11/18/20 Wong v. Mah CA2/7
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
IAT WONG, B301018
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. BC671700)
v.
GLENN MAH et al.,
Defendants and Appellants.
APPEAL from an order of the Superior Court of Los
Angeles County. Edward B. Moreton, Judge. Affirmed.
James & Associates, Becky S. James, and Lisa M. Burnett,
for Defendants and Appellants.
Fox Rothschild, John Shaeffer, and Henry Whitehead, for
Plaintiff and Respondent.
INTRODUCTION
Iat Wong sued Joseph Johnson, Glenn Mah, Clarence Mah,
and several companies they partially owned after the companies
failed to repay a loan. Neither Johnson nor the Mahs responded
to the complaint, and the trial court entered a default and a
default judgment against them. Johnson and the Mahs appeal
the trial court’s order denying their motion to vacate the
judgment. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
A. Wong Sues on a Note
In August 2017 Wong filed this action alleging First Picks
Holdings, LLC (First Picks), a company partially owned by
Johnson and the Mahs, and several related entities (collectively,
the First Picks Entities) borrowed $1 million from Wong’s mother
in 2014 pursuant to a promissory note. Johnson and the Mahs
executed a collateral assignment in which they pledged their
ownership interests in First Picks as collateral “to be recovered
by [Wong’s mother] in the event of a default by” the First Picks
Entities. Wong’s mother subsequently assigned her rights under
the promissory note and collateral assignment to Wong.
Wong asserted causes of action for breach of contract
against the First Picks Entities, alleging they failed to repay the
loan by the maturity date, and against Johnson and the Mahs,
alleging they breached their obligations under the collateral
assignment. Wong alleged that, “[a]s a direct and proximate
result of [the First Picks Entities’] breach of the” promissory note
and Johnson’s and the Mahs’ “breach of the [c]ollateral
2
[a]ssignment,” Wong sustained damages “estimated to be in
excess of $1,000,000.00.” Wong sought monetary damages
against all defendants.
B. The Trial Court Enters the Defaults of, and a Default
Judgment Against, Johnson and the Mahs
Wong served Johnson and the Mahs with a summons and
complaint. In September 2017 the parties, through their counsel,
filed a stipulation to extend to October 9, 2017 the deadline for
Johnson and the Mahs to respond to the complaint. On
October 10, 2017 counsel for Wong notified counsel for Johnson
and the Mahs they had not filed a responsive pleading. Counsel
for Johnson and the Mahs stated they would file an answer that
week, but they did not. On October 19, 2017 Wong filed requests
for the entry of the defaults of Johnson and the Mahs, and the
trial court entered the defaults.
On November 14 and 17, 2017 counsel for Wong sent an
email to counsel for Johnson and the Mahs stating that Wong
intended to obtain a default judgment. On January 23, 2018,
having received no response, Wong filed a request for a default
judgment. Counsel for Wong served counsel for Johnson and the
Mahs with the request for a default judgment and the proposed
judgment. The proposed judgment sought monetary damages
against the First Picks Entities, Johnson, and the Mahs.
On November 21, 2018 the trial court entered a default
judgment against all defendants. The judgment awards Wong a
total of $1 million in damages, not including prejudment interest.
The judgment provides that Johnson is jointly and severally
liable with the First Picks Entities for $520,308 of the $1 million
and that Glenn Mah and Clarence Mah are each jointly and
3
severally liable with the First Picks Entities, for $279,846 of the
$1 million.1 On December 13, 2018 Wong served Johnson and the
Mahs with the judgment.
C. Johnson and the Mahs File a Motion To Vacate the
Judgment, Which the Trial Court Denies
On March 8, 2019 the Mahs moved to vacate the default
judgment and set aside the entry of their defaults on several
grounds. First, they argued the mandatory provision of Code of
Civil Procedure section 473, subdivision (b),2 required the trial
court to vacate the entry of defaults and the default judgment
because the Mahs’ attorney, who advised them not to respond to
the complaint, was responsible for entry of the defaults. Second,
the Mahs asked the court to exercise its discretion to vacate the
entry of defaults and the default judgment under the
discretionary provision of section 473, subdivision (b), because
the Mahs believed Wong was seeking only to obtain their shares
in First Picks, not monetary damages, and they were “surprised”
when the court entered a judgment against them for monetary
damages. Third, the Mahs argued they failed to respond to the
complaint because of excusable neglect: Glenn Mah because he
relied on the advice of his attorney and was “consumed with the
collapse of certain business ventures,” Clarence Mah because he
1 Each of the First Picks Entities is jointly and severally
liable for $1 million, plus $30,329.34 in prejudgment interest.
