Pacific West Group v. Interlandi CA2/8

Filed 1/5/22 Pacific West Group v. Interlandi CA2/8
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 EIGHT
PACIFIC WEST GROUP, INC., B297415
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. BC342152)
v.
GIANFRANCO INTERLANDI,
Defendant and Appellant.
APPEAL from an order of the Superior Court of Los
Angeles County, James E. Blancarte, Judge. Affirmed.
Michael Shemtoub for Defendant and Appellant.
John W. Tulac for Plaintiff and Respondent.
______________________
Almost 10 years after respondent Pacific West Group, Inc.
(Pacific West) obtained a default judgment against appellant
Gianfranco Interlandi (Interlandi) in 2006, Interlandi began
efforts to set aside the default judgment and contest the action.
On September 1, 2016, after the trial court denied Interlandi’s
motion to set aside the default and default judgment and before
Interlandi filed a notice of appeal, Pacific West filed an
application to renew the judgment; the clerk of the court entered
the renewal that same day. A prior appeal followed, and in 2018,
we affirmed the trial court’s denial of Interlandi’s motion to set
aside the default, and rejected his claim that the renewal of the
judgment was invalid because Pacific West’s corporate powers
were suspended at the time of renewal. (Pacific West Group, Inc.
v. Interlandi (B278422, Aug. 29, 2018 [nonpub. opn.] (Pacific
West).)1
After remittitur issued in the prior appeal, Interlandi filed
a motion to vacate the renewal of judgment. Finding he lacked
standing to bring the motion because he was in default, the trial
court took the motion off calendar. Interlandi appeals from this
ruling, claiming the trial court erred in refusing to decide the
1 We grant Pacific West’s request that we take judicial notice
of the docket in that appeal. We deny Pacific West’s request to
augment the record with its proof of service of notice of renewal of
judgment. It is not necessary for the resolution of this appeal.
2
motion to vacate.2 We agree the trial court erred in finding
Interlandi could not challenge the renewal of judgment because
he was in default, but we find no prejudice to Interlandi.
ANALYSIS
Interlandi contends “the only issue on appeal is whether or
not the trial court had jurisdiction to adjudicate the issue before
it.” He contends we must reverse the trial court’s ruling and
remand the matter to allow the trial court to decide the merits of
the motion to vacate the renewal. He specifically contends (1) the
trial court could be permitted to decide the factual issue of
whether he was prejudiced by the incorrect address listed on the
proof of service of the notice of entry of default; (2) this court
improperly made a factual determination in the prior appeal,
when we held that revival of Pacific West’s corporate powers
validated the renewal of judgment which occurred while those
powers were suspended; (3) we must remand to permit the trial
court to decide the factual issue of whether the time for renewal
had expired before Pacific West’s judgment was revived.3
2 After remittitur issued in the prior appeal, Pacific West
filed a motion for costs in the trial court, and Interlandi filed a
motion to tax those costs. The trial court denied Interlandi’s
motion to tax costs, and in his opening brief, Interlandi claims
this ruling was in error. In his reply brief, however, in what he
describes as a clarification, Interlandi contends “the only issue on
appeal is whether or not the trial court had jurisdiction to
adjudicate the issue before it.” Accordingly, as to the denial of
the motion to tax costs, we treat Interlandi’s claims as abandoned
and do not consider them.
3 In his Opening Brief, Interlandi also contended that
renewal should be vacated because service of process was
3
Every civil appeal has two components: error and
prejudice. (Code Civ. Proc.,4 § 475 [“No judgment, decision, or
decree shall be reversed or affected by reason of any error, ruling,
instruction, or defect, unless it shall appear from the record that
such error, ruling, instruction, or defect was prejudicial, . . . and
that a different result would have been probable if such error,
ruling, instruction, or defect had not occurred or existed.”].) We
find error in the trial court’s ruling, but no prejudice to
Interlandi. Therefore, we affirm.
defective and so the trial court lacked personal jurisdiction at the
time it entered the default judgment; the underlying loan
transaction was a fraud; and that the amount of the default
judgment was incorrectly calculated. In his reply brief,
Interlandi fails to include these contentions in his discussion of
prejudice. Given that Interlandi announced a narrowing of the
issues on appeal and then failed to discuss these three
contentions, we deem them abandoned.
More importantly, Interlandi raised all three arguments in
his previous motion to set aside the default judgment, which the
trial court denied. We affirmed the denial. We discussed both
the service of process claim and the fraud claim in our opinion in
that matter. Interlandi did not claim on appeal that the
judgment had been incorrectly calculated, and so conceded the
propriety of that ruling. Interlandi is barred by the law of the
case from raising these claims again. Put differently, even if the
trial court were to hear these claims in connection with the
motion to vacate the renewal, the trial court would not be free to
depart from our prior rulings.
