Opinion
B307847
08-31-2021
JOEL ASHMAN, Plaintiff and Appellant, v. OLIVIA LEE, Defendant and Respondent.
Bradley & Gmelich, Barry A. Bradley, Robert A. Crook, and Dawn Cushman for Plaintiff and Appellant. The Cochran Firm California and Edward McLean Lyman III for Defendant and Respondent.
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County No. BC628911, Rupert A. Byrdsong, Judge. Reversed.
Bradley & Gmelich, Barry A. Bradley, Robert A. Crook, and Dawn Cushman for Plaintiff and Appellant.
The Cochran Firm California and Edward McLean Lyman III for Defendant and Respondent.
EDMON, P. J.
Plaintiff and appellant Joel Ashman sued defendant and respondent Olivia Lee for defamation in 2016, and the case proceeded to trial two years later, in 2018. Shortly before trial, Lee substituted out her attorney and began representing herself. Lee appeared at the first day of trial, but that night flew to Chicago and then telephonically sought a continuance. When her request was denied, Lee failed to further participate at trial. Over the next five days, Ashman testified and put on evidence during an uncontested proceeding, at the conclusion of which the trial court (Judge Palazuelos) entered an approximately $7,000,000 judgment in favor of Ashman and against Lee.
More than 15 months after the judgment was entered, Lee filed a motion to vacate the judgment. After initially denying the motion, the trial court (Judge Byrdsong) granted it, characterizing the judgment as a default judgment entered in an amount that exceeded Ashman's statement of damages. Ashman appealed.
We reverse. As we discuss, the judgment was not a default judgment, and thus Ashman's damages were not limited to the amount pled in the complaint and statement of damages. The judgment therefore was not void, and the trial court erred in setting it aside.
FACTUAL AND PROCEDURAL BACKGROUND
A. Background
Ashman and Lee dated for nine months in 2014 and 2015. After their relationship ended, Lee posted a series of defamatory statements on various Internet sites asserting Ashman had defrauded former clients, had committed identity and credit card theft, had sexually assaulted an elderly woman, and was a drug addict. Lee also impersonated Ashman online, using Ashman's photograph, address, and phone number, purporting to seek sex with men.
In June 2016, a four-count criminal complaint was filed charging Lee with violating Penal Code sections 653m, subdivision (a) (harassment through repeated telephone calls or contact by means of an electronic device) and 528.5, subdivision (a) (impersonation of another on an Internet site for the purpose of harming, intimidating, threatening, or defrauding). Lee was convicted by a jury of all four counts and was sentenced to serve 30 days in county jail. She further was ordered to obey a criminal protective order, remove all postings identified in a sentencing memorandum, complete one year of psychiatric and psychological counseling, attend Alcoholics Anonymous, and pay restitution to Ashman.
B. The Present Action
Ashman filed the present defamation action against Lee on July 29, 2016. It alleged that Lee posted a variety of defamatory statements about him on the Internet, including the following (punctuation and usage errors in original):
“Joel Ashman is a FRAUD/LIAR/SCAM ARTIST/CROOK. I am a personal witness to the fact that he takes KICK BACKS, PAY OFFS / BRIBES / FAVORS etc.... I have personally reported him to the following: -FBI, Los Angeles Field Office -Attorney Generals Office: State of California -IRS (they told me there are numerous open/ongoing investigations taking place). I had Joel Ashman do some 3d work for me. He was very difficult to work with... didn't reach the deadline, and I can't even get a hold of Him. This person is a scam! Don't pay anything up front.... Warn all ARTISTS in LOS ANGELES AREA.”
“Joel As[h]man has been in and out of rehab for several years and has gotten much worse instead of getting better. His alcohol and drug abuse is way out of control.... His heroin addiction took over his worthless life and he now looks like a scary skinny zombie with crazy bushy hair. He was addicted to hook up site Tinder and finally they banned him for life, because he kept sending women and men nasty naked pics of himself and his gross tiny little boy penis. Now he is [a] big time active user on Craigslist sexual encounter section which he post new nasty sick ads a million time a day looking for new victims to sexually harass. Because crazy Joel Ashman can't get work in visual effects anymore this sick alcoholic and drug addict tricked Uber and became an Uber driver for only 1 day in his sh*tty cheap black truck and then was fired and arrested for sexually abusing an 85 year lady by forcing himself on Grandma and trying to touch her between her legs. Please get this criminal worthless bum off the streets of LA and into a tiny jail cell as soon as possible.”