Wong did not seek prejudgment interest against Johnson and the
Mahs. The total amount of the judgment against Johnson and
the Mahs cannot exceed $1 million.
2 Undesignated statutory references are to the Code of Civil
Procedure.
4
suffered from medical conditions causing cognitive decline and
did not understand the nature of the lawsuit. Johnson filed a
notice of joinder in the Mahs’ motion.
In opposition to the motion, Wong argued the mandatory
provision of section 473, subdivision (b), did not apply because,
although several of the Mahs’ attorneys filed declarations in
support of the motion, none of them admitted he was responsible
for, or committed a mistake that caused, the entries of default.
Wong also argued the discretionary provision of section 473,
subdivision (b), did not apply because Johnson and the Mahs did
not, as required, seek relief within six months of the entries of
default. In a supplemental brief filed at the court’s request,
Johnson and the Mahs argued that the judgment was “void”
because the collateral assignment only required them to transfer
to Wong their shares in First Picks in the event the First Picks
Entities defaulted and that Johnson and the Mahs never
personally guaranteed the loan.
On July 24, 2019, after a hearing without a court reporter,
the trial court denied the motion. Johnson and the Mahs timely
appealed.
DISCUSSION
A. The Motion by Johnson and the Mahs for
Discretionary Relief Under Section 473,
Subdivision (b), Was Untimely
“[S]ection 473, subdivision (b) ‘contains two distinct
provisions for relief from default’ [citation]—one makes relief
discretionary with the court; the other makes it mandatory.”
(Martin Potts & Associates, Inc. v. Corsair, LLC (2016)
5
244 Cal. App. 4th 432, 438; accord, Jackson v. Kaiser Foundation
Hospitals, Inc. (2019) 32 Cal. App. 5th 166, 173.) Johnson and the
Mahs sought relief from default under both provisions.
The discretionary provision of section 473, subdivision (b),
provides that “the 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. Application for this relief . . . shall be made within a
reasonable time, in no case exceeding six months, after the
judgment, dismissal, order, or proceeding was taken.” “The
general rule is that the six-month period within which to bring a
motion” for discretionary relief under section 473, subdivision (b),
“runs from the date of the default and not from the judgment
taken thereafter.” (Rutan v. Summit Sports, Inc. (1985)
173 Cal. App. 3d 965, 970; see Rappleyea v. Campbell (1994)
8 Cal. 4th 975, 980 [“more than six months had elapsed from the
entry of default, and hence [discretionary] relief under section
473 was unavailable”]; Pulte Homes Corp. v. Williams
Mechanical, Inc. (2016) 2 Cal. App. 5th 267, 273 [defendants’
motion for discretionary relief under section 473, subdivision (b),
“filed less than six months after entry of the default judgment,
but more than six months after entry of its default,” was
untimely]; Weiss v. Blumencranc (1976) 61 Cal. App. 3d 536, 541
[“[t]he court’s effort to set aside only the [default] judgments was
ineffective as the six-month period runs from the date of entry of
default rather than from the date of entry of the default
judgment”].) “The reason for the rule is that vacation of the
judgment alone ordinarily would constitute an idle act; if the
judgment were vacated the default would remain intact and
6
permit immediate entry of another judgment giving the plaintiff
the relief to which his complaint entitles him.” (Rutan, at p. 970;
see Pulte Homes Corp., at p. 273 [“‘“[i]f the judgment were
vacated, it would be the duty of the court immediately to render
another judgment of like effect, and the defendants, still being in
default, could not be heard in opposition thereto”’”].)