4 Further undesignated statutory references are to the Code
of Civil Procedure.
4
A. The Default Judgment Did Not Preclude Interlandi from
Challenging the Renewal of Judgment.
In explaining its decision to take off calendar the motion to
vacate renewal, the trial court stated: “Upon further study and
consideration, the court finds that because Defendant Interlandi
is in Default, he does not have standing to file a Motion to Set
Aside Renewal of Judgment, or any other action until if and when
the default is set aside in a proper proceeding. [¶] Based on the
above, the Defendant’s Motion to Vacate Renewal of Judgment is
OFF CALENDAR, and not subject to further consideration or
ruling.”
The trial court was mistaken in believing that a defendant
in default cannot challenge the renewal of a judgment.5
Defendants who are in default may challenge the renewal of a
judgment pursuant to section 683.170 on any ground that would
be a defense to an action on the judgment. (Fidelity Creditor
5 The trial court may have been using the language of the
Second Restatement of Torts to mean that the grounds upon
which Interlandi sought relief were not available to him in a
motion to vacate the renewal. Consistent with California law, we
analyze Interlandi’s claims as either “collateral” or “direct”
attacks on the judgment. As Witkin notes, “[t]he Second
Restatement abandons this terminology [and instead asks]:
‘First, does the person seeking relief have standing to obtain
relief from the judgment in question on the ground upon which he
relies? Second, is the forum in which relief is sought the
appropriate one for considering the particular attack? Third,
may evidence be offered in support of the attack when it
“contradicts the face of the record”?’ ” (8 Witkin, Cal. Procedure
(6th ed. 2021) Attack on Judgment in Trial Court, § 1,
pp. 584-585.) This approach is not widely followed in California.
5
Services, Inc. v. Browne (2001) 89 Cal.App.4th 195, 204
(Fidelity).) This error, however, was not prejudicial to Interlandi
because as a matter of law Interlandi has not identified a viable
ground to vacate the renewal of judgment. Thus, a different
result is not probable in the absence of the error, that is, if the
trial court had ruled on the merits of the motion.
B. Defective Notice of Entry of Default Is Not a Defense to an
Independent Action to Enforce a Judgment.
Section 587 provides: “An application by a plaintiff for
entry of default . . . shall include an affidavit stating that a copy
of the application has been mailed to the defendant’s attorney of
record or, it none, to the defendant at his or her last known
address.” Interlandi contends the proof of service of the notice of
entry of default was mailed to an incorrect address, and defective
service of notice of entry of default is a ground which may be
raised on a motion to vacate a renewal of judgment. To support
this contention, he relies on three cases which hold that defective
service of process is a defense which may be raised on a motion to
vacate a renewal of judgment. (Fidelity, supra, 89 Cal.App.4th at
pp. 206–207; Goldman v. Simpson (2008) 160 Cal.App.4th 255(Goldman); Hill v. City Cab & Transfer Co. (1889) 79 Cal.
188, 191 (Hill).) His reliance is misplaced.
The renewal of a judgment “may be vacated on any ground
that would be a defense to an action on the judgment.”
(§ 683.170, subd. (a).) Defective service of process is a defense to
an independent action on the judgment. The defenses to an
independent action on a judgment are quite limited, however,
and defective service of notice of entry of default is not one of
those defenses.
6
“In an independent action on a judgment, the debtor may
challenge the judgment ‘in accordance with the rules and
principles governing collateral attack’ . . . .” (Goldman, supra,
160 Cal.App.4th at pp. 261–262.) “Collateral attack is proper to
contest lack of personal or subject matter jurisdiction or the
granting of relief which the court has no power to grant [citation].
Nonjurisdictional errors, however, are not appropriate procedural
targets within this context.” (Armstrong v. Armstrong (1976)
15 Cal.3d 942, 950.)
Goldman directly involves a claim of lack of personal
jurisdiction. (Goldman, supra, 160 Cal.App.4th at p. 262
[rejecting claim that jurisdiction over debtor based on minimum
contact should be assessed at the time of renewal rather than
when judgment was originally entered].) Fidelity and Hill, also
cited by Interlandi, similarly involves claims of lack of personal
jurisdiction as it discusses failure to serve process. More recent
case law is the same. (See Calvert v. Al Binali (2018)
29 Cal.App.5th 954, 961 [when a court lacks personal jurisdiction
over the parties, an ensuing judgment is void]. Put differently,
the failure to properly serve process on a defendant may be raised
as a defense to an action to enforce a judgment (and so as a
ground to vacate a renewal of judgment) because it is a claim that
the court lacked personal jurisdiction over the defendant.
Unlike the requirement for service of process, “[t]he
requirement of an affidavit of mailing under section 587 is not
jurisdictional, and hence the failure to file one does not deprive
the trial court of jurisdiction to render judgment.” (Rodriguez v.