“If you are a small business looking for a cheap and user friendly service DO NOT go with Joel Ashman visual effect fake company and service. This professional scam artist will take all your hard earned money that he can squeeze out of you and give you very little in return. Worst ever FAKE Visual Effects huge loser!!! Don't ever hire this Scam Artist and run far away if he ever contacts you with his stupid Bulls*!!! PLUS he stole My identity after I trusted him with my credit card as a client and then he overcharged me and made a lot of random charges to hookers and gay male strip clubs. I contacted the Los Angeles police [department] and the[re] is now a warrant out for Joel Ashman arrest, which he will be locked up in jail very soon for all his horrible crimes against innocent people.”
Ashman alleged that these posts and others were false and defamatory, and caused him to suffer loss of reputation, shame, mortification, and lost business opportunities. He sought general, special, punitive, and exemplary damages according to proof, plus injunctive relief.
On November 8, 2016, Ashman served a statement of damages pursuant to Code of Civil Procedure section 425.11. In it, he claimed damages for pain, suffering, and emotional distress of $150,000, economic losses from loss of business of $500,000, and punitive damages of $50,000, for a total of $700,000.
All subsequent undesignated statutory references are to the Code of Civil Procedure.
Lee appeared through counsel and filed a general denial on December 15, 2016. Separately, Lee filed an action against Ashman, which was consolidated with Ashman's action against Lee; Lee's action ultimately was dismissed after the trial court sustained Ashman's demurrer without leave to amend.
C. Pretrial Motions and Briefs
1. Ashman's Submissions
Ashman filed a trial brief on February 26, 2018. In it, he asserted that Lee's statements were defamatory per se, and therefore no proof of actual damages was required. Ashman further asserted that because Lee made the statements knowing they were false, he was entitled to recover presumed damages (also referred to as general damages), including reasonable compensation for loss of reputation, shame, mortification, hurt feelings, and loss of enjoyment of life. Finally, Ashman asserted he was entitled to recover actual damages, including for business losses. Those losses included the collapse of his visual effects company (which had earned net profits of between $100,000 and $150,000 annually prior to 2015), attorney fees incurred to obtain a restraining order against Lee, and costs in excess of $39,000 to remove Lee's posts from websites such as thedirty.com and ripoffreport.com. Ashman therefore requested a judgment “that compensates him for both [h]is out-of-pocket losses as well as his general damages.”
Ashman filed a witness list, exhibit list, and request for judicial notice of Lee's criminal case on April 20, 2018.
2. Lee's Submissions
Lee filed a trial brief and motions in limine in February 2018. In March 2018, she filed a request to continue the trial, which was granted.
Lee substituted out her attorney on July 11, 2018, and thereafter represented herself. She filed additional motions in limine on July 30, 2018.
D. Uncontested Trial and Judgment
The case was called for trial on August 6, 2018. Ashman appeared with his attorney, and Lee appeared in propria persona. The matter was continued to the following day, with all counsel and unrepresented parties ordered to appear.
On August 7, 2018, Lee appeared via CourtCall. She informed the court that she “is sick, cannot find childcare, and flew to Chicago overnight.” Lee made an oral motion to continue the trial, which the trial court denied. She did not thereafter appear at trial.
For five court days between August 8 and 17, Ashman testified and introduced documents in support of his defamation claim. At the conclusion of the proceeding, the court found in favor of Ashman and against Lee, and on September 14, 2018, the court entered a “Judgment After Findings, ” which stated in relevant part as follows:
Lee repeatedly describes the five-day hearing as a default prove-up. We discuss this characterization in the Discussion, post.
Lee asserts that she was never served with the proposed judgment. In fact, the proposed judgment bears a proof of service that evidences mail service on Lee on August 29, 2019.
“This action came to trial on August 8, 2018, in Department 28 of the Los Angeles Superior Court, Judge Yvette M. Palazuelos presiding. The matter proceeded as a bench trial upon Plaintiff Joel Ashman's Complaint which alleged libel against Olivia Lee.
“Sworn witness testimony was offered, and documentary evidence submitted. After hearing the evidence and arguments of counsel, the following Findings of Fact were made in support of the verdict in Plaintiff Joel Ashman's favor:... [¶]... [¶]
“... Defendant Olivia Lee publish[ed] false statements of material fact concerning Plaintiff Joel Ashman on the internet site thedirty.com. [¶]... [¶]
“... Defendant Olivia Lee act[ed] intentionally, willfully, maliciously, and with the intent to injure Plaintiff Joel Ashman when she caused multiple postings and commentary to be published on the internet site thedirty.com.... [¶]... [¶]
“... Defendant Olivia Lee publish[ed] false statements of material fact concerning Plaintiff Joel Ashman on the internet site ripoffreport.com.... [¶]... [¶]
“... Defendant Olivia Lee act[ed] intentionally, willfully, maliciously, and with the intent to injure Plaintiff Joel Ashman when she caused multiple postings to be published on the internet site ripoffreport.com....
“... Defendant Olivia Lee publish[ed] false statements of material fact concerning Plaintiff Joel Ashman on the internet site yscam.com....