The rule applies here. Johnson and the Mahs filed their
motion to vacate the entries of default and the default judgment
within six months of entry of the judgment, but well over a year
after the trial court entered the defaults. Therefore, to the extent
they sought discretionary relief under section 473, subdivision
(b), for surprise or excusable neglect, the motion was untimely.
Johnson and the Mahs argue that the entry of default and
entry of judgment are separate events and that the court could
vacate the default judgment without “disturb[ing] the former.” It
doesn’t work that way. Had the court vacated the judgment
under the discretionary provision of section 473, subdivision (b),
but not also vacated the entries of default, Johnson and the Mahs
would have no “right[ ] to participate in the litigation” (Garcia v.
Politis (2011) 192 Cal. App. 4th 1474, 1479), and Wong could
simply obtain another default judgment. (See Pulte Homes
Corp. v. Williams Mechanical, Inc., supra, 2 Cal.App.5th at
p. 273.) To obtain meaningful relief from the default judgment,
Johnson and the Mahs would still have to show the judgment was
improper for some other reason.
The deadline is different, however, under the mandatory
provision of section 473, subdivision (b), which requires the court
to grant relief if the attorney for the moving party files an
affidavit of fault. That provision states that “the court shall,
whenever an application for relief is made no more than six
7
months after entry of judgment, is in proper form, and is
accompanied by an attorney’s sworn affidavit attesting to his or
her mistake, inadvertence, surprise or neglect, vacate any (1)
resulting default entered by the clerk against his or her client . . .
or (2) resulting default judgment or dismissal . . . unless the court
finds that the default or dismissal was not in fact caused by the
attorney’s mistake, inadvertence, surprise, or neglect.” Unlike
the discretionary provision of section 473, subdivision (b), the
mandatory provision of section 473, subdivision (b), states that
the six-month time limit runs from the “entry of judgment” and
requires the court to vacate both any “resulting default” and
“resulting default judgment.” (See Sugasawara v. Newland
(1994) 27 Cal. App. 4th 294, 297.)
Johnson and the Mahs filed their motions to vacate the
judgment within six months of the entry of the default judgment.
Therefore, to the extent Johnson and the Mahs sought relief
under the mandatory provision of section 473, subdivision (b),
based on an attorney affidavit of fault, the motion was timely.
(See Sugasawara v. Newland, supra, 27 Cal.App.4th at p. 297.)
The question, however, is whether Johnson and the Mahs filed a
proper attorney affidavit of fault. We will see that they did not.
B. The Trial Court Did Not Err in Denying the Motion
by Johnson and the Mahs Under the Mandatory
Provision of Section 473, Subdivision (b)
The mandatory provision of section 473, subdivision (b),
which requires the court to vacate the entry of default and an
ensuing default judgment where an attorney files an affidavit of
fault, is “a narrow exception to the discretionary relief provision
for default judgments . . . .” (Zamora v. Clayborn Contracting
8
Group, Inc. (2002) 28 Cal. 4th 249, 257.) “The purpose of this
provision ‘[is] to alleviate the hardship on parties who lose their
day in court due solely to an inexcusable failure to act on the part
of their attorneys.’” (Ibid.) “‘[I]f the prerequisites for the
application of the mandatory provision of section 473,
subdivision (b) exist, the trial court does not have discretion to
refuse relief.’” (Carmel, Ltd. v. Tavoussi (2009) 175 Cal. App. 4th
393, 399; see Solv-All v. Superior Court (2005) 131 Cal. App. 4th
1003, 1008 [“[i]f the statutory conditions are satisfied, the
court must grant relief”].) “Where, as here, the applicability of
the mandatory relief provision does not turn on disputed facts
and presents a pure question of law, our review is de novo.” (SJP
Limited Partnership v. City of Los Angeles (2006) 136 Cal. App. 4th
511, 516; accord, Carmel, Ltd., at p. 399.)
Johnson and the Mahs argue they met the requirements for
mandatory relief under section 473, subdivision (b), because the
judgment resulted from the errors of three attorneys, Steve
Korotash, Barney Balonick, and Fred Fenster, each of whom filed
a declaration in support of the motion to vacate the default
judgment. We will see, however, that none of the three attorneys
submitted a declaration that satisfied the requirements of an
attorney affidavit of fault to support mandatory relief under
section 473, subdivision (b).
