Hacker v. American Home Mortgage Servicing CA2/1 ( 2021 )

Filed 4/2/21 Hacker v. American Home Mortgage Servicing CA2/1
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 not certified for publication or ordered published, except as specified by rule
8.1115(b). This opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION ONE
RON HACKER, B301193
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC610795)
v.
AMERICAN HOME MORTGAGE
SERVICING, INC., et al.,
Defendants and
Respondents.
APPEAL from a judgment of the Superior Court of Los
Angeles County. John P. Doyle, Judge. Reversed and remanded.
Law Offices of Vincent J. Quigg, Vincent J. Quigg; Law
Offices of Joseph P. Simon, Joseph P. Simon for Plaintiff and
Appellant.
Doyle & Harris, Christopher H. Doyle for Defendant and
Respondent Sand Canyon Corporation.
Wright, Finlay & Zak, Todd E. Chvat, Jonathan D. Fink,
and Charles C. McKenna for Defendants and Respondents
Homeward Residential, Inc. f/k/a American Home Mortgage
Servicing, Inc.; Deutsche Bank National Trust Company, as
Trustee For Soundview Home Loan Trust 2006-Opt 3, Asset-
Backed Certificates, Series 2006-Opt 3; Western Progressive,
LLC; Ocwen Loan Servicing, LLC; Wells Fargo Bank, N.A., as
Trustee For Option One Mortgage Loan Trust 2006-2; Power
Default Services, Inc.; Brandy Berns; and Vicki Pospisil.
___________________________________
A property owner sued several financial entities and
individuals for claims arising from an allegedly void assignment
of a deed of trust. The trial court sustained demurrers to the
complaint without leave to amend, but we reversed the resulting
judgment and directed the court to grant leave to amend. The
owner filed a second amended complaint two days beyond the
statutory 30 days after remittitur, which defendants moved to
have stricken. The court granted defendants’ motion, entered a
judgment of dismissal, and denied the owner relief from the
dismissal pursuant to the discretionary provision of Code of Civil
1
Procedure section 473, finding no surprise, mistake, or excusable
neglect.
The owner again appeals, contending the court abused its
discretion in denying him relief pursuant to section 473. We
conclude the court should have granted mandatory relief, and
therefore reverse.
1
All undesignated statutory references will be to the Code
of Civil Procedure.
2
BACKGROUND
A. Original and First Amended Complaints
Ron Hacker filed an original and then first amended
complaint, alleging that as successor trustee to the 1713 Stearns
LaVerne Family Trust, he owned an interest in real property
located at 1713-1717 Stearns Drive in Los Angeles, California.
Hacker asserted claims arising from a breached short sale
agreement and a void assignment of a deed of trust against the
following defendants: Homeward Residential, Inc.; Sand Canyon
Corporation; Western Progressive, LLC; Deutsche Bank National
Trust Company, as Trustee for Soundview Home Loan Trust
2006-OPT 3, Asset-Backed Certificates, Series 2006-OPT 3;
Ocwen Loan Servicing, LLC; Linda Greene; Brandy Berns; DOC
X; Larraine Brown; Vicki Pospisil; Wells Fargo Bank, N.A., as
Trustee for Option One Mortgage Loan Trust 2006-2; Power
Default Services, Inc.; T.D. Service Company; and AHMSI
Default Services.
On July 25, 2016, the trial court sustained defendants’
demurrers to the first amended complaint without leave to
amend.
On April 10, 2018, Barry Coleman, Hacker’s attorney,
suffered a debilitating stroke.
In an opinion filed on August 16, 2018, we affirmed the
sustaining of defendants’ demurrers, because “Hacker failed to
allege facts establishing an ownership interest in the property
sufficient to confer standing.” (Hacker v. Homeward Residential,
Inc. (2018) 26 Cal.App.5th 270, 277.) We also held that Hacker
was “time-barred from pursuing a cause of action for fraud.” (Id.
at p. 282.) However, we reversed the court’s denial of leave to
amend—except with respect to the fraud cause of action—
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because Hacker had presented the trial court with a grant deed
purportedly evidencing his ownership of the property. We held:
“Hacker has not shown that he can amend the fraud cause of
action to allege facts sufficient to state a claim, but he has
pleaded facts sufficient to establish causes of action for wrongful
foreclosure and the remaining actions that derive therefrom.”
(Id. at pp. 279-280.)
We remanded the matter with a direction to grant leave to
amend, issuing our remittitur on October 18, 2018.
B. Second Amended Complaint
Pursuant to section 472b, Hacker then had until Monday,
November 19, 2018, to file his second amended complaint.
A week after the remittitur, on October 25, 2018, Hacker
emailed a prior attorney, Danny Chase, about filing a second
amended complaint. Chase, who had had a career change,
responded neither to this nor several subsequent emails.