“... Defendant Olivia Lee act[ed] intentionally, willfully, maliciously, and with the intent to injure Plaintiff Joel Ashman when she caused multiple postings to be published on the internet site yscam.com....
“... Defendant Olivia Lee publish[ed] false statements of material fact concerning Plaintiff Joel Ashman on the internet site outscam.com....
“... Defendant Olivia Lee act[ed] intentionally, willfully, maliciously, and with the intent to injure Plaintiff Joel Ashman when she caused the posting to be published on the internet site outscam.com....
“... Defendant Olivia Lee publish[ed] false statements of material fact concerning Plaintiff Joel Ashman on the internet site Craigslist.com....
“... Defendant Olivia Lee act[ed] intentionally, willfully, maliciously, and with the intent to injure Plaintiff Joel Ashman when she caused the posting to be published on the internet site Craigslist.com....
“... Defendant Olivia Lee publish[ed] false statements of material fact concerning Plaintiff Joel Ashman on the internet site Facebook.com....
“... Defendant Olivia Lee act[ed] intentionally, willfully, maliciously, and with the intent to injure Plaintiff Joel Ashman when she caused the posting to be published on the internet site Facebook.com....
“... [T]he false statements of material fact published by Defendant Olivia Lee [were] reasonably understood by people to be about Plaintiff Joel Ashman....
“... [T]he false statements of material fact published by Defendant Olivia Lee actually injure[d] Plaintiff Joel Ashman, including injury [to] his reputation, business, profession, or occupation....
“... Joel Ashman [has] proven by clear and convincing evidence that Defendant Olivia Lee acted with such malice, oppression, or fraud that punitive damages should be awarded....”
Based on the foregoing, the judgment awarded Ashman the following damages:
Cost to seek removal of 25 web postings: $75,000
Past lost wages: $584,000
Other past economic losses: $100,000
Past noneconomic losses: $690,000
Future lost wages: $1,860,000
Other future economic losses: $0
Future noneconomic losses: $1,860,000
Punitive damages: $2,000,000
TOTAL DAMAGES: $7,169,000
The judgment further ordered Lee to fully cooperate in removing all libelous material from the identified websites, and it enjoined Lee from publishing, or causing to be published, any further statements concerning Ashman. The court clerk served notice of entry of the judgment on September 14, 2018.
On October 15, 2018, the trial court entered a First Amended Judgment that was nearly identical to the original judgment, but added an award of costs of $1,685. Ashman served notice of entry of the first amended judgment on November 5, 2018.
Lee asserts that she was not served with the proposed amended judgment. In fact, the proposed amended judgment bears a proof of mail service on Lee on September 27, 2018.
E. Lee's Untimely Appeal
Lee filed a notice of appeal from the judgment on June 14, 2019. The appeal was dismissed as untimely on September 6, 2019.
F. Lee's Motions to Vacate the Judgment
On July 11, 2019, Lee filed an ex parte application to stay the judgment and for an order shortening time to file a motion to set aside the judgment. The trial court denied the application without a hearing the same day.
Lee filed a motion to set aside the judgment on January 27, 2020. The court denied the motion without prejudice on February 10, 2020.
Lee filed a second motion to set aside or vacate the judgment on February 25, 2020, and filed a third motion on February 26, 2020. In it, she characterized the first amended judgment as a “default judgment, ” which she urged was facially void and thus subject to being set aside at any time because it awarded damages in excess of those claimed in Ashman's statement of damages. Lee further contended that many of Ashman's claims were time-barred, and equitable grounds existed to vacate the judgment because the trial court had unreasonably denied Lee “due process, a right to be heard, and a right to defend herself against Ashman's baseless claims.”
The two motions are nearly identical, and thus we presume that Lee intended the February 26 motion to supersede the motion filed a day earlier.
In support of her motion, Lee submitted her own declaration, in which she said she never received proper notice of the first amended judgment and learned about it only when Ashman filed an enforcement action against her in May 2019. She also attached a series of exhibits, including Ashman's complaint, statement of damages, and trial brief, the minute orders from the trial, and the judgment and amended judgment.
On April 20, 2020, Ashman, now appearing in propria persona, filed the declaration of his trial attorney, Robert Crook, in opposition to the motion to set aside the judgment. Attorney Crook stated as follows.
• Crook was Ashman's trial counsel. He participated in the bench trial before Judge Palazuelos, and also represented Ashman in connection with the restitution order in the criminal matter, People v. Olivia Lee.
• Attorney Michael Merslak was Lee's original attorney. On the eve of trial, Lee decided to represent herself. She also decided not to attend trial, and the matter proceeded as a bench trial before Judge Palazuelos.