1. Korotash’s Declaration Was Insufficient
Korotash submitted a declaration in support of the motion,
but he did not attest he made any mistake that caused the
default of Johnson or the Mahs. Korotash simply attached to his
declaration an email chain among himself, Glenn Mah, and
Fenster, one of Glenn Mah’s other attorneys, without providing
9
any further context. On November 14, 2017—after the court had
already entered the defaults of Johnson and the Mahs—Fenster
forwarded to Glenn Mah the November 14, 2017 email from
counsel for Wong stating Wong intended to seek a default
judgment. Glenn Mah forwarded this email to Korotash and
asked whether he had “additional guidance” on “how we should
proceed” with Wong. Korotash responded that they should “not
reach out to them until we can resolve, or at least get further
clarity” about, a pending SEC investigation against the Mahs.
Even assuming Korotash’s email was a sufficient substitute
for an “affidavit attesting to his . . . mistake” (§ 473, subd. (b)), a
dubious proposition,3 Korotash’s purported fault did not cause the
entries of the default. Section 473, subdivision (b), states that
the court is not required to grant relief from a “default” or the
“resulting default judgment” if “the court finds that the
default . . . was not in fact caused by the attorney’s mistake,
inadvertence, surprise, or neglect.” Here, Wong obtained the
3 Where the attorney does not admit fault in his declaration,
a party may still obtain relief under the mandatory provision of
section 473, subdivision (b), if the declaration “unmistakably
demonstrate[s the attorney’s] fault.” (Carmel, Ltd. v. Tavoussi,
supra, 175 Cal.App.4th at p. 400.) Here, it is not clear Korotash
was at fault for anything. Korotash did not advise Glenn Mah to
ignore any deadlines or refrain from seeking to set aside the
default. Korotash simply recommended that Glenn Mah not
respond to Wong (not necessarily to Wong’s complaint) until after
the Mahs obtained additional information about the SEC
investigation. Moreover, Korotash stated in his declaration that
he was licensed to practice law in Texas and that Glenn Mah
retained him for the SEC investigation, not for this action, and
Glenn Mah copied the attorney representing him in this action,
Fenster, on his emails to Korotash.
10
entries of default before Korotash sent the emails. Korotash did
not state that he had previously offered similar advice to
Glenn Mah (or even that he represented Glenn Mah prior to the
entries of default). Nor did Korotash state that he ever
represented Johnson or Clarence Mah or that he spoke to
Johnson or Clarence Mah about this action.
Cisneros v. Vueve (1995) 37 Cal. App. 4th 906 is on point. In
that case the defendants moved for relief from a default judgment
under the mandatory provision of section 473, subdivision (b),
based on their attorney’s neglect, even though it was undisputed
the defendants hired the attorney after the court had entered
their defaults. (Cisneros, at p. 910.) Like Johnson and the Mahs,
the defendants argued they were nonetheless entitled to
mandatory relief because “the default judgment [was] caused by
the attorney’s neglect,” even though the attorney had “nothing to
do with the underlying default.” (Ibid.) The court in Cisneros
disagreed, holding that “the Legislature’s specific and careful use
of both ‘default’ and ‘default judgment’ elsewhere in the statute
shows that it understood the two terms and the material
distinction between them” and chose to “authorize[ ] relief from
both default and default judgment,” while making “equally clear
that for mandatory relief to apply the court must also satisfy
itself that the default (i.e., the failure to respond) was in fact
caused by attorney mistake or neglect.” (Id. at pp. 910-911.)
Citing Behm v. Clear View Technologies (2015)
241 Cal. App. 4th 1, Johnson and the Mahs argue a court must
vacate a default judgment caused by an attorney’s error even if
the error did not cause the underlying default. Behm neither
addressed this issue nor supports their argument. In Behm the
defendant sought relief from the entry of default (not default
11
judgment) under the mandatory provision of section 473,
subdivision (b), which the trial court denied because it found the
attorney’s declaration of fault was not credible. (Behm, at
pp. 15-16.) The defendant separately sought to vacate the default
judgment on the ground that it did not receive adequate notice of
the amount of punitive damages awarded in the judgment. (Id.
at pp. 11-13.) In affirming the order granting relief, the court in
Behm held the trial court was not required to set aside the entry
of default simply because it vacated the default judgment on this
latter ground. (Id. at pp. 16-17.) Behm has no bearing on
whether a defendant may seek mandatory relief from a default
judgment if the attorney’s error did not cause the underlying
default.