Henard (2009) 174 Cal.App.4th 529, 536.) Section 587 expressly
provides that “nonreceipt of the notice shall not invalidate or
constitute ground for setting aside any judgment.” (See
7
Rodriguez, at p. 535.) Because defective service of notice under
section 587 does not deprive the court of personal or subject
matter jurisdiction or of the power to enter a renewal of
judgment, it is not a defense in an independent action on the
judgment and so is not a ground to vacate the renewal of a
judgment.
We do not intend to minimize the importance of proper
service in connection with default judgments. Interlandi could
have previously raised the issue of an incorrect address for
service of notice of entry of default in his motion to set aside the
default judgment, which is a direct attack on the judgment and
which permits the introduction of extrinsic evidence by both
parties. However, he did not do so. He attempted to raise it in
his first appeal, but as we explained: “Interlandi has forfeited
this issue by failing to raise it below. [¶] Interlandi made
numerous arguments to the trial court in support of his motion to
vacate [the default]. It does not appear, however, that Interlandi
argued the clerk’s entry of default was improperly served on him
due to an incorrect address.”6 (Pacific West, supra, B278422.)
6 We also note that simply showing an incorrect address on
the proof of service would not have been sufficient to justify
setting aside the default judgment. “A court may properly
decline to set aside a default judgment where the absence of the
affidavit of mailing is not prejudicial.” (Murray & Murray v.
Raissi Real Estate Development, LLC (2015) 233 Cal.App.4th
379, 385.) Since Interlandi did not raise the issue below, the trial
court had no opportunity to decide what was certain to be a
disputed issue of fact.
8
C. The Effect of Revival of Pacific West’s Corporate Powers
Was Properly Decided in the Prior Appeal.
Interlandi acknowledges that this court previously
considered the effect of the suspension of Pacific West’s corporate
powers on the renewal of judgment and resolved that issue
against him. Nevertheless, he contends it was permissible for
him to raise the issue again in his motion to vacate the renewal of
judgment. He suggests this court engaged in improper
factfinding during the prior appeal, and we should remand this
matter to permit the facts to be developed and to let the trial
court do the factfinding concerning “statute of limitations like
§ 337.5 and § 683.020.”
“ ‘ “The doctrine of ‘law of the case’ deals with the effect of
the first appellate decision on the subsequent retrial or appeal:
The decision of an appellate court, stating a rule of law necessary
to the decision of the case, conclusively establishes that rule and
makes it determinative of the rights of the same parties in any
subsequent retrial or appeal in the same case.” ’ (Morohoshi v.
Pacific Home (2004) 34 Cal.4th 482, 491 [20 Cal.Rptr.3d 890,
100 P.3d 433], some italics added.) The doctrine ‘precludes a
party from obtaining appellate review of the same issue more
than once in a single action.’ [Citations.]” (Aghaian v. Minassian
(2021) 64 Cal.App.5th 603, 612 (Aghaian).)
Like Interlandi, the appellant in Aghaian contended “the
law of the case doctrine is irrelevant because it applies only to
legal principles, whereas the question [at hand] is a factual issue.
[Citation.] Minassian is wrong. As we explained in [the prior
appeal], when ‘the facts are not disputed, the effect or legal
significance of those facts is a question of law . . . .’ [Citation.]”
(Aghaian, supra, 64 Cal.App.5th at p. 612.)
9
Here, it is undisputed that Pacific West’s corporate powers
were suspended when Pacific West filed an application to renew
the judgment on September 1, 2016, before the judgment was set
to expire. Although appellant ignores this fact, he does not and
cannot dispute that the clerk of the court performed the
ministerial act of entering a Renewal of Judgment on that same
date. It is undisputed Pacific West achieved good standing with
the Secretary of State during the pendency of the prior appeal
and its corporate powers were revived.
This court has the same authority as does a trial court to
take judicial notice of matters which are subject to judicial notice.
(Evid. Code, § 459; Lockley v. Law Office of Cantrell, Green,
Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 881–882.) In
our prior appeal, we could, and did, take judicial notice of the
documents issued by the California Secretary of State and
Franchise Tax Board as to the status of Pacific West’s corporate
powers and tax obligations. (See El Escorial Owners’ Assn. v.
DLC Plastering, Inc., (2007) 154 Cal.App.4th 1337, 1367; Evid.
Code, § 452.)
Based on the undisputed fact that Pacific West’s corporate
powers were revived during the first appeal, we held: “[W]e find
the renewal of judgment to be valid despite the fact that Pacific
West’s corporate powers were suspended at the time of renewal.
Just as in [Peacock Hill Assn. v. Peacock Lagoon Constr. Co.