• Crook was present when Lee was in court and told the court she did not intend to appear at trial. The judge advised her that she needed to be present. She was not. The matter proceeded as a bench trial during which several binders of exhibits were authenticated and provided to the court along with the testimony of plaintiff Ashman. Findings of fact were prepared and decided by Judge Palazuelos, who completed and signed the judgment.
• A proposed judgment was served on Lee on August 29, 2018. She did not object to it. The proposed judgment then was modified, signed, and entered by the court on September 14, 2018. The judgment reflects that the clerk was to give notice, which the clerk did. Lee did not take any action on the judgment.
• A cost bill was served on Lee. She took no action on it.
• A proposed first amended judgment was served on Lee on September 27, 2018. The judgment was substantially the same as the original judgment, but it also awarded Ashman costs of $1,685. Notice of entry was served on Lee on November 5, 2018. She took no action.
• No grounds exist to set aside the judgment. There is nothing on the face of the judgment to establish that it is void. The court has no jurisdiction to stay enforcement of the judgment or to vacate it.
On July 14, 2020, Judge Rupert Byrdsong, who was now sitting in the trial department, conducted a telephonic hearing on the motion. The court adopted Lee's characterization of the judgment as a default judgment and said the tentative was to vacate the judgment because there were “inconsistent numbers with regard to [the] default and [the] statement of damages.” The court said: “[W]hen you have an inconsistency in the statement of damages and the actual default, it can be set aside. Preceden[t] says that that's not fair because then the defendant hasn't had the proper notice. The statement of damages is supposed to give the defendant notice of how much they may be on the hook for.... So that kind of sets the benchmark. And then you have this default that's different from that.... And I think it makes sense that, when you're talking about numbers, those numbers should be aligned and match. So that's the basis.” The court then asked Lee's counsel if “you want to get an order indicating that the motion to set aside was granted?” Lee's counsel said he did; the court responded, “You'll get that.”
The court entered a written order vacating the judgment on September 17, 2020. Ashman filed a notice of appeal on September 28, 2020.
DISCUSSION
Ashman contends that because Lee filed her motion to vacate more than 16 months after judgment was entered, the trial court had authority to grant the motion only if the judgment was void. The judgment in the present case was not void: Although a default judgment is void if the damages awarded exceed those pled, that rule does not apply to the present case, where the court entered a judgment following an uncontested court trial, not a default judgment. Ashman therefore contends the order must be reversed and the judgment reinstated.
Lee urges that Ashman's notice of appeal was untimely because it was filed more than 60 days from the hearing on the motion to vacate. On the merits, she contends that some of Ashman's claims were time-barred; she was held liable for Internet posts not alleged in the complaint; the judgment exceeded the damages alleged in the complaint and statement of damages; the judgment violates Lee's right to freedom of speech; and the trial court properly set aside the judgment on equitable grounds.
As set forth more fully below, the trial court erred in granting the motion to vacate the judgment because it was filed more than six months after notice of entry of judgment was served and the judgment was not void. We therefore will reverse the order granting the motion and reinstate the judgment.
I.
Appealability
Lee concedes that the order granting the motion to vacate is appealable, but she contends the notice of appeal was untimely because it was filed more than 60 days after the trial court “entered [the] order... in its permanent minutes on July 14, 2020.” Not so. To be timely, a notice of appeal from a postjudgment order must be filed either within 60 days of service of notice of entry of the order or 180 days from entry of the order, whichever is earlier. (Cal. Rules of Court, rule 8.104(a), (e).) The date of entry of an appealable order generally is the date it is entered in the permanent minutes, but “if the minute order directs that a written order be prepared, the entry date is the date the signed order is filed.” (Rule 8.104(c)(2).)
An order granting a statutory motion to vacate or set aside a default judgment is appealable under section 904.1, subdivision (a)(2), as an order made after final judgment. (County of Stanislaus v. Johnson (1996) 43 Cal.App.4th 832, 834; see Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (The Rutter Group 2019) ¶¶ 2:165, 2:166.)
Rule 8.406, which Lee cites for the proposition that the notice of appeal was not timely filed, applies to juvenile appeals. The present civil appeal is governed by rule 8.104. All subsequent undesignated rule references are to the California Rules of Court.
In the present case, the July 14, 2020 minute order states, “Defendant is to submit a proposed order and give notice.” Lee apparently never submitted a proposed order, but Ashman did so, and the trial court signed it on September 17, 2020. Pursuant to rule 8.104(c)(2), therefore, Ashman's time to appeal ran from entry of the written order, and thus his notice of appeal, filed September 28, 2020, was timely.
II.