2. Balonick’s and Fenster’s Declarations Were
Insufficient Too
Balonick and Fenster also submitted declarations in
support of the motion to vacate the default judgment. But
Johnson and the Mahs did not argue in the trial court they were
entitled to relief under the mandatory provision of section 473,
subdivision (b), based on these declarations; they argued only
that Korotash’s errors caused the default judgment. Therefore,
Johnson and the Mahs forfeited the argument they are entitled to
relief based on the declarations of Balonick and Fenster. (See
Johnson v. Greenelsh (2009) 47 Cal. 4th 598, 603; Colyear v.
Rolling Hills Community Assn. of Rancho Palos Verdes (2017)
9 Cal. App. 5th 119, 137, fn. 5.)
Even if not forfeited, the argument lacks merit. The
declarations of Balonick and Fenster are even more deficient for
purposes of the mandatory provision of section 473,
12
subdivision (b), than Korotash’s declaration. Balonick in his
declaration summarized Clarence Mah’s health issues and
described meeting and conferring with Wong’s counsel prior to
filing the motion to vacate the default judgment. Fenster
attached to his declaration a letter he sent to counsel for Wong in
September 2018—over a year after the court had entered the
defaults of Johnson and the Mahs—in which Johnson and the
Mahs proposed having the court enter a judgment requiring them
to give Wong their ownership interests in First Picks. Neither
Balonick nor Fenster stated they made any mistakes. The only
discussion of the circumstances causing the entries of default was
Balonick’s discussion of Clarence Mah’s health issues.
Johnson and the Mahs argue Balonick and Fenster would
“clearly” be at fault if Wong served them with his request for
entry of default judgment in January 2018 and Balonick and
Fenster “ignored [the request] without telling [their] clients.”
Perhaps. But neither Balonick nor Fenster stated in their
declarations this occurred. And even if they had, any purported
fault on the part of Balonick and Fenster in failing to respond to
Wong’s request for entry of default judgment would have
occurred well after the entries of default.
C. The Judgment Is Not Void
Johnson and the Mahs make three arguments why the
judgment is void. First, they argue the judgment requires them
to pay damages in excess of those alleged in the complaint.
Second, they argue the judgment erroneously awards Wong
monetary damages because, under the collateral assignment,
they did not agree to personally guarantee the loan to the First
13
Picks Entities. Third, they argue the judgment resulted from
extrinsic fraud. Each argument fails.
1. The Judgment Does Not Award Damages in
Excess of Those Wong Alleged in the Complaint
Section 580, subdivision (a), provides: “The relief granted
to the plaintiff, if there is no answer, cannot exceed that
demanded in the complaint, in the statement required by Section
425.11, or in the statement provided for by Section 425.115; but
in any other case, the court may grant the plaintiff any relief
consistent with the case made by the complaint and embraced
within the issue.”4 “Section 580 is strictly construed ‘in
accordance with its plain language’—‘a plaintiff cannot be
granted more relief than is asked for in the complaint.’
[Citation.] A default judgment greater than the amount
specifically demanded in the complaint is void as beyond the
court’s jurisdiction.” (Airs Aromatics, LLC v. CBL Data Recovery
Technologies, Inc. (2018) 23 Cal. App. 5th 1013, 1018; see Low v.
Golden Eagle Ins. Co. (2002) 101 Cal. App. 4th 1354, 1363 [“The
purpose of the rule that a plaintiff’s relief on default cannot
exceed the amount prayed for in the complaint ‘is to insure that
defendants in cases which involve a default judgment have
adequate notice of the judgments that may be taken against
4 Section 425.11, subdivision (b), requires the plaintiff to
serve a statement of damages in personal injury and wrongful
death cases before the court may enter the defendant’s default.
Section 425.115, subdivision (f), requires the plaintiff to serve a
statement before the court may enter a default judgment that
includes punitive damages. (See Behm v. Clear View
Technologies, supra, 241 Cal.App.4th at p. 9; Weakly-Hoyt v.