Around November 11, 2018, Hacker asked attorney Vincent
J. Quigg to represent him. Quigg agreed, but stated he had
insufficient time to draft and file a second amended complaint.
Hacker contacted his appellate counsel, Richard Antognini,
who on November 14, 2018, asked defendants’ counsel for an
extension of time to file a second amended complaint. On
November 15, defendants indicated they would not stipulate to
an extension. Antognini thereupon advised Hacker to substitute
in new counsel “immediately,” file an ex parte motion to extend
the deadline, and, if that was denied, draft and file the amended
complaint no later than Monday, November 19, which he advised
was “the last day.”
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On November 15, 2018, four days before the filing deadline,
Hacker formally retained attorney Vincent J. Quigg to represent
him.
On November 16, 2018, Quigg moved ex parte for an
extension of time to file an amended complaint. The motion was
denied.
At 8:30 p.m. on November 19, 2018, four hours after the
filing deadline, Quigg faxed a 150-page second amended
complaint to the superior court. (The court accepts filing by
facsimile transmission up to 4:30 p.m. on court days, although its
fax machine will receive transmissions after that time. Any
transmission after 4:30 will be deemed filed the next day. (LASC
Local Rules, rule 2.22(b)(2)).) On November 21, the court rejected
Quigg’s filing because one of the 150 pages had failed to transmit.
On November 21, 2018, Quigg successfully filed the
amended complaint, asserting causes of action based on wrongful
foreclosure and fraud.
C. Motions to Strike the Second Amended Complaint
Defendants filed two motions to strike the amended
complaint, one by Sand Canyon Corporation and the other by the
remaining defendants as a group. Sand Canyon argued (1) the
amended complaint was untimely because it was filed beyond the
statutory 30-day period after remittitur, and (2) the complaint
asserted a cause of action for fraud, contravening our holding
that the cause of action could not be reasserted. The remaining
defendants argued only that the amended complaint was
untimely.
By the time of the hearing on February 26, 2019, no
opposition to defendants’ motions existed in the court’s file or was
reflected in the docket, and defendants represented they had
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received none. Quigg nevertheless represented that he had filed
and served an opposition. After oral argument, the court
continued the matter to April 5, 2019, and instructed Quigg to
file and serve oppositions by March 8.
On March 14, 2019, six days beyond the court’s deadline,
Quigg emailed defendants oppositions to their motions,
oppositions he apparently never filed. In them, he argued the
fraud cause of action was legally sufficient, and the second
amended complaint was timely filed on November 19, 2018, but
“[t]o counsel’s surprise, Plaintiff’s filing was rejected by the court
on November 21, 2018,” and “[t]o Plaintiff’s counsel’s further
surprise, the court clerk rejected the fax filing as only 149 of 150
pages were received.” Quigg supported the oppositions with his
declaration, in which he stated, “On November 19, 2018, I gave
the final draft a last and final review, signed the amendment and
directed my staff to fax file. [¶] Being that the filing was 150
pages, it took hours to transmit to the courts.” Quigg attached to
his declaration an unauthenticated fax activity log indicating
that a 150-page fax was sent on November 19, 2018, the
transmission taking 52 minutes to complete, and completing at
8:32 p.m.
On the April 5, 2019 hearing date, the trial court issued a
tentative ruling in which it found that the amended complaint
was untimely filed, and granted defendants’ motion to have it
stricken. After the hearing, the tentative became the final ruling.
In it, the court observed that Hacker’s attempt to file the second
amended complaint on November 19, 2018 was untimely by four
hours. The court stated that “even if his initial fax filing had
been successful, the SAC would have been deemed filed on
November 20, 2018, which is still one day late.” “Plaintiff’s
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evidence demonstrates that the subject fax transmission was sent
on November 19, 2018, at 8:32 PM. . . . Further, the Court
stamped Plaintiff’s attempted filing as being received on
November 20, 2018.”
D. Section 473 Motions
Hacker filed two motions to set aside the resulting
dismissal pursuant to both the mandatory and discretionary
provisions of section 473. In the first, filed in May 2019, he
repeated his argument that the tardiness of his amended
complaint came as a surprise, because Quigg had timely directed
his staff to file the complaint. Hacker supported the motion with
Quigg’s declaration, wherein he stated: “In the early afternoon of
November 19, 2018, I gave the final draft a last and final review,
signed the amendment and directed my staff to fax file the
Second Amended Complaint. [¶] My office received confirmation
that the fax filing was completed on November 19, 2018.” The
trial court found that Quigg’s declaration failed to indicate “how
there was surprise,” which in any event would not justify relief
where the client had also been dilatory.