The Trial Court Abused Its Discretion by Granting Lee's Motion to Vacate the Judgment
A. Standard of Review
An order granting a motion to vacate the judgment typically is reviewed for an abuse of discretion. (J.M. v. G.H. (2014) 228 Cal.App.4th 925, 940; County of San Diego v. Gorham (2010) 186 Cal.App.4th 1215, 1225.) However, where the order is based on the trial court's determination that the judgment is void, we review that determination de novo. (Grados v. Shiau (2021) 63 Cal.App.5th 1042, 1049; Cruz v. Fagor America, Inc. (2007) 146 Cal.App.4th 488, 496.)
B. Lee Was Not Entitled to Relief Under Code of Civil Procedure Sections 473 or 473.5
Lee sought relief from the judgment pursuant to sections 473 and 473.5. As relevant here, those sections provide as follows. First, section 473, subdivision (b) provides that a court may relieve a party “from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect.” An application for relief under this section must be made “within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken.” (§ 473, subd. (b).) Second, section 473, subdivision (d) provides that a court may, on motion of either party after notice to the other party, “set aside any void judgment or order.” (Italics added.) A void judgment is vulnerable to direct or collateral attack “ ‘ “at any time.”' ” (Strathvale Holdings v. E.B.H. (2005) 126 Cal.App.4th 1241, 1249, quoting People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 660.) Third, section 473.5 provides that a court may set aside a judgment “[w]hen service of a summons has not resulted in actual notice to a party in time to defend the action and a default or default judgment has been entered against him or her in the action.”
In the present case, Lee filed her motion to vacate the judgment on February 26, 2020, more than 15 months after the trial court entered the first amended judgment. Because the motion thus was not made within six months of entry of judgment, relief was not available under section 473, subdivision (b). Relief also was not available under section 473.5: Lee plainly had “actual notice” of this action, as she filed an answer to the complaint, litigated for more than 18 months, and appeared at the first day of trial. Accordingly, relief is available, if at all, only under section 473, subdivision (d)-i.e., if the judgment was void. (See, e.g., Lee v. An (2008) 168 Cal.App.4th 558, 563 [“ ‘A trial court has no statutory power under section 473, subdivision (d) to set aside a judgment that is not void' ”]; Cruz v. Fagor America, Inc., supra, 146 Cal.App.4th at pp. 495-496 [same].)
It is undisputed that a default judgment is void, and thus can be set aside at any time, if it is entered in an amount greater than the amount specifically demanded in the plaintiff's complaint or statement of damages. (§ 580, subd. (a); Greenup v. Rodman (1986) 42 Cal.3d 822, 824 [“in all default judgments the demand sets a ceiling on recovery”]; Yu v. Liberty Surplus Ins. Corp. (2018) 30 Cal.App.5th 1024, 1027 [“A demand for ‘damages according to proof'... does not provide adequate notice to sustain a default judgment.”]; Simke, Chodos, Silberfeld & Anteau, Inc. v. Athans (2011) 195 Cal.App.4th 1275, 1286 [“[a] default judgment that violates section 580 is void; it can be challenged and set aside at any time.”].) Accordingly, if the first amended judgment was a default judgment, then it properly was vacated because the amount awarded exceeded the damages pled in the complaint and statement of damages.
A different rule applies, however, to a judgment entered following a trial. As Ashman correctly notes, in cases other than those in which a defendant's default has been entered, “the court may grant the plaintiff any relief consistent with the case made by the complaint and embraced within the issue.” (§ 580, subd. (a).) Accordingly, courts routinely have affirmed judgments supported by substantial evidence at trial, even if the judgments exceeded the amount demanded in the complaints or statements of damages. (See, e.g., Damele v. Mack Trucks, Inc. (1990) 219 Cal.App.3d 29, 42 [plaintiff's recovery at trial “was not limited by the amount requested in his section 425.11 statement of damages”]; Castaic Clay Manufacturing Co. v. Dedes (1987) 195 Cal.App.3d 444, 449-450 [trial court did not err by awarding damages that exceeded the amount of general damages set forth in the body of the complaint]; American Motorists Ins. Co. v. Cowan (1982) 127 Cal.App.3d 875, 883 [“it is fundamental that after trial on the merits, the court may afford any form of relief supported by the evidence and as to which the parties were on notice, whether requested in the pleadings or not”]; Knoblock v. Waale-Camplan Co. (1956) 141 Cal.App.2d 870, 873-874 [“an answer having been filed, the court was authorized to grant ‘any relief consistent with the case made by the complaint and embraced within the issue.' [Citation.] This is true irrespective of the theory upon which the facts were pleaded, the title of the pleading, or what relief was sought by the prayer.”], italics added.)
Accordingly, if the first amended judgment was not a default judgment, then the fact that the damages awarded exceeded those alleged in the complaint and statement of damages did not render it void, and therefore the judgment could not be set aside more than six months after it was entered.
Lee argued in the trial court, and the trial court apparently concluded, that the first amended judgment was a default judgment because Lee did not appear at trial. But with exceptions not relevant here, the Code of Civil Procedure defines a default judgment much more narrowly, as judgment entered “if there is no answer.” (§ 580, subd. (a); see also § 585, subds. (a), (b).) Accordingly, courts of appeal consistently have held that if a defendant has filed an answer to the complaint and the answer has not been stricken, the trial court lacks authority to take the defendant's default. As one court explained: “ ‘Section 585 of the Code of Civil Procedure does not authorize the entry of any default in cases where an answer is on file, whether the defendant does or does not appear at the time the action is called for hearing. [Citations.] Where the defendant who has answered fails to appear for trial “the plaintiff's sole remedy is to move the court to proceed with the trial and introduce whatever testimony there may be to sustain the plaintiff's cause of action.” [Citation.] In such case a plaintiff is entitled to proceed under the provisions of Code of Civil Procedure, section 594, subdivision 1 [now, subdivisions (a) and (b)], and he may do so in the absence of the defendant provided the defendant has been given at least five days notice of the trial. [However, ] [s]ection 594 does not authorize the entry of the default in the event the defendant fails to appear, and a hearing held pursuant to that section under such circumstances is uncontested as distinguished from a default hearing.' ” (Heidary v. Yadollahi (2002) 99 Cal.App.4th 857, 863-864, fn. omitted; see also Garamendi v. Golden Eagle Ins. Co. (2004) 116 Cal.App.4th 694, 705 (Garamendi) [“As long as [the defendant's] answer remained on file, the court lacked the authority to enter its default”]; Shayan v. Spine Care & Orthopedic Physicians (2020) 44 Cal.App.5th 167, 169 [trial court properly refused to grant relief under mandatory provision of section 473, subdivision (b), which applies to “defaults, default judgments, and dismissals, ” because judgment was entered after an uncontested trial, not a default].)
There is no dispute in the present case that Lee filed an answer to the complaint, and that she thereafter actively litigated the case for more than 18 months. Plainly, therefore, the first amended judgment was not a default judgment. Nor did the first amended judgment purport to have been entered on Lee's default. To the contrary, it was captioned a “First Amended Judgment After Findings, ” and it recited that the action “came to trial on August 8, 2018” and “proceeded as a bench trial.” (Italics added.) The first amended judgment further stated that “[s]worn witness testimony was offered, ” “documentary evidence [was] admitted, ” and, “Findings of Fact were made in support of the verdict in Plaintiff Joel Ashman's favor... [a]fter hearing the evidence and argument of counsel.” On its face, therefore, the judgment was nota default judgment-it was, instead, a judgment entered following a court trial, albeit an uncontested one. (See § 594, subd. (a) [“either party may bring an issue to trial or to a hearing, and, in the absence of the adverse party, unless the court, for good cause, otherwise directs, may proceed with the case and take a dismissal of the action, or a verdict, or judgment, as the case may require”].)
Citing Garamendi, supra, 116 Cal.App.4th 694, Lee contends that even if the judgment was not a default judgment, it nonetheless was void because Lee was not present at trial and the damages awarded exceeded the amount pled in the complaint. But Garamendi holds precisely the opposite. In Garamendi, a group of homeowners sued a contractor for construction defects; the contractor cross-claimed for indemnity against a subcontractor and its insurer. The homeowners settled with the contractor and received an assignment of its claims against the subcontractor. A few days prior to the start of trial, however, it was discovered that the subcontractor's corporate status had been suspended, and thus the subcontractor could not appear to defend the action. Its insurer was given the opportunity to intervene and appear at trial but declined to do so. The case therefore proceeded to a five-day uncontested trial, at the conclusion of which the court found the subcontractor was liable for damages and entered a judgment of $1.3 million against it. (Id. at pp. 699−701.)
The subcontractor's insurer became insolvent shortly after the trial concluded, and thus the homeowners sought to enforce their judgment by submitting a claim to the insurer's conservator. The conservator denied the homeowners' proof of claim on the ground that the underlying judgment was a default judgment. The homeowners then challenged that decision in the superior court, which concluded that the judgment had not been taken by default, and therefore it was enforceable against the insurer. (Garamendi, supra, 116 Cal.App.4that pp. 698−699.)
On appeal, the insurer contended that because the subcontractor had not participated at trial, the judgment was akin to a default judgment, and thus the homeowners could not recover more than the $125,000 specifically demanded in their complaint. (Garamendi, supra, 116 Cal.App.4that p. 704.) The Court of Appeal disagreed, noting that section 580 places a limit on the amount of recovery only in the event that “there is no answer” by the defendant. In the case before it, the subcontractor had filed an answer and actively defended the homeowners' claims until the start of trial; when the subcontractor ceased to participate in the litigation, the trial court nonetheless considered the evidence introduced during proceedings in which other interested parties actively participated. Accordingly, the judgment against the subcontractor was not entered by default and, thus, section 580 did not limit the amount of the judgment that could be entered against the subcontractor. (Garamendi, at p. 705.)
The court further concluded the homeowners were not limited by general principles of due process from recovering from the subcontractor greater damages than were alleged in the complaint, so long as the subcontractor was on notice of the categories of damages the homeowners intended to seek. (Garamendi, supra, 116 Cal.App.4that pp. 706−709.) The court explained: “The fact that the precise amount of the requested damages was not specified in the complaint does not mean that the resulting judgment necessarily resulted in a deprivation of due process of law.... [¶] [Here], [b]oth the claimants' complaint and undoubtedly the discovery in which [the subcontractor] participated prior to withdrawing from the action made clear that claimants were seeking to recover more than $125,000 for their own property damages and for the damages they were seeking to recover as [the contractor's] assignee.” (Id. at p. 706.) Thus, the insurer was provided with sufficient notice of the damages sought and an opportunity to defend against them prior to the entry of judgment. (Id. at pp. 706-707, citing In re Genesys Data Technologies, Inc. (Hawaii 2001) 95 Haw. 33, 18 P.3d 895, 905.)
The court concluded, however, that the homeowners could not recover personal injury damages because the operative complaint at time of trial “contained no allegations of personal injury, ” and thus the subcontractor “had no reason to anticipate liability for such when it failed to reactivate its corporate status in order to defend the action, nor did [the insurer] when it declined to intervene.” (Garamendi, supra, 116 Cal.App.4th at p. 708.) For the same reason, the court invalidated the portion of the award attributable to the homeowners' attorney fees: “[T]he operative complaint gave [the subcontractor] no notice that claimants would seek to recover their attorney fees [and] did not allege the existence of an agreement that the prevailing party recover its attorney fees.” (Ibid.)
The present case is analogous to Garamendi. Like the defendant subcontractor in Garamendi, Lee answered the complaint and actively participated in litigation up until the time of trial. Further, as in Garamendi, after Lee refused to participate in the trial, Ashman testified and offered documentary evidence over the course of a five-day proceeding. After Ashman rested and his attorney gave a closing statement, the trial court made findings and entered a judgment that explicitly referenced Ashman's evidence. As in Garamendi, therefore, the amended judgment in the present case was not a default judgment, and thus Ashman was not precluded from recovering more than he pled in his complaint and statement of damages.
Debbie S. v. Ray (1993) 16 Cal.App.4th 193, cited by Lee, is inapposite. There, the Court of Appeal affirmed an order setting aside a judgment on the ground that the plaintiff had not served the defendant with a statement of damages. In doing so, the court explicitly distinguished an earlier decision in which a Court of Appeal affirmed a judgment in an amount that exceeded the plaintiff's statement of damages. That decision, the Debbie S. court said, “is not contrary to the conclusion we reach in this case. The problem here is not that the judgment exceeds the amount stated in the statutory notice of damages, but that there was no notice of damages.” (Id. at p. 200, italics added.) In the present case, Ashman served a statement of damages after filing his complaint, and thus Debbie S. does not apply.
Our conclusion is not changed by the fact that the clerk's minute orders characterize the proceedings as a “default prove up hearing, ” not a trial. The minute orders in Garamendi similarly referred to a default prove-up-a fact that the Court of Appeal found to be without significance. It explained: “The term did not appear in any order or other document signed by the trial judge. The minute order simply reflects that the clerk, like the claims administrator, failed to appreciate the distinction between a default judgment entered pursuant to Code of Civil Procedure sections 580 and 585 and a judgment entered after an uncontested hearing pursuant to Code of Civil Procedure section 594.” (Garamendi, supra, 116 Cal.App.4th at p. 705, fn. 3.)
Finally, although Lee has not raised this issue, we note that the judgment in the present case did not award any categories of damages not pled in the complaint. The complaint specifically alleged that Lee's defamatory statements caused Ashman to suffer loss of reputation, shame, and mortification, and to lose multiple business and acting opportunities; it sought both general and special damages according to proof, as well as punitive damages. The statement of damages similarly stated that Ashman sought damages for “pain, suffering, and inconvenience, ” “economic losses from loss of business, ” and punitive damages. Finally, Ashman's trial brief, which was filed and served in February 2018, more than six months before trial, asserted that Ashman was seeking the following damages:
-Presumed damages, including “reasonable compensation for loss of reputation, shame, mortification, hurt feelings, loss of enjoyment of life. No definite standard or method of calculation is prescribed by law by which to fix reasonable compensation for presumed damages... [and] the trier of fact shall exercise authority with calm and reasonable judgment and the damages fixed shall be just in light of the evidence.”
-Out-of-pocket damages, including loss of profits from Ashman's visual effects business (which dropped from $148,490 in 2014 to $11,762 in 2015), costs of $2,200 per page to remove 18 remaining defamatory posts, and attorney fees to seek a restraining order against Lee.
-Punitive damages “to punish Plaintiff.”
Ashman filed a revised and supplemental trial brief on August 7, 2018, which further laid out his claimed damages with reference to “four binders which are indexed by Exhibits 1-103.”
The judgment awarded Ashman the same categories of damages alleged in the complaint and described in Ashman's statement of damages and trial brief-namely:
-Past and future noneconomic (general) damages, including for shame, mortification, hurt feelings, and loss to reputation;
-Past and future economic (actual) damages, including lost wages, costs to remove defamatory material from websites, and other past economic losses;
-Punitive damages.
Because the trial court thus did not award Ashman any categories of damages not pled in his complaint, none need be stricken from the judgment.
C. Lee's Remaining Contentions Are Without Merit
Lee contends the judgment was void because it held her liable “for 19 posts not alleged in the complaint” and “for incidents that occurred beyond the statute of limitations, ” and because it imposed a permanent injunction against her that violated her free speech rights. Lee does not cite us to any authority for the proposition that these alleged errors render the judgment void, and thus we do not consider them. (E.g., People v. Stanley (1995) 10 Cal.4th 764, 793 [“ ‘[E]very brief should contain a legal argument with citation of authorities on the points made. If none is furnished on a particular point, the court may treat it as waived, and pass it without consideration' ”].)
Lee also contends that the trial court did not abuse its discretion by setting aside the judgment on equitable grounds. In fact, the court did not set aside the judgment pursuant to its inherent equitable powers: Although the written order states the motion was granted “based on the grounds set forth in the moving papers, ” it is clear from the transcript of the July 14, 2020 oral proceedings that the trial court set aside the judgment for just one reason-because “you have inconsistent numbers with regard to a default and a statement of damages, that's the basis to have it set aside.” The court also made clear that it was not exercising discretion, but instead believed it was required to set aside the judgment under the present circumstances. It explained: “Preceden[t] says... the statement of damages is supposed to give the defendant notice of how much they may be on the hook for. [¶]... [¶]... So that kind of sets the benchmark. And then you have this default that's different from that. That's not proper. I didn't make those rules, that's what the precedent is.” (Italics added.)
In any event, even had the trial court purported to set aside the judgment on equitable grounds, we nonetheless would be compelled to reverse. Lee is correct that “courts have the inherent authority to vacate a default and default judgment on equitable grounds such as extrinsic fraud or extrinsic mistake.” (Bae v. T.D. Service Co. of Arizona (2016) 245 Cal.App.4th 89, 97.) However, “the court's ability to grant relief under its inherent power is narrower than its ability to grant relief under section 473” and equitable relief may be granted “ ‘only in exceptional circumstances.' ” (Kramer v. Traditional Escrow, Inc. (2020) 56 Cal.App.5th 13, 29 (Kramer).) Specifically, a party seeking relief under the court's equitable powers “must satisfy the elements of a ‘stringent three-pronged test': (1) a satisfactory excuse for not presenting a defense, (2) a meritorious defense, and (3) diligence in seeking to set aside the [judgment]. (Rappleyea [v. Campbell (1994)] 8 Cal.4th [975, ] 982-983.)” (Kramer, at p. 29.)
A defendant has a satisfactory excuse “if it shows that an extrinsic fraud or extrinsic mistake occurred.” (Kramer, supra, 56 Cal.App.5th at p. 29.) Extrinsic fraud and extrinsic mistake “are unavailable when a party's own negligence allows the fraud or mistake to occur.” (Ibid.) Such is the case here: Lee knew of this lawsuit, yet chose not to participate in it. Nor did Lee show that she had a “meritorious defense” to Ashman's claims; to the contrary, her motion to vacate and supporting declarations were completely silent regarding the merits of her defense. Finally, Lee did not show diligence in seeking to set aside the judgment. By her own admission, Lee knew on August 6, 2018-i.e., prior to the entry of judgment-that the trial court would not continue the trial. Based on this undisputed knowledge, we must attribute to Lee the knowledge that a judgment would be entered against her. In any event, Lee admits that she knew about the amended judgment at least by the time that Ashman began enforcement proceedings in Illinois in May 2019, a full nine months before Lee moved to set the judgment aside. By any measure, Lee did not act with the requisite diligence.
For all of these reasons, had the trial court purported to vacate the judgment on discretionary grounds, we necessarily would conclude it had abused its discretion.
DISPOSITION
The order granting the motion to vacate the judgment is reversed and the October 15, 2018 judgment is ordered reinstated. Ashman is awarded his appellate costs.
We concur: LAVIN, J., HILL, J. [*]
[*] Judge of the Santa Barbara Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.