Foster (2014) 230 Cal. App. 4th 928, 932-933.)
14
them.’”].) “‘We review de novo the trial court’s determination
that a default judgment is or is not void’” on the ground it exceeds
the amount stated in the complaint. (Airs Aromatics, at p. 1018;
see Rodriguez v. Cho (2015) 236 Cal. App. 4th 742, 752.)
Wong alleged in his complaint that Johnson and the Mahs
breached the terms of the collateral assignment and that, “[a]s a
direct and proximate result of [their] breach,” Wong “sustained
damages according to proof at or before trial, estimated to be in
excess of $1,000,000.” In his prayer for relief Wong reiterated he
was seeking monetary damages from defendants “and each of
them.” (See Becker v. S.P.V. Construction Co. (1980) 27 Cal. 3d
489, 494 [“a prayer for damages according to proof passes muster
. . . if a specific amount of damages is alleged in the body of the
complaint”]; People ex rel. Lockyer v. Brar (2005) 134 Cal. App. 4th
659, 667 [“courts must look to the prayer of the complaint
or to ‘allegations in the body of the complaint of the damages
sought’ to determine whether a defendant has been informed of
the ‘maximum liability’ he or she will face for choosing to
default”]; National Diversified Services, Inc. v. Bernstein (1985)
168 Cal. App. 3d 410, 412 [plaintiff could obtain a default
judgment of $32,500 where the complaint sought “‘damages
which are in excess of $10,000,’” plus return of boat valued at
$22,500].) The default judgment does not require the individual
defendants collectively to pay more than $1 million in damages;
indeed, the judgment limits First Picks’ liability to $1 million;
Glenn Mah’s liability to $279,846 of the $1 million, Clarence
Mah’s to $279,846 of the $1 million, and Johnson’s to $520,308 of
the $1 million. The default judgment did not exceed the amount
demanded in the complaint.
15
2. The Judgment Is Not Void Because of the Terms
of the Collateral Assignment
Johnson and the Mahs argue the judgment is void because
the collateral assignment provides that, in the event the First
Picks Entities defaulted on the promissory note, Johnson and the
Mahs would only have to give Wong their interests in First Picks.
Johnson and the Mahs contend that, because they did not
personally guarantee the loan, Wong cannot recover monetary
damages from them.
A default judgment may be void for various reasons (in
addition to awarding damages in excess of those alleged in the
complaint), including that the court lacks subject matter
jurisdiction (Varian v. Medical Systems, Inc. v. Delfino (2005)
35 Cal. 4th 180, 196) and that the court does not have personal
jurisdiction over a defendant against whom the court entered
judgment (Strathvale Holdings v. E.B.H. (2005) 126 Cal. App. 4th
1241, 1250), such as where the plaintiff did not properly serve the
defendant with the summons and complaint (Ellard v. Conway
(2001) 94 Cal. App. 4th 540, 544). Johnson and the Mahs do not
cite any authority, however, suggesting a default judgment may
be void because the defendant against whom the court entered
judgment has a meritorious defense, not timely asserted, to the
complaint.
Citing Dill v. Berquist Construction Co. (1994)
24 Cal. App. 4th 1426, Johnson and the Mahs argue a judgment is
void on its face when its invalidity is apparent upon an inspection
of the judgment roll. (See id. at p. 1441.)5 Johnson and the Mahs
5 “‘A judgment roll is defined in section 670 . . . and consists
of the papers therein enumerated. This “roll” does not depend
upon the fact that the clerk has fastened these papers together,
16
argue that, because Wong attached the collateral assignment to
the complaint, we may independently review the terms of the
collateral assignment to determine whether the judgment awards
relief consistent with the terms of the collateral assignment. Dill
does not support Johnson and the Mahs’ argument. The court in
Dill, a personal injury case, did not independently review any
documents or consider the underlying merits of the case. The
court looked only to the proofs of service, which showed that the
plaintiff did not properly serve the defendants. (Id. at
pp. 1441-1442.)