In August 2019, Hacker “renewed” his motion, and
submitted declarations of himself and Coleman “as additional
evidence of mistake, inadvertence, and/or neglect.” Hacker
argued that his “last-minute retention of Mr. Quigg” on
November 15, 2018, was caused by Coleman’s unavailability due
to his stroke, and Antognini caused another two days of delay by
misadvising him to file a futile ex parte motion for extension of
the filing deadline. The court denied the motion on procedural
grounds, finding it to be an inadequate motion for
reconsideration. It also found the motion to be substantively
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meritless, because Quigg failed adequately to explain why he
missed the filing deadline.
On August 29, 2019, the court dismissed the lawsuit.
Hacker timely appealed.
After oral argument, we requested supplemental briefing
on whether Hacker had a reasonable opportunity before the
hearing on his section 473 motion to explain the four-hour filing
delay.
DISCUSSION
A. The Order Denying Ex Parte Relief is Nonappealable
Hacker contends the trial court abused its discretion in
denying his ex parte motion for an extension of time to file the
second amended complaint. We have no jurisdiction to entertain
this claim.
Absent some statutory or other exception, an order that
“fails to dispose of all the causes of action pending between the
parties is generally not appealable.” (Kurwa v. Kislinger (2013)
57 Cal.4th 1097, 1100; see § 904.1.) A final order or judgment is
one that “terminates the litigation between the parties on the
merits of the case and leaves nothing to be done but to enforce by
execution what has been determined.” (Sullivan v. Delta Air
Lines, Inc. (1997) 15 Cal.4th 288, 304.) The trial court’s order
denying Hacker’s motion to extend the filing deadline did not
terminate this litigation, and falls within no exception for
appealability. Therefore, we may not entertain Hacker’s claim
that the trial court erred in denying an extension.
B. The Court Improperly Denied Relief Under the
Mandatory Provision of Section 473
Subdivision (b) of section 473 provides for both
discretionary and mandatory relief: “The court may, upon any
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terms as may be just, relieve a party . . . from a . . . dismissal . . .
taken against him or her through his or her mistake,
inadvertence, surprise, or excusable neglect. . . .
Notwithstanding any other requirements of this section, the court
shall, whenever an application for relief is made no more than six
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 . . .
resulting . . . dismissal entered against his or her client, unless
the court finds that the . . . dismissal was not in fact caused by
the attorney’s mistake, inadvertence, surprise, or neglect. The
court shall, whenever relief is granted based on an attorney’s
affidavit of fault, direct the attorney to pay reasonable
compensatory legal fees and costs to opposing counsel or parties.”
(§ 473, subd. (b), italics added.)
“Under the discretionary relief provision, on a showing of
‘mistake, inadvertence, surprise, or excusable neglect,’ the court
has discretion to allow relief from a ‘judgment, dismissal, order,
or other proceeding taken against’ a party or his or her attorney.
Under the mandatory relief provision, on the other hand, upon a
showing by attorney declaration of ‘mistake, inadvertence,
surprise, or neglect,’ the court shall vacate any ‘resulting default
judgment or dismissal entered.’ ” (Leader v. Health Industries of
America, Inc. (2001) 89 Cal.App.4th 603, 615-616 (Leader).) “The
range of attorney conduct for which relief can be granted in the
mandatory provision is broader than that in the discretionary
provision, and includes inexcusable neglect.” (Id. at p. 616.) “The
term ‘surprise,’ as used in section 473, refers to ‘ “some condition
or situation in which a party . . . is unexpectedly placed to his
injury, without any default or negligence of his own, which
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ordinary prudence could not have guarded against.” ’ ” (State
Farm Fire & Casualty Co. v. Pietak (2001) 90 Cal.App.4th 600,
611.)
“The law strongly favors trial and disposition on the merits.
Therefore, any doubts in applying section 473 must be resolved in
favor of the party seeking relief. When the moving party
promptly seeks relief and there is no prejudice to the opposing
party, very slight evidence is required to justify relief. We will
more carefully scrutinize an order denying relief than one which
permits a trial on the merits.” (Mink v. Superior Court (1992) 2
Cal.App.4th 1338, 1343.)
We review de novo whether Hacker was entitled to
mandatory relief. (Leader, supra, 89 Cal.App.4th at p. 612.)
“To obtain mandatory relief under section 473, plaintiffs’
counsel need not show that his or her mistake, inadvertence,
surprise or neglect was excusable. No reason need be given for
the existence of one of these circumstances. Attestation that one
of these reasons existed is sufficient to obtain relief, unless the
trial court finds that the dismissal did not occur because of these
reasons.” (Graham v. Beers (1994) 30 Cal.App.4th 1656, 1660.)
“The purpose of the attorney affidavit provision ‘is to relieve the
innocent client of the burden of the attorney’s fault, to impose the
burden on the erring attorney, and to avoid precipitating more
litigation in the form of malpractice suits.’ ” (Lorenz v.
Commercial Acceptance Ins. Co. (1995) 40 Cal.App.4th 981, 990.)
Although section 473 on its face affords mandatory relief
from “dismissal,” courts have construed it as limited to those
dismissals that are “ ‘the procedural equivalent of defaults—i.e.,
those which occur because the plaintiff’s attorney has failed to
oppose a dismissal motion.’ ” (Generale Bank Nederland v. Eyes
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of the Beholder Ltd. (1998) 61 Cal.App.4th 1384, 1397.) The
purpose of the statute is “to put plaintiffs whose cases are
dismissed for failing to respond to a dismissal motion on the same
footing with defendants who are defaulted for failing to respond
to an action” (Peltier v. McCloud River R.R. Co. (1995) 34
Cal.App.4th 1809, 1824 (Peltier), i.e., “to alleviate the hardship on
parties who lose their day in court” Huens v. Tatum (1997) 52
Cal.App.4th 259, 264, disagreed with on other grounds in Zamora
v. Clayborn Contracting Group, Inc., supra, 28 Cal.4th at pp. 256-
257). A party whose attorney has already opposed a motion to
dismiss has had his day in court.
Therefore, courts have roundly held that discretionary
evaluations of an attorney’s misfeasance in the context of a
motion to strike an untimely pleading pursuant to sections 436
and of 581, subdivision (f)(2) cannot be nullified by an affidavit of
fault under section 473. (Castro v. Sacramento County Fire
Protection Dist. (1996) 47 Cal.App.4th 927, 933 [dismissal entered
for lapse of the limitations period]; Bernasconi Commercial Real
Estate v. St. Joseph’s Regional Healthcare System (1997) 57
Cal.App.4th 1078, 1080 [failure to serve a complaint in a timely
manner]; Peltier, supra, 34 Cal.App.4th at p. 1817 [failure to
prosecute]; Leader, supra, 89 Cal.App.4th at p. 620 [failure to file
an amended complaint after a demurrer has been sustained with
leave to amend].) “[N]early every discretionary dismissal is
caused by the mistake, inadvertence or neglect of the plaintiff’s
attorney.” (Peltier, at p. 1816.) If this vast majority of plaintiffs
whose actions are dismissed on account of attorney neglect could
obtain mandatory relief from dismissal under section 473, that
section would “in effect nearly nullif[y] the discretionary
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dismissal statutes, as few dismissals entered thereunder would
ever assuredly be final.” (Ibid. 1816.)
Although here, Hacker’s attorney opposed a motion to
dismiss, he did not do so on grounds such as would permit full
briefing and consideration of the four-hour delay in fax filing the
second amended complaint on November 19, 2018. Nothing in
the record indicates that the parties briefed and argued the
impact of Quigg’s four-hour filing delay as part of the defendants’
motions to strike the second amended complaint, which were
grounded solely on the two-day delay. That delay was mentioned
for the first time in the court’s order granting the motions.
Therefore, the mandatory provision of section 473 remained
a viable option to vacate dismissal. (See Leader, supra, 89
Cal.App.4th at pp. 617, 619 [default results only from failure to
appear].)
We conclude the trial court erred in denying mandatory
relief. Such relief need be accompanied only by an attorney’s
declaration of his or her mistake, inadvertence, surprise, or
neglect. Here, Hacker declared that he reviewed the second
amended complaint in the early afternoon of November 19, 2018,
and gave it to his staff, but that the filing was not achieved until
four hours after the deadline due to the mistake, inadvertence,
surprise, or neglect of his staff. This sufficed for mandatory
provision relief under section 478. Because of our holding, we
need not address discretionary relief under section 473.
We will therefore remand the matter with directions to
grant Hacker relief under the mandatory provision of section 473
and order whatever equitable relief the trial court deems
appropriate. (§ 473, subd. (c).)
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Defendants argue that mandatory relief was unavailable in
any event because the true underlying cause of the untimely
filing was Hacker himself, not Quigg. We disagree. Although
Hacker delayed somewhat in retaining Quigg, he lost one
attorney to a medical condition and a second to a career change,
and made efforts to seek representation through his appellate
attorney, eventually retaining Quigg. And when time came to file
the second amended complaint, Hacker was refused even a
minimal extension. He nevertheless retained Quigg in time to
file the second amended complaint. We therefore conclude that
Hacker was not at fault for the late filing, which was in fact
caused by Quigg or his staff.
DISPOSITION
The judgment is reversed and the matter remanded for
further proceedings. Each side is to bear its own costs on appeal.
NOT TO BE PUBLISHED
CHANEY, J.
We concur:
ROTHSCHILD, P. J.
BENDIX, J.
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