(1972) 8 Cal.3d 369 (Peacock Hill)] and [Bourhis v. Lord (2013)
56 Cal.4th 320 (Bourhis)], the previously invalid action was
validated once Pacific West received its certificate of reviver from
the Secretary of State. Like Bourhis, Pacific West’s corporate
powers were suspended at the time it filed its renewal of
judgment. Now that it has been revived, the renewal of judgment
10
is validated even though the revival occurred after the time to
renew the judgment had passed. Although the Peacock Hill and
Bourhis courts addressed corporation suspensions for failure to
pay taxes and not corporate suspension for failure to file a
statement of information, we see no reason to exclude this
situation from their holdings.
“Timberline, [Inc. v. Jaisinghani (1997) 54 Cal.App.4th
1361], the case relied upon by Interlandi, is distinguishable.
There, the court held a suspended corporation which had not
revived its powers may not take advantage of California’s legal
processes for renewing a judgment. (Id. at p. 1363.) However,
the Timberline court specifically noted that the corporation could
have avoided the result by reviving itself. (Id. at p. 1369.) Here,
Pacific West’s corporate powers have been revived. Accordingly,
its renewal of the judgment against Interlandi was validated.
Interlandi’s motion to dismiss and request to vacate the renewal
of judgment is denied.” (Pacific West, supra, B278422.)
In his petition for rehearing in the prior appeal, Interlandi
raised the legal claim he attempts to make again on this appeal:
the statute of limitations is a substantive defense and so the
judgment cannot be revived if it expires while a party’s corporate
powers are suspended. (See, e.g. Leasequip, Inc. v. Dapeer (2002)
103 Cal.App.4th 394, 403 [“ ‘If the statute of limitations runs out
prior to revival of a corporation’s powers, the corporation’s
actions will be time barred even if the complaint would otherwise
have been timely.’ ”].)
11
We denied the petition for rehearing. In our prior opinion,
we held that renewal of judgment is akin to the filing of the
notice of appeal considered in Peacock Hill and Bourhis, which is
a procedural act. To clarify, implicit in our holding is a finding
that section 683.020 is not a statute of limitations. Section
683.020 is part of the larger comprehensive Enforcement of
Judgments Law and provides a period during which an existing
judgment may be enforced pursuant to that law. Put differently,
it provides permission for the judgment creditor to enforce the
judgment for a period of time, which is extended upon
application. (See Benton v. County of Napa (1991)
226 Cal.App.3d 1485, 1491–1492 [extension of one-year use
permit for construction and operation of winery obtained while
party’s corporate powers were suspended was a procedural act;
use permit’s one-year period was not similar to a statute of
limitations].)
In contrast, section 337.5 applies to a new independent
action on a judgment and is a true statute of limitations. Section
337.5 provides that an action upon a judgment be brought
“within 10 years.” This case, however, does not involve an
independent action on a judgment, which is a new action. (See
Kertesz v. Ostrovsky (2004) 115 Cal.App.4th 369, 377.) Thus, the
ability or inability of Interlandi to assert a section 337.5 statute
of limitations defense has no relevance to this case.
In his reply brief, Interlandi suggests for the first time that
this matter should be remanded to provide an “opportunity for
the parties to engage in discovery and to expose inaccuracies and
deception of the other.” We do not ordinarily consider arguments
made for the first time in a reply brief. (United Grand Corp. v.
Malibu Hillbillies, LLC (2019) 36 Cal.App.5th 142, 158.)
12
Interlandi relatedly contends “the evidence and the facts
unearthed at the Trial Court level reveal that the estoppel
argument of ‘dirty trick’ accusation made should result in a
finding that is at odds with the statute of limitations like
expiration of a judgment.” Although this argument is difficult to
understand, it too appears to be an argument first raised in the
reply brief. Significantly, Interlandi provides no record cites for
this evidence and does not provide any context for his claim of
“ ‘dirty trick’ accusation.” “ ‘In order to demonstrate error, an
appellant must supply the reviewing court with some cogent
argument supported by legal analysis and citation to the record.’
[Citation.] . . . ‘We are not obliged to make . . . arguments for
[appellant] [citation], nor are we obliged to speculate about which
issues counsel intend to raise.’ [Citations.] We may and do
‘disregard conclusory arguments that are not supported by
pertinent legal authority or fail to disclose the reasoning by
which the appellant reached the conclusions he wants us to
adopt.’ ” (Id. at p. 153.)
In sum, Interlandi has not shown that it is probable he
would have succeeded on the merits of his motion to vacate
renewal of the judgment against him.
13
DISPOSITION
The trial court’s order is affirmed. Costs are awarded to
respondent Pacific West Group, Inc.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
STRATTON, J.
We concur:
GRIMES, Acting P. J.
WILEY, J.
14