Johnson and the Mahs are actually arguing, under the
guise of asserting the default judgment is void, that they did not
breach the terms of the collateral assignment or that they cured
any breach. Johnson and the Mahs contend that, well after the
court entered their defaults, they “offered to duly tender their
proportionate interests” in First Picks to Wong, “which was the
absolute most required of them by the collateral assignment,” an
offer Wong refused. To the extent they wanted to assert either of
nor do any other papers which the clerk may have joined with
those which the statute declares shall constitute the judgment
roll become a part of such roll by reason of having been so joined.
The papers thus designated as forming the judgment roll are
those which are elsewhere mentioned in the code as a part of the
proceedings culminating in the judgment.’” (Worthington Corp. v.
El Chicote Ranch Properties, Ltd. (1967) 255 Cal. App. 2d 316,
325.) “In cases where there is no answer filed by the defendant,
the judgment roll includes: ‘the summons, with the affidavit or
proof of service; the complaint; the request for entry of default
with a memorandum indorsed thereon that the default of the
defendant in not answering was entered, and a copy of the
judgment . . . .’” (Calvert v. Al Binali (2018) 29 Cal. App. 5th 954,
960.)
17
these defenses, however, they should have timely responded to
the complaint (or, if they had a legitimate excuse for their
defaults, timely moved to set them aside). By failing to do so,
Johnson and the Mahs admitted all the well-pleaded facts in the
complaint (see Molen v. Friedman (1998) 64 Cal. App. 4th 1149,
1153), including Wong’s allegation they failed to honor their
obligations under the collateral assignment. Johnson and the
Mahs chose not to respond to the complaint, gambling the court
would not award Wong monetary damages. They are not entitled
to relief because their gamble failed.
3. Johnson and the Mahs Forfeited Any Argument
the Judgment Resulted from Extrinsic Fraud
Finally, Johnson and the Mahs argue the judgment is void
as the result of extrinsic fraud. A judgment that results from
extrinsic fraud, however, is not void. Rather, the trial court has
discretion under its “inherent authority to vacate a default and
default judgment on equitable grounds,” including extrinsic
fraud. (Bae v. T.D. Service Co. of Arizona (2016) 245 Cal. App. 4th
89, 97; accord, County of San Diego v. Gorham (2010)
186 Cal. App. 4th 1215, 1228; see Rappleyea v. Campbell, supra,
8 Cal.4th at p. 981 [“a trial court may still vacate a default on
equitable grounds even if statutory relief is unavailable”].)
“‘Extrinsic fraud usually arises when a party is denied a fair
adversary hearing because he has been “deliberately kept in
ignorance of the action or proceeding, or in some other way
fraudulently prevented from presenting his claim or defense.”’”
(Bae, at p. 97; see County of San Diego, at pp. 1228-1229.) “We
review a challenge to a trial court’s order denying a motion to
vacate a default on equitable grounds,” such as extrinsic fraud,
18
“for an abuse of discretion.” (Rappleyea, at p. 981; accord, County
of San Diego, at p. 1230.)
Johnson and the Mahs did not ask the trial court to vacate
the judgment because of extrinsic fraud. Therefore, they forfeited
the argument. In addition, the parties dispute the facts relevant
to Johnson and the Mahs’ extrinsic fraud argument. (See
Krechuniak v. Noorzoy (2017) 11 Cal. App. 5th 713, 750 [“the
general rule” that a party may not raise a new theory on appeal
“is especially true when the theory newly presented involves
controverted questions of fact or mixed questions of law and
fact”].) Johnson and the Mahs contend Wong induced them to
believe he would request a default judgment that only awarded
him their shares in First Picks (despite the contrary allegations
in his complaint). Wong denies he ever said or implied he was
not seeking monetary damages. This is not an issue we can
decide on appeal, in the context of a forfeited extrinsic fraud
argument or otherwise. (See Estate of O’Connor (2017)
16 Cal. App. 5th 159, 163 [“‘It is not our task to weigh conflicts and
disputes in the evidence; that is the province of the trier of
fact.’”].)
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DISPOSITION
The order is affirmed. Wong is to recover his costs on
appeal.
SEGAL, Acting P. J.
We concur:
FEUER, J.
RICHARDSON, J.*
* Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.
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