Luxury Lease Company v. Maldonado CA2/8 ( 2024 )

Filed 10/28/24 Luxury Lease Company v. Maldonado CA2/8
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
LUXURY LEASE COMPANY, B324154
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. 21STCV21812)
v.
JORGE MALDONADO,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of
Los Angeles County. Randolph M. Hammock, Judge. Affirmed.
Law Office of Gary Kurtz and Gary Kurtz for Defendant
and Appellant.
Herzlich, Blum & Roza and Marta Roza for Plaintiff and
Respondent.
_________________________________
Defendant and appellant Jorge Maldonado appeals from a
judgment after the trial court denied his motion to set aside a
default and vacate a default judgment entered in favor of plaintiff
and respondent Luxury Lease Company (Luxury Lease). Luxury
Lease sued Maldonado after Maldonado leased a car from Luxury
Lease and then stopped making lease payments.
After Maldonado failed to answer the complaint, the trial
court entered a default against Maldonado and granted Luxury
Lease’s motion for default judgment. Maldonado moved to set
aside the default and vacate the default judgment under Code of
Civil Procedure1 sections 473, subdivision (d), and 473.5, alleging
that service was never effectuated. After holding an evidentiary
hearing, the trial court conditionally granted Maldonado’s motion
on the condition he answer the complaint. The trial court also
allowed Luxury Lease’s counsel to hold in a client trust account
the money it had already seized from Maldonado while the case
was pending. After Maldonado failed to answer the complaint,
the trial court denied the motion.
On appeal, Maldonado argues the trial court erred in
denying the motion, arguing there was insufficient evidence to
support the trial court’s conclusion that personal service was
effectuated. He also argues the trial court abused its discretion
by imposing an unlawful and unreasonable condition in allowing
Luxury Lease’s counsel to keep the seized money.
For the reasons stated below, we affirm.
1
All further undesignated statutory references are to the
Code of Civil Procedure.
2
FACTUAL AND PROCEDURAL BACKGROUND
On June 11, 2021, Luxury Lease sued Maldonado for
nonpayment on the lease of a 2018 Lamborghini Aventador,
alleging causes of action for: (1) breach of contract, (2) quantum
meruit, and (3) open book account. Luxury Lease alleged
Maldonado still owed the principal amount of $452,013.21 under
the terms of the lease agreement.
On the proof of service on the summons and complaint,
the process server indicated Maldonado was personally served on
July 15, 2021 at a residence where Maldonado was purportedly
living at the time. The residence was located in a gated
community with a gatekeeper, who confirmed Maldonado lived at
the residence. The proof of service describes four unsuccessful
attempts to serve Maldonado at this location. On the fifth
attempt, the process server witnessed Maldonado leaving the
residence’s garage and waved him down to give him the summons
and complaint. According to the process server, Maldonado
“[t]ried to say he wasn’t [the] subject and that no one by that
name lived at [the] residence and then drove away.” The process
server then “left [the] doc[uments] by [the] front door” and
declared he verified Maldonado’s “identity . . . by photograph.”
On September 7, 2021, Luxury Lease filed a request for
entry of default judgment against Maldonado. On October 27,
2021, the trial court entered a default judgment in favor of
Luxury Lease in the amount of $485,930.29. Luxury Lease then
executed a bank levy on a safety deposit box held in Maldonado’s
name, collecting approximately $107,000 in cash. On June 29,
2022, Maldonado filed a motion to set aside the default and
vacate the default judgment on the grounds the trial court never
obtained jurisdiction over him because the summons and
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complaint were never properly served. Maldonado also asked
that the money already seized be returned.
The trial court held an evidentiary hearing on Maldonado’s
motion. The process server testified that he spoke to a security
guard, who confirmed Maldonado’s name was still on the gated
community’s system as living at that address. The process server
also positively identified Maldonado at the hearing, stating there
was “[n]o doubt” in his mind that Maldonado was the driver of
the vehicle. He further testified that when he waved down the
car, the driver stopped and rolled down the window, and he
identified Maldonado as the driver. During the interaction, the
process server was approximately one foot away from the driver
when he said, “I’m dropping off some legal documents for Jorge
Maldonado. . . . You’re Jorge Maldonado? I have documents for
you.” The driver denied being Maldonado, rolled up the window
and drove away before the process server could say anything else.
As the car drove away, the process server yelled, “You’ve been
served” and left the documents, without an envelope, by the front
door of the house where the car had left the garage. The process
server did not follow up by mailing the documents because he
believed he had effectuated personal service.
Maldonado also testified. He stated that he was not the
driver of the vehicle approached by the process server and he was
not at the location listed on the proof of service on the date of
service. Maldonado declared that it was impossible for him to be
at the location of service because he was shopping with his
girlfriend at another location miles away. He also testified that
he had moved out from that location approximately two weeks
earlier from the date of service. Maldonado provided a copy of a
lease for another residence that began one month earlier, as well
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as a declaration from his previous landlord that the residence
listed on the proof of service was no longer occupied as it was
undergoing renovations. Maldonado claimed that he had never
received any documents related to the lawsuit and only found out
he had been sued when his bank notified him that his money had
been seized.
At the conclusion of the evidentiary hearing, the trial court
conditionally granted Maldonado’s motion to set aside the default
and vacate the default judgment. “After weighing all of the
submitted evidence, and after considering the demeanor and
potential motives of each of the witnesses, this [c]ourt finds that
it was more likely than not that it was [Maldonado] who was the
person present at the time of the service [of] process. Indeed,
common[ ] sense confirms this. This [c]ourt found the process
server’s testimony very credible; the same cannot be said for
[Maldonado’s] testimony. In view of [the] many facts,
[Maldonado’s] story did not ring true. [¶] As such, it appears that
[Maldonado] has attempted to commit a fraud upon this [c]ourt,
and that he is undeserving of any relief whatsoever.”
Despite its factual and credibility findings against
Maldonado, the trial court conditionally granted the motion given
the broad policy to determine cases on their merits. The trial
court imposed the following terms and conditions: (1) Maldonado
was required to file an answer to the complaint within 21 days;
(2) while the case was pending, Luxury Lease’s counsel would
keep possession of, and not distribute or disburse, the previously
seized funds in a client trust account; (3) upon completion of the
case, those funds would be distributed accordingly to the
appropriate party.
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Maldonado failed to file an answer and the trial court
deemed his failure as a rejection of its conditional ruling. It then
denied the motion to set aside the default and vacate the default
judgment. It further ordered Maldonado to file a partial
satisfaction of judgment based upon the seized money.
Maldonado appealed.
DISCUSSION
I. Governing law and standard of review
A party may move to set aside a default judgment under
section 473, subdivision (b), on the grounds that the default
resulted from mistake, inadvertence, surprise, or excusable
neglect. The moving party bears the burden of showing good
cause for relief. (Manson, Iver & York v. Black (2009)
176 Cal.App.4th 36, 42.)
A party may also move to set aside a default or default
judgment under section 473.5, subdivision (a), if “service of a
summons has not resulted in actual notice to a party in time to
defend the action.” The party’s motion must be accompanied by
an affidavit stating his or her lack of actual notice in time to
defend the action was not caused by his or her avoidance of
service or inexcusable neglect. (Id., subd. (b).)
We review an order granting or denying relief under
section 473, subdivision (b), or section 473.5 under the abuse of
discretion standard. (McClain v. Kissler (2019) 39 Cal.App.5th
399, 413 [§ 473, subd. (b)]; Rios v. Singh (2021) 65 Cal.App.5th
871, 885 [§ 473.5].) We liberally construe the provisions of
sections 473, subdivision (b), and 473.5 given the law favors the
determination of actions on their merits. (Elston v. City of
Turlock (1985) 38 Cal.3d 227, 233; Maynard v. Brandon (2005)
36 Cal.4th 364, 371–372 (Maynard).) Accordingly, we resolve any
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doubts in favor of the party seeking relief from default.
(Maynard, at p. 372.)
“The test for abuse of discretion is traditionally recited as
whether the trial court’s decision exceeded the bounds of reason.
[Citation.] In more practical terms, the abuse of discretion
standard measures whether, in light of the evidence, the lower
court’s decision falls within the permissible range of options set
by the legal criteria. [Citation.] The scope of the court’s
discretion is limited by law governing the subject of the action
taken. [Citation.] An action that transgresses the bounds of the
applicable legal principles is deemed an abuse of discretion.
[Citation.] A trial court’s decision is an abuse of discretion if it is
based on an error of law [citations] or if the court’s factual
findings are not supported by substantial evidence.” (Shapell
SoCal Rental Properties, LLC v. Chico’s FAS, Inc. (2022)
85 Cal.App.5th 198, 213.)
II. Analysis
Maldonado makes three arguments in support of his
contention that the trial court’s order denying his motion to set
aside the default and vacate the default judgment should be
reversed. First, he argues, even if we accept the process server’s
statements as true, the facts are insufficient as a matter of law to
support the finding that Maldonado was personally served.
Second, he argues, to the extent the trial court’s findings were
sufficient to prove he was personally served, the trial court’s
findings were not supported by substantial evidence. Last, he
argues the trial court abused its discretion by imposing an
unlawful and unreasonable condition in allowing Luxury Lease’s
counsel to keep the seized money while the case was pending.
Maldonado’s arguments are without merit.
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Maldonado’s first argument is that the process server failed
to personally serve him based on the process server’s interaction
with Maldonado before Maldonado drove away and by leaving the
documents at the doorstep of Maldonado’s purported residence.
Essentially, Maldonado argues, because the process server was
close enough to hand the summons and complaint to Maldonado
through the car’s open window, he should have done so. In
addition, Maldonado asserts the process server did not give
Maldonado any reason to stay at the location and then left the
documents on the doorstep of Maldonado’s purported residence
where they could be blown away, which was insufficient to
effectuate personal service.
We are unpersuaded. While personal service “ ‘usually
contemplates actual delivery,’ ‘the person on whom service is
sought may not, by merely declining to take the document
offered, deny the personal service on the ground of lack of
delivery, where under the circumstances it would be obvious to a
reasonable person that a personal service was being attempted.’ ”
(Crescendo Corp. v. Shelted, Inc. (1968) 267 Cal.App.2d 209, 212
(Crescendo).) “ ‘In such a case the service may be made by merely
depositing the process in some appropriate place where it would
be most likely to come to the attention of the person being
served.’ ” (Ibid.)
Assuming the truth of the process server’s statements,
which Maldonado has asked us to do here for the sake of his
argument, the trial court correctly found Maldonado was
personally served after he tried to evade service. “The process
server made five attempts to serve [Maldonado]. On the fifth, the
server instructed [Maldonado] that he had some ‘legal documents
to serve upon him,’ but [Maldonado] drove away. It was
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reasonable, then, to leave the documents at the front door of the
residence which [Maldonado] was leaving because it ‘would be
obvious to a reasonable person that a personal service was being
attempted.’ ”
While Maldonado asks us to accept the process server’s
testimony that Maldonado was the driver of the car, he also asks
us to assume he did not attempt to evade service when he drove
away. Essentially, Maldonado asks us to accept his and reject
Luxury Lease’s characterization of the facts by reweighing the
evidence. For example, he directs us to the trial court’s
statements that the process server’s identification of him was
questionable and there was some evidence that Maldonado no
longer lived at the address where the process server purportedly
effectuated service. However, while the trial court acknowledged
these factual issues, it rejected Maldonado’s characterization of
the facts when it conditionally granted his motion, finding him
not credible and attempting to commit a fraud on the court.
Likewise, the trial court also rejected his contention that leaving
the documents at the doorstep was insufficient to effectuate
personal service after Maldonado drove away from the process
server because it was clear that Maldonado was evading service.
Thus, the established facts show that the process server
identified Maldonado, tried to give him a copy of the summons
and complaint, and Maldonado drove off before the process server
could do so. Based on these facts, the trial court correctly
concluded the process server personally served Maldonado and
Maldonado could not deny the personal service on the ground of
lack of delivery, where he attempted to evade personal service.
(Crescendo, supra, 267 Cal.App.2d at p. 212.) As the reviewing
court, we are bound by the trial court’s findings, and we will not
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reweigh evidence or judge the credibility of witnesses on appeal.
(Road Sprinkler Fitters Local Union No. 669 v. G & G Fire
Sprinklers, Inc. (2002) 102 Cal.App.4th 765, 781 (Road
Sprinkler).) Thus, Maldonado has not met his burden to show
error by recharacterizing the evidence and asking us to accept
that characterization on appeal.
This leads us to Maldonado’s second argument—that the
trial court’s findings were not supported by substantial evidence.
Like Maldonado’s first argument, he directs us to conflicts in the
evidence, specifically, the disparate testimony about whether he
was in the car identified by the process server or whether he still
lived at the residence where the documents were left. Effectively,
Maldonado asks us to ignore the process server’s testimony,
which the trial court clearly believed, and substitute his own
version of events, which the trial court flatly rejected. As stated
above, we do not reweigh evidence or judge the credibility of
witnesses on appeal. (Road Sprinkler, supra, 102 Cal.App.4th at
p. 781.) Therefore, Maldonado has failed to meet his burden to
show the trial court’s ruling was unsupported by substantial
evidence.
Last, Maldonado argues the trial court’s conditional grant
of his motion was erroneous because the condition imposed,
specifically, allowing Luxury Lease’s counsel to keep the money
seized while the lawsuit was pending, was unlawful and
unreasonable. Notably, Maldonado first raised this argument in
his reply brief. Therefore, in the absence of a good reason for why
this argument was not presented earlier, we refuse to consider it.
(Reichardt v. Hoffman (1997) 52 Cal.App.4th 754, 764.)
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DISPOSITION
The judgment is affirmed. Respondent is awarded its costs
on appeal.
VIRAMONTES, J.
WE CONCUR:
STRATTON, P. J.
GRIMES, J